EXHIBIT 10.3
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TERM LOAN AGREEMENT
among
BRANDYWINE REALTY TRUST
and
BRANDYWINE OPERATING PARTNERSHIP, L.P.,
as Borrowers
and
THE LENDERS IDENTIFIED HEREIN
and
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent and Syndication Agent
DATED AS OF January 5, 2006
J.P. MORGAN SECURITIES INC.
as Lead Arranger and Sole Bookrunner
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TABLE OF CONTENTS
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SECTION 1. DEFINITIONS AND ACCOUNTING TERMS..................................................1
1.1 Definitions...........................................................................1
1.2 Computation of Time Periods and Other Definition Provisions..........................24
1.3 Accounting Terms.....................................................................24
1.4 Joint Venture Investments............................................................25
SECTION 2. LOAN FACILITY....................................................................25
2.1 Loans................................................................................25
2.2 Joint and Several Liability of the Borrowers.........................................28
2.3 Appointment of BOP...................................................................30
2.4 Non-Recourse.........................................................................30
SECTION 3. GENERAL PROVISIONS APPLICABLE TO LOANS...........................................30
3.1 Interest.............................................................................30
3.2 Place and Manner of Payments.........................................................31
3.3 Prepayments..........................................................................31
3.4 Facility Fee; Administrative Fees....................................................32
3.5 Payment in Full at Maturity..........................................................33
3.6 Computations of Interest and Fees....................................................33
3.7 Pro Rata Treatment...................................................................34
3.8 Sharing of Payments..................................................................34
3.9 Capital Adequacy.....................................................................35
3.10 Inability To Determine Interest Rate.................................................36
3.11 Illegality...........................................................................36
3.12 Requirements of Law..................................................................36
3.13 Taxes................................................................................38
3.14 Compensation.........................................................................40
3.15 Mitigation; Mandatory Assignment.....................................................41
SECTION 4. [RESERVED].......................................................................41
SECTION 5. CONDITIONS PRECEDENT.............................................................41
5.1 Closing Conditions...................................................................41
5.2 Funding Conditions...................................................................43
SECTION 6. REPRESENTATIONS AND WARRANTIES...................................................45
6.1 Financial Condition..................................................................46
6.2 No Material Change...................................................................46
6.3 Organization and Good Standing.......................................................46
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6.4 Due Authorization....................................................................46
6.5 No Conflicts.........................................................................47
6.6 Consents.............................................................................47
6.7 Enforceable Obligations..............................................................47
6.8 No Default...........................................................................47
6.9 Ownership............................................................................48
6.10 Indebtedness.........................................................................48
6.11 Litigation...........................................................................48
6.12 Taxes................................................................................48
6.13 Compliance with Law..................................................................48
6.14 Compliance with ERISA................................................................48
6.15 Organization Structure/Subsidiaries..................................................50
6.16 Use of Proceeds; Margin Stock........................................................50
6.17 Government Regulation................................................................50
6.18 Environmental Matters................................................................50
6.19 Solvency.............................................................................52
6.20 Investments..........................................................................52
6.21 Location of Properties...............................................................52
6.22 Disclosure...........................................................................52
6.23 Licenses, etc........................................................................52
6.24 No Burdensome Restrictions...........................................................53
6.25 Eligible Subsidiaries................................................................53
6.26 Foreign Assets Control Regulations, Etc..............................................53
SECTION 7. AFFIRMATIVE COVENANTS............................................................53
7.1 Information Covenants................................................................53
7.2 Financial Covenants..................................................................58
7.3 Preservation of Existence............................................................58
7.4 Books and Records....................................................................59
7.5 Compliance with Law..................................................................59
7.6 Payment of Taxes and Other Indebtedness..............................................59
7.7 Insurance............................................................................59
7.8 Maintenance of Assets................................................................59
7.9 Performance of Obligations...........................................................60
7.10 Use of Proceeds......................................................................60
7.11 Audits/Inspections...................................................................60
7.12 Additional Loan Parties..............................................................60
7.13 Interest Rate Protection Agreements..................................................61
7.14 Construction.........................................................................61
7.15 Acquisitions and Sales...............................................................61
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SECTION 8. NEGATIVE COVENANTS...............................................................61
8.1 Indebtedness.........................................................................62
8.2 Liens................................................................................62
8.3 Nature of Business...................................................................62
8.4 Consolidation and Merger.............................................................62
8.5 Sale or Lease of Assets..............................................................63
8.6 Advances, Investments and Loans......................................................63
8.7 Restricted Payments..................................................................63
8.8 Transactions with Affiliates.........................................................64
8.9 Fiscal Year; Organizational Documents................................................64
8.10 Limitations..........................................................................64
8.11 Other Negative Pledges...............................................................64
SECTION 9. EVENTS OF DEFAULT................................................................65
9.1 Events of Default....................................................................65
9.2 Acceleration; Remedies...............................................................68
9.3 Allocation of Payments After Event of Default........................................68
SECTION 10. AGENCY PROVISIONS................................................................69
10.1 Appointment..........................................................................69
10.2 Delegation of Duties.................................................................70
10.3 Exculpatory Provisions...............................................................70
10.4 Reliance on Communications...........................................................70
10.5 Notice of Default....................................................................71
10.6 Non-Reliance on Administrative Agent and Other Lenders...............................71
10.7 Indemnification......................................................................72
10.8 Administrative Agent in Its Individual Capacity......................................72
10.9 Successor Agent......................................................................73
SECTION 11. MISCELLANEOUS....................................................................73
11.1 Notices..............................................................................73
11.2 Right of Set-Off.....................................................................74
11.3 Benefit of Agreement.................................................................74
11.4 No Waiver; Remedies Cumulative.......................................................77
11.5 Payment of Expenses; Indemnification.................................................77
11.6 Amendments, Waivers and Consents.....................................................78
11.7 Counterparts/Telecopy................................................................79
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11.8 Headings.............................................................................79
11.9 Defaulting Lender....................................................................79
11.10 Survival of Indemnification and Representations and Warranties.......................80
11.11 Governing Law; Jurisdiction..........................................................80
11.12 Waiver of Jury Trial.................................................................80
11.13 Time.................................................................................81
11.14 Severability.........................................................................81
11.15 Entirety.............................................................................81
11.16 Binding Effect.......................................................................81
11.17 Confidentiality......................................................................82
11.18 Further Assurances...................................................................82
11.19 Release of Guarantors................................................................82
11.20 USA PATRIOT Act......................................................................82
11.21 Limitation on Liability..............................................................83
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SCHEDULES
Schedule EG Eligible Ground Leases
Schedule 6.15 Organization Structure/Subsidiaries
Schedule 6.21 Properties
Schedule 6.25 Eligible Unencumbered Property Subsidiaries
Schedule 8.2 Existing Liens
Schedule 8.6 Excluded Investments
Schedule 11.1 Notices
EXHIBITS
Exhibit 1.1(a) Pro Rata Shares
Exhibit 2.1(b) Form of Notice of Borrowing
Exhibit 2.1(d) Form of Notice of Continuation/Conversion
Exhibit 2.1(f) Form of Note
Exhibit 7.1(c) Form of Officer's Certificate
Exhibit 7.12 Form of Guaranty
Exhibit 11.3 Form of Assignment Agreement
TERM LOAN AGREEMENT
THIS TERM LOAN AGREEMENT (as amended, supplemented or otherwise
modified from time to time, this "LOAN AGREEMENT") is entered into as of January
5, 2006 among BRANDYWINE REALTY TRUST ("BRT"), a Maryland real estate investment
trust, and BRANDYWINE OPERATING PARTNERSHIP, L.P. ("BOP"), a Delaware limited
partnership (collectively, the "BORROWERS"), the Lenders (as defined herein) and
JPMORGAN CHASE BANK, N.A., as Administrative Agent for the Lenders.
RECITALS
WHEREAS, the Borrowers desire that the Lenders provide a term loan
facility in an aggregate amount of $750,000,000; and
WHEREAS, the Lenders party hereto have agreed to make the requested
term loan facility available to the Borrowers on the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1.
DEFINITIONS AND ACCOUNTING TERMS
1.1 DEFINITIONS.
As used herein, the following terms shall have the meanings herein
specified unless the context otherwise requires. Defined terms herein shall
include in the singular number the plural and in the plural the singular:
"ACQUISITION" means the acquisition by merger by BRT of Prentiss in
accordance with the terms of the Acquisition Purchase Agreement.
"ACQUISITION PURCHASE AGREEMENT" means that certain Agreement and Plan
of Merger, dated as of October 3, 2005, among the Borrowers, Prentiss and
certain other parties.
"ADJUSTED BASE RATE" means the Base Rate plus 0.25% per annum.
"ADJUSTED EURODOLLAR RATE" means the Eurodollar Rate plus the
Applicable Percentage.
"ADJUSTED NOI" means NOI less (a) an annual sum of $.25 per square foot
for all Properties and (b) all interest income of the Combined Parties for the
applicable period.
"ADMINISTRATIVE AGENT" means JPMorgan Chase Bank, N.A. or any successor
administrative agent appointed pursuant to Section 10.9.
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly controlling (including but not limited to all directors
and officers of such Person), controlled by or under direct or indirect common
control with such Person. A Person shall be deemed to control a corporation,
partnership, limited liability company or real estate investment trust if such
Person possesses, directly or indirectly, the power (i) to vote 10% or more of
the securities having ordinary voting power for the election of directors of
such corporation or real estate investment trust or to vote 10% or more of the
partnership or membership interests of such partnership or limited liability
company or (ii) to direct or cause direction of the management and policies of
such corporation, trust, limited liability company or partnership, whether
through the ownership of voting securities, as managing member or general
partner, by contract or otherwise.
"AGENCY SERVICES ADDRESS" means 1111 Fannin, 10th Floor, Houston, TX
77002 Attn: Loan and Agency, or such other address as may be identified by
written notice from the Administrative Agent to the Borrowers.
"AGENT-RELATED PERSONS" means the Administrative Agent (including any
successor administrative agent), together with its Affiliates (including, in the
case of JPMorgan Chase Bank, N.A. in its capacity as Administrative Agent, J.P.
Morgan Securities Inc.), and the officers, directors, employees, agents and
attorneys-in-fact of such Persons and Affiliates.
"ANNUALIZED MODIFIED ADJUSTED NOI" means an amount equal to (a)
Adjusted NOI for the prior fiscal quarter for all Properties owned during such
entire fiscal quarter multiplied times four plus (b) Adjusted NOI for the number
of days owned for all Properties acquired during such fiscal quarter multiplied
by a fraction equal to 365 divided by the number of days such Property was owned
by a Combined Party.
"APPLICABLE PERCENTAGE" means if either (i) BRT has at least two
Unsecured Senior Debt Ratings in effect or (ii) BOP has at least two Unsecured
Senior Debt Ratings in effect, the appropriate applicable percentages
corresponding to the Pricing Level in the table below based upon the lowest
Unsecured Senior Debt Ratings of (A) BRT, if BRT has at least two Unsecured
Senior Debt Ratings in effect and BOP does not, (B) BOP, if BOP has at least two
Unsecured Senior Debt Ratings in effect and BRT does not or (C) if both BRT and
BOP have at least two Unsecured Senior Debt Ratings in effect, the Borrower with
the lowest Unsecured Senior Debt Rating, in each case as of the most recent
Calculation Date; provided that (x) if either or both of BOP or BRT has three
Unsecured Senior Debt Ratings in effect, the appropriate applicable percentages
shall correspond to the Pricing Level based on the lower Unsecured Senior Debt
Rating of the two highest Unsecured Senior Debt Ratings of the applicable
Borrower under clauses (A), (B) and (C) above and (y) if neither BOP nor BRT has
at least two Unsecured Senior Debt Ratings in effect, the Applicable Percentage
shall be based on Pricing Level II below:
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Applicable Percentage for
Pricing Level Unsecured Senior Debt Rating Eurodollar Loans
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I BBB- or better from S&P 1.00%
Baa3 or better from Moody's or
BBB- or better from Fitch
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II <BBB- from S&P 1.35%
<Baa3 from Moody's or
<BBB- from Fitch
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The Applicable Percentage for Loans shall be determined and adjusted on
the date (each a "CALCULATION DATE") BRT or BOP obtains at least two Unsecured
Senior Debt Ratings or the date there is a change in any Unsecured Senior Debt
Rating of BRT or BOP that would cause a change in the Applicable Percentage, in
each case promptly after the Administrative Agent receives notice regarding such
Unsecured Senior Debt Rating. Each Applicable Percentage shall be effective from
one Calculation Date until the next Calculation Date.
The Borrowers shall promptly deliver to the Administrative Agent, at
the address set forth on Schedule 11.1 and at the Agency Services Address,
information regarding any change in the Unsecured Senior Debt Rating that would
change the existing Pricing Level for the Applicable Percentage as set forth
above.
"ARRANGER" means J.P. Morgan Securities Inc., in its capacity as lead
arranger and sole bookrunner.
"BANKRUPTCY CODE" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"BASE RATE" means, for any day, the rate per annum equal to the greater
of (a) the Federal Funds Rate in effect on such day plus 1/2 of 1% or (b) the
Prime Rate in effect on such day. Any change in the Base Rate due to a change in
the Prime Rate or the Federal Funds Rate shall be effective on the effective
date of such change in the Prime Rate or the Federal Funds Rate, respectively.
"BASE RATE LOAN" means a Loan bearing interest based on a rate
determined by reference to the Base Rate.
"BOP" means Brandywine Operating Partnership, L.P., a Delaware limited
partnership, together with any successors and permitted assigns.
"BORROWERS" means BRT and BOP and "BORROWER" means either one of them.
"BRT" means Brandywine Realty Trust, a Maryland real estate investment
trust, together with any successors and permitted assigns.
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"BUSINESS DAY" means any day other than a Saturday, a Sunday, a legal
holiday or a day on which banking institutions are authorized or required by law
or other governmental action to close in New York, New York; provided that in
the case of Eurodollar Loans, such day is also a day on which dealings between
banks are carried on in Dollar deposits in the London interbank market.
"CALCULATION DATE" has the meaning set forth in the definition of
Applicable Percentage in this Section 1.1.
"CAPITAL EXPENDITURES" means all expenditures of the Borrowers and
their Subsidiaries which, in accordance with GAAP, would be classified as
capital expenditures, including, without limitation, Capital Leases.
"CAPITAL LEASE" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) by that Person as lessee which, in
accordance with GAAP, is or should be accounted for as a capital lease on a
balance sheet of that Person.
"CAPITAL MARKETS TRANSACTION" means the issuance by the Borrowers or
any Material Subsidiary after the Closing Date of (a) debt securities (excluding
mortgage financings or borrowings under the Revolving Credit Facility, the
Interim Facility or this Loan Agreement) or (b) common or preferred equity or
equity equivalent securities, including partnership interests, limited liability
company interests and convertible securities (however designated, and whether
voting or non-voting, but excluding equity not issued for the purpose of raising
cash (including, but not limited to, equity issued upon exercise of options or
upon awards to company executives or trustees, equity issued under any dividend
reinvestment plan and equity securities issued in private placements to a
limited number of investors in connection with joint venture transactions))
issued in the public or private capital markets.
"CAPITAL PERCENTAGE" means, with respect to the interest of a Borrower
or one of its Subsidiaries in another Person, the percentage interest of such
Person based on the aggregate amount of net capital contributed by such Borrower
or such Subsidiary in such Person at the time of determination relative to all
capital contributions made in such Person at such time of determination.
"CAPITALIZATION RATE" means 8.50%.
"CASH EQUIVALENTS" means (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition, (b) Dollar denominated time and
demand deposits and certificates of deposit of (i) any Lender or any of its
Affiliates, (ii) any domestic commercial bank having capital and surplus in
excess of $500,000,000 or (iii) any bank whose short-term commercial paper
rating from S&P is at least A-1 or the equivalent thereof or from Moody's is at
least P-1 or the equivalent thereof (any such bank being an "Approved Bank"), in
each case with maturities of not more than 270 days from the date of
acquisition, (c) commercial paper and variable or fixed rate notes issued by any
Approved Bank (or by the parent company thereof) or any variable rate notes
issued by, or guaranteed by, any domestic corporation rated A-1 (or the
equivalent thereof) or better by S&P or P-1 (or the equivalent thereof) or
better by Moody's and maturing within six months of the date of acquisition, (d)
4
repurchase agreements with a bank or trust company (including any of the
Lenders) or securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by the United
States of America in which a Borrower or one of its Subsidiaries shall have a
perfected first priority security interest (subject to no other Liens) and
having, on the date of purchase thereof, a fair market value of at least 100% of
the amount of the repurchase obligations and (e) Investments, classified in
accordance with GAAP as current assets, in money market investment programs
registered under the Investment Company Act of 1940, as amended, which are
administered by financial institutions having capital of at least $500,000,000
and the portfolios of which are limited to investments of the character
described in the foregoing subdivisions (a) through (d).
"CHANGE OF CONTROL" means any of the following events:
(a) any "person" or "group" (within the meaning of Section
13(d) or 14(d) of the Exchange Act) has become, directly or indirectly,
the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act, except that a Person shall be deemed to have "beneficial
ownership" of all shares that any such Person has the right to acquire,
whether such right is exercisable immediately or only after the passage
of time or the occurrence of any contingency), by way of merger,
consolidation or otherwise, of 20% or more of the voting power of BRT
on a fully-diluted basis, after giving effect to the conversion and
exercise of all outstanding warrants, options and other securities of
BRT convertible into or exercisable for voting power of BRT (whether or
not such securities are then currently convertible or exercisable); or
(b) during any period of up to twelve (12) consecutive months
commencing on or after the Closing Date, individuals who were trustees
of BRT at the beginning of such period (the "CONTINUING TRUSTEES"),
plus any new trustees whose election or appointment was approved by a
majority of the Continuing Trustees then in office, shall cease for any
reason to constitute a majority of the Board of Trustees of BRT; or
(c) BRT fails to directly own at least 75% of the aggregate
ownership interests in BOP (giving effect to any convertible interests
with respect thereto).
"CLOSING DATE" means the date hereof.
5
"CODE" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, as interpreted by the rules and regulations issued
thereunder, in each case as in effect from time to time. References to sections
of the Code shall be construed also to refer to any successor sections.
"COMBINED PARTIES" means the Borrowers and their Subsidiaries and all
joint ventures or partnerships to which a Borrower or one of its Subsidiaries is
a party.
"CONSTRUCTION-IN-PROCESS" means a Property on which construction of
improvements (excluding tenant improvements and excluding work prior to erection
of the structure of the building) has commenced and is proceeding to completion
in the ordinary course but has not yet been completed (as such completion shall
be evidenced by a temporary or permanent certificate of occupancy permitting use
of such Property by the general public). Any such Property shall be treated as
Construction-in-Process until the earlier of (i) 12 months from the date of
completion (as evidenced by a certificate of occupancy permitting use of such
Property by the general public) or (ii) such Property achieves an 85% occupancy
rate (determined on the basis of tenants paying rent).
"CONTINUING TRUSTEES" has the meaning set forth in the definition of
Change of Control.
"DEBT PAYMENTS" means, for any period, for the Combined Parties, the
sum of (a) Interest Expense for such period plus (b) all payments of principal
and any required prepayments on Funded Debt of the Combined Parties (other than
balloon payments) for such period, ending on the date of determination
(including the principal component of payments due on Capital Leases during the
applicable period ending on the date of determination).
"DEFAULT" means any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"DEFAULTING LENDER" means, at any time, any Lender that (a) has failed
to fund its Pro Rata Share of the Loans which such Lender is obligated to fund
under the terms of this Loan Agreement and such failure has not been cured as
provided in Section 3.7 (but only for so long as such failure has not been cured
as provided in Section 3.7), (b) has failed to purchase a Participation Interest
required pursuant to the terms of this Loan Agreement (but only for so long as
such Participation Interest is not purchased), (c) has failed to pay to the
Administrative Agent or any Lender an amount owed by such Lender pursuant to the
terms of this Loan Agreement (but only for so long as such amount has not been
repaid) or (d) has been deemed insolvent or has become subject to a bankruptcy
or insolvency proceeding or to a receiver, trustee or similar official.
"DOLLARS" and "$" each means the lawful currency of the United States
of America.
6
"ELIGIBLE ASSIGNEE" means (a) any Lender or any Affiliate of a Lender;
(b) a commercial bank having total assets in excess of $5,000,000,000; (c) the
central bank of any country which is a member of the Organization for Economic
Cooperation and Development; or (d) a finance company or other financial
institution reasonably acceptable to the Administrative Agent, which is
regularly engaged in making, purchasing or investing in loans and having total
assets in excess of $500,000,000 or is otherwise acceptable to the
Administrative Agent. Neither a Borrower nor any Affiliate of the Borrowers
shall qualify as an Eligible Assignee.
"ELIGIBLE GROUND LEASE" means a ground lease that (a) has a minimum
remaining term of twenty-five (25) years, including tenant controlled options,
as of any date of determination, (b) has customary notice rights, default cure
rights, bankruptcy new lease rights and other customary provisions for the
benefit of a leasehold mortgagee or has equivalent protection for a leasehold
permanent mortgagee by a subordination to such leasehold permanent mortgagee of
the landlord's fee interest, and (c) is otherwise acceptable for non-recourse
leasehold mortgage financing under customary prudent lending requirements. The
Eligible Ground Leases as of the date of this Loan Agreement are listed on
Schedule EG.
"ELIGIBLE LAND" means undeveloped land which is zoned for office or
industrial use and which is not subject to a building moratorium or other
restriction on construction.
"ELIGIBLE SUBSIDIARY" means any Subsidiary of the Borrowers which has
no Recourse Indebtedness and has not provided a guaranty of any other Funded
Debt of the Borrowers.
"ELIGIBLE UNENCUMBERED PROPERTY SUBSIDIARY" means an Eligible
Subsidiary that owns or ground-leases any Property that is treated as
Unencumbered Property, Unencumbered Construction-in-Process or Unencumbered
Eligible Land under this Agreement.
"ENVIRONMENTAL CLAIM" means any investigation, written notice,
violation, written demand, written allegation, action, suit, injunction,
judgment, order, consent decree, penalty, fine, lien, proceeding, or written
claim whether administrative, judicial or private in nature arising (a) pursuant
to, or in connection with, an actual or alleged violation of any Environmental
Law, (b) in connection with any Hazardous Material, (c) from any assessment,
abatement, removal, remedial, corrective, or other response action in connection
with an Environmental Law or other order of a Governmental Authority or (d) from
any actual or alleged damage, injury, threat, or harm to health, safety, natural
resources, or the environment.
7
"ENVIRONMENTAL LAWS" means any current or future legal requirement of
any Governmental Authority pertaining to (a) the protection of health, safety,
and the indoor or outdoor environment, (b) the conservation, management, or use
of natural resources and wildlife, (c) the protection or use of surface water
and groundwater or (d) the management, manufacture, possession, presence, use,
generation, transportation, treatment, storage, disposal, release, threatened
release, abatement, removal, remediation or handling of, or exposure to, any
hazardous or toxic substance or material or (e) pollution (including any release
to land surface water and groundwater) and includes, without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended by the Superfund Amendments and Reauthorization Act of 1986, 42
U.S.C. 9601 et seq., Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976 and Hazardous and Solid Waste Amendment of
1984, 42 U.S.C. 6901 et seq., Federal Water Pollution Control Act, as amended by
the Clean Water Act of 1977, 33 U.S.C. 1251 et seq., Clean Air Act of 1966, as
amended, 42 U.S.C. 7401 et seq., Toxic Substances Control Act of 1976, 15 U.S.C.
2601 et seq., Hazardous Materials Transportation Act, 49 U.S.C. App. 1801 et
seq., Occupational Safety and Health Act of 1970, as amended, 29 U.S.C. 651 et
seq., Oil Pollution Act of 1990, 33 U.S.C. 2701 et seq., Emergency Planning and
Community Right-to-Know Act of 1986, 42 U.S.C. 11001 et seq., National
Environmental Policy Act of 1969, 42 U.S.C. 4321 et seq., Safe Drinking Water
Act of 1974, as amended, 42 U.S.C. 300(f) et seq., any analogous implementing or
successor law, and any amendment, rule, regulation, order, or directive issued
thereunder.
"EQUITY ISSUANCE" means any issuance by a Borrower or one of its
Subsidiaries to any Person (other than another Borrower or Subsidiary) of shares
of its capital stock, preferred stock, common or preferred shares of beneficial
interest, partnership or membership interests or other equity interests,
including pursuant to the exercise of options or warrants or pursuant to the
conversion of any debt securities to equity; provided that the definition of
Equity Issuance as used herein shall not include (a) issuances of equity to
employees or trustees of a Borrower or one of its Subsidiaries to the extent
such issuances do not exceed $2,000,000 in any one instance or $10,000,000, in
the aggregate, during the term of this Loan Agreement, (b) issuances of common
stock or common or preferred shares of beneficial interests the proceeds of
which are used for the sole purpose of conversion or redemption of convertible
preferred stock or perpetual preferred stock or preferred shares of beneficial
interests, or (c) the issuance of equity interests in Brandywine Cognac I LLC to
Prudential (or its assignee) as contemplated by the Master Agreement and the
Acquisition Purchase Agreement.
"EQUITY NET CASH PROCEEDS" means, with respect to an Equity Issuance,
the gross cash proceeds received from such Equity Issuance minus actual
transaction costs and discounts of issuance payable to third parties in
connection therewith.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
8
"ERISA AFFILIATE" means an entity, whether or not incorporated, which
is under common control with a Borrower or any of its Subsidiaries within the
meaning of Section 4001(a)(14) of ERISA, or is a member of a group which
includes a Borrower or any Subsidiary of a Borrower and which is treated as a
single employer under subsections (b) or (c) of Section 414 of the Code.
"ERISA EVENT" means (i) with respect to any Plan, the occurrence of a
Reportable Event or the substantial cessation of operations (within the meaning
of Section 4062(e) of ERISA); (ii) the withdrawal of a Borrower, any Subsidiary
of a Borrower or any ERISA Affiliate from a Multiple Employer Plan during a plan
year in which it was a substantial employer (as such term is defined in Section
4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan; (iii) the
distribution of a notice of intent to terminate or the actual termination of a
Plan pursuant to Section 4041(a)(2) or 4041A of ERISA; (iv) the institution of
proceedings to terminate or the actual termination of a Plan by the PBGC under
Section 4042 of ERISA; (v) any event or condition which might constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan; (vi) the complete or partial withdrawal of a
Borrower, any Subsidiary of a Borrower or any ERISA Affiliate from a
Multiemployer Plan; (vii) the conditions for imposition of a lien under Section
302(f) of ERISA exist with respect to any Plan; or (viii) the adoption of an
amendment to any Plan requiring the provision of security to such Plan pursuant
to Section 307 of ERISA.
"EURODOLLAR LOAN" means a Loan bearing interest based on a rate
determined by reference to the Adjusted Eurodollar Rate.
"EURODOLLAR RATE" means, for the Interest Period for each Eurodollar
Loan, a per annum interest rate as determined on the basis of the offered rates
for deposits in Dollars, for the period of time comparable to such Interest
Period that appears on the Telerate page 3750 as of 11:00 a.m. London time on
the day that is two (2) Business Days preceding the first day of such Interest
Period; provided, however, if the rate described above does not appear on the
Telerate page 3750 on any applicable interest determination date, the Eurodollar
Rate shall be the rate (rounded upwards to the nearest one-hundred thousandth of
one percent, if necessary) for deposits in Dollars for a period substantially
equal to the Interest Period on the Reuters Page "LIBO" (or such other page as
may replace the LIBO Page on that service for the purpose of displaying such
rates), as of 11:00 a.m. (London Time), on the day that is two (2) Business Days
prior to the beginning of such Interest Period. If both the Dow Jones Market
Service and Reuters systems are unavailable, then the rate for that date will be
determined on the basis of the offered rates for deposits in Dollars in an
amount comparable to the principal amount of such Loan and for a period of time
comparable to such Interest Period which are offered by four major banks in the
London interbank market at approximately 11:00 a.m. London time, on the day that
is two (2) Business Days preceding the first day of such Interest Period as
selected by Administrative Agent. The principal London office of each of the
four major London banks will be requested to provide a quotation of its Dollar
deposit offered rate. If at least two such quotations are provided, the rate for
that date will be the arithmetic mean of the quotations. If fewer than two
9
quotations are provided, the rate for that date will be determined on the basis
of the rates quoted for loans in Dollars to leading European banks in an amount
comparable to the principal amount of such Loan and for a period of time
comparable to such Interest Period offered by major banks in New York City at
approximately 11:00 a.m. (New York City time), on the day that is two (2)
Business Days preceding the first day of such Interest Period. In the event that
Administrative Agent is unable to obtain any such quotation as provided above,
it will be deemed that the Eurodollar Rate for a Eurodollar Loan cannot be
determined and the provisions of Section 3.10 shall apply. In the event that the
Board of Governors of the Federal Reserve System shall impose a Eurodollar
Reserve Percentage with respect to Eurodollar deposits of the Person serving as
the Administrative Agent, then for any period during which such Eurodollar
Reserve Percentage shall apply, the Eurodollar Rate shall be equal to the amount
determined above divided by an amount equal to 1 minus the Eurodollar Reserve
Percentage.
"EURODOLLAR RESERVE PERCENTAGE" means, for any day, that percentage
(expressed as a decimal) which is in effect from time to time under Regulation D
as the maximum reserve requirement (including, without limitation, any basic,
supplemental, emergency, special, or marginal reserves) applicable with respect
to Eurodollar liabilities as that term is defined in Regulation D (or against
any other category of liabilities that includes deposits by reference to which
the interest rate on Eurodollar Loans is determined) with respect to member
banks of the Federal Reserve System, whether or not any Lender has any
Eurodollar liabilities subject to such reserve requirement at that time.
Eurodollar Loans shall be deemed to constitute Eurodollar liabilities and as
such shall be deemed subject to reserve requirements without benefits of credits
for proration, exceptions or offsets that may be available from time to time to
a Lender. The Adjusted Eurodollar Rate shall be adjusted automatically on and as
of the effective date of any change in the Eurodollar Reserve Percentage.
"EVENT OF DEFAULT" means any of the events or circumstances described
in Section 9.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
modified, succeeded or replaced from time to time, and the rules and regulations
promulgated thereunder.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upward, at the discretion of the Administrative Agent, to the nearest 1/100th of
1%) equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided that (a) if such day is
not a Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day and (b) if no such rate is
so published on such next preceding Business Day, the Federal Funds Rate for
such day shall be the average rate quoted to the Administrative Agent on such
day on such transactions as determined by the Administrative Agent.
10
"FEE LETTER" means that certain letter agreement, dated as of October
3, 2005 between the Administrative Agent and BRT, as amended, modified,
supplemented or replaced from time to time.
"FITCH" means Fitch Ratings or any successor or assignee of the
business of such company in the business of rating securities.
"FIXED CHARGE COVERAGE RATIO" means, for any period, the ratio of (a)
Adjusted NOI for such period to (b) the sum of Debt Payments for such period
plus all dividends on preferred shares of beneficial interest of BRT or
preferred operating partnership units of BOP (not owned by BRT) for such period
plus any letter of credit fees for such period.
"FUNDED DEBT" means, without duplication, the sum of (a) all
Indebtedness of the Combined Parties for borrowed money, (b) all purchase money
Indebtedness of the Combined Parties, (c) the principal portion of all
obligations of the Combined Parties under Capital Leases, (d) all obligations,
contingent or otherwise, relative to the face amount of all letters of credit
(other than letters of credit supporting trade payables in the ordinary course
of business), whether or not drawn, and banker's acceptances issued for the
account or upon the application of a Combined Party (it being understood that,
to the extent an undrawn letter of credit supports another obligation
constituting Indebtedness, in calculating aggregated Funded Debt only such other
obligation shall be included), (e) all Guaranty Obligations of the Combined
Parties with respect to the indebtedness of another Person of the types
described in this definition, (f) all indebtedness of another Person of the
types described in this definition that is secured by a Lien on any property of
the Combined Parties whether or not such indebtedness has been assumed by a
Combined Party, (g) the principal balance outstanding under any synthetic lease,
tax retention operating lease, off-balance sheet loan or similar off-balance
sheet financing product of a Combined Party where such transaction is considered
borrowed money indebtedness for tax purposes but is classified as an operating
lease in accordance with GAAP, (h) all obligations of the Combined Parties in
respect of interest rate protection agreements, foreign currency exchange
agreements or other interest or exchange rate or commodity price hedging
agreements and (i) all take out loan commitments to the extent such take out
commitment is not supported by a financial commitment from a third party
containing standard terms and conditions; provided that Funded Debt shall not
include intercompany items or trade payables incurred in the ordinary course of
business; and provided further that, for purposes of calculating the Leverage
Ratio, the Secured Debt Ratio, the Unsecured Debt limitation and the
Unencumbered Cash Flow Ratio, to the extent Funded Debt includes Indebtedness in
respect of Construction-in-Process, the amount of such Funded Debt shall be
deemed to be the total construction costs incurred for the
Construction-in-Process as of such date. The calculation of Funded Debt of the
Combined Parties shall be subject to Section 1.4.
11
"FUNDING DATE" means the date, on or after the Closing Date, on which
all of the conditions set forth in Section 5.1 and Section 5.2 have been
satisfied (or waived) in a manner satisfactory to the Administrative Agent and
the Lenders and on which the Term Loans under this Loan Agreement are made by
the Lenders to the Borrowers.
"FUNDS FROM OPERATIONS", when used with respect to any Person, shall
have the meaning given to such term in, and shall be calculated in accordance
with, standards promulgated by the National Association of Real Estate
Investment Trusts in effect from time to time.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to Section 1.3.
"GOVERNMENTAL AUTHORITY" means any Federal, state, local or provincial
court or governmental agency, authority, instrumentality or regulatory body.
"GUARANTORS" means any Persons who may from time to time execute a
Guaranty, as required by Section 7.12 or otherwise, together with their
successors and assigns; in each case unless released as a Guarantor pursuant to
Section 8.5(b) or Section 11.19.
"GUARANTY" means a guaranty of payment provided by a Subsidiary of a
Borrower in favor of the Administrative Agent and the Lenders in the form of
Exhibit 7.12.
"GUARANTY OBLIGATIONS" means, with respect to any Person, without
duplication, any obligations (other than endorsements in the ordinary course of
business of negotiable instruments for deposit or collection) guaranteeing or
intended to guarantee any Indebtedness of any other Person in any manner,
whether direct or indirect, and including without limitation any obligation,
whether or not contingent, (a) to purchase any such Indebtedness or other
obligation or any property constituting security therefor, (b) to advance or
provide funds or other support for the payment or purchase of such Indebtedness
or obligation or to maintain working capital, solvency or other balance sheet
condition of such other Person (including, without limitation, maintenance
agreements, comfort letters, take or pay arrangements, put agreements or similar
agreements or arrangements) for the benefit of the holder of Indebtedness of
such other Person, (c) to lease or purchase property, securities or services
primarily for the purpose of assuring the owner of such Indebtedness or (d) to
otherwise assure or hold harmless the owner of such Indebtedness or obligation
against loss in respect thereof. The amount of any Guaranty Obligation hereunder
shall (subject to any limitations set forth therein) be deemed to be an amount
equal to the outstanding principal amount (or maximum principal amount, if
larger) of the Indebtedness in respect of which such Guaranty Obligation is
made. It is understood and agreed that for purposes of any "completion guaranty"
provided by a Borrower or one of its Subsidiaries, the amount of Indebtedness
associated with such completion guaranty shall be none unless such completion
guaranty is enforced (or written notice of the intent to enforce such completion
guaranty has been received) at which time the Indebtedness associated with such
completion guaranty shall equal the remaining cost to complete the project plus
ten percent until such time as a certificate of occupancy is issued.
12
"HAZARDOUS MATERIALS" means any substance, material or waste defined or
regulated in or under any Environmental Laws.
"INCENTIVE STOCK PLAN" means the BRT Amended and Restated 1997
Long-Term Incentive Plan, as amended from time to time, and any other equity
incentive plan hereafter established by BRT or one of its Subsidiaries pursuant
to which awards of equity interests in BRT or such Subsidiary may be made to
employees of BRT or one of its Subsidiaries.
"INDEBTEDNESS" of any Person means, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made, (c) all obligations of such Person
under conditional sale or other title retention agreements relating to property
purchased by such Person to the extent of the value of such property (other than
customary reservations or retentions of title under agreements with suppliers
entered into in the ordinary course of business), (d) all obligations of such
Person issued or assumed as the deferred purchase price of property or services
purchased by such Person which would appear as liabilities on a balance sheet of
such Person, (e) all Indebtedness of others secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production from,
property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, (f) all Guaranty Obligations of such Person,
(g) the principal portion of all obligations of such Person under (i) Capital
Leases and (ii) any synthetic lease, tax retention operating lease, off-balance
sheet loan or similar off-balance sheet financing product of such Person where
such transaction is considered borrowed money indebtedness for tax purposes but
is classified as an operating lease in accordance with GAAP, (h) all obligations
of such Person in respect of interest rate protection agreements, foreign
currency exchange agreements, or other interest or exchange rate or commodity
price hedging agreements, (i) the maximum amount of all performance and standby
letters of credit issued or bankers' acceptances facilities created for the
account or upon the application of such Person and, without duplication, all
drafts drawn thereunder (to the extent unreimbursed), (j) all preferred stock
issued by such Person and required by the terms thereof to be redeemed, or for
which mandatory sinking fund payments are due, by a fixed date; provided that
Indebtedness shall not include preferred stock which carries a defined term if
its conversion or redemption occurs solely through the issuance of additional
equity or from the proceeds of an equity offering, (k) all obligations evidenced
by take out commitments, (l) the aggregate amount of uncollected accounts
receivables of such Person subject at such time to a sale of receivables (or
similar transaction) regardless of whether such transaction is effected without
recourse to such Person or in a manner that would not be reflected on the
balance sheet of such Person in accordance with GAAP and (m) all obligations of
13
such Person to repurchase any securities which repurchase obligation is related
to the issuance thereof, including, without limitation, obligations commonly
known as residual equity appreciation potential shares or forward equity
purchase contracts; provided, however, that Indebtedness shall not include
intercompany items or trade payables incurred in the ordinary course of
business. Subject to Section 1.4, the Indebtedness of any Person shall include
the Indebtedness of any partnership or unincorporated joint venture in which
such Person is legally obligated or has a reasonable expectation of being liable
with respect thereto.
"INDENTURE" means the Indenture and First Supplemental Indenture dated
as of October 22, 2004 and May 25, 2005, respectively, among BOP, as Issuer,
BRT, as Parent Guarantor, and The Bank of New York, as Trustee.
"INTEREST COVERAGE RATIO" means, for any period, the ratio of (a)
Adjusted NOI for such period to (b) Interest Expense for such period.
"INTEREST EXPENSE" means, for any period, with respect to the Combined
Parties, all net interest expense, whether paid or accrued (including that
portion applicable to Capital Leases in accordance with GAAP) plus capitalized
interest.
"INTEREST PAYMENT DATE" means (a) as to Base Rate Loans, the last
Business Day of each month and the Loan Maturity Date, (b) as to any Eurodollar
Loan, the last day of such Eurodollar Loan's Interest Period and the Loan
Maturity Date.
"INTEREST PERIOD" means, as to Eurodollar Loans, a period of one, two
or three months' duration as the Borrowers may elect commencing, in each case,
on the date of the borrowing (including, as applicable, continuations and
conversions thereof); provided, however, (a) if any Interest Period would end on
a day which is not a Business Day, such Interest Period shall be extended to the
next succeeding Business Day (except that where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding Business
Day), (b) no Interest Period shall extend beyond the Loan Maturity Date, and (c)
where an Interest Period begins on a day for which there is no numerically
corresponding day in the calendar month in which the Interest Period is to end,
such Interest Period shall end on the last Business Day of such calendar month.
"INTEREST RATE HEDGES" has the meaning set forth in Section 7.13.
"INTERIM FACILITY" means the up to $100,000,000 Interim Loan Agreement
that the Borrowers and JPMorgan Chase Bank, N.A. and certain other parties may
enter into on or about the date of the Acquisition.
14
"INVESTMENT" in any Person means (a) the acquisition (whether for cash,
property, services, assumption of Indebtedness, securities or otherwise) of
assets, shares of capital stock, bonds, notes, debentures, partnership
interests, membership interests, joint ventures or other ownership interests or
other securities of such other Person or (b) any deposit with, or advance, loan
or other extension of credit to, such Person (other than deposits made in
connection with the purchase of equipment or other assets in the ordinary course
of business) or (c) any other capital contribution to or investment in such
Person, including, without limitation, any Guaranty Obligation (including any
support for a letter of credit issued on behalf of such Person) incurred for the
benefit of such Person.
"LENDER" means the Person serving as the Administrative Agent, any of
the other financial institutions party to this Loan Agreement, or any other
Person which may provide an additional Loan and become a party to this Loan
Agreement or becomes an assignee of any rights to a Lender pursuant to Section
11.3, together with their successors and permitted assigns.
"LEVERAGE RATIO" means the ratio of (a) Funded Debt to (b) the sum (the
"TOTAL ASSET VALUE") of (i) Property Value plus (ii) all unrestricted cash of
the Combined Parties plus (iii) all Cash Equivalents of the Combined Parties
plus (iv) all unrestricted tenant security deposits held by the Combined Parties
plus (v) the aggregate of all amounts of the Combined Parties incurred and paid
with respect to Construction-in-Process and Eligible Land, which credit will be
limited to 20% of Total Asset Value in the aggregate and 15% of Total Asset
Value for any single project or parcel, plus (vi) all notes receivable of the
Combined Parties, which credit will be limited to 5% of Total Asset Value, plus
(vii) all investments of the Combined Parties in (based on the actual cash
investment in), directly or indirectly, entities (other than Combined Parties)
holding real estate assets, which credit will be limited to 2.5% of Total Asset
Value; provided that (A) the amount included in Total Asset Value pursuant to
clause (b)(i) above with respect to any Pre-Stabilized Acquisition Property
shall be the higher of (x) 50% of the value at cost to the Combined Parties of
such Pre-Stabilized Acquisition Property or (y) the Property Value of such
Pre-Stabilized Acquisition Property and (B) from the Closing Date through
December 31, 2006, the amount included in Total Asset Value pursuant to clause
(b)(i) above with respect to the Property known as Cira Centre in Philadelphia,
Pennsylvania shall be calculated by using the pro-forma Property Value of such
Property based on executed leases for such Property.
"LIEN" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, security interest, encumbrance, lien (statutory or otherwise),
preference, priority or charge of any kind, including, without limitation, any
agreement to give any of the foregoing, any conditional sale or other title
retention agreement, and any lease in the nature thereof.
15
"LOAN" or "LOANS" means a Term Loan made by a Lender pursuant to
Section 2.1; provided, that if any such loan or loans (or portions thereof) are
combined or subdivided pursuant to a Notice of Conversion/Continuation, the term
"Loan" shall refer to the combined principal amount resulting from such
combination or to each of the separate principal amounts resulting from such
subdivision, as the case may be.
"LOAN DOCUMENTS" means this Loan Agreement, the Notes, each Guaranty
(if any), the Notice of Borrowing, any Notice of Continuation/Conversion and all
other related agreements and documents issued or delivered hereunder or
thereunder or pursuant hereto or thereto.
"LOAN MATURITY DATE" means January 4, 2007.
"LOAN PARTIES" means the Borrowers and any Guarantors and "LOAN PARTY"
means any one of them.
"MASTER AGREEMENT" means the Master Agreement, dated as of October 3,
2005 by and between BOP and Prudential.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (a) the
business, assets, operations, condition (financial or otherwise) or prospects of
BRT, BOP or the Borrowers and their Subsidiaries taken as a whole, (b) the
ability of a Borrower to perform its respective obligations under this Loan
Agreement or any of the other Loan Documents, (c) the ability of a Guarantor to
perform its respective obligations under any of the other Loan Documents, unless
the Guarantor subject to such material adverse effect could be immediately
released as a Guarantor in compliance with Section 8.5(b), or (d) the validity
or enforceability of this Loan Agreement, any of the other Loan Documents, or
the rights and remedies of the Lenders hereunder or thereunder taken as a whole.
"MATERIAL SUBSIDIARY" means any Eligible Unencumbered Property
Subsidiary and any Subsidiary of a Borrower which is a Guarantor.
"MOODY'S" means Moody's Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating securities.
"MULTIEMPLOYER PLAN" means a Plan which is a multiemployer plan as
defined in Section 3(37) or Section 4001(a)(3) of ERISA.
"MULTIPLE EMPLOYER PLAN" means a Plan (other than a Multiemployer Plan)
in which a Borrower, a Subsidiary of a Borrower or any ERISA Affiliate and at
least one employer other than a Borrower, a Subsidiary of a Borrower or any
ERISA Affiliate are contributing sponsors.
"NET INCOME" means, for any period, the net income for such period of
the Combined Parties, as determined in accordance with GAAP.
16
"NET OFFERING PROCEEDS" means all cash proceeds received by the
Borrowers or their respective Subsidiaries from a Capital Markets Transaction,
less actual costs, expenses and discounts of issuance paid by the Borrowers or
such Subsidiary, as the case may be.
"NET WORTH" means, as of any date, the net worth of the Borrowers and
their Subsidiaries on a consolidated basis, as determined in accordance with
GAAP.
"NOI" means, for any period, an amount equal to (a) Net Income for such
period (excluding the effect of any extraordinary or other non-recurring gains
or losses or other non-cash losses outside the ordinary course of business) plus
(b) an amount which in the determination of Net Income for such period has been
deducted for (i) proceeds to minority interests, (ii) income taxes, (iii)
depreciation and amortization and (iv) Interest Expense, less (c) 3% of the
total real estate revenue of the Combined Parties as a property management
expense.
"NON-EXCLUDED TAXES" has the meaning set forth in Section 3.13.
"NON-RECOURSE INDEBTEDNESS" means any Indebtedness: (a) under the terms
of which the payee's remedies upon the occurrence of an event of default are
limited to specific, identified assets of the payor which secure such
Indebtedness and (b) for the repayment of which neither a Borrower nor any
Subsidiary of a Borrower (other than a special purpose Subsidiary of a Borrower
which owns such assets) has any personal liability beyond the loss of such
specified assets, except for liability for fraud, material misrepresentation or
misuse or misapplication of insurance proceeds, condemnation awards, existence
of hazardous wastes or other customary exceptions to non-recourse provisions.
"NOTE" or "NOTES" means the promissory notes of the Borrowers in favor
of each of the Lenders evidencing the Loans provided pursuant to Section 2.1,
individually or collectively, as appropriate, as such promissory notes may be
amended, modified, supplemented, extended, renewed or replaced from time to time
and in the form of Exhibit 2.1(f).
"NOTICE OF BORROWING" means the request by the Borrowers for the Loans,
in the form of Exhibit 2.1(b).
"NOTICE OF CONTINUATION/CONVERSION" means a request by the Borrowers to
continue an existing Eurodollar Loan to a new Interest Period or to convert a
Eurodollar Loan to a Base Rate Loan or to convert a Base Rate Loan to a
Eurodollar Loan, in the form of Exhibit 2.1(d).
"OBLIGATIONS" means, without duplication, all of the obligations,
liabilities and indebtedness of the Loan Parties to the Lenders and the
Administrative Agent, whenever arising, under this Loan Agreement, the Notes or
any of the other Loan Documents to which a Loan Party is a party, including
without limitation the outstanding principal amount of the Loans.
17
"PARTICIPATION INTEREST" means a Loan by a Lender by way of a purchase
of a participation in any Loans as provided in Section 3.8.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereto.
"PERMITTED INVESTMENTS" means, subject in all cases to Sections 7.10,
7.15 and 8.5(b), Investments which are (a) cash or Cash Equivalents, (b)
accounts receivable and accrued rents receivable created, acquired or made in
the ordinary course of business and payable or dischargeable in accordance with
customary trade terms, (c) Investments by a Borrower or one of its Subsidiaries
in another Borrower or Subsidiary, (d) earnest money and similar deposits in
respect of Properties made in the ordinary course of business, (e) (i) the
Acquisition and (ii) the acquisition of other new Properties; provided that the
Borrowers and their Subsidiaries may not invest in undeveloped land in excess of
5% of Total Asset Value, in the aggregate, except for Eligible Land, (f)
Investments in joint ventures (whether or not Subsidiaries) not to exceed, in
the aggregate at any one time, 15% of Total Asset Value, (g) Investments
existing on the date hereof in certain special purpose entities listed on
Schedule 8.6, (h) Investments in Construction-in-Process in which the aggregate
full-budgeted costs of construction of all Construction-in-Process do not
exceed, in the aggregate at any one time, 20% of Total Asset Value; (i)
repurchases by a Borrower or any Subsidiary of its capital stock or shares of
beneficial interest (including the repurchase of stock or shares of beneficial
interest that is retired, cancelled or terminated) or other ownership interests
(including options, warrants and stock appreciation rights) as long as prior to
and after giving effect thereto, no Default or Event of Default exists; and (j)
Investments not otherwise described in or covered by the other subclauses of
this definition including, without limitation, loans to officers, directors and
employees; provided that (i) such Investments do not exceed, in the aggregate at
any one time, 5% of Total Asset Value and (ii) such Investments, together with
the Investments referred to in subclauses (e)(ii), (f) and (h), do not exceed
(in the aggregate at any one time) 25% of Total Asset Value.
"PERMITTED LIENS" means (a) Liens securing Obligations, (b) Liens for
taxes not yet due or Liens for taxes being contested in good faith by
appropriate proceedings for which adequate reserves determined in accordance
with GAAP have been established (and as to which the property subject to any
such Lien is not yet subject to foreclosure, sale or loss on account thereof),
(c) Liens in respect of property imposed by law arising in the ordinary course
of business such as materialmens', mechanics', warehousemens', carriers',
landlords' and other nonconsensual statutory Liens which are not yet due and
payable or which are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP have been
established (and as to which the property subject to any such Lien is not yet
subject to foreclosure, sale or loss on account thereof); (d) Liens arising from
good faith deposits in connection with or to secure performance of tenders,
bids, leases, government contracts, performance and return-of-money bonds and
other similar obligations incurred in the ordinary course of business (other
than obligations in respect of the payment of borrowed money), (e) Liens arising
from good faith deposits in connection with or to secure performance of
statutory obligations and surety and appeal bonds, (f) easements, rights-of-way,
restrictions (including zoning restrictions), matters of plat, minor defects or
irregularities in title and other similar charges or encumbrances not, in any
material respect, impairing the use of the encumbered property for its intended
18
purposes, (g) judgment Liens that would not constitute an Event of Default, (h)
Liens arising by virtue of any statutory or common law provision relating to
bankers' liens, rights of setoff or similar rights as to deposit accounts or
other funds maintained with a creditor depository institution, (i) Liens in
connection with Indebtedness permitted by Section 8.1(c); provided that if such
Lien is created with respect to an Unencumbered Property, the Borrowers shall
give the Administrative Agent written notice of the creation of such Lien in
accordance with Section 7.15(b) (if applicable), and (j) Liens existing on the
date hereof and identified on Schedule 8.2; provided that no such Lien shall
extend to any property other than the property subject thereto on the Closing
Date.
"PERSON" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other enterprise
(whether or not incorporated), or any Governmental Authority.
"PLAN" means any employee benefit plan (as defined in Section 3(3) of
ERISA) which is covered by ERISA and with respect to which a Borrower, any
Subsidiary of a Borrower or any ERISA Affiliate is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be) an
"employer" within the meaning of Section 3(5) of ERISA.
"PRENTISS" means Prentiss Properties Trust, a Maryland real estate
investment trust.
"PRE-STABILIZED ACQUISITION PROPERTIES" means the Properties located at
(i) 555 Radnor Financial Center, Radnor, Pennsylvania, (ii) 130-170 Radnor
Financial Center, Radnor, Pennsylvania and (iii) 201 Radnor Financial Center,
Radnor, Pennsylvania.
"PRICING LEVEL" means, based upon the Unsecured Senior Debt Rating of
the Borrowers, as applicable, the corresponding category (I or II) within the
Applicable Percentage table.
"PRIME RATE" means the per annum rate of interest announced publicly
from time to time by the Person that is the Administrative Agent at its
principal offices (or such other principal office of such Person as communicated
in writing to the Borrowers and the Lenders) as its Prime Rate. Any change in
the interest rate resulting from a change in the Prime Rate shall become
effective at the opening of business on the day specified in the public
announcement of such change. The Prime Rate is a rate set by the Person that is
the Administrative Agent based upon various factors including such Person's
costs and desired return, general economic conditions and other factors, and is
used as a reference point for pricing some loans, which may be priced at, above
or below such announced rate.
19
"PRIVATE PLACEMENT NOTES" means the $113,000,000 4.34% Notes issued
pursuant to that certain Note Purchase Agreement dated as of November 14, 2004,
as may be amended, restated or otherwise modified from time to time.
"PRO FORMA BASIS" means with respect to (a) the sale of a Property or
the sale of an equity interest in a Loan Party or Eligible Unencumbered Property
Subsidiary, (b) the creation of a Lien on a Property or (c) the acquisition of
or Investment in a Property or other asset that is subject to Section 7.15, that
such sale, creation of Lien, acquisition or Investment shall be deemed to have
occurred as of the first day of the four fiscal quarter period ending as of the
last day of the most recent fiscal quarter for which the Lenders have received
the financial information required by Section 7.1(b).
"PRO RATA SHARE" means, with respect to any Lender, (a) prior to the
making of the Term Loans or the expiration of the Term Loan Commitments, the
percentage set forth on Exhibit 1.1(a) and (b) after the Funding Date, the
percentage obtained by dividing (i) the aggregate amount of such Lender's Loans
(as may be adjusted from time to time in accordance with the provisions of this
Loan Agreement or any Assignment and Acceptance to which such Lender is a
party), by (ii) the aggregate amount of all of the Lenders' Loans.
"PROPERTIES" means all real properties owned or ground-leased by the
Borrowers and their Subsidiaries whether directly or through a joint venture
investment.
"PROPERTY VALUE" means Annualized Modified Adjusted NOI divided by the
Capitalization Rate; provided that for any Property owned by a Borrower or a
Subsidiary of a Borrower for fewer than twelve (12) months (including the assets
acquired in the Acquisition), the Property Value of such Property shall instead
be its value at cost to such Borrower or Subsidiary in accordance with GAAP.
"PRUDENTIAL" means The Prudential Insurance Company of America, a New
Jersey corporation and its assignees.
"RECOURSE INDEBTEDNESS" means any Indebtedness other than Non-Recourse
Indebtedness.
"REGULATION D, O, T, U, OR X" means Regulation D, O, T, U or X,
respectively, of the Board of Governors of the Federal Reserve System (or any
successor body) as from time to time in effect and any successor to all or a
portion thereof.
20
"REIT" means a real estate investment trust as defined in Sections
856-860 of the Code.
"REIT SUBSIDIARY" means a Subsidiary of the Borrowers that is a REIT.
"REPORTABLE EVENT" means any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the notice requirement has been
waived by regulation.
"REQUIRED LENDERS" means, at any time, the Lenders whose Pro Rata
Shares in the aggregate are equal to or greater than sixty-six and two-thirds
percent (66.67%); provided, however, that if any Lender is a Defaulting Lender,
"Required Lenders" means Lenders (excluding all Defaulting Lenders) whose Pro
Rata Shares represent sixty-six and two-thirds (66.67%) or more of the aggregate
Pro Rata Shares of such Lenders.
"REQUIREMENT OF LAW" means, as to any Person, the articles or
certificate of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or final,
non-appealable determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or to which
any of its material property is subject.
"REVOLVING CREDIT FACILITY" means (i) that certain Amended and Restated
Revolving Credit Agreement, dated as of December 22, 2005, among the Borrowers,
the lenders party thereto and JPMorgan Chase Bank, N.A., as the administrative
agent, and (ii) any credit facility entered into as an amendment or modification
thereto, or in substitution or replacement thereof, including any increase to
the amount which may be borrowed thereunder.
"S&P" means Standard & Poor's Ratings Group, a division of McGraw Hill,
Inc., or any successor or assignee of the business of such division in the
business of rating securities.
"SECURED DEBT" means all Funded Debt of the Combined Parties that is
subject to a Lien in favor of the creditor holding such Funded Debt; provided
that any Funded Debt owed to the Lenders hereunder shall be considered to be
Unsecured Debt even if a Lien has been granted in favor of the Lenders.
"SECURED DEBT RATIO" means the ratio of (a) Secured Debt to (b)
Property Value plus, to the extent Secured Debt includes Funded Debt on
Construction-in-Process, total construction costs incurred as of such date with
respect to such Construction-in-Process.
"SIGNIFICANT SUBSIDIARY" means any Eligible Unencumbered Property
Subsidiary, any Subsidiary of the Borrowers which is a Guarantor, and any other
Subsidiary of the Borrowers which contributes at least $25,000,000 to Total
Asset Value.
21
"SINGLE EMPLOYER PLAN" means any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan or a Multiple Employer Plan.
"SOLVENT" means, with respect to any Person as of a particular date,
that on such date (a) such Person is able to pay its debts and other
liabilities, contingent obligations and other commitments as they mature in the
normal course of business, (b) 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 in their ordinary course, (c) such
Person is not engaged in a business or a transaction, and is not about to engage
in a business or a transaction, for which such Person's assets would constitute
unreasonably small capital after giving due consideration to the prevailing
practice in the industry in which such Person is engaged or is to engage, (d)
the fair value of the assets of such Person is greater than the total amount of
liabilities, including, without limitation, contingent liabilities, of such
Person and (e) the present fair saleable value of the assets of such Person is
not less than the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and matured. In computing the
amount of contingent liabilities at any time, it is intended that such
liabilities will be computed at the amount which, 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.
"SPIN-OUT" means the transfer to Prudential of the Specified Assets (as
defined in the Merger Agreement) as provided in the Master Agreement and the
Acquisition Purchase Agreement.
"SUBSIDIARY" means, as to any Person, (a) any corporation more than 50%
of whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time, any class or classes of stock of
such corporation shall have or might have voting power by reason of the lapse of
time or the happening of any contingency) is at the time owned by such Person
directly or indirectly through Subsidiaries, and (b) any partnership,
association, joint venture, limited liability company, trust or other entity in
which such Person directly or indirectly through Subsidiaries has more than a
50% equity interest or 50% Capital Percentage at any time.
"TERM LOAN" has the meaning set forth in Section 2.1.
"TERM LOAN COMMITMENT" means, with respect to any Lender, the
obligations of such Lender to make Loans pursuant to the terms and conditions of
this Loan Agreement, and which shall not exceed the principal amount set forth
opposite such Lender's name on Exhibit 1.1(a) hereto or in the Assignment and
Acceptance by which it became a Lender, as modified from time to time pursuant
to the terms of this Loan Agreement or to give effect to any applicable
Assignment and Acceptance, and "TERM LOAN COMMITMENTS" means the aggregate
principal amount of the Term Loan Commitments of all the Lenders, the maximum
amount of which shall be $750,000,000.
22
"TERMINATION EVENT" means (a) with respect to any Single Employer Plan,
the occurrence of a Reportable Event or the substantial cessation of operations
(within the meaning of Section 4062(e) of ERISA); (b) the withdrawal of any
Borrower or any of its Subsidiaries or any ERISA Affiliate from a Multiple
Employer Plan during a plan year in which it was a substantial employer (as such
term is defined in Section 4001(a)(2) of ERISA), or the termination of a
Multiple Employer Plan; (c) the distribution of a notice of intent to terminate
or the actual termination of a Plan pursuant to Section 4041(a)(2) or 4041A of
ERISA; (d) the institution of proceedings to terminate or the actual termination
of a Plan by the PBGC under Section 4042 of ERISA; (e) any event or condition
which might reasonably constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan; or (f)
the complete or partial withdrawal of any Borrower or any of its Subsidiaries or
any ERISA Affiliate from a Multiemployer Plan.
"TOTAL ASSET VALUE" has the meaning assigned to such term in the
definition of Leverage Ratio.
"UNENCUMBERED CASH FLOW RATIO" means the ratio of (a) Annualized
Modified Adjusted NOI with respect to Unencumbered Properties to (b) Interest
Expense on Unsecured Debt for the twelve (12) month period ending on the date of
determination.
"UNENCUMBERED CONSTRUCTION-IN-PROCESS" means all
Construction-in-Process that is (i) wholly-owned by a Loan Party or an Eligible
Subsidiary that is a Wholly-Owned Subsidiary of the Borrowers, (ii) not subject
to a Lien or negative pledge other than (a) nonconsensual Permitted Liens and
(b) Liens in favor of the Lenders to secure the Obligations, and (iii) not
subject to a significant environmental release, Environmental Claim or other
violation of Environmental Laws.
"UNENCUMBERED CONSTRUCTION-IN-PROCESS AND ELIGIBLE LAND VALUE" means
the sum of Unencumbered Construction-in-Process and Unencumbered Eligible Land,
in each case valued at the lower of cost or market.
"UNENCUMBERED ELIGIBLE LAND" means all Eligible Land that is (i)
wholly-owned by a Loan Party or an Eligible Subsidiary that is a Wholly-Owned
Subsidiary of the Borrowers, (ii) not subject to a Lien or negative pledge other
than (a) nonconsensual Permitted Liens and (b) Liens in favor of the Lenders to
secure the Obligations, and (iii) not subject to a significant environmental
release, Environmental Claim or other violation of Environmental Laws.
23
"UNENCUMBERED PROPERTIES" means all Properties that are (i)
wholly-owned or leased under an Eligible Ground Lease by a Loan Party or an
Eligible Subsidiary that is a Wholly-Owned Subsidiary of the Borrowers, (ii) not
subject to a Lien or negative pledge other than (a) nonconsensual Permitted
Liens and (b) Liens in favor of the Lenders to secure the Obligations, (iii)
improved with a building that has received a certificate of occupancy, and (iv)
not subject to a significant environmental release, Environmental Claim or other
violation of Environmental Laws.
"UNENCUMBERED PROPERTY VALUE" means the sum of (i) Property Value with
respect to all Unencumbered Properties, plus (ii) the aggregate amount of
unrestricted cash and Cash Equivalents in excess of $25,000,000; provided that
Unencumbered Property Value with respect to any Pre-Stabilized Acquisition
Property (so long as such Property constitutes an Unencumbered Property) shall
be calculated by using the higher of (x) 50% of the value at cost to the
Combined Parties of such Pre-Stabilized Acquisition Property or (y) the Property
Value of such Pre-Stabilized Acquisition Property.
"UNENCUMBERED VALUE" means the sum of Unencumbered Property Value plus
Unencumbered Construction-in-Process and Eligible Land Value; provided that (i)
no property shall account for more than 15% of Unencumbered Value and (ii)
Unencumbered Construction-in-Process and Eligible Land Value shall not account
for more than 15% of Unencumbered Value.
"UNSECURED DEBT" means the sum of all Funded Debt of the Combined
Parties that was incurred, and continues to be outstanding, without granting a
Lien to the creditor holding such Funded Debt; provided that all Funded Debt of
the Combined Parties owing under the Revolving Credit Facility shall be
considered to be Unsecured Debt even if a Lien has been granted in favor of the
lenders parties thereto.
"UNSECURED SENIOR DEBT RATING" means either (a) if BRT or BOP has
issued unsecured, senior, long term, non-credit enhanced debt, the debt rating
provided by S&P, Moody's or Fitch with respect to such unsecured, senior, long
term, non-credit enhanced debt, or (b) if BRT or BOP has not issued unsecured,
senior, long term, non-credit enhanced debt, the issuer rating for BRT or BOP
provided by Moody's or Fitch or the corporate credit rating for BRT or BOP
provided by S&P.
"WHOLLY-OWNED SUBSIDIARY OF THE BORROWERS" means a Subsidiary of a
Borrower in which the Borrowers directly or indirectly own 100% of the equity
interests (excluding those equity interests that are owned by other Persons in
order to permit such Subsidiary to qualify as a REIT, so long as the Borrowers
directly or indirectly own at least 99% of the equity interests in such
Subsidiary and control decisions regarding the sale and financing of all
Properties owned by such Subsidiary).
24
1.2 COMPUTATION OF TIME PERIODS AND OTHER DEFINITION PROVISIONS.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding." References in this Loan Agreement to "Articles", "Sections",
"Schedules" or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits
of or to this Loan Agreement unless otherwise specifically provided. References
in this Loan Agreement to "during the term of this Loan Agreement" shall mean
the period from the Funding Date to the earlier of the Loan Maturity Date or the
acceleration of the Loans pursuant to Section 9.2.
1.3 ACCOUNTING TERMS.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis, and excluding the effects of consolidation of investments in non-wholly
owned subsidiaries under Interpretation No. 46 of the Financial Accounting
Standards Board. All financial statements delivered to the Lenders hereunder
shall be accompanied by a statement from the Borrowers that GAAP has not changed
since the most recent financial statements delivered by the Borrowers to the
Lenders or, if GAAP has changed, describing such changes in detail and
explaining how such changes affect the financial statements. All calculations
made for the purposes of determining compliance with this Loan Agreement shall
(except as otherwise expressly provided herein) be made by application of GAAP
applied on a basis consistent with the most recent annual or quarterly financial
statements delivered pursuant to Section 7.1 (or, prior to the delivery of the
first financial statements pursuant to Section 7.1, consistent with the
financial statements described in Section 5.2(d)); provided, however, if (a) the
Borrowers shall object to determining such compliance on such basis at the time
of delivery of such financial statements due to any change in GAAP or the rules
promulgated with respect thereto or (b) the Administrative Agent or the Required
Lenders shall so object in writing within 60 days after delivery of such
financial statements (or after the Lenders have been informed of the change in
GAAP affecting such financial statements, if later), then such calculations
shall be made on a basis consistent with the most recent financial statements
delivered by the Borrowers to the Lenders as to which no such objection shall
have been made.
1.4 JOINT VENTURE INVESTMENTS.
For purposes of calculating the financial covenants in Section 7.2
(including the definitions used therein) and the definition of Permitted
Investments, (a) NOI, Adjusted NOI, Annualized Modified Adjusted NOI, Property
Value and Interest Expense shall be calculated, to the extent applicable, to
include the pro-rata share (as determined by their respective percentage
interests in the profits and losses of such joint venture) of results
attributable to the Borrowers and their Subsidiaries from joint ventures and (b)
25
Indebtedness and Funded Debt shall be calculated as follows: (i) if the
Indebtedness of a joint venture is recourse to such Borrower (or Subsidiary),
then the amount of such Indebtedness or Funded Debt that is recourse to such
Borrower (or Subsidiary), without duplication, and (ii) if the Indebtedness of
such joint venture is not recourse to such Borrower (or Subsidiary), then such
Borrower's (or Subsidiary's) pro-rata share of such Indebtedness or Funded Debt
as determined by its percentage interest in the profits and losses of such joint
venture. For purposes of this Section 1.4, Indebtedness of a joint venture that
is recourse to a Borrower or one of its Subsidiaries solely as a result of such
Borrower (or Subsidiary) being a partner or member in such joint venture shall
be treated as not recourse to such Borrower (or Subsidiary) as long as the only
assets owned by such Borrower (or Subsidiary) are its equity interest in such
joint venture and any contributed capital held to fund such equity interest.
SECTION 2.
LOAN FACILITY
2.1 LOANS.
(a) Commitment to Lend. Subject to the terms and conditions
set forth in this Loan Agreement, each Lender hereby severally and not
jointly agrees to make a term loan in Dollars (the "TERM LOAN" and
collectively, the "TERM LOANS") to the Borrowers on the Funding Date,
in an amount equal to such Lender's Pro Rata Share of the principal
amount of $750,000,000. The aggregate amount of the Loans to be made
hereunder shall not exceed $750,000,000. The Loans shall be made by the
Lenders simultaneously and proportionately to their then respective Pro
Rata Share, it being understood that no Lender shall be responsible for
any failure by any other Lender to perform its obligation to make a
Loan hereunder nor shall the Loans of any Lender be increased or
decreased as a result of any such failure. The Term Loan Commitments
shall expire on the earlier of (i) the date on which the Loans are made
and (ii) January 30, 2006.
(b) Method of Borrowing for Loans. By no later than 11:00 a.m.
three Business Days prior to the Funding Date, the Borrowers shall
submit an irrevocable written Notice of Borrowing in the form of
Exhibit 2.1(b) to the Administrative Agent setting forth (i) the amount
requested, (ii) whether such Loans shall be Base Rate Loans or
Eurodollar Loans, (iii) with respect to Loans that will be Eurodollar
Loans, the Interest Period applicable thereto, (iv) a certification
that the Borrowers have complied in all respects with Section 5.1 and
Section 5.2 and (v) the proposed Funding Date.
26
(c) Funding of Loans. Upon receipt of the Notice of Borrowing,
the Administrative Agent shall promptly inform the Lenders as to the
terms thereof. Each Lender shall make its Pro Rata Share of the total
requested Loans available to the Administrative Agent by 1:00 p.m. on
the Funding Date specified in the Notice of Borrowing by deposit, in
Dollars, of immediately available funds to the Administrative Agent at
its principal office in New York City, New York or at such other
address as the Administrative Agent may designate in writing. The
amount of the requested Loans will then be made available to the
Borrowers by the Administrative Agent by crediting the account of the
Borrowers on the books of such office of the Administrative Agent, to
the extent the amount of the requested Loans are made available to the
Administrative Agent.
No Lender shall be responsible for the failure or delay by any
other Lender in its obligation to make Loans hereunder; provided,
however, that the failure of any Lender to fulfill its obligations
hereunder shall not relieve any other Lender of its obligations
hereunder. Unless the Administrative Agent shall have been notified by
any Lender prior to the Funding Date that such Lender does not intend
to make available to the Administrative Agent its portion of the Loans
to be made on such date, the Administrative Agent may assume that such
Lender has made such amount available to the Administrative Agent on
the Funding Date, and the Administrative Agent in reliance upon such
assumption, may (in its sole discretion but without any obligation to
do so) make available to the Borrowers a corresponding amount. If such
corresponding amount is not in fact made available to the
Administrative Agent, the Administrative Agent shall be able to recover
such corresponding amount from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent will promptly notify the
Borrowers, and the Borrowers shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also
be entitled to recover from such Lender or the Borrowers, as the case
may be, interest on such corresponding amount in respect of each day
from the date such corresponding amount was made available by the
Administrative Agent to the Borrowers to the date such corresponding
amount is recovered by the Administrative Agent at a per annum rate
equal to (i) from the Borrowers at the applicable rate for such Loan
pursuant to the Notice of Borrowing and (ii) from such Lender at the
Federal Funds Rate.
(d) Continuations and Conversions. The Borrowers shall have
the option with respect to any Loan, on any Business Day, to continue
existing Eurodollar Loans for a subsequent Interest Period, to convert
Base Rate Loans into Eurodollar Loans, or to convert Eurodollar Loans
into Base Rate Loans; provided, however, that (i) each such
continuation or conversion must be requested by the Borrowers pursuant
to a written Notice of Continuation/Conversion, in the form of Exhibit
2.1(d), in compliance with the terms set forth below, (ii) except as
provided in Section 3.11, Eurodollar Loans may only be continued or
converted on the last day of the Interest Period applicable thereto,
(iii) Eurodollar Loans may not be continued nor may Base Rate Loans be
converted into Eurodollar Loans during the existence and continuation
of a Default or Event of Default and (iv) any request to continue a
27
Eurodollar Loan that fails to comply with the terms hereof or any
failure to request a continuation of a Eurodollar Loan at the end of an
Interest Period shall result in a conversion of such Eurodollar Loan to
a Base Rate Loan on the last day of the applicable Interest Period.
Each continuation or conversion must be requested by the Borrowers no
later than 11:00 a.m. (A) one Business Day prior to the date for a
requested conversion of a Eurodollar Loan to a Base Rate Loan or (B)
three Business Days prior to the date for a requested continuation of a
Eurodollar Loan or conversion of a Base Rate Loan to a Eurodollar Loan,
in each case pursuant to a written Notice of Continuation/Conversion
submitted to the Administrative Agent (which shall promptly notify each
of the Lenders) which shall set forth (x) whether the Borrowers wish to
continue or convert such Loans and (y) if the request is to continue a
Eurodollar Loan or convert a Loan to a Eurodollar Loan, the Interest
Period applicable thereto.
(e) Minimum Amounts/Restrictions on Loans. Each request for a
conversion or continuation of a Loan shall be subject to the
requirements that (i) each Eurodollar Loan shall be in a minimum amount
of $1,000,000 and in integral multiples of $100,000 in excess thereof
and (ii) no more than eight Eurodollar Loans shall be outstanding at
any one time. For the purposes of this Section 2.1(e), all Eurodollar
Loans with the same Interest Periods beginning on the same date shall
be considered as one Eurodollar Loan, but Eurodollar Loans with
different Interest Periods, even if they begin or end on the same date,
shall be considered as separate Eurodollar Loans.
(f) Notes. The Loans made by each Lender shall be evidenced by
a duly executed promissory note of the Borrowers to each Lender in
substantially the form of Exhibit 2.1(f).
2.2 JOINT AND SEVERAL LIABILITY OF THE BORROWERS.
(a) Each of the Borrowers is accepting joint and several
liability hereunder in consideration of the financial accommodation to
be provided by the Lenders under this Loan Agreement, for the mutual
benefit, directly and indirectly, of each of the Borrowers and in
consideration of the undertakings of each of the Borrowers to accept
joint and several liability for the obligations of each of them.
(b) Each of the Borrowers jointly and severally hereby
irrevocably and unconditionally accepts, not merely as a surety but
also as a co-debtor, joint and several liability with the other
Borrower with respect to the payment and performance of all of the
Obligations arising under this Loan Agreement and the other Loan
Documents, it being the intention of the parties hereto that all the
Obligations shall be the joint and several obligations of each of the
Borrowers without preferences or distinction among them.
28
(c) If and to the extent that either of the Borrowers shall
fail to make any payment with respect to any of the Obligations as and
when due or to perform any of the Obligations in accordance with the
terms thereof, then in each such event, the other Borrower will make
such payment with respect to, or perform, such Obligation. Each
Borrower further agrees that it shall have no right of subrogation,
indemnity, reimbursement or contribution against the other Borrower for
amounts so paid under this Credit Agreement until such time as the
Lenders have been paid in full and all Commitments under this Credit
Agreement have been terminated.
(d) The obligations of each Borrower under the provisions of
this Section 2.2 constitute full recourse obligations of such Borrower,
enforceable against it to the full extent of its properties and assets.
(e) Except as otherwise expressly provided herein, to the
extent permitted by law, each Borrower hereby waives notice of
acceptance of its joint and several liability and of all extensions of
credit to the Borrowers by the Lenders, notice of occurrence of any
Default or Event of Default (except to the extent notice is expressly
required to be given pursuant to the terms of this Loan Agreement), or
of any presentment or demand for any payment under this Loan Agreement,
notice of any action at any time taken or omitted by the Administrative
Agent or the Lenders under or in respect of any of the obligations
hereunder, any requirement of diligence and, generally, all demands,
notices and other formalities of every kind in connection with this
Loan Agreement and the benefit of any laws that exonerate or limit the
liability of co-borrowers or sureties and any defenses provided by
those laws. Each Borrower hereby assents to, and waives notice of, any
extension or postponement of the time for the payment of any of the
Obligations, the acceptance of any partial payment thereon, any waiver,
consent or other action or acquiescence by the Administrative Agent or
the Lenders at any time or times in respect of any default by either
Borrower in the performance or satisfaction of any term, covenant,
condition or provision of this Loan Agreement, any and all other
indulgences whatsoever by the Administrative Agent or the Lenders in
respect of any of the obligations hereunder, and the taking, addition,
substitution or release, in whole or in part, at any time or times, of
any security for any of such obligations or the addition, substitution
or release, in whole or in part, of either Borrower. Without limiting
the generality of the foregoing, each Borrower assents to any other
action or delay in acting or any failure to act on the part of the
Administrative Agent or the Lenders, including, without limitation, any
failure strictly or diligently to assert any right or to pursue any
remedy or to comply fully with applicable laws or regulations
thereunder which might, but for the provisions of this Section 2.2,
afford grounds for terminating, discharging or relieving such Borrower,
in whole or in part, from any of its obligations under this Section
2.2, it being the intention of each Borrower that, so long as any of
29
the Obligations hereunder remain unsatisfied, the obligations of such
Borrower under this Section 2.2 shall not be discharged except by
performance and then only to the extent of such performance. The
obligations of each Borrower under this Section 2.2 shall not be
diminished or rendered unenforceable by any winding up, reorganization,
arrangement, liquidation, reconstruction or similar proceeding with
respect to either Borrower or a Lender. The joint and several liability
of the Borrowers hereunder shall continue in full force and effect
notwithstanding any absorption, merger, amalgamation or any other
change whatsoever in the name, membership, constitution or place of
formation of either Borrower or any of the Lenders.
(f) The provisions of this Section 2.2 are made for the
benefit of the Lenders and their successors and assigns, and may be
enforced by them from time to time against either of the Borrowers as
often as occasion therefor may arise and without requirement on the
part of the Lenders first to marshal any of its claims or to exercise
any of its rights against the other Borrower or to exhaust any remedies
available to it against the other Borrower or to resort to any other
source or means of obtaining payment of any of the Obligations
hereunder or to elect any other remedy. The provisions of this Section
2.2 shall remain in effect until all the Obligations shall have been
paid in full or otherwise fully satisfied. If at any time, any payment,
or any part thereof, made in respect of any of the Obligations is
rescinded or must otherwise be restored or returned by the Lenders upon
the insolvency, bankruptcy or reorganization of either of the
Borrowers, or otherwise, the provisions of this Section 2.2 will
forthwith be reinstated and in effect as though such payment had not
been made.
(g) Notwithstanding any provision to the contrary contained
herein or in any of the other Loan Documents, to the extent the
obligations of either Borrower shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of
any applicable state or federal law relating to fraudulent conveyances
or transfers) then the obligations of such Borrower hereunder shall be
limited to the maximum amount that is permissible under applicable law
(whether federal or state and including, without limitation, the
Bankruptcy Code).
2.3 APPOINTMENT OF BOP.
BRT hereby appoints BOP to act as its agent for all purposes under this
Loan Agreement (including, without limitation, with respect to all matters
related to the borrowing and repayment of Loans) and agrees that (i) BOP may
execute such documents on behalf of BRT as BOP deems appropriate in its sole
discretion and BRT shall be obligated by all of the terms of any such document
executed on its behalf, (ii) any notice or communication delivered by the
Administrative Agent or the Lenders to BOP shall be deemed delivered to BRT and
(iii) the Administrative Agent or the Lenders may accept, and be permitted to
rely on, any document, instrument or agreement executed by BOP on behalf of BRT.
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2.4 NON-RECOURSE.
Notwithstanding anything herein to the contrary, no recourse shall be
had against any past, present or future shareholder, officer, director or
trustee of BRT for any obligation of the Loan Parties under the Loan Documents,
or for any claim based thereon or otherwise in respect thereof; provided,
however, that this Section 2.4 shall not restrict or limit any claim against any
such Person arising out of or occurring with respect to fraud or any intentional
misrepresentation or any act or omission that is willful or wanton or
constitutes gross negligence or willful misconduct.
SECTION 3.
GENERAL PROVISIONS APPLICABLE TO LOANS
3.1 INTEREST.
(a) Interest Rate. Except as otherwise provided in Section
3.1(b), all Base Rate Loans shall accrue interest at the Adjusted Base
Rate. All Eurodollar Loans shall accrue interest at the Adjusted
Eurodollar Rate.
(b) Default Rate of Interest. Upon the occurrence, and during
the continuance, of an Event of Default, the principal of and, to the
extent permitted by law, interest on the Loans and any other amounts
owing hereunder or under the other Loan Documents (including without
limitation fees and expenses) shall bear interest, payable on demand,
at a per annum rate equal to four percent (4%) plus the rate which
would otherwise be applicable (or if no rate is applicable, then the
rate for Base Rate Loans plus four percent (4%) per annum); provided
that unless the Loans have been accelerated, interest, including the
default rate of interest, shall only be due and payable on the Interest
Payment Dates.
(c) Interest Payments. Interest on Loans shall be due and
payable in arrears on each Interest Payment Date. If an Interest
Payment Date falls on a date which is not a Business Day, such Interest
Payment Date shall be deemed to be the succeeding Business Day, except
that in the case of Eurodollar Loans where the succeeding Business Day
falls in the succeeding calendar month, such Interest Payment Date
shall be the preceding Business Day.
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3.2 PLACE AND MANNER OF PAYMENTS.
All payments of principal, interest, fees, expenses and other amounts
to be made by a Borrower under this Loan Agreement shall be made by such
Borrower unconditionally and without deduction for any counterclaim, defense,
recoupment or setoff and received not later than 2:00 p.m. on the date when due,
in Dollars and in immediately available funds, to the Administrative Agent at
its offices in New York City, New York. Payments received after such time shall
be deemed to have been received on the next Business Day. The Borrowers shall,
at the time they make any payment under this Loan Agreement, specify to the
Administrative Agent the Loans, fees or other amounts payable by the Borrowers
hereunder to which such payment is to be applied (and in the event that they
fail to specify, or if such application would be inconsistent with the terms
hereof, the Administrative Agent shall, subject to Section 3.7, distribute such
payment to the Lenders in such manner as the Administrative Agent may deem
appropriate). The Administrative Agent will distribute any such payment to the
Lenders on the day received if such payment is received prior to 2:00 p.m.;
otherwise the Administrative Agent will distribute such payment to the Lenders
on the next succeeding Business Day. Whenever any payment hereunder shall be
stated to be due on a day which is not a Business Day, the due date thereof
shall be extended to the next succeeding Business Day (subject to accrual of
interest and fees for the period of such extension), except that in the case of
Eurodollar Loans, if the extension would cause the payment to be made in the
next following calendar month, then such payment shall instead be made on the
next preceding Business Day.
3.3 PREPAYMENTS.
(a) Voluntary Prepayments. The Borrowers shall have the right
to prepay the Loans, in whole or in part from time to time without
premium or penalty; provided, however, that (i) Eurodollar Loans may
only be prepaid on three Business Days' prior written notice to the
Administrative Agent and any prepayment of Eurodollar Loans will be
subject to Section 3.14, (ii) (x) in the case of Eurodollar Loans, each
such partial prepayment shall be in the minimum principal amount of
$1,000,000 and integral multiples of $100,000 in excess thereof, or (y)
in the case of Base Rate Loans, each such partial prepayment shall be
in the minimum principal amount of $500,000 and integral multiples of
$100,000 in excess thereof. Amounts pre-paid pursuant to this Section
3.3(a) may not be reborrowed.
(b) Mandatory Prepayments.
(i) If at any time after the Closing Date a Change of
Control shall occur (the date on which such Change of Control
occurs being the "PREPAYMENT DATE"), the Term Loan Commitments
shall terminate and reduce to zero and the Borrowers shall
immediately prepay the Loans on the Prepayment Date as if the
Prepayment Date were the Loan Maturity Date. The Borrowers
shall make such prepayment on the Prepayment Date together
with all accrued interest on the amount prepaid and any unpaid
fees and expenses that are due and owing.
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(ii) If the Borrowers or any Subsidiary receives any
Net Offering Proceeds, the Borrowers shall prepay the Loans in
an amount equal to the amount of such Net Offering Proceeds on
the date such Net Offering Proceeds are received. The
Borrowers shall make such prepayment on the date such Net
Offering Proceeds are received together with all accrued
interest on the amount prepaid and any unpaid fees and
expenses that are due and owing.
Amounts prepaid pursuant to this Section 3.3(b) may not be
reborrowed.
(c) Application of Prepayments. All amounts paid pursuant to
Section 3.3(a) shall be applied as directed by the Borrowers. All
amounts paid pursuant to Section 3.3(a) and 3.3(b), the application of
which has not been directed by the Borrowers, shall be applied first to
Base Rate Loans and then to Eurodollar Loans in direct order of
Interest Period maturities. All prepayments hereunder shall be subject
to Section 3.14; provided that prepayments required to be made pursuant
to Section 3.3(b)(i) that repay a Eurodollar Loan within 30 days of the
last day of its Interest Period shall not be subject to Section 3.14.
3.4 FACILITY FEE; ADMINISTRATIVE FEES. (a) The Borrowers shall pay to
the Administrative Agent, for the pro-rata benefit of each Lender (based on each
Lender's Pro Rata Share) a facility fee (the "FACILITY FEE") equal to the sum
of: (A) 0.15% of the total outstanding principal amount of the Term Loans (if
any) on the date that is 90 days after the Funding Date, which amount shall be
earned and payable on the date that is 90 days after the Funding Date, (B) 0.25%
of the total outstanding principal amount of the Term Loans (if any) on the date
that is 180 days after the Funding Date, which amount shall be earned and
payable on the date that is 180 days after the Funding Date, and (C) 0.25% of
the total outstanding principal amount of the Term Loans (if any) on the date
that is 270 days after the Funding Date, which amount shall be earned and
payable on the date that is 270 days after the Funding Date.
(b) The Borrowers agree to pay to the Administrative Agent,
for its own account, an annual fee as agreed to between the Borrowers
and the Administrative Agent in the Fee Letter.
3.5 PAYMENT IN FULL AT MATURITY. On the Loan Maturity Date, the entire
outstanding principal balance of all Loans, together with accrued but unpaid
interest and all other sums owing with respect thereto, shall be due and payable
in full, unless accelerated sooner pursuant to Section 9.2.
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3.6 COMPUTATIONS OF INTEREST AND FEES.
(a) Except for Base Rate Loans bearing interest based on the
Prime Rate, which shall be calculated on the basis of a 365 or 366 day
year as the case may be, all computations of interest and fees
hereunder shall be made on the basis of the actual number of days
elapsed over a year of 360 days. Interest shall accrue from and include
the date of borrowing (or continuation or conversion) but exclude the
date of payment.
(b) It is the intent of the Lenders and the Borrowers to
conform to and contract in strict compliance with applicable usury law
from time to time in effect. All agreements between the Lenders and the
Borrowers are hereby limited by the provisions of this paragraph which
shall override and control all such agreements, whether now existing or
hereafter arising and whether written or oral. In no way, nor in any
event or contingency (including but not limited to prepayment or
acceleration of the maturity of any obligation), shall the interest
taken, reserved, contracted for, charged, or received under this Loan
Agreement, under the Notes or otherwise, exceed the maximum nonusurious
amount permissible under applicable law. If, from any possible
construction of any of the Loan Documents or any other document,
interest would otherwise be payable in excess of the maximum
nonusurious amount, any such construction shall be subject to the
provisions of this paragraph and such interest shall be automatically
reduced to the maximum nonusurious amount permitted under applicable
law, without the necessity of execution of any amendment or new
document. If any Lender shall ever receive anything of value which is
characterized as interest on the Loans under applicable law and which
would, apart from this provision, be in excess of the maximum lawful
amount, an amount equal to the amount which would have been excessive
interest shall, without penalty, be applied to the reduction of the
principal amount owing on the Loans and not to the payment of interest,
or refunded to the Borrowers or the other payor thereof if and to the
extent such amount which would have been excessive exceeds such unpaid
principal amount of the Loans. The right to demand payment of the Loans
or any other indebtedness evidenced by any of the Loan Documents does
not include the right to receive any interest which has not otherwise
accrued on the date of such demand, and the Lenders do not intend to
charge or receive any unearned interest in the event of such demand.
All interest paid or agreed to be paid to the Lenders with respect to
the Loans shall, to the extent permitted by applicable law, be
amortized, prorated, allocated, and spread throughout the full stated
term (including any renewal or extension) of the Loans so that the
amount of interest on account of such indebtedness does not exceed the
maximum nonusurious amount permitted by applicable law.
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3.7 PRO RATA TREATMENT.
Except to the extent otherwise provided herein, the Loans, each payment
or prepayment of principal of any Loan, each payment of fees (other than
administrative fees payable pursuant to Section 3.4, and each conversion or
continuation of any Loan, shall (except as otherwise provided in Section 3.11)
be allocated pro rata among the Lenders according to each Lender's Pro Rata
Share; provided that, if any Lender shall have failed to pay its applicable Pro
Rata Share of any Loan, then any amount to which such Lender would otherwise be
entitled pursuant to this Section 3.7 shall instead be payable to the
Administrative Agent until the share of such Loan not funded by such Lender has
been repaid; provided further, that in the event any amount paid to any Lender
pursuant to this Section 3.7 is rescinded or must otherwise be returned by the
Administrative Agent, each Lender shall, upon the request of the Administrative
Agent, repay to the Administrative Agent the amount so paid to such Lender, with
interest for the period commencing on the date such payment is returned by the
Administrative Agent until the date the Administrative Agent receives such
repayment at a rate per annum equal to, during the period to but excluding the
date two Business Days after such request, the Federal Funds Rate, and
thereafter, at the Base Rate plus two percent (2%) per annum.
3.8 SHARING OF PAYMENTS.
The Lenders agree among themselves that, except to the extent otherwise
provided herein, in the event that any Lender shall obtain payment in respect of
any Loan or any other obligation owing to such Lender under this Loan Agreement
through the exercise of a right of setoff, banker's lien or counterclaim, or
pursuant to a secured claim under Section 506 of the Bankruptcy Code or other
security or interest arising from, or in lieu of, such secured claim, received
by such Lender under any applicable bankruptcy, insolvency or other similar law
or otherwise, or by any other means (other than in connection with an assignment
pursuant to Section 3.15 or Section 11.3, in excess of its pro rata share of
such payment as provided for in this Loan Agreement, such Lender shall promptly
pay in cash or purchase from the other Lenders a participation in such Loans and
other obligations in such amounts, and make such other adjustments from time to
time, as shall be equitable to the end that all Lenders share such payment in
accordance with their respective ratable shares as provided for in this Loan
Agreement. The Lenders further agree among themselves that if payment to a
Lender obtained by such Lender through the exercise of a right of setoff,
banker's lien, counterclaim or other event as aforesaid shall be rescinded or
must otherwise be restored, each Lender which shall have shared the benefit of
such payment shall, by payment in cash or a repurchase of a participation
theretofore sold, return its share of that benefit (together with its share of
any accrued interest payable with respect thereto) to each Lender whose payment
shall have been rescinded or otherwise restored. The Borrowers agree that any
Lender so purchasing such a participation may, to the fullest extent permitted
by law, exercise all rights of payment, including setoff, banker's lien or
counterclaim, with respect to such participation as fully as if such Lender were
a holder of such Loan or other obligation in the amount of such participation.
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Except as otherwise expressly provided in this Loan Agreement, if any Lender
shall fail to remit to the Administrative Agent or any other Lender an amount
payable by such Lender to the Administrative Agent or such other Lender pursuant
to this Loan Agreement on the date when such amount is due, such payments shall
be made together with interest thereon for each date from the date such amount
is due until the date such amount is paid to the Administrative Agent or such
other Lender at a rate per annum equal to the Federal Funds Rate. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this Section 3.8 applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such secured
claim in a manner consistent with the rights of the Lenders under this Section
3.8 to share in the benefits of any recovery on such secured claim.
3.9 CAPITAL ADEQUACY.
If, after the date hereof, any Lender has determined that the adoption
or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or administration
of, any applicable law, rule or regulation regarding capital adequacy, or
compliance by such Lender, or its parent corporation, with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Lender's (or parent corporation's)
capital or assets as a consequence of its commitments or obligations hereunder
to a level below that which such Lender, or its parent corporation, could have
achieved but for such adoption, effectiveness, change or compliance (taking into
consideration such Lender's (or parent corporation's) policies with respect to
capital adequacy), then, upon notice from such Lender to the Borrowers and the
Administrative Agent, the Borrowers shall be obligated to pay to such Lender
such additional amount or amounts as will compensate such Lender (or parent
corporation) on an after-tax basis (after taking into account applicable
deductions and credits in respect of the amount indemnified) for such reduction.
Each determination by any such Lender of amounts owing under this Section shall,
absent manifest error, be conclusive and binding on the parties hereto. This
covenant shall survive the termination of this Loan Agreement and the payment of
the Loans and all other amounts payable hereunder.
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3.10 INABILITY TO DETERMINE INTEREST RATE.
If prior to the first day of any Interest Period, the Administrative
Agent shall have determined in good faith (which determination shall be
conclusive and binding upon the Borrowers) that, by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist for
ascertaining the Adjusted Eurodollar Rate or the Eurodollar Rate for such
Interest Period, the Administrative Agent shall give telecopy or telephonic
notice thereof to the Borrowers and the Lenders as soon as practicable
thereafter, and will also give prompt written notice to the Borrowers and the
Lenders when such conditions no longer exist. If such notice is given (a) any
Eurodollar Loans requested to be made on the first day of such Interest Period
shall be made as Base Rate Loans and (b) any Loans that were to have been
converted on the first day of such Interest Period to or continued as Eurodollar
Loans shall be converted to or continued as Base Rate Loans. Until such notice
has been withdrawn by the Administrative Agent, no further Eurodollar Loans
shall be made or continued as such, nor shall the Borrowers have the right to
convert Base Rate Loans to Eurodollar Loans.
3.11 ILLEGALITY.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurodollar Loans as contemplated by this Loan Agreement, (a) such
Lender shall promptly give written notice of such circumstances to the Borrowers
and the Administrative Agent (which notice shall be promptly withdrawn whenever
such circumstances no longer exist), (b) the commitment of such Lender hereunder
to make Eurodollar Loans, continue Eurodollar Loans as such and convert a Base
Rate Loan to Eurodollar Loans shall forthwith be cancelled and, until such time
as it shall no longer be unlawful for such Lender to make or maintain Eurodollar
Loans, such Lender shall then have a commitment only to make a Base Rate Loan
when a Eurodollar Loan is requested and (c) such Lender's Loans then outstanding
as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans
on the respective last days of the then current Interest Periods with respect to
such Loans or within such earlier period as required by law. If any such
conversion of a Eurodollar Loan occurs on a day which is not the last day of the
then current Interest Period with respect thereto, the Borrowers shall pay to
such Lender such amounts, if any, as may be required pursuant to Section 3.14;
provided that no such payments shall be required if the conversion of a
Eurodollar Loan occurs within 30 days of the last day of the Interest Period of
such Eurodollar Loan.
3.12 REQUIREMENTS OF LAW.
If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof applicable to any Lender, or compliance by
any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority, in each case made
subsequent to the Closing Date (or, if later, the date on which such Lender
becomes a Lender):
37
(a) shall subject such Lender to any tax of any kind
whatsoever with respect to any Eurodollar Loans made by it or its
obligation to make Eurodollar Loans, or change the basis of taxation of
payments to such Lender in respect thereof (except for Non-Excluded
Taxes covered by Section 3.13 (including Non-Excluded Taxes imposed
solely by reason of any failure of such Lender to comply with its
obligations (if any) under Section 3.13(b)) and changes in taxes
measured by or imposed upon the overall net income, or franchise tax
(imposed in lieu of such net income tax), of such Lender or its
applicable lending office, branch, or any Affiliate thereof);
(b) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Adjusted Eurodollar Rate
hereunder; or
(c) shall impose on such Lender any other condition (excluding
any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Loans or to reduce any amount receivable hereunder in
respect thereof, then, in any such case, upon notice to the Borrowers from such
Lender, through the Administrative Agent, in accordance herewith, the Borrowers
shall be obligated to promptly pay such Lender, upon its demand, any additional
amounts necessary to compensate such Lender on an after-tax basis (after taking
into account applicable deductions and credits in respect of the amount
indemnified) for such increased cost or reduced amount receivable, provided
that, in any such case, the Borrowers may elect to convert the Eurodollar Loans
made by such Lender hereunder to Base Rate Loans by giving the Administrative
Agent at least one Business Day's notice of such election, in which case the
Borrowers shall promptly pay to such Lender, upon demand, without duplication,
such amounts, if any, as may be required pursuant to Section 3.14. If any Lender
becomes entitled to claim any additional amounts pursuant to this Section 3.12,
it shall provide prompt notice thereof to the Borrowers, through the
Administrative Agent, certifying (x) that one of the events described in this
Section 3.12 has occurred and describing in reasonable detail the nature of such
event, (y) as to the increased cost or reduced amount resulting from such event
and (z) as to the additional amount demanded by such Lender and a reasonably
detailed explanation of the calculation thereof. Such a certificate as to any
additional amounts payable pursuant to this Section 3.12 submitted by such
Lender, through the Administrative Agent, to the Borrowers shall be conclusive
and binding on the parties hereto in the absence of manifest error. This
covenant shall survive the termination of this Loan Agreement and the payment of
the Loans and all other amounts payable hereunder.
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3.13 TAXES.
(a) Except as provided below in this Section 3.13, all
payments made by the Borrowers under this Loan Agreement and any Notes
shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other
taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any court, or governmental body, agency or other official,
excluding taxes measured by or imposed upon the overall net income of
any Lender or its applicable lending office, or any branch or Affiliate
thereof, and all franchise taxes, branch taxes, taxes on doing business
or taxes on the overall capital or net worth of any Lender or its
applicable lending office, or any branch or Affiliate thereof, in each
case imposed in lieu of net income taxes: (i) by the jurisdiction under
the laws of which such Lender, applicable lending office, branch or
Affiliate is organized or is located, or in which its principal
executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii)
by reason of any connection between the jurisdiction imposing such tax
and such Lender, applicable lending office, branch or Affiliate other
than a connection arising solely from such Lender having executed,
delivered or performed its obligations, or received payment under or
enforced, this Loan Agreement or any Notes. If any such non-excluded
taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("NON-EXCLUDED TAXES") are required to be withheld from
any amounts payable to the Administrative Agent or any Lender hereunder
or under any Notes, (A) the amounts so payable to the Administrative
Agent or such Lender shall be increased to the extent necessary to
yield to the Administrative Agent or such Lender (after payment of all
Non-Excluded Taxes) interest on any such other amounts payable
hereunder at the rates or in the amounts specified in this Loan
Agreement and any Notes, provided, however, that the Borrowers shall be
entitled to deduct and withhold any Non-Excluded Taxes and shall not be
required to increase any such amounts payable to any Lender that is not
organized under the laws of the United States of America or a state
thereof if such Lender fails to comply with the requirements of
paragraph (b) of this Section 3.13 whenever any Non-Excluded Taxes are
payable by the Borrowers, and (B) as promptly as possible after request
therefor the Borrowers shall send to the Administrative Agent for its
own account or for the account of such Lender, as the case may be, a
certified copy of an original official receipt received by the
Borrowers showing payment thereof. If the Borrowers fail to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or fail
to remit to the Administrative Agent the required receipts or other
required documentary evidence, the Borrowers shall indemnify the
Administrative Agent and any Lender for any incremental taxes, interest
or penalties that may become payable by the Administrative Agent or any
Lender as a result of any such failure. The agreements in this
subsection shall survive the termination of this Loan Agreement and the
payment of the Loans and all other amounts payable hereunder.
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(b) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof shall:
(i) (A) on or before the date of any payment by the
Borrowers under this Loan Agreement or Notes to such Lender,
deliver to the Borrowers and the Administrative Agent (x) two
duly completed copies of United States Internal Revenue
Service Form W8-BEN or W8-ECI, or successor applicable form,
as the case may be, certifying that it is entitled to receive
payments under this Loan Agreement and any Notes without
deduction or withholding of any United States federal income
taxes and (y) an Internal Revenue Service Form W-8 or W-9, or
successor applicable form, as the case may be, certifying that
it is entitled to an exemption from United States backup
withholding tax;
(B) deliver to the Borrowers and the
Administrative Agent two further copies of any such
form or certification on or before the date that any
such form or certification expires or becomes
obsolete and after the occurrence of any event
requiring a change in the most recent form previously
delivered by it to the Borrowers; and
(C) obtain such extensions of time for filing and
complete such forms or certifications as may
reasonably be requested by the Borrowers or the
Administrative Agent; or
(ii) in the case of any such Lender that is not a
"bank" within the meaning of Section 881(c)(3)(A) of the
Internal Revenue Code, such Lender shall (A) represent to the
Borrowers (for the benefit of the Borrowers and the
Administrative Agent) that it is not a bank within the meaning
of Section 881(c)(3)(A) of the Internal Revenue Code, (B)
furnish to the Borrowers, on or before the date of any payment
by the Borrowers, with a copy to the Administrative Agent, two
accurate and complete original signed copies of Internal
Revenue Service Form W-8, or successor applicable form
certifying to such Lender's legal entitlement at the date of
such certificate to an exemption from U.S. withholding tax
under the provisions of Section 881(c) of the Internal Revenue
Code with respect to payments to be made under this Loan
Agreement and any Notes (and to deliver to the Borrowers and
the Administrative Agent two further copies of such form on or
before the date it expires or becomes obsolete and after the
occurrence of any event requiring a change in the most
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recently provided form and, if necessary, obtain any
extensions of time reasonably requested by the Borrowers or
the Administrative Agent for filing and completing such
forms), and (C) agree, to the extent legally entitled to do
so, upon reasonable request by the Borrowers, to provide to
the Borrowers (for the benefit of the Borrowers and the
Administrative Agent) such other forms as may be reasonably
required in order to establish the legal entitlement of such
Lender to an exemption from withholding with respect to
payments under this Loan Agreement and any Notes.
Notwithstanding the above, if any change in treaty, law or regulation
has occurred after the date such Person becomes a Lender hereunder
which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form with respect
to it and such Lender so advises the Borrowers and the Administrative
Agent then such Lender shall be exempt from such requirements. Each
Person that shall become a Lender or a participant of a Lender pursuant
to Section 11.3 shall, upon the effectiveness of the related transfer,
and if applicable, be required to provide all of the forms,
certifications and statements required pursuant to this subsection (b);
provided that in the case of a participant of a Lender, the obligations
of such participant of a Lender pursuant to this subsection (b) shall
be determined as if such participant of a Lender were a Lender except
that such participant of a Lender shall furnish all such required
forms, certifications and statements to the Lender from which the
related participation shall have been purchased.
3.14 COMPENSATION.
Except as expressly set forth in Section 3.3(c), the Borrowers promise
to indemnify each Lender and to hold each Lender harmless from any loss or
expense which such Lender may sustain or incur as a consequence of (a) default
by the Borrowers in making a borrowing of, conversion into or continuation of
Eurodollar Loans after the Borrowers have given a notice requesting the same in
accordance with the provisions of this Loan Agreement, (b) default by the
Borrowers in making any prepayment of a Eurodollar Loan after the Borrowers have
given a notice thereof in accordance with the provisions of this Loan Agreement
and (c) any continuation, conversion, payment or prepayment of Eurodollar Loans
on a day which is not the last day of an Interest Period with respect thereto.
Such indemnification shall be calculated by the Administrative Agent and shall
include, without limitation, an amount equal to (i) the amount of interest which
would have accrued on the amount so prepaid, or not so borrowed, converted or
continued, for the period from the date of such prepayment or of such failure to
borrow, convert or continue to the last day of the applicable Interest Period
(or, in the case of a failure to borrow, convert or continue, the Interest
Period that would have commenced on the date of such failure) in each case at
the applicable rate of interest for such Eurodollar Loans provided for herein
minus (ii) the amount of interest which would have accrued to such Lender on
41
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank Eurodollar market. The agreements in this Section
3.14 shall survive the termination of this Loan Agreement and the payment of the
Loans and all other amounts payable hereunder. Notwithstanding the foregoing,
any prepayment of a Eurodollar Loan made hereunder (as a result of a mandatory
requirement of this Loan Agreement) within thirty (30) days of the end of the
Interest Period with respect to such Eurodollar Loan, shall not be subject to
this Section 3.14.
3.15 MITIGATION; MANDATORY ASSIGNMENT.
Each Lender shall use reasonable efforts to avoid or mitigate any
increased cost or suspension of the availability of an interest rate under
Sections 3.9 through 3.14 inclusive to the greatest extent practicable
(including transferring the Loans to another lending office or one of its
Affiliates) unless, in the opinion of such Lender, such efforts would be likely
to have an adverse effect upon it. In the event a Lender makes a request to the
Borrowers for additional payments in accordance with Sections 3.9, 3.10, 3.11,
3.12, 3.13 or 3.14 or a Lender becomes a Defaulting Lender, then, provided that
no Default or Event of Default has occurred and is continuing at such time, the
Borrowers may, at their own expense (such expense to include any transfer fee
payable to the Administrative Agent under Section 11.3(b) and any expense
pursuant to Section 3.14), and in their sole discretion, require such Lender to
transfer and assign in whole (but not in part), without recourse (in accordance
with and subject to the terms and conditions of Section 11.3(b)), all of its
interests, rights and obligations under this Loan Agreement to an Eligible
Assignee which shall assume such assigned obligations (which Eligible Assignee
may be another Lender, if a Lender accepts such assignment); provided that (a)
such assignment shall not conflict with any law, rule or regulation or order of
any court or other governmental authority and (b) the Borrowers or such assignee
shall have paid to the assigning Lender in immediately available funds the
principal of and interest accrued to the date of such payment on the portion of
the Loans hereunder held by such assigning Lender and all other amounts owed to
such assigning Lender hereunder, including amounts owed pursuant to Sections 3.9
through 3.14. Notwithstanding such assignment, and without limiting any other
provision of this Loan Agreement, such assigning Lender shall continue to
benefit from the provisions of Sections 3.9, 3.12, 3.13 and 11.5 with respect to
the period before the effectiveness of such assignment.
SECTION 4.
[RESERVED]
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SECTION 5.
CONDITIONS PRECEDENT
5.1 CLOSING CONDITIONS.
The effectiveness of this Loan Agreement and the obligation of the
Lenders to make the Loans is subject to satisfaction of the following
conditions:
(a) Executed Loan Documents. Receipt by the Administrative
Agent of duly executed copies of: (i) this Loan Agreement; (ii) the
Notes; (iii) the Notice of Borrowing; and (iv) all other Loan Documents
required to be delivered on or before the Funding Date, each in form
and substance reasonably acceptable to the Administrative Agent in its
sole discretion.
(b) Partnership Documents. With respect to each Loan Party
that is a partnership, receipt by the Administrative Agent of the
following:
(i) Partnership Agreements. Certified copies of the
partnership agreement of such Loan Party, together with all
amendments thereto.
(ii) Certificates of Good Standing or Existence. A
certificate of good standing or existence for such Loan Party
issued as of a recent date by its state of organization and
each other state where the failure to qualify or be in good
standing could have a Material Adverse Effect.
(c) Corporate Documents. With respect to each Loan Party that
is a corporation, receipt by the Administrative Agent of the following:
(i) Charter Documents. Copies of the articles or
certificates of incorporation or other charter documents of
such Loan Party certified to be true and complete as of a
recent date by the appropriate Governmental Authority of the
state or other jurisdiction of its incorporation and certified
by a secretary or assistant secretary of such Loan Party to be
true and correct as of the Closing Date.
(ii) Bylaws. A copy of the bylaws of such Loan Party
certified by a secretary or assistant secretary of such Loan
Party to be true and correct as of the Closing Date.
(iii) Good Standing. Copies of certificates of good
standing, existence or their equivalent with respect to such
Loan Party certified as of a recent date by the appropriate
Governmental Authority of the state or other jurisdiction of
incorporation and each other jurisdiction in which the failure
to so qualify and be in good standing could have a Material
Adverse Effect.
43
(d) Limited Liability Company Documents. With respect to each
Loan Party that is a limited liability company, receipt by the
Administrative Agent of the following:
(i) Certificate of Formation. A copy of the
certificate of formation of such Loan Party certified to be
true and complete by the appropriate Governmental Authority of
the state or jurisdiction of its formation and certified by
the sole or managing member of such Loan Party to be true and
correct as of the Closing Date.
(ii) Operating Agreement. A copy of the Operating
Agreement of such Loan Party certified by the sole or managing
member of such Loan Party to be true and correct as of the
Closing Date.
(iii) Good Standing. Copies of certificates of good
standing, existence or their equivalent with respect to such
Loan Party certified as of a recent date by the appropriate
Governmental Authority of the state or other jurisdiction of
formation and each other jurisdiction in which the failure to
so qualify and be in good standing could have a Material
Adverse Effect.
(e) Trust Documents. With respect to BRT, receipt by the
Administrative Agent of the following:
(i) Declaration of Trust. A copy of the Declaration
of Trust of BRT certified to be true and complete by the
appropriate Governmental Authority of the state or
jurisdiction of its formation and certified by the secretary
of BRT to be true and correct as of the Closing Date.
(ii) Bylaws. A copy of the Bylaws of BRT certified by
the trustee of BRT to be true and complete as of the Closing
Date.
(iii) Resolutions. Copies of the resolutions of the
Board of Trustees of BRT approving and adopting the Loan
Documents to which it and each Loan Party is a party, the
transactions contemplated therein and authorizing execution
and delivery thereof by and on behalf of itself and each Loan
Party.
(iv) Good Standing. Copies of certificates of good
standing, existence or their equivalent with respect to BRT
certified as of a recent date by the appropriate Governmental
Authorities of the state or other jurisdiction of formation
and each other jurisdiction in which the failure to so qualify
and be in good standing could have a Material Adverse Effect.
44
(v) Incumbency. An incumbency certificate with
respect to each of the Loan Parties, certified by a secretary
or assistant secretary of BRT to be true and correct as of the
Closing Date.
5.2 FUNDING CONDITIONS.
The obligation of the Lenders to make the Loans on the Funding Date is
further subject to satisfaction of the following conditions:
(a) Opinion of Counsel. Receipt by the Administrative Agent of
opinions (which shall cover, among other things, authority, legality,
validity, binding effect and enforceability), satisfactory to the
Administrative Agent, addressed to the Administrative Agent and the
Lenders and dated as of the Funding Date, from legal counsel to the
Loan Parties.
(b) Material Adverse Effect. There shall not have occurred a
change since December 31, 2004 that has had or could reasonably be
expected to have a Material Adverse Effect.
(c) Litigation. There shall not exist any pending or
threatened action, suit, investigation or proceeding in any court or
before any arbitrator or Governmental Authority against a Loan Party or
any of its Subsidiaries that would have or would reasonably be expected
to have a Material Adverse Effect.
(d) Officer's Certificate. The Administrative Agent shall have
received a certificate of the Borrowers on behalf of the Loan Parties
as of the Funding Date stating that (i) the Loan Parties and each of
their Subsidiaries are in compliance with all existing material
financial obligations, (ii) no action, suit, investigation or
proceeding is pending or threatened in any court or before any
arbitrator or Governmental Authority that purports to affect a Loan
Party or any transaction contemplated by the Loan Documents, if such
action, suit, investigation or proceeding could have or could be
reasonably expected to have a Material Adverse Effect, (iii) the
financial statements and information included in the Borrowers' Form
10-K report for the year ended December 31, 2004 and the Form 10-Q
Report for the quarter ended September 30, 2005 were prepared in good
faith and using reasonable assumptions and (iv) immediately after
giving effect to this Loan Agreement, the other Loan Documents and all
the transactions contemplated herein and therein to occur on such date,
(A) each of the Loan Parties is Solvent, (B) no Default or Event of
Default exists, (C) all representations and warranties contained herein
and in the other Loan Documents are true and correct in all material
respects, and (D) the Borrowers and their Subsidiaries are in
compliance as of the Funding Date on a pro forma basis (after giving
effect to the Acquisition) with each of the financial covenants set
forth in Section 7.2.
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(e) Fees and Expenses. Payment by the Borrowers of all fees
and expenses owed by them to the Lenders and the Administrative Agent,
including, without limitation, payment to the Administrative Agent of
the fees set forth herein and in the Fee Letter.
(f) Consents and Approvals. All governmental, shareholder,
partner, member and third-party consents and approvals necessary or, in
the opinion of the Administrative Agent, desirable in connection with
the Loans and the transactions contemplated under the Loan Documents
shall have been duly obtained and shall be in full force and effect,
and a copy of each such consent or approval shall have been delivered
to the Administrative Agent.
(g) Acquisition. Receipt by the Administrative Agent of
evidence of the closing of the Acquisition and a certificate from BRT
stating that (i) there have been no amendments, waivers or other
modifications to the Acquisition Purchase Agreement (except as
consented to by the Administrative Agent), (ii) all conditions
precedent to the effectiveness of the Acquisition under the Acquisition
Purchase Agreement have been satisfied (or waived with the consent of
the Administrative Agent) and (iii) no Company Material Adverse Effect
shall have occurred under (and as defined in) the Acquisition Purchase
Agreement (other than a Company Material Adverse Effect that has been
waived with the consent of the Administrative Agent).
(h) No Legal Impediments. No law, regulation, order, judgment
or decree of any Governmental Authority shall, and the Administrative
Agent shall not have received any notice that litigation is pending or
threatened which is likely to (i) enjoin, prohibit or restrain the
making of the Term Loans on the Funding Date or (ii) impose or result
in the imposition of a Material Adverse Effect.
(i) Delivery of Notice. The Borrowers shall have delivered a
Notice of Borrowing, duly executed and completed, by the time specified
in Section 2.1(b).
(j) Representations and Warranties. The representations and
warranties made by the Combined Parties in any Loan Document shall be
true and correct in all material respects at and as if made as of such
date except to the extent they expressly and exclusively relate to an
earlier date.
(k) No Default. No Default or Event of Default shall exist or
be continuing either prior to or after giving effect thereto.
46
(l) Release of Guarantors for Other Debt. Receipt by the
Administrative Agent of officer's certificates and opinions or other
satisfactory evidence of the release of all guaranties provided by the
Subsidiaries of the Borrowers pursuant to the Indenture and the Private
Placement Notes prior to or substantially concurrent with the Funding
Date.
(m) Other. Receipt by the Lenders of such other documents,
instruments, agreements or information as reasonably and timely
requested by any Lender, including, but not limited to, information
regarding litigation, tax, accounting, labor, insurance, pension
liabilities (actual or contingent), real estate leases, material
contracts, debt agreements, property ownership and contingent
liabilities of the Borrowers and their Subsidiaries.
SECTION 6.
REPRESENTATIONS AND WARRANTIES
Each of the Borrowers hereby represents to the Administrative Agent and
each Lender that:
6.1 FINANCIAL CONDITION.
The financial statements described in Section 5.2(d) and those
delivered to the Lenders pursuant to Section 7.1(a) and (b): (a) have been
prepared in accordance with GAAP (subject, in the case of quarterly financial
statements, to changes resulting from audit and normal year-end audit
adjustments) and (b) present fairly the consolidated financial condition,
results of operations and cash flows of the Borrowers and their Subsidiaries as
of such date and for such periods. Since December 31, 2004, there has been no
sale, transfer or other disposition by any Borrower or any of its Subsidiaries
of any material part of the business or property of the Borrowers and their
Subsidiaries, taken as a whole, and no purchase or other acquisition by any of
them of any business or property (including any capital stock or other equity
interests of any other Person) material in relation to the consolidated
financial condition of the Borrowers and their Subsidiaries (other than the
Acquisition), taken as a whole, in each case, which, is not (i) reflected in the
most recent financial statements described in Section 5.2(d) or delivered to the
Lenders pursuant to Section 7.1 or in the notes thereto or (ii) otherwise
permitted by the terms of this Loan Agreement.
6.2 NO MATERIAL CHANGE.
Since December 31, 2004, there has been no development or event
relating to or affecting a Combined Party which has had or would be reasonably
expected to have a Material Adverse Effect.
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6.3 ORGANIZATION AND GOOD STANDING.
Each Borrower and each Material Subsidiary (a) is either a partnership,
a corporation, a limited liability company or a REIT duly organized or formed,
validly existing and in good standing under the laws of the state (or other
jurisdiction) of its organization or formation, (b) is duly qualified and in
good standing as a foreign partnership, a foreign corporation, a foreign limited
liability company or a foreign REIT and authorized to do business in every other
jurisdiction where the failure to be so qualified, in good standing or
authorized would have or would reasonably be expected to have a Material Adverse
Effect and (c) has the power and authority to own its properties and to carry on
its business as now conducted and as proposed to be conducted.
6.4 DUE AUTHORIZATION.
Each Loan Party (a) has the power and authority to execute, deliver and
perform this Loan Agreement and the other Loan Documents to which it is a party
and to incur the obligations herein and therein provided for and to consummate
the transactions contemplated herein and therein and (b) is duly authorized, and
has been authorized by all necessary action, to execute, deliver and perform
this Loan Agreement and the other Loan Documents to which it is a party and to
consummate the transactions contemplated herein and therein.
6.5 NO CONFLICTS.
Neither the execution and delivery of the Loan Documents, nor the
consummation of the transactions contemplated herein and therein, nor the
performance of or compliance with the terms and provisions hereof and thereof by
a Loan Party will (a) violate or conflict with any provision of its or its
Material Subsidiaries' organizational or governing documents, (b) violate,
contravene or materially conflict with any Requirement of Law or any other law,
regulation (including, without limitation, Regulation U or Regulation X), order,
writ, judgment, injunction, decree or permit applicable to it or its Material
Subsidiaries, (c) violate, contravene or conflict with contractual provisions
of, or cause an event of default under, any indenture, loan agreement, mortgage,
deed of trust, contract or other agreement or instrument to which it or any of
its Material Subsidiaries is a party or by which it or its Material Subsidiaries
may be bound, the violation of which would have or would be reasonably expected
to have a Material Adverse Effect, or (d) result in or require the creation of
any Lien upon or with respect to its or its Material Subsidiaries' properties.
6.6 CONSENTS.
Except for consents, approvals, authorizations and orders that have
been obtained, and filings, registrations and qualifications that have been
made, no consent, approval, authorization or order of, or filing, registration
or qualification with, any court or Governmental Authority or third party in
respect of any Loan Party is required in connection with the execution, delivery
or performance of this Loan Agreement or any of the other Loan Documents by such
Loan Party or the consummation of the transactions contemplated herein and
therein.
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6.7 ENFORCEABLE OBLIGATIONS.
This Loan Agreement and the other Loan Documents to which it is a party
have been duly executed and delivered and constitute legal, valid and binding
obligations of each Loan Party enforceable against such Loan Party in accordance
with their respective terms, except as may be limited by bankruptcy or
insolvency laws or similar laws affecting creditors' rights generally or by
general equitable principles.
6.8 NO DEFAULT.
No Combined Party is in default in any respect under any contract,
lease, loan agreement, indenture, mortgage, security agreement or other
agreement or obligation to which it is a party or by which any of its properties
is bound which default would have or would be reasonably expected to have a
Material Adverse Effect. No Default or Event of Default has occurred or exists
except as previously disclosed in writing to the Lenders.
6.9 OWNERSHIP.
Each Borrower and each of its Subsidiaries is the owner or
ground-lessee of, and has good and marketable fee or leasehold title to, all of
its respective assets and none of such assets is subject to any Lien other than
Permitted Liens.
6.10 INDEBTEDNESS.
The Borrowers and their Subsidiaries have no Indebtedness except as
otherwise permitted by this Loan Agreement.
6.11 LITIGATION.
There are no actions, suits or legal, equitable, arbitration or
administrative proceedings or investigations, pending or, to the knowledge of
any Borrower, threatened, against a Combined Party which would have or would be
reasonably expected to have a Material Adverse Effect.
6.12 TAXES.
Each Borrower, and each of its Subsidiaries, has filed, or caused to be
filed, all tax returns (federal, state, local and foreign) required to be filed
and has paid (a) all amounts of taxes shown thereon to be due (including
interest and penalties) and (b) all other taxes, fees, assessments and other
governmental charges (including mortgage recording taxes, documentary stamp
taxes and intangibles taxes) owing by it, except for such taxes (i) which are
not yet delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. No Borrower is aware of any material proposed tax
assessments against it or any of its Subsidiaries.
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6.13 COMPLIANCE WITH LAW.
Each Combined Party is in compliance with all Requirements of Law and
all other laws, rules, regulations, orders and decrees (including without
limitation Environmental Laws) applicable to it, or to its properties, unless
such failure to comply would not have or would not be reasonably expected to
have a Material Adverse Effect. No Requirement of Law would be reasonably
expected to cause a Material Adverse Effect.
6.14 COMPLIANCE WITH ERISA.
Except as would not result in or be reasonably expected to result in a
Material Adverse Effect:
(a) During the five-year period prior to the date on which
this representation is made or deemed made: (i) no ERISA Event has
occurred, and, to the best of each Borrower's, each Subsidiary of a
Borrower's and each ERISA Affiliate's knowledge, no event or condition
has occurred or exists as a result of which any ERISA Event could
reasonably be expected to occur, with respect to any Plan; (ii) no
"accumulated funding deficiency," as such term is defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, has
occurred with respect to any Plan; (iii) each Plan has been maintained,
operated, and funded in compliance with its own terms and in material
compliance with the provisions of ERISA, the Code, and any other
applicable federal or state laws; and (iv) no Lien in favor or the PBGC
or a Plan has arisen or is reasonably likely to arise on account of any
Plan.
(b) The actuarial present value of all "benefit liabilities"
(as defined in Section 4001(a)(16) of ERISA), whether or not vested,
under each Single Employer Plan, as of the last annual valuation date
prior to the date on which this representation is made or deemed made
(determined, in each case, in accordance with Financial Accounting
Standards Board Statement 87, utilizing the actuarial assumptions used
in such Plan's most recent actuarial valuation report), did not exceed
as of such valuation date the fair market value of the assets of such
Plan.
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(c) No Borrower, Subsidiary of a Borrower or ERISA Affiliate
has incurred, or, to the best of each such party's knowledge, is
reasonably expected to incur, any withdrawal liability under ERISA to
any Multiemployer Plan or Multiple Employer Plan. No Borrower,
Subsidiary of a Borrower or ERISA Affiliate would become subject to any
withdrawal liability under ERISA if any such party were to withdraw
completely from all Multiemployer Plans and Multiple Employer Plans as
of the valuation date most closely preceding the date on which this
representation is made or deemed made. No Borrower, Subsidiary of a
Borrower or ERISA Affiliate has received any notification that any
Multiemployer Plan is in reorganization (within the meaning of Section
4241 of ERISA), is insolvent (within the meaning of Section 4245 of
ERISA), or has been terminated (within the meaning of Title IV of
ERISA), and no Multiemployer Plan is, to the best of each such party's
knowledge, reasonably expected to be in reorganization, insolvent, or
terminated.
(d) No prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected
or may subject any Borrower, any Subsidiary of a Borrower or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l)
of ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which any Borrower, any Subsidiary of a Borrower
or any ERISA Affiliate has agreed or is required to indemnify any
person against any such liability.
(e) No Borrower, Subsidiary of a Borrower or ERISA Affiliate
has material liability with respect to "expected post-retirement
benefit obligations" within the meaning of the Financial Accounting
Standards Board Statement 106. Each Plan which is a welfare plan (as
defined in Section 3(1) of ERISA) to which Sections 601-609 of ERISA
and Section 4980B of the Code apply has been administered in compliance
in all material respects with such sections.
6.15 ORGANIZATION STRUCTURE/SUBSIDIARIES.
As of the Funding Date (after giving effect to the Acquisition), (a)
Schedule 6.15 is a complete and accurate organization chart of the Combined
Parties, and (b) no Borrower has any Subsidiaries or owns an interest, directly
or indirectly, in any joint venture, except as set forth on Schedule 6.15. The
outstanding equity interest of all Subsidiaries of the Borrowers are validly
issued, fully paid and non-assessable and are owned by the Borrowers free and
clear of all Liens. Schedule 6.15 shall be updated as of the end of each fiscal
quarter as set forth in Section 7.1(c). Each owner of an Unencumbered Property,
Unencumbered Construction-in-Process or Unencumbered Eligible Land is either a
Loan Party or an Eligible Subsidiary.
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6.16 USE OF PROCEEDS; MARGIN STOCK.
The proceeds of the Loans will be used solely for the purposes
specified in Section 7.10. None of the proceeds of the Loans will be used in a
manner that would violate Regulation U, Regulation X, or Regulation T. No
proceeds of the Loans will be used for the acquisition of another Person unless
the board of directors (or other comparable governing body) or stockholders (or
other equity owners), as appropriate, of such Person has approved such
acquisition.
6.17 GOVERNMENT REGULATION.
No Borrower, nor any of its Subsidiaries, is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Investment Company Act of 1940 or the Interstate Commerce Act, each as amended.
No director, executive officer or principal shareholder of a Borrower or any of
its Subsidiaries is a director, executive officer or principal shareholder of
any Lender. For the purposes hereof the terms "director," "executive officer"
and "principal shareholder" (when used with reference to any Lender) have the
respective meanings assigned thereto in Regulation O.
6.18 ENVIRONMENTAL MATTERS.
(a) Except as would not have or be reasonably expected to have
a Material Adverse Effect:
(i) Each of the Properties and all operations at the
Properties are in material compliance with all applicable
Environmental Laws, and there is no violation of any
Environmental Law with respect to the Properties or the
businesses operated by a Borrower or any of its Subsidiaries
(the "Businesses"), and there are no conditions relating to
the Businesses or Properties that would be reasonably expected
to give rise to liability under any applicable Environmental
Laws.
(ii) No Borrower, nor any of its Subsidiaries, has
received any written notice of, or inquiry from any
Governmental Authority regarding, any violation, alleged
violation, non-compliance, liability or potential liability
regarding Hazardous Materials or compliance with Environmental
Laws with regard to any of the Properties or the Businesses,
nor does any Borrower or any of its Subsidiaries have
knowledge that any such notice is being threatened.
(iii) Hazardous Materials have not been transported
or disposed of from the Properties, or generated, treated,
stored or disposed of at, on or under any of the Properties or
any other location, in each case by, or on behalf or with the
permission of, any Borrower or any of its Subsidiaries in a
manner that would reasonably be expected to give rise to
liability under any applicable Environmental Law.
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(iv) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of any
Borrower or any of its Subsidiaries, threatened, under any
Environmental Law to which any Borrower or any of its
Subsidiaries is or will be named as a party, nor are there any
consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental
Law with respect to any Borrower or any of its Subsidiaries,
the Properties or the Businesses, in any amount reportable
under the federal Comprehensive Environmental Response,
Compensation and Liability Act or any analogous state law,
except releases in compliance with all Environmental Laws.
(v) There has been no release or threat of release of
Hazardous Materials at or from the Properties, or arising from
or related to the operations (including, without limitation,
disposal) of a Borrower or any of its Subsidiaries in
connection with the Properties or otherwise in connection with
the Businesses except in compliance with Environmental Laws.
(vi) None of the Properties contains, or to the best
knowledge of the Borrowers and their Subsidiaries has
previously contained, any Hazardous Materials at, on or under
the Properties in amounts or concentrations that, if released,
constitute or constituted a violation of, or could give rise
to liability under, Environmental Laws.
(vii) No Borrower, nor any of its Subsidiaries, has
assumed any liability of any Person (other than a Borrower)
under any Environmental Law.
(b) Each Borrower, and each of its Subsidiaries, has adopted
procedures that are designed to (i) ensure that each such party, any of
its operations and each of the properties owned or leased by such party
remains in compliance with applicable Environmental Laws and (ii)
minimize any liabilities or potential liabilities that each such party,
any of its operations and each of the properties owned or leased by
each such party may have under applicable Environmental Laws.
6.19 SOLVENCY.
Each Loan Party, is and, after consummation of the transactions
contemplated by this Loan Agreement, will be Solvent.
6.20 INVESTMENTS.
All Investments of the Borrowers and their Subsidiaries are Permitted
Investments.
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6.21 LOCATION OF PROPERTIES.
As of the Funding Date (after giving effect to the Acquisition), set
forth on Schedule 6.21 is (a) a list of all Properties (with street address,
county and state where located) and the owner of such Property and (b) a list of
all Unencumbered Properties. Schedule 6.21 shall be updated as of the end of
each fiscal quarter as set forth in Section 7.1(c).
6.22 DISCLOSURE.
Neither this Loan Agreement nor any financial statements delivered to
the Lenders nor any other document, certificate or statement furnished to the
Lenders by or on behalf of any Borrower or its Subsidiaries in connection with
the transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading in light of the circumstances in
which made; provided, however, that the Borrowers make no representation or
warranty regarding the information delivered pursuant to Section 7.1(i).
6.23 LICENSES, ETC.
The Combined Parties have obtained, and hold in full force and effect,
all franchises, licenses, permits, certificates, authorizations, qualifications,
accreditations, easements, rights of way and other rights, consents and
approvals which are necessary for the operation of their respective businesses
as presently conducted, except where the failure to obtain the same would not
have or would not reasonably be expected to have a Material Adverse Effect.
6.24 NO BURDENSOME RESTRICTIONS.
No Combined Party is a party to any agreement or instrument or subject
to any other obligation or any charter or corporate restriction or any provision
of any applicable law, rule or regulation which, individually or in the
aggregate, would have or would be reasonably expected to have a Material Adverse
Effect.
6.25 ELIGIBLE SUBSIDIARIES.
Each Subsidiary of the Borrowers which owns or ground-leases any
Property that is treated as Unencumbered Property, Unencumbered
Construction-in-Process or Unencumbered Eligible Land under this Agreement is
either an Eligible Subsidiary or a Guarantor. Schedule 6.25 sets forth a list of
all Eligible Subsidiaries which own or ground-lease any Property that is treated
as Unencumbered Property, Unencumbered Construction-in-Process or Unencumbered
Eligible Land under this Agreement as of the Funding Date (after giving effect
to the Acquisition). Schedule 6.25 shall be updated as of the end of each fiscal
quarter as set forth in Section 7.1(c).
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6.26 FOREIGN ASSETS CONTROL REGULATIONS, ETC.
None of the requesting or borrowing of the Loans or the use of the
proceeds of any thereof will violate the Trading With the Enemy Act (50 U.S.C.
ss. 1 et seq., as amended) (the "TRADING WITH THE ENEMY ACT") or any of the
foreign assets control regulations of the United States Treasury Department (31
CFR, Subtitle B, Chapter V, as amended) (the "FOREIGN ASSETS CONTROL
REGULATIONS") or any enabling legislation or executive order relating thereto
(which for the avoidance of doubt shall include, but shall not be limited to
Executive Order 13224 of September 21, 2001 Blocking Property and Prohibiting
Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism
(66 Fed. Reg. 49079 (2001)) (the "EXECUTIVE ORDER"). Furthermore, neither a
Borrower nor any of their Subsidiaries or other Affiliates (a) is or will become
a "blocked person" as described in the Executive Order, the Trading With the
Enemy Act or the Foreign Assets Control Regulations or (b) engages or will
engage in any dealings or transactions, or be otherwise associated, with any
such "blocked person".
SECTION 7.
AFFIRMATIVE COVENANTS
Each Borrower hereby covenants and agrees that so long as this Loan
Agreement is in effect and until the Obligations have been paid in full:
7.1 INFORMATION COVENANTS.
The Borrowers will furnish, or cause to be furnished, to the
Administrative Agent and, except as otherwise set forth in this Section, each of
the Lenders:
(a) Annual Financial Statements. As soon as available, and in
any event within 90 days after the close of each fiscal year of the
Borrowers, a consolidated balance sheet and income statement of the
Borrowers and their Subsidiaries as of the end of such fiscal year,
together with related consolidated statements of operations and
retained earnings and of cash flows for such fiscal year, setting forth
in comparative form consolidated figures as of the end of and for the
preceding fiscal year, all such financial information described above
to be in reasonable form and detail and audited by independent
certified public accountants of recognized national standing reasonably
acceptable to the Administrative Agent and whose opinion shall be to
the effect that such financial statements have been prepared in
accordance with GAAP (except for changes with which such accountants
concur) and shall not be limited as to the scope of the audit or
qualified in any manner.
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(b) Quarterly Financial Statements. As soon as available, and
in any event within 45 days after the close of each fiscal quarter of
the Borrowers (other than the fourth fiscal quarter), a consolidated
balance sheet and income statement of the Borrowers and their
Subsidiaries, as of the end of such fiscal quarter, together with
related consolidated statements of operations and retained earnings and
of cash flows for such fiscal quarter in each case setting forth in
comparative form consolidated figures for (A) the corresponding quarter
end and quarterly period of the preceding fiscal year and (B)
management's proposed budget for such period, all such financial
information described above to be in reasonable form and detail and
reasonably acceptable to the Administrative Agent, and accompanied by a
certificate of the chief financial officer of BOP to the effect that
such quarterly financial statements fairly present in all material
respects the financial condition and results of operations of the
Borrowers and their Subsidiaries and have been prepared in accordance
with GAAP, subject to changes resulting from audit and normal year-end
audit adjustments. The information required pursuant to this subsection
(b) shall be delivered in both electronic and printed form.
(c) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 7.1(a) and 7.1(b), a
certificate of the chief financial officer or chief executive officer
of BRT, substantially in the form of Exhibit 7.1(c), (i) demonstrating
compliance with the financial covenants contained in Section 7.2 by
calculation thereof as of the end of each such fiscal period, including
such detail and supporting documentation as reasonably requested by the
Administrative Agent (and in the case of Section 7.2(d) and Section
7.2(e), indicating the number of fiscal quarters for which such ratio
has exceeded 0.60 to 1.0), (ii) stating that no Default or Event of
Default exists, or if any Default or Event of Default does exist,
specifying the nature and extent thereof and what action the Borrowers
propose to take with respect thereto, (iii) providing information
regarding (A) Investments in a manner to demonstrate compliance with
Section 8.6 and (B) dividends and redemption of shares in a manner to
demonstrate compliance with Section 8.7 and (iv) updating Schedule
6.15, Schedule 6.21 and Schedule 6.25 as appropriate. Such certificate
shall be delivered in both electronic and printed form.
(d) Accountant's Certificate. Within the period for delivery
of the annual financial statements provided in Section 7.1(a), a
certificate of the accountants conducting the annual audit stating that
they have reviewed this Loan Agreement and stating further whether, in
the course of their audit, they have become aware of any Default or
Event of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof.
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(e) Annual Information and Projections. Within 30 days after
the end of each fiscal year of the Borrowers, all such financial
information regarding the Borrowers and their Subsidiaries and
specifically regarding the Properties, as the Administrative Agent
shall reasonably request, including, but not limited to, partnership,
limited liability company and joint venture agreements, property cash
flow projections, property budgets, actual and budgeted Capital
Expenditures, operating statements (current year and immediately
preceding year, if the Property existed as a Property in the
immediately preceding year), mortgage information, rent rolls, lease
expiration reports, leasing status reports, notes payable summary,
bullet notes summary, equity funding requirements, contingent liability
summary, lines of credit summary, lines of credit collateral summary,
wrap notes and notes receivable summary, schedule of outstanding
letters of credit, summary of cash and Cash Equivalents, projection of
management and leasing fees and overhead budgets.
(f) Auditor's Reports. Promptly upon receipt thereof, a copy
of any "management letter" submitted by independent accountants to any
Borrower or any of its Subsidiaries in connection with any annual,
interim or special audit of the books of such Borrower or any of its
Subsidiaries.
(g) Reports. Promptly, (i) and in any case within five (5)
days of receipt or transmission thereof, copies of any filings and
registrations with, and reports to or from, the Securities and Exchange
Commission, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports as any Borrower or
any of its Subsidiaries shall send to its shareholders, members or
partners generally, (ii) and in any case within ten (10) days of filing
thereof, copies of all income tax returns filed by a Borrower and (iii)
upon the written request of the Administrative Agent, all reports and
written information to and from the United States Environmental
Protection Agency, or any state or local agency responsible for
environmental matters, the United States Occupational Health and Safety
Administration, or any state or local agency responsible for health and
safety matters, or any successor agencies or authorities concerning
environmental, health or safety matters; provided, however, that if any
such transmissions are done electronically, the Borrowers shall instead
promptly notify the Administrative Agent of same and provide
information on how to retrieve such information.
(h) Notices. Upon a Borrower obtaining knowledge thereof, such
Borrower will give written notice to the Administrative Agent (which
shall promptly forward such notice to the Lenders) immediately of (i)
the occurrence of an event or condition consisting of a Default or
Event of Default, specifying the nature and existence thereof and what
action the Borrowers propose to take with respect thereto, (ii) the
occurrence of any of the following with respect to any Borrower or any
of its Subsidiaries: (A) the pendency or commencement of any litigation
or arbitral or governmental proceeding against any Borrower or any of
its Subsidiaries which if adversely determined would have or would be
reasonably expected to have a Material Adverse Effect, or (B) the
institution of any proceedings against any Borrower or any of its
Subsidiaries with respect to, or the receipt of notice by such Person
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of potential liability or responsibility for, violation, or alleged
violation, of any federal, state or local law, rule or regulation,
including, but not limited to, Environmental Laws, the violation of
which would have or would be reasonably expected to have a Material
Adverse Effect, and (iii) the occurrence of any enforcement or notice
to enforce a completion guaranty and within five Business Days
thereafter provide evidence that the remaining costs to complete the
applicable project are covered by a construction loan and/or surety
bond.
(i) ERISA. Upon a Borrower or any ERISA Affiliate obtaining
knowledge thereof, the Borrowers will give written notice to the
Administrative Agent promptly (and in any event within five Business
Days) of: (i) any event or condition, including, but not limited to,
any Reportable Event, that constitutes, or might reasonably lead to, an
ERISA Event; (ii) with respect to any Multiemployer Plan, the receipt
of notice as prescribed in ERISA or otherwise of any withdrawal
liability assessed against a Borrower, any Subsidiary of a Borrower or
any ERISA Affiliate, or of a determination that any Multiemployer Plan
is in reorganization or insolvent (both within the meaning of Title IV
of ERISA); (iii) the failure to make full payment on or before the due
date (including extensions) thereof of all amounts which a Borrower,
any Subsidiary of a Borrower or any ERISA Affiliate is required to
contribute to each Plan pursuant to its terms as required to meet the
minimum funding standard set forth in ERISA and the Code with respect
thereto; or (iv) any change in the funding status of any Plan that
could have a Material Adverse Effect; in each case together, with a
description of any such event or condition or a copy of any such notice
and a statement by the chief financial officer of the Borrowers briefly
setting forth the details regarding such event, condition, or notice,
and the action, if any, which has been or is being taken or is proposed
to be taken by such Borrower, Subsidiary or ERISA Affiliate with
respect thereto. Promptly upon request, the Borrowers shall furnish the
Administrative Agent and the Lenders with such additional information
concerning any Plan as may be reasonably requested, including, but not
limited to, copies of each annual report/return (Form 5500 series), as
well as all schedules and attachments thereto required to filed with
the Department of Labor and/or the Internal Revenue Service pursuant to
ERISA and the Code, respectively, for each "plan year" (within the
meaning of Section 3(39) of ERISA).
(j) Environmental.
(i) Subsequent to a notice from any Governmental
Authority that would reasonably cause concern or during the
existence of an Event of Default, and upon the written request
of the Administrative Agent, the Borrowers will furnish or
cause to be furnished to the Administrative Agent, at the
Borrowers' expense, an updated report of an environmental
assessment of reasonable scope, form and depth, including,
where appropriate, invasive soil or groundwater sampling, by a
consultant reasonably acceptable to the Administrative Agent
as to the nature and extent of the presence of any Hazardous
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Materials on any Property and as to the compliance by the
Borrowers with Environmental Laws. If the Borrowers fail to
deliver such an environmental report within seventy-five (75)
days after receipt of such written request then the
Administrative Agent may arrange for same, and the Borrowers
hereby grant to the Administrative Agent and its
representatives access to the Properties and a license of a
scope reasonably necessary to undertake such an assessment
(including, where appropriate, invasive soil or groundwater
sampling). The reasonable cost of any assessment arranged for
by the Administrative Agent pursuant to this provision will be
payable by the Borrowers on demand and added to the
Obligations.
(ii) Each of the Borrowers and their Subsidiaries
will conduct and complete all investigations, studies,
sampling, and testing and all remedial, removal, and other
actions necessary to address all Hazardous Materials on, from,
or affecting any Property to the extent necessary to be in
compliance with all Environmental Laws and all other
applicable federal, state, and local laws, regulations, rules
and policies and with the orders and directives of all
Governmental Authorities exercising jurisdiction over such
Property to the extent any failure would have or would be
reasonably expected to have a Material Adverse Effect.
(k) Other Information. With reasonable promptness upon any
such request, such other information regarding the Properties or
regarding the business, assets or financial condition of the Borrowers
and their Subsidiaries as the Administrative Agent or any Lender may
reasonably request.
7.2 FINANCIAL COVENANTS.
(a) Interest Coverage Ratio. The Interest Coverage Ratio, as
of the end of each fiscal quarter of the Combined Parties for the
twelve month period ending on such date, shall be greater than or equal
to 2.0 to 1.0.
(b) Fixed Charge Coverage Ratio. The Fixed Charge Coverage
Ratio, as of the end of each fiscal quarter of the Combined Parties for
the twelve month period ending on such date, shall be greater than or
equal to 1.5 to 1.0.
(c) Net Worth. At the end of each fiscal quarter of the
Combined Parties, Net Worth shall be greater than or equal to the sum
of (i) $1,163,119,000 plus (ii) 70% of the Net Worth of Prentiss on the
date of the Acquisition plus (iii) 75% of the Equity Net Cash Proceeds
from all Equity Issuances after the Closing Date (other than Equity
Issuances referred to in the following subclause (iv)) plus (iv) 75% of
the actual increase in Net Worth (if any) resulting from an Equity
Issuance after the Closing Date made in connection with an Incentive
Stock Plan.
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(d) Leverage Ratio. The Leverage Ratio, as of the end of each
fiscal quarter of the Combined Parties, shall be less than or equal to
(i) 0.60 to 1.0; provided that such ratio may exceed 0.60 to 1.0 as of
the end of up to four (4) fiscal quarters of the Combined Parties
during the term of this Agreement (whether or not consecutive) so long
as such ratio does not exceed 0.65 to 1.0.
(e) Unsecured Debt Limitation. At the end of each fiscal
quarter of the Combined Parties, the ratio of Unsecured Debt to
Unencumbered Value shall be less than or equal to 0.60 to 1.0; provided
that such ratio may exceed 0.60 to 1.0 as of the end of up to four (4)
fiscal quarters of the Combined Parties during the term of this
Agreement (whether or not consecutive) so long as such ratio does not
exceed 0.65 to 1.0.
(f) Secured Debt Ratio. The Secured Debt Ratio, as of the end
of each fiscal quarter of the Combined Parties, shall be less than or
equal to 0.40 to 1.0.
(g) Unencumbered Cash Flow Ratio. The Unencumbered Cash Flow
Ratio, as of the end of each fiscal quarter of the Combined Parties,
shall be greater than or equal to 2.00 to 1.0.
7.3 PRESERVATION OF EXISTENCE.
Each of the Borrowers will do all things necessary to preserve and keep
in full force and effect its existence, rights, franchises and authority and the
existence, rights, franchises and authority of the Material Subsidiaries, except
as permitted by Section 8.4. Without limiting the generality of the foregoing,
BRT will do all things necessary to maintain its status as a REIT.
7.4 BOOKS AND RECORDS.
Each of the Borrowers will, and will cause its Subsidiaries to, keep
complete and accurate books and records of its transactions in accordance with
good accounting practices on the basis of GAAP (including the establishment and
maintenance of appropriate reserves).
7.5 COMPLIANCE WITH LAW.
Each of the Borrowers will, and will cause its Subsidiaries to, comply
in all material respects with all material laws, rules, regulations and orders,
and all applicable material restrictions imposed by all Governmental
Authorities, applicable to it and its property (including, without limitation,
Environmental Laws and ERISA).
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7.6 PAYMENT OF TAXES AND OTHER INDEBTEDNESS.
Each of the Borrowers will, and will cause its Subsidiaries to, pay,
settle or discharge (a) all taxes, assessments and governmental charges or
levies imposed upon it, or upon its income or profits, or upon any of its
properties, before they shall become delinquent, (b) all lawful claims
(including claims for labor, materials and supplies) which, if unpaid, might
give rise to a Lien upon any of its properties, and (c) except as prohibited
hereunder, all of its other Indebtedness as it shall become due; provided,
however, that a Borrower or any of its Subsidiaries shall not be required to pay
any such tax, assessment, charge, levy, claim or Indebtedness which is being
contested in good faith by appropriate proceedings and as to which adequate
reserves therefor have been established in accordance with GAAP, unless the
failure to make any such payment (i) would give rise to an immediate right to
foreclose on a Lien on an Unencumbered Property securing such amounts (unless no
Default or Event of Default would exist after giving effect to the disposition
of such Unencumbered Property) or (ii) would have a Material Adverse Effect.
7.7 INSURANCE.
Each of the Borrowers will, and will cause its Subsidiaries to, at all
times maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance, casualty insurance and business
interruption insurance) in such amounts, covering such risks and liabilities and
with such deductibles or self-insurance retentions as are in accordance with
normal industry practice.
7.8 MAINTENANCE OF ASSETS.
Each of the Borrowers will, and will cause its Subsidiaries to,
maintain and preserve its Properties and all other assets in good repair,
working order and condition, normal wear and tear excepted, and will make, or
cause to be made, in the Properties and other assets, from time to time, all
repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto as may be needed or proper, to the extent and in the manner
customary for companies in similar businesses.
7.9 PERFORMANCE OF OBLIGATIONS.
Each of the Borrowers will, and will cause its Subsidiaries to, perform
in all material respects all of its obligations under the terms of all material
agreements, indentures, mortgages, security agreements or other debt instruments
to which it is a party or by which it is bound.
7.10 USE OF PROCEEDS.
The Borrowers will use the proceeds of the Loans solely to pay a
portion of the consideration owing from BRT or its Subsidiaries in connection
with the Acquisition, to repay existing indebtedness of Prentiss, and to pay
costs and expenses in connection with the Acquisition and the Spin-Out.
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7.11 AUDITS/INSPECTIONS.
Upon reasonable notice and during normal business hours, each Borrower
will, and will cause its Subsidiaries to, permit representatives appointed by
the Administrative Agent, including, without limitation, independent
accountants, agents, attorneys and appraisers to visit and inspect such
Borrower's or other Combined Party's property, including, without limitation,
the Properties, its books and records, its accounts receivable and inventory,
its facilities and its other business assets, and to make photocopies or
photographs thereof and to write down and record any information such
representative obtains and shall permit the Administrative Agent or its
representatives to investigate and verify the accuracy of information provided
to the Lenders, and to discuss all such matters with the officers, employees and
representatives of the Borrowers, their Subsidiaries and any other Combined
Party.
7.12 ADDITIONAL LOAN PARTIES.
At any time a Subsidiary of the Borrowers that is not a Loan Party
becomes the owner (or ground lessee under an Eligible Ground Lease) of Property
that the Borrowers determine to treat as an Unencumbered Property, Unencumbered
Eligible Land or Unencumbered Construction-in-Process and is not an Eligible
Subsidiary, the Borrowers shall notify the Administrative Agent and promptly
thereafter (but in any event within 30 days after such event) such Subsidiary
shall: (a) execute a Guaranty in substantially the form of Exhibit 7.12 and (b)
deliver such other documentation as the Administrative Agent may reasonably
request in connection with the foregoing, including, without limitation,
information regarding the real property owned by such Person, certified
resolutions and other organizational and authorizing documents of such Person
and favorable opinions of counsel to such Person (which shall cover, among other
things, the legality, validity, binding effect and enforceability of the
documentation referred to above), all in form, content and scope reasonably
satisfactory to the Administrative Agent. It is understood and agreed that in
the event any Subsidiary provides a Guaranty hereunder, it may also guaranty
Indebtedness under the Revolving Credit Facility, the Indenture, the Private
Placement Notes and the Interim Facility (if entered into).
7.13 INTEREST RATE PROTECTION AGREEMENTS.
The Borrowers shall maintain Interest Rate Hedges on a notional amount
of the Funded Debt which, when added to the aggregate principal amount of the
Funded Debt which bears interest at a fixed rate, equals or exceeds 60% of the
aggregate principal amount of all Funded Debt (other than Indebtedness under the
Loan Documents and the Interim Facility (if entered into)). "INTEREST RATE
HEDGES" shall mean interest rate exchange, collar, cap, swap, adjustable strike
cap, adjustable strike corridor or similar agreements having terms, conditions
and tenors that are reasonably customary for borrowers such as the Borrowers and
entered into by the Borrowers in order to provide protection to, or minimize the
impact upon, the Borrowers and their Subsidiaries of increasing floating rates
of interest applicable to the Funded Debt.
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7.14 CONSTRUCTION.
With respect to any construction and development engaged in by the
Combined Parties, the Borrowers shall or shall cause another Person to: (a)
comply with all applicable regulations and codes and (b) complete all such
construction and development in accordance with approved plans and
specifications.
7.15 ACQUISITIONS AND SALES.
If a Borrower or one of its Subsidiaries anticipates (a) making an
Investment or an acquisition in excess of $75,000,000 or (b) the sale, lease,
transfer, encumbrance or disposition of a Property (or equity interest therein)
for consideration in excess of $75,000,000, then five (5) Business Days prior to
such Borrower (or Subsidiary) taking such action, the Borrowers shall provide
the Administrative Agent written notice of such action, together with a
certification as to compliance with the terms of this Loan Agreement, including,
without limitation, Section 7.2 (on a Pro Forma Basis), after giving effect to
such action prepared and executed by the chief financial officer or chief
executive officer of BRT; provided, however, that no such notice shall be
required in connection with the Acquisition or the Spin-Out.
SECTION 8.
NEGATIVE COVENANTS
Each Borrower hereby covenants and agrees that so long as this Loan
Agreement is in effect and until the Obligations have been paid in full:
8.1 INDEBTEDNESS.
No Borrower will, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Loan Agreement and the
other Loan Documents;
(b) Indebtedness in respect of current accounts payable and
accrued expenses incurred in the ordinary course of business; and
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(c) Other Indebtedness as long as, prior to and after giving
effect thereto, the Borrowers are otherwise in compliance with the
terms of this Loan Agreement;
provided that the Borrowers shall not permit any Subsidiary of a
Borrower that is the owner (or ground-lessee) of a Property that is treated as
an Unencumbered Property, an Unencumbered Construction-in-Process or
Unencumbered Eligible Land under this Agreement to contract, create, incur,
assume or permit to exist any Recourse Indebtedness, unless such Subsidiary
becomes a Guarantor hereunder as required pursuant to Section 7.12.
8.2 LIENS.
No Borrower will, nor will it permit any of its Material Subsidiaries
to, contract, create, incur, assume or permit to exist any Lien with respect to
any of its Properties or any other assets of any kind (whether real or personal,
tangible or intangible), whether now owned or after acquired, except for
Permitted Liens.
8.3 NATURE OF BUSINESS.
No Borrower will, nor will it permit any of its Subsidiaries to, alter
the character of its business from that conducted as of the Closing Date or
engage in any business other than the business conducted as of the Closing Date.
8.4 CONSOLIDATION AND MERGER.
No Borrower will, nor will it permit any of its Material Subsidiaries
to, enter into any transaction of merger or consolidation or liquidate, wind up
or dissolve itself (or suffer any liquidation or dissolution); provided that
notwithstanding the foregoing provisions of this Section 8.4, (a) (i) any Person
may merge into a Borrower in a transaction in which such Borrower is the
surviving Person; (ii) any Person may merge into any Material Subsidiary in a
transaction in which the surviving entity is a Material Subsidiary; and (iii)
any Material Subsidiary may sell, transfer, lease or otherwise dispose of its
assets to a Borrower or to another Material Subsidiary; provided that in each
case the Borrowers execute and deliver such documents, instruments and
certificates as the Administrative Agent may reasonably request and after giving
effect thereto no Default or Event of Default exists; (b) upon prior written
notification to the Administrative Agent, any Material Subsidiary of a Borrower
may be dissolved or liquidated so long as (1) after giving effect thereto no
Default or Event of Default exists, (2) any transfer of assets in connection
therewith to a Person that is not a Material Subsidiary shall be subject to
Section 7.15, if applicable, and (3) the Borrowers shall execute and deliver
such documents, instruments and certificates as the Administrative Agent may
reasonably request; (c) upon prior written notification to the Administrative
Agent, as long as no Default or Event of Default exists, a Material Subsidiary
of a Borrower that has no assets and no revenues may be dissolved or liquidated
and (d) the Acquisition shall be permitted.
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8.5 SALE OR LEASE OF ASSETS.
(a) No Property may be conveyed, sold, leased, transferred or
otherwise disposed of unless the Borrowers comply with Section 7.15 (if
applicable) and after giving effect thereto no Default or Event of
Default exists.
(b) No equity interest in any Guarantor or Eligible
Unencumbered Property Subsidiary may be conveyed, sold, transferred or
otherwise disposed of unless the Borrowers comply with Section 7.15 (if
applicable) and after giving effect thereto no Default or Event of
Default exists. Upon the disposition of an equity interest in a
Guarantor in conformance with the terms hereof, if after the
disposition of such equity interest such Guarantor no longer qualifies
as the owner of any Unencumbered Properties the Lenders agree to
release such Guarantor from its obligations hereunder, and the Lenders
hereby consent to the Administrative Agent executing and delivering
such releases as necessary to give effect to such agreement.
8.6 ADVANCES, INVESTMENTS AND LOANS.
Neither the Borrowers nor any of their Subsidiaries will make any
Investments except for Permitted Investments.
8.7 RESTRICTED PAYMENTS.
BOP will not, directly or indirectly, declare or pay any dividends or
make any other distribution upon any of its shares of beneficial interests or
any shares of its capital stock of any class or with respect to any of its
membership or partnership interests; provided that BOP may pay dividends or make
distributions in an amount not to exceed, in the aggregate, the greater of (i)
90% of Funds From Operations earned subsequent to September 30, 2005 or (ii) the
minimum amount necessary for BRT to maintain its status as a REIT.
8.8 TRANSACTIONS WITH AFFILIATES.
No Borrower will, nor will it permit any of its Subsidiaries to, enter
into any transaction or series of transactions, whether or not in the ordinary
course of business, with any officer, director, trustee, shareholder, Subsidiary
or Affiliate other than on terms and conditions substantially as favorable as
would be obtainable in a comparable arm's-length transaction with a Person other
than an officer, director, trustee, shareholder, Subsidiary or Affiliate.
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8.9 FISCAL YEAR; ORGANIZATIONAL DOCUMENTS.
No Borrower will, nor will it permit any of its Subsidiaries to, (a)
change its fiscal year or (b) change its articles or certificate of
incorporation, its bylaws, its declaration of trust, its limited liability
company agreement, its articles or certificate of partnership or partnership
agreement or any other organization or formation documents in any manner that
would have an adverse effect of the rights of the Lenders under the Loan
Documents; provided that (i) BRT may take such action, with prior written notice
to the Administrative Agent, as is necessary to maintain its status as a REIT
and (ii) the Borrowers will provide prompt written notice to the Administrative
Agent of any change to be made in compliance with the terms of this Section 8.9.
8.10 LIMITATIONS.
No Borrower will, nor will it permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause, incur, assume, suffer or
permit to exist or become effective any consensual encumbrance or restriction of
any kind on the ability of any such Person to pay any Indebtedness owed to the
Borrowers; provided that a Subsidiary of a Borrower (which is not itself a Loan
Party) that obtains financing may agree with the provider of such financing to
restrict repayments of Indebtedness owing to the Borrowers.
8.11 OTHER NEGATIVE PLEDGES.
The Borrowers will not, and will not permit any of their Material
Subsidiaries to, enter into, assume or become subject to any agreement
prohibiting or otherwise restricting the creation or assumption of any Lien upon
its properties or assets, whether now owned or hereafter acquired, or requiring
the grant of any security for such obligation if security is given for some
other obligation, other than (i) as provided under the Loan Documents, Revolving
Credit Facility and the Interim Facility (if entered into), (ii) restrictions on
Secured Indebtedness and Unsecured Indebtedness set forth in the Indenture and
the Private Placement Notes, (iii) an agreement by a Borrower or one of its
Subsidiaries with a joint venture partner not to pledge its equity interest in
such joint venture and (iv) an agreement by a Borrower or one of its
Subsidiaries in a mortgage or joint venture agreement to restrict Liens on a
particular property which is not an Unencumbered Property or on the equity
interests in any particular entity which is not a Borrower or a Material
Subsidiary.
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SECTION 9.
EVENTS OF DEFAULT
9.1 EVENTS OF DEFAULT.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. The Borrowers shall default in the payment (i)
when due of any principal amount of any Loans or (ii) within three days
of when due of any interest on the Loans or any fees or other amounts
owing hereunder, under any of the other Loan Documents or in connection
herewith.
(b) Representations. Any representation, warranty or statement
made or deemed to be made by a Borrower or any of its Subsidiaries
herein, in any of the other Loan Documents, or in any statement or
certificate delivered or required to be delivered pursuant hereto or
thereto shall prove untrue in any material respect on the date as of
which it was made or deemed to have been made or delivered.
(c) Covenants. Any Borrower or any of its Subsidiaries shall:
(i) default in the due performance or observance of
any term, covenant or agreement contained in Sections 7.2,
7.3, 7.10, 7.11, 7.12, 7.14 or 8.1 through 8.11 inclusive; or
(ii) default in the due performance or observance by
it of any term, covenant or agreement contained in Section 7.1
and such default shall continue unremedied for a period of
five Business Days after the earlier of a Borrower becoming
aware of such default or notice thereof given by the
Administrative Agent; or
(iii) default in the due performance or observance by
it of any term, covenant or agreement (other than those
referred to in subsections (a), (b) or (c)(i) or (ii) of this
Section 9.1) contained in this Loan Agreement and such default
shall continue unremedied for a period of at least 30 days
after the earlier of a Borrower becoming aware of such default
or notice thereof given by the Administrative Agent.
(d) Other Loan Documents. (i) Any Borrower or any of its
Subsidiaries shall default in the due performance or observance of any
term, covenant or agreement in any of the other Loan Documents and such
default shall continue unremedied for a period of at least 30 days
after the earlier of a Borrower becoming aware of such default or
notice thereof given by the Administrative Agent or (ii) any Loan
Document (or any provision of any Loan Document) shall fail to be in
full force and effect or any Borrower or any of its Subsidiaries shall
so assert or any Loan Document shall fail to give the Administrative
Agent and/or the Lenders the security interests, liens, rights, powers
and privileges purported to be created thereby.
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(e) Bankruptcy, etc. The occurrence of any of the following
with respect to any Borrower or any of its Significant Subsidiaries:
(i) a court or Governmental Authority having jurisdiction in the
premises shall enter a decree or order for relief in respect of any
Borrower or any of its Significant Subsidiaries in an involuntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or appoint a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of any Borrower or
any of its Significant Subsidiaries or for any substantial part of its
property or ordering the winding up or liquidation of its affairs; or
(ii) an involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect is commenced against any
Borrower or any of its Significant Subsidiaries and such petition
remains unstayed and in effect for a period of 60 consecutive days; or
(iii) any Borrower or any of its Significant Subsidiaries shall
commence a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or consent to the
entry of an order for relief in an involuntary case under any such law,
or consent to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official of such Person or any substantial part of its property or make
any general assignment for the benefit of creditors; or (iv) any
Borrower or any of its Significant Subsidiaries shall be generally
unable or shall admit in writing its inability to pay its debts
generally as they become due or any action shall be taken by such
Person in furtherance of any of the aforesaid purposes.
(f) Defaults under Other Agreements. With respect to any
Recourse Indebtedness (other than Indebtedness outstanding under this
Loan Agreement) of any Borrower or any of its Subsidiaries in an
aggregate principal amount equal to or in excess of $25,000,000, (i) a
Borrower or one of its Subsidiaries shall (A) default in any payment
(beyond the applicable grace period with respect thereto, if any) with
respect to any such Recourse Indebtedness, or (B) default (after giving
effect to any applicable grace period) in the observance or performance
of any term, covenant or agreement relating to such Recourse
Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event or condition shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or permit, the holder or holders of such
Recourse Indebtedness (or a trustee or agent on behalf of such holders)
to cause (determined without regard to whether any notice or lapse of
time is required) any such Recourse Indebtedness to become due prior to
its stated maturity; or (ii) any such Recourse Indebtedness shall be
declared due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment prior to the stated maturity
thereof; or (iii) any such Indebtedness shall mature and remain unpaid.
With respect to any Non-Recourse Indebtedness of any Borrower or any of
its Subsidiaries in an aggregate principal amount in excess of
$75,000,000, a default in payment (whether by acceleration or
otherwise) shall occur and such payment default is not cured or waived
within ninety (90) days after the occurrence thereof.
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(g) Judgments. One or more judgments, orders, or decrees shall
be entered against any one or more of any Borrower or any of its
Subsidiaries involving a liability of $25,000,000 or more, in the
aggregate (to the extent not paid or covered by insurance provided by a
carrier who has acknowledged coverage), and such judgments, orders or
decrees (i) are the subject of any enforcement proceeding commenced by
any creditor or (ii) shall continue unsatisfied, undischarged and
unstayed for a period ending on the first to occur of (A) the last day
on which such judgment, order or decree becomes final and unappealable
or (B) 20 days.
(h) ERISA Events. The occurrence of any of the following
events or conditions, unless such event or occurrence would not have or
be reasonably expected to have a Material Adverse Effect: (1) any
"accumulated funding deficiency," as such term is defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, shall
exist with respect to any Plan, or any lien shall arise on the assets
of a Borrower, any Subsidiary of a Borrower or any ERISA Affiliate in
favor of the PBGC or a Plan; (2) an ERISA Event shall occur with
respect to a Single Employer Plan, which is, in the reasonable opinion
of the Administrative Agent, likely to result in the termination of
such Plan for purposes of Title IV of ERISA; (3) an ERISA Event shall
occur with respect to a Multiemployer Plan or Multiple Employer Plan,
which is, in the reasonable opinion of the Administrative Agent, likely
to result in (i) the termination of such Plan for purposes of Title IV
of ERISA, or (ii) a Borrower, any Subsidiary of a Borrower or any ERISA
Affiliate incurring any liability in connection with a withdrawal from,
reorganization of (within the meaning of Section 4241 of ERISA), or
insolvency (within the meaning of Section 4245 of ERISA) of such Plan;
or (4) any prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility shall occur which may subject a Borrower, any Subsidiary
of a Borrower or any ERISA Affiliate to any liability under Sections
406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or
under any agreement or other instrument pursuant to which a Borrower,
any Subsidiary of a Borrower or any ERISA Affiliate has agreed or is
required to indemnify any person against any such liability.
(i) REIT Status. BRT does not maintain its REIT status or is
no longer deemed to be a REIT.
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9.2 ACCELERATION; REMEDIES.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived in writing by the
Required Lenders (or the Lenders as may be required hereunder), the
Administrative Agent shall, upon the request and direction of the Required
Lenders, by written notice to the Borrowers, take any of the following actions
without prejudice to the rights of the Administrative Agent or any Lender to
enforce its claims against the Borrowers, except as otherwise specifically
provided for herein:
(a) Termination of Term Loan Commitments. Declare the Term
Loan Commitments terminated whereupon the Term Loan Commitments shall
be immediately terminated.
(b) Acceleration of Loans. Declare the unpaid principal of and
any accrued interest in respect of all Loans and any and all other
indebtedness or obligations of any and every kind owing by a Borrower
to any of the Lenders hereunder to be due whereupon the same shall be
immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by the
Borrowers.
(c) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Loan Documents, including,
without limitation, all rights and remedies against a Guarantor and all
rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in
Section 9.1(e) shall occur, then the Term Loan Commitments shall automatically
terminate and all Loans, all accrued interest in respect thereof, all accrued
and unpaid fees and all other indebtedness or obligations owing to the Lenders
hereunder shall immediately become due and payable without the giving of any
notice or other action by the Administrative Agent or the Lenders, which notice
or other action is expressly waived by the Borrowers.
Notwithstanding the fact that enforcement powers reside primarily with
the Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.
9.3 ALLOCATION OF PAYMENTS AFTER EVENT OF DEFAULT.
Notwithstanding any other provisions of this Loan Agreement, after the
occurrence and during the continuance of an Event of Default, all amounts
collected or received by the Administrative Agent or any Lender on account of
amounts outstanding under any of the Loan Documents shall be paid over or
delivered as follows:
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FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Administrative Agent in connection with enforcing the rights of
the Lenders under the Loan Documents;
SECOND, to payment of any fees owed to the Administrative
Agent;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses (including, without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its rights
under the Loan Documents;
FOURTH, to the payment of all accrued fees and interest
payable to the Lenders hereunder;
FIFTH, to the payment of the outstanding principal amount of
the Loans;
SIXTH, to all other Obligations which shall have become due
and payable under the Loan Documents and not repaid pursuant to clauses
"FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; and (b) each of the Lenders shall receive an amount equal
to its pro rata share (based on the proportion that the then outstanding Loans
held by such Lender bears to the aggregate then outstanding Loans) of amounts
available to be applied pursuant to clauses "THIRD", "FOURTH," "FIFTH," and
"SIXTH" above.
SECTION 10.
AGENCY PROVISIONS
10.1 APPOINTMENT.
Each Lender hereby designates and appoints JPMorgan Chase Bank, N.A. as
Administrative Agent of such Lender to act as specified herein and in the other
Loan Documents, and each Lender hereby authorizes the Administrative Agent, as
the agent for such Lender, to take such action on its behalf under the
provisions of this Loan Agreement and the other Loan Documents and to exercise
such powers and perform such duties as are expressly delegated by the terms
hereof and of the other Loan Documents, together with such other powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
elsewhere herein and in the other Loan Documents, the Administrative Agent shall
not have any duties or responsibilities, except those expressly set forth herein
and therein, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities shall
be read into this Loan Agreement or any of the other Loan Documents, or shall
otherwise exist against the Administrative Agent. The provisions of this Section
are solely for the benefit of the Administrative Agent and the Lenders and none
of the Borrowers or their Subsidiaries shall have any rights as a third party
beneficiary of the provisions hereof. In performing its functions and duties
under this Loan Agreement and the other Loan Documents, the Administrative Agent
shall act solely as an agent of the Lenders and does not assume and shall not be
deemed to have assumed any obligation or relationship of agency or trust with or
for any Borrowers or their Subsidiaries.
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10.2 DELEGATION OF DUTIES.
The Administrative Agent may execute any of its duties hereunder or
under the other Loan Documents by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.
10.3 EXCULPATORY PROVISIONS.
No Agent-Related Person shall be (a) liable for any action lawfully
taken or omitted to be taken by it under or in connection herewith or in
connection with any of the other Loan Documents (except for such Person's own
gross negligence or willful misconduct) or (b) responsible in any manner to any
of the Lenders for any recitals, statements, representations or warranties made
by any of the Borrowers or their Subsidiaries contained herein or in any of the
other Loan Documents or in any certificate, report, document, financial
statement or other written or oral statement referred to or provided for in, or
received by an Agent-Related Person under or in connection herewith or in
connection with the other Loan Documents, or the enforceability or sufficiency
of this Loan Agreement or any of the other Loan Documents, or for any failure of
the Borrowers or their Subsidiaries to perform their obligations hereunder or
thereunder. No Agent-Related Person shall be responsible to any Lender for the
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of this Loan Agreement, or any of the other Loan Documents or for
any representations, warranties, recitals or statements made herein or therein
or made by the Borrowers or their Subsidiaries in any written or oral statement
or in any financial or other statements, instruments, reports, certificates or
any other documents in connection herewith or therewith furnished or made by an
Agent-Related Person to the Lenders or by or on behalf of the Borrowers or their
Subsidiaries to an Agent-Related Person or any Lender or be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained herein or therein or
as to the use of the proceeds of the Loans or of the existence or possible
existence of any Default or Event of Default or to inspect the properties, books
or records of the Borrowers or their Subsidiaries. No Agent-Related Person is a
trustee for the Lenders or owes any fiduciary duty to the Lenders.
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10.4 RELIANCE ON COMMUNICATIONS.
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to any of the Borrowers or their Subsidiaries, independent
accountants and other experts selected by the Administrative Agent with
reasonable care). The Administrative Agent may deem and treat each Lender as the
owner of its interests hereunder for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with the
Administrative Agent in accordance with Section 11.3(b). The Administrative
Agent shall be fully justified in failing or refusing to take any action under
this Loan Agreement or under any of the other Loan Documents unless it shall
first receive such advice or concurrence of the Required Lenders (or, to the
extent provided in Section 11.6, all of the Lenders) as it deems appropriate or
it shall first be indemnified to its satisfaction by the Lenders against any and
all liability and expense (other than any liability or expense resulting from
the gross negligence or willful misconduct of the Administrative Agent) which
may be incurred by it by reason of taking or continuing to take any such action.
The Agent-Related Persons shall in all cases be fully protected in acting, or in
refraining from acting, hereunder or under any of the other Loan Documents in
accordance with a request of the Required Lenders (or to the extent specifically
provided in Section 11.6, all the Lenders) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders
(including their successors and assigns).
10.5 NOTICE OF DEFAULT.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or a Borrower referring
to the applicable Loan Document, describing such Default or Event of Default and
stating that such notice is a "notice of default." In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall give
prompt notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders (or, to the extent provided in Section 11.6,
all of the Lenders).
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10.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.
Each Lender expressly acknowledges that no Agent-Related Person has
made any representations or warranties to it and that no act by any
Agent-Related Person hereafter taken, including any review of the affairs of any
Borrower or its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person or any other Lender. Each Lender
represents to the Administrative Agent and the Arranger that it has,
independently and without reliance upon any Agent-Related Person or any other
Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business,
assets, operations, property, financial and other conditions, prospects and
creditworthiness of the Borrowers and their Subsidiaries and made its own
decision to make its Loans hereunder and enter into this Loan Agreement. Each
Lender also represents that it will, independently and without reliance upon any
Agent-Related Person or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Loan Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, assets, operations, property, financial and
other conditions, prospects and creditworthiness of the Borrowers and their
Subsidiaries. Except for notices, reports and other documents expressly required
to be furnished to the Lenders by the Administrative Agent hereunder, no
Agent-Related Person shall have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, operations,
assets, property, financial or other conditions, prospects or creditworthiness
of the Borrowers and their Subsidiaries which may come into the possession of
any Agent-Related Person.
10.7 INDEMNIFICATION.
The Lenders agree to indemnify each Agent-Related Person (to the extent
not reimbursed by the Borrowers and without limiting the obligation of the
Borrowers to do so), ratably according to their respective Pro Rata Shares from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever which may at any time (including without limitation at any time
following payment in full of the Obligations) be imposed on, incurred by or
asserted against such Agent-Related Person in any way relating to or arising out
of this Loan Agreement or the other Loan Documents or any documents contemplated
by or referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by such Agent-Related Person under or in
connection with any of the foregoing; provided that no Lender shall be liable
for the payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the gross negligence or willful misconduct of such Agent-Related
Person. If any indemnity furnished to the Administrative Agent for any purpose
shall, in the opinion of the Administrative Agent, be insufficient or become
impaired, the Administrative Agent may call for additional indemnity and cease,
or not commence, to do the acts indemnified against until such additional
indemnity (except against its gross negligence or willful misconduct) is
furnished. The agreements in this Section 10.7 shall survive the payment of the
Obligations and all other amounts payable hereunder and under the other Loan
Documents.
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10.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
The Person serving as the Administrative Agent and its Affiliates may
make loans to, accept deposits from and generally engage in any kind of business
with the Borrowers and their Subsidiaries as though the Person serving as the
Administrative Agent were not the Administrative Agent hereunder. With respect
to the Loans made and all obligations owing to it, the Person serving as the
Administrative Agent shall have the same rights and powers under this Loan
Agreement as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Person serving as the Administrative Agent in its individual capacity.
10.9 SUCCESSOR AGENT.
The Administrative Agent (a) may, at any time, resign upon 20 days
written notice to the Lenders or (b) may be removed for willful misconduct or
gross negligence by written notice from the Required Lenders; provided that no
consent of the Borrowers shall be required during the existence and continuation
of an Event of Default. Upon any such resignation or removal, the Required
Lenders shall have the right to appoint a successor Administrative Agent. In the
case of the Administrative Agent's resignation or removal, if no successor
Administrative Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment, within 45 days after the notice of
resignation or removal, then the retiring Administrative Agent shall select a
successor Administrative Agent provided such successor is a Lender hereunder or
an Eligible Assignee. If no such successor shall have been appointed by the
Administrative Agent, and shall have accepted such appointment, within 45 days
after such notice of resignation, such notice shall nevertheless become
effective and the Lenders shall perform all of the duties of the Administrative
Agent hereunder until such time, if any, as the Required Lenders appoint a
successor as provided above. Upon the acceptance of any appointment as the
Administrative Agent hereunder by a successor, if any, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Administrative
Agent, and the retiring or removed Administrative Agent shall be discharged from
its duties and obligations as the Administrative Agent, as appropriate, under
this Loan Agreement and the other Loan Documents and the provisions of this
Section 10.9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was the Administrative Agent under this Loan Agreement.
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SECTION 11.
MISCELLANEOUS
11.1 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device), (c)
the Business Day following the day on which the same has been delivered prepaid
or on an invoice arrangement to a reputable national overnight air courier
service, or (d) the third Business Day following the day on which the same is
sent by certified or registered mail, postage prepaid, in each case to the
respective parties at the address or telecopy numbers set forth on Schedule
11.1, or at such other address or numbers as such party may specify by written
notice to the other parties hereto.
11.2 RIGHT OF SET-OFF.
In addition to any rights now or hereafter granted under applicable law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default and the commencement of remedies described in
Section 9.2, each Lender is authorized at any time and from time to time,
without presentment, demand, protest or other notice of any kind (all of which
rights being hereby expressly waived), to set off and to appropriate and apply
any and all deposits (general or special) and any other indebtedness at any time
held or owing by such Lender (including, without limitation, branches, agencies
or Affiliates of such Lender wherever located) to or for the credit or the
account of any Borrower or its Subsidiaries against obligations and liabilities
of such Borrower to the Lenders hereunder, under the Notes, the other Loan
Documents or otherwise, irrespective of whether the Administrative Agent or the
Lenders shall have made any demand hereunder and although such obligations,
liabilities or claims, or any of them, may be contingent or unmatured, and any
such set-off shall be deemed to have been made immediately upon the occurrence
of an Event of Default even though such charge is made or entered on the books
of such Lender subsequent thereto. The Borrowers hereby agree that any Person
purchasing a participation in the Loans hereunder pursuant to Section 11.3(c) or
3.8 may exercise all rights of set-off with respect to its participation
interest as fully as if such Person were a Lender hereunder.
11.3 BENEFIT OF AGREEMENT.
(a) Generally. This Loan Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that none of the Borrowers
may assign and transfer any of its interests, rights or obligations
under any Loan Document (except as permitted by Sections 8.4 or 8.5)
without the prior written consent of all of the Lenders (and any
attempt at such assignment or transfer without such consent shall be
null and void); and provided further that the rights of each Lender to
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transfer, assign or grant participations in its rights and/or
obligations hereunder shall be limited as set forth in subsections (b)
and (c) of this Section 11.3. Notwithstanding the above (including
anything set forth in subsections (b) and (c) of this Section 11.3),
nothing herein shall restrict, prevent or prohibit any Lender from (A)
pledging or assigning a security interest in its rights hereunder or
under its Notes, if any, to secure obligations of such Lender,
including any pledge or assignment to a Federal Reserve Bank in support
of borrowings made by such Lender from such Federal Reserve Bank;
provided that no such pledge or assignment shall release a Lender from
any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto, or (B) granting assignments
or participations in such Lender's Loans hereunder to its parent
company and/or to any Affiliate of such Lender or to any existing
Lender or Affiliate thereof.
(b) Assignments. In addition to the assignments permitted by
Section 11.3(a), each Lender may, with the prior written consent of the
Borrowers and the Administrative Agent (provided that no consent of the
Borrowers shall be required during the existence and continuation of an
Event of Default), which consent shall not be unreasonably withheld or
delayed, assign all or a portion of its rights and obligations
hereunder pursuant to an assignment agreement substantially in the form
of Exhibit 11.3 to one or more Eligible Assignees; provided that (i)
any such assignment shall be in a minimum aggregate amount of
$5,000,000 of the Loans and in integral multiples of $1,000,000 above
such amount (or the remaining amount of Loans held by such Lender) and
(ii) each such assignment shall be of a constant, not varying,
percentage of all of the assigning Lender's rights and obligations
under the Loans being assigned. Any assignment hereunder shall be
effective upon satisfaction of the conditions set forth above and
delivery to the Administrative Agent of a duly executed assignment
agreement together with a transfer fee of $3,500 payable to the
Administrative Agent for its own account. Upon the effectiveness of any
such assignment, the assignee shall become a "Lender" for all purposes
of this Loan Agreement and the other Loan Documents and, to the extent
of such assignment, the assigning Lender shall be relieved of its
obligations hereunder to the extent of the Loans being assigned. The
Borrowers agree that upon notice of any assignment to an assignee that
was not theretofore a Lender, they will promptly provide to such
assignee a new Note. Each Lender agrees that, in the event it assigns
all of its Loans hereunder, it shall promptly return the Note or
Note(s) executed by the Borrowers in its favor.
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By executing and delivering an assignment agreement in
accordance with this Section 11.3(b), the assigning Lender thereunder
and the assignee thereunder shall be deemed to confirm to and agree
with each other and the other parties hereto as follows: (i) such
assigning Lender warrants that it is the legal and beneficial owner of
the interest being assigned thereby free and clear of any adverse claim
and the assignee warrants that it is an Eligible Assignee; (ii) except
as set forth in clause (i) above, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in
connection with this Loan Agreement, any of the other Loan Documents or
any other instrument or document furnished pursuant hereto or thereto,
or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Loan Agreement, any of the other Loan
Documents or any other instrument or document furnished pursuant hereto
or thereto or the financial condition of any Borrower or its
Subsidiaries or the performance or observance by any Loan Party of any
of its obligations under this Loan Agreement, any of the other Loan
Documents or any other instrument or document furnished pursuant hereto
or thereto; (iii) such assigning Lender and such assignee each
represents and warrants that it is legally authorized to enter into
such assignment agreement; (iv) such assignee confirms that it has
received a copy of this Loan Agreement, the other Loan Documents and
such other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into such assignment
agreement; (v) such assignee will independently and without reliance
upon the Administrative Agent, such assigning Lender or any other
Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Loan Agreement and the other
Loan Documents; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action on its behalf and to exercise
such powers under this Loan Agreement or any other Loan Document as are
delegated to the Administrative Agent by the terms hereof or thereof,
together with such powers as are reasonably incidental thereto; and
(vii) such assignee agrees that it will perform in accordance with
their terms all the obligations which by the terms of this Loan
Agreement and the other Loan Documents are required to be performed by
it as a Lender.
(c) Participations. Each Lender may, without the consent of,
or notice to, the Borrowers or the Administrative Agent, sell, transfer
or grant participations in all or any part of such Lender's interests
and obligations hereunder; provided that (i) such selling Lender shall
remain a "Lender" for all purposes under this Loan Agreement (such
selling Lender's obligations under the Loan Documents remaining
unchanged), the participant shall not constitute a Lender hereunder,
and the Borrowers, the Administrative Agent and the other Lenders shall
continue to deal with such selling Lender, and (ii) no such participant
shall have, or be granted, rights to approve any amendment or waiver
relating to this Loan Agreement or the other Loan Documents except to
the extent any such amendment or waiver would (A) reduce the principal
of or rate of interest on or fees in respect of any Loans in which the
participant is participating, or (B) postpone the date fixed for any
payment of principal (including the extension of the final maturity of
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any Loan or the date of any mandatory prepayment, other than pursuant
to Section 3.5), interest or fees in which the participant is
participating. In the case of any such participation, the participant
shall not have any rights under this Loan Agreement or the other Loan
Documents (the participant's rights against the selling Lender in
respect of such participation to be those set forth in the
participation agreement with such Lender creating such participation)
and all amounts payable by the Borrowers hereunder shall be determined
as if such Lender had not sold such participation; provided, however,
that such participant shall be entitled to receive additional amounts
under Sections 3.9, 3.12, 3.13 and 3.14 to the same extent that the
Lender from which such participant acquired its participation would be
entitled to the benefit of such cost protection provisions.
(d) The Administrative Agent shall maintain at the
Administrative Agent's office at the Agency Services Address a copy of
each assignment agreement delivered to it and a register for the
recordation of the names and addresses of the Lenders, and principal
amount of the Loans owing to, each Lender pursuant to the terms hereof
from time to time (the "Register"). The entries in the Register shall
be conclusive absent manifest error, and the Borrowers, the
Administrative Agent and the Lenders may treat each Person whose name
is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Loan Agreement, notwithstanding
notice to the contrary. The Register shall be available for inspection
by the Borrowers and any Lender, at any reasonable time and from time
to time upon reasonable prior notice.
11.4 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Loan Document and no course of dealing between the Borrowers and the
Administrative Agent or any Lender shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, power or privilege hereunder or
under any other Loan Document preclude any other or further exercise thereof or
the exercise of any other right, power or privilege hereunder or thereunder. The
rights and remedies provided herein are cumulative and not exclusive of any
rights or remedies which the Administrative Agent or any Lender would otherwise
have. No notice to or demand on any Loan Party in any case shall entitle any
Loan Party to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Administrative Agent
or the Lenders to any other or further action in any circumstances without
notice or demand.
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11.5 PAYMENT OF EXPENSES; INDEMNIFICATION.
The Borrowers jointly and severally agree to: (a) pay all reasonable
out-of-pocket costs and expenses of (i) each Agent-Related Person in connection
with (A) the negotiation, preparation, execution and delivery, syndication and
administration of this Loan Agreement and the other Loan Documents and the
documents and instruments referred to therein (including, without limitation,
the reasonable fees and expenses of Bingham McCutchen LLP, special counsel to
the Administrative Agent) and (B) any amendment, waiver or consent relating
hereto and thereto including, but not limited to, any such amendments, waivers
or consents resulting from or related to any work-out, renegotiation or
restructure relating to the performance by the Borrowers under this Loan
Agreement, and (ii) the Agent-Related Persons and the Lenders in connection with
(A) enforcement of the Loan Documents and the documents and instruments referred
to herein and therein, including, without limitation, in connection with any
such enforcement, the reasonable fees and disbursements of counsel for the
Agent-Related Persons and each of the Lenders, and (B) any bankruptcy or
insolvency proceeding of a Borrower or any of its Subsidiaries, and (b)
indemnify the Agent-Related Persons, each Lender and its officers, directors,
employees, representatives, Affiliates and agents from and hold each of them
harmless against any and all losses, liabilities, claims, damages or expenses
incurred by any of them as a result of, or arising out of, or in any way related
to, or by reason of, any investigation, litigation or other proceeding (whether
or not any Agent-Related Person or any Lender is a party thereto) related to (i)
the entering into and/or performance of any Loan Document or the use of proceeds
of any Loans or the consummation of any other transactions contemplated in any
Loan Document, including, without limitation, the reasonable fees and
disbursements of counsel incurred in connection with any such investigation,
litigation or other proceeding (but excluding any such losses, liabilities,
claims, damages or expenses to the extent incurred by reason of the gross
negligence or willful misconduct on the part of the Person to be indemnified),
(ii) any Environmental Claim and (iii) any claims for Non-Excluded Taxes.
11.6 AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Loan Agreement nor any other Loan Document nor any of the
terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing and signed by the Required Lenders and the Borrowers; provided that no
such amendment, change, waiver, discharge or termination shall without the
written consent of each Lender affected thereby:
(a) extend the final maturity of any Loan or any portion
thereof or postpone any other date fixed for any payment of principal;
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(b) reduce the rate or extend the time of payment of interest
(other than as a result of waiving the applicability of any
post-default increase in interest rates) thereon or fees hereunder;
(c) reduce or waive the principal amount of any Loan;
(d) change the Loans of a Lender from the amount thereof in
effect, other than pursuant to an assignment permitted under Sections
3.5 or 11.3(b) (it being further understood and agreed that a waiver of
any Default or Event of Default or a waiver of any mandatory reduction
in the Loans shall not constitute a change in the terms of any Loans of
any Lender);
(e) release either Borrower from its obligations, or release
all or substantially all of the Guarantors from their obligations,
under the Loan Documents; provided that the Administrative Agent may
release a Guarantor in accordance with Section 8.5 or in accordance
with Section 11.19;
(f) amend, modify or waive any provision of this Section 11.6
or Section 9.1(a) or any provision of any Loan Document which, by its
express terms, requires the consent, approval, agreement or
satisfaction of all of the Lenders;
(g) reduce any percentage specified in, or otherwise modify,
the definition of Required Lenders; or
(h) consent to the assignment or transfer by any Loan Party of
any of its rights and obligations under (or in respect of) the Loan
Documents other than any assignment or transfer by a Guarantor
permitted under this Loan Agreement.
If any amendment, waiver or consent with respect to the Loan Documents has been
delivered in writing to a Lender by the Administrative Agent, and such
amendment, waiver or consent requires only the approval of the Required Lenders
to become effective, then such Lender shall have ten Business Days from the date
of receipt of such amendment, waiver or consent to respond thereto. Failure of a
Lender to timely respond to such amendment, waiver or consent shall be deemed an
approval by such Lender of such amendment, waiver or consent.
No provision of Section 10 may be amended or modified without the consent of the
Administrative Agent.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Loans, and each
Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy
Code supersedes the unanimous consent provisions set forth herein and (y) the
Required Lenders may consent to allow a Loan Party to use cash collateral in the
context of a bankruptcy or insolvency proceeding.
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11.7 COUNTERPARTS/TELECOPY.
This Loan Agreement may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. Delivery of executed counterparts
by telecopy shall be as effective as an original and shall constitute a
representation that an original will be delivered.
11.8 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Loan Agreement.
11.9 DEFAULTING LENDER.
Each Lender understands and agrees that if such Lender is a Defaulting
Lender then notwithstanding the provisions of Section 11.6 it shall not be
entitled to vote on any matter requiring the consent of the Required Lenders or
to object to any matter requiring the consent of all the Lenders; provided,
however, that all other benefits and obligations under the Loan Documents shall
apply to such Defaulting Lender.
11.10 SURVIVAL OF INDEMNIFICATION AND REPRESENTATIONS AND WARRANTIES.
All indemnities set forth herein and all representations and warranties
made herein shall survive the execution and delivery of this Loan Agreement, the
making of the Loans and the repayment of the Loans and other Obligations.
11.11 GOVERNING LAW; JURISDICTION.
(a) THIS LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK. Any legal action or proceeding with respect
to this Loan Agreement or any other Loan Document may be brought in the
courts of the State of New York in New York County, or of the United
States for the Southern District of New York and, by execution and
delivery of this Loan Agreement, each Borrower hereby irrevocably
accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of such courts. Each Borrower further
irrevocably consents to the service of process out of any of the
aforementioned courts in any such action or proceeding by the mailing
of copies thereof by registered or certified mail, postage prepaid, to
it at the address for notices pursuant to Section 11.1, such service to
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become effective 15 days after such mailing. Nothing herein shall
affect the right of a Lender to serve process in any other manner
permitted by law or to commence legal proceedings or to otherwise
proceed against a Borrower in any other jurisdiction. Each Borrower
agrees that a final judgment in any 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; provided that nothing
in this Section 11.11(a) is intended to impair a Borrower's right under
applicable law to appeal or seek a stay of any judgment.
(b) Each Borrower hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Loan Agreement or any other Loan Document in the courts referred
to in subsection (a) hereof and hereby further irrevocably waives and
agrees not to plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an
inconvenient forum.
11.12 WAIVER OF JURY TRIAL.
EACH OF THE PARTIES TO THIS LOAN AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS LOAN AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY.
11.13 TIME.
All references to time herein shall be references to Eastern Standard
Time or Eastern Daylight Time, as the case may be, unless specified otherwise.
11.14 SEVERABILITY.
If any provision of any of the Loan Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
11.15 ENTIRETY.
This Loan Agreement together with the other Loan Documents represent
the entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Loan Documents or the transactions
contemplated herein and therein.
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11.16 BINDING EFFECT.
(a) This Loan Agreement shall become effective at such time as
all of the conditions set forth in Section 5.1 have been satisfied or
waived by the Lenders and it shall have been executed by the Borrowers
and the Administrative Agent, and the Administrative Agent shall have
received copies hereof (telefaxed or otherwise) which, when taken
together, bear the signatures of each Lender, and thereafter this Loan
Agreement shall be binding upon and inure to the benefit of the
Borrowers, the Administrative Agent and each Lender and their
respective successors and assigns.
(b) This Loan Agreement shall be a continuing agreement and
shall remain in full force and effect until all Loans, interest, fees
and other Obligations have been paid in full. Upon termination, the
Borrowers shall have no further obligations (other than the
indemnification provisions that survive) under the Loan Documents;
provided that should any payment, in whole or in part, of the
Obligations be rescinded or otherwise required to be restored or
returned by the Administrative Agent or any Lender, whether as a result
of any proceedings in bankruptcy or reorganization or otherwise, then
the Loan Documents shall automatically be reinstated and all amounts
required to be restored or returned and all costs and expenses incurred
by the Administrative Agent or any Lender in connection therewith shall
be deemed included as part of the Obligations.
11.17 CONFIDENTIALITY.
Each Lender agrees that it will use its reasonable best efforts to keep
confidential and to cause any representative designated under Section 7.11 to
keep confidential any non-public information from time to time supplied to it
under any Loan Document; provided, however, that nothing herein shall prevent
the disclosure of any such information to (a) the extent a Lender in good faith
believes such disclosure is required by Requirement of Law, (b) counsel for a
Lender or to its accountants and other advisors, (c) bank examiners, auditors or
comparable Persons or any regulatory body having jurisdiction over a Lender, (d)
any Affiliate of a Lender, (e) any other Lender, or any assignee, transferee or
participant, or, subject to an agreement containing provisions substantially the
same as those of this Section, (i) any potential assignee, transferee or
participant, of all or any portion of any Lender's rights under this Loan
Agreement who is notified of the confidential nature of the information or (ii)
any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Borrowers and their obligations, (f) any
other Person in connection with any litigation to which any one or more of the
Lenders is a party or (g) any other Person to whom disclosure of such
information a Lender believes is necessary or appropriate in its reasonable
judgment in connection with the exercise of remedies or enforcement of rights
hereunder; and provided further that no Lender shall have any obligation under
this Section 11.17 to the extent any such information becomes available on a
non-confidential basis from a source other than a Borrower or its Subsidiaries
or that any information becomes publicly available other than by a breach of
this Section 11.17.
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11.18 FURTHER ASSURANCES.
The Borrowers agree, upon the request of the Administrative Agent, to
promptly take such actions as are necessary to carry out the intent of this Loan
Agreement and the other Loan Documents.
11.19 RELEASE OF GUARANTORS.
If a Guarantor no longer qualifies as the owner of Unencumbered
Properties or becomes an Eligible Subsidiary, then, as long as no Default or
Event of Default exists after giving effect to such event, the Lenders agree to
release such Guarantor from its obligations hereunder.
11.20 USA PATRIOT ACT.
Each Lender hereby notifies the Borrowers that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the "Act"), it is required to obtain, verify and record
information that identifies the Borrowers, which information includes the name
and address of the Borrowers and other information that will allow such Lender
to identify the Borrowers in accordance with the Act.
11.21 LIMITATION ON LIABILITY.
Each Borrower waives any right to assert or make any claim against any
Lender, or the Administrative Agent for (or to sue any Lender, or the
Administrative Agent upon any claim for) any special, indirect, incidental,
punitive or consequential damages in respect of any breach or wrongful conduct
(whether the claim is based on contract, tort or duty imposed by law) in
connection with, arising out of or in any way related to this Loan Agreement,
any other Loan Document or the transactions contemplated hereby or thereby, or
any act, omission or event in connection therewith.
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Each of the parties hereto has caused a counterpart of this Loan
Agreement to be duly executed and delivered as of the date first above written.
BORROWERS: BRANDYWINE REALTY TRUST,
a Maryland real estate investment trust
By: /s/ Gerard H. Sweeney
--------------------------------
Name: Gerard H. Sweeney
Title: President and Chief Executive Officer
BRANDYWINE OPERATING
PARTNERSHIP,
L.P., a Delaware limited partnership
By: Brandywine Realty Trust, a
Maryland real estate investment
trust, its general partner
By: /s/ Gerard H. Sweeney
--------------------------------
Name: Gerard H. Sweeney
Title: President and Chief
Executive Officer
LENDERS:
JPMORGAN CHASE BANK, N.A., as
Administrative Agent, and individually as a Lender
By: /s/ Marc E. Costantino
--------------------------------------------------
Name: Marc E. Costantino
Title: Vice President