Exhibit 10.1
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SECOND AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
dated as of September 15, 1997
among
CARRAMERICA REALTY CORPORATION,
CARR REALTY, L.P.,
CARRAMERICA REALTY, L.P.,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Bank and as Lead Agent for the Banks,
COMMERZBANK AKTIENGESELLSCHAFT, NEW YORK BRANCH,
as Bank and as Co-Agent for the Banks,
NATIONSBANK, N.A.,
as Bank and as Co-Agent for the Banks,
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Bank and as Co-Agent for the Banks,
BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Bank and as Co-Agent for the Banks,
and
THE BANKS LISTED HEREIN
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SECOND AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
SECOND AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT, dated
as of September 15, 1997, among CARRAMERICA REALTY CORPORATION ("Carr"), CARR
REALTY, L.P. ("Carr LP"; Carr and Carr LP each, a "Borrower" and collectively,
the "Borrowers"), CARRAMERICA REALTY, L.P. ("CarrAmerica LP"), MORGAN GUARANTY
TRUST COMPANY OF NEW YORK, as Bank and as Lead Agent for the Banks, COMMERZBANK
AKTIENGESELLSCHAFT, NEW YORK BRANCH, as Bank and as Co-Agent for the Banks,
NATIONSBANK, N.A., as Bank and as Co-Agent for the Banks, WELLS FARGO BANK,
NATIONAL ASSOCIATION, as Bank and as Co-Agent for the Banks, BANK OF AMERICA
NATIONAL TRUST AND SAVINGS ASSOCIATION (successor by merger to Bank of America
Illinois), as Bank and as Co-Agent for the Banks (collectively, the
"Co-Agents"), and the BANKS listed on the signature pages hereof (the "Banks").
W I T N E S S E T H:
WHEREAS, the Borrowers, CarrAmerica LP and the Lead Agent
entered into the Revolving Credit Agreement, dated as of May 23, 1996 which was
amended and restated by the Borrowers, CarrAmerica LP, the Lead Agent, the
Co-Agents and the Banks as that certain Amended and Restated Revolving Credit
Agreement, dated as of August 23, 1996, as amended by the First Amendment to
Amended and Restated Revolving Credit Agreement, dated as of October 18, 1996,
the Second Amendment to Amended and Restated Revolving Credit Agreement, dated
as of March 31, 1997, and the Third Amendment to Amended and Restated Revolving
Credit Agreement, dated as of July 29, 1997 (the "Existing Credit Agreement");
and
WHEREAS, the parties hereto have agreed to amend and restate
the terms and conditions contained in the Existing Credit Agreement in their
entirety as hereinafter set forth.
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NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
I. The Existing Credit Agreement is hereby modified so that
all of the terms and conditions of the aforesaid Existing Credit Agreement shall
be restated in their entirety as set forth herein, and the Borrowers and
CarrAmerica LP agree to comply with and be subject to all of the terms,
covenants and conditions of this Agreement.
II. This Agreement shall be binding upon and inure to the
benefit of the parties hereto, and their respective successors and assigns, and
shall be deemed to be effective as of the date hereof.
III. Any reference in the Notes, any other Loan Document or
any other document executed in connection with this Agreement to the Existing
Credit Agreement shall be deemed to refer to this Agreement.
ARTICLE I
DEFINITIONS
SECTION 1.1. Definitions. The following terms, as used herein,
have the following meanings:
"Absolute Rate Auction" means a solicitation of Money Market
Quotes setting forth Money Market Absolute Rates pursuant to Section 2.3.
"Adjusted London Interbank Offered Rate" has the meaning set
forth in Section 2.7(b).
"Administrative Questionnaire" means, with respect to each
Bank, an administrative questionnaire in the form prepared by the Lead Agent and
submitted to the Lead Agent (with a copy to the Borrowers) duly completed by
such Bank.
"Agreement" means this Second Amended and Restated Revolving
Credit Agreement as the same may from time to time hereafter be modified,
supplemented or amended.
"Annual EBITDA" means, measured as of the last day of each
calendar quarter, an amount equal to (i) total revenues relating to all Real
Property Assets of the Borrowers and their Consolidated Subsidiaries or to the
Borrowers' interest in Minority Holdings for the previous four consecutive
calendar quarters including the quarter then ended, calculated in accordance
with GAAP, plus (ii) interest and other income of the Borrowers and their
Consolidated Subsidiaries, including, without limitation, real estate service
revenues, for such period, less (iii) total operating expenses and other
expenses relating to such Real Property Assets and to the Borrowers' interest in
Minority Holdings for such period (other than interest, income taxes,
depreciation, amortization, and other non-cash items), less (iv) total corporate
operating expenses (including general overhead expenses) and other expenses of
the Borrowers, their Consolidated Subsidiaries and the Borrowers' interest in
Minority Holdings (other than interest, taxes, depreciation, amortization and
other non-cash items), for such period.
"Applicable Interest Rate" means the lesser of (x) the rate at
which the interest rate applicable to any floating rate Indebtedness could be
fixed, at the time of calculation, by the applicable Borrower entering into an
unsecured interest rate swap agreement (or, if such rate is incapable of being
fixed by entering into an unsecured interest rate swap agreement at the time of
calculation, a reasonably determined fixed rate equivalent), and (y) the rate at
which the interest rate applicable to such floating rate Indebtedness is
actually capped, at the time of calculation, if such Borrower has entered into
an interest rate cap agreement with respect thereto.
"Applicable Lending Office" means, with respect to any Bank,
(i) in the case of its Base Rate Loans, its Domestic Lending Office, (ii) in the
case of its Euro-Dollar Loans, its Euro-Dollar Lending Office and (iii) in the
case of its Money Market Loans, its Money Market Lending Office.
"Applicable Margin" means, with respect to each Loan, the
respective percentages per annum determined based on the range into which the
rating or "shadow" rating on Carr's senior long-term unsecured debt then falls,
in accordance with the following table. Any change in Carr's Investment Grade
Rating causing it to
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move to a different range on the table shall effect an immediate change in the
Applicable Margin. In the event that Carr receives two (2) Investment Grade
Ratings that are not equivalent, the Applicable Margin shall be determined by
the lower of such two (2) Investment Grade Ratings, at least one of which shall
be an Investment Grade Rating from S&P or Moody's. In the event Carr receives
more than two (2) ratings (from S&P, Moody's, Duff & Phelps or Fitch) and such
ratings are not equivalent, the Applicable Margin shall be determined by the
lower of the two highest ratings; provided that each of said two (2) highest
ratings shall be Investment Grade Ratings and at least one of which shall be an
Investment Grade Rating from S&P or Moody's.
Range of
Carr's Applicable Applicable
Credit Rating Margin for Margin for Euro
(S&P/Moody's Loans Base Rate Dollar Loans
Ratings) (% per annum) (% per annum)
- ------------------ ------------ --------------
BBB-/Baa3 0 .95
BBB/Baa2 0 .80
BBB+/Baa1 0 .70
The Applicable Margin for so long as Carr shall not have
obtained two Investment Grade Ratings (at least one of which shall be from S&P
or Moody's) or after Borrower loses its Investment Grade Rating, shall be as
follows:
Applicable
Margin for Applicable
Base Rate Margin for Euro
Loans Dollar Loans
(% per annum) (% per annum)
------------- --------------
0 1.35
Lead Agent shall notify the Banks in writing promptly after it
obtains knowledge of any change in Carr's Investment Grade Rating which shall
effect a change in the Applicable Margin.
"Assignee" has the meaning set forth in Section 9.6(c).
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"Bank" means each bank listed on the signature pages hereof,
each Assignee which becomes a Bank pursuant to Section 9.6(c), and their
respective successors and each Designated Lender; provided, however, that the
term "Bank" shall exclude each Designated Lender when used in reference to a
Committed Loan, the Commitments or terms relating to the Committed Loans and the
Commitments and shall further exclude each Designated Lender for all other
purposes hereunder except that any Designated Lender which funds a Money Market
Loan shall, subject to Section 9.6(d), have the rights (including the rights
given to a Bank contained in Section 9.3 and otherwise in Article 9) and
obligations of a Bank associated with holding such Money Market Loan.
"Bankruptcy Code" means Title 11 of the United States Code,
entitled "Bankruptcy", as amended from time to time, and any successor statute
or statutes.
"Base Rate" means, for any day, a rate per annum equal to the
higher of (i) the Prime Rate for such day and (ii) the sum of 1/2 of 1% plus the
Federal Funds Rate for such day.
"Base Rate Loan" means a Committed Loan to be made by a Bank
as a Base Rate Loan in accordance with the applicable Notice of Committed
Borrowing or pursuant to Article VIII.
"Benefit Arrangement" means at any time an employee benefit
plan within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means either (i) Carr and its successors or (ii)
Carr LP and its successors, and, collectively, "Borrowers" shall mean both
Borrowers.
"Borrowers LTV Ratio" means the ratio, expressed as a
percentage and calculated on a quarterly basis by Carr, of the aggregate amount
of all Unsecured Debt (inclusive of the Loans) of Borrowers, CarrAmerica LP,
their Consolidated Subsidiaries and Borrowers' and CarrAmerica LP's pro rata
share of all Unsecured Debt of any Subsidiaries which are not Consolidated
Subsidiaries outstanding as of the date of determination, to the Unencumbered
Asset Pool Properties Value as of the date of determination.
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"Borrowing" means a borrowing hereunder consisting of Loans
made to the Borrowers or CarrAmerica LP at the same time by the Banks pursuant
to Article II. A Borrowing is a "Domestic Borrowing" if such Loans are Base Rate
Loans, a "Euro-Dollar Borrowing" if such Loans are Euro-Dollar Loans or a "Money
Market Borrowing" if such Loans are Money Market Loans.
"Capital Expenditures" means, for any period, the sum of all
expenditures (whether paid in cash or accrued as a liability) by Carr, Carr LP
or CarrAmerica LP, as applicable, which are capitalized on the consolidated
balance sheet of such Borrower in conformity with GAAP, but less all
expenditures made with respect to the acquisition by Carr or Carr LP and their
Consolidated Subsidiaries of any interest in real property within nine months
after the date such interest in real property is acquired.
"Carr LP LTV Ratio" means the ratio, expressed as a percentage
and calculated on a quarterly basis by Carr LP, of the aggregate amount of the
sum of the Tranche B Loans outstanding and all other Unsecured Debt of Carr LP
and its Consolidated Subsidiaries and Carr LP's pro rata share of all Unsecured
Debt of any Subsidiaries which are not Consolidated Subsidiaries of Carr LP as
of the date of determination, to the Carr LP Unencumbered Asset Pool Properties
Value as of the date of determination.
"Carr LP Maximum Total Debt Ratio" means the ratio as of the
date of determination of (i) the sum of (x) the aggregate Debt of Carr LP and
its Consolidated Subsidiaries and (y) Carr LP's pro rata share of the Debt of
any Subsidiaries of Carr LP which are not Consolidated Subsidiaries, at the time
of determination to (ii) Carr LP Tangible FMV.
"Carr LP Tangible FMV" means the sum of (x) (i) with respect
to Real Property Assets owned by Carr LP or its Consolidated Subsidiaries for a
period of at least six months, the quotient of Net Operating Income with respect
to such Real Property Assets determined as of the last day of the previous
calendar quarter, less reserves for Capital Expenditures of $.50 per square foot
per annum for Real Property Asset, as divided by the FMV Cap Rate, and (ii) with
respect to Real Property Assets owned by Carr LP or its Consolidated
Subsidiaries for a period of less than six months, the purchase price of such
Real Property Assets and
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(y) Cash or Cash Equivalents of Carr LP and its Consolidated Subsidiaries as of
the date of determination.
"Carr LP Unencumbered Asset Pool Properties" means, as of any
date, the Real Property Assets listed in Exhibit B-2 attached hereto and made a
part hereof, each of which is 100% owned in fee (or leasehold in the case of
assets listed as such on Exhibit B-2) by Carr LP or any Consolidated Subsidiary
of Carr LP and each of which is not subject to any Lien (other than Permitted
Liens), subject to adjustment as set forth herein, together with all New
Acquisitions or Real Property Assets which have become part of the Carr LP
Unencumbered Asset Pool Properties as of such date in accordance with Section
3.3 and excluding any Carr LP Unencumbered Asset Pool Properties which have been
released from this Agreement and the other Loan Documents as of such date in
accordance with Sections 5.13 and 5.14 and all other terms of this Agreement.
"Carr LP Unencumbered Asset Pool Properties Value" means the
aggregate of (i) with respect to the Carr LP Unencumbered Asset Pool Properties
owned by Carr LP or any of its Consolidated Subsidiaries for a period of at
least six months, the quotient of (x) Net Operating Income with respect to the
Carr LP Unencumbered Asset Pool Properties less reserves for Capital
Expenditures of $.50 per square foot per annum for each Carr LP Unencumbered
Asset Pool Property and (y) the FMV Cap Rate and (ii) with respect to the Carr
LP Unencumbered Asset Pool Properties owned by Carr LP or any of its
Consolidated Subsidiaries for a period of less than six months, the lesser of
(A) the quotient of (x) Net Operating Income with respect to the Carr LP
Unencumbered Asset Pool Properties less reserves for Capital Expenditures of
$.50 per square foot per annum for each Carr LP Unencumbered Asset Pool Property
and (y) the FMV Cap Rate and (B) the purchase price of such Carr LP Unencumbered
Asset Pool Property.
"Carr LTV Ratio" means the ratio, expressed as a percentage
and calculated on a quarterly basis by Carr, of the aggregate amount of the sum
of the Tranche A Loans and all other Unsecured Debt of Carr and its Consolidated
Subsidiaries (other than Carr LP) and Carr's pro rata share of all Unsecured
Debt of any Subsidiaries which are not Consolidated Subsidiaries of Carr,
outstanding as of the date of determination, to the Carr Unencumbered Asset Pool
Properties Value as of the date of determination.
"Carr Maximum Total Debt Ratio" means the ratio as of the date
of determination of (i) the sum of (x) the aggregate Debt of Carr and its
Consolidated Subsidiaries (other than Carr LP) and (y) Carr's pro rata share of
the Debt of any Subsidiaries of Carr which are not Consolidated
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Subsidiaries, at the time of determination to (ii) Carr Tangible FMV.
"Carr Tangible FMV" means the sum of (x) (i) with respect to
Real Property Assets owned by Carr or its Consolidated Subsidiaries (other than
Carr LP) for a period of at least six months, the quotient of Net Operating
Income with respect to such Real Property Assets determined as of the last day
of the previous calendar quarter, less reserves for Capital Expenditures of $.50
per square foot per annum for each Real Property Asset, as divided by the FMV
Cap Rate, and (ii) with respect to Real Property Assets owned by Carr or its
Consolidated Subsidiaries (other than Carr LP) for a period of less than six
months, the purchase price of such Real Property Assets and (y) Cash or Cash
Equivalents of Carr and its Consolidated Subsidiaries (other than Carr LP) as of
the date of determination.
"Carr Unencumbered Asset Pool Properties" means, as of any
date, the Real Property Assets listed in Exhibit B-1 attached hereto and made a
part hereof, each of which is 100% owned in fee (or leasehold in the case of
assets listed as such on Exhibit B-1) by Carr or any Consolidated Subsidiary of
Carr (other than Carr LP) and each of which is not subject to any Lien (other
than Permitted Liens), subject to adjustment as set forth herein, together with
all New Acquisitions or Real Property Assets which have become part of the Carr
Unencumbered Asset Pool Properties as of such date in accordance with Section
3.3 and excluding any Carr Unencumbered Asset Pool Properties which have been
released from this Agreement and the other Loan Documents as of such date in
accordance with Sections 5.13 and 5.14 and all other terms of this Agreement.
"Carr Unencumbered Asset Pool Properties Value" means the
aggregate of (i) with respect to the Carr Unencumbered Asset Pool Properties
owned by Carr or any of its Consolidated Subsidiaries (other than Carr LP) for a
period of at least six months, the quotient of (x) Net Operating Income with
respect to the Carr Unencumbered Asset Pool Properties less reserves for Capital
Expenditures of $.50 per square foot per annum for each Carr Unencumbered Asset
Pool Property and (y) the FMV Cap Rate and (ii) with respect to the Carr
Unencumbered Asset Pool Properties owned by Carr or any of its Consolidated
Subsidiaries (other than Carr LP) for a period of less than six months, the
lesser of (A) the quotient of (x) Net Operating Income with respect to the Carr
Unencumbered Asset Pool Properties less reserves of $.50 per square foot per
annum for each Carr Unencumbered Asset Pool Property and (y) the FMV Cap Rate
and (B) the purchase price of such Carr Unencumbered Asset Pool Property.
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"Cash or Cash Equivalents" means (i) cash, (ii) direct
obligations of the United States Government, including, without limitation,
treasury bills, notes and bonds, (iii) interest bearing or discounted
obligations of Federal agencies and Government sponsored entities or pools of
such instruments offered by banks rated AA or better by S&P or Aa2 by Moody's
and dealers, including, without limitation, Federal Home Loan Mortgage
Corporation participation sale certificates, Government National Mortgage
Association modified pass-through certificates, Federal National Mortgage
Association bonds and notes, Federal Farm Credit System securities, (iv) time
deposits, domestic and Eurodollar certificates of deposit, bankers acceptances,
commercial paper rated at least A-1 by S&P and P-1 by Moody's, and/or guaranteed
by an Aa rating by Moody's, an AA rating by S&P, or better rated credit,
floating rate notes, other money market instruments and letters of credit each
issued by banks which have a long-term debt rating of at least AA by S&P or Aa2
by Moody's, (v) obligations of domestic corporations, including, without
limitation, commercial paper, bonds, debentures, and loan participations, each
of which is rated at least AA by S&P, and/or Aa2 by Moody's, and/or
unconditionally guaranteed by an AA rating by S&P, an Aa2 rating by Moody's, or
better rated credit, (vi) obligations issued by states and local governments or
their agencies, rated at least MIG-1 by Moody's and/or SP-1 by S&P and/or
guaranteed by an irrevocable letter of credit of a bank with a long-term debt
rating of at least AA by S&P or Aa2 by Moody's, (vii) repurchase agreements with
major banks and primary government securities dealers fully secured by U.S.
Government or agency collateral equal to or exceeding the principal amount on a
daily basis and held in safekeeping, and (viii) real estate loan pool
participations, guaranteed by an entity with an AA rating given by S&P or an Aa2
rating given by Moody's, or better rated credit.
"Closing Date" means the date on which the Lead Agent shall
have received the documents specified in or pursuant to Section 3.1.
"Commitment" means, collectively, the Tranche A Commitment and
the Tranche B Commitment with respect to each Bank.
"Committed Loan" means a Loan made by a Bank pursuant to
Section 2.1; provided that, if any such Loan or Loans (or portions thereof) are
combined or subdivided
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pursuant to a Notice of Interest Rate Election, the term "Committed 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.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity which is consolidated with either Borrower in accordance with GAAP.
"Consolidated Tangible Net Worth" means at any date the
consolidated stockholders' equity of Carr (determined on a book basis), less its
consolidated Intangible Assets, all determined as of such date. For purposes of
this definition "Intangible Assets" means with respect to any such intangible
assets, the amount (to the extent reflected in determining such consolidated
stockholders' equity) of all write-ups subsequent to December 31, 1995 in the
book value of any asset owned by either Borrower or a Consolidated Subsidiary
and (ii) goodwill, patents, trademarks, service marks, trade names, anticipated
future bene- fit of tax loss carry forwards, copyrights, organization or
developmental expenses and other intangible assets.
"Contingent Obligation" as to any Person means, without
duplication, (i) any contingent obligation of such Person required to be shown
on such Person's balance sheet in accordance with GAAP, and (ii) any obligation
required to be disclosed in the footnotes to such Person's financial statements,
guaranteeing partially or in whole any non-recourse Debt, lease, dividend or
other obligation, exclusive of contractual indemnities (including, without
limitation, any indemnity or price-adjustment provision relating to the purchase
or sale of securities or other assets) and guarantees of non-monetary
obligations (other than guarantees of completion) which have not yet been called
on or quantified, of such Person or of any other Person. The amount of any
Contingent Obligation described in clause (ii) shall be deemed to be (a) with
respect to a guaranty of interest or interest and principal, or operating income
guaranty, the sum of all payments required to be made thereunder (which in the
case of an operating income guaranty shall be deemed to be equal to the debt
service for the note secured thereby), calculated at the Applicable Interest
Rate, through (i) in the case of an interest or interest and principal guaranty,
the stated date of maturity of the obligation (and commencing on the date
interest could first
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be payable thereunder), or (ii) in the case of an operating income guaranty, the
date through which such guaranty will remain in effect, and (b) with respect to
all guarantees not covered by the preceding clause (a), an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
guaranty is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is required to
perform thereunder) as recorded on the balance sheet and on the footnotes to the
most recent financial statements of the applicable Borrower required to be
delivered pursuant to Section 5.1 hereof. Notwithstanding anything contained
herein to the contrary, guarantees of completion shall not be deemed to be
Contingent Obligations unless and until a claim for payment or performance has
been made thereunder, at which time any such guaranty of completion shall be
deemed to be a Contingent Obligation in an amount equal to any such claim.
Subject to the preceding sentence, (i) in the case of a joint and several
guaranty given by such Person and another Person (but only to the extent such
guaranty is recourse, directly or indirectly to the applicable Borrower), the
amount of the guaranty shall be deemed to be 100% thereof unless and only to the
extent that such other Person has delivered Cash or Cash Equivalents to secure
all or any part of such Person's guaranteed obligations, (ii) in the case of
joint and several guarantees given by a Person in whom the applicable Borrower
owns an interest (which guarantees are non-recourse to the applicable Borrower),
to the extent the guarantees, in the aggregate, exceed 15% of total real estate
investments, the amount in excess of 15% shall be deemed to be a Contingent
Obligation of the applicable Borrower, and (iii) in the case of a guaranty
(whether or not joint and several) of an obligation otherwise constituting Debt
of such Person, the amount of such guaranty shall be deemed to be only that
amount in excess of the amount of the obligation constituting Debt of such
Person. Notwithstanding anything contained herein to the contrary, "Contingent
Obligations" shall not be deemed to include guarantees of Unused Commitments or
of construction loans to the extent the same have not been drawn.
"Credit Rating" means the ratings assigned by not less than
two of the Rating Agencies (at least one of which shall be S&P) to Carr's senior
long-term unsecured indebtedness.
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"Debt" of any Person means, without duplication, (A) as shown
on such Person's consolidated balance sheet (i) all indebtedness of such Person
for borrowed money or for the deferred purchase price of property and, (ii) all
indebtedness of such Person evidenced by a note, bond, debenture or similar
instrument (whether or not disbursed in full in the case of a construction
loan), (B) the face amount of all letters of credit issued for the account of
such Person and, without duplication, all unreimbursed amounts drawn thereunder,
(C) all Contingent Obligations of such Person, (D) all payment obligations of
such Person under any interest rate protection agreement (including, without
limitation, any interest rate swaps, caps, floors, collars and similar
agreements) and currency swaps and similar agreements which were not entered
into specifically in connection with Debt set forth in clauses (A), (B) or (C)
hereof. For purposes of this Agreement, Debt (other than Contingent Obligations)
of the applicable Borrower shall be deemed to include only the applicable
Borrower's pro rata share (such share being based upon the applicable Borrower's
percentage ownership interest as shown on the applicable Borrower's annual
audited financial statements) of the Debt of any Person in which the applicable
Borrower, directly or indirectly, owns an interest, provided that such Debt is
nonrecourse, both directly and indirectly, to the applicable Borrower.
"Debt Service" means, measured as of the last day of each
calendar quarter, an amount equal to the sum of (i) interest (whether accrued,
paid or capitalized) actually payable by either Borrower or the Borrowers on its
Debt for the previous four consecutive quarters including the quarter then
ended, plus (ii) scheduled payments of principal on such Debt, whether or not
paid by either Borrower or the Borrowers (excluding balloon payments) for the
previous four consecutive quarters including the quarter then ended.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or both
would, unless cured or waived, become an Event of Default.
"Designated Lender" means a special purpose corporation that
(i) shall have become a party to this Agreement pursuant to Section 9.6(d), and
(ii) is not otherwise a Bank.
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"Designated Lender Notes" means promissory notes of the
Borrower, substantially in the form of Exhibit A-3 and Exhibit A-4 hereto,
evidencing the obligation of the Borrower to repay Money Market Loans made by
Designated Lenders, and "Designated Lender Note" means any one of such
promissory notes issued under Section 9.6(d) hereof.
"Designating Lender" has the meaning set forth in Section
9.6(d) hereof.
"Designation Agreement" means a designation agreement in
substantially the form of Exhibit G attached hereto, entered into by a Bank and
a Designated Lender and accepted by the Lead Agent.
"Domestic Business Day" means any day except a Saturday,
Sunday or other day on which commercial banks in New York City are authorized by
law to close.
"Domestic Lending Office" means, as to each Bank, its office
located within the United States at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its Domestic
Lending Office) or such other office within the United States as such Bank may
hereafter designate as its Domestic Lending Office by notice to the Borrowers
and the Lead Agent.
"Duff & Phelps" means Duff & Phelps Credit Rating Co. or any
successor thereto.
"Environmental Affiliate" means any partnership, or joint
venture, trust or corporation in which an equity interest is owned by either
Borrower or CarrAmerica LP, either directly or indirectly.
"Environmental Approvals" means any permit, license, approval,
ruling, variance, exemption or other autho- rization required under applicable
Environmental Laws.
"Environmental Claim" means, with respect to any Person, any
notice, claim, demand or similar communication (written or oral) by any other
Person alleging potential liability for investigatory costs, cleanup costs,
governmental response costs, natural resources damage, property damages,
personal injuries, fines or penalties arising out of, based on or resulting from
(i) the presence, or release into the environment, of any Material of
Environmental
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Concern at any location, whether or not owned by such Person or (ii)
circumstances forming the basis of any violation, or alleged violation, of any
Environmental Law, in each case as to which there is a reasonable likelihood of
an adverse determination with respect thereto and which, if adversely
determined, would have a Material Adverse Effect.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating to
the environment, the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Substances or
hazardous wastes into the environment including, without limitation, ambient
air, surface water, ground water, or land, or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of pollutants, contaminants, Hazardous Substances or
hazardous wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, or any successor statute.
"ERISA Group" means the Borrowers, any Subsidiary and all
members of a controlled group of corporations and all trades or businesses
(whether or not incorporated) under common control which, together with the
Borrowers or any Subsidiary, are treated as a single employer under Section 414
of the Internal Revenue Code.
"Euro-Dollar Borrowing" has the meaning set forth in Section
1.3.
"Euro-Dollar Business Day" means any Domestic Business Day on
which commercial banks are open for international business (including dealings
in dollar deposits) in London.
"Euro-Dollar Lending Office" means, as to each Bank, its
office, branch or affiliate located at its address set forth in its
Administrative Questionnaire (or identified in its Administrative Questionnaire
as its Euro-Dollar Lending Office) or such other office, branch or affiliate of
such Bank as it may hereafter designate as its Euro-Dollar
14
Lending Office by notice to the Borrowers and the Lead Agent.
"Euro-Dollar Loan" means a Committed Loan to be made by a Bank
as a Euro-Dollar Loan in accordance with the applicable Notice of Committed
Borrowing or Notice of Interest Rate Election.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.7(b).
"Event of Default" has the meaning set forth in Section 6.1.
"Facility Fee" has the meaning set forth in Section 2.8(a).
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, 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 Domestic
Business Day next succeeding such day, provided that (i) if such day is not a
Domestic Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Domestic Business Day as so published on
the next succeeding Domestic Business Day, and (ii) if no such rate is so
published on such next succeeding Domestic Business Day, the Federal Funds Rate
for such day shall be the average rate quoted to Morgan Guaranty Trust Company
of New York on such day on such transactions as determined by the Lead Agent.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System as constituted from time to time.
"FFO" means "funds from operations," defined to mean net
income (loss) (computed in accordance with GAAP), excluding gains (or losses)
from debt restructurings and sales of properties, plus depreciation and
amortization, after adjustments for Minority Holdings. Adjustments for Minority
Holdings will be calculated to reflect FFO on the same basis.
"Fitch" means Fitch Investors Services, L.P. or any successor
thereto.
15
"FMV Cap Rate" means 9.75%.
"Fronting Bank" shall mean Morgan or such other Bank which
Borrower is notified by the Lead Agent may be a Fronting Bank and which is
designated by Borrower in its Notice of Borrowing as the Bank which shall issue
a Letter of Credit with respect to such Notice of Borrowing.
"GAAP" means generally accepted accounting principles
recognized as such in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
Board or in such other statements by such other entity as may be approved by a
significant segment of the accounting profession, which are applicable to the
circumstances as of the date of determination.
"Group of Loans" means, at any time, a group of Loans
consisting of (i) all Committed Loans which are Base Rate Loans at such time or
(ii) all Committed Loans which are Euro-Dollar Loans having the same Interest
Period at such time; provided that, if a Committed Loan of any particular Bank
is converted to or made as a Base Rate Loan pursu- ant to Section 8.2 or 8.4,
such Loan shall be included in the same Group or Groups of Loans from time to
time as it would have been in if it had not been so converted or made.
"Hazardous Substances" means any toxic, radioactive, caustic
or otherwise hazardous substance, including petroleum, its derivatives,
by-products and other hydrocarbons, or any substance having any constituent
elements displaying any of the foregoing characteristics.
"Indemnitee" has the meaning set forth in Section 9.3(b).
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing specified in the
Notice of Committed Borrowing or the date of continuation or conversion
specified in the Notice of Interest Rate Election, as the case may be, and
ending one, two, three or six months thereafter, as each Borrower or CarrAmerica
LP, as the case may be, may elect in the applicable Notice of Committed
Borrowing or in the Notice of Interest Rate Election; provided that:
16
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business
Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clause (c) below, end on the last
Euro-Dollar Business Day of a calendar month; and
(c) if any Interest Period includes a date on which a payment
of principal of the Loans is required to be made under Section 2.10 but
does not end on such date, then (i) the principal amount (if any) of
each Euro-Dollar Loan required to be repaid on such date shall have an
Interest Period ending on such date and (ii) the remainder (if any) of
each such Euro-Dollar Loan shall have an Interest Period determined as
set forth above.
(2) with respect to each Base Rate Borrowing, the period commencing on the date
of such Borrowing specified in the Notice of Committed Borrowing or the date of
conversion specified in the Notice of Interest Rate Election, as the case may
be, and ending 30 days thereafter; provided that:
(a) any Interest Period (other than an Interest Period
determined pursuant to clause (c)(i) above) which would otherwise end
on a day which is not a Euro-Dollar Business Day shall be extended to
the next succeeding Euro-Dollar Business Day; and
(b) if any Interest Period includes a date on which a payment
of principal of the Loans is required to be made under Section 2.10 but
does not end on such date, then (i) the principal amount (if any) of
each Base Rate Loan required to be repaid on such date shall have an
Interest Period ending on such date and (ii) the remainder (if any) of
each such Base Rate Loan shall have an Interest Period determined as
set forth above.
17
(3) with respect to each Money Market LIBOR Loan, the period commencing on the
date of such Borrowing specified in the applicable Notice of Money Market
Borrowing and ending one, two, three or six months thereafter, as the Borrower
may elect in the applicable Notice of Money Market Borrowing in accordance with
Section 2.3; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall be extended to the next
succeeding Euro-Dollar Business Day unless such Euro-Dollar Business
Day falls in another calendar month, in which case such Interest Period
shall end on the next preceding Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) shall, subject to clause (c) below, end on the last
Euro-Dollar Business Day of a calendar month;
(c) if any Interest Period includes a date on which a payment
of principal of the Loans is required to be made under Section 2.10 but
does not end on such date, then (i) the principal amount (if any) of
each Money Market LIBOR Loan required to be repaid on such date shall
have an Interest Period ending on such date, and (ii) the remainder (if
any) of each such Money Market LIBOR Loan shall have an Interest Period
determined as set forth above; and
(d) any Interest Period which would otherwise end after the
Maturity Date shall end on the Maturity Date.
(4) with respect to each Money Market Absolute Rate Loan, the period commencing
on the date of such Borrowing specified in the applicable Notice of Money Market
Borrowing and ending such number of days thereafter (but not less than 14 days
or more than 180 days) as the Borrower may elect in the applicable Notice of
Money Market Borrowing in accordance with Section 2.3; provided that:
(a) any Interest Period which would otherwise end on a day
which is not a Euro-Dollar Business Day shall
18
be extended to the next succeeding Euro-Dollar Business Day; and
(b) if any Interest Period includes a date on which a payment
of principal of the Loans is required to be made under Section 2.10 but
does not end on such date, then (i) the principal amount (if any) of
each Money Market Absolute Rate Loan required to be repaid on such date
shall have an Interest Period ending on such date, and (ii) the
remainder (if any) of each such Money Market Absolute Rate Loan shall
have an Interest Period determined as set forth above; and
(c) any Interest Period which would otherwise end after the
Maturity Date shall end on the Maturity Date.
"Internal Revenue Code" means the Internal Revenue Code of
1986, as amended, or any successor statute.
"Investment Grade Rating" means a rating for a Person's senior
long-term unsecured debt, or if no such rating has been issued, a "shadow"
rating, of BBB- or better from S&P, and a rating or "shadow" rating of Baa3 or
better from Moody's or a rating or "shadow" rating equivalent to the foregoing
from either Duff & Phelps or Fitch. Any such "shadow" rating shall be evidenced
by a letter from the applicable Rating Agency or by such other evidence as may
be reasonably acceptable to the Lead Agent (as to any such other evidence, the
Lead Agent shall present the same to, and discuss the same with, the Banks).
"Invitation for Money Market Quotes" has the
meaning set forth in Section 2.3.
"Lead Agent" means Morgan Guaranty Trust Company of New York
in its capacity as Lead Agent for the Banks hereunder, and its successors in
such capacity.
"Letter(s) of Credit" has the meaning provided in Section
2.2(b).
"Letter of Credit Collateral" has the meaning provided in
Section 6.4.
"Letter of Credit Collateral Account" has the meaning provided
in Section 6.4.
19
"Letter of Credit Documents" has the meaning provided in
Section 2.17.
"Letter of Credit Usage" means at any time the sum of (i) the
aggregate maximum amount available to be drawn under the Letters of Credit then
outstanding, assuming compliance with all requirements for drawing referred to
therein, and (ii) the aggregate amount of the Borrowers' unpaid obligations
under this Agreement in respect of the Letters of Credit.
"LIBOR Auction" means a solicitation of Money Market Quotes
setting forth Money Market Margins based on the London Interbank Offered Rate
pursuant to Section 2.3.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind, or any other type
of preferential arrangement that has the practical effect of creating a security
interest, in respect of such asset. For the purposes of this Agreement, each of
the Borrowers or any Subsidiary shall be deemed to own subject to a Lien any
asset which it has acquired or holds subject to the interest of a vendor or
lessor under any conditional sale agreement, capital lease or other title
retention agreement relating to such asset.
"Loan" means a Base Rate Loan, a Euro-Dollar Loan or a Money
Market Loan and "Loans" means Base Rate Loans, Euro-Dollar Loans or Money Market
Loans or any combination of the foregoing.
"Loan Amount" means the aggregate of the Tranche A Loan Amount
and the Tranche B Loan Amount.
"Loan Documents" means this Agreement, the Notes, Letters of
Credit and Letter of Credit Documents.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.7(b).
"Margin Stock" shall have the meaning provided such term in
Regulation U and Regulation G of the Federal Reserve Board.
"Material Adverse Effect" means a material adverse effect upon
(i) the business, operations, properties or assets of either Borrower or (ii)
the ability of either Borrower
20
to perform its obligations hereunder in all material respects, including to pay
interest and principal.
"Material Plan" means at any time a Plan or Plans having
aggregate Unfunded Liabilities in excess of $5,000,000.
"Materials of Environmental Concern" means and includes
pollutants, contaminants, hazardous wastes, toxic and hazardous substances,
petroleum and petroleum by-products.
"Maturity Date" has the meaning set forth in Section 2.9.
"Maximum Total Debt Ratio" means the ratio as of the date of
determination of (i) the sum of (x) the aggregate Debt of the Borrowers and
their Consolidated Subsidiaries and (y) the Borrowers' pro rata share of the
Debt of any Subsidiaries of the Borrowers which are not Consolidated
Subsidiaries, at the time of determination to (ii) the Tangible FMV of the
Borrowers and their Consolidated Subsidiaries.
"Minority Holdings" means partnerships, limited liability
companies and corporations held or owned by either Borrower which are not
consolidated with such Borrower on such Borrower's financial statements, other
than Bond Texas Limited Partnership and Carr Square 225 Associates.
"Money Market Absolute Rate" has the meaning set forth in
Section 2.3(d).
"Money Market Absolute Rate Loan" means a loan to be made by a
Bank pursuant to an Absolute Rate Auction.
"Money Market Lending Office" means, as to each Bank, its
Domestic Lending Office or such other office, branch or affiliate of such Bank
as it may hereafter designate as its Money Market Lending Office by notice to
the Borrower and the Lead Agent; provided that any Bank may from time to time by
notice to the Borrower and the Lead Agent designate separate Money Market
Lending Offices for its Money Market LIBOR Loans, on the one hand, and its Money
Market Absolute Rate Loans, on the other hand, in which case all references
herein to the Money Market Lending Office of
21
such Bank shall be deemed to refer to either or both of such offices, as the
context may require.
"Money Market LIBOR Loan" means a loan to be made by a Bank
pursuant to a LIBOR Auction (including such a loan bearing interest at the Base
Rate pursuant to Section 2.3).
"Money Market Loan" means a Money Market LIBOR Loan or a Money
Market Absolute Rate Loan.
"Money Market Margin" has the meaning set forth in Section
2.3.
"Money Market Quote" means an offer by a Bank to make a Money
Market Loan in accordance with Section 2.3.
"Money Market Quote Request" has the meaning set forth in
Section 2.3.
"Moody's" means Moody's Investors Service, Inc. or any
successor thereto.
"Morgan" means Morgan Guaranty Trust Company of New York, in
its individual capacity.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the ERISA
Group during such five year period.
"Net Offering Proceeds" means all cash or other assets
received by Carr or Carr LP as a result of the sale of common shares of
beneficial interest, preferred shares of beneficial interest, partnership
interests, limited liability company interests, Convertible Securities or other
ownership or equity interests in Carr or Carr LP less customary costs and
discounts of issuance paid by Carr or Carr LP, as the case may be.
"Net Operating Cash Flow" means, as of any date of
determination, with respect to all Real Property Assets and Minority Holdings of
Carr and its Consolidated Subsidiaries, the product of (A) Property Income for
the previous quarter in the case of all Real Property Assets of Carr and
22
its Consolidated Subsidiaries, and Carr's pro rata share in the case of Minority
Holdings, but less (x) Property Expenses (or in the case of Minority Holdings,
Carr's pro rata share thereof) for the previous quarter and (y) the greater of
(i) Capital Expenditures which are not related to new construction for the
previous quarter, and (ii) reserves for such quarter for Capital Expenditures of
$1.50 per square foot per annum for each Real Property Asset, and (B) four (4).
"Net Operating Income" means as of any date of determination
with respect to any Real Property Asset, the product of (A) Property Income for
the previous quarter, but less Property Expenses for the previous quarter and
(B) four (4).
"New Acquisition" has the meaning set forth in Section 5.15.
"Non-Recourse Debt" means Debt of either Borrower on a
consolidated basis for which the right of recovery of the obligee thereof is
limited to recourse against the Real Property Assets securing such Debt (subject
to such limited exceptions to the non-recourse nature of such Debt such as
fraud, misappropriation, misapplication and environmental indemnities, as are
usual and customary in like transactions at the time of the incurrence of such
Debt).
"Notes" means collectively, the Tranche A Notes, the Tranche B
Notes, and any Designated Lender Notes.
"Notice of Borrowing" means a Notice of Committed Borrowing
(as defined in Section 2.2 and 2.3) or a Notice of Money Market Borrowing (as
defined in Section 2.3(f)).
"Notice of Interest Rate Election" has the meaning set forth
in Section 2.15 hereof.
"Obligations" means all obligations, liabilities and
indebtedness of every nature of the Borrowers or CarrAmerica LP, from time to
time owing to any Bank under or in connection with this Agreement or any other
Loan Document, including, without limitation, (i) the outstanding principal
amount of the Committed Loans at such time, plus (ii) the Letter of Credit Usage
at such time, plus (iii) the outstanding principal amount of any Money Market
Loans at such time.
23
"Outstanding Balance" means the sum of (i) the aggregate
outstanding and unpaid principal balance of all Loans and (ii) the Letter of
Credit Usage.
"Parent" means, with respect to any Bank, any Person
controlling such Bank.
"Participant" has the meaning set forth in Section 9.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Liens" means (a) Liens in favor of either or both
of the Borrowers or CarrAmerica LP on all or any part of the assets of
Subsidiaries of either Borrower or CarrAmerica LP, provided that (i) such
Subsidiary shall be a co-maker of the Tranche A Notes or Tranche B Notes, as
applicable, (ii) the Debt to which such Lien relates is held by a Borrower or
CarrAmerica LP, (iii) such Debt is not otherwise pledged or encumbered and (iv)
no more than 25% of the Unencumbered Asset Pool Properties Value may be subject
to any such Liens; (b) Liens to secure the performance of statutory obligations,
surety or appeal bonds, performance bonds, completion bonds, government
contracts or other obligations of a like nature, including Liens in connection
with workers' compensation, unemployment insurance and other types of statutory
obligations or to secure the performance of tenders, bids, leases, contracts
(other than for the repayment of Debt) and other similar obligations incurred in
the ordinary course of business; (c) Liens for taxes, assessments or
governmental charges or claims that are not yet delinquent or that are being
contested in good faith by appropriate proceedings promptly instituted and
diligently concluded; provided, that any reserve or other appropriate provision
as shall be required in conformity with GAAP shall have been made therefor; (d)
Liens on property of either Borrower or any Subsidiary thereof in favor of the
Federal or any state government to secure certain payments pursuant to any
contract, statute or regulation; (e) easements (including, without limitation,
reciprocal easement agreements and utility agreements), rights of way,
covenants, consents, reservations, encroachments, variations and zoning and
other restrictions, charges or encumbrances (whether or not recorded), which do
not interfere materially with the ordinary conduct of the business of the
applicable Borrower or any
24
Subsidiary thereof and which do not materially detract from the value of the
property to which they attach or materially impair the use thereof by the
applicable Borrower or Subsidiary; (f) statutory Liens of carriers,
warehousemen, mechanics, suppliers, materialmen, repairmen or other Liens
imposed by law and arising in the ordinary course of business, for sums not then
due and payable (or which, if due and payable are being contested in good faith
and with respect to which adequate reserves are being maintained to the extent
required by GAAP); (g) Liens not otherwise permitted by this definition and
incurred in the ordinary course of business of either or both of the Borrowers
or any Subsidiary with respect to obligations which do not exceed $2,000,000 in
principal amount in the aggregate at any one time outstanding; (h) Liens
existing on the date of this Agreement which have been disclosed on Schedule
4.28; (i) the interests of lessees and lessors under leases of real or personal
property made in the ordinary course of business which would not have a material
adverse effect on the Borrowers and their Subsidiaries taken as a whole; and (j)
judgment and attachment Liens not giving rise to an Event of Default.
"Permitted LTV Ratio" means, with respect to the Borrowers'
LTV Ratio, the Carr LTV Ratio and the Carr LP LTV Ratio, a ratio, expressed as a
percentage, which is 50% or lower.
"Person" means an individual, a corporation, a limited
liability company, a partnership, an association, a trust or any other entity or
organization, including a government or political subdivision or an agency or
instrumentality thereof.
"Plan" means at any time an employee pension benefit plan
(other than a Multiemployer Plan) which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code and either (i) is maintained, or contributed to, by any member of
the ERISA Group for employees of any member of the ERISA Group or (ii) has at
any time within the preceding
25
five years been maintained, or contributed to, by any Person which was at such
time a member of the ERISA Group for employees of any Person which was at such
time a member of the ERISA Group.
"Prime Rate" means the rate of interest publicly announced by
Morgan Guaranty Trust Company of New York in New York City from time to time as
its Prime Rate.
"Pro-Forma Debt Service" means the amount determined by
applying a 25 year mortgage style amortization schedule to all Unsecured Debt of
the Borrowers, CarrAmerica LP and their Consolidated Subsidiaries and their pro
rata share of all Unsecured Debt of Subsidiaries that are not Consolidated
Subsidiaries outstanding as of the last day of each calendar quarter, using an
interest rate equal to the greater of (i) the Treasury Rate plus 1.75%, and (ii)
the actual rate of interest in effect with respect to such Unsecured Debt as of
the last day of such quarter, all determined on an annualized basis.
"Property Expenses" means, when used with respect to any Real
Property Asset, the costs of maintaining and operating such Real Property Asset,
calculated in accordance with GAAP, which are the responsibility of the owner
thereof and that are not paid directly by the tenant thereof, including, without
limitation, real estate taxes, insurance, repairs and maintenance, but provided
that if such tenant is more than 60 days in arrears in the payment of base or
fixed rent, then such costs will also constitute "Property Expenses", but
excluding depreciation, amortization and interest costs.
"Property Income" means, when used with respect to any Real
Property Asset, rents and other revenues earned in accordance with GAAP, in the
ordinary course therefrom, including, without limitation, revenues from any
parking leases and lease termination fees amortized over the remaining term of
the lease for which such termination fee was received (other than the paid rents
and revenues and security deposits except to the extent applied in satisfaction
of tenants' obligations for rent).
"Rating Agencies" means, collectively, S&P, Moody's, Duff &
Phelps and Fitch.
26
"Real Property Assets" means as of any time, the real property
assets (including interests in participating mortgages in which either
Borrower's interest therein is characterized as equity according to GAAP) owned
directly or indirectly by either Borrower at such time.
"Recourse Debt" shall mean Debt of the Borrower or any
Consolidated Subsidiary that is not Non-Recourse Debt.
"Reference Bank" means the principal London offices of Morgan
Guaranty Trust Company of New York.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Required Banks" means at any time Banks having at least 51%
of the aggregate amount of the Commitments or, if the Commitments shall have
been terminated, holding Notes evidencing at least 51% of the aggregate unpaid
principal amount of the Loans.
"Solvent" means, with respect to any Person, that the fair
saleable value of such Person's assets exceeds the Debts of such Person.
"S&P" means Standard & Poor's Ratings Group, or any successor
thereto.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests representing either (i) ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions or (ii) a majority of the economic interest therein, are at
the time directly or indirectly owned by Carr or Carr LP.
"Tangible FMV" means the aggregate of (i) Carr Tangible FMV
and (ii) Carr LP Tangible FMV.
"Term" has the meaning set forth in Section 2.9.
"Third Amendment" has the meaning set forth in
Section 5.4.
"Tranche A Commitment" means, with respect to each Bank, the
amount committed by such Bank pursuant to this
27
Agreement with respect to any Tranche A Loans, as such amount may be reduced
from time to time pursuant to Sections 2.10 and 2.11.
"Tranche A Loan" means the loan or loans to be made to Carr
and CarrAmerica LP for the purposes set forth in Section 5.15 hereof which loan
or loans shall be a Base Rate Loan or Loans, a Euro-Dollar Loan or Loans, or a
Money Market Loan or Loans.
"Tranche A Loan Amount" has the meaning set forth in Section
2.1.
"Tranche A Notes" means the promissory notes of Carr and
CarrAmerica LP, each substantially in the form of Exhibits A-1 or A-3 hereto,
evidencing the joint and several obligation of Carr and CarrAmerica LP to repay
the Tranche A Loans, and "Tranche A Note" means any one of such promissory notes
issued hereunder.
"Tranche B Commitment" means, with respect to each Bank, the
amount committed by such Bank pursuant to this Agreement with respect to any
Tranche B Loans, as such amount may be reduced from time to time pursuant to
Sections 2.10 and 2.11.
"Tranche B Loan" means the loan or loans to be made to Carr LP
and Carr for the purposes set forth in Section 5.15 hereof which loan or loans
shall be a Base Rate Loan or Loans, a Euro-Dollar Loan or Loans, or a Money
Market Loan or Loans.
"Tranche B Loan Amount" has the meaning set forth in Section
2.1.
"Tranche B Notes" means the promissory notes of Carr LP and
Carr, each substantially in the form of Exhibits A-2 or A-4 hereto, evidencing
the joint and several obligation of Carr LP and Carr to repay the Tranche B
Loans, and "Tranche B Note" means any one of such promissory notes issued
hereunder.
"Treasury Rate" means, as of any date, a rate equal to the
annual yield to maturity on the U.S. Treasury Constant Maturity Series with a
ten year maturity, as such yield is reported in Federal Reserve Statistical
Release H.15 -- Selected Interest Rates, published most recently
28
prior to the date the applicable Treasury Rate is being determined. Such yield
shall be determined by straight line linear interpolation between the yields
reported in Release H.15, if necessary. In the event Release H.15 is no longer
published, the Lead Agent shall select, in its reasonable discretion, an
alternate basis for the determination of Treasury yield for U.S. Treasury
Constant Maturity Series with ten year maturities.
"Unencumbered Asset Pool Net Operating Cash Flow" means as of
any date of determination with respect to the Unencumbered Asset Pool
Properties, the product of (A) Property Income with respect to the Unencumbered
Assets for the previous quarter, but less (x) Property Expenses with respect to
the Unencumbered Asset Pool Properties for the previous quarter and (y) the
greater of (i) Capital Expenditures which are not related to new construction
for the previous quarter and (ii) reserves for such quarter for Capital
Expenditures of $1.50 per square foot per annum for each Unencumbered Asset Pool
Property, and (B) four (4). For purposes of Section 5.1(m) hereof, the
calculation of Unencumbered Asset Pool Net Operating Cash Flow shall be made
separately as to each Unencumbered Asset Pool Property.
"Unencumbered Asset Pool Properties" means, as of any date,
collectively the Carr Unencumbered Asset Pool Properties and the Carr LP
Unencumbered Asset Pool Properties.
"Unencumbered Asset Pool Minimum Debt Service
Coverage" means as of the last day of each calendar quarter, Unencumbered Asset
Pool Net Operating Cash Flow equal to or greater than 200% of Pro-Forma Debt
Service.
"Unencumbered Asset Pool Properties Value" means the aggregate
of (i) the Carr Unencumbered Asset Pool Properties Value and (ii) the Carr LP
Unencumbered Asset Pool Properties Value.
"Unfunded Liabilities" means, with respect to any Plan at any
time, the amount (if any) by which (i) the value of all benefit liabilities
under such Plan, determined on a plan termination basis using the assumptions
prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the
fair market value of all Plan assets allocable to such liabilities under Title
IV of ERISA (excluding any accrued but unpaid contributions), all determined as
of the then
29
most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including
the States and the District of Columbia, but excluding its territories and
possessions.
"Unsecured Debt" means all Debt which is not secured by a
Lien.
"Unused Commitments" means an amount equal to all unadvanced
funds (other than unadvanced funds in connection with any construction loan)
which any third party is obligated to advance to either of the Borrowers or
otherwise, pursuant to any loan document, written instrument or otherwise.
SECTION 1.2. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with generally accepted accounting principles as in effect from time
to time, applied on a basis consistent (except for changes concurred in by the
Borrowers' independent public accountants) with the most recent audited
consolidated financial statements of Carr delivered to the Lead Agent and the
Banks; provided that, if Carr notifies the Lead Agent and the Banks that Carr
wishes to amend any covenant in Article V to eliminate the effect of any change
in generally accepted accounting principles on the operation of such covenant
(or if the Lead Agent notifies Carr that the Required Banks wish to amend
Article V for such purpose), then Carr's compliance with such covenant shall be
determined on the basis of generally accepted accounting principles in effect
immediately before the relevant change in generally accepted accounting
principles became effective, until either such notice is withdrawn or such
covenant is amended in a manner satisfactory to Carr and the Required Banks.
SECTION 1.3. Types of Borrowings. The term "Borrowing" denotes
the aggregation of Loans of one or more Banks to be made to the Borrowers
pursuant to Article II on a single date and for a single Interest Period.
Borrowings
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are classified for purposes of this Agreement either by reference to the pricing
of Loans comprising such Borrowing (e.g., a "Euro-Dollar Borrowing" is a
Borrowing comprised of Euro-Dollar Loans) or by reference to the provisions of
Article II under which participation therein is determined (i.e., a "Committed
Borrowing" is a Borrowing under Section 2.1 in which all Banks participate in
proportion to their Commitments, while a "Money Market Borrowing" is a Borrowing
under Section 2.3.
ARTICLE II
THE CREDITS
SECTION 2.1. Commitments to Lend. Each Bank severally agrees,
on the terms and conditions set forth in this Agreement, to make the Tranche A
Loans to Carr and CarrAmerica LP and participate in Letters of Credit issued by
the Fronting Bank on behalf of Carr or CarrAmerica LP pursuant to this Section
from time to time, but, together with the Tranche B Loans, not more frequently
than four times monthly, during the Term in amounts such that the aggregate
principal amount of Tranche A Loans by such Bank at any one time outstanding
together with such Bank's pro rata share of Letter of Credit Usage with respect
to Carr and CarrAmerica LP shall not exceed the amount of its Tranche A
Commitment. The aggregate amount of Tranche A Loans to be made hereunder
together with the Letter of Credit Usage with respect to Carr and CarrAmerica
LP, shall not exceed Three Hundred Seventy-Six Million Dollars ($376,000,000)
(the "Tranche A Loan Amount"). Each Bank severally agrees, on the terms and
conditions set forth in this Agreement, to make the Tranche B Loans to Carr LP
and Carr and participate in Letters of Credit issued by the Fronting Bank on
behalf of Carr LP pursuant to this Section from time to time, but, together with
the Tranche A Loans, not more frequently than four times monthly, during the
Term in amounts such that the aggregate principal amount of Tranche B Loans by
such Bank at any one time outstanding, together with such Bank's pro rata share
of Letter of Credit Usage with respect to Carr LP, shall not exceed the amount
of its Tranche B Commitment. The aggregate amount of Tranche B Loans to be made
hereunder, together with the Letter of Credit Usage with respect to Carr LP,
shall not exceed Seventy-Four Million Dollars ($74,000,000) (the "Tranche B Loan
Amount"). Each Borrowing under this subsection
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(a) shall be in an aggregate principal amount of at least $2,500,000, or an
integral multiple of $1,000,000 in excess thereof (except that any such
Borrowing may be in the aggregate amount available in accordance with Section
3.2(c)) and shall be made from the several Banks ratably in proportion to their
respective Commitments. Subject to the limitations set forth herein, any amounts
repaid may be reborrowed. Notwithstanding anything to the contrary, the number
of new Borrowings shall be limited to four Borrowings per month and no more than
ten Borrowings shall be outstanding at any time.
SECTION 2.2. Notice of Committed Borrowing. (a) The applicable
Borrower or CarrAmerica LP, as the case may be, shall give the Lead Agent notice
(a "Notice of Committed Borrowing") not later than 10:00 a.m. (New York City
time) (x) one Domestic Business Day before each Base Rate Borrowing or (y) the
third Euro-Dollar Business Day before each Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a
Domestic Business Day in the case of a Domestic Borrowing or a
Euro-Dollar Business Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Borrowing,
(iii) whether the Loans comprising such Borrowing are
to be Base Rate Loans or Euro-Dollar Loans, and
(iv) in the case of a Euro-Dollar Borrowing, the
duration of the Interest Period applicable thereto, subject to the
provisions of the definition of Interest Period.
(b) Either Borrower or CarrAmerica LP shall give the Lead
Agent, and the designated Fronting Bank, written notice in the event that it
desires to have Letters of Credit (each, a "Letter of Credit") issued hereunder
no later than 10:00 a.m., New York City time, at least four (4) Domestic
Business Days prior to the date of such issuance. Each such notice shall specify
(i) the designated Fronting Bank, (ii) the aggregate amount of the requested
Letters of Credit, (iii) the individual amount of each requested Letter of
Credit and the number of Letters of Credit to be issued,
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(iv) the date of such issuance (which shall be a Domestic Business Day), (v) the
name and address of the beneficiary, (vi) the expiration date of the Letter of
Credit (which in no event shall be later than twelve (12) months after the
issuance of such Letter of Credit or the Maturity Date, whichever is earlier),
(vii) the purpose and circumstances for which such Letter of Credit is being
issued, (viii) the terms upon which each such Letter of Credit may be drawn down
(which terms shall not leave any discretion to Fronting Bank), and (ix) whether
such Letters of Credit shall be attributable to Tranche A Loan Amount or Tranche
B Loan Amount. Each such notice may be revoked telephonically by the applicable
Borrower or CarrAmerica LP, as the case may be, to the applicable Fronting Bank
and the Lead Agent any time prior to the date of issuance of the Letter of
Credit by the applicable Fronting Bank, provided such revocation is confirmed in
writing by such Borrower or CarrAmerica LP to the Fronting Bank and the Lead
Agent within one (1) Domestic Business Day by facsimile. No later than 10:00
a.m., New York City time, on the date that is four (4) Domestic Business Days
prior to the date of issuance, the applicable Borrower or CarrAmerica LP shall
specify a precise description of the documents and the verbatim text of any
certificate to be presented by the beneficiary of such Letter of Credit, which
if presented by such beneficiary prior to the expiration date of the Letter of
Credit would require the Fronting Bank to make a payment under the Letter of
Credit; provided that Fronting Bank may, in its reasonable judgment, require
changes in any such documents and certificates only in conformity with changes
in customary and commercially reasonable practice or law and provided further,
that no Letter of Credit shall require payment against a conforming draft to be
made thereunder on the following Domestic Business Day that such draft is
presented if such presentation is made later than 10:00 A.M. New York City time
(except that if the beneficiary of any Letter of Credit requests at the time of
the issuance of its Letter of Credit that payment be made on the same Domestic
Business Day against a conforming draft, such beneficiary shall be entitled to
such a same day draw, provided such draft is presented to the applicable
Fronting Bank no later than 10:00 A.M. New York City time and provided further
that, prior to the issuance of such Letter of Credit, such Borrower or
CarrAmerica LP shall have requested to Fronting Bank and the Lead Agent that
such beneficiary shall be entitled to a same day draw). In determining whether
to pay on such Letter of Credit, the Fronting Bank shall be responsible only to
determine that
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the documents and certificates required to be delivered under the Letter of
Credit have been delivered and that they comply on their face with the
requirements of that Letter of Credit.
SECTION 2.3. Money Market Borrowings.
The Money Market Option. In addition to Committed Borrowings
pursuant to Section 2.1 and Section 2.2 hereof, the applicable Borrower or
CarrAmerica LP, as the case may be, may, as set forth in this Section, request
the Banks at any time or from time to time during the Term to make offers to
make Money Market Loans to such Borrower or CarrAmerica LP, as the case may be,
not to exceed $225,000,000 in the aggregate outstanding at any one time. The
Banks may, but shall have no obligation to, make such offers and the applicable
Borrower or CarrAmerica LP, as the case may be, may, but shall have no
obligation to, accept any such offers in the manner set forth in this Section.
Money Market Quote Request. When the applicable Borrower or
CarrAmerica LP, as the case may be, wishes to request offers to make Money
Market Loans under this Section, it shall transmit to the Lead Agent by telex or
facsimile transmission a request for Money Market Quotes substantially in the
form of Exhibit D hereto (a "Money Market Quote Request") so as to be received
not later than 10:30 A.M. (New York City time) on (x) the fourth Euro-Dollar
Business Day prior to the date of Borrowing proposed therein, in the case of a
LIBOR Auction or (y) the Domestic Business Day next preceding the date of
Borrowing proposed therein, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrowers and the Lead Agent shall
have mutually agreed and shall have notified to the Banks not later than the
date of the Money Market Quote Request for the first LIBOR Auction or Absolute
Rate Auction for which such change is to be effective) specifying:
(i) the proposed date of Borrowing, which shall be a
Euro-Dollar Business Day in the case of a LIBOR Auction or a Domestic
Business Day in the case of an Absolute Rate Auction,
(ii) the aggregate amount of such Borrowing, which shall be
$10,000,000 or a larger multiple of $500,000,
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(iii) the duration of the Interest Period applicable thereto,
subject to the provisions of the definition of Interest Period,
(iv) whether the Money Market Quotes requested are to set
forth a Money Market Margin or a Money Market Absolute Rate,
(v) whether the Money Market Loan will consist in full or in
part of the Tranche A Loan and/or the Tranche B Loan, and if consisting
in part of each, the portions consisting of Tranche A Loans and Tranche
B Loans, and
(vi) whether a Bank may designate a Designated Lender in
connection with such Money Market Loan.
The applicable Borrower or CarrAmerica LP, as the case may be, may request
offers to make Money Market Loans for more than one Interest Period in a single
Money Market Quote Request. No Money Market Quote Request shall be given within
five Euro-Dollar Business Days (or such other number of days as the Borrowers
and the Lead Agent may agree) of any other Money Market Quote Request.
(c) Invitation for Money Market Quotes. Promptly upon receipt
of a Money Market Quote Request, but no later than 1:00 p.m. (New York City
time) on (i) the fourth Euro-Dollar Business Day prior to the proposed date of
Borrowing, or (ii) the Domestic Business next preceding the date of the proposed
Borrowing, the Lead Agent shall send to the Banks by telex or facsimile
transmission an Invitation for Money Market Quotes substantially in the form of
Exhibit E hereto (an "Invitation for Money Market Quotes"), which shall
constitute an invitation by the applicable Borrower or CarrAmerica LP, as the
case may be, to each Bank to submit Money Market Quotes offering to make the
Money Market Loans to which such Money Market Quote Request relates in
accordance with this Section.
(d) Submission and Contents of Money Market Quotes. (i) Each
Bank may submit a Money Market Quote containing an offer or offers to make Money
Market Loans in response to any Invitation for Money Market Quotes. Each Money
Market Quote must comply with the requirements of this subsection (d) and must
be submitted to the Lead Agent by telex or facsimile transmission at its offices
specified in
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or pursuant to Section 9.1 not later than (x) 10:00 A.M. (New York City time) on
the third Euro-Dollar Business Day prior to the proposed date of Borrowing, in
the case of a LIBOR Auction or (y) 10:00 A.M. (New York City time) on the
proposed date of Borrowing, in the case of an Absolute Rate Auction (or, in
either case, such other time or date as the Borrowers and the Lead Agent shall
have mutually agreed and shall have notified to the Banks not later than the
date of the Money Market Quote Request for the first LIBOR Auction or Absolute
Rate Auction for which such change is to be effective); provided that Money
Market Quotes submitted by the Lead Agent (or any affiliate of the Lead Agent)
in its capacity of a Bank may be submitted, and may only be submitted, if the
Lead Agent or such affiliate notifies the applicable Borrower or CarrAmerica LP,
as the case may be, of the terms of the offer or offers contained therein not
later than thirty (30) minutes prior to the applicable deadline for the other
Banks. Subject to Articles III and VI, any Money Market Quote so made shall be
irrevocable except with the written consent of the Lead Agent given on the
instructions of the applicable Borrower or CarrAmerica LP, as the case may be.
If, and only if, the applicable Borrower or CarrAmerica LP, as the case may be,
elected in the applicable Money Market Quote Request to permit the Banks to
designate Designated Lenders to fund such Money Market Loans, such Money Market
Loans may be funded by such Bank's Designated Lender (if any) as provided in
Section 9.6(d), however such Bank shall not be required to specify in its Money
Market Quote whether such Money Market Loans will be funded by such Designated
Lender.
(ii) Each Money Market Quote shall be in substantially the
form of Exhibit F hereto and shall in any case specify:
(1) the proposed date of Borrowing,
(2) the principal amount of the Money Market Loan for which
each such offer is being made, which principal amount (w) may be
greater than or less than the Commitment of the quoting Bank, (x) must
be $5,000,000 or a larger multiple of $500,000, (y) may not exceed the
principal amount of Money Market Loans for which offers were requested
and (z) may be subject to an aggregate limitation as to the principal
amount of Money Market Loans for which offers being made by such
quoting Bank may be accepted,
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(3) in the case of a LIBOR Auction, the margin above or below
the applicable London Interbank Offered Rate (the "Money Market
Margin") offered for each such Money Market Loan, expressed as a
percentage (specified to the nearest 1/10,000th of 1%) to be added to
or subtracted from the applicable London Interbank Offered Rate,
(4) in the case of an Absolute Rate Auction, the rate of
interest per annum (specified to the nearest 1/10,000th of 1%) (the
"Money Market Absolute Rate") offered for each such Money Market Loan,
and
(5) the identity of the quoting Bank.
A Money Market Quote may set forth up to five separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Money Market Quotes.
(iii) Any Money Market Quote shall be disregarded if it:
(1) is not substantially in conformity with Exhibit F
hereto or does not specify all of the information required by
subsection (d)(ii) above;
(2) contains qualifying, conditional or similar
language;
(3) proposes terms other than or in addition to
those set forth in the applicable Invitation for
Money Market Quotes; or
(4) arrives after the time set forth in subsection (d)(i).
(e) Notice to Borrower. The Lead Agent shall promptly notify
the applicable Borrower or CarrAmerica LP, as the case may be, (x) with respect
to each Money Market Quote submitted in accordance with subsection (d), of the
terms of such Money Market Quote and the identity of the Bank submitting such
Money Market Quote and (y) of any Money Market Quote that amends, modifies or is
otherwise inconsistent with a previous Money Market Quote submitted by such Bank
with respect to the same Money Market Quote Request. Any such subsequent Money
Market Quote shall be disregarded
37
by the Lead Agent unless such subsequent Money Market Quote is submitted solely
to correct a manifest error in such former Money Market Quote. The Lead Agent's
notice to the applicable Borrower or CarrAmerica LP, as the case may be, shall
specify (A) the aggregate principal amount of Money Market Loans for which Money
Market Quotes have been received for each Interest Period specified in the
related Money Market Quote Request, (B) the respective principal amounts and
Money Market Margins or Money Market Absolute Rates, as the case may be, so
offered and (C) if applicable, limitations on the aggregate principal amount of
Money Market Loans for which offers in any single Money Market Quote may be
accepted.
(f) Acceptance and Notice by Borrower. Not later than 12:00
noon (New York City time) on (x) the third Euro-Dollar Business Day prior to the
proposed date of Borrowing, in the case of a LIBOR Auction or (y) the proposed
date of Borrowing, in the case of an Absolute Rate Auction (or, in either case,
such other time or date as the Borrowers and the Lead Agent shall have mutually
agreed and shall have notified the Banks not later than the date of the Money
Market Quote Request for the first LIBOR Auction or Absolute Rate Auction for
which such change is to be effective), the applicable Borrower, or CarrAmerica
LP, as the case may be, shall notify the Lead Agent of its acceptance or
non-acceptance of the Money Market Quotes specified in the Lead Agent's notice
to the applicable Borrower or CarrAmerica LP, as the case may be, pursuant to
subsection (e). In the case of acceptance, such notice (a "Notice of Money
Market Borrowing") shall specify the aggregate principal amount of offers for
each Interest Period that are accepted and shall specify whether such offer is
to be allocated to Tranche A or Tranche B. The applicable Borrower or
CarrAmerica LP, as the case may be, may accept any Money Market Quote in whole
or in part; provided that:
(i) the aggregate principal amount of each Money Market
Borrowing may not exceed the applicable amount set forth in the related
Money Market Quote Request;
(ii) the principal amount of each Money Market Borrowing must
be $10,000,000 or a larger multiple of $500,000;
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(iii) acceptance of offers may only be made on the basis of
ascending Money Market Margins or Money Market Absolute Rates, as the
case may be; and
(iv) the applicable Borrower or CarrAmerica LP, as the case
may be, may not accept any Money Market Quote that is described in
subsection (d)(iii) or that otherwise fails to comply with the
requirements of this Agreement.
For the purposes of Section 2.1 hereof, all Money Market Loans
made on the same date of Borrowing for the same Interest Period shall constitute
a single Borrowing.
(g) Allocation by Lead Agent. If Money Market Quotes are made
by two or more Banks with the same Money Market Margins or Money Market Absolute
Rates, as the case may be, for a greater aggregate principal amount than the
amount in respect of which such Money Market Quotes are accepted for the related
Interest Period, the principal amount of Money Market Loans in respect of which
such Money Market Quotes are accepted shall be allocated by the Lead Agent among
such Banks as nearly as possible (in multiples of $500,000, as the Lead Agent
may deem appropriate) in proportion to the aggregate principal amounts of such
Money Market Quotes. Determinations by the Lead Agent of the amounts of Money
Market Loans shall be conclusive in the absence of manifest error.
(h) Notification by Lead Agent. Upon receipt of a Notice of
Money Market Borrowing in accordance with Section 2.3(f) hereof, the Lead Agent
shall, on the date such Notice of Money Market Borrowing is received by the Lead
Agent, notify each Bank of the principal amount of the Money Market Borrowing
accepted by the applicable Borrower or CarrAmerica LP, as the case may be, and
of such Bank's share (if any) of such Money Market Borrowing and such Notice of
Money Market Borrowing shall not thereafter be revocable by the applicable
Borrower or CarrAmerica LP, as the case may be. Provided that the applicable
Borrower or CarrAmerica LP, as the case may be, elected in the applicable Money
Market Quote Request to permit the Banks to designate Designated Lenders to fund
such Money Market Loans, a Bank who is notified that it has been selected to
make a Money Market Loan may designate its Designated Lender (if any) to fund
such Money Market Loan on its behalf, as described in Section 9.6(d). Any
Designated Lender which
39
funds a Money Market Loan shall on and after the time of such funding become the
obligee under such Money Market Loan and be entitled to receive payment thereof
when due. No Bank shall be relieved of its obligation to fund a Money Market
Loan, and no Designated Lender shall assume such obligation, prior to the time
the applicable Money Market Loan is funded.
SECTION 2.4. Notice to Banks; Funding of Loans.
(a) Upon receipt of a Notice of Committed Borrowing, the
Lead Agent shall notify each Bank on the same day as it receives such Notice of
Committed Borrowing of the contents thereof and of such Bank's share of such
Borrowing and such Notice of Committed Borrowing shall not thereafter be
revocable by the applicable Borrower or CarrAmerica LP.
(b) Not later than 2:00 P.M. (New York City time) on the
date of each Committed Borrowing as indicated in the Notice of Committed
Borrowing, each Bank shall (except as provided in subsection (c) of this
Section) make available its share of such Borrowing, in Federal or other funds
immediately available in New York City, to the Lead Agent at its address
referred to in Section 9.1. The Lead Agent will make the funds so received from
the Banks available to the applicable Borrower or CarrAmerica LP, as applicable,
at the Lead Agent's aforesaid address. If a Borrower or CarrAmerica LP has
requested the issuance of a Letter of Credit, no later than 12:00 Noon (New York
City time) on the date of such issuance as indicated in the Notice of Committed
Borrowing, the Fronting Bank shall issue such Letter of Credit in the amount so
requested and deliver the same to the applicable Borrower or CarrAmerica LP with
a copy thereof to the Lead Agent. Immediately upon the issuance of each Letter
of Credit by the Fronting Bank, such Fronting Bank shall be deemed to have sold
and transferred to each other Bank, and each such other Bank shall be deemed to,
and hereby agrees to, have irrevocably and unconditionally purchased and
received from Fronting Bank, without recourse or warranty, an undivided interest
and a participation in such Letter of Credit, any drawing thereunder, and the
obligations of the applicable Borrower or CarrAmerica LP hereunder with respect
thereto, and any security therefor or guaranty pertaining thereto, in an amount
equal to such Bank's ratable share thereof (based upon the ratio its Commitment
bears to the aggregate of all Commitments). Upon any change in any of the
Commitments in accordance herewith,
40
there shall be an automatic adjustment to such participations to reflect such
changed shares. The Fronting Bank shall have the primary obligation to fund any
and all draws made with respect to such Letter of Credit notwithstanding any
failure of a participating Bank to fund its ratable share of any such draw. The
Lead Agent will instruct the Fronting Bank to make such Letter of Credit
available to such Borrower and the Fronting Bank shall make such Letter of
Credit available to the applicable Borrower or CarrAmerica LP at the applicable
Borrower's or CarrAmerica's LP aforesaid address on the date of the Borrowing.
(c) Unless the Lead Agent shall have received notice from
a Bank prior to the date of any Borrowing that such Bank will not make available
to the Lead Agent such Bank's share of such Borrowing, the Lead Agent may assume
that such Bank has made such share available to the Lead Agent on the date of
such Borrowing in accordance with subsection (b) of this Section 2.4 and the
Lead Agent may, in reliance upon such assumption, make available to the
applicable Borrower or CarrAmerica LP, as applicable, on such date a
corresponding amount. If and to the extent that such Bank shall not have so made
such share available to the Lead Agent, such Bank and the applicable Borrower or
CarrAmerica LP severally agree to repay to the Lead Agent forthwith on demand
such corresponding amount together with interest thereon, for each day from the
date such amount is made available to the applicable Borrower or CarrAmerica LP
until the date such amount is repaid to the Lead Agent, at (i) in the case of
either Borrower or CarrAmerica LP, a rate per annum equal to the higher of the
Federal Funds Rate and the interest rate applicable thereto pursuant to Section
2.7 and (ii) in the case of such Bank, the Federal Funds Rate. If such Bank
shall repay to the Lead Agent such corresponding amount, such amount so repaid
shall constitute such Bank's Loan included in such Borrowing for purposes of
this Agreement.
SECTION 2.5. Notes.
(a) The Tranche A Loans shall be evidenced by
the Tranche A Notes, each of which shall be payable to the order of each Bank
for the account of its Applicable Lending Office in an amount equal to each such
Bank's Tranche A Commitment.
41
(b) The Tranche B Loans shall be evidenced by the Tranche
B Notes, each of which shall be payable to the order of each Bank for the
account of its Applicable Lending Office in an amount equal to each such Bank's
Tranche B Commitment.
(c) Each Bank may, by notice to the Borrowers and
CarrAmerica LP and the Lead Agent, request that its Loans of a particular type
be evidenced by a separate Note in an amount equal to the aggregate unpaid
principal amount of such Loans. Each such Note shall be in substantially the
form of Exhibit A-1 or Exhibit A-2 hereto, as applicable, with appropriate
modifications to reflect the fact that it evidences solely Loans of the relevant
type. Each reference in this Agreement to the "Note" of such Bank shall be
deemed to refer to and include any or all of such Notes, as the context may
require.
(d) Upon receipt of each Bank's Note pursuant to Section
3.1(a) or (b), the Lead Agent shall forward such Note to such Bank. Each Bank
shall record the date, amount, type and maturity of each Loan made by it and the
date and amount of each payment of principal made by either Borrower or
CarrAmerica LP with respect thereto, and may, if such Bank so elects in
connection with any transfer or enforcement of its Note, endorse on the schedule
forming a part thereof appropriate notations to evidence the foregoing
information with respect to each such Loan then outstanding; provided that the
failure of any Bank to make any such recordation or endorsement shall not affect
the obligations of the Borrowers hereunder or under the Notes. Each Bank is
hereby irrevocably authorized by the Borrowers and CarrAmerica LP so to endorse
its Note and to attach to and make a part of its Note a continuation of any such
schedule as and when required.
(e) There shall be no more than ten (10) Euro-Dollar
Borrowings outstanding at any one time pursuant to this Agreement.
SECTION 2.6. Maturity of Loans. The Loans shall mature,
and the principal amount thereof shall be due and payable, on the Maturity Date.
SECTION 2.7. Interest Rates.
42
(a) Each Base Rate Loan shall bear interest on the
outstanding principal amount thereof, for each day from the date such Loan is
made until it becomes due, at a rate per annum equal to the sum of the
Applicable Margin for Base Rate Loans for such day plus the Base Rate for such
day. Such interest shall be payable for each Interest Period on the last day
thereof.
(b) Each Euro-Dollar Loan shall bear interest on the
outstanding principal amount thereof, for each day during the Interest Period
applicable thereto, at a rate per annum equal to the sum of the Applicable
Margin for Euro-Dollar Loans for such day plus the Adjusted London Interbank
Offered Rate applicable to such Interest Period. Such interest shall be payable
for each Interest Period on the last day thereof and, if such Interest Period is
longer than three months, at intervals of three months after the first day
thereof.
"Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained (rounded
upward, if necessary, to the next higher 1/100 of 1%) by dividing (i) the
applicable London Interbank Offered Rate by (ii) 1.00 minus the Euro-Dollar
Reserve Percentage.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System in New York City with deposits exceeding five billion
dollars in respect of "Eurocurrency liabilities" (or in respect of any other
category of liabilities which includes deposits by reference to which the
interest rate on Euro-Dollar Loans is determined or any category of extensions
of credit or other assets which includes loans by a non-United States office of
any Bank to United States residents). The Adjusted London Interbank Offered Rate
shall be adjusted automatically on and as of the effective date of any change in
the Euro-Dollar Reserve Percentage.
"London Interbank Offered Rate" applicable to any Interest
Period means the average (rounded upward, if necessary, to the next higher 1/16
of 1%) of the respective rates per annum at which deposits in dollars are
offered to
43
the Reference Bank in the London interbank market at approximately 11:00 a.m.
(London time) two Euro-Dollar Business Days before the first day of such
Interest Period in an amount approximately equal to the principal amount of the
Euro-Dollar Loan of such Reference Bank to which such Interest Period is to
apply and for a period of time comparable to such Interest Period.
(c) Subject to Section 8.1, each Money Market LIBOR Loan
shall bear interest on the outstanding principal amount thereof, for the
Interest Period applicable thereto, at a rate per annum equal to the sum of the
London Interbank Offered Rate for such Interest Period (determined in accordance
with Section 2.7(b) as if the related Money Market LIBOR Loan were a Euro-Dollar
Loan) plus (or minus) the Money Market Margin quoted by the Bank making such
Loan in accordance with Section 2.3. Each Money Market Absolute Rate Loan shall
bear interest on the outstanding principal amount thereof, for the Interest
Period applicable thereto, at a rate per annum equal to the Money Market
Absolute Rate quoted by the Bank making such Loan in accordance with Section
2.3. Such interest shall be payable for each Interest Period on the last day
thereof and, if such Interest Period is longer than ninety days, at intervals of
ninety days after the first day thereof.
(d) In the event that, and for so long as, any Event of
Default shall have occurred and be continuing, the outstanding principal amount
of the Loans, and, to the extent permitted by law, overdue interest in respect
of all Loans, shall bear interest at the annual rate of the sum of the Prime
Rate and four percent (4%).
(e) The Lead Agent shall determine each interest rate
applicable to the Loans (other than Money Market Loans) hereunder. The Lead
Agent shall give prompt notice to the applicable Borrower or CarrAmerica LP and
the Banks of each rate of interest so determined, and its determination thereof
shall be conclusive in the absence of manifest error.
(f) The Reference Bank agrees to use its best efforts to
furnish quotations to the Lead Agent as contemplated by this Section. If the
Reference Bank does not furnish a timely quotation, the provisions of Section
8.1 shall apply.
44
SECTION 2.8. Fees.
(a) Facility Fee. Effective as of the date hereof, during
the Term, the Borrowers and/or CarrAmerica LP shall pay to the Lead Agent for
the account of the Banks ratably in proportion to their respective Commitments a
facility fee (the "Facility Fee") equal to .20% per annum on the aggregate
Commitments. The Facility Fee shall be payable in arrears on each January 1,
April 1, July 1 and October 1 during the Term.
(b) Letter of Credit Fee. During the Term, the Borrowers
and/or CarrAmerica LP shall pay to the Lead Agent, for the account of the Banks
ratably in proportion to their respective interests in undrawn issued Letters of
Credit, a fee (a "Letter of Credit Fee") in an amount, provided that no Event of
Default shall have occurred and be continuing, equal to a rate per annum equal
to the Applicable Margin for Euro-Dollar Loans on the daily average of such
issued and undrawn Letters of Credit, which fee shall be payable, in arrears, on
each January 1, April 1, July 1 and October 1 during the term. From the
occurrence, and during the continuance, of an Event of Default, such fee shall
be in creased to be equal to four percent (4%) per annum on the daily average of
such issued and undrawn Letters of Credit.
(c) Fronting Bank Fee. The Borrowers and/or CarrAmerica LP
shall pay any Fronting Bank, for its own account, a fee (a "Fronting Bank Fee")
at a rate per annum equal to .15% of the issued and undrawn amount of such
Letter of Credit, which fee shall be in addition to and not in lieu of, the
Letter of Credit Fee. The Fronting Bank Fee shall be payable in arrears on each
January 1, April 1, July 1 and October 1 during the Term.
(d) Fees Non-Refundable. All fees set forth in this
Section 2.8 shall be deemed to have been earned on the date payment is due in
accordance with the provisions hereof and shall be non-refundable. The
obligation of the Borrowers and CarrAmerica LP to pay such fees in accordance
with the provisions hereof shall be binding upon the Borrowers and CarrAmerica
LP and shall inure to the benefit of the Lead Agent and the Banks regardless of
whether any Loans are actually made.
45
SECTION 2.9. Mandatory Termination. The term (the "Term")
of the Commitments shall terminate and expire on September 14, 2000 (the
"Maturity Date").
SECTION 2.10. Mandatory Prepayment.
(a) If as of the last day of any calendar quarter the
Borrowers LTV Ratio exceeds the Permitted LTV Ratio, but the Borrowers LTV Ratio
is not greater than 52.5%, and provided that no Event of Default has occurred
and is continuing, either (i) Carr or Carr LP shall add additional Real Property
Assets to the Unencumbered Asset Pool Properties within 90 days of the date the
Borrowers LTV Ratio exceeded the Permitted LTV Ratio, in accordance with the
provisions of Section 3.3, or (ii) the Borrowers and/or CarrAmerica LP shall pay
to the Lead Agent, for the account of the Banks, within 90 days of the date the
Borrowers LTV Ratio exceeded the Permitted LTV Ratio, an amount such that the
Loans outstanding subsequent to such payment do not cause the Borrowers LTV
Ratio to exceed the Permitted LTV Ratio. In the event that the Borrowers LTV
Ratio exceeds the Permitted LTV Ratio and is greater than or equal to 52.5%,
then the Borrowers and/or CarrAmerica LP shall, within twenty-five (25) Domestic
Business Days from the last day of any calendar quarter or the date of any New
Acquisition when the Permitted LTV Ratio is exceeded, pay to the Lead Agent, for
the account of the Banks, an amount such that the Loans outstanding subsequent
to such payment do not cause the Borrowers LTV Ratio to exceed the Permitted LTV
Ratio. Failure by the Borrowers to comply with the Borrowers LTV Ratio within 90
days or 25 Domestic Business Days, as the case may be, of the date of such
non-compliance shall be an Event of Default.
(b) In the event that an Unencumbered Asset Pool Property
is sold or released from the restrictions of Section 5.14 hereof, in accordance
with this Agreement, the applicable Borrower shall simultaneously with such sale
or release, prepay to the Lead Agent, for the account of the Banks, an amount
equal to the amount required such that the Tranche A Loans or Tranche B Loans,
as applicable, remain in compliance with the Permitted LTV Ratio after such sale
or release. Notwithstanding the foregoing, a simultaneous like-kind exchange
under Section 1031 of the Internal Revenue Code will not be subject to the
provisions of this Section 2.10(b) provided that the exchanged property has
qualified as a New Acquisition and any "boot" associated
46
therewith shall be applied to prepayment of the Tranche A Loans or Tranche B
Loans, as applicable. Sale of a property in violation of this Section 2.10 shall
constitute an Event of Default.
(c) In the event that the Unencumbered Asset Pool
Properties Minimum Debt Service Coverage is not maintained as of the last day of
a calendar quarter, either (i) the Borrowers will add a New Acquisition or a
Real Property Asset to the Unencumbered Asset Pool Properties in accordance with
this Agreement which, on a pro forma basis (i.e. the Unencumbered Asset Pool
Properties Minimum Debt Service Coverage shall be recalculated to include such
New Acquisition or Real Property Asset as though the same had been an
Unencumbered Asset Pool Property for the entire applicable period, with
appropriate pro forma adjustments to Unencumbered Asset Pool Net Operating Cash
Flow) would result in compliance with the Unencumbered Asset Pool Properties
Minimum Debt Service Coverage or (ii) the Borrowers and/or CarrAmerica LP shall
prepay to the Lead Agent, for the account of the Banks, an amount necessary to
cause the Unencumbered Asset Pool Properties Minimum Debt Service Coverage to be
in compliance. Failure by the Borrowers and/or CarrAmerica LP to comply with the
Unencumbered Asset Pool Properties Minimum Debt Service Coverage within 90 days
of the date of such non-compliance shall be an Event of Default.
(d) If as of the last day of any calendar quarter the Carr
LTV Ratio exceeds 50%, but the Carr LTV Ratio is not greater than 52.5%, and
provided that no Event of Default has occurred and is continuing, either (i)
Carr shall add additional Real Property Assets to the Carr Unencumbered Asset
Pool Properties within 90 days of the date the Carr LTV Ratio exceeded 50%, in
accordance with the provisions of Section 3.3, or (ii) Carr shall pay to the
Lead Agent, for the account of the Banks, within 90 days of the date the Carr
LTV Ratio exceeded 50%, an amount such that the Tranche A Loans outstanding
subsequent to such payment shall not cause the Carr LTV Ratio to be greater than
50%. In the event that the Carr LTV Ratio exceeds 50% and is greater than or
equal to 52.5%, then Carr shall, within twenty-five (25) Domestic Business Days
from the last day of any calendar quarter or the date of any New Acquisition
when the Carr LTV Ratio is greater than 50%, pay to the Lead Agent, for the
account of the Banks, an amount such that the Tranche A Loans outstanding
subsequent to such payment shall not cause
47
the Carr LTV Ratio to be greater than 50%. Failure by Carr to comply with the
Carr LTV Ratio within 90 days or 25 Domestic Business Days, as the case may be,
of the date of such non-compliance shall be an Event of Default.
(e) If as of the last day of any calendar quarter the Carr
LP LTV Ratio exceeds 50%, but the Carr LP LTV Ratio is not greater than 52.5%,
and provided that no Event of Default has occurred and is continuing, either (i)
Carr LP shall add additional Real Property Assets to the Carr LP Unencumbered
Asset Pool Properties within 90 days of the date the Carr LP LTV Ratio exceeded
50%, in accordance with the provisions of Section 3.3, or (ii) Carr LP shall pay
to the Lead Agent, for the account of the Banks, within 90 days of the date the
Carr LP LTV Ratio exceeded 50%, an amount such that the Tranche B Loans
outstanding subsequent to such payment shall not cause the Carr LP LTV Ratio to
be greater than 50%. In the event that the Carr LP LTV Ratio exceeds 50% and is
greater than or equal to 52.5%, then Carr LP shall, within twenty-five (25)
Domestic Business Days from the last day of any calendar quarter or the date of
any New Acquisition when the Carr LP LTV Ratio is greater than 50%, pay to the
Lead Agent, for the account of the Banks, an amount such that the Tranche B
Loans outstanding subsequent to such payment shall not cause the Carr LP LTV
Ratio to be greater than 50%. Failure by Carr LP to comply with the Carr LP LTV
Ratio within 90 days or 25 Domestic Business Days, as the case may be, of the
date of such non-compliance shall be an Event of Default.
SECTION 2.11. Optional Prepayments.
(a) The Borrowers or CarrAmerica LP may, upon at least one
Domestic Business Day's notice to the Lead Agent, prepay to the Lead Agent, for
the account of the Banks, any Base Rate Borrowing in whole at any time, or from
time to time in part in amounts aggregating One Million Dollars ($1,000,000), or
an integral multiple of One Million Dollars ($1,000,000) in excess thereof or,
if less, the outstanding principal balance, by paying the principal amount to be
prepaid together with accrued interest thereon to the date of prepayment. Each
such optional prepayment shall be applied to prepay ratably the Loans of the
several Banks included in such Borrowing. Any notice of prepayment delivered
pursuant to this Section 2.11(a) shall set forth the amount of such prepayment
which is applicable to any
48
Loan made for working capital purposes after such prepayment is made.
(b) Except as provided in Section 8.2, a Borrower or
CarrAmerica LP may not prepay all or any portion of the principal amount of any
Euro-Dollar Loan prior to the maturity thereof unless the applicable Borrower or
CarrAmerica LP shall also pay any applicable expenses pursuant to Section 2.13.
Any such prepayment shall be upon at least three (3) Euro-Dollar Business Days'
notice to the Lead Agent. Any notice of prepayment delivered pursuant to this
Section 2.11(b) shall set forth the amount of such prepayment which is
applicable to any Loan made for working capital purposes after such prepayment
is made. Each such optional prepayment shall be in the amounts set forth in
Section 2.11(a) above and shall be applied to prepay ratably the Loans of the
Banks included.
(c) The Borrower may not prepay any Money Market Loan
pursuant to this Section 2.11 except with the prior consent of the applicable
Bank or Designated Lender, as the case may be.
(d) A Borrower or CarrAmerica LP may, upon at least one
(1) Domestic Business Day's notice to the Lead Agent (by 11:00 a.m New York time
on such Domestic Business Day), reimburse the Lead Agent for the benefit of the
Fronting Bank for the amount of any drawing under a Letter of Credit in whole or
in part in any amount.
(e) A Borrower or CarrAmerica LP may at any time return
any undrawn Letters of Credit to the Fronting Bank in whole, but not in part,
and the Fronting Bank shall give the Lead Agent and each of the Banks notice of
such return.
(f) Either Borrower may at any time and from time to time
cancel all or any part of the Tranche A Commitments or Tranche B Commitments, as
applicable, in amounts aggregating One Million Dollars ($1,000,000), or an
integral multiple of One Million Dollars ($1,000,000) in excess thereof, by the
delivery to the Lead Agent and the Banks of a notice of cancellation upon at
least three (3) Domestic Business Days' notice to Lead Agent and the Banks,
whereupon, in either event, all or such portion of the Tranche A Commitments or
Tranche B Commitments, as applicable, shall terminate as to the Banks, pro rata
on the date set forth in such notice of cancellation, and, if there are any
Loans
49
then outstanding in an aggregate amount which exceeds the aggregate Tranche A
Commitments or Tranche B Commitments, as applicable (after giving effect to any
such reduction), the applicable Borrower shall prepay to the Lead Agent, for the
account of the Banks, as applicable, all or such portion of Loans outstanding on
such date in accordance with the requirements of Sections 2.11(a) and (b). In no
event shall either Borrower be permitted to cancel Commitments for which a
Letter of Credit has been issued and is outstanding unless such Borrower returns
(or causes to be returned) such Letter of Credit to the Fronting Bank. A
Borrower shall be permitted to designate in its notice of cancellation which
Loans, if any, are to be prepaid.
(g) Upon receipt of a notice of prepayment or cancellation
or a return of a Letter of Credit pursuant to this Section, the Lead Agent shall
promptly, and in any event within one (1) Domestic Business Day, notify each
Bank of the contents thereof and of such Bank's ratable share (if any) of such
prepayment or cancellation and such notice shall not thereafter be revocable by
the Borrowers or CarrAmerica LP.
(h) Any amounts so prepaid pursuant to this Section 2.11
may be reborrowed subject to the other terms of this Agreement. In the event
either Borrower elects to cancel all or any portion of the Commitments pursuant
to Section 2.11(e) hereof, such amounts may not be reborrowed.
SECTION 2.12. General Provisions as to Payments.
(a) The Borrowers and CarrAmerica LP shall make each
payment of principal of, and interest on, the Loans and of fees hereunder, not
later than 12:00 Noon (New York City time) on the date when due, in Federal or
other funds immediately available in New York City, to the Lead Agent at its
address referred to in Section 9.1. The Lead Agent will distribute to each Bank
its ratable share of each such payment received by the Lead Agent for the
account of the Banks on the same day as received by the Lead Agent if received
by the Lead Agent by 3:00 p.m. (New York City time), or, if received by the Lead
Agent after 3:00 p.m. (New York City time), on the immediately following
Domestic Business Day. Whenever any payment of principal of, or interest on, the
Base Rate Loans or of fees shall be due on a day which is not a Domestic
Business Day, the date for
50
payment thereof shall be extended to the next succeeding Domestic Business Day.
Whenever any payment of principal of, or interest on, the Euro-Dollar Loans
shall be due on a day which is not a Euro-Dollar Business Day, the date for
payment thereof shall be extended to the next succeeding Euro-Dollar Business
Day unless such Euro-Dollar Business Day falls in another calendar month, in
which case the date for payment thereof shall be the next preceding Euro-Dollar
Business Day. Whenever any payment of principal of, or interest on, the Money
Market Loans shall be due on a day which is not a Euro-Dollar Business Day, the
date for payment thereof shall be extended to the next succeeding Euro-Dollar
Business Day. If the date for any payment of principal is extended by operation
of law or otherwise, interest thereon shall be payable for such extended time.
(b) Unless the Lead Agent shall have received notice from
a Borrower or CarrAmerica LP prior to the date on which any payment is due to
the Banks hereunder that such Borrower or CarrAmerica LP will not make such
payment in full, the Lead Agent may assume that such Borrower or CarrAmerica LP,
as applicable has made such payment in full to the Lead Agent on such date and
the Lead Agent may, in reliance upon such assumption, cause to be distributed to
each Bank on such due date an amount equal to the amount then due such Bank. If
and to the extent that such Borrower or CarrAmerica LP shall not have so made
such payment, each Bank shall repay to the Lead Agent forthwith on demand such
amount distributed to such Bank together with interest thereon, for each day
from the date such amount is distributed to such Bank until the date such Bank
repays such amount to the Lead Agent, at the Federal Funds Rate.
SECTION 2.13. Funding Losses. If a Borrower or
CarrAmerica LP makes any payment of principal with respect to any Euro-Dollar
Loan (pursuant to Article II, VI or VIII or otherwise) on any day other than the
last day of the Interest Period applicable thereto, or the last day of an
applicable period fixed pursuant to Section 2.7(b), or if a Borrower fails to
borrow any Euro-Dollar Loans, after notice has been given to any Bank in
accordance with Section 2.4(a), such Borrower or CarrAmerica LP shall reimburse
each Bank within 15 days after demand for any resulting loss or expense incurred
by it (or by an existing Participant in the related Loan), including (without
limitation) any loss incurred in obtaining, liquidating or employing deposits
from third parties, but excluding loss of margin for the
51
period after any such payment or failure to borrow, provided that such Bank
shall have delivered to such Borrower or CarrAmerica LP a certificate as to the
amount of such loss or expense and the calculation thereof, which certificate
shall be conclusive in the absence of manifest error.
SECTION 2.14. Computation of Interest and Fees. Interest
based on the Prime Rate hereunder shall be computed on the basis of a year of
365 days (or 366 days in a leap year) and paid for the actual number of days
elapsed (including the first day but excluding the last day). All other interest
and fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.15. Method of Electing Interest Rates.
(a) The Loans included in each Borrowing shall bear
interest initially at the type of rate specified by such Borrower or CarrAmerica
LP in the applicable Notice of Borrowing. Thereafter, such Borrower or
CarrAmerica LP, as applicable, may from time to time elect to change or continue
the type of interest rate borne by each Group of Loans (subject in each case to
the provisions of Article VIII), as follows:
(i) if such Loans are Base Rate Loans, a Borrower or
CarrAmerica LP, as applicable, may elect to convert such Loans to
Euro-Dollar Loans as of any Euro-Dollar Business Day;
(ii) if such Loans are Euro-Dollar Loans, a Borrower or
CarrAmerica LP, as applicable, may elect to convert such Loans to Base
Rate Loans or elect to continue such Loans as Euro-Dollar Loans for an
additional Interest Period, in each case effective on the last day of
the then current Interest Period applicable to such Loans.
Each such election shall be made by delivering a notice (a "Notice of Interest
Rate Election") to the Lead Agent at least three (3) Euro-Dollar Business Days
before the conversion or continuation selected in such notice is to be effective
(unless the relevant Loans are to be continued as Base Rate Loans, in which case
such notice shall be delivered to the Lead Agent no later than 12:00 Noon (New
York City time) at least one (1) Domestic Business Day before such continuation
52
is to be effective). A Notice of Interest Rate Election may, if it so specifies,
apply to only a portion of the aggregate principal amount of the relevant Group
of Loans; provided that (i) such portion is allocated ratably among the Loans
comprising such Group, (ii) the portion to which such notice applies, and the
remaining portion to which it does not apply, are each $1,000,000 or any larger
multiple of $1,000,000, (iii) subject to Section 2.1, there shall be no more
than ten (10) Borrowings comprised of Euro-Dollar Loans outstanding at any time
under this Agreement, (iv) no Loan may be continued as, or converted into, a
Euro-Dollar Loan when any Event of Default has occurred and is continuing, and
(v) no Interest Period shall extend beyond the Maturity Date.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Group of Loans (or portion thereof) to which
such notice applies;
(ii) the date on which the conversion or continuation
selected in such notice is to be effective, which shall comply with the
applicable clause of subsection (a) above;
(iii) if the Loans comprising such Group are to be
converted, the new type of Loans and, if such new Loans are Euro-Dollar
Loans, the duration of the initial Interest Period applicable thereto;
and
(iv) if such Loans are to be continued as Euro-Dollar
Loans for an additional Interest Period, the duration of such
additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election
from a Borrower or CarrAmerica LP pursuant to subsection (a) above, the Lead
Agent shall notify each Bank on the same day as it receives such Notice of
Interest Rate Election of the contents thereof and such notice shall not
thereafter be revocable by such Borrower or CarrAmerica LP. If such Borrower or
CarrAmerica LP fails to deliver a timely Notice of Interest Rate Election to the
Lead Agent for any
53
Group of Euro-Dollar Loans, such Loans shall be converted into Base Rate Loans
on the last day of the then current Interest Period applicable thereto.
SECTION 2.16. Letters of Credit. (a) Subject to the terms
contained in this Agreement and the other Loan Documents, upon the receipt of a
notice in accordance with Section 2.2(b) requesting the issuance of a Letter of
Credit, the Fronting Bank shall issue a Letter of Credit or Letters of Credit in
such form as is reasonably acceptable to the applicable Borrower or CarrAmerica
LP, as applicable, in an amount or amounts equal to the amount or amounts
requested by the applicable Borrower or CarrAmerica LP.
(b) Each Letter of Credit shall be issued in the minimum
amount of One Million Dollars ($1,000,000).
(c) The Letter of Credit Usage shall be no more than
$30,000,000 at any one time.
(d) There shall be no more than five (5) Letters of Credit
outstanding at any one time.
(e) In the event of any request for a drawing under any
Letter of Credit by the beneficiary thereunder, the Fronting Bank shall notify
the applicable Borrower and the Lead Agent (and the Lead Agent shall endeavor to
notify each Bank thereof) on or before the date on which the Fronting Bank
intends to honor such drawing, and, except as provided in this subsection (e),
the applicable Borrower shall reimburse the Fronting Bank, in immediately
available funds, on the same day on which such drawing is honored in an amount
equal to the amount of such drawing. Notwithstanding anything contained herein
to the contrary, however, unless such Borrower or CarrAmerica LP shall have
notified the Lead Agent, and the Fronting Bank prior to 11:00 a.m. (New York
time) on the Domestic Business Day immediately prior to the date of such drawing
that such Borrower intends to reimburse the Fronting Bank for the amount of such
drawing with funds other than the proceeds of the Loans, the applicable Borrower
or CarrAmerica LP shall be deemed to have timely given a Notice of Borrowing
pursuant to Section 2.2 to the Lead Agent, requesting a Borrowing of Base Rate
Loans on the date on which such drawing is honored and in an amount equal to the
amount of such drawing. Each Bank (other than the Fronting Bank) shall, in
accordance with Section 2.4(b),
54
make available its share of such Borrowing to the Lead Agent, the proceeds of
which shall be applied directly by the Lead Agent to reimburse the Fronting Bank
for the amount of such draw. In the event that any such Bank fails to make
available to the Fronting Bank the amount of such Bank's participation on the
date of a drawing, the Fronting Bank shall be entitled to recover such amount on
demand from such Bank together with interest at the Federal Funds Rate
commencing on the date such drawing is honored.
(f) If, after the date hereof, any change in any law or
regulation or in the interpretation thereof by any court or administrative or
governmental authority charged with the administration thereof shall either (a)
impose, modify or deem applicable any reserve, special deposit or similar
requirement against letters of credit issued by, or assets held by, or deposits
in or for the account of, or participations in any letter of credit, upon any
Bank (including the Fronting Bank) or (b) impose on any Bank any other condition
regarding this Agreement or such Bank (including the Fronting Bank) as it
pertains to the Letters of Credit or any participation therein and the result of
any event referred to in the preceding clause (a) or (b) shall be to increase
the cost to the Fronting Bank or any Bank of issuing or maintaining any Letter
of Credit or participating therein then the applicable Borrower or CarrAmerica
LP shall pay to the Fronting Bank or such Bank, within 15 days after written
demand by such Bank (with a copy to the Lead Agent), which demand shall be
accompanied by a certificate showing, in reasonable detail, the calculation of
such amount or amounts, such additional amounts as shall be required to
compensate the Fronting Bank or such Bank for such increased costs or reduction
in amounts received or receivable hereunder together with interest thereon at
the Base Rate. The amount specified in the written demand shall, absent manifest
error, be final and conclusive and binding upon the Borrowers and CarrAmerica
LP.
(g) The Borrowers and CarrAmerica LP hereby agree to
protect, indemnify, pay and save the Fronting Bank harmless from and against any
and all claims, demands, liabilities, damages, losses, costs, charges and
expenses (including reasonable attorneys' fees and disbursements) which the
Fronting Bank may incur or be subject to as a result of (i) the issuance of the
Letters of Credit, other than as a result of the gross negligence or wilful
misconduct of the Fronting Bank or (ii) the failure of the Fronting
55
Bank to honor a drawing under any Letter of Credit as a result of any act or
omission, whether rightful or wrongful, of any present or future de jure or de
facto government or governmental authority (collectively, "Governmental Acts"),
other than as a result of the gross negligence or wilful misconduct of the
Fronting Bank. As between the Borrowers, CarrAmerica LP and the Fronting Bank,
the Borrowers and CarrAmerica LP assume all risks of the acts and omissions of,
or misuses of, the Letters of Credit issued by the Fronting Bank, by the
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, the Fronting Bank shall not be responsible (i) for the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application for and issuance of
such Letters of Credit, even if it should in fact prove to be in any and all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) for the
validity or insufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) for failure of the beneficiary
of any such Letter of Credit to comply fully with conditions required in order
to draw upon such Letter of Credit; (iv) for errors, omissions, interruptions or
delays in transmission or delivery of any message, by mail, cable, telegraph,
telex, facsimile transmission, or otherwise; (v) for errors in interpretation of
any technical terms; (vi) for any loss or delay in the transmission or otherwise
of any documents required in order to make a drawing under any such Letter of
Credit or of the proceeds thereof; (vii) for the misapplication by the
beneficiary of any such Letter of Credit of the proceeds of such Letter of
Credit; and (viii) for any consequence arising from causes beyond the control of
the Fronting Bank, including any Government Acts, in each case other than as a
result of the gross negligence or willful misconduct of the Fronting Bank. None
of the above shall affect, impair or prevent the vesting of the Fronting Bank's
rights and powers hereunder. In furtherance and extension and not in limitation
of the specific provisions hereinabove set forth, any action taken or omitted by
the Fronting Bank under or in connection with the Letters of Credit issued by it
or the related certificates, if taken or omitted in good faith, shall not put
the Fronting Bank under any resulting liability to the Borrowers or CarrAmerica
LP.
56
(h) If the Fronting Bank or the Lead Agent is required at
any time, pursuant to any bankruptcy, insolvency, liquidation or reorganization
law or otherwise, to return to the Borrowers or CarrAmerica LP any reimbursement
by the Borrowers or CarrAmerica LP of any drawing under any Letter of Credit,
each Bank shall pay to the Fronting Bank or the Lead Agent, as the case may be,
its share of such payment, but without interest thereon unless the Fronting Bank
or the Lead Agent is required to pay interest on such amounts to the person
recovering such payment, in which case with interest thereon, computed at the
same rate, and on the same basis, as the interest that the Fronting Bank or the
Lead Agent is required to pay.
SECTION 2.17. Letter of Credit Usage Absolute. The
obligations of the Borrowers and CarrAmerica LP under this Agreement in respect
of any Letter of Credit shall be unconditional and irrevocable, and shall be
paid strictly in accordance with the terms of this Agreement (as the same may be
amended from time to time) and any Letter of Credit Documents (as hereinafter
defined) under all circumstances, including, without limitation, to the extent
permitted by law, the following circumstances:
(a) any lack of validity or enforceability of any Letter
of Credit or any other agreement or instrument relating thereto (collectively,
the "Letter of Credit Documents") or any Loan Document;
(b) any change in the time, manner or place of payment of,
or in any other term of, all or any of the obligations of either Borrower or
CarrAmerica LP in respect of the Letters of Credit or any other amendment or
waiver of or any consent by either Borrower or CarrAmerica LP to departure from
all or any of the Letter of Credit Documents or any Loan Document, provided that
the Fronting Bank shall not consent to any such change or amendment unless
previously consented to in writing by either Borrower or CarrAmerica LP, as
applicable;
(c) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to departure
from any guaranty, for all or any of the obligations of either Borrower or
CarrAmerica LP in respect of the Letters of Credit;
57
(d) the existence of any claim, set-off, defense or other
right that either Borrower or CarrAmerica LP may have at any time against any
beneficiary or any transferee of a Letter of Credit (or any Persons for whom any
such beneficiary or any such transferee may be acting), the Lead Agent, the
Fronting Bank or any Bank (other than a defense based on the gross negligence or
wilful misconduct of the Lead Agent, the Fronting Bank or such Bank) or any
other Person, whether in connection with the Loan Documents, the transactions
contemplated hereby or by the Letters of Credit Documents or any unrelated
transaction;
(e) any draft or any other document presented under or in
connection with any Letter of Credit or other Loan Document proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect; provided that payment by the
Fronting Bank under such Letter of Credit against presentation of such draft or
document shall not have constituted gross negligence or wilful misconduct of the
Fronting Bank;
(f) payment by the Fronting Bank against presentation of a
draft or certificate that does not comply with the terms of the Letter of
Credit; provided that such payment shall not have constituted gross negligence
or wilful misconduct of the Fronting Bank; and
(g) any other circumstance or happening whatsoever other
than the payment in full of all obligations hereunder in respect of any Letter
of Credit or any agreement or instrument relating to any Letter of Credit,
whether or not similar to any of the foregoing, that might otherwise constitute
a defense available to, or a discharge of, the Borrowers or CarrAmerica LP;
provided that such other circumstance or happening shall not have been the
result of gross negligence or wilful misconduct of the Fronting Bank.
ARTICLE III
CONDITIONS
SECTION 3.1. Closing. The closing hereunder shall occur on
the date (the "Closing Date") when each of the following conditions is satisfied
(or waived by the Lead
58
Agent), each document to be dated the Closing Date unless otherwise indicated:
(a) Carr and CarrAmerica LP shall have executed and
delivered to the Lead Agent a Tranche A Note for the account of each Bank dated
on or before the Closing Date complying with the provisions of Section 2.5;
(b) Carr and Carr LP shall have executed and delivered to
the Lead Agent a Tranche B Note for the account of each Bank dated on or before
the Closing Date complying with the provisions of Section 2.5;
(c) the Borrowers and CarrAmerica LP shall have executed
and delivered to the Lead Agent a duly executed original of this Agreement;
(d) Lead Agent shall have received an opinion of Hogan &
Hartson L.L.P., with respect to certain matters of New York and Maryland law,
acceptable to the Lead Agent, the Banks and their counsel;
(e) the Lead Agent shall have received all documents the
Lead Agent may reasonably request relating to the existence of the Borrowers and
CarrAmerica LP, the authority for and the validity of this Agreement and the
other Loan Documents, and any other matters relevant hereto, all in form and
substance reasonably satisfactory to the Lead Agent. Such documentation shall
include, without limitation, the articles of incorporation and by-laws of Carr
and the partnership agreement and limited partnership certificate of Carr LP and
CarrAmerica LP, as amended, modified or supplemented to the Closing Date, each
certified to be true, correct and complete by a senior officer of Carr, Carr LP
or CarrAmerica LP, as applicable, as of a date not more than forty-five (45)
days prior to the Closing Date, together with a good standing certificate from
the Secretary of State (or the equivalent thereof) of Maryland with respect to
Carr and a good standing certificate from the Secretary of State (or the
equivalent thereof) of Delaware with respect to Carr LP and CarrAmerica LP and
from the Secretary of State (or the equivalent thereof) of each other State in
which Carr, Carr LP and CarrAmerica LP is required to be qualified to transact
business, each to be dated not more than forty-five (45) days prior to the
Closing Date;
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(f) the Lead Agent shall have received all certificates,
agreements and other documents and papers referred to in this Section 3.1 and
Section 3.2, unless otherwise specified, in sufficient counterparts,
satisfactory in form and substance to the Lead Agent in its sole discretion;
(g) the Borrowers and CarrAmerica LP shall have taken all
actions required to authorize the execution and delivery of this Agreement and
the other Loan Documents and the performance thereof by the Borrowers and
CarrAmerica LP;
(h) the Lead Agent shall have received an unaudited
consolidated balance sheet and income statement of Carr for the fiscal quarter
ended June 30, 1997;
(i) the Lead Agent shall have received wire transfer
instructions in connection with the Loans to be made on the Closing Date;
(j) the Lead Agent shall have received, for its and any
other Bank's account, all fees due and payable pursuant to Section 2.8 hereof on
or before the Closing Date, and the reasonable fees and expenses accrued through
the Closing Date of Skadden, Arps, Slate, Meagher & Flom LLP;
(k) the Lead Agent shall have received copies of all
consents, licenses and approvals, if any, required in connection with the
execution, delivery and performance by the Borrower and CarrAmerica LP, and the
validity and enforceability, of the Loan Documents, or in connection with any of
the transactions contemplated thereby, and such consents, licenses and approvals
shall be in full force and effect;
(l) the Lead Agent shall have received satisfactory
reports of Uniform Commercial Code filing searches conducted by a search firm
acceptable to the Lead Agent with respect to the Borrowers, such searches to be
conducted in each of the locations specified by the Lead Agent;
(m) no material defaults or Events of Default (as defined
therein) shall exist under the Existing Credit Agreement or any existing
agreement entered into by either Borrower or CarrAmerica LP in connection with
any Debt of such Borrower or CarrAmerica LP;
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(n) the representations and warranties of the Borrowers
and CarrAmerica LP contained in this Agreement shall be true and correct in all
material respects on and as of the Closing Date both before and after giving
effect to the making of any Loans;
(o) receipt by the Lead Agent and the Banks of a
certificate of the chief financial officer or the chief accounting officer of
Carr certifying that the Borrowers and CarrAmerica LP are in compliance with all
covenants of the Borrowers and CarrAmerica LP contained in this Agreement,
including, without limitation, the requirements of Section 5.8, as of the
Closing Date.
The Lead Agent shall promptly notify the Borrowers and CarrAmerica LP and the
Banks of the Closing Date, and such notice shall be conclusive and binding on
all parties hereto.
SECTION 3.2. Borrowings. The obligation of any Bank to
make a Loan on the occasion of any Borrowing or to participate in any Letter of
Credit issued by the Fronting Bank and the obligation of the Fronting Bank to
issue a Letter of Credit on the occasion of any Borrowing is subject to the
satisfaction of the following conditions:
(a) the Closing Date shall have occurred on or prior to
September 30, 1997;
(b) receipt by the Lead Agent of a Notice of Borrowing as
required by Section 2.2 or Section 2.3;
(c) immediately after such Borrowing, the Outstanding
Balance will not exceed the aggregate amount of the Commitments and with respect
to each Bank, such Bank's pro rata portion of the Loans and Letter of Credit
Usage will not exceed such Bank's Commitment;
(d) immediately before and after such Borrowing, no
Default or Event of Default shall have occurred and be continuing both before
and after giving effect to the making of such Loans;
(e) the representations and warranties of the Borrowers
and CarrAmerica LP contained in this Agreement shall be true and correct in all
material respects on and as of the
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date of such Borrowing both before and after giving effect to the making of such
Loans;
(f) no law or regulation shall have been adopted, no
order, judgment or decree of any governmental authority shall have been issued,
and no litigation shall be pending or threatened, which does or, with respect to
any threatened litigation, seeks to enjoin, prohibit or restrain, the making or
repayment of the Loans, the issuance of any Letters of Credit or any
participations therein or the consummation of the transactions contemplated
hereby; and
(g) no event, act or condition shall have occurred after
the Closing Date which, in the reasonable judgment of the Lead Agent or the
Required Banks, as the case may be, has had or is likely to have a Material
Adverse Effect.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the applicable Borrower and CarrAmerica LP, if applicable, on the date of such
Borrowing as to the facts specified in clauses (c) through (g) of this Section
(except that with respect to clause (f), such representation and warranty shall
be deemed to be limited to laws, regulations, orders, judgments, decrees and
litigation affecting the Borrowers or CarrAmerica LP and not solely the Banks).
SECTION 3.3 New Acquisitions and Additional Real Property
Assets. All New Acquisitions or Real Property Assets may be added to the
Unencumbered Asset Pool Properties upon written notice from either Borrower to
the Lead Agent specifying that such New Acquisition has been acquired and that
the same qualify as an Unencumbered Asset Pool Property.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
In order to induce the Lead Agent and each of the other Banks which may
become a party to this Agreement to make the Loans, the applicable Borrower or
CarrAmerica LP makes the following representations and warranties as of the date
hereof. Such representations and warranties shall survive the effectiveness of
this Agreement, the execution and
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delivery of the other Loan Documents and the making of the Loans.
SECTION 4.1. Existence and Power of Carr. Carr is duly
organized, validly existing and in good standing as a corporation under the laws
of the State of Maryland and has all powers and all material governmental
licenses, authorizations, consents and approvals required to own its property
and assets and carry on its business as now conducted or as it presently
proposes to conduct and has been duly qualified and is in good standing in every
jurisdiction in which the failure to be so qualified and/or in good standing is
likely to have a Material Adverse Effect.
SECTION 4.2. Existence and Power of Carr LP and
CarrAmerica LP. Carr LP and CarrAmerica LP are each duly organized, validly
existing and in good standing as a limited partnership under the laws of the
State of Delaware and each has all powers and all material governmental
licenses, authorizations, consents and approvals required to own its property
and assets and carry on its business as now conducted or as it presently
proposes to conduct and each has been duly qualified and is in good standing in
every jurisdiction in which the failure to be so qualified and/or in good
standing is likely to have a Material Adverse Effect.
SECTION 4.3. Power and Authority of Carr. Carr has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of each of the Loan Documents to which it is a party and has taken
all necessary action to authorize the execution and delivery on behalf of Carr
and the performance by Carr of such Loan Documents. Carr has duly executed and
delivered each Loan Document to which it is a party, and each such Loan Document
constitutes the legal, valid and binding obligation of Carr, enforceable in
accordance with its terms, except as enforceability may be limited by applicable
insolvency, bankruptcy or other laws affecting creditors rights generally, or
general principles of equity, whether such enforceability is considered in a
proceeding in equity or at law.
SECTION 4.4. Power and Authority of Carr LP and
CarrAmerica LP. Carr LP and CarrAmerica LP each have the partnership power and
authority to execute, deliver and carry out the terms and provisions of each of
the Loan Documents to which it is a party and has taken all necessary action to
authorize the execution and delivery on behalf of
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Carr LP or CarrAmerica LP, as applicable, and the performance by Carr LP or
CarrAmerica LP, as applicable, of such Loan Documents. Carr LP and CarrAmerica
LP have each duly executed and delivered each Loan Document to which it is a
party, and each such Loan Document constitutes the legal, valid and binding
obligation of Carr LP or CarrAmerica LP, as applicable, enforceable in
accordance with its terms, except as enforceability may be limited by applicable
insolvency, bankruptcy or other laws affecting creditors rights generally, or
general principles of equity, whether such enforceability is considered in a
proceeding in equity or at law.
SECTION 4.5. No Violation. Neither the execution, delivery
or performance by or on behalf of the Borrowers or CarrAmerica LP of the Loan
Documents, nor compliance by the Borrowers or CarrAmerica LP with the terms and
provisions thereof nor the consummation of the transactions contemplated by the
Loan Documents, (i) will contravene any applicable provision of any law,
statute, rule, regulation, order, writ, injunction or decree of any court or
governmental instrumentality or (ii) will conflict with or result in any breach
of, any of the terms, covenants, conditions or provisions of, or constitute a
default under, or result in the creation or imposition of (or the obligation to
create or impose) any Lien upon any of the property or assets of the Borrowers
or CarrAmerica LP pursuant to the terms of any indenture, mortgage, deed of
trust, or other agreement or other instrument to which the Borrowers or
CarrAmerica LP (or of any partnership of which either Borrower is a partner) is
a party or by which it or any of its property or assets is bound or to which it
is subject or (iii) will cause a default by either Borrower or CarrAmerica LP
under any organizational document of any Subsidiary, or cause a default under
Carr's articles of incorporation or by-laws or Carr LP's or CarrAmerica LP's
agreement of limited partnership.
SECTION 4.6. Financial Information.
(a) The unaudited consolidated balance sheet of Carr as of
June 30, 1997, a copy of which has been delivered to the Lead Agent, fairly
presents, in conformity with generally accepted accounting principles, the
consolidated financial position of Carr as of such date and its consolidated
results of operations for such fiscal year.
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(b) Since June 30, 1997, (i) there has been no material
adverse change in the business, financial position or results of operations of
the Borrowers and (ii) except as previously disclosed to the Lead Agent or as
publicly disclosed, neither the Borrowers nor CarrAmerica LP have incurred any
material indebtedness or guaranty.
SECTION 4.7. Litigation.
(a) There is no action, suit or proceeding pending
against, or to the knowledge of the Borrowers or CarrAmerica LP, threatened
against or affecting, (i) the Borrowers or CarrAmerica LP or any of their
Subsidiaries, (ii) the Loan Documents or any of the transactions contemplated by
the Loan Documents or (iii) any of their assets, in any case before any court or
arbitrator or any governmental body, agency or official in which there is a
reasonable likelihood of an adverse decision which could, individually or in the
aggregate, have a Material Adverse Effect or which in any manner draws into
question the validity of this Agreement or the other Loan Documents.
(b) There are no final nonappealable judgments or decrees
in an aggregate amount of Five Million Dollars ($5,000,000) or more entered by a
court or courts of competent jurisdiction against the Borrowers or either
Borrower or CarrAmerica LP (other than any judgment as to which, and only to the
extent, a reputable insurance company has acknowledged coverage of such claim in
writing).
SECTION 4.8. Compliance with ERISA.
(a) Except as previously disclosed to the Lead Agent in
writing, each member of the ERISA Group has fulfilled its obligations under the
minimum funding standards of ERISA and the Internal Revenue Code with respect to
each Plan and is in compliance in all material respects with the presently
applicable provisions of ERISA and the Internal Revenue Code with respect to
each Plan. No member of the ERISA Group has (i) sought a waiver of the minimum
funding standard under Section 412 of the Internal Revenue Code in respect of
any Plan, (ii) failed to make any contribution or payment to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement, or made any
amendment to any Plan or Benefit Arrangement, which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security under
ERISA or the Internal Revenue Code or (iii)
65
incurred any liability under Title IV of ERISA other than a liability to the
PBGC for premiums under Section 4007 of ERISA.
(b) The transactions contemplated by the Loan Documents
will not constitute a nonexempt prohibited transaction (as such term is defined
in Section 4975 of the Code or Section 406 of ERISA) that could subject the Lead
Agent or the Banks to any tax or penalty or prohibited transactions imposed
under Section 4975 of the Code or Section 502(i) of ERISA.
SECTION 4.9. Environmental Matters. In the ordinary course
of its business, the Borrowers and CarrAmerica LP each review the effect of
Environmental Laws on the business, operations and properties of the Borrowers
and their subsidiaries or CarrAmerica LP, as applicable, in the course of which
they identify and evaluate associated liabilities and costs (including, without
limitation, any capital or operating expenditures required for clean-up or
closure of properties presently or previously owned, any capital or operating
expenditures required to achieve or maintain compliance with environmental
protection standards imposed by law or as a condition of any license, permit or
contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level of or
change in the nature of operations conducted thereat, any costs or liabilities
in connection with off-site disposal of wastes or Hazardous Substances, and any
actual or potential liabilities to third parties, including employees, and any
related costs and expenses). On the basis of this review, the Borrowers and
CarrAmerica LP have reasonably concluded that such associated liabilities and
costs, including the costs of compliance with Environmental Laws, are unlikely
to have a Material Adverse Effect.
SECTION 4.10. Taxes. The initial tax year of each Borrower
for federal income tax purposes was 1993. The initial tax year of CarrAmerica LP
for federal income tax purposes was 1996. The Borrowers and their subsidiaries
and CarrAmerica LP have filed all United States Federal income tax returns and
all other material tax returns which are required to be filed by them and have
paid all taxes due pursuant to such returns or pursuant to any assessment
received by the Borrowers or any subsidiary. The charges, accruals and reserves
on the books of the Borrowers and
66
their subsidiaries and CarrAmerica LP in respect of taxes or other governmental
charges are, in the opinion of the Borrowers and CarrAmerica LP, adequate.
SECTION 4.11. Full Disclosure. All information heretofore
furnished by the Borrowers or CarrAmerica LP to the Lead Agent or any Bank for
purposes of or in connection with this Agreement or any transaction contemplated
hereby is true and accurate in all material respects on the date as of which
such information is stated or certified. The Borrowers and CarrAmerica LP have
disclosed to the Banks in writing any and all facts known to the Borrowers or
CarrAmerica LP which materially and adversely affect or are likely to materially
and adversely affect (to the extent the Borrowers or CarrAmerica LP can now
reasonably foresee), the business, operations or financial condition of the
Borrowers and CarrAmerica LP considered as one enterprise or the ability of the
Borrowers or CarrAmerica LP, as applicable, to perform their obligations under
this Agreement or the other Loan Documents.
SECTION 4.12. Solvency. On the Closing Date and after
giving effect to the transactions contemplated by the Loan Documents occurring
on the Closing Date, each Borrower and CarrAmerica LP is Solvent.
SECTION 4.13. Use of Proceeds; Margin Regulations. All
proceeds of the Loans will be used by the Borrowers only in accordance with the
provisions hereof. No part of the proceeds of any Loan will be used by the
Borrowers to purchase or carry any Margin Stock or to extend credit to others
for the purpose of purchasing or carrying any Margin Stock. Neither the making
of any Loan nor the use of the proceeds thereof will violate or be inconsistent
with the provisions of Regulations G, T, U or X of the Federal Reserve Board.
SECTION 4.14. Governmental Approvals. No order, consent,
approval, license, authorization, or validation of, or filing, recording or
registration with, or exemption by, any governmental or public body or
authority, or any subdivision thereof, is required to authorize, or is required
in connection with the execution, delivery and performance of any Loan Document
or the consummation of any of the transactions contemplated thereby other than
those that have already been duly made or obtained and remain in full force and
effect.
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SECTION 4.15. Investment Company Act; Public Utility
Holding Company Act. Neither Borrower nor CarrAmerica LP is (x) an "investment
company" or a company "controlled" by an "investment company", within the
meaning of the Investment Company Act of 1940, as amended, (y) a "holding
company" or a "subsidiary company" of a "holding company" or an "affiliate" of
either a "holding company" or a "subsidiary company" within the meaning of the
Public Utility Holding Company Act of 1935, as amended, or (z) subject to any
other federal or state law or regulation which purports to restrict or regulate
its ability to borrow money.
SECTION 4.16. Closing Date Transactions. On the Closing
Date and immediately prior to the making of the Loans, the transactions (other
than the making of the Loans) intended to be consummated on the Closing Date
will have been consummated in accordance with all applicable laws. All consents
and approvals of, and filings and registrations with, and all other actions by,
any Person required in order to make or consummate such transactions have been
obtained, given, filed or taken and are in full force and effect.
SECTION 4.17. Representations and Warranties in Loan
Documents. All representations and warranties made by the Borrowers and
CarrAmerica LP in the Loan Documents are true and correct in all material
respects.
SECTION 4.18. Patents, Trademarks, etc. Each Borrower and
CarrAmerica LP has obtained and holds in full force and effect all patents,
trademarks, service marks, trade names, copyrights and other such rights, free
from burdensome restrictions, which are necessary for the operation of its
business as presently conducted, the impairment of which is likely to have a
Material Adverse Effect. To the Borrowers' and CarrAmerica LP's knowledge, no
material product, process, method, substance, part or other material presently
sold by or employed by the Borrowers or CarrAmerica LP in connection with such
business infringes any patent, trademark, service mark, trade name, copyright,
license or other such right owned by any other Person. There is not pending or,
to the Borrowers' and CarrAmerica LP's knowledge, threatened any claim or
litigation against or affecting either Borrower or CarrAmerica LP contesting its
right to sell or use any such product, process, method, substance, part or other
material.
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SECTION 4.19. No Default. No Default or Event of Default
exists under or with respect to any Loan Document. Neither Borrower nor
CarrAmerica LP is in default in any material respect beyond any applicable grace
period under or with respect to any other material agreement, instrument or
undertaking to which it is a party or by which it or any of its property is
bound in any respect, the existence of which default is likely (to the extent
that the Borrowers or CarrAmerica LP, as applicable, can now reasonably foresee)
to result in a Material Adverse Effect.
SECTION 4.20. Licenses, etc. Each Borrower and CarrAmerica
LP has obtained and holds in full force and effect, all franchises, licenses,
permits, certificates, authorizations, qualifications, accreditations,
easements, rights of way and other consents and approvals which are necessary
for the operation of its businesses as presently conducted, the absence of which
is likely (to the extent that the Borrowers or CarrAmerica LP, as applicable,
can now reasonably foresee) to have a Material Adverse Effect.
SECTION 4.21. Compliance With Law. Each Borrower and
CarrAmerica LP is in compliance with all laws, rules, regulations, orders,
judgments, writs and decrees, including, without limitation, all building and
zoning ordinances and codes, the failure to comply with which is likely (to the
extent that the Borrowers or CarrAmerica LP, as applicable, can now reasonably
foresee) to have a Material Adverse Effect.
SECTION 4.22. No Burdensome Restrictions. Neither Borrower
nor CarrAmerica LP is a party to any agreement or instrument or subject to any
other obligation or any charter or corporate or partnership restriction, as the
case may be, which, individually or in the aggregate, is likely (to the extent
that the Borrowers or CarrAmerica LP, as applicable, can now reasonably foresee)
to have a Material Adverse Effect.
SECTION 4.23. Brokers' Fees. Neither Borrower nor
CarrAmerica LP has dealt with any broker or finder with respect to the
transactions contemplated by the Loan Documents (except with respect to the
acquisition or disposition of Real Property Assets) or otherwise in connection
with this Agreement, and neither Borrower nor CarrAmerica LP has done any acts,
had any negotiations or conversation, or made any agreements or promises which
will in any way create or give
69
rise to any obligation or liability for the payment by the Borrower or
CarrAmerica LP of any brokerage fee, charge, commission or other compensation to
any party with respect to the transactions contemplated by the Loan Documents
(except with respect to the acquisition or disposition of Real Property Assets),
other than the fees payable hereunder.
SECTION 4.24. Labor Matters. There are no collective
bargaining agreements or Multiemployer Plans covering the employees of the
Borrowers or CarrAmerica LP and the Borrowers or CarrAmerica LP have not
suffered any strikes, walkouts, work stoppages or other material labor
difficulty within the last five (5) years.
SECTION 4.25. Organizational Documents. The documents
delivered pursuant to Section 3.1(e) constitute, as of the Closing Date, all of
the organizational documents (together with all amendments and modifications
thereof) of the Borrowers. The Borrowers represent that they have delivered to
the Lead Agent true, correct and complete copies of each of the documents set
forth in this Section 4.25. CarrAmerica LP represents that it has delivered to
the Lead Agent and the Banks true, correct and complete copies of all of the
organizational documents (together with all amendments and modifications
thereof) of CarrAmerica LP as of the Closing Date.
SECTION 4.26. Principal Offices. The principal office,
chief executive office and principal place of business of each of the Borrowers
and CarrAmerica LP is 1700 Pennsylvania Avenue, N.W., Washington, D.C.
SECTION 4.27. REIT Status. For the fiscal year ended
December 31, 1996, Carr qualified and Carr intends to continue to qualify as a
real estate investment trust under the Code.
SECTION 4.28. Ownership of Property. Schedule 4.28
attached hereto and made a part hereof sets forth all the real property owned or
leased by the Borrowers and Persons in which the Borrowers, directly or
indirectly, own an interest as of the Closing Date. As of the Closing Date, each
Borrower and such Persons have good and insurable fee simple title (or leasehold
title if so designated on Schedule 4.28) to all of such real property, subject
to customary encumbrances and liens as of the date of this Agreement.
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As of the date of this Agreement, there are no mortgages, deeds of trust,
indentures, debt instruments or other agreements creating a Lien against any of
the Real Property Assets except as disclosed on Schedule 4.28.
SECTION 4.29. Insurance. Each Borrower and CarrAmerica LP
currently maintains, or causes its tenants to maintain, insurance at 100%
replacement cost insurance coverage (subject to customary deductibles) in
respect of each of the Real Property Assets, as well as commercial general
liability insurance (including "builders' risk") against claims for personal,
and bodily injury and/or death, to one or more persons, or property damage, as
well as workers' compensation insurance, in each case with respect to the Real
Property Assets with insurers having an A.M. Best policyholders' rating of not
less than A-IX in amounts that prudent owner of assets such as the Real Property
Assets would maintain.
ARTICLE V
AFFIRMATIVE AND NEGATIVE COVENANTS
Each Borrower and CarrAmerica LP covenant and agree that, so long as
any Bank has any Commitment hereunder or any Obligations remain unpaid:
SECTION 5.1. Information. The applicable Borrower will
deliver to the Lead Agent and to each of the Banks:
(a) as soon as available and in any event within 105 days
after the end of each fiscal year of Carr, an audited consolidated balance sheet
of Carr as of the end of such fiscal year and the related consolidated
statements of cash flow and operations for such fiscal year, setting forth in
each case in comparative form the figures for the previous fiscal year, audited
by KPMG Peat Marwick LLP or other independent public accountants of similar
standing;
(b) as soon as available and in any event within fifty
(50) days after the end of each quarter of each fiscal year of Carr, a statement
of Carr, prepared on a GAAP basis, setting forth the operating income and
operating expenses of
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Carr, in sufficient detail so as to calculate net operating cash flow of Carr
for the immediately preceding quarter;
(c) simultaneously with the delivery of each set of
financial statements referred to in clauses (a) and (b) above, a certificate of
the chief financial officer or the chief accounting officer of Carr (i) setting
forth in reasonable detail the calculations required to establish whether the
Borrowers were in compliance with the requirements of Section 5.8 on the date of
such financial statements;(ii) stating whether any Default exists on the date of
such certificate and, if any Default then exists, setting forth the details
thereof and the action which the applicable Borrower or CarrAmerica LP is taking
or proposes to take with respect thereto; and (iii) certifying (x) that such
financial statements fairly present the financial condition and the results of
operations of Carr as of the dates and for the periods indicated, on the basis
of generally accepted accounting principles, subject, in the case of interim
financial statements, to normal year-end adjustments, and (y) that such officer
has reviewed the terms of the Loan Documents and has made, or caused to be made
under his or her supervision, a review in reasonable detail of the business and
condition of the applicable Borrower or CarrAmerica LP during the period
beginning on the date through which the last such review was made pursuant to
this Section 5.1(c) (or, in the case of the first certification pursuant to this
Section 5.1(c), the Closing Date) and ending on a date not more than ten (10)
Domestic Business Days prior to the date of such delivery and that on the basis
of such review of the Loan Documents and the business and condition of the
applicable Borrower or CarrAmerica LP, to the best knowledge of such officer, no
Default or Event of Default under any other provision of Section 6.1 occurred
or, if any such Default or Event of Default has occurred, specifying the nature
and extent thereof and, if continuing, the action the applicable Borrower or
CarrAmerica LP proposes to take in respect thereof;
(d) simultaneously with the delivery of each set of
financial statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements confirming the
calculations set forth in the officer's certificate delivered simultaneously
therewith pursuant to clause (c) above;
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(e) (i) within five (5) days after the president, chief
financial officer, treasurer, controller or other executive officer of either
Borrower or CarrAmerica LP obtains knowledge of any Default, if such Default is
then continuing, a certificate of the chief financial officer or the president
of such Borrower or CarrAmerica LP setting forth the details thereof and the
action which such Borrower or CarrAmerica LP is taking or proposes to take with
respect thereto; (ii) promptly and in any event within ten (10) days after
either Borrower or CarrAmerica LP obtains knowledge thereof, notice of (x) any
litigation or governmental proceeding pending or threatened against the Borrower
or CarrAmerica LP, as applicable, as to which, if adversely determined, is
likely to individually or in the aggregate, result in a Material Adverse Effect,
and (y) any other event, act or condition which is likely to result in a
Material Adverse Effect;
(f) if and when any member of the ERISA Group (i) gives or
is required to give notice to the PBGC of any "reportable event" (as defined in
Section 4043 of ERISA) with respect to any Plan which might constitute grounds
for a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of
such notice; (iv) applies for a waiver of the minimum funding standard under
Section 412 of the Internal Revenue Code, a copy of such application; (v) gives
notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of
such notice and other information filed with the PBGC; (vi) gives notice of
withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such
notice; or (vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security, a
certificate of the chief financial officer or the chief accounting officer of
such Borrower or CarrAmerica LP setting forth details as to
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such occurrence and action, if any, which such Borrower, CarrAmerica LP or
applicable member of the ERISA Group is required or proposes to take;
(g) promptly and in any event within five (5) Domestic
Business Days after either Borrower or CarrAmerica LP obtains actual knowledge
of any of the following events, a certificate of the applicable Borrower or
CarrAmerica LP, executed by an officer of the applicable Borrower or CarrAmerica
LP, specifying the nature of such condition and such Borrower's or CarrAmerica
LP's, if the applicable Borrower or CarrAmerica LP, as the case may be, has
actual knowledge thereof, the Environmental Affiliate's proposed initial
response thereto: (i) the receipt by the applicable Borrower or CarrAmerica LP,
or, if such Borrower or CarrAmerica LP has actual knowledge thereof, any of the
Environmental Affiliates, of any communication (written or oral), whether from a
governmental authority, citizens group, employee or otherwise, that alleges that
the applicable Borrower or CarrAmerica LP, or, if the applicable Borrower or
CarrAmerica LP has actual knowledge thereof, any of the Environmental
Affiliates, is not in compliance with applicable Environmental Laws, and such
noncompliance is likely to have a Material Adverse Effect, (ii) the applicable
Borrower or CarrAmerica LP shall obtain actual knowledge that there exists any
Environmental Claim pending or threatened against the applicable Borrower,
CarrAmerica LP or any Environmental Affiliate or (iii) the applicable Borrower
obtains actual knowledge of any release, emission, discharge or disposal of any
Materials of Environmental Concern that are likely to form the basis of any
Environmental Claim against the applicable Borrower, CarrAmerica LP or any
Environmental Affiliate;
(h) promptly and in any event within five (5) Domestic
Business Days after receipt of any material notices or correspondence from any
company or agent for any company providing insurance coverage to either Borrower
or CarrAmerica LP relating to any material loss or loss in excess of $1,500,000
of the applicable Borrower or CarrAmerica LP, copies of such notices and
correspondence; and
(i) promptly upon the mailing thereof to the shareholders
or partners of either Borrower or CarrAmerica LP, copies of all financial
statements, reports and proxy statement so mailed;
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(j) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any registration
statements on Form S-8 or its equivalent) and reports on Forms 10-K, 10-Q and
8-K (or their equivalents) which either Borrower or CarrAmerica LP shall have
filed with the Securities and Exchange Commission;
(k) simultaneously with delivery of the certificate
required pursuant to Section 5.1(c), an updated Schedule 4.28, certified by the
chief financial officer or any senior vice president or executive vice president
of Carr as true, correct and complete as of the date such updated schedules are
delivered;
(l) within 5 days after filing of the annual income tax
return with the Internal Revenue Service, a certificate of the chief financial
officer or chief accounting officer of Carr certifying that Carr is properly
classified and continues to qualify as a real estate investment trust under the
Internal Revenue Code and has taken all actions consistent with maintaining such
status;
(m) simultaneously with delivery of the information
required by Sections 5.1(a) and (b), a statement of Unencumbered Asset Pool Net
Operating Cash Flow with respect to each Unencumbered Asset Pool Property and a
list of all Unencumbered Asset Pool Properties and a statement with respect to
the occupancy at the end of the relevant period for each Unencumbered Asset Pool
Property; and
(n) from time to time such additional information
regarding the financial position or business of the Borrowers as the Lead Agent,
at the request of any Bank, may reasonably request.
SECTION 5.2. Payment of Obligations. Each Borrower and
CarrAmerica LP will pay and discharge, at or before maturity, all its material
obligations and liabilities including, without limitation, any obligation
pursuant to any agreement by which it or any of its properties is bound and any
tax liabilities, except where such tax liabilities may be contested in good
faith by appropriate proceedings, and will maintain in accordance with generally
accepted accounting principles, appropriate reserves for the accrual of any of
the same, in any case, where failure to do so will likely result in a Material
Adverse Effect.
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SECTION 5.3. Maintenance of Property; Insurance.
(a) Each Borrower and CarrAmerica LP will keep, and will
cause each of its Subsidiaries to keep, all property useful and necessary in its
business, including, without limitation, the Real Property Assets, in good
repair, working order and condition, ordinary wear and tear and the provisions
of any mortgage with respect to casualty or condemnation events excepted.
(b) Each Borrower and CarrAmerica LP shall or shall cause
the Subsidiaries to maintain "all risk" insurance covering 100% replacement cost
of its real property assets with insurers having an A.M. Best policyholder's
rating of not less than A-VIII, which insurance shall in any event not provide
for materially less coverage than the insurance in effect on the Closing Date,
and furnish to each Bank from time to time, upon written request, copies of
certificates of insurance under which such insurance is issued and such other
information relating to such insurance as such Bank may reasonably request.
SECTION 5.4. Conduct of Business. Each Borrower and
CarrAmerica LP will continue to engage in business of the same general type as
now conducted by each Borrower and CarrAmerica LP, as the case may be.
SECTION 5.5. Compliance with Laws. Each Borrower and
CarrAmerica LP will comply in all material respects with all applicable laws,
ordinances, rules, regulations, and requirements of governmental authorities
(including, without limitation, Environmental Laws, all zoning and building
codes and ERISA and the rules and regulations thereunder) except where the
necessity of compliance therewith is contested in good faith by appropriate
proceedings.
SECTION 5.6. Inspection of Property, Books and Records.
The Borrowers and CarrAmerica LP will keep proper books of record and account in
which full, true and correct entries shall be made of all dealings and
transactions in relation to its business and activities; and will permit
representatives of any Bank at such Bank's expense to visit and inspect any of
its properties to examine and make abstracts from any of its books and records
and to discuss its affairs, finances and accounts with its officers, employees
and independent public accountants, all at such reasonable
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times, upon reasonable notice, and as often as may reasonably be desired.
SECTION 5.7. Existence.
(a) Each Borrower and CarrAmerica LP shall do or cause to
be done all things necessary to preserve and keep in full force and effect its
corporate existence or its partnership existence, as applicable.
(b) Each Borrower and CarrAmerica LP shall do or cause to
be done all things necessary to preserve and keep in full force and effect its
patents, trademarks, servicemarks, tradenames, copyrights, franchises, licenses,
permits, certificates, authorizations, qualifications, accreditations,
easements, rights of way and other rights, consents and approvals the
nonexistence of which is likely to have a Material Adverse Effect.
SECTION 5.8. Financial Covenants.
(a) Debt Service Coverage. Measured as of the last day of
each calendar quarter, the ratio of (i) Annual EBITDA to (ii) the sum of (x)
Debt Service plus (y) reserves for Capital Expenditures of $1.50 per square foot
per annum for each Real Property Asset, will not be less than 1.75:1.
(b) Maximum Total Debt to Tangible FMV. As of the last day
of each calendar quarter, the Maximum Total Debt Ratio will not be greater than
50%.
(c) Carr Maximum Total Debt to Carr Tangible FMV. As of
the last day of each calendar quarter, the Carr Maximum Total Debt Ratio will
not be greater than 50%.
(d) Carr LP Maximum Total Debt to Carr LP Tangible FMV. As
of the last day of each calendar quarter, the Carr LP Maximum Total Debt Ratio
will not be greater than 60%.
(e) EBITDA Interest Coverage. As of the last day of each
calendar quarter, the ratio of (x) Annual EBITDA to (y) interest (whether
accrued, paid or capitalized) actually payable by either Borrower or the
Borrowers on its Debt for the previous four consecutive quarters including the
quarter then ended, will not be less than 2.25:1.
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(f) EBITDA Coverage. As of the last day of each calendar
quarter, the ratio of (x) Annual EBITDA to (y) the sum of (i) Debt Service plus
(ii) Capital Expenditures of the Borrowers for the previous four consecutive
quarters including the quarter then ended plus (iii) dividends or other payments
payable by Carr with respect to any preferred stock issued by Carr, will not be
less than 1.25:1.
(g) Dividends. Carr will not, as determined on an
aggregate annual basis, pay any dividends in excess of 90% of Carr's
consolidated FFO for such year. During the continuance of an Event of Default
under Section 6.1(a), Carr shall only pay those dividends necessary to maintain
its status as a real estate investment trust.
(h) Borrowers LTV Ratio. As of the last day of each
calendar quarter and as of the date of any New Acquisition, the Borrowers LTV
Ratio shall not exceed 50%, subject, however, to the Borrowers' rights to cure
pursuant to Section 2.10(a). Failure to restore compliance with this Section
5.8(h) in accordance with Section 2.10(a) shall be an immediate Event of
Default.
(i) Carr LTV Ratio. As of the last day of each calendar
quarter and as of the date of any New Acquisition, the Carr LTV Ratio shall not
exceed 50%, subject, however, to Carr's rights to cure pursuant to Section
2.10(d). Failure to restore compliance with this Section 5.8(i) in accordance
with Section 2.10(d) shall be an immediate Event of Default.
(j) Carr LP LTV Ratio. As of the last day of each calendar
quarter and as of the date of any New Acquisition, the Carr LP LTV Ratio shall
not exceed 50%, subject, however, to Carr LP's rights to cure pursuant to
Section 2.10(e). Failure to restore compliance with this Section 5.8(j) in
accordance with Section 2.10(e) shall be an immediate Event of Default.
(k) Unencumbered Asset Pool Properties Minimum Debt
Service Coverage. As of the last day of each calendar quarter, the Borrowers
shall be in compliance with the Unencumbered Asset Pool Properties Minimum Debt
Service Coverage, subject, however, to the Borrowers' rights to cure pursuant to
Section 2.10(c). Failure to restore compliance with this Section 5.8(k) in
accordance with Section 2.10(c) shall be an immediate Event of Default.
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(l) Minimum Consolidated Tangible Net Worth. The
Consolidated Tangible Net Worth will at no time be less the sum of (x)
$1,000,000,000 and (y) 90% of the Net Offering Proceeds from and after the date
hereof.
SECTION 5.9. Restriction on Fundamental Changes; Operation
and Control. (a) Carr shall carry on its business operations through Carr and
its Subsidiaries. Neither Borrower nor CarrAmerica LP shall enter into any
merger or consolidation, unless such Borrower or CarrAmerica LP, as applicable,
is the surviving entity, or liquidate, wind-up or dissolve (or suffer any
liquidation or dissolution), discontinue its business or convey, lease, sell,
transfer or otherwise dispose of, in one transaction or series of transactions,
all or any substantial part of its business or property, whether now or
hereafter acquired, hold an interest in any subsidiary which is not controlled
by such Borrower or CarrAmerica LP, as applicable, or enter into other business
lines, without the prior written consent of the Required Banks, except for (i)
joint ventures in which Carr's ownership interest shall be less than 15% of the
fair market value of the Real Property Assets owned by Carr as of the date
hereof and (ii) Carr Real Estate Services, Inc., Carr Development and
Construction, Inc. and any other similar service company. For purposes hereof,
"fair market value" shall mean the quotient of (x) Net Operating Income with
respect to the Real Property Assets owned by Carr as of the date hereof and
(y) the FMV Cap Rate.
(b) Neither Borrower nor CarrAmerica LP shall amend its
articles of incorporation, by-laws or agreement of limited partnership, as
applicable, in any material respect, without the Lead Agent's consent, which
shall not be unreasonably withheld.
SECTION 5.10. Changes in Business. The Borrowers and
CarrAmerica LP shall not enter into any business which is substantially
different from that conducted by the Borrowers and CarrAmerica LP on the Closing
Date after giving effect to the transactions contemplated by the Loan Documents.
SECTION 5.11. Fiscal Year; Fiscal Quarter. The Borrowers
and CarrAmerica LP shall not change their fiscal year or any of their fiscal
quarters.
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SECTION 5.12. Margin Stock. None of the proceeds of the
Loan will be used, directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of buying or carrying any Margin Stock.
SECTION 5.13. Sale of Unencumbered Asset Pool Properties.
Prior to the sale or transfer of any Unencumbered Asset Pool Property, the
applicable Borrower shall (i) deliver prior written notice to the Lead Agent and
the Banks, (ii) deliver to the Lead Agent and the Banks a certificate from its
Chief Financial Officer certifying that at the time of such sale or other
disposal (based on pro-forma calculations for the previous period assuming that
such Unencumbered Asset Pool Property was not an Unencumbered Asset Pool
Property for the relevant period) all of the covenants contained in Sections 5.8
through 5.14 and 5.16 through 5.21 are and after giving effect to the
transaction shall continue to be true and accurate in all respects, and (iii)
pay to the Lead Agent an amount equal to that required pursuant to Section
2.10(b).
SECTION 5.14. Liens; Release of Liens. Neither Borrower
nor any of their Subsidiaries shall at any time during the Term directly or
indirectly create, incur, assume or permit to exist any Lien for borrowed monies
or any other Lien other than Permitted Liens unless the same is being contested
in good faith and the same is discharged, bonded off or paid within thirty (30)
days of filing of such Lien, on or with respect to any Unencumbered Asset Pool
Property. Notwithstanding the foregoing, the Borrowers may obtain a release from
the terms of this Agreement of any Unencumbered Asset Pool Property provided
that such Borrower has complied with Section 2.10(b) and prior to or
simultaneously with such release (i) such Borrower shall pay to the Lead Agent
any amounts due pursuant to Section 2.10(b), and (ii) such Borrower delivers to
the Lead Agent and the Banks a certificate from its Chief Financial Officer
certifying that at the time of the release all of the covenants contained in
Sections 5.8 through 5.14 and 5.16 through 5.21 are and after giving effect to
the transaction shall continue to be true and accurate in all respects.
SECTION 5.15 Use of Proceeds. The Borrowers and
CarrAmerica LP shall use the proceeds of the Loans solely (i) to facilitate the
acquisition by Carr (either directly or indirectly through Subsidiaries) of real
properties (or interests therein) (the "New Acquisitions") which are office
80
buildings (it being understood that Carr LP may distribute, lend or otherwise
transfer the proceeds of a Tranche B Loan to Carr for such purpose, and that
Carr may distribute, lend or otherwise transfer the proceeds of a Tranche A Loan
(or the proceeds of a Tranche B Loan received from Carr LP) to a Subsidiary for
such purpose), (ii) for other purposes related to the acquisition of office
buildings (including, without limitation, the acquisition of property service
companies in connection therewith and the payment of fees and other costs
related to such acquisition), (iii) for working capital purposes, (iv) for
development and construction activities in accordance with Section 5.16 hereof
or (v) for additional investments in Omni Offices, Inc.
SECTION 5.16 Development Activities. Neither the Borrowers
nor CarrAmerica LP shall have invested more than an amount in the aggregate as
to all such Persons in any current development and construction activities,
equal to ten percent (10%) of Tangible FMV at any time other than (i)
development of "build-to-suit" improvements in excess of 85% pre-leased to
tenants (in connection with which the Borrowers and CarrAmerica LP shall have no
construction completion risk) or (ii) development in connection with the
expansion and/or repositioning or restoration following a casualty or
condemnation of existing improvements on Real Property Assets.
SECTION 5.17 Restrictions on Secured Debt. Neither of the
Borrowers nor CarrAmerica LP shall incur Debt secured by a Lien which in the
aggregate exceeds 30% of Tangible FMV.
SECTION 5.18. Carr's Status. Carr shall at all times (i)
remain a publicly traded company listed on the New York Stock Exchange, and (ii)
maintain its status as a self-directed and self-administered real estate
investment trust under the Internal Revenue Code.
SECTION 5.19 Certain Requirements for the Unencumbered
Asset Pool Properties. At all times, the Unencumbered Asset Pool Properties
Value of the Unencumbered Asset Pool Properties which are less than 85% leased
to tenants (including as leased any space for which a lease termination payment
has been made to either Borrower or CarrAmerica LP but only for the period for
which such payment shall cover the rental income for such space) shall not
comprise more than 20% of the Unencumbered Asset Pool Properties Value. In the
event that the requirements of this Section 5.19 are
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not satisfied, the Borrowers and CarrAmerica LP shall be prohibited from further
Borrowings unless such Borrower or CarrAmerica LP adds a New Acquisition or Real
Property Asset to the Unencumbered Asset Pool Properties in accordance with this
Agreement in order to restore compliance with the requirements of this
provision. Failure to restore compliance with the requirements of this Section
5.19 within 90 days of such non-compliance shall be an Event of Default.
SECTION 5.20 Hedging Requirements. The Borrowers and
CarrAmerica LP shall maintain "Interest Rate Hedges" (as defined below) on a
notional amount of the Debt of the Borrowers and CarrAmerica LP and their
Subsidiaries which, when added to the aggregate principal amount of the Debt of
the Borrowers, CarrAmerica LP and their Subsidiaries which bears interest at a
fixed rate, equals or exceeds 75% of the aggregate principal amount of all Debt
of the Borrowers and CarrAmerica LP and their Subsidiaries. "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 reasonably acceptable to the Lead Agent entered into by the Borrowers
and/or CarrAmerica LP and/or their Subsidiaries in order to provide protection
to, or minimize the impact upon, the Borrowers and/or CarrAmerica LP and/or such
Subsidiaries of increasing floating rates of interest applicable to Debt.
SECTION 5.21. Transfer of Real Property Assets. Neither
Carr nor CarrAmerica LP shall transfer its interest or any portion of any
interest in any Real Property Asset to Carr LP.
SECTION 5.22. CarrAmerica Realty GP Holdings, Inc. Carr
hereby covenants that at all times CarrAmerica Realty GP Holdings, Inc. shall
remain a wholly-owned Subsidiary of Carr.
ARTICLE VI
DEFAULTS
SECTION 6.1. Events of Default. If one or more of the
following events ("Events of Default") shall have occurred and be continuing:
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(a) either Borrower or CarrAmerica LP shall fail to pay
when due any principal of any Loan, or either Borrower or CarrAmerica LP shall
fail to pay when due any interest on any Loan, provided, however, that a
Borrower shall be entitled to a three (3) Domestic Business Day grace period
with respect thereto but only as to two (2) payments of interest during the
Term, or either Borrower or CarrAmerica LP shall fail to pay within three (3)
Domestic Business Days after the same is due any fees or other amounts payable
hereunder;
(b) either Borrower or CarrAmerica LP shall fail to
observe or perform any covenant contained in Sections 5.7(a), 5.8 to 5.19,
inclusive, or 5.21, subject to any applicable grace periods set forth therein;
(c) either Borrower or CarrAmerica LP shall fail to
observe or perform any covenant or agreement contained in this Agreement (other
than those covered by clause (a) or (b) above) for 30 days after written notice
thereof has been given to such Borrower or CarrAmerica LP by the Lead Agent;
(d) any representation, warranty, certification or
statement made by either Borrower or CarrAmerica LP in this Agreement or in any
certificate, financial statement or other document delivered pursuant to this
Agreement shall prove to have been incorrect in any material respect when made
(or deemed made);
(e) Either Borrower or CarrAmerica LP shall default in the
payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise) of any amount owing in respect of any
Recourse Debt or Debt guaranteed by such party (other than the Obligations and
provided that such Debt is in an aggregate amount of Ten Million Dollars
($10,000,000) or more) and such default shall continue beyond the giving of any
required notice and the expiration of any applicable grace period (as the same
may be extended by the applicable lender) and such default shall not be waived
by the applicable lender (which waiver shall serve to reinstate the applicable
loan), or either Borrower or CarrAmerica LP shall default in the performance or
observance of any obligation or condition with respect to any such Debt or any
other event shall occur or condition exist beyond the giving of any required
notice and the expiration of any applicable grace period (as the same may be
extended by the applicable lender), if in any such case the effect of such
default, event or condition is to accelerate the maturity
83
of any such Debt or to permit (without any further requirement of notice or
lapse of time) the holder or holders thereof, or any trustee or agent for such
holders, to accelerate the maturity of any such Debt and such default shall not
be waived by the applicable lender (which waiver shall serve to reinstate the
applicable loan), or any such Debt shall become or be declared to be due and
payable prior to its stated maturity other than as a result of a regularly
scheduled payment;
(f) either Borrower or CarrAmerica LP shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing;
(g) an involuntary case or other proceeding shall be
commenced against either Borrower or CarrAmerica LP seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for a
period of 60 days; or an order for relief shall be entered against either
Borrower under the federal bankruptcy laws as now or hereafter in effect;
(h) either Borrower or CarrAmerica LP shall default in its
obligations under any Loan Document other than this Agreement beyond any
applicable notice and grace periods;
(i) any member of the ERISA Group shall fail to pay when
due an amount or amounts aggregating in excess of $1,000,000 which it shall have
become liable to pay under Title IV of ERISA, or notice of intent to terminate a
Material Plan shall be filed under Title IV of ERISA by any member of the ERISA
Group, any plan administrator or any
84
combination of the foregoing, or the PBGC shall institute proceedings under
Title IV of ERISA to terminate, to impose liability (other than for premiums
under Section 4007 of ERISA) in respect of, or to cause a trustee to be
appointed to administer any Material Plan, or a condition shall exist by reason
of which the PBGC would be entitled to obtain a decree adjudicating that any
Material Plan must be terminated, or there shall occur a complete or partial
withdrawal from, or a default, within the meaning of Section 4219(c)(5) of
ERISA, with respect to, one or more Multiemployer Plans which could cause one or
more members of the ERISA Group to incur a current payment obligation in excess
of $1,000,000;
(j) one or more final nonappealable judgments or decrees
in an aggregate amount of six percent (6%) or more of the Consolidated Tangible
Net Worth as of such date shall be entered by a court or courts of competent
jurisdiction against either Borrower or CarrAmerica LP (other than any judgment
as to which, and only to the extent, a reputable insurance company has
acknowledged coverage of such claim in writing) and (i) any such judgments or
decrees shall not be stayed, discharged, paid, bonded or vacated within thirty
(30) days or (ii) enforcement proceedings shall be commenced by any creditor on
any such judgments or decrees;
(k) (i) any Environmental Claim shall have been asserted
against either Borrower, CarrAmerica LP or any Environmental Affiliate, (ii) any
release, emission, discharge or disposal of any Materials of Environmental
Concern shall have occurred, and such event is reasonably likely to form the
basis of an Environmental Claim against either Borrower, CarrAmerica LP or any
Environmental Affiliate, or (iii) either Borrower, CarrAmerica LP or the
Environmental Affiliates shall have failed to obtain any Environmental Approval
necessary for the ownership, or operation of its business, property or assets or
any such Environmental Approval shall be revoked, terminated, or otherwise cease
to be in full force and effect, in the case of clauses (i), (ii) or (iii) above,
if the existence of such condition has had or is reasonably likely to have a
Material Adverse Effect;
(l) during any consecutive two year period commencing on
or after the date hereof, individuals who at the beginning of such period
constituted the Board of Directors of Carr (together with any new directors
whose election by the Board of Directors or whose nomination for election by
Carr
85
stockholders was approved by a vote of at least a majority of the members of the
Board of Directors then in the office who either were members of the Board of
Directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the members of the Board of Directors then in office; or
(m) Carr shall cease at any time to qualify as a real
estate investment trust under the Internal Revenue Code.
SECTION 6.2. Rights and Remedies. (a) Upon the occurrence
of any Event of Default described in Sections 6.1(f) or (g), the unpaid
principal amount of, and any and all accrued interest on, the Loans and any and
all accrued fees and other Obligations hereunder shall automatically become
immediately due and payable, with all additional interest from time to time
accrued thereon and without presentation, demand, or protest or other
requirements of any kind (including, without limitation, valuation and
appraisement, diligence, presentment, notice of intent to demand or accelerate
and notice of acceleration), all of which are hereby expressly waived by the
Borrowers and CarrAmerica LP; and upon the occurrence and during the continuance
of any other Event of Default, the Lead Agent may exercise any of its rights and
remedies hereunder and by written notice to the Borrowers, declare the unpaid
principal amount of and any and all accrued and unpaid interest on the Loans and
any and all accrued fees and other Obligations hereunder to be, and the same
shall thereupon be, immediately due and payable with all additional interest
from time to time accrued thereon and without presentation, demand, or protest
or other requirements of any kind other than as provided in the Loan Documents
(including, without limitation, valuation and appraisement, diligence,
presentment, and notice of intent to demand or accelerate), all of which are
hereby expressly waived by the Borrowers and CarrAmerica LP. Notwithstanding
anything contained in this Agreement to the contrary, (i) Carr and CarrAmerica
LP shall be jointly and severally liable for all Obligations arising hereunder
in connection with the Tranche A Loans, (ii) Carr and Carr LP shall be jointly
and severally liable for all Obligations arising hereunder in connection with
the Tranche B Loans and (iii) Carr LP shall not be liable for any Borrowings
made by Carr or CarrAmerica LP pursuant to the terms hereof.
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(b) Notwithstanding the foregoing, upon the occurrence and
during the continuance of any Event of Default other than any Event of Default
described in Sections 6.1(f) or (g), the Lead Agent shall not exercise any of
its rights and remedies hereunder nor declare the unpaid principal amount of and
any and all accrued and unpaid intereon the Loans and any and all accrued fees
and other Obligations hereunder to be immediately due and payable, until such
time as the Lead Agent shall have delivered a notice to the Banks specifying the
Event of Default which has occurred and whether Lead Agent recommends the
acceleration of the Obligations due hereunder or the exercise of other remedies
hereunder. The Banks shall notify the Lead Agent if they approve or disapprove
of the acceleration of the Obligations due hereunder or the exercise of such
other remedy recommended by Lead Agent within five (5) Domestic Business Days
after receipt of such notice. If any Bank shall not respond within such five (5)
Domestic Business Day period, then such Bank shall be deemed to have accepted
Lead Agent's recommendation for acceleration of the Obligations due hereunder or
the exercise of such other remedy. If the Required Banks shall approve the
acceleration of the Obligations due hereunder or the exercise of such other
remedy, then Lead Agent shall declare the unpaid principal amount of and any and
all accrued and unpaid interest on the Loans and any and all accrued fees and
other Obligations hereunder to be immediately due and payable or exercise such
other remedy approved by the Required Banks. If the Required Banks shall neither
approve nor disapprove the acceleration of the Obligations due hereunder or such
other remedy recommended by Lead Agent, then Lead Agent may accelerate the
Obligations due hereunder or exercise any of its rights and remedies hereunder
in its sole discretion. If the Required Banks shall disapprove the acceleration
of the Obligations due hereunder or the exercise of such other remedy
recommended by Lead Agent, but approve of another remedy, then to the extent
permitted hereunder, Lead Agent shall exercise such remedy.
SECTION 6.3. Notice of Default. If the Lead Agent shall
not already have given any notice to the Borrowers under Section 6.1, the Lead
Agent shall give notice to the Borrowers under Section 6.1 promptly upon being
requested to do so by the Required Banks and shall thereupon notify all the
Banks thereof.
SECTION 6.4. Actions in Respect of Letters of Credit. (a)
If, at any time and from time to time, any Letter of
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Credit shall have been issued hereunder and an Event of Default shall have
occurred and be continuing, then, upon the occurrence and during the
continuation thereof, the Lead Agent may, whether in addition to the taking by
the Lead Agent of any of the actions described in this Article or otherwise,
make a demand upon the Borrowers to, and forthwith upon such demand (but in any
event within ten (10) days after such demand), the Borrowers and/or CarrAmerica
LP shall, pay to the Lead Agent, on behalf of the Banks, in same day funds at
the Lead Agent's office designated in such demand, for deposit in a special cash
collateral account (the "Letter of Credit Collateral Account") to be maintained
in the name of the Lead Agent (on behalf of the Banks) and under its sole
dominion and control at such place as shall be designated by the Lead Agent, an
amount equal to the amount of the Letter of Credit Usage under the Letters of
Credit. Interest shall accrue on the Letter of Credit Collateral Account at a
rate equal to the rate on overnight funds.
(b) The Borrowers and CarrAmerica LP hereby pledge, assign
and grant to the Lead Agent, as administrative agent for its benefit and the
ratable benefit of the Banks a lien on and a security interest in, the following
collateral (the "Letter of Credit Collateral"):
(i) the Letter of Credit Collateral Account, all cash
deposited therein and all certificates and instruments, if any, from
time to time representing or evidencing the Letter of Credit Collateral
Account;
(ii) all notes, certificates of deposit and other
instruments from time to time hereafter delivered to or otherwise
possessed by the Lead Agent for or on behalf of either Borrower or
CarrAmerica LP in substitution for or in respect of any or all of the
then existing Letter of Credit Collateral;
(iii) all interest, dividends, cash, instruments and other
property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the then
existing Letter of Credit Collateral; and
(iv) to the extent not covered by the above clauses, all
proceeds of any or all of the foregoing Letter of Credit Collateral.
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The lien and security interest granted hereby secures the payment of all
obligations of the Borrowers and CarrAmerica LP now or hereafter existing
hereunder and under any other Loan Document.
(c) The Borrowers and CarrAmerica LP hereby authorize the
Lead Agent for the ratable benefit of the Banks to apply, from time to time
after funds are deposited in the Letter of Credit Collateral Account, funds then
held in the Letter of Credit Collateral Account to the payment of any amounts,
in such order as the Lead Agent may elect, as shall have become due and payable
by the Borrowers and CarrAmerica LP to the Banks in respect of the Letters of
Credit.
(d) Neither Borrower, CarrAmerica LP nor any Person
claiming or acting on behalf of or through either Borrower or CarrAmerica LP
shall have any right to withdraw any of the funds held in the Letter of Credit
Collateral Account, except as provided in Section 6.4(h) hereof.
(e) Each Borrower and CarrAmerica LP agrees that it will
not (i) sell or otherwise dispose of any interest in the Letter of Credit
Collateral or (ii) create or permit to exist any lien, security interest or
other charge or encumbrance upon or with respect to any of the Letter of Credit
Collateral, except for the security interest created by this Section 6.4.
(f) If any Event of Default shall have occurred and be
continuing:
(i) The Lead Agent may, in its sole discretion,
without notice to the Borrowers or CarrAmerica LP except as required by
law and at any time from time to time, charge, set off or otherwise
apply all or any part of first, (x) amounts previously drawn on any
Letter of Credit that have not been reimbursed by the Borrowers or
CarrAmerica LP and (y) any Letter of Credit Usage described in clause
(ii) of the definition thereof that are then due and payable and
second, any other unpaid Obligations then due and payable against the
Letter of Credit Collateral Account or any part thereof, in such order
as the Lead Agent shall elect. The rights of the Lead Agent under this
Section 6.4 are in addition to any rights and remedies which any Bank
may have.
(ii) The Lead Agent may also exercise, in its sole
discretion, in respect of the Letter of Credit Collateral
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Account, in addition to the other rights and remedies provided herein
or otherwise available to it, all the rights and remedies of a secured
party upon default under the Uniform Commercial Code in effect in the
State of New York at that time.
(g) The Lead Agent shall be deemed to have exercised
reasonable care in the custody and preservation of the Letter of Credit
Collateral if the Letter of Credit Collateral is accorded treatment
substantially equal to that which the Lead Agent accords its own property, it
being understood that, assuming such treatment, the Lead Agent shall not have
any responsibility or liability with respect thereto.
(h) At such time as all Events of Default have been cured
or waived in writing, all amounts remaining in the Letter of Credit Collateral
Account shall be promptly returned to the Borrowers. Absent such cure or written
waiver, any surplus of the funds held in the Letter of Credit Collateral Account
and remaining after payment in full of all of the Obligations of the Borrowers
and CarrAmerica LP hereunder and under any other Loan Document after the
Maturity Date shall be paid to the Borrowers or to whomsoever may be lawfully
entitled to receive such surplus.
ARTICLE VII
THE LEAD AGENT
SECTION 7.1. Appointment and Authorization. Each Bank
irrevocably appoints and authorizes the Lead Agent to take such action as agent
on its behalf and to exercise such powers under this Agreement and the other
Loan Documents as are delegated to the Lead Agent by the terms hereof or
thereof, together with all such powers as are reasonably incidental thereto.
SECTION 7.2. Lead Agent and Affiliates. Morgan shall have
the same rights and powers under this Agreement as any other Bank and may
exercise or refrain from exercising the same as though it were not the Lead
Agent, and Morgan and its affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with the Borrowers and/or
CarrAmerica LP or any subsidiary or affiliate of the Borrowers or CarrAmerica LP
as if it were not the Lead Agent
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hereunder, and the term "Bank" and "Banks" shall include Morgan in its
individual capacity.
SECTION 7.3. Action by Lead Agent. The obligations of the
Lead Agent hereunder are only those expressly set forth herein. Without limiting
the generality of the foregoing, the Lead Agent shall not be required to take
any action with respect to any Default, except as expressly provided in Article
VI.
SECTION 7.4. Consultation with Experts. The Lead Agent may
consult with legal counsel (who may be counsel for the Borrowers or CarrAmerica
LP), independent public accountants and other experts selected by it and shall
not be liable for any action taken or omitted to be taken by it in good faith in
accordance with the advice of such counsel, accountants or experts.
SECTION 7.5. Liability of Lead Agent. Neither the Lead
Agent nor any of its affiliates nor any of their respective directors, officers,
agents or employees shall be liable for any action taken or not taken by it in
connection herewith (i) with the consent or at the request of the Required Banks
or, where required by the terms of this Agreement, all of the Banks, or (ii) in
the absence of its own gross negligence or willful misconduct. Neither the Lead
Agent nor any of its directors, officers, agents or employees shall be
responsible for or have any duty to ascertain, inquire into or verify (i) any
statement, warranty or representation made in connection with this Agreement or
any borrowing hereunder; (ii) the performance or observance of any of the
covenants or agreements of the Borrowers or CarrAmerica LP; (iii) the
satisfaction of any condition specified in Article III, except receipt of items
required to be delivered to the Lead Agent; or (iv) the validity, effectiveness
or genuineness of this Agreement, the other Loan Documents or any other
instrument or writing furnished in connection herewith. The Lead Agent shall not
incur any liability by acting in reliance upon any notice, consent, certificate,
statement, or other writing (which may be a bank wire, telex or similar writing)
believed by it in good faith to be genuine or to be signed by the proper party
or parties.
SECTION 7.6. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify the Lead Agent, its affiliates and
their respective directors, officers,
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agents and employees (to the extent not reimbursed by the Borrowers or
CarrAmerica LP) against any cost, expense (including counsel fees and
disbursements), claim, demand, action, loss or liability (except such as result
from such indemnitees' gross negligence or willful misconduct) that such
indemnitees may suffer or incur in connection with this Agreement, the other
Loan Documents or any action taken or omitted by such indemnitees hereunder.
SECTION 7.7. Credit Decision. Each Bank acknowledges that
it has, independently and without reliance upon the Lead Agent or any other
Bank, and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Agreement. Each
Bank also acknowledges that it will, independently and without reliance upon the
Lead Agent or any other Bank, and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking any action under this Agreement.
SECTION 7.8. Successor Lead Agent. The Lead Agent may
resign at any time by giving notice thereof to the Banks and the Borrowers. Upon
any such resignation or the removal of the Lead Agent in accordance with Section
7.11, the Required Banks shall have the right to appoint a successor Lead Agent.
If no successor Lead Agent shall have been so appointed by the Required Banks,
and shall have accepted such appointment, within 30 days after the retiring Lead
Agent gives notice of resignation, then the retiring Lead Agent may, on behalf
of the Banks, appoint a successor Lead Agent, which shall be a commercial bank
organized or licensed under the laws of the United States of America or of any
State thereof and having a combined capital and surplus of at least
$500,000,000. Upon the acceptance of its appointment as the Lead Agent hereunder
by a successor Lead Agent, such successor Lead Agent shall thereupon succeed to
and become vested with all the rights and duties of the retiring Lead Agent, and
the retiring Lead Agent shall be discharged from its duties and obligations
hereunder first accruing or arising after the effective date of such retirement.
After any retiring Lead Agent's resignation hereunder as Lead Agent, the
provisions of this Article shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was the Lead Agent.
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SECTION 7.9. Lead Agent's Fee. The Borrowers shall pay to
the Lead Agent for its own account fees in the amounts and at the times
previously agreed upon between the Borrowers and the Lead Agent.
SECTION 7.10. Copies of Notices. Lead Agent shall deliver
to each Bank a copy of any notice sent to either Borrower or CarrAmerica LP by
Lead Agent in connection with the performance of its duties as Lead Agent
hereunder.
SECTION 7.11. Removal of Lead Agent. If the Lead Agent
shall breach any of its material obligations under this Agreement, then, upon
the unanimous consent of all the Banks (other than the Lead Agent), the Lead
Agent may be removed as Lead Agent hereunder. Upon any such removal of the Lead
Agent in accordance with this Section 7.11, the Required Banks shall have the
right to appoint a successor Lead Agent in accordance with Section 7.8.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES
SECTION 8.1. Basis for Determining Interest Rate
Inadequate or Unfair. If on or prior to the first day of any Interest Period for
any Euro-Dollar Borrowing or Money Market LIBOR Borrowing:
(a) the Lead Agent is advised by the Reference Bank that
deposits in dollars (in the applicable amounts) are not being offered to the
Reference Bank in the relevant market for such Interest Period, or
(b) Banks having 50% or more of the aggregate amount of
the Commitments advise the Lead Agent that the Adjusted London Interbank Offered
Rate as determined by the Lead Agent will not adequately and fairly reflect the
cost to such Banks of funding their Euro-Dollar Loans for such Interest Period,
the Lead Agent shall forthwith give notice thereof to the Borrowers and the
Banks, whereupon until the Lead Agent notifies the Borrowers that the
circumstances giving rise to such suspension no longer exist, the obligations of
the Banks to make Euro-Dollar Loans shall be suspended. Unless the applicable
Borrower notifies the Lead Agent at least two Domestic Business Days before the
date of
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any Euro-Dollar Borrowing or Money Market LIBOR Borrowing for which a Notice of
Borrowing has previously been given that it elects not to borrow on such date,
(i) if such Borrowing is a Committed Borrowing, such Borrowing shall instead be
made as a Base Rate Borrowing and (ii) if such Borrowing is a Money Market LIBOR
Borrowing, the Money Market LIBOR Loans comprising such Borrowing shall bear
interest for each day from and including the first day to but excluding the last
day of the Interest Period applicable thereto at the Base Rate for such day.
SECTION 8.2. Illegality. If, after the date of this
Agreement, the adoption of any applicable law, rule or regulation, or any change
in any existing applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Euro-Dollar Lending Office) with any
request or directive (whether or not having the force of law) of any such
authority, central bank or comparable agency shall make it unlawful or
impossible for any Bank (or its Euro-Dollar Lending Office) to make, maintain or
fund its Euro-Dollar Loans or Money Market LIBOR Loans or to participate in any
Letter of Credit issued by the Fronting Bank or, with respect to the Fronting
Bank, to issue any Letters of Credit, and such Bank shall so notify the Lead
Agent, the Lead Agent shall forthwith give notice thereof to the other Banks and
the Borrowers, whereupon until such Bank notifies the Borrowers and the Lead
Agent that the circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to make Euro-Dollar Loans or Money Market LIBOR Loans or
to participate in any Letter of Credit issued by the Fronting Bank or, with
respect to the Fronting Bank, to issue any Letters of Credit, shall be
suspended. With respect to Euro-Dollar Loans or Money Market LIBOR Loans, before
giving any notice to the Lead Agent pursuant to this Section, such Bank shall
designate a different Euro-Dollar Lending Office if such designation will avoid
the need for giving such notice and will not, in the judgment of such Bank, be
otherwise disadvantageous to such Bank. If such Bank shall determine that it may
not lawfully continue to maintain and fund any of its outstanding Euro-Dollar
Loans or Money Market LIBOR Loans (as the case may be) to maturity and shall so
specify in such notice, the Borrowers and/or CarrAmerica LP shall immediately
prepay in full the then outstanding principal amount of each such Euro-Dollar
Loan
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or Money Market LIBOR Loan, together with accrued interest thereon. Concurrently
with prepaying each such Euro-Dollar Loan, the Borrowers shall borrow a Base
Rate Loan in an equal principal amount from such Bank (on which interest and
principal shall be payable contemporaneously with the related Euro-Dollar Loans
or Money Market LIBOR Loan of the other Banks), and such Bank shall make such a
Base Rate Loan.
SECTION 8.3. Increased Cost and Reduced Return.
(a) If on or after (x) the date hereof, in the case of any
Committed Loan or any obligation to make Committed Loans or (y) the date of the
applicable Money Market Quote, in the case of any Money Market Loan, the
adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Applicable Lending Office) with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency shall impose, modify or deem applicable any reserve
(including, without limitation, any such requirement imposed by the Board of
Governors of the Federal Reserve System (but excluding with respect to any
Euro-Dollar Loan any such requirement reflected in an applicable Euro-Dollar
Reserve Percentage)), special deposit, insurance assessment or similar
requirement against assets of, deposits with or for the account of, or credit
extended by, any Bank (or its Applicable Lending Office) or shall impose on any
Bank (or its Applicable Lending Office) or on the London interbank market any
other condition affecting its Euro-Dollar Loans or Money Market LIBOR Loans, its
Note, or its obligation to make Euro-Dollar Loans, and the result of any of the
foregoing is to increase the cost to such Bank (or its Applicable Lending
Office) of making or maintaining any such Loans, or to reduce the amount of any
sum received or receivable by such Bank (or its Applicable Lending Office) under
this Agreement or under its Note with respect thereto, by an amount deemed by
such Bank to be material, then, within 15 days after demand by such Bank (with a
copy to the Lead Agent), which demand shall be accompanied by a certificate
showing, in reasonable detail, the calculation of such amount or amounts, the
Borrowers and/or CarrAmerica LP shall pay to such Bank such additional amount or
amounts as will compensate such Bank for such increased cost or reduction.
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(b) If any Bank shall have determined that, after the date
hereof, the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any such law, rule or regulation, or any change in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on capital of such Bank (or its Parent) as a consequence of such Bank's
obligations hereunder to a level below that which such Bank (or its Parent)
could have achieved but for such adoption, change, request or directive (taking
into consideration its policies with respect to capital adequacy) by an amount
deemed by such Bank to be material, then from time to time, within 15 days after
demand by such Bank (with a copy to the Lead Agent), which demand shall be
accompanied by a certificate showing, in reasonable detail, the calculation of
such amount or amounts, the Borrowers and/or CarrAmerica LP shall pay to such
Bank such additional amount or amounts as will compensate such Bank (or its
Parent) for such reduction.
(c) Each Bank will promptly notify the Borrowers and
CarrAmerica LP and the Lead Agent of any event of which it has knowledge,
occurring after the date hereof, which will entitle such Bank to compensation
pursuant to this Section and will designate a different Applicable Lending
Office if such designation will avoid the need for, or reduce the amount of,
such compensation and will not, in the judgment of such Bank, be otherwise
disadvantageous to such Bank. A certificate of any Bank claiming compensation
under this Section and setting forth the additional amount or amounts to be paid
to it hereunder shall be conclusive in the absence of manifest error. In
determining such amount, such Bank may use any reasonable averaging and
attribution methods.
SECTION 8.4. Taxes.
(a) Any and all payments by the Borrowers or CarrAmerica
LP to or for the account of any Bank or the Lead Agent hereunder or under any
other Loan Document shall be made free and clear of and without deduction for
any and all present or future taxes, duties, levies, imposts, deductions,
charges or withholdings, and all liabilities with
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respect thereto, excluding, in the case of each Bank and the Lead Agent, taxes
imposed on its income, and franchise taxes imposed on it, by the jurisdiction
under the laws of which such Bank or the Lead Agent (as the case may be) is
organized or any political subdivision thereof and, in the case of each Bank,
taxes imposed on its income, and franchise or similar taxes imposed on it, by
the jurisdiction of such Bank's Applicable Lending Office or any political
subdivision thereof (and, if different from the jurisdiction of such Bank's
Applicable Lending Office, the jurisdiction of the domicile of its Loans either
established by the Bank pursuant to Section 9.12 or determined by the applicable
taxing authorities)(all such non-excluded taxes, duties, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If the Borrowers and/or CarrAmerica LP shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under any
Note or Letter of Credit or participation therein to any Bank or the Lead Agent,
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section 8.4) such Bank, the Fronting Bank or the Lead Agent (as the
case may be) receives an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrowers or CarrAmerica LP shall make such
deductions, (iii) the Borrowers or CarrAmerica LP shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law and (iv) the Borrowers or CarrAmerica LP shall furnish to
the Lead Agent, at its address referred to in Section 9.1, the original or a
certified copy of a receipt evidencing payment thereof.
(b) In addition, the Borrowers and CarrAmerica LP agree to
pay any present or future stamp or documentary taxes and any other excise or
property taxes, or charges or similar levies which arise from any payment made
hereunder or under any Note or Letter of Credit or participation therein or from
the execution or delivery of, or otherwise with respect to, this Agreement or
any Note or Letter of Credit or participation therein (hereinafter referred to
as "Other Taxes").
(c) The Borrowers and CarrAmerica LP agree to indemnify
each Bank, the Fronting Bank and the Lead Agent for the full amount of Taxes or
Other Taxes (including, without limitation, any Taxes or Other Taxes imposed or
asserted by
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any jurisdiction on amounts payable under this Section 8.4) paid by such Bank,
the Fronting Bank or the Lead Agent (as the case may be) and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto. This indemnification shall be made within 15 days from the date such
Bank, the Fronting Bank or the Lead Agent (as the case may be) makes demand
therefor.
(d) Each Bank organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and delivery
of this Agreement in the case of each Bank listed on the signature pages hereof
and on or prior to the date on which it becomes a Bank in the case of each other
Bank, and from time to time thereafter if requested in writing by the Borrowers
or CarrAmerica LP (but only so long as such Bank remains lawfully able to do
so), shall provide the Borrowers or CarrAmerica LP with Internal Revenue Service
form 1001 or 4224, as appropriate, or any successor form prescribed by the
Internal Revenue Service, certifying that such Bank is entitled to benefits
under an income tax treaty to which the United States is a party which reduces
the rate of withholding tax on payments of interest or certifying that the
income receivable pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States. If the form provided by a
Bank at the time such Bank first became a party to this Agreement or at any time
thereafter (other than solely by reason of a change in United States law or a
change in the terms of any treaty to which the United States is a party after
the date hereof) indicates a United States interest withholding tax rate in
excess of zero (or would have indicated such a withholding tax rate if such form
had been submitted and completed accurately and completely and either was not
submitted or was not completed accurately and completely), or if a Bank
otherwise is subject to United States interest withholding tax at a rate in
excess of zero at any time for any reason (other than solely by reason of a
change in United States law or regulation or a change in any treaty to which the
United States is a party after the date hereof), withholding tax at such rate
shall be considered excluded from "Taxes" as defined in Section 8.4(a). In
addition, any amount that otherwise would be considered "Taxes" or "Other Taxes"
for purposes of this Section 8.4 shall be excluded therefrom if the Bank either
has transferred the domicile of its Loans pursuant to Section 9.12 or
changed the Applicable Lending Office with respect to such
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Loans and such amount would not have been incurred had such transfer or change
not been made.
(e) For any period with respect to which a Bank has failed
to provide the Borrowers or CarrAmerica LP with the appropriate form pursuant to
Section 8.4(d) (unless such failure is due to a change in treaty, law or
regulation occurring subsequent to the date on which a form originally was
required to be provided), such Bank shall not be entitled to indemnification
under Section 8.4(a) with respect to Taxes imposed by the United States;
provided, however, that should a Bank, which is otherwise exempt from or subject
to a reduced rate of withholding tax, become subject to Taxes because of its
failure to deliver a form required hereunder, the Borrowers and CarrAmerica LP
shall take such steps as such Bank shall reasonably request to assist such Bank
to recover such Taxes.
(f) If the Borrowers or CarrAmerica LP are required to pay
additional amounts to or for the account of any Bank pursuant to this Section
8.4, then such Bank will change the jurisdiction of its Applicable Lending
Office so as to eliminate or reduce any such additional payment which may
thereafter accrue if such change, in the judgment of such Bank, is not otherwise
disadvantageous to such Bank.
SECTION 8.5. Base Rate Loans Substituted for Affected
Euro-Dollar Loans. If (i) the obligation of any Bank to make Euro-Dollar Loans
has been suspended pursuant to Sections 8.1 or 8.2 or (ii) any Bank has demanded
compensation under Section 8.3 or 8.4 with respect to its Euro-Dollar Loans and
the Borrowers shall, by at least five Euro-Dollar Business Days' prior notice to
such Bank through the Lead Agent, have elected that the provisions of this
Section shall apply to such Bank, then, unless and until such Bank notifies the
Borrowers that the circumstances giving rise to such suspension or demand for
compensation no longer exist:
(a) all Loans which would otherwise be made by such Bank
as Euro-Dollar Loans shall be made instead as Base Rate Loans (on which interest
and principal shall be payable contemporaneously with the related Euro-Dollar
Loans of the other Banks), and
(b) after each of its Euro-Dollar Loans has been repaid,
all payments of principal which would otherwise be
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applied to repay such Euro-Dollar Loans shall be applied to repay its Base Rate
Loans instead.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, facsimile transmission or similar writing) and shall be given to such
party: (x) in the case of the Borrowers, CarrAmerica LP or the Lead Agent, at
its address or telecopy number set forth on the signature pages hereof, together
with copies thereof, in the case of the Borrowers or CarrAmerica LP, to Hogan &
Hartson L.L.P., 555 13th Street, N.W., Washington, D.C. 20004, Attention: J.
Warren Gorrell, Jr., Esq., Telephone: (202) 637-5600, Telecopy: (202) 637-5910,
and in the case of the Lead Agent, to Skadden, Arps, Slate, Meagher & Flom LLP,
919 Third Avenue, New York, New York 10022, Attention: Martha Feltenstein, Esq.,
Telephone: (212) 735-2272, Telecopy: (212) 735-2000, (y) in the case of any
Bank, at its address or telecopy number set forth on the signature pages hereof
or in its Administrative Questionnaire or (z) in the case of any party, such
other address or telecopy number as such party may hereafter specify for the
purpose by notice to the Lead Agent, the Banks, the Borrowers and CarrAmerica
LP. Each such notice, request or other communication shall be effective (i) if
given by telecopy, when such telecopy is transmitted to the telecopy number
specified in this Section, (ii) if given by mail, 72 hours after such
communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid or (iii) if given by any other means, when delivered at
the address specified in this Section; provided that notices to the Lead Agent
under Article II or Article VIII shall not be effective until received.
SECTION 9.2. No Waivers. No failure or delay by the Lead
Agent or any Bank in exercising any right, power or privilege hereunder or under
any Note shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The
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rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
SECTION 9.3. Expenses; Indemnification.
(a) The Borrowers and CarrAmerica LP shall pay (i) all
reasonable out-of-pocket expenses of the Lead Agent (including, without
limitation, reasonable fees and disbursements of special counsel Skadden, Arps,
Slate, Meagher & Flom, local counsel for the Lead Agent, and travel,
environmental and engineering expenses), in connection with the preparation and
administration of this Agreement, the Loan Documents and the documents and
instruments referred to therein, the syndication of the Loans, any waiver or
consent hereunder or any amendment or modification hereof or any Default or
alleged Default hereunder and (ii) if an Event of Default occurs, all
out-of-pocket expenses incurred by the Lead Agent and each Bank, including,
without limitation, reasonable fees and disbursements of counsel for the Lead
Agent, in connection with the enforcement of the Loan Documents and the
instruments referred to therein and such Event of Default and collection,
bankruptcy, insolvency and other enforcement proceedings resulting therefrom.
(b) The Borrowers and CarrAmerica LP agree to indemnify
the Lead Agent and each Bank, their respective affiliates and the respective
directors, officers, agents and employees of the foregoing (each an
"Indemnitee") and hold each Indemnitee harmless from and against any and all
liabilities, losses, damages, costs and expenses of any kind, including, without
limitation, the reasonable fees and disbursements of counsel, which may be
incurred by such Indemnitee in connection with any investigative, administrative
or judicial proceeding (whether or not such Indemnitee shall be designated a
party thereto) that may at any time (including, without limitation, at any time
following the payment of the Obligations) be imposed on, asserted against or
incurred by any Indemnitee as a result of, or arising out of, or in any way
related to or by reason of, (i) any of the transactions contemplated by the Loan
Documents or the execution, delivery or performance of any Loan Document, (ii)
any violation by the Borrowers, CarrAmerica LP or the Environmental Affiliates
of any applicable Environmental Law, (iii) any Environmental Claim arising out
of the management, use, control, ownership or operation of property or assets by
the Borrowers, CarrAmerica LP or any of the Environmental Affiliates, including,
without limitation, all on-site and off-site
101
activities involving Materials of Environmental Concern, (iv) the breach of any
environmental representation or warranty set forth herein, (v) the grant to the
Lead Agent and the Banks of any Lien in any property or assets of the Borrowers
or CarrAmerica LP or any stock or other equity interest in the Borrowers or
CarrAmerica LP, and (vi) the exercise by the Lead Agent and the Banks of their
rights and remedies (including, without limitation, foreclosure) under any
agreements creating any such Lien (but excluding, as to any Indemnitee, any such
losses, liabilities, claims, damages, expenses, obligations, penalties, actions,
judgments, suits, costs or disbursements incurred solely by reason of (i) the
gross negligence or willful misconduct of such Indemnitee as finally determined
by a court of competent jurisdiction and (ii) any investigative, administrative
or judicial proceeding imposed or asserted against any Indemnitee by any bank
regulatory agency or by any equity holder of such Indemnitee). Carr and
CarrAmerica LP shall be jointly and severally liable for all Obligations arising
hereunder in connection with the Tranche A Loans and Carr and Carr LP shall be
jointly and severally liable for all Obligations arising hereunder in connection
with the Tranche B Loans. Notwithstanding the foregoing, Carr LP shall not be
liable for any Borrowings made by Carr pursuant to the terms hereof. The
Borrowers' and CarrAmerica LP's obligations under this Section shall survive the
termination of this Agreement and the payment of the Obligations.
(c) The Borrowers and CarrAmerica LP shall pay, and hold
the Lead Agent and each of the Banks harmless from and against, any and all
present and future U.S. stamp, recording, transfer and other similar foreclosure
related taxes with respect to the foregoing matters and hold the Lead Agent and
each Bank harmless from and against any and all liabilities with respect to or
resulting from any delay or omission (other than to the extent attributable to
such Bank) to pay such taxes.
SECTION 9.4. Sharing of Set-Offs. 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 and during the
continuance of any Event of Default, each Bank is hereby authorized at any time
or from time to time, without presentment, demand, protest or other notice of
any kind to the Borrowers, CarrAmerica LP or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and apply
any and all
102
deposits (general or special, time or demand, provisional or final), other than
deposits held for the benefit of third parties, and any other indebtedness at
any time held or owing by such Bank (including, without limitation, by branches
and agencies of such Bank wherever located) to or for the credit or the account
of the Borrowers or CarrAmerica LP against and on account of the Obligations of
the Borrowers or CarrAmerica LP then due and payable to such Bank under this
Agreement or under any of the other Loan Documents, including, without
limitation, all interests in Obligations purchased by such Bank. Each Bank
agrees that if it shall, by exercising any right of set-off or counterclaim or
otherwise, receive payment of a proportion of the aggregate amount of principal
and interest due with respect to any Note held by it or Letter of Credit
participated in by it, or, in the case of the Fronting Bank, Letter of Credit
issued by it, which is greater than the proportion received by any other Bank or
Letter of Credit issued or participated in by such other Bank, in respect of the
aggregate amount of principal and interest due with respect to any Note held by
such other Bank, the Bank receiving such proportionately greater payment shall
purchase such participations in the Notes held by the other Banks or Letter of
Credit issued or participated in by such other Bank, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks or Letter of Credit issued
or participated in by such other Banks shall be shared by the Banks pro rata;
provided that nothing in this Section shall impair the right of any Bank to
exercise any right of set-off or counterclaim it may have and to apply the
amount subject to such exercise to the payment of indebtedness of the Borrowers
or CarrAmerica LP other than their indebtedness under the Notes or the Letters
of Credit. The Borrowers and CarrAmerica LP agree, to the fullest extent they
may effectively do so under applicable law, that any holder of a participation
in a Note or Letter of Credit, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of set-off or counterclaim and other rights
with respect to such participation as fully as if such holder of a participation
were a direct creditor of the Borrowers or CarrAmerica LP in the amount of such
participation. Notwithstanding the foregoing, any Bank shall not exercise any
right of set-off or counterclaim or any similar right it may have against any
other indebtedness at any time held or owing by such Bank (including, without
limitation, by branches and agencies of such Bank wherever
103
located) to or for the credit or the account of Carr LP against and on account
of any Obligations of Carr (whether or not then due and payable) or to apply the
amount subject to such exercise to the payment of indebtedness or other
Obligations of Carr.
SECTION 9.5. Amendments and Waivers. Any provision of this
Agreement, the Notes, the Letters of Credit or other Loan Documents may be
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by the Borrowers and the Required Banks (and, if the rights or duties of
the Lead Agent are affected thereby, by the Lead Agent); provided that no such
amendment or waiver shall, unless signed by all the Banks, (i) increase or
decrease the Commitment of any Bank (except for a ratable decrease in the
Commitments of all Banks) or subject any Bank to any additional obligation, (ii)
reduce the principal of or rate of interest on any Loan or any fees specified
herein, including, without limitation, the waiver of any Default or Event of
Default in the payment of interest, principal or fees hereunder if such waiver
would result in a permanent reduction in the amount or change in the timing of
the payment of interest, principal or fees payable hereunder by Borrowers or
CarrAmerica LP, unless the Borrowers or CarrAmerica LP have cured such Default
or Event of Default and paid all amounts, including any default interest, due
hereunder at the time a request for consent is made by Lead Agent to the Banks
to the waiver of any Default or Event of Default in the payment of interest,
principal or fees hereunder, in which event only the consent of the Required
Banks to the waiver of such Default or Event of Default shall be required, (iii)
postpone the date fixed for any payment of principal of or interest on any Loan
or any fees hereunder or for any reduction or termination of any Commitment,
(iv) change the percentage of the Commitments or of the aggregate unpaid
principal amount of the Notes, or the number of Banks, which shall be required
for the Banks or any of them to take any action under this Section or any other
provision of this Agreement, or (v) amend the provisions of this Section 9.5.
Notwithstanding the foregoing, no amendment, waiver or consent shall, unless in
writing and signed by the Designating Lender on behalf of its Designated Lender
affected thereby, (a) subject such Designated Lender to any additional
obligations, (b) reduce the principal of, interest on, or other amounts due with
respect to, the Designated Lender Note made payable to such Designated Lender,
or (c) postpone any date fixed for any payment of principal of, or
104
interest on, or other amounts due with respect to the Designated Lender Note
made payable to the Designated Lender.
SECTION 9.6. Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns, except that the Borrowers may not assign or otherwise transfer any
of their rights under this Agreement or the other Loan Documents without the
prior written consent of all Banks.
(b) Any Bank may at any time grant to one or more banks or
other institutions (each a "Participant") participating interests in its
Commitment or any or all of its Loans. In the event of any such grant by a Bank
of a participating interest to a Participant, whether or not upon notice to the
Borrowers, CarrAmerica LP and the Lead Agent, such Bank shall remain responsible
for the performance of its obligations hereunder, and the Borrowers, CarrAmerica
LP and the Lead Agent shall continue to deal solely and directly with such Bank
in connection with such Bank's rights and obligations under this Agreement. Any
agreement pursuant to which any Bank may grant such a participating interest
shall provide that such Bank shall retain the sole right and responsibility to
enforce the obligations of the Borrowers and CarrAmerica LP hereunder including,
without limitation, the right to approve any amendment, modification or waiver
of any provision of this Agreement; provided that such participation agreement
may provide that such Bank will not agree to any modification, amendment or
waiver of this Agreement described in clause (i), (ii), (iii) or (iv) of Section
9.5 without the consent of the Participant. The Borrowers and CarrAmerica LP
agree that each Participant shall, to the extent provided in its participation
agreement, be entitled to the benefits of Article VIII with respect to its
participating interest. An assignment or other transfer which is not permitted
by subsection (c) or (d) below shall be given effect for purposes of this
Agreement only to the extent of a participating interest granted in accordance
with this subsection (b).
(c) Any Bank may at any time assign to one or more banks
or other institutions (each an "Assignee") all, or a proportionate part of all,
of its rights and obligations under this Agreement, the Notes and the other Loan
Documents, and such Assignee shall assume such rights and obli-
105
gations, pursuant to an Assignment and Assumption Agreement in substantially the
form of Exhibit C attached hereto executed by such Assignee and such transferor
Bank, with (and subject to) the subscribed consent of the Lead Agent and,
provided no Event of Default shall have occurred and be continuing, the
Borrowers, which consent shall not be unreasonably withheld or delayed. Upon
execution and delivery of such instrument and payment by such Assignee to such
transferor Bank of an amount equal to the purchase price agreed between such
transferor Bank and such Assignee, such Assignee shall be a Bank party to this
Agreement and shall have all the rights and obligations of a Bank with a
Commitment as set forth in such instrument of assumption, and the transferor
Bank shall be released from its obligations hereunder to a corresponding extent,
and no further consent or action by any party shall be required. Upon the
consummation of any assignment pursuant to this subsection (c), the transferor
Bank, the Lead Agent, the Borrowers and CarrAmerica LP, if applicable, shall
make appropriate arrangements so that, if required, a new Note or Notes are
issued to the Assignee. In connection with any such assignment, the transferor
Bank shall pay to the Lead Agent an administrative fee for processing such
assignment in the amount of $2,500. If the Assignee is not incorporated under
the laws of the United States of America or a state thereof, it shall deliver to
the Borrowers and the Lead Agent certification as to exemption from deduction or
withholding of any United States federal income taxes in accordance with Section
8.4.
(d) Any Bank (each, a "Designating Lender") may at any
time designate one Designated Lender to fund Money Market Loans on behalf of
such Designating Lender subject to the terms of this Section 9.6(d) and the
provisions in Section 9.6(b) and (c) shall not apply to such designation. No
Bank may designate more than one (1) Designated Lender at a time. The parties to
each such designation shall execute and deliver to the Lead Agent for its
acceptance a Designation Agreement in the form of Exhibit G hereto. Upon such
receipt of an appropriately completed Designation Agreement executed by a
Designating Lender and a designee representing that it is a Designated Lender,
the Lead Agent will accept such Designation Agreement and will give prompt
notice thereof to the Borrowers and CarrAmerica LP, whereupon, (i) the Borrower
shall execute and deliver to the Designating Bank a Designated Lender Note
payable to the order of the Designated Lender, (ii) from and after the effective
date
106
specified in the Designation Agreement, the Designated Lender shall become a
party to this Agreement with a right (subject to the provisions of Section
2.3(d)) to make Money Market Loans on behalf of its Designating Lender pursuant
to Section 2.3 after the Borrower has accepted a Money Market Loan (or portion
thereof) of the Designating Lender, and (iii) the Designated Lender shall not be
required to make payments with respect to any obligations in this Agreement
except to the extent of excess cash flow of such Designated Lender which is not
otherwise required to repay obligations of such Designated Lender which are then
due and payable; provided, however, that regardless of such designation and
assumption by the Designated Lender, the Designating Lender shall be and remain
obligated to the Borrower, the Co-Agents and the Banks for each and every of the
obligations of the Designating Lender and its related Designated Lender with
respect to this Agreement, including, without limitation, any indemnification
obligations under Section 7.6 hereof and any sums otherwise payable to the
Borrower by the Designated Lender. Each Designating Lender shall serve as the
administrative agent of the Designated Lender and shall on behalf of, and to the
exclusion of, the Designated Lender: (i) receive any and all payments made for
the benefit of the Designated Lender and (ii) give and receive all
communications and notices and take all actions hereunder, including, without
limitation, votes, approvals, waivers, consents and amendments under or relating
to this Agreement and the other Loan Documents. Any such notice, communication,
vote, approval, waiver, consent or amendment shall be signed by the Designating
Lender as administrative agent for the Designated Lender and shall not be signed
by the Designated Lender on its own behalf and shall be binding upon the
Designated Lender to the same extent as if signed by the Designated Lender on
its own behalf. The Borrower, the Lead Agent, the Co-Agents and the Banks may
rely thereon without any requirement that the Designated Lender sign or
acknowledge the same. No Designated Lender may assign or transfer all or any
portion of its interest hereunder or under any other Loan Document, other than
assignments to the Designating Lender which originally designated such
Designated Lender or otherwise in accordance with the provisions of Section 9.6
(b) and (c).
(e) Any Bank may at any time assign all or any portion of
its rights under this Agreement and its Note and the Letters of Credit
participated in by such Bank (as a Fronting Bank) or, in the case of the
Fronting Bank, issued by
107
it, to a Federal Reserve Bank. No such assignment shall release the transferor
Bank from its obligations hereunder.
(f) No Assignee, Participant or other transferee of any
Bank's rights shall be entitled to receive any greater payment under Section 8.3
or 8.4 than such Bank would have been entitled to receive with respect to the
rights transferred, unless such transfer is made with the Borrowers' prior
written consent or by reason of the provisions of Section 8.2, 8.3 or 8.4
requiring such Bank to designate a different Applicable Lending Office under
certain circumstances or at a time when the circumstances giving rise to such
greater payment did not exist.
SECTION 9.7. Governing Law; Submission to Jurisdiction.
(a) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE
CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW
YORK (WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING TO CONFLICTS OF
LAW).
(b) Any legal action or proceeding with respect to this
Agreement or any other Loan Document and any action for enforcement of any
judgment in respect thereof may be brought in the courts of the State of New
York or of the United States of America for the Southern District of New York,
and, by execution and delivery of this Agreement, each Borrower and CarrAmerica
LP hereby accepts for itself and in respect of its property, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
appellate courts from any thereof. Each Borrower and CarrAmerica LP irrevocably
consents to the service of process out of any of the aforementioned courts in
any such action or proceeding by the hand delivery, or mailing of copies thereof
by registered or certified mail, postage prepaid, to the applicable Borrower or
CarrAmerica LP at its address set forth below. Each Borrower and CarrAmerica LP
hereby irrevocably waives any objection which it may now or hereafter have to
the laying of venue of any of the afore said actions or proceedings arising out
of or in connection with this Agreement or any other Loan Document brought in
the courts referred to above 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
108
has been brought in an inconvenient forum. Nothing herein shall affect the right
of the Lead Agent, any Bank or any holder of a Note to serve process in any
other manner permitted by law or to commence legal proceedings or otherwise
proceed against the Borrowers or CarrAmerica LP in any other jurisdiction.
Section 9.8. Marshalling; Recapture. Neither the Lead
Agent nor any Bank shall be under any obligation to marshall any assets in favor
of the Borrowers, CarrAmerica LP or any other party or against or in payment of
any or all of the Obligations. To the extent any Bank receives any payment by or
on behalf of the Borrowers or CarrAmerica LP, which payment or any part thereof
is subsequently invalidated, declared to be fraudulent or preferential, set
aside or required to be repaid to either Borrower or CarrAmerica LP or its
estate, trustee, receiver, custodian or any other party under any bankruptcy
law, state or federal law, common law or equitable cause, then to the extent of
such payment or repayment, the Obligation or part thereof which has been paid,
reduced or satisfied by the amount so repaid shall be reinstated by the amount
so repaid and shall be included within the liabilities of the Borrowers and
CarrAmerica LP to such Bank as of the date such initial payment, reduction or
satisfaction occurred.
SECTION 9.9. Counterparts; Integration; Effectiveness.
This Agreement may be signed in any number of counterparts, each of which shall
be an original, with the same effect as if the signatures thereto and hereto
were upon the same instrument. This Agreement constitutes the entire agreement
and understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof. This Agreement shall become effective upon receipt by the Lead Agent of
counterparts hereof signed by each of the parties hereto (or, in the case of any
party as to which an executed counterpart shall not have been received, receipt
by the Lead Agent in form satisfactory to it of telegraphic, telex or other
written confirmation from such party of execution of a counterpart hereof by
such party).
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWERS,
CARRAMERICA LP, THE LEAD AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVE ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
109
SECTION 9.11. Survival. All indemnities set forth herein
shall survive the execution and delivery of this Agreement and the other Loan
Documents and the making and repayment of the Loans hereunder.
SECTION 9.12. Domicile of Loans. Subject to the provisions
of Article VIII, each Bank may transfer and carry its Loans at, to or for the
account of any domestic or foreign branch office, subsidiary or affiliate of
such Bank.
SECTION 9.13. Limitation of Liability. (a) No claim may be
made by the Borrowers, CarrAmerica LP or any other Person against the Lead Agent
or any Bank or the affiliates, directors, officers, employees, attorneys or
agent of any of them for any consequential or punitive damages in respect of any
claim for breach of contract or any other theory of liability arising out of or
related to the transactions contemplated by this Agreement or by the other Loan
Documents, or any act, omission or event occurring in connection therewith; and
each Borrower and CarrAmerica LP hereby waives, releases and agrees not to sue
upon any claim for any such damages, whether or not accrued and whether or not
known or suspected to exist in its favor.
(b) The Lead Agent or any Bank may look to all the assets
of the Borrowers and CarrAmerica LP in seeking to enforce the Borrowers' and
CarrAmerica LP's liability and obligations hereunder, and the lien of any
judgment against the Borrowers and CarrAmerica LP and any proceeding instituted
on, under or in connection with any Note or any of the other Loan Documents
shall extend to all property now or hereafter owned by the Borrowers and
CarrAmerica LP, except as set forth in Sections 6.2 and 9.3.
SECTION 9.14. Confidentiality.
Prior to the occurrence and continuance of an Event of
Default and except in connection with the sale or assignment or potential sale
or assignment of any Bank's Commitment or portion of its Commitment pursuant to
Section 9.6, each Bank agrees that it will use reasonable efforts, consistent
with its customary policies for maintaining information as confidential, not to
disclose without the prior consent of the Borrowers (other than to its
subsidiaries, directors, agents, employees, auditors, counsel or other
professional consultants, provided that each such recipient shall either agree
to be bound by the terms of
110
this Section 9.14 or is otherwise bound to keep such information confidential on
a similar basis pursuant to professional ethical obligations) any information
with respect to the Borrowers, CarrAmerica LP, any Subsidiary thereof or any of
their assets or properties which is furnished pursuant to this Agreement or any
Loan Documents and which is designated as confidential, provided that any Bank
may disclose any such information (a) that has become generally available to the
public (other than as a consequence of any Bank's breach of this Section 9.14),
(b) as may be required or appropriate in any report, statement or testimony
submitted to any local, state or federal regulatory body having or claiming to
have jurisdiction over such Bank, any nationally recognized rating agency or
similar organization, (c) as may be required or appropriate in response to any
summons or subpoena or in connection with any litigation, or (d) in order to
comply with any applicable law, order, regulation or ruling; provided, further
that in the case of the foregoing clauses (b), (c) and (d), such Bank shall use
reasonable efforts to give Carr prior notice of any such disclosure.
SECTION 9.15. Co-Agents. Bank of America National Trust
and Savings Association (successor by merger to Bank of America Illinois),
Commerzbank Aktiengesellschaft, New York Branch, Nationsbank, N.A. and Wells
Fargo Realty Advisors Funding Incorporated, each as Bank and as Co-Agent for the
Banks hereunder (collectively, the "Co-Agents") shall have no other rights,
obligations and liabilities under this Agreement except as any other Bank
hereunder. Each Bank shall, ratably in accordance with its Commitment, indemnify
the Co-Agents, their affiliates and their respective directors, officers, agents
and employees (to the extent not reimbursed by the Borrowers or CarrAmerica LP)
against any cost, expense (including counsel fees and disbursements), claim,
demand, action, loss or liability (except such as result from such indemnitees'
gross negligence or willful misconduct) that such indemnitees may suffer or
incur but solely in connection with any such claim that may result pursuant to
the Co-Agents acting as Co-Agents under this Agreement.
SECTION 9.16. No Bankruptcy Proceedings. Each of the
Borrower, the Banks, the Lead Agent, and the Co-Agents hereby agrees that it
will not institute against any Designated Lender or join any other Person in
instituting against any Designated Lender any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceeding under any federal or state
bankruptcy or similar law, until the later to occur of (i) one year and one day
after the payment in full of the latest maturing commercial paper note issued by
such Designated Lender and (ii) the Maturity Date.
111
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.
CARRAMERICA REALTY CORPORATION
By:
---------------------------------
Name:
Title:
1700 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Telecopy number: (202)638-0102
CARR REALTY, L.P.
By: CarrAmerica Realty
Corporation, General Partner
By:
-------------------------------
Name:
Title:
1700 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Telecopy number: (202)638-0102
CARRAMERICA REALTY, L.P.
By: CarrAmerica Realty GP
Holdings, Inc.,
General Partner
By:
---------------------------------
Name:
Title:
1700 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Telecopy number: (202)638-0102
Commitments
$50,000,000 MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By:
-----------------------------
Name:
Title:
$45,000,000 BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By:
-----------------------------
Name:
Title:
$45,000,000 COMMERZBANK AKTIENGESELLSCHAFT,
NEW YORK BRANCH
By:
-----------------------------
Name:
Title:
By:
-----------------------------
Name:
Title:
$45,000,000 NATIONSBANK, N.A.
By:
-----------------------------
Name:
Title:
$45,000,000 WELLS FARGO BANK, NATIONAL ASSOCIATION
By:
-----------------------------
Name:
Title:
$37,500,000 BAYERISCHE HYPOTHEKEN -UND WECHSEL-
BANK AKTIENGESELLSCHAFT, NEW YORK BRANCH
By:
-----------------------------
Name:
Title:
By:
-----------------------------
Name:
Title:
113
$37,500,000 PNC BANK, NATIONAL ASSOCIATION
By:
---------------------------
Name:
Title:
$30,000,000 WACHOVIA BANK, N.A.
By:
----------------------------
Name:
Title:
$25,000,000 BANK ONE, ARIZONA, NA
By:
-----------------------------
Name:
Title:
$25,000,000 CORESTATES BANK, N.A.
By:
-----------------------------
Name:
Title:
$25,000,000 THE SAKURA BANK, LIMITED
NEW YORK BRANCH
By:
-----------------------------
Name:
Title:
$25,000,000 SOCIETE GENERALE, A FRENCH BANKING
CORPORATION, ACTING THROUGH ITS
SOUTHWEST AGENCY
By:
------------------------------
Name:
Title:
114
$15,000,000 KREDIETBANK N.V.
By:
-----------------------------
Name:
Title:
By:
------------------------------
Name:
Title:
Total Commitments
$450,000,000
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Co-Agent
By:
-------------------------------
Name:
Title:
Bank of America National Trust
and Savings Association
Commercial Real Estate
Services Group
231 South LaSalle Street
Chicago, Illinois 60697
Attention: Megan McBride
Telecopy: (312)974-4970
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK, as Lead Agent
By:
--------------------------------
Name: Timothy O'Donovan
Title: Vice President
c/o J.P. Morgan Services Inc.
500 Stanton Christiana Road
Newark, DE 19713-2107
Attention: Nancy K. Dunbar
Telecopy: (302) 634-4222
115
Domestic and Euro-Currency
Lending Office:
c/o J.P. Morgan Services Inc.
500 Stanton Christiana Road
Newark, DE 19713-2107-
Attention: Kevin M. McCann
Telecopy: (302) 634-1852/1872
COMMERZBANK AKTIENGESELLSCHAFT,
NEW YORK BRANCH, as Co-Agent
By:
--------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
NATIONSBANK, N.A., as Co-Agent
By:
-------------------------------
Name:
Title:
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Co-Agent
By:
-------------------------------
Name:
Title:
EXHIBIT A-1
TRANCHE A NOTE
New York, New York
, 1997
For value received, CarrAmerica Realty Corporation, a Maryland
corporation (the "Borrower") and CarrAmerica Realty L.P., a Delaware limited
partnership ("CarrAmerica LP"), jointly and severally promise to pay to the
order of (the "Bank"), for the account of its Applicable Lending Office, the
unpaid principal amount of each Loan made by the Bank to the Borrower or
CarrAmerica LP pursuant to the Credit Agreement referred to below on the
Maturity Date. The Borrower and CarrAmerica LP jointly and severally promise to
pay interest on the unpaid principal amount of each such Loan on the dates and
at the rate or rates provided for in the Credit Agreement. All such payments of
principal and interest shall be made in lawful money of the United States in
Federal or other immediately available funds at the office of Morgan Guaranty
Trust Company of New York, 60 Wall Street, New York, New York.
All Loans made by the Bank, the respective types and
maturities thereof and all repayments of the principal thereof shall be recorded
by the Bank and, if the Bank so elects in connection with any transfer or
enforcement hereof, appropriate notations to evidence the foregoing information
with respect to each such Loan then outstanding may be endorsed by the Bank on
the schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof; provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower and
CarrAmerica LP hereunder or under the Credit Agreement.
This Note is one of the Tranche A Notes referred to in the
Second Amended and Restated Revolving Credit Agreement, dated as of September
15, 1997, among the Borrower, CarrAmerica LP, Carr Realty, L.P., the Banks
parties thereto, Morgan Guaranty Trust Company of New York, as Lead Agent, Bank
of America National Trust and Savings Association, Commerzbank
Aktiengesellschaft, New York Branch, Nationsbank, N.A., and Wells Fargo Bank,
National Association, each as Bank and as Co-Agent for the Banks (as the same
may be amended from time to time, the "Credit Agreement"). Terms defined in the
Credit Agreement are used herein with the same meanings. Reference is made to
the Credit Agreement for provisions for the prepayment hereof and the
acceleration of the maturity hereof.
1
CARRAMERICA REALTY CORPORATION
By:
----------------------------------
Name:
Title:
CARRAMERICA REALTY L.P.
By:
----------------------------------
Name:
Title:
2
Tranche A Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
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Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
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3
EXHIBIT A-2
TRANCHE B NOTE
New York, New York
, 1997
For value received, Carr Realty, L.P., a Delaware limited
partnership (the "Borrower") and CarrAmerica Realty Corporation, a Maryland
corporation ("Carr"), jointly and severally promise to pay to the order of (the
"Bank"), for the account of its Applicable Lending Office, the unpaid principal
amount of each Loan made by the Bank to the Borrower or Carr pursuant to the
Credit Agreement referred to below on the Maturity Date. The Borrower and Carr
jointly and severally promise to pay interest on the unpaid principal amount of
each such Loan on the dates and at the rate or rates provided for in the Credit
Agreement. All such payments of principal and interest shall be made in lawful
money of the United States in Federal or other immediately available funds at
the office of Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, New York.
All Loans made by the Bank, the respective types and
maturities thereof and all repayments of the principal thereof shall be recorded
by the Bank and, if the Bank so elects in connection with any transfer or
enforcement hereof, appropriate notations to evidence the foregoing information
with respect to each such Loan then outstanding may be endorsed by the Bank on
the schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof; provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower and
Carr hereunder or under the Credit Agreement.
This Note is one of the Tranche B Notes referred to in the
Second Amended and Restated Revolving Credit Agreement, dated as of September
15, 1997, among the Borrower, Carr, CarrAmerica Realty, L.P., the Banks parties
thereto, Morgan Guaranty Trust Company of New York, as Lead Agent, Bank of
America National Trust and Savings Association, Commerzbank Aktiengesellschaft,
New York Branch, Nationsbank, N.A., and Wells Fargo Bank, National Association,
each as Bank and as Co-Agent for the Banks (as the same may be amended from time
to time, the "Credit Agreement"). Terms defined in the Credit Agreement are used
herein with the same meanings. Reference is made to the Credit Agreement for
provisions for the prepayment hereof and the acceleration of the maturity
hereof.
4
CARR REALTY, L.P.
By:
--------------------------
Name:
Title:
CARRAMERICA REALTY CORPORATION
By:
-------------------------
Name:
Title:
5
Tranche B Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
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Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
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6
EXHIBIT A-3
TRANCHE A DESIGNATED LENDER NOTE
New York, New York
, 1997
For value received, CarrAmerica Realty Corporation, a Maryland
corporation (the "Borrower") and CarrAmerica Realty L.P., a Delaware limited
partnership ("CarrAmerica LP"), jointly and severally promise to pay to the
order of (the "Bank"), for the account of its Applicable Lending Office, the
unpaid principal amount of each Loan made by the Bank to the Borrower or
CarrAmerica LP pursuant to the Credit Agreement referred to below on the
Maturity Date. The Borrower and CarrAmerica LP jointly and severally promise to
pay interest on the unpaid principal amount of each such Loan on the dates and
at the rate or rates provided for in the Credit Agreement. All such payments of
principal and interest shall be made in lawful money of the United States in
Federal or other immediately available funds at the office of Morgan Guaranty
Trust Company of New York, 60 Wall Street, New York, New York.
All Loans made by the Bank, the respective types and
maturities thereof and all repayments of the principal thereof shall be recorded
by the Bank and, if the Bank so elects in connection with any transfer or
enforcement hereof, appropriate notations to evidence the foregoing information
with respect to each such Loan then outstanding may be endorsed by the Bank on
the schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof; provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower and
CarrAmerica LP hereunder or under the Credit Agreement.
This Note is one of the Designated Lender Notes referred to
in, and is delivered pursuant to and subject to all of the terms of, the Second
Amended and Restated Revolving Credit Agreement dated as of September 15, 1997
among the Borrower, Carr, CarrAmerica LP, Carr Realty L.P., the Banks parties
thereto, Morgan Guaranty Trust Company of New York, as Lead Agent, Bank of
America National Trust and Savings Association, Commerzbank Aktiengesellschaft,
New York Branch, Nationsbank, N.A., and Wells Fargo Bank, National Association,
each as Bank and as Co-Agent for the Banks (as the same may be amended from time
to time, the "Credit Agreement"). Terms defined in the Credit Agreement are used
herein with the same meanings. Reference is made to the Credit Agreement for
provisions for the prepayment hereof and the acceleration of the maturity
hereof.
7
CARRAMERICA REALTY CORPORATION
By:
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Name:
Title:
CARRAMERICA REALTY L.P.
By:
-----------------------------
Name:
Title:
8
Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
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Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
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9
EXHIBIT A-4
TRANCHE B DESIGNATED LENDER NOTE
New York, New York
, 1997
For value received, Carr Realty, L.P., a Delaware limited
partnership (the "Borrower") and CarrAmerica Realty Corporation, a Maryland
corporation ("Carr"), jointly and severally promise to pay to the order of (the
"Bank"), for the account of its Applicable Lending Office, the unpaid principal
amount of each Loan made by the Bank to the Borrower or Carr pursuant to the
Credit Agreement referred to below on the Maturity Date. The Borrower and Carr
jointly and severally promise to pay interest on the unpaid principal amount of
each such Loan on the dates and at the rate or rates provided for in the Credit
Agreement. All such payments of principal and interest shall be made in lawful
money of the United States in Federal or other immediately available funds at
the office of Morgan Guaranty Trust Company of New York, 60 Wall Street, New
York, New York.
All Loans made by the Bank, the respective types and
maturities thereof and all repayments of the principal thereof shall be recorded
by the Bank and, if the Bank so elects in connection with any transfer or
enforcement hereof, appropriate notations to evidence the foregoing information
with respect to each such Loan then outstanding may be endorsed by the Bank on
the schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof; provided that the failure of the Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower and
Carr hereunder or under the Credit Agreement.
This Note is one of the Designated Lender Notes referred to
in, and is delivered pursuant to and subject to all of the terms of, the Second
Amended and Restated Revolving Credit Agreement dated as of September 15, 1997
among the Borrower, Carr, CarrAmerica Realty, L.P., the Banks parties thereto,
Morgan Guaranty Trust Company of New York, as Lead Agent, Bank of America
National Trust and Savings Association, Commerzbank Aktiengesellschaft, New York
Branch, Nationsbank, N.A., and Wells Fargo Bank, National Association, each as
Bank and as Co- Agent for the Banks (as the same may be amended from time to
time, the "Credit Agreement"). Terms defined in the Credit Agreement are used
herein with the same meanings. Reference is made to the Credit Agreement for
provisions for the prepayment hereof and the acceleration of the maturity
hereof.
10
CARR REALTY, L.P.
By:
-----------------------------
Name:
Title:
CARRAMERICA REALTY CORPORATION
By:
----------------------------
Name:
Title:
11
Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
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Amount of
Amount of Type of Principal Maturity Notation
Date Loan Loan Repaid Date Made By
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12
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS............. 2
SECTION 1.1. Definitions.......................................... 2
SECTION 1.2. Accounting Terms and Determinations.................. 30
SECTION 1.3. Types of Borrowings.................................. 30
ARTICLE II
THE CREDITS............. 31
SECTION 2.1. Commitments to Lend.................................. 31
SECTION 2.2. Notice of Committed Borrowing........................ 32
SECTION 2.3. Money Market Borrowings.............................. 34
SECTION 2.4. Notice to Banks; Funding of Loans.................... 40
SECTION 2.5. Notes................................................ 41
SECTION 2.6. Maturity of Loans.................................... 42
SECTION 2.7. Interest Rates....................................... 42
SECTION 2.8. Fees................................................. 45
SECTION 2.9. Mandatory Termination................................ 46
SECTION 2.10. Mandatory Prepayment................................ 46
SECTION 2.11. Optional Prepayments................................ 48
SECTION 2.12. General Provisions as to Payments................... 50
SECTION 2.13. Funding Losses...................................... 51
SECTION 2.14. Computation of Interest and Fees.................... 52
SECTION 2.15. Method of Electing Interest Rates................... 52
SECTION 2.16. Letters of Credit................................... 54
SECTION 2.17. Letter of Credit Usage Absolute..................... 57
ARTICLE III
CONDITIONS.............. 58
SECTION 3.1. Closing.............................................. 58
SECTION 3.2. Borrowings........................................... 61
SECTION 3.3 New Acquisitions..................................... 62
ARTICLE IV
REPRESENTATIONS AND WARRANTIES.... 62
SECTION 4.1. Existence and Power of Carr.......................... 63
SECTION 4.2. Existence and Power of Carr LP and CarrAmerica LP.... 63
SECTION 4.3. Power and Authority of Carr.......................... 63
SECTION 4.4. Power and Authority of Carr LP....................... 63
SECTION 4.5. No Violation......................................... 64
SECTION 4.6. Financial Information................................ 64
SECTION 4.7. Litigation........................................... 65
SECTION 4.8. Compliance with ERISA................................ 65
SECTION 4.9. Environmental Matters................................ 66
SECTION 4.10. Taxes................................................ 66
SECTION 4.11. Full Disclosure...................................... 67
SECTION 4.12. Solvency......................... ................... 67
SECTION 4.13. Use of Proceeds; Margin Regulations.. ............... 67
1
SECTION 4.14. Governmental Approvals.............................. 67
SECTION 4.15. Investment Company Act; Public Utility
Holding Company Act............................... 68
SECTION 4.16. Closing Date Transactions........................... 68
SECTION 4.17. Representations and Warranties in Loan
Documents......................................... 68
SECTION 4.18. Patents, Trademarks, etc............................ 68
SECTION 4.19. No Default.......................................... 69
SECTION 4.20. Licenses, etc....................................... 69
SECTION 4.21. Compliance With Law................................. 69
SECTION 4.22. No Burdensome Restrictions.......................... 69
SECTION 4.23. Brokers' Fees....................................... 69
SECTION 4.24. Labor Matters....................................... 70
SECTION 4.25. Organizational Documents............................ 70
SECTION 4.26. Principal Offices................................... 70
SECTION 4.27. REIT Status......................................... 70
SECTION 4.28. Ownership of Property............................... 70
SECTION 4.29. Insurance........................................... 71
ARTICLE V
AFFIRMATIVE AND NEGATIVE COVENANTS.......71
SECTION 5.1. Information.......................................... 71
SECTION 5.2. Payment of Obligations............................... 75
SECTION 5.3. Maintenance of Property.............................. 76
SECTION 5.4. Conduct of Business.................................. 76
SECTION 5.5. Compliance with Laws................................. 76
SECTION 5.6. Inspection of Property, Books and Records............ 76
SECTION 5.7. Existence............................................ 77
SECTION 5 Financial Covenants.................................. 77
SECTION 5.9. Restriction on Fundamental Changes................... 79
SECTION 5.10. Changes in Business.................................. 79
SECTION 5.11. Fiscal Year; Fiscal Quarter.......................... 79
SECTION 5.12. Margin Stock......................................... 80
SECTION 5.13. Sale of Unencumbered Asset Pool Properties........... 80
SECTION 5.14. Liens................................................ 80
SECTION 5.15 Use of Proceeds...................................... 80
SECTION 5.16 Development Activities............................... 81
SECTION 5.17 Restrictions on Secured Debt......................... 81
SECTION 5.18. Carr's Status........................................ 81
SECTION 5.19 Certain Requirements for the Unencumbered
Asset Pool Properties.............................. 81
SECTION 5.20 Hedging Requirements................................. 82
SECTION 5.21. Transfer of Real Property Assets..................... 82
SECTION 5.22. CarrAmerica Realty GP Holdings, Inc.................. 82
ARTICLE VI
2
DEFAULTS......................... 82
SECTION 6.1. Events of Default.................................... 82
SECTION 6.2. Rights and Remedies.................................. 86
SECTION 6.3. Notice of Default.................................... 87
SECTION 6.4. Actions in Respect of Letters of Credit.............. 87
ARTICLE VII
THE LEAD AGENT................... 90
SECTION 7.1. Appointment and Authorization........................ 90
SECTION 7.2. Lead Agent and Affiliates............................ 90
SECTION 7.3. Action by Lead Agent................................. 91
SECTION 7.4. Consultation with Experts............................ 91
SECTION 7.5. Liability of Lead Agent.............................. 91
SECTION 7.6. Indemnification...................................... 91
SECTION 7.7. Credit Decision...................................... 92
SECTION 7.8. Successor Lead Agent................................. 92
SECTION 7.9. Lead Agent's Fee..................................... 93
SECTION 7.10. Copies of Notices.................................... 93
SECTION 7.11. Removal of Lead Agent................................ 93
ARTICLE VIII
CHANGE IN CIRCUMSTANCES.......... 93
SECTION 8.1. Basis for Determining Interest Rate Inadequate
or Unfair.......................................... 93
SECTION 8.2. Illegality........................................... 94
SECTION 8.3. Increased Cost and Reduced Return.................... 95
SECTION 8.4. Taxes................................................ 96
SECTION 8.5. Base Rate Loans Substituted for Affected
Euro-Dollar Loans.................................. 99
ARTICLE IX
MISCELLANEOUS................... 100
SECTION 9.1. Notices............................................. 100
SECTION 9.2. No Waivers.......................................... 100
SECTION 9.3. Expenses; Indemnification........................... 101
SECTION 9.4. Sharing of Set-Offs................................. 102
SECTION 9.5. Amendments and Waivers.............................. 104
SECTION 9.6. Successors and Assigns.............................. 105
SECTION 9.7. Governing Law; Submission to Jurisdiction .......... 108
Section 9.8. Marshalling; Recapture.............................. 109
SECTION 9.9. Counterparts; Integration; Effectiveness............ 109
SECTION 9.10. WAIVER OF JURY TRIAL................................ 109
SECTION 9.11. Survival............................................ 110
SECTION 9.12. Domicile of Loans................................... 110
SECTION 9.13. Limitation of Liability............................. 110
SECTION 9.14. Confidentiality..................................... 110
SECTION 9.15. Co-Agents........................................... 111
SECTION 9.16. No Bankruptcy Proceedings........................... 111
3
Exhibit A-1 Form of Tranche A Note
Exhibit A-2 Form of Tranche B Note
Exhibit A-3 Form of Tranche A Designated Lender Note
Exhibit A-4 Form of Tranche B Designated Lender Note
4