REVOLVING LOAN AGREEMENT
Dated as of June 2, 1997
among
ALEXANDRIA REAL ESTATE EQUITIES, INC.
ARE - QRS CORP.
ARE ACQUISITIONS, LLC
THE BANKS HEREIN NAMED
and
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION, as Managing Agent
TABLE OF CONTENTS
PAGE
Article 1 DEFINITIONS AND ACCOUNTING TERMS................................ 1
1.1 Defined Terms................................................... 1
1.2 Use of Defined Terms............................................ 31
1.3 Accounting Terms................................................ 31
1.4 Rounding........................................................ 32
1.5 Exhibits and Schedules.......................................... 32
1.6 References to "Borrowers and their Subsidiaries"................ 32
1.7 Miscellaneous Terms............................................. 32
Article 2 LOANS........................................................... 33
2.1 Committed Loans-General......................................... 33
2.2 Alternate Base Rate Loans....................................... 35
2.3 Eurodollar Rate Loans........................................... 35
2.4 Competitive Advances............................................ 35
2.5 Voluntary Reduction of Commitments.............................. 39
2.6 Automatic Reduction of Commitments.............................. 39
2.7 Optional Termination of Commitments............................. 40
2.8 Managing Agent's Right to Assume Funds Available for Advances... 40
2.9 Extension of Revolver Termination Date.......................... 40
2.10 Term Loan Conversion............................................ 42
2.11 Unencumbered Asset Pool......................................... 42
2.12 Representative of Borrowers..................................... 43
Article 3 PAYMENTS AND FEES............................................... 44
3.1 Principal and Interest.......................................... 44
3.2 Arrangement Fee................................................. 46
3.3 Line B Commitment Activation Fee................................ 46
3.4 Commitment Fee.................................................. 46
3.5 Agency Fee...................................................... 46
3.6 Extension Fees.................................................. 46
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3.7 Increased Commitment Costs...................................... 47
3.8 Eurodollar Costs and Related Matters............................ 47
3.9 Late Payments................................................... 51
3.10 Computation of Interest and Fees................................ 52
3.11 Non-Banking Days................................................ 52
3.12 Manner and Treatment of Payments................................ 52
3.13 Funding Sources................................................. 53
3.14 Failure to Charge Not Subsequent Waiver......................... 54
3.15 Managing Agent's Right to Assume Payments Will be Made by
Borrowers....................................................... 54
3.16 Fee Determination Detail........................................ 54
3.17 Survivability................................................... 54
Article 4 REPRESENTATIONS AND WARRANTIES.................................. 55
4.1 Existence and Qualification; Power; Compliance With Laws........ 55
4.2 Authority; Compliance With Other Agreements and Instruments and
Government Regulations.......................................... 55
4.3 No Governmental Approvals Required.............................. 56
4.4 Subsidiaries.................................................... 56
4.5 Financial Statements............................................ 56
4.6 No Other Liabilities; No Material Adverse Changes............... 57
4.7 Title to Property............................................... 57
4.8 Intangible Assets............................................... 57
4.9 Public Utility Holding Company Act.............................. 57
4.10 Litigation...................................................... 57
4.11 Binding Obligations............................................. 58
4.12 No Default...................................................... 58
4.13 ERISA........................................................... 58
4.14 Regulations G and U; Investment Company Act..................... 59
4.15 Disclosure...................................................... 59
4.16 Tax Liability................................................... 59
4.17 Hazardous Materials............................................. 59
4.18 Initial Pool Properties......................................... 60
Article 5 AFFIRMATIVE COVENANTS (OTHER THAN INFORMATION AND REPORTING
REQUIREMENTS)................................................... 61
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5.1 Payment of Taxes and Other Potential Liens...................... 61
5.2 Preservation of Existence....................................... 61
5.3 Maintenance of Properties....................................... 61
5.4 Maintenance of Insurance........................................ 61
5.5 Compliance With Laws............................................ 62
5.6 Inspection Rights............................................... 62
5.7 Keeping of Records and Books of Account......................... 62
5.8 Compliance With Agreements...................................... 62
5.9 Use of Proceeds................................................. 62
5.10 Hazardous Materials Laws........................................ 62
5.11 Unencumbered Asset Pool......................................... 63
5.12 REIT Status..................................................... 63
5.13 Additional Borrowers............................................ 63
Article 6 NEGATIVE COVENANTS.............................................. 64
6.1 Mergers......................................................... 64
6.2 ERISA........................................................... 64
6.3 Change in Nature of Business.................................... 64
6.4 Transactions with Affiliates.................................... 64
6.5 Leverage Ratio.................................................. 64
6.6 Interest Coverage............................................... 65
6.7 Fixed Charge Coverage........................................... 65
6.8 Distributions................................................... 65
6.9 Market Net Worth................................................ 65
6.10 Undeveloped Property............................................ 65
6.11 Unencumbered Revenue-Producing Property......................... 65
6.12 Secured Recourse Debt........................................... 65
6.13 Other Unsecured Debt............................................ 65
6.14 Investments in Certain Persons.................................. 66
6.15 Negative Pledges................................................ 66
Article 7 INFORMATION AND REPORTING REQUIREMENTS.......................... 67
7.1 Financial and Business Information.............................. 67
7.2 Compliance Certificates......................................... 70
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Article 8 CONDITIONS...................................................... 71
8.1 Initial Advances................................................ 71
8.2 Any Advance..................................................... 73
Article 9 EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT............ 74
9.1 Events of Default............................................... 74
9.2 Remedies Upon Event of Default.................................. 76
Article 10 THE MANAGING AGENT.............................................. 79
10.1 Appointment and Authorization................................... 79
10.2 Managing Agent and Affiliates................................... 79
10.3 Proportionate Interest in any Collateral........................ 79
10.4 Banks' Credit Decisions......................................... 80
10.5 Action by Managing Agent........................................ 80
10.6 Liability of Managing Agent..................................... 81
10.7 Indemnification................................................. 82
10.8 Successor Managing Agent........................................ 83
10.9 No Obligations of Borrowers..................................... 84
Article 11 MISCELLANEOUS................................................... 85
11.1 Cumulative Remedies; No Waiver.................................. 85
11.2 Amendments; Consents............................................ 85
11.3 Costs, Expenses and Taxes....................................... 86
11.4 Nature of Banks' Obligations.................................... 87
11.5 Survival of Representations and Warranties...................... 87
11.6 Notices......................................................... 87
11.7 Execution of Loan Documents..................................... 88
11.8 Binding Effect; Assignment...................................... 88
11.9 Right of Setoff................................................. 91
11.10 Sharing of Setoffs.............................................. 91
11.11 Indemnity by Borrowers.......................................... 92
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11.12 Nonliability of the Banks....................................... 93
11.13 No Third Parties Benefited...................................... 94
11.14 Confidentiality................................................. 94
11.15 Further Assurances.............................................. 95
11.16 Integration..................................................... 95
11.17 Governing Law................................................... 95
11.18 Severability of Provisions...................................... 95
11.19 Headings........................................................ 96
11.20 Time of the Essence............................................. 96
11.21 Foreign Banks and Participants.................................. 96
11.22 Hazardous Material Indemnity.................................... 97
11.23 Joint and Several............................................... 97
11.24 Removal of a Bank............................................... 98
11.25 Waiver of Right to Trial by Jury................................ 98
11.26 Purported Oral Amendments....................................... 99
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EXHIBITS
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A - Commitments Assignment and Acceptance
B - Competitive Advance Note
C - Competitive Bid
D - Competitive Bid Request
E - Compliance Certificate
F - Joinder Agreement
G - Line A Note
H - Line B Note
I-1 - Opinion of Counsel
I-2 - Opinion of Counsel
I-3 - Opinion of Counsel
J - Pricing Certificate
K - Request for Loan
L - Joint Borrower Provisions
SCHEDULES
- ---------
1.1 Bank Commitments
4.4 Subsidiaries
4.7 Existing Liens, Negative Pledges and Rights of Others
4.10 Material Litigation
4.17 Hazardous Materials Matters
4.18 Initial Pool Properties
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REVOLVING LOAN AGREEMENT
Dated as of June 2, 1997
This REVOLVING LOAN AGREEMENT ("Agreement") is entered into by and among
Alexandria Real Estate Equities, Inc., a Maryland corporation ("Parent"),
ARE-QRS Corp., a Maryland corporation ("QRS"), ARE Acquisitions, LLC, a
Delaware limited liability company ("ARE"), each other Wholly-Owned
Subsidiary of Parent which may hereafter become a party to this Agreement as
a borrower pursuant to Section 5.13 (collectively, with Parent, QRS and ARE,
the "Borrowers", all on a joint and several basis), each bank whose name is
set forth on the signature pages of this Agreement and each lender which may
hereafter become a party to this Agreement pursuant to Section 11.8
(collectively, the "Banks" and individually, a "Bank"), and Bank of America
National Trust and Savings Association, as Managing Agent.
In consideration of the mutual covenants and agreements herein contained, the
parties hereto covenant and agree as follows:
Article 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 DEFINED TERMS. As used in this Agreement, the following
terms shall have the meanings set forth below:
"ACTIVATED LINE B COMMITMENT" means, as of any date of
determination, the portion of the Line B Commitment which has been
activated pursuant to Section 2.1(b) as of that date.
"ADJUSTED EBITDA" means, with respect to any fiscal period, the SUM
OF (a) the Net Income of Parent for that period, PLUS (b) any
non-operating non-recurring loss reflected in such Net Income, MINUS (c)
any non-operating non-recurring gain reflected in such Net Income, PLUS
(d) Interest Expense of Parent for that period, PLUS (e) the aggregate
amount of federal and state taxes on or measured by income of Parent for
that period (whether or not payable during that period), PLUS (f)
depreciation, amortization and all other non-cash
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expenses (INCLUDING non-cash officer compensation) of Parent for that
period, in each case as determined in accordance with Generally Accepted
Accounting Principles, and ADJUSTED BY SUBTRACTING therefrom a property
expenditure reserve equal to 22% of the rental revenues of Parent for
that period that arise from or are related to Revenue-Producing Property
of Parent.
"ADJUSTED NOI" means, with respect to any Revenue-Producing Property
and with respect to any fiscal period, the SUM OF (a) the net income of
that Revenue-Producing Property for that period, PLUS (b) Interest
Expense of that Revenue-Producing Property for that period, PLUS (c) the
aggregate amount of federal and state taxes on or measured by income of
that Revenue-Producing Property for that period (whether or not payable
during that period), PLUS (d) depreciation, amortization and all other
non-cash expenses of that Revenue-Producing Property for that period, in
each case as determined in accordance with Generally Accepted Accounting
Principles, and ADJUSTED BY SUBTRACTING therefrom a property expenditure
reserve equal to 22% of the rental revenues of that Revenue-Producing
Property for that period.
"ADJUSTED TOTAL LIABILITIES" means, as of any date of determination,
without duplication, the SUM OF (a) Total Liabilities as of that date,
PLUS (b) an amount equal to 50% of the face amount of all undrawn
letters of credit for which Parent or any of its Wholly-Owned
Subsidiaries is the account party outstanding on that date, PLUS (c) the
aggregate Indebtedness covered by all Guaranty Obligations of Parent and
its Wholly-Owned Subsidiaries outstanding on that date, PLUS (d) the
aggregate Indebtedness of all partnerships in which Parent or any
Wholly-Owned Subsidiary is a general partner on that date, PLUS (e) the
Parent's Proportional Share of the Indebtedness of any Related Venture.
"ADVANCE" means any advance made or to be made by any Bank to
Borrowers as provided in ARTICLE 2, and INCLUDES each Alternate Base
Rate Advance and Eurodollar Rate Advance.
"AFFILIATE" means, as to any Person, any other Person which directly
or indirectly controls, or is under common control with, or is
controlled by, such Person. As used in this definition, "control" (and
the correlative terms, "controlled by" and "under common control with")
shall mean possession, directly or indirectly, of power to direct or
cause the direction of management or
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policies (whether through ownership of securities or partnership or
other ownership interests, by contract or otherwise); PROVIDED that, in
any event, any Person that owns, directly or indirectly, 10% or more of
the securities having ordinary voting power for the election of
directors or other governing body of a corporation that has more than
100 record holders of such securities, or 10% or more of the partnership
or other ownership interests of any other Person that has more than 100
record holders of such interests, will be deemed to be an Affiliate of
such corporation, partnership or other Person.
"AGREEMENT" means this Revolving Loan Agreement, either as
originally executed or as it may from time to time be supplemented,
modified, amended, restated or extended.
"ALTERNATE BASE RATE" means, as of any date of determination, the
rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%)
equal to the HIGHER OF (a) the Reference Rate in effect on such date and
(b) the Federal Funds Rate in effect on such date plus 2 of 1% (50 basis
points).
"ALTERNATE BASE RATE ADVANCE" means an Advance made hereunder and
specified to be an Alternate Base Rate Advance in accordance with
ARTICLE 2.
"ALTERNATE BASE RATE LOAN" means a Loan made hereunder and specified
to be an Alternate Base Rate Loan in accordance with ARTICLE 2.
"AMORTIZATION AMOUNT" means, if the Term Loan Conversion has
occurred, the result obtained by DIVIDING (a) the aggregate principal
balance outstanding under the Line A Notes and the Line B Notes on the
Conversion Date by (b) seven (7).
"AMORTIZATION DATE" means, if the Term Loan Conversion has occurred,
(a) the date that is six (6) months after the Conversion Date and (b)
every three (3) months thereafter through and including the Maturity
Date.
"ANNUALIZED ADJUSTED EBITDA" means, for any fiscal period, (a)
Adjusted EBITDA of Parent for that fiscal period PLUS (b) with respect
to any such fiscal period in which any Revenue-Producing Property
(herein the "New Property") has not been owned and operated by Parent or
one of its
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Subsidiaries for at least four (4) full Fiscal Quarters, such amount as
is necessary to reflect the annualization of Adjusted EBITDA
attributable to the New Property using the following conventions: (i) if
the New Property has been owned and operated by Parent or its Subsidiary
for at least one (1) Fiscal Quarter, the Adjusted NOI of the New
Property shall be multiplied by the appropriate factor so as to result
in annualized Adjusted NOI for the full four (4) Fiscal Quarters and
(ii) if the New Property has not been owned and operated by Parent or
its Subsidiary for at least one (1) Fiscal Quarter, the Adjusted NOI of
the New Property for the four (4) Fiscal Quarters shall be deemed to be
the Adjusted NOI for such period reflected in a pro-forma income
statement for the New Property prepared by Parent in good faith using
reasonable assumptions consistent with all facts known to Parent.
"ANNUALIZED ADJUSTED NOI" means, with respect to any
Revenue-Producing Property and for any fiscal period, (a) Adjusted NOI
of that Revenue-Producing Property PLUS (b) with respect to any such
fiscal period in which any Revenue-Producing Property (herein, the "New
Property") has not been owned and operated by Parent or one of its
Subsidiaries for at least four (4) full Fiscal Quarters, such amount as
is necessary to reflect the annualization of Adjusted NOI attributable
to the New Property using the following conventions: (i) if the New
Property has been owned and operated by Parent or its Subsidiary for at
least one (1) Fiscal Quarter, the Adjusted NOI of the New Property shall
be multiplied by the appropriate factor so as to result in annualized
Adjusted NOI for the full four (4) Fiscal Quarters and (ii) if the New
Property has not been owned and operated by Parent or its Subsidiary for
at least one (i) Fiscal Quarter, the Adjusted NOI of the New Property
for the four (4) Fiscal Quarters shall be deemed to be the Adjusted NOI
for such period reflected in a pro-forma income statement for the New
Property prepared by Parent in good faith using reasonable assumptions
consistent with all facts known to Parent.
"APPLICABLE ALTERNATE BASE RATE MARGIN" means, for each Pricing
Period, the interest rate margin set forth below (expressed in basis
points per annum) opposite the Applicable Pricing Level for that Pricing
Period:
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APPLICABLE
PRICING LEVEL MARGIN
------------- ------
I 0
II 0
III 0
IV 0
V 25
"APPLICABLE COMMITMENT FEE RATE" means, for each Pricing Period, the
rate set forth below (expressed in basis points per annum) opposite the
Applicable Pricing Level for that Pricing Period:
APPLICABLE
PRICING LEVEL COMMITMENT FEE
------------- --------------
I 17.50
II 17.50
III 25.00
IV 25.00
V 25.00
"APPLICABLE EURODOLLAR RATE MARGIN" means, for each Pricing Period,
the interest rate margin set forth below (expressed in basis points per
annum) opposite the Applicable Pricing Level for that Pricing Period:
APPLICABLE
PRICING LEVEL MARGIN
------------- ------
I 110.00
II 120.00
III 130.00
IV 140.00
V 150.00
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"APPLICABLE PRICING LEVEL" means (a) for any date on which Parent
holds a Credit Rating of BBB (or its equivalent) or better, Pricing
Level I, (b) for any date on which Parent holds a Credit Rating of BBB-
(or its equivalent), Pricing Level II and (c) for any date during a
Pricing Period on which Parent does not hold a Credit Rating of BBB- (or
its equivalent) or better, the pricing level set forth below opposite
the Leverage Ratio as of the last day of the Fiscal Quarter most
recently ended prior to the commencement of that Pricing Period:
PRICING LEVEL LEVERAGE RATIO
------------- --------------
III Less than .35 to 1.00
IV Equal to or greater than .35 to 1.00
but less than .45 to 1.00
V Greater than .45 to 1.00;
PROVIDED that (a) the Applicable Pricing Level for the initial Pricing
Period shall (UNLESS Pricing Level I or Pricing Level II is then in
effect) be Pricing Level III, (b) in the event that Borrowers do not
deliver a Pricing Certificate with respect to any Pricing Period prior
to the commencement of such Pricing Period, then until (but only until)
such Pricing Certificate is delivered the Applicable Pricing Level for
that Pricing Period shall be Pricing Level V and (c) if any Pricing
Certificate is subsequently determined to be in error, then the
resulting change in the Applicable Pricing Level shall be made
retroactively to the beginning of the relevant Pricing Period.
"BANK" means each bank whose name is set forth in the signature
pages of this Agreement and each lender which may hereafter become a
party to this Agreement pursuant to Section 11.8.
"BANKING DAY" means any Monday, Tuesday, Wednesday, Thursday or
Friday, OTHER THAN a day on which banks are authorized or required to be
closed in California or New York.
"BORROWING BASE" means, as of any date of determination, the LESSER
OF (a) the Net Leverage Base on that date or (b) the Net Mortgage Amount
on that date.
"BORROWERS" means, collectively, (a) Parent, (b) QRS, (c) ARE and
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(d) any other Wholly-Owned Subsidiary of Parent that hereafter executes
a Joinder Agreement pursuant to Section 5.13. Borrowers are jointly and
severally obligated with respect to the Obligations.
"CAPITAL LEASE OBLIGATIONS" means all monetary obligations of a
Person under any leasing or similar arrangement which, in accordance
with Generally Accepted Accounting Principles, is classified as a
capital lease.
"CAPITALIZATION RATE" means (a) during the period from the Closing
Date through June 30, 1998, ten percent (10%) and (b) during each twelve
(12) month period thereafter, the capitalization rate determined by
Arthur Andersen & Co. (or other independent expert mutually acceptable
to Parent and the Managing Agent) as of the beginning of each such
period to be the prevailing capitalization rate used by sophisticated
real estate industry professionals to value properties comparable to
those in the Unencumbered Asset Pool for comparable purposes; PROVIDED
that if the capitalization rate is for any reason not so determined as
of the beginning of any such period, then the capitalization rate in
effect for the prior period shall remain in effect.
"CASH" means, when used in connection with any Person, all monetary
and non-monetary items owned by that Person that are treated as cash in
accordance with Generally Accepted Accounting Principles, consistently
applied.
"CASH INCOME TAXES" means, with respect to any fiscal period, taxes
on or measured by the income of Borrowers that are paid or currently
payable in Cash by Borrowers during that fiscal period.
"CASH INTEREST EXPENSE" means Interest Expense that is paid or
currently payable in Cash.
"CERTIFICATE" means a certificate signed by a Senior Officer or
Responsible Official (as applicable) of the Person providing the
certificate.
"CHANGE IN CONTROL" means (a) any transaction or series of related
transactions in which any Unrelated Person or two or more Unrelated
Persons acting in concert acquire beneficial ownership (within the
meaning of
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Rule 13d-3(a)(1) under the Securities Exchange Act of 1934, as amended),
directly or indirectly, of 40% or more of the outstanding Common Stock, (b)
Parent consolidates with or merges into another Person or conveys, transfers
or leases its properties and assets substantially as an entirety to any
Person or any Person consolidates with or merges into Parent, in either event
pursuant to a transaction in which the outstanding Common Stock is changed
into or exchanged for cash, securities or other property, with the effect
that any Unrelated Person becomes the beneficial owner, directly or
indirectly, of 40% or more of Common Stock or that the Persons who were the
holders of Common Stock immediately prior to the transaction hold less than
60% of the common stock of the surviving corporation after the transaction,
(c) during any period of 24 consecutive months, individuals who at the
beginning of such period constituted the board of directors of Parent
(together with any new or replacement directors whose election by the board
of directors, or whose nomination for election, was approved by a vote of at
least a majority of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
reelection was previously so approved) cease for any reason to constitute a
majority of the directors then in office or (d) a "change in control" as
defined in any document governing Indebtedness of Parent in excess of
$25,000,000 which gives the holders of such Indebtedness the right to
accelerate or otherwise require payment of such Indebtedness prior to the
maturity date thereof. For purposes of the foregoing, the term "UNRELATED
PERSON" means any Person OTHER THAN (i) a Subsidiary of Parent, (ii) an
employee stock ownership plan or other employee benefit plan covering the
employees of Parent and its Subsidiaries or (iii) any Person that held Common
Stock on the day prior to the effective date of Parent's registration
statement under the Securities Act of 1933 covering the initial public
offering of Common Stock.
"CLOSING DATE" means the time and Banking Day on which the conditions set
forth in Section 8.1 are satisfied or waived. The Managing Agent shall
notify Borrowers and the Banks of the date that is the Closing Date.
"CODE" means the Internal Revenue Code of 1986, as amended or replaced
and as in effect from time to time.
"COMMITMENTS" means the Line A Commitment and the Line B Commitment.
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"COMMITMENTS ASSIGNMENT AND ACCEPTANCE" means a commitment assignment and
acceptance substantially in the form of EXHIBIT A.
"COMMITTED ADVANCE" means an Advance made to Borrowers by any Bank in
accordance with its Pro Rata Share of the Commitments pursuant to Section 2.1.
"COMMITTED LOANS" means Loans that are comprised of Committed Advances.
"COMMON STOCK" means the common stock of Parent or its successor.
"COMPETITIVE ADVANCE" means an Advance made to Borrowers by any Bank not
determined by that Bank's Pro Rata Share of the Commitments pursuant to
Section 2.4.
"COMPETITIVE ADVANCE NOTE" means the promissory note made by Borrowers in
favor of a Bank to evidence the Competitive Advances made by that Bank,
substantially in the form of EXHIBIT B, either as originally executed or as
the same may from time to time be supplemented, modified, amended, renewed,
extended or supplanted.
"COMPETITIVE BID" means (a) a written bid to provide a Competitive
Advance substantially in the form of EXHIBIT C, signed by a Responsible
Official of a Bank and properly completed to provide all information required
to be included therein or (b) at the election of any Bank, a telephonic bid
by that Bank to provide a Competitive Advance which, if so made, shall be
made by a Responsible Official of that Bank and deemed to have been made
incorporating the substance of EXHIBIT C, and shall promptly be confirmed by
a written Competitive Bid.
"COMPETITIVE BID REQUEST" means (a) a written request submitted by
Borrowers to the Managing Agent to provide a Competitive Bid, substantially
in the form of EXHIBIT D, signed by a Responsible Official of Borrowers and
properly completed to provide all information required to be included therein
or (b) at the election of Borrowers, a telephonic request by Borrowers to the
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Managing Agent to provide a Competitive Bid which, if so made, shall be made
by a Responsible Official of Borrowers and deemed to have been made
incorporating the substance of EXHIBIT D, and shall promptly be confirmed by
a written Competitive Bid Request.
"COMPLIANCE CERTIFICATE" means a certificate in the form of EXHIBIT E,
properly completed and signed by a Senior Officer of Borrowers.
"CONSENT CRITERIA" means, as of any date of determination, that as of
that date EITHER (a) Parent holds a Credit Rating of BBB- (or its equivalent)
or better or (b) as of the last day of the Fiscal Quarter then most
recently-ended, the RATIO OF (i) Adjusted NOI of the Revenue-Producing
Properties in the Unencumbered Asset Pool (INCLUDING any Qualified Investment
Pool Property (herein, the "New Property") proposed to be added to the
Unencumbered Asset Pool; PROVIDED, however, in the case of any such New
Property that within the preceding sixty (60) day period has been purchased
by a Borrower from a Person that is now a tenant occupying 100% of such New
Property, that Adjusted NOI for such New Property shall be the Adjusted NOI
for the first year of such lease as reflected in a pro-forma income statement
for this New Property prepared by Parent in good faith using reasonable
assumptions consistent with all facts known to Parent) for the fiscal period
consisting of that Fiscal Quarter and the three immediately preceding Fiscal
Quarters to (ii) the SUM OF (A) Interest Charges for such fiscal period PLUS
(B) all scheduled principal payments on Indebtedness of Parent (INCLUDING the
principal portion of rent under Capital Lease Obligations) made during such
fiscal period, OTHER THAN payments made at the maturity date of such
Indebtedness, was 3.50 to 1.00 or greater.
"CONTRACTUAL OBLIGATION" means, as to any Person, any provision of any
outstanding security issued by that Person or of any material agreement,
instrument or undertaking to which that Person is a party or by which it or
any of its Property is bound.
"CONTROLLED ENTITY" means a Person (a) that is a Subsidiary of Parent,
(b) that is a general partnership or a limited partnership in which a
Wholly-Owned Subsidiary is the sole managing general partner and such
managing general partner has the sole power to (i) sell all or substantially
all of the assets of such Person, (ii) incur Indebtedness in the name of such
Person,
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(iii) grant a Lien on all or any portion of the assets of such Person and
(iv) otherwise generally manage the business and assets of such Person or (c)
that is a limited liability company for which a Wholly-Owned Subsidiary is
the sole manager and such manager has the sole power to do the acts described
in subclauses (i) through (iv) of clause (b) above.
"CONVERSION DATE" means the Maturity Date in effect immediately prior to
the date upon which the Term Loan Conversion is effected.
"CREDIT RATING" means, as of any date of determination, the credit rating
(or its equivalent) then assigned to Parent's long-term senior unsecured debt
by at least two (2) Rating Agencies; PROVIDED that any credit rating so
assigned by a Rating Agency shall be deemed for this purpose to include all
lower credit ratings of such Rating Agency. For purposes of the foregoing,
"RATING AGENCIES" means (a) Standard & Poor's Rating Group (a division of
McGraw Hill, Inc.) ("S&P") and its successors, (b) Moody's Investor Services,
Inc. ("Moody's") and its successors and (c) Duff and Phelps Credit Rating Co.,
Inc. ("Duff") and its successors. A credit rating of BBB- from S&P is
equivalent to a credit rating of Baa3 from Moody's and BBB- from Duff, and
vice versa. A credit rating of BBB from S&P is equivalent to a credit rating
of Baa2 from Moody's and BBB from Duff, and vice versa.
"DEBTOR RELIEF LAWS" means the Bankruptcy Code of the United States of
America, as amended from time to time, and all other applicable liquidation,
conservatorship, bankruptcy, moratorium, rearrangement, receivership,
insolvency, reorganization, or similar debtor relief Laws from time to time
in effect affecting the rights of creditors generally.
"DEFAULT" means any event that, with the giving of any applicable notice
or passage of time specified in Section 9.1, or both, would be an Event of
Default.
"DEFAULT RATE" means the interest rate prescribed in Section 3.9.
"DESIGNATED DEPOSIT ACCOUNT" means a deposit account to be maintained by
Borrowers with Bank of America National Trust and Savings Association or one
of its Affiliates, as from time to time designated by Borrowers by written
-11-
notification to the Managing Agent.
"DESIGNATED EURODOLLAR MARKET" means, with respect to any Eurodollar Rate
Loan, the London Eurodollar Market.
"DISQUALIFIED STOCK" means any capital stock, warrants, options or other
rights to acquire capital stock (but excluding any debt security which is
convertible, or exchangeable, for capital stock), which, by its terms (or by
the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is
redeemable at the option of the holder thereof, in whole or in part, on or
prior to the Maturity Date.
"DISTRIBUTION" means, with respect to any shares of capital stock or any
warrant or option to purchase an equity security or other equity security
issued by a Person, (i) the retirement, redemption, purchase or other
acquisition for Cash or for Property by such Person of any such security,
(ii) the declaration or (without duplication) payment by such Person of any
dividend in Cash or in Property on or with respect to any such security,
(iii) any Investment by such Person in the holder of 5% or more of any such
security if a purpose of such Investment is to avoid characterization of the
transaction as a Distribution and (iv) any other payment in Cash or Property
by such Person constituting a distribution under applicable Laws with respect
to such security.
"DOLLARS" or "$" means United States dollars.
"DOMESTIC REFERENCE BANK" means Bank of America National Trust and
Savings Association or such other Bank as may be appointed by the Managing
Agent with the approval of Parent (which shall not be unreasonably withheld).
"ELIGIBLE ASSIGNEE" means (a) another Bank, (b) with respect to any Bank,
any Affiliate of that Bank, (c) any commercial bank having a combined capital
and surplus of $100,000,000 or more, (d) any (i) savings bank, savings and
loan association or similar financial institution or (ii) insurance company
engaged in the business of writing insurance which, in either case (A) has a
net worth of $200,000,000 or more, (B) is engaged in the business of lending
-12-
money and extending credit under credit facilities substantially similar to
those extended under this Agreement and (C) is operationally and procedurally
able to meet the obligations of a Bank hereunder to the same degree as a
commercial bank and (e) any other financial institution (INCLUDING a mutual
fund or other fund) having total assets of $250,000,000 or more which meets
the requirements set forth in subclauses (B) and (C) of clause (d) above;
PROVIDED that each Eligible Assignee must either (a) be organized under the
Laws of the United States of America, any State thereof or the District of
Columbia or (b) be organized under the Laws of the Cayman Islands or any
country which is a member of the Organization for Economic Cooperation and
Development, or a political subdivision of such a country, and (i) act
hereunder through a branch, agency or funding office located in the United
States of America and (ii) be exempt from withholding of tax on interest and
deliver the documents related thereto pursuant to Section 11.21.
"EMPLOYEE PLAN" means any (a) employee benefit plan (as defined in
Section 3(3) of ERISA) that is subject to Title I of ERISA, (b) any plan (as
defined in Section 4975(e)(1) of the Code) that is subject to Section 4975 of
the Code, (c) any entity the underlying assets of which include plan assets
(as defined in 29 C.F.R. Section 2510.3-101 or otherwise under ERISA) by
reason of a plan's investment in such entity (INCLUDING an insurance company
general account), or (d) a governmental plan (as defined in Section 3(32) of
ERISA or Section 414(d) of the Code) organized in a jurisdiction within the
United States of America having prohibitions on transactions with such
governmental plan substantially similar to those contained in Section 406 of
ERISA or Section 4975 of the Code.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
any regulations issued pursuant thereto, as amended or replaced and as in
effect from time to time.
"ERISA AFFILIATE" means each Person (whether or not incorporated) which
is required to be aggregated with Parent pursuant to Section 414 of the Code.
"EURODOLLAR BANKING DAY" means any Banking Day on which dealings in
Dollar deposits are conducted by and among banks in the Designated Eurodollar
-13-
Market.
"EURODOLLAR LENDING OFFICE" means, as to each Bank, its office or branch
so designated by written notice to Borrowers and the Managing Agent as its
Eurodollar Lending Office. If no Eurodollar Lending Office is designated by
a Bank, its Eurodollar Lending Office shall be its office at its address for
purposes of notices hereunder.
"EURODOLLAR MARKET" means a regular established market located outside
the United States of America by and among banks for the solicitation, offer
and acceptance of Dollar deposits in such banks.
"EURODOLLAR OBLIGATIONS" means eurocurrency liabilities, as defined in
Regulation D or any comparable regulation of any Governmental Agency having
jurisdiction over any Bank.
"EURODOLLAR PERIOD" means, as to each Eurodollar Rate Loan, the period
commencing on the date specified by Borrowers pursuant to Section 2.1(c) and
ending 1, 2, 3 or 6 months (or, with the written consent of all of the Banks,
any other period) thereafter, as specified by Borrowers in the applicable
Request for Loan; PROVIDED that:
(a) The first day of any Eurodollar Period shall be a Eurodollar
Banking Day;
(b) Any Eurodollar Period that would otherwise end on a day that is
not a Eurodollar Banking Day shall be extended to the next succeeding
Eurodollar Banking Day unless such Eurodollar Banking Day falls in
another calendar month, in which case such Eurodollar Period shall end
on the next preceding Eurodollar Banking Day;
(c) Borrowers may not specify a Eurodollar Period that extends
beyond the next Amortization Date unless the aggregate principal amount
of the Eurodollar Loans having a Eurodollar Period ending after such
Amortization Date does not exceed the Commitments (after giving effect
to any reduction thereto scheduled to be made on such Amortization Date
pursuant to Section 2.6); and
-14-
(d) No Eurodollar Period shall extend beyond the Maturity Date.
"EURODOLLAR RATE" means, with respect to any Eurodollar Rate Loan, the
average of the interest rates per annum (rounded upward, if necessary, to the
next 1/100 of 1%) at which deposits in Dollars are offered by the Eurodollar
Reference Banks to prime banks in the Designated Eurodollar Market at or
about 11:00 a.m. local time in the Designated Eurodollar Market, two (2)
Eurodollar Banking Days before the first day of the applicable Eurodollar
Period in an aggregate amount approximately equal to the amount of the
Advance made by the Eurodollar Reference Bank with respect to such Eurodollar
Rate Loan and for a period of time comparable to the number of days in the
applicable Eurodollar Period.
"EURODOLLAR RATE ADVANCE" means an Advance made hereunder and specified
to be a Eurodollar Rate Advance in accordance with ARTICLE 2.
"EURODOLLAR RATE LOAN" means a Loan made hereunder and specified to be a
Eurodollar Rate Loan in accordance with ARTICLE 2.
"EURODOLLAR REFERENCE BANK" means Bank of America National Trust and
Savings Association or such other Bank as may be appointed by the Managing
Agent with the approval of Parent (which shall not be unreasonably withheld).
"EVENT OF DEFAULT" shall have the meaning provided in Section 9.1.
"FEDERAL FUNDS RATE" means, as of any date of determination, the rate set
forth in the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Board (including any
such successor, "H.15(519)") for such date opposite the caption "Federal
Funds (Effective)". If for any relevant date such rate is not yet published
in H.15(519), the rate for such date will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publication, published by the Federal
Reserve Bank of New York (including any such successor, the "Composite 3:30
p.m.
-15-
Quotation") for such date under the caption "Federal Funds Effective Rate".
If on any relevant date the appropriate rate for such date is not yet
published in either H.15(519) or the Composite 3:30 p.m. Quotations, the rate
for such date will be the arithmetic mean of the rates for the last
transaction in overnight Federal funds arranged prior to 9:00 a.m. (New York
City time) on that date by each of three leading brokers of Federal funds
transactions in New York City selected by the Managing Agent. For purposes
of this Agreement, any change in the Alternate Base Rate due to a change in
the Federal Funds Rate shall be effective as of the opening of business on
the effective date of such change.
"FISCAL QUARTER" means the fiscal quarter of Borrowers ending on each
March 31, June 30, September 30 and December 31.
"FISCAL YEAR" means the fiscal year of Borrowers ending on each
December 31.
"FIXED CHARGE COVERAGE" means, as of the last day of each Fiscal
Quarter, the RATIO of (a) Adjusted EBITDA for the fiscal period consisting of
that Fiscal Quarter and the three immediately preceding Fiscal Quarters TO
(b) the SUM of (i) Interest Charges for such fiscal period PLUS (ii) all
scheduled principal payments on Indebtedness of Parent (INCLUDING the
principal portion of rent under Capital Lease Obligations) made during such
fiscal period, OTHER THAN payments made at the maturity date of such
Indebtedness PLUS (iii) all dividends on preferred stock of Parent made
during such fiscal period.
"FUNDS FROM OPERATIONS" means, with respect to any fiscal period,
(a) the Net Income of Parent for that period, PLUS (b) any loss resulting from
the restructuring of Indebtedness, sale of Property or other non-operating
non-recurring cause during that period, MINUS (c) any gain resulting from the
restructuring of Indebtedness, sale of Property or other non-operating
non-recurring cause during that period, PLUS (d) depreciation and
amortization of Revenue-Producing Properties (INCLUDING with respect to trade
fixtures and tenant improvements which are a part thereof and capitalized
leasing expenses, such as leasing commissions and tenant improvement
allowances), and ADJUSTED to take into account (i) the results of operations
of any unconsolidated Related Ventures calculated on the same basis and
(ii) any unusual and non-recurring expense which otherwise would materially
distort a comparative evaluation of
-16-
Funds From Operation for different fiscal periods. Funds From Operations
shall be determined in accordance with the March 1995 White Paper on Funds
From Operations approved by the Board of Governors of the National
Association of Real Estate Investment Trusts, as in effect on the Closing
Date.
"GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" means, as of any date of
determination, accounting principles (a) set forth as generally accepted in
then currently effective Opinions of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (b) set forth as
generally accepted in then currently effective Statements of the Financial
Accounting Standards Board or (c) that are then approved by such other entity
as may be approved by a significant segment of the accounting profession in
the United States of America. The term "CONSISTENTLY APPLIED," as used in
connection therewith, means that the accounting principles applied are
consistent in all material respects with those applied at prior dates or for
prior periods.
"GOVERNMENTAL AGENCY" means (a) any international, foreign, federal,
state, county or municipal government, or political subdivision thereof,
(b) any governmental or quasi-governmental agency, authority, board, bureau,
commission, department, instrumentality or public body or (c) any court or
administrative tribunal of competent jurisdiction.
"GROSS ASSET VALUE" means, as of the last day of each Fiscal Quarter,
the SUM OF (a) Cash held by Parent and its Subsidiaries as of that date PLUS
(b) the value obtained by DIVIDING (i) Annualized Adjusted EBITDA for the
fiscal period consisting of that Fiscal Quarter and the three immediately
preceding Fiscal Quarters BY (ii) the then effective Capitalization Rate.
"GUARANTY OBLIGATION" means, as to any Person, any (a) guarantee by that
Person of Indebtedness of, or other obligation performable by, any other
Person or (b) assurance given by that Person to an obligee of any other
Person with respect to the performance of an obligation by, or the financial
condition of, such other Person, whether direct, indirect or contingent,
INCLUDING any purchase or repurchase agreement covering such obligation or
any collateral security therefor, any agreement to provide funds (by means of
loans, capital contributions or otherwise) to such other Person, any
agreement to support the
-17-
solvency or level of any balance sheet item of such other Person or any
"keep-well" or other arrangement of whatever nature given for the purpose of
assuring or holding harmless such obligee against loss with respect to any
obligation of such other Person; PROVIDED, HOWEVER, that the term Guaranty
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation in respect of Indebtedness shall be deemed to be an amount equal
to the stated or determinable amount of the related Indebtedness (unless the
Guaranty Obligation is limited by its terms to a lesser amount, in which case
to the extent of such amount) or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the
Person in good faith. The amount of any other Guaranty Obligation shall be
deemed to be zero unless and until the amount thereof has been (or in
accordance with Financial Accounting Standards Board Statement No. 5 should
be) quantified and reflected or disclosed in the consolidated financial
statements (or notes thereto) of Borrowers.
"HAZARDOUS MATERIALS" means substances defined as "hazardous substances"
pursuant to the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, 42 U.S.C. Section 9601 et seq., or as "hazardous",
"toxic" or "pollutant" substances or as "solid waste" pursuant to the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et seq., the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., or
as "friable asbestos" pursuant to the Toxic Substances Control Act, 15 U.S.C.
Section 2601 et seq. or any other applicable Hazardous Materials Law, in each
case as such Laws are amended from time to time.
"HAZARDOUS MATERIALS LAWS" means all Laws governing the treatment,
transportation or disposal of Hazardous Materials applicable to any of the
Real Property.
"INDEBTEDNESS" means, as to any Person (without duplication),
(a) indebtedness of such Person for borrowed money or for the deferred
purchase price of Property (EXCLUDING trade and other accounts payable in the
ordinary course of business in accordance with ordinary trade terms),
INCLUDING any Guaranty Obligation for any such indebtedness, (b) indebtedness
of such Person of the nature described in clause (a) that is non-recourse to
the credit of
-18-
such Person but is secured by assets of such Person, to the extent of the
fair market value of such assets as determined in good faith by such Person,
(c) Capital Lease Obligations of such Person, (d) indebtedness of such Person
arising under bankers' acceptance facilities or under facilities for the
discount of accounts receivable of such Person, (e) any direct or contingent
obligations of such Person under letters of credit issued for the account of
such Person and (f) any net obligations of such Person under Swap Agreements.
"INITIAL POOL PROPERTIES" means the eleven (11) Revenue-Producing
Properties described in SCHEDULE 4.18.
"INTANGIBLE ASSETS" means assets that are considered intangible assets
under Generally Accepted Accounting Principles, INCLUDING customer lists,
goodwill, copyrights, trade names, trademarks and patents.
"INTEREST CHARGES" means, as of the last day of any fiscal period, the
SUM OF (a) Cash Interest Expense of Parent PLUS (b) all interest currently
payable by Parent in Cash incurred during that fiscal period which is
capitalized under Generally Accepted Accounting Principles PLUS (c) the
Parent's Proportional Share of the Cash Interest Expense and capitalized
interest payable in Cash of Related Ventures during that fiscal period.
"INTEREST COVERAGE" means, as of the last day of each Fiscal Quarter,
the RATIO OF (a) Adjusted EBITDA for the fiscal period consisting of that
Fiscal Quarter and the three immediately preceding Fiscal Quarters TO
(b) Interest Charges for that fiscal period.
"INTEREST EXPENSE" means, with respect to any Person and as of the last
day of any fiscal period, the SUM OF (a) all interest, fees, charges and
related expenses paid or payable (without duplication) for that fiscal period
by that Person to a lender in connection with borrowed money (INCLUDING any
obligations for fees, charges and related expenses payable to the issuer of
any letter of credit) or the deferred purchase price of assets that are
considered "interest expense" under Generally Accepted Accounting Principles
PLUS (b) the portion of rent paid or payable (without duplication) for that
fiscal period by that Person under Capital Lease Obligations that should be
treated as interest in accordance with Financial Accounting Standards Board
Statement No. 13.
-19-
"INTEREST PERIOD" means, with respect to any Eurodollar Rate Loan, the
related Eurodollar Period.
"INVESTMENT" means, when used in connection with any Person, any
investment by or of that Person, whether by means of purchase or other
acquisition of stock or other securities of any other Person or by means of a
loan, advance creating a debt, capital contribution, guaranty or other debt
or equity participation or interest in any other Person, INCLUDING any
partnership and joint venture interests of such Person. The amount of any
Investment shall be the amount actually invested (MINUS any return of capital
with respect to such Investment which has actually been received in Cash or
has been converted into Cash), without adjustment for subsequent increases or
decreases in the value of such Investment.
"JOINDER AGREEMENT" means the joinder agreement with respect to this
Agreement to be executed and delivered pursuant to Section 5.13 by any
additional Borrower in the form of EXHIBIT F, either as originally executed
or as it may from time to time be supplemented, modified, amended, extended
or supplanted.
"LAWS" means, collectively, all international, foreign, federal, state
and local statutes, treaties, rules, regulations, ordinances, codes and
administrative or judicial precedents.
"LEVERAGE RATIO" means, as of the last day of each Fiscal Quarter, the
RATIO OF (a) Adjusted Total Liabilities as of that date TO (b) Gross Asset
Value as of that date.
"LIEN" means any mortgage, deed of trust, pledge, hypothecation,
assignment for security, security interest, encumbrance, lien or charge of
any kind, whether voluntarily incurred or arising by operation of Law or
otherwise, affecting any Property, INCLUDING any conditional sale or other
title retention agreement, any lease in the nature of a security interest,
and/or the filing of any financing statement (OTHER THAN a precautionary
financing statement with respect to a lease that is not in the nature of a
security interest) under the Uniform Commercial Code or comparable Law of any
jurisdiction with respect to any
-20-
Property.
"LINE A COMMITMENT" means, subject to Sections 2.5 and 2.6,
$100,000,000. The respective Pro Rata Shares of the Banks with respect to
the Line A Commitment are set forth in SCHEDULE 1.1.
"LINE A NOTE" means any of the promissory notes made by Borrowers to a
Bank evidencing Advances under that Bank's Pro Rata Share of the Line A
Commitment, substantially in the form of EXHIBIT G, either as originally
executed or as the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"LINE A LOAN" means any Loan made under the Line A Commitment.
"LINE B COMMITMENT" means, subject to Sections 2.5 and 2.6, $50,000,000.
No credit is available under the Line B Commitment unless and until
activated pursuant to Section 2.1(b). The respective Pro Rata Shares of the
Banks with respect to the Line B Commitment are set forth in SCHEDULE 1.1.
"LINE B LOAN" means a Loan made under the Line B Commitment.
"LINE B NOTE" means any of the promissory notes made by Borrowers to a
Bank evidencing Advances under that Bank's Pro Rata Share of the Line B
Commitment, substantially in the form of EXHIBIT H, either as originally
executed or as the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"LOAN" means the aggregate of the Advances made at any one time by the
Banks pursuant to Section 2.1.
"LOAN DOCUMENTS" means, collectively, this Agreement, the Notes, and any
other agreements of any type or nature hereafter executed and delivered by
Borrowers to the Managing Agent or to any Bank in any way relating to or in
furtherance of this Agreement, in each case either as originally executed or
as the same may from time to time be supplemented, modified, amended,
restated, extended or supplanted.
-21-
"MANAGING AGENT" means Bank of America National Trust and Savings
Association, when acting in its capacity as the Managing Agent under any of
the Loan Documents, or any successor Managing Agent.
"MANAGING AGENT'S OFFICE" means the Managing Agent's address as set
forth on the signature pages of this Agreement, or such other address as the
Managing Agent hereafter may designate by written notice to Borrowers and the
Banks.
"MARGIN STOCK" means "margin stock" as such term is defined in
Regulation G or U.
"MARKET NET WORTH" means, as of the last day of each Fiscal Quarter, the
amount by which (a) Gross Asset Value on that date exceeds (b) Total
Liabilities on that date.
"MATERIAL ADVERSE EFFECT" means any set of circumstances or events which
(a) has had or could reasonably be expected to have any material adverse
effect whatsoever upon the validity or enforceability of any Loan Document
(OTHER THAN as a result of any action or inaction of the Managing Agent or
any Bank), (b) has been or could reasonably be expected to be material and
adverse to the business or condition (financial or otherwise) of Borrowers or
(c) has materially impaired or could reasonably be expected to materially
impair the ability of Borrowers to perform the Obligations.
"MATURITY DATE" means (a) May 31, 2000, (b) if the Revolver Termination
Date has then been extended pursuant to Section 2.9, such extended Revolver
Termination Date or (c) if the Term Loan Conversion has then been effected
pursuant to Section 2.10, the date that is two (2) years subsequent to the
Conversion Date.
"MAXIMUM COMPETITIVE ADVANCE" means, with respect to any Competitive Bid
made by a Bank, the amount set forth therein as the maximum Competitive
Advance which that Bank is willing to make in response to the related
Competitive Bid Request.
"MONTHLY PAYMENT DATE" means the first day of each calendar month.
-22-
"MORTGAGE AMOUNT" means, as of the last day of each Fiscal Quarter, the
principal amount of a twenty-five (25) year mortgage loan that would bear
interest at a rate equal to the SUM OF the Treasury Base Rate plus 2% (200
basis points), that would fully amortize in equal consecutive monthly
installments of principal and interest over the term thereof and that is
Supportable by the Annualized Adjusted NOI of the Revenue-Producing
Properties in the Unencumbered Asset Pool for that Fiscal Quarter and the
three immediately preceding Fiscal Quarters. For purposes of the foregoing,
"TREASURY BASE RATE" means the yield (adjusted to constant maturity and
expressed as a rate per annum) of the United States Treasury Security then
maturing in seven (7) years or, if there is more than one such United States
Treasury Security, the average of such yields, or if there is no such United
States Treasury Security, the yield determined by interpolation of the yields
of the United States Treasury Securities maturing on the nearest earlier and
later dates, in all cases adjusted to constant maturity and expressed as a
rate per annum, as reported at the close of business on the last day of the
Fiscal Quarter by the Bloomberg Financial Market Information Service (or
other nationally-recognized on-line trading screen which reports current
trading in United States Treasury Securities) or, if no such trading screen
is available, as reported in the most recent Federal Reserve Board
Statistical Release and "SUPPORTABLE" means that such Annualized Adjusted NOI
is 200% (the "SUPPORT MULTIPLE") of the aggregate annual monthly payments
under such a mortgage loan.
"MULTIEMPLOYER PLAN" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA to which Borrowers or any of their
ERISA Affiliates contribute or are obligated to contribute.
"NEGATIVE PLEDGE" means a Contractual Obligation that contains a
covenant binding on Borrowers that prohibits Liens on any of their Property,
OTHER THAN (a) any such covenant contained in a Contractual Obligation
granting or relating to a particular Lien which affects only the Property
that is the subject of such Lien and (b) any such covenant that does not
apply to Liens securing the Obligations.
"NET INCOME" means, with respect to any Person and with respect to any
fiscal period, the net income of that Person for that period, determined in
-23-
accordance with Generally Accepted Accounting Principles, consistently
applied.
"NET LEVERAGE BASE" means, as of any date of determination, (a) an
amount equal to 50% of the Unencumbered Asset Pool Value as of the most
recently-ended Fiscal Quarter MINUS (b) any Other Unsecured Debt on that date.
"NET MORTGAGE AMOUNT" means, as of any date of determination, (a) the
Mortgage Amount applicable to the Unencumbered Asset Pool as of the most
recently-ended Fiscal Quarter MINUS (b) any Other Unsecured Debt on that date.
"NON-RECOURSE DEBT" means Indebtedness of Parent or any of its
Subsidiaries for which the liability of Parent or such Subsidiary (EXCEPT
with respect to fraud, Hazardous Materials Laws liability and other customary
exceptions) either is contractually limited to collateral securing such
Indebtedness or is so limited by operation of Law.
"NOTES" means the Line A Notes, the Line B Notes and the Competitive
Advance Notes.
"OBLIGATIONS" means all present and future obligations of every kind or
nature of Borrowers at any time and from time to time owed to the Managing
Agent or the Banks or any one or more of them, under any one or more of the
Loan Documents, whether due or to become due, matured or unmatured,
liquidated or unliquidated, or contingent or noncontingent, INCLUDING
obligations of performance as well as obligations of payment, and INCLUDING
interest that accrues after the commencement of any proceeding under any
Debtor Relief Law by or against Borrowers.
"OPINIONS OF COUNSEL" means the favorable written legal opinions of
(a) Gary A. Kreitzer, general counsel of Borrowers, (b) Ballard Spahr Andrews &
Ingersoll, special Maryland counsel to Borrowers and (c) Skadden, Arps,
Slate, Meagher & Flom, LLP, special counsel to Borrowers, substantially in
the form of EXHIBITS I-1 AND I-2 , respectively, together with copies of all
factual certificates and legal opinions delivered to such counsel in
connection with such opinion upon which such counsel has relied.
-24-
"OTHER UNSECURED DEBT" means Indebtedness of any of Borrowers (OTHER
THAN Indebtedness under this Agreement) that is not secured by a Lien on any
Property of any of Borrowers.
"PARENT'S PROPORTIONAL SHARE" means, with respect to any Related
Venture, the percentage of the direct and indirect equity ownership interest
of Parent in the Related Venture.
"PARTY" means any Person other than the Managing Agent and the Banks,
which now or hereafter is a party to any of the Loan Documents.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereof established under ERISA.
"PENSION PLAN" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), OTHER THAN a Multiemployer Plan, which
is subject to Title IV of ERISA and is maintained by Borrowers or to which
Borrowers contribute or have an obligation to contribute.
"PERMITTED ENCUMBRANCES" means:
(a) Inchoate Liens incident to construction on or maintenance of
Property; or Liens incident to construction on or maintenance of
Property now or hereafter filed of record for which adequate reserves
have been set aside (or deposits made pursuant to applicable Law) and
which are being contested in good faith by appropriate proceedings and
have not proceeded to judgment, PROVIDED that, by reason of nonpayment
of the obligations secured by such Liens, no such Property is subject to
a material impending risk of loss or forfeiture;
(b) Liens for taxes and assessments on Property which are not yet
past due; or Liens for taxes and assessments on Property for which
adequate reserves have been set aside and are being contested in good
faith by appropriate proceedings and have not proceeded to judgment,
PROVIDED that, by reason of nonpayment of the obligations secured by
such Liens, no such Property is subject to a material impending risk of
loss or forfeiture;
-25-
(c) defects and irregularities in title to any Property which in
the aggregate do not materially impair the fair market value or use of
the Property for the purposes for which it is or may reasonably be
expected to be held;
(d) easements, exceptions, reservations, or other agreements for
the purpose of pipelines, conduits, cables, wire communication lines,
power lines and substations, streets, trails, walkways, drainage,
irrigation, water, and sewerage purposes, dikes, canals, ditches, the
removal of oil, gas, coal, or other minerals, and other like purposes
affecting Property which in the aggregate do not materially burden or
impair the fair market value or use of such Property for the purposes
for which it is or may reasonably be expected to be held;
(e) easements, exceptions, reservations, or other agreements for
the purpose of facilitating the joint or common use of Property in or
adjacent to a shopping center or similar project affecting Property
which in the aggregate do not materially burden or impair the fair
market value or use of such Property for the purposes for which it is or
may reasonably be expected to be held;
(f) rights reserved to or vested in any Governmental Agency to
control or regulate, or obligations or duties to any Governmental Agency
with respect to, the use of any Property;
(g) rights reserved to or vested in any Governmental Agency to
control or regulate, or obligations or duties to any Governmental Agency
with respect to, any right, power, franchise, grant, license, or permit;
(h) present or future zoning laws and ordinances or other laws and
ordinances restricting the occupancy, use, or enjoyment of Property;
(i) statutory Liens, other than those described in clauses (a) or
(b) above, arising in the ordinary course of business with respect to
obligations which are not delinquent or are being contested in good
faith,
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PROVIDED that, if delinquent, adequate reserves have been set aside with
respect thereto and, by reason of nonpayment, no Property is subject to
a material impending risk of loss or forfeiture;
(j) covenants, conditions, and restrictions affecting the use of
Property which in the aggregate do not materially impair the fair market
value or use of the Property for the purposes for which it is or may
reasonably be expected to be held;
(k) rights of tenants under leases and rental agreements covering
Property entered into in the ordinary course of business of the Person
owning such Property;
(l) Liens consisting of pledges or deposits to secure obligations
under workers' compensation laws or similar legislation, including Liens
of judgments thereunder which are not currently dischargeable;
(m) Liens consisting of pledges or deposits of Property to secure
performance in connection with operating leases made in the ordinary
course of business, PROVIDED the aggregate value of all such pledges and
deposits in connection with any such lease does not at any time exceed
20% of the annual fixed rentals payable under such lease;
(n) Liens consisting of deposits of Property to secure bids made
with respect to, or performance of, contracts (OTHER THAN contracts
creating or evidencing an extension of credit to the depositor);
(o) Liens consisting of any right of offset, or statutory bankers'
lien, on bank deposit accounts maintained in the ordinary course of
business so long as such bank deposit accounts are not established or
maintained for the purpose of providing such right of offset or bankers'
lien;
(p) Liens consisting of deposits of Property to secure statutory
obligations of Borrowers;
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(q) Liens consisting of deposits of Property to secure (or in lieu
of) surety, appeal or customs bonds;
(r) Liens created by or resulting from any litigation or legal
proceeding in the ordinary course of business which is currently being
contested in good faith by appropriate proceedings, PROVIDED that,
adequate reserves have been set aside and no material Property is
subject to a material impending risk of loss or forfeiture; and
(s) other non-consensual Liens incurred in the ordinary course of
business but not in connection with the incurrence of any Indebtedness,
which do not in the aggregate, when taken together with all other Liens,
materially impair the fair market value or use of the Property for the
purposes for which it is or may reasonably be expected to be held.
"PERMITTED RIGHT OF OTHERS" means a Right of Others consisting of (a) an
interest (OTHER THAN a legal or equitable co-ownership interest, an option or
right to acquire a legal or equitable co-ownership interest and any interest
of a ground lessor under a ground lease), that does not materially impair the
fair market value or use of Property for the purposes for which it is or may
reasonably be expected to be held, (b) an option or right to acquire a Lien
that would be a Permitted Encumbrance, (c) the subordination of a lease or
sublease in favor of a financing entity and (d) a license, or similar right,
of or to Intangible Assets granted in the ordinary course of business.
"PERSON" means any individual or entity, INCLUDING a trustee,
corporation, limited liability company, general partnership, limited
partnership, joint stock company, trust, estate, unincorporated organization,
business association, firm, joint venture, Governmental Agency, or other
entity.
"PRICING CERTIFICATE" means a certificate in the form of EXHIBIT J,
properly completed and signed by a Senior Officer of Borrowers.
"PRICING PERIOD" means (a) the period commencing on the Closing Date and
ending on September 1, 1997, (b) the period commencing on each September 2,
and ending on the next following December 1, (c) the period
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commencing on each December 2 and ending on the next following March 1,
(d) the period commencing on each March 2 and ending on the next following
June 1, and (e) the period commencing on each June 2 and ending on the next
following September 1.
"PRIOR CREDIT AGREEMENT" means that certain Unsecured Line of Credit
Loan Agreement dated as of January 24, 1997 between Parent (then known as
"Health Science Properties, Inc.") and Bank of America National Trust Savings
Association.
"PROPERTY" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"PRO RATA SHARE" means, with respect to each Bank, the percentage of the
Commitments set forth opposite the name of that Bank on SCHEDULE 1.1, as such
percentage may be increased or decreased pursuant to a Commitments Assignment
and Acceptance executed in accordance with Section 11.8.
"QUALIFIED UNENCUMBERED ASSET POOL PROPERTY" means a Revenue-Producing
Property that (a) is wholly owned in fee simple absolute by Parent or any
other Borrower that is a Wholly-Owned Subsidiary, (b) is a Stabilized
Revenue-Producing Property and (c) is Unencumbered.
"QUARTERLY PAYMENT DATE" means each July 1, October 1, January 1 and
April 1.
"REAL PROPERTY" means, as of any date of determination, all real
property then or theretofore owned, leased or occupied by any of Borrowers.
"REFERENCE RATE" means the rate of interest publicly announced from time
to time by the Domestic Reference Bank in San Francisco, California (or other
headquarters city of the Domestic Reference Bank), as its "reference rate."
It is a rate set by the Domestic Reference Bank based upon various factors
including the Domestic Reference Bank's costs and desired return, general
economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such announced
rate. Any change in the Reference Rate announced by the Domestic Reference
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Bank shall take effect at the opening of business on the day specified in the
public announcement of such change.
"REGULATION D" means Regulation D, as at any time amended, of the Board
of Governors of the Federal Reserve System, or any other regulation in
substance substituted therefor.
"REGULATIONS G AND U" means Regulations G and U, as at any time amended,
of the Board of Governors of the Federal Reserve System, or any other
regulations in substance substituted therefor.
"RELATED VENTURE" means a corporation, limited liability company,
partnership or other Person that owns one or more Revenue-Producing
Properties and which is not a Wholly-Owned Subsidiary.
"REQUEST FOR LOAN" means a written request for a Loan substantially in
the form of EXHIBIT K, signed by a Responsible Official of any of Borrowers,
on behalf of Borrowers, and properly completed to provide all information
required to be included therein.
"REQUIREMENT OF LAW" means, as to any Person, the articles or
certificate of incorporation and by-laws or other organizational or governing
documents of such Person, and any Law, or judgment, award, decree, writ or
determination of a Governmental Agency, in each case applicable to or binding
upon such Person or any of its Property or to which such Person or any of its
Property is subject.
"REQUISITE BANKS" means (a) as of any date of determination if the
Commitments are then in effect, Banks having in the aggregate 66-2/3% or more
of the Commitments then in effect and (b) as of any date of determination if
the Commitments have then been suspended or terminated and there is then any
Indebtedness evidenced by the Notes, Banks holding Notes evidencing in the
aggregate 66-2/3% or more of the aggregate Indebtedness then evidenced by the
Notes.
"RESPONSIBLE OFFICIAL" means (a) when used with reference to a Person
other than an individual, any corporate officer of such Person, general
partner of such Person, corporate officer of a corporate general partner of
such Person, or
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corporate officer of a corporate general partner of a partnership that is a
general partner of such Person, or any other responsible official thereof
duly acting on behalf thereof, and (b) when used with reference to a Person
who is an individual, such Person. The Banks shall be entitled to
conclusively rely upon any document or certificate that is signed or executed
by a Responsible Official of Parent or any of its Subsidiaries as having been
authorized by all necessary corporate, partnership and/or other action on the
part of Parent or such Subsidiary.
"REVENUE-PRODUCING PROPERTY" means an identifiable real estate property,
such as an office building, laboratory, factory, warehouse or other facility
(INCLUDING the underlying real property and all appurtenant real property
rights) which produces revenue to Parent or a Subsidiary of Parent.
"REVENUE-PRODUCING PROPERTY VALUE" means, as of the last day of each
Fiscal Quarter, the value obtained by DIVIDING (a) the Annualized Adjusted
NOI of all Revenue-Producing Properties for the fiscal period consisting of
that Fiscal Quarter and the three immediately preceding Fiscal Quarters BY
(b) the then effective Capitalization Rate.
"REVOLVER TERMINATION DATE" means (a) May 31, 2000, (b) if the Revolver
Termination Date has then been extended pursuant to Section 2.9, such
extended Revolver Termination Date or (c) if the Term Loan Conversion has
then been effected pursuant to Section 2.10, the Conversion Date.
"RIGHT OF OTHERS" means, as to any Property in which a Person has an
interest, any legal or equitable right, title or other interest (other than a
Lien) held by any other Person in that Property, and any option or right held
by any other Person to acquire any such right, title or other interest in
that Property, INCLUDING any option or right to acquire a Lien; PROVIDED,
however, that (a) no covenant restricting the use or disposition of Property
of such Person contained in any Contractual Obligation of such Person and (b)
no provision contained in a contract creating a right of payment or
performance in favor of a Person that conditions, limits, restricts,
diminishes, transfers or terminates such right shall be deemed to constitute
a Right of Others.
"SECURED RECOURSE DEBT" means Indebtedness of Parent or any of its
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Subsidiaries (INCLUDING Indebtedness of a Related Venture which is the
subject of a Guaranty Obligation of Parent or a Subsidiary of Parent or, if
such Person is a partnership, of which Parent or a Subsidiary of Parent is a
general partner) that (a) is secured by a Lien on Revenue-Producing Property
and (b) for which the liability of Parent or its Subsidiary is not
contractually limited.
"SENIOR OFFICER" means (a) the chief executive officer, (b) the
president, (c) any executive vice president, (d) any senior vice president,
(e) the chief financial officer, (f) the treasurer or (g) any assistant
treasurer, in each case of any of the Borrowers.
"SPECIAL EURODOLLAR CIRCUMSTANCE" means the application or adoption
after the Closing Date of any Law or interpretation, or any change therein or
thereof, or any change in the interpretation or administration thereof by any
Governmental Agency, central bank or comparable authority charged with the
interpretation or administration thereof, or compliance by any Bank or its
Eurodollar Lending Office with any request or directive (whether or not
having the force of Law) of any such Governmental Agency, central bank or
comparable authority.
"STABILIZED REVENUE-PRODUCING PROPERTY" means a Revenue-Producing
Property (a) that has been at least 85% (measured by rentable square feet)
leased to Persons that are not an Affiliate of Parent for at least three (3)
consecutive months and (b) that met the requirements of clause (a) at the
time it became a part of the Unencumbered Asset Pool but subsequently failed
to meet such requirements, BUT ONLY (i) so long as Borrowers are making
reasonable efforts to cause such requirements to be met and (ii) for a period
not exceeding six (6) months from the date upon which such requirements were
first not met; PROVIDED, however, that the aggregate rentable square feet of
all Revenue-Producing Properties which qualify as Stabilized Revenue-Producing
Properties under this clause (B) may not at any time exceed 15% of the
aggregate rentable square feet of all Revenue-Producing Properties that are
in the Unencumbered Asset Pool.
"STOCKHOLDERS' EQUITY" means, as of any date of determination and with
respect to any Person, the consolidated stockholders' equity of the Person as
of that date determined in accordance with Generally Accepted Accounting
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Principles; PROVIDED that there shall be excluded from Stockholders' Equity
any amount attributable to Disqualified Stock.
"SUBSIDIARY" means, as of any date of determination and with respect to
any Person, any corporation, limited liability company or partnership
(whether or not, in any case, characterized as such or as a "joint venture"),
whether now existing or hereafter organized or acquired: (a) in the case of
a corporation or limited liability company, of which a majority of the
securities having ordinary voting power for the election of directors or
other governing body (other than securities having such power only by reason
of the happening of a contingency) are at the time beneficially owned by such
Person and/or one or more Subsidiaries of such Person, or (b) in the case of
a partnership, of which a majority of the partnership or other ownership
interests are at the time beneficially owned by such Person and/or one or
more of its Subsidiaries.
"SWAP AGREEMENT" means a written agreement between Borrowers and one or
more financial institutions providing for "swap", "cap", "collar" or other
interest rate protection with respect to any Indebtedness.
"TANGIBLE NET WORTH" means, as of any date of determination, the
Stockholders' Equity of Parent on that date MINUS the Intangible Assets of
Parent and its Subsidiaries on that date.
"TERM LOAN CONVERSION" means the conversion of all then outstanding
Committed Loans to a term loan pursuant to Section 2.10.
"TO THE BEST KNOWLEDGE OF" means, when modifying a representation,
warranty or other statement of any Person, that the fact or situation
described therein is known by the Person (or, in the case of a Person other
than a natural Person, known by a Responsible Official of that Person) making
the representation, warranty or other statement, or with the exercise of
reasonable due diligence under the circumstances (in accordance with the
standard of what a reasonable Person in similar circumstances would have
done) would have been known by the Person (or, in the case of a Person other
than a natural Person, would have been known by a Responsible Official of
that Person).
"TOTAL LIABILITIES" means, as of any date of determination, the total
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liabilities that are or should be reflected on a consolidated balance sheet
of Parent and its Subsidiaries prepared in accordance with Generally Accepted
Accounting Principles as of that date.
"TYPE", when used with respect to any Loan or Advance, means the
designation of whether such Loan or Advance is an Alternate Base Rate Loan or
Advance, or a Eurodollar Rate Loan or Advance.
"UNDEVELOPED PROPERTY" means all real property owned by Parent or a
Subsidiary of Parent that is not (a) a Stabilized Revenue-Producing Property
or (b) used exclusively for office purposes by Parent or a Subsidiary of
Parent.
"UNENCUMBERED" means, with respect to any Revenue-Producing Property,
that such Revenue-Producing Property (a) is not subject to any Lien OTHER
THAN Permitted Encumbrances, (b) is not subject to any Negative Pledge and
(c) is not held by a Person any of whose equity interests are subject to a
Lien or Negative Pledge in favor of any creditor of Parent or any of its
Subsidiaries.
"UNENCUMBERED ASSET POOL" means, as of any date of determination, (a)
the Initial Pool Properties, PLUS (b) each other Qualified Unencumbered Asset
Pool Property which has been added to the Unencumbered Asset Pool pursuant to
Section 2.11 as of such date, MINUS (c) any Revenue-Producing Property which
has been removed from the Unencumbered Asset Pool pursuant to Section 2.11 as
of such date.
"UNENCUMBERED ASSET POOL VALUE" means, as of the last day of each Fiscal
Quarter, the value obtained by DIVIDING (a) the Annualized Adjusted NOI of
the Revenue-Producing Properties in the Unencumbered Asset Pool for the
fiscal period consisting of that Fiscal Quarter and the three immediately
preceding Fiscal Quarters BY (b) the then effective Capitalization Rate.
"WHOLLY-OWNED SUBSIDIARY" means a Subsidiary of Parent, 100% of the
capital stock or other equity interest of which is owned, directly or
indirectly, by Parent, EXCEPT for director's qualifying shares required by
applicable Laws.
1.2 USE OF DEFINED TERMS. Any defined term used in the plural shall
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refer to all members of the relevant class, and any defined term used in the
singular shall refer to any one or more of the members of the relevant class.
1.3 ACCOUNTING TERMS. All accounting terms not specifically defined in
this Agreement shall be construed in conformity with, and all financial data
required to be submitted by this Agreement shall be prepared in conformity
with, Generally Accepted Accounting Principles applied on a consistent basis,
EXCEPT as otherwise specifically prescribed herein. In the event that
Generally Accepted Accounting Principles change during the term of this
Agreement such that the covenants contained in Sections 6.5 through 6.14,
inclusive, would then be calculated in a different manner or with different
components, (a) Borrowers and the Banks agree to amend this Agreement in such
respects as are necessary to conform those covenants as criteria for
evaluating Borrowers' financial condition to substantially the same criteria
as were effective prior to such change in Generally Accepted Accounting
Principles and (b) Borrowers shall be deemed to be in compliance with the
covenants contained in the aforesaid Sections if and to the extent that
Borrowers would have been in compliance therewith under Generally Accepted
Accounting Principles as in effect immediately prior to such change, but
shall have the obligation to deliver each of the materials described in
ARTICLE 7 to the Managing Agent and the Banks, on the dates therein
specified, with financial data presented in a manner which conforms with
Generally Accepted Accounting Principles as in effect immediately prior to
such change.
1.4 ROUNDING. Any financial ratios required to be maintained by
Borrowers pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one
place more than the number of places by which such ratio is expressed in this
Agreement and rounding the result up or down to the nearest number (with a
round-up if there is no nearest number) to the number of places by which such
ratio is expressed in this Agreement.
1.5 EXHIBITS AND SCHEDULES. All Exhibits and Schedules to this
Agreement, either as originally existing or as the same may from time to time
be supplemented, modified or amended, are incorporated herein by this
reference. A matter disclosed on any Schedule shall be deemed disclosed on
all Schedules.
1.6 REFERENCES TO "BORROWERS AND THEIR SUBSIDIARIES". Any reference
herein to "Borrowers and their Subsidiaries" or the like shall refer solely
to Borrowers during such times, if any, as Borrowers shall have no
Subsidiaries.
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1.7 MISCELLANEOUS TERMS. The term "or" is disjunctive; the term "and"
is conjunctive. The term "shall" is mandatory; the term "may" is permissive.
Masculine terms also apply to females; feminine terms also apply to males.
The term "including" is by way of example and not limitation.
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Article 2
LOANS
2.1 COMMITTED LOANS-GENERAL.
(a) Subject to the terms and conditions set forth in this
Agreement, at any time and from time to time from the Closing Date
through the Revolver Termination Date, each Bank shall, pro rata
according to that Bank's Pro Rata Share of the then applicable Line A
Commitment, make Advances to Borrowers under the Line A Commitment in
such amounts as Borrowers may request that do not result in (i) the
aggregate principal amount outstanding under the Line A Notes to exceed
the Line A Commitment or (ii) the aggregate principal amount outstanding
under the Notes to exceed the LESSER OF (A) the SUM OF the Line A
Commitment PLUS the Activated Line B Commitment or (B) the Borrowing
Base. Subject to the limitations set forth herein, Borrowers may borrow,
repay and reborrow under the Line A Commitment without premium or
penalty.
(b) Borrowers may at any time activate all or a portion (in
amounts that are an integral multiple of $1,000,000 and not less than
$10,0000,000) of the Line B Commitment upon written notice to that
effect to the Managing Agent accompanied by payment of the activation
fee then due and payable pursuant to Section 3.3; PROVIDED that (i) no
Event of Default then exists and (ii) no more than five (5) such
activations may be made. Subject to the terms and conditions set forth
in this Agreement, at any time and from time to time from the Closing
Date through the Revolver Termination Date, each Bank shall, pro rata
according to that Bank's Pro Rata Share of the then applicable Line B
Commitment, make Advances to Borrowers under the Activated Line B
Commitment in such amounts as Borrowers may request that do not result
in (i) the aggregate principal amount outstanding under the Line B Notes
to exceed the Activated Line B Commitment or (ii) the aggregate
principal amount outstanding under the Notes to exceed the LESSER OF (A)
the SUM OF the Line A Commitment PLUS the Activated Line B Commitment or
(B) the Borrowing Base. Subject to the limitations set forth herein,
Borrowers may borrow, repay and reborrow under the Activated Line B
Commitment without premium or penalty.
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(c) Subject to the next sentence, each Loan shall be made pursuant
to a Request for Loan which shall specify the requested (i) date of such
Loan, (ii) type of Loan, (iii) amount of such Loan, and (iv) in the case
of a Eurodollar Rate Loan, the Interest Period for such Loan. Unless
the Managing Agent has notified, in its sole and absolute discretion,
Borrowers to the contrary, a Loan may be requested by telephone by a
Responsible Official of Borrowers, in which case Borrowers shall confirm
such request by promptly delivering a Request for Loan in person or by
telecopier conforming to the preceding sentence to the Managing Agent.
Managing Agent shall incur no liability whatsoever hereunder in acting
upon any telephonic request for Loan purportedly made by a Responsible
Official of Borrowers, and Borrowers hereby agree to indemnify the
Managing Agent from any loss, cost, expense or liability as a result of
so acting.
(d) Promptly following receipt of a Request for Loan, the Managing
Agent shall notify each Bank by telephone or telecopier (and if by
telephone, promptly confirmed by telecopier) of the date and type of the
Loan, the applicable Interest Period, and that Bank's Pro Rata Share of
the Loan. Not later than 10:00 a.m., California time, on the date
specified for any Loan (which must be a Banking Day), each Bank shall
make its Pro Rata Share of the Loan in immediately available funds
available to the Managing Agent at the Managing Agent's Office. Upon
satisfaction or waiver of the applicable conditions set forth in
ARTICLE 8, all Advances shall be credited on that date in immediately
available funds to the Designated Deposit Account.
(e) Unless the Requisite Banks otherwise consent, each Alternate
Base Rate Loan shall be not less than $2,000,000, each Eurodollar Rate
Loan shall be not less than $5,000,000 and all Loans shall be in an
integral multiple of $1,000,000.
(f) The Advances made by each Bank under the Line A Commitment
shall be evidenced by that Bank's Line A Note. The Advances made by
each Bank under the Line B Commitment shall be evidenced by that Bank's
Line B Note.
(g) A Request for Loan shall be irrevocable upon the
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Managing Agent's first notification thereof.
(h) If no Request for Loan (or telephonic request for Loan
referred to in the second sentence of Section 2.1(C), if applicable) has
been made within the requisite notice periods set forth in Section 2.2
or 2.3 prior to the end of the Interest Period for any Eurodollar Rate
Loan, then on the last day of such Interest Period, such Eurodollar Rate
Loan shall be automatically converted into an Alternate Base Rate Loan
in the same amount.
2.2 ALTERNATE BASE RATE LOANS. Each request by Borrowers for an
Alternate Base Rate Loan shall be made pursuant to a Request for Loan (or
telephonic or other request for loan referred to in the second sentence of
Section 2.1(C), if applicable) received by the Managing Agent, at the
Managing Agent's Office, not later than 11:00 a.m. California time, on the
date (which must be a Banking Day) prior to the date of the requested
Alternate Base Rate Loan. All Loans shall constitute Alternate Base Rate
Loans unless properly designated as a Eurodollar Rate Loan pursuant to
Section 2.3.
2.3 EURODOLLAR RATE LOANS.
(a) Each request by Borrowers for a Eurodollar Rate Loan shall be
made pursuant to a Request for Loan (or telephonic or other request for
Loan referred to in the second sentence of Section 2.1(C), if
applicable) received by the Managing Agent, at the Managing Agent's
Office, not later than 9:00 a.m., California time, at least three
(3) Eurodollar Banking Days before the first day of the applicable
Eurodollar Period.
(b) On the date which is two (2) Eurodollar Banking Days before
the first day of the applicable Eurodollar Period, the Managing Agent
shall confirm its determination of the applicable Eurodollar Rate (which
determination shall be conclusive in the absence of manifest error) and
promptly shall give notice of the same to Borrowers and the Banks by
telephone or telecopier (and if by telephone, promptly confirmed by
telecopier).
(c) Unless the Managing Agent and the Requisite Banks otherwise
consent, no more than ten (10) Eurodollar Rate Loans shall be
outstanding at any one time.
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(d) No Eurodollar Rate Loan may be requested during the
continuation of a Default or Event of Default.
(e) Nothing contained herein shall require any Bank to fund any
Eurodollar Rate Advance in the Designated Eurodollar Market.
2.4 COMPETITIVE ADVANCES.
(a) Subject to the terms and conditions hereof, at any time and
from time to time from the Closing Date through the Revolver Termination
Date, each Bank may in its sole and absolute discretion make Competitive
Advances to Borrower in such principal amounts as Borrowers may request
pursuant to a Competitive Bid Request that do not result in (i) the
aggregate principal amount outstanding under the Competitive Advance
Notes being in excess of the GREATER OF (A) $35,000,000 or (B) an amount
equal to 33 1/3% of the SUM OF the Line A Commitment PLUS the Activated
Line B Commitment or (ii) the aggregate principal amount outstanding
under the Notes to exceed the LESSER OF (A) the SUM OF the Line A
Commitment PLUS the Activated Line B Commitment or (B) the Borrowing
Base.
(b) Borrowers shall request Competitive Advances by submitting a
Competitive Bid Request to the Managing Agent, which Competitive Bid
Request shall specify the relevant date, amount and maturity for the
proposed Competitive Advance and shall state whether a Competitive Bid
is requested on the basis of a fixed interest rate (an "Absolute Rate
Bid") or on the basis of a margin over the Eurodollar Rate (a
"Eurodollar Margin Bid") and which shall be accompanied by payment of a
nonrefundable $2500 competitive bid request fee for the account of the
Managing Agent. Any Competitive Bid Request made by telephone shall
promptly be confirmed by the delivery to the Managing Agent in person or
by telecopier of a written Competitive Bid Request. The Managing Agent
shall incur no liability whatsoever hereunder in acting upon any
telephonic Competitive Bid Request purportedly made by a Responsible
Official of Borrowers, which hereby agrees to indemnify the Managing
Agent from any loss, cost, expense or liability as a result of so
acting. The Competitive Bid Request must be received by the Managing
Agent not later than 9:15 a.m. California time on a Banking Day that is
at least one (1) Banking Day prior to the date of the proposed
Competitive
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Advance if an Absolute Rate Bid is requested; if a Eurodollar Margin Bid
is requested, it must be received by the Administrative Agent at least
five (5) Banking Days prior to the date of the proposed Competitive
Advance.
(c) Unless the Managing Agent otherwise agrees, in its sole and
absolute discretion, no Competitive Bid Request shall be made by
Borrowers if Borrowers have within the current calendar month submitted
five (5) or more Competitive Bid Requests.
(d) Each Competitive Bid Request must be made for a Competitive
Advance of at least $10,000,000 and shall be in an integral multiple of
$1,000,000.
(e) No Competitive Bid Request shall be made for a Competitive
Advance with a maturity of less than 7 days or more than 180 days, or
with a maturity date subsequent to the Maturity Date.
(f) The Managing Agent shall, promptly after receipt of a
Competitive Bid Request, notify the Banks thereof by telephone and
provide the Banks a copy thereof by telecopier. Any Bank may, by
written notice to the Managing Agent, advise the Managing Agent that it
elects not to be so notified of Competitive Bid Requests, in which case
the Managing Agent shall not notify such Bank of the Competitive Bid
Request.
(g) Each Bank receiving a Competitive Bid Request may, in its sole
and absolute discretion, make or not make a Competitive Bid responsive
to the Competitive Bid Request. Each Competitive Bid shall be submitted
to the Managing Agent not later than 7:30 a.m. (or, in the case of the
Domestic Reference Bank, not later than 7:15 a.m.) California time, in
the case of a Eurodollar Margin Bid, on the date which is four (4) Banking
Days prior to the requested Competitive Advance and, in the case of an
Absolute Rate Bid, on the date of the requested Competitive Advance. Any
Competitive Bid received by the Managing Agent after 7:30 a.m. (or
7:15 a.m. in the case of the Domestic Reference Bank) on such date shall
be disregarded for purposes of this Agreement. Any Competitive Bid made
by telephone shall promptly be confirmed by the delivery to the Managing
Agent in person or by telecopier of a written Competitive Bid. The
Managing Agent shall incur no liability whatsoever hereunder in acting
upon any telephonic Competitive Bid
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purportedly made by a Responsible Official of a Bank, each of which hereby
agrees to indemnify the Managing Agent from any loss, cost, expense or
liability as a result of so acting with respect to that Bank.
(h) Each Competitive Bid shall specify the fixed interest rate or
the margin over the Eurodollar Rate, as applicable, for the offered
Maximum Competitive Advance set forth in the Competitive Bid. The
Maximum Competitive Advance offered by a Bank in a Competitive Bid may
be less than the Competitive Advance requested by Borrower in the
Competitive Bid Request, but shall be an integral multiple of
$1,000,000. Any Competitive Bid which offers an interest rate OTHER
THAN a fixed interest rate or a margin over the Eurodollar Rate, is in a
form other than set forth in EXHIBIT C or which otherwise contains any
term, condition or provision not contained in the Competitive Bid
Request shall be disregarded for purposes of this Agreement. A
Competitive Bid once submitted to the Managing Agent shall be
irrevocable until 8:30 a.m. California time, in the case of a Eurodollar
Margin Bid, on the date which is three (3) Banking Days prior to the
requested Competitive Advance and, in the case of an Absolute Rate Bid,
on the date of the proposed Competitive Advance set forth in the related
Competitive Bid Request, and shall expire by its terms at such time
unless accepted by Borrower prior thereto.
(i) Promptly after 7:30 a.m. California time, in the case of a
Eurodollar Margin Bid, on the date which is four (4) Banking Days prior
to the date of the proposed Competitive Advance and, in the case of an
Absolute Rate Bid, on the date of the proposed Competitive Advance, the
Managing Agent shall notify Borrowers of the names of the Banks
providing Competitive Bids to the Managing Agent at or before 7:30 a.m.
on that date (or 7:15 a.m. in the case of the Domestic Reference Bank)
and the Maximum Competitive Advance and fixed interest rate or margin
over the Eurodollar Rate set forth by each such Bank in its Competitive
Bid. The Managing Agent shall promptly confirm such notification in
writing delivered in person or by telecopier to Borrower.
(j) Borrowers may, in their sole and absolute discretion, reject
any or all of the Competitive Bids. If Borrowers accept any Competitive
Bid, the following shall apply: (i) Borrowers must accept all Absolute
Rate Bids at all lower fixed interest rates before accepting any portion
of an Absolute Rate Bid at a higher fixed interest rate, (ii) Borrowers
must accept all Eurodollar Margin Bids at all lower margins over the
Eurodollar Rate before accepting any
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portion of a Eurodollar Margin Bid at a higher margin over the Eurodollar
Rate, (iii) if two or more Banks have submitted a Competitive Bid at the
same fixed interest rate or margin, then Borrowers must accept either all
of such Competitive Bids or accept such Competitive Bids in the same
proportion as the Maximum Competitive Advance of each Bank bears to the
aggregate Maximum Competitive Advances of all such Banks, and
(iv) Borrowers may not accept Competitive Bids for an aggregate amount in
excess of the requested Competitive Advance set forth in the Competitive
Bid Request. Acceptance by Borrowers of a Eurodollar Margin Rate Bid must
be made prior to 8:30 a.m. on the date which is three (3) Banking Days
prior to the requested Competitive Advance and acceptance by Borrower of
an Absolute Rate Bid must be made prior to 8:30 a.m. on the date of the
requested Competitive Advance. Acceptance of a Competitive Bid by
Borrowers shall be accomplished by notification thereof to the Managing
Agent and shall be irrevocable upon such notification. The Managing
Agent shall promptly notify each of the Banks whose Competitive Bid has
been accepted by Borrowers by telephone, which notification shall
promptly be confirmed in writing delivered in person or by telecopier to
such Banks. Any Competitive Bid not accepted by Borrowers by 8:30 a.m.,
in the case of a Eurodollar Margin Bid, on the date which is three (3)
Banking Days prior to the proposed Competitive Advance or, in the case
of an Absolute Rate Bid, on the date of the proposed Competitive Bid,
shall be deemed rejected.
(k) In the case of a Eurodollar Margin Bid, the Managing Agent
shall determine the Eurodollar Rate on the date which is two
(2) Eurodollar Banking Days prior to the date of the proposed Competitive
Advance, and shall promptly thereafter notify Borrowers and the Banks
whose Eurodollar Margin Bids were accepted by Borrowers of such
Eurodollar Rate.
(l) A Bank whose Competitive Bid has been accepted by Borrowers
shall make the Competitive Advance in accordance with the Competitive
Bid Request and with its Competitive Bid, subject to the applicable
conditions set forth in this Agreement, by making funds immediately
available to the Managing Agent at the Managing Agent's Office in the
amount of such Competitive Advance not later than 12:00 noon, California
time, on the date set forth in the Competitive Bid Request. The
Managing Agent shall then promptly credit the Competitive Advance in
immediately available funds to the
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Designated Deposit Account.
(m) The Managing Agent shall notify Borrowers and the Banks
promptly after any Competitive Advance is made of the amounts and
maturity of such Competitive Advances and the identity of the Banks
making such Competitive Advances.
(n) The Competitive Advances made by a Bank shall be evidenced by
that Bank's Competitive Advance Note.
(o) No Competitive Advance may be prepaid without the prior
written consent of the affected Bank.
2.5 VOLUNTARY REDUCTION OF COMMITMENTS. Borrowers shall have the
right, at any time and from time to time, without penalty or charge, upon at
least three (3) Banking Days' prior written notice by a Responsible Official
of Borrowers to the Managing Agent, voluntarily to reduce, permanently and
irrevocably, in aggregate principal amounts in an integral multiple of
$1,000,000 but not less than $5,000,000, or to terminate, all or a portion of
the then undisbursed portion of the Commitments. The Managing Agent shall
promptly notify the Banks of any reduction or termination of the Commitments
under this Section.
2.6 AUTOMATIC REDUCTION OF COMMITMENTS. On each Amortization Date, the
Commitments shall automatically be reduced by the applicable Amortization
Amount.
2.7 OPTIONAL TERMINATION OF COMMITMENTS. Following the occurrence of a
Change in Control, the Requisite Banks may in their sole and absolute
discretion elect, during the thirty (30) day period immediately subsequent to
the LATER OF (a) such occurrence or (b) the EARLIER of (i) receipt of
Borrowers' written notice to the Managing Agent of such occurrence or (ii) if
no such notice has been received by the Managing Agent, the date upon which
the Managing Agent has actual knowledge thereof, to terminate the
Commitments, in which case the Commitments shall be terminated effective on
the date which is thirty (30) days subsequent to written notice from the
Managing Agent to Borrowers thereof.
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2.8 MANAGING AGENT'S RIGHT TO ASSUME FUNDS AVAILABLE FOR ADVANCES.
Unless the Managing Agent shall have been notified by any Bank no later than
10:00 a.m. on the Banking Day of the proposed funding by the Managing Agent
of any Loan that such Bank does not intend to make available to the Managing
Agent such Bank's portion of the total amount of such Loan, the Managing
Agent may assume that such Bank has made such amount available to the
Managing Agent on the date of the Loan and the Managing Agent may, in
reliance upon such assumption, make available to Borrowers a corresponding
amount. If the Managing Agent has made funds available to Borrowers based on
such assumption and such corresponding amount is not in fact made available
to the Managing Agent by such Bank, the Managing Agent shall be entitled to
recover such corresponding amount on demand from such Bank. If such Bank
does not pay such corresponding amount forthwith upon the Managing Agent's
demand therefor, the Managing Agent promptly shall notify Borrowers and
Borrowers shall pay such corresponding amount to the Managing Agent. The
Managing Agent also shall be entitled to recover from such Bank interest on
such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Managing Agent to Borrowers to
the date such corresponding amount is recovered by the Managing Agent, at a
rate per annum equal to the daily Federal Funds Rate. Nothing herein shall
be deemed to relieve any Bank from its obligation to fulfill its share of the
Commitments or to prejudice any rights which the Managing Agent or Borrowers
may have against any Bank as a result of any default by such Bank hereunder.
2.9 EXTENSION OF REVOLVER TERMINATION DATE.
(a) The Revolver Termination Date may be extended for one-year
periods at the request of Borrowers and with the written consent of all
of the Banks (which may be withheld in the sole and absolute discretion
of each Bank) pursuant to this Section. Not earlier than June 1, 1998
nor later than July 1, 1998, or in the corresponding period in each
subsequent year, and provided that Borrowers are then in compliance with
Section 7.1, Borrowers may deliver to the Managing Agent and the Banks a
written request for a one year extension of the Revolver Termination
Date together with a Certificate of a Responsible Official signed by a
Senior Officer on behalf of Borrowers stating that the representations
and warranties contained in ARTICLE 4 (OTHER THAN (i) representations
and warranties which expressly speak as of a particular date
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or are no longer true and correct as a result of a change which is not a
violation of this Agreement and (ii) as otherwise disclosed by Borrowers
and approved in writing by the Requisite Banks are true and correct on and
as of the date of such Certificate). Each Bank shall, on or prior to
the date that is sixty (60) days after receipt of such written request,
notify in writing the Managing Agent whether (in its sole and absolute
discretion) it consents to such request and the Managing Agent shall,
after receiving the notifications from all of the Banks or the
expiration of such period, whichever is earlier, notify Borrowers and
the Banks of the results thereof. If all of the Banks have consented,
then the Revolver Termination Date shall be automatically extended for
one year upon payment by Borrowers to the Managing Agent of the
extension fee pursuant to Section 3.6.
(b) If Banks holding 80% or more of the Commitments (the
"Approving Banks") consent to the request for extension, but one or more
Banks (the "Disapproving Banks") notifies the Managing Agent that it
will not consent to the request for extension (or fails to notify the
Managing Agent in writing of its consent to the extension by the date
that is sixty (60) days after receipt of such written request),
Borrowers may at their option reduce the Commitments by an amount equal
to the amount thereof held by the Disapproving Banks, adjust the
Pro-Rata Shares (but not the amount) of the reduced Commitments of the
Approving Banks to correspond with the reduced Commitments and, subject
to the further written consent of all the Approving Banks, the Revolver
Termination Date shall automatically be extended for one year upon
payment by Borrowers to the Managing Agent of the extension fee pursuant
to Section 3.6.
(c) If Banks holding 80% or more of the Commitments do not consent
to the request for extension, Borrowers may, within the thirty (30) day
period following expiration of the aforesaid sixty (60) day period,
cause the Disapproving Banks to assign their Pro-Rata Shares of the
Commitments to an Eligible Assignee acceptable to Borrowers and the
Managing Agent pursuant to Section 11.25. Upon completion of such
assignments, the request for extension shall be renewed and, subject to
the written consent of all of the Banks (INCLUDING the new Banks), the
Revolver Termination Date shall automatically be extended for one year
upon payment by Borrowers to the Managing Agent of the extension fee
pursuant to Section 3.6.
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2.10 TERM LOAN CONVERSION. Borrowers may at any time elect to convert
the credit facility under this Agreement to a term loan by delivery of a
written notice to that effect to the Managing Agent and payment of the
extension fee payable pursuant to Section 3.6. The Line A Notes and the
Line A Notes will continue to evidence the outstanding Indebtedness incurred
under the Line A Commitment and the Line B Commitment subsequent to such
conversion. The term loan so elected shall commence on the Conversion Date
and shall be payable in Amortization Amounts on each Amortization Date.
2.11 UNENCUMBERED ASSET POOL. Borrowers may at any time add a Qualified
Unencumbered Asset Pool Property to the Unencumbered Asset Pool pursuant to
this Section 2.11, which process shall be initiated by delivery by Borrowers
to the Managing Agent (which the Managing Agent shall promptly distribute to
the Banks) of a complete description of the Qualified Unencumbered Asset Pool
Property, at least two (2) years of operating income statements related
thereto (to the extent available), a description of all tenants and leases
with respect thereto, a current written report prepared by a qualified
independent expert with respect to Hazardous Materials related thereto and
other written materials reasonably requested by any Bank. Thereafter:
(a) If at that date either of the Consent Criteria is satisfied,
the Qualified Unencumbered Asset Pool Property so described shall
thereupon become part of the Unencumbered Asset Pool; or
(b) If at that date neither of the Consent Criteria is satisfied,
the Qualified Unencumbered Asset Pool Property so described shall become
part of the Unencumbered Asset Pool on the tenth (10th) day after the
date the aforesaid descriptive materials are delivered to the Managing
Agent UNLESS on or before such day Banks holding 51% or more of the
Commitments have notified Borrowers and the Managing Agent in writing
that they object to the addition of such Qualified Unencumbered Asset
Pool Property to the Unencumbered Asset Pool, which notifications shall
state the reason or reasons for such objection.
Borrowers may remove a Revenue-Producing Property from the Unencumbered Asset
Pool by delivery to the Managing Agent (for distribution to the Banks) of a
written
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notice to that effect, accompanied by a Certificate of a Senior Officer of
Borrowers setting forth the revised Borrowing Base as of the most
recently-ended Fiscal Quarter resulting from such removal, which removal
shall be effective on the tenth (10th) day after the date of such notice.
2.12 REPRESENTATIVE OF BORROWERS. Each of Borrowers hereby appoints
Parent as its agent, attorney-in-fact and representative for the purpose of
making Requests for Loans, Competitive Bid Requests, acceptance of
Competitive Bids, payment and prepayment of Loans and Competitive Advances,
the giving and receipt of notices by and to Borrowers under this Agreement
and all other purposes incidental to any of the foregoing. Each of Borrowers
agrees that any action taken by Parent as the agent, attorney-in-fact and
representative of such Borrower shall be binding on such Borrowers to the
same extent as if directly taken by such Borrower.
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Article 3
PAYMENTS AND FEES
3.1 PRINCIPAL AND INTEREST.
(a) Interest shall be payable on the outstanding daily unpaid
principal amount of each Advance from the date thereof until payment in
full is made and shall accrue and be payable at the rates set forth or
provided for herein before and after Default, before and after maturity,
before and after judgment, and before and after the commencement of any
proceeding under any Debtor Relief Law, with interest on overdue
interest at the Default Rate to the fullest extent permitted by
applicable Laws.
(b) Interest accrued on each Alternate Base Rate Loan shall be due
and payable on each Monthly Payment Date. EXCEPT as otherwise provided
in Section 3.9, the unpaid principal amount of any Alternate Base Rate
Loan shall bear interest at a fluctuating rate per annum equal to the
Alternate Base Rate PLUS the Applicable Alternate Base Rate Margin.
Each change in the interest rate under this Section 3.1(b) due to a
change in the Alternate Base Rate shall take effect simultaneously with
the corresponding change in the Alternate Base Rate.
(c) Interest accrued on each Eurodollar Rate Loan shall be due and
payable on each Monthly Payment Date. EXCEPT as otherwise provided in
Section 3.9, the unpaid principal amount of any Eurodollar Rate Loan
shall bear interest at a rate per annum equal to the Eurodollar Rate for
that Eurodollar Rate Loan PLUS the Applicable Eurodollar Rate Margin.
(d) If not sooner paid, the principal Indebtedness evidenced by
the Notes shall be payable as follows:
(i) the amount, if any, by which (A) the principal
Indebtedness evidenced by the Line A Notes at any time exceeds the
then applicable Line A Commitment or (B) the principal Indebtedness
evidenced by the Line B Notes at any time exceeds the then applicable
Line B Commitment, shall in each case be payable immediately;
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(ii) the amount, if any, by which the principal Indebtedness
evidenced by the Notes at any time exceeds the SUM OF the Line A
Commitment PLUS the Activated Line B Commitment shall be payable
immediately;
(iii) the amount, if any, by which the principal Indebtedness
evidenced by the Notes at any time exceeds the Borrowing Base shall
(A) if the Net Leverage Amount is then the determinative component of
the Borrowing Base, be payable immediately and (B) if the Net
Mortgage Amount is then the determinative component of the Borrowing
Base, be payable as follows:
(aa) immediately, in an amount equal to the excess of such
Indebtedness over the Net Mortgage Amount assuming that
the related Mortgage Amount was calculated with a Support
Multiple (as such term is used in the definition of
Mortgage Amount) of 180%, rather than 200%;
(bb) concurrently with the determination of the Net Mortgage
Amount for the next following Fiscal Quarter, in an
amount equal to the excess of such Indebtedness over the
Net Mortgage Amount assuming that the related Mortgage
Amount was calculated with a Support Multiple of 190%,
rather than 200%; and
(cc) concurrently with the determination of the Net Mortgage
Amount for the next following Fiscal Quarter, in an
amount equal to the excess of such Indebtedness over the
Net Mortgage Amount;
(iv) the principal Indebtedness evidenced by each Competitive
Advance Note shall be payable on the maturity date of each Competitive
Advance in the amount of such Competitive Advance; and
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(v) the principal Indebtedness evidenced by the Notes shall in
any event be payable on the Maturity Date.
(e) The Notes may, at any time and from time to time, voluntarily
be paid or prepaid in whole or in part without premium or penalty,
EXCEPT that with respect to any voluntary prepayment under this Section,
(i) any partial prepayment shall be not less than $2,000,000, (ii) the
Managing Agent shall have received written notice of any prepayment by
9:00 a.m. California time on the date of prepayment (which must be a
Banking Day) in the case of an Alternate Base Rate Loan, and, in the
case of a Eurodollar Rate Loan, three (3) Banking Days before the date
of prepayment, which notice shall identify the date and amount of the
prepayment and the Loan(s) being prepaid, (iii) each prepayment of
principal on any Eurodollar Rate Loan shall be accompanied by payment of
interest accrued to the date of payment on the amount of principal paid,
(iv) any payment or prepayment of all or any part of any Eurodollar Rate
Loan on a day other than the last day of the applicable Interest Period
shall be subject to Section 3.8(e) and (v) upon any partial prepayment
of a Eurodollar Rate Loan that reduces it below $5,000,000, the
remaining portion thereof shall automatically convert to an Alternate
Base Rate Loan.
3.2 ARRANGEMENT FEE. On the Closing Date, Borrowers shall pay to the
Managing Agent the balance of the arrangement fee as heretofore agreed upon
by letter agreement between Borrowers and the Managing Agent. The
arrangement fee paid to the Managing Agent is solely for its own account and
is nonrefundable.
3.3 LINE B COMMITMENT ACTIVATION FEE. On each activation of all or a
portion of the Line B Commitment, Borrowers shall pay to the Managing Agent,
for the respective accounts of the Banks pro rata according to their Pro Rata
Share of the Commitments, an activation fee of .25% (25 basis points) TIMES
the amount of the Line B Commitment then so activated.
3.4 COMMITMENT FEE. From the Closing Date through the Revolver
Termination Date, Borrowers shall pay to the Managing Agent, for the ratable
accounts of the Banks pro rata according to their Pro Rata Share of the
Commitments, a commitment fee equal to the daily Applicable Commitment Fee
Rate per annum TIMES the average daily amount by which the Line A Commitment
plus the Activated Line B Commitment exceed the aggregate daily principal
Indebtedness evidenced by the
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Line A Notes and the Line B Notes. The commitment fee shall be payable
quarterly in arrears on each Quarterly Payment Date and on the Revolver
Termination Date.
3.5 AGENCY FEE. Borrowers shall pay to the Managing Agent an
agency fee in such amounts and at such times as heretofore agreed upon by
letter agreement between Borrowers and the Managing Agent. The agency fee
paid to the Managing Agent is solely for its own account and is nonrefundable.
3.6 EXTENSION FEES. Borrowers shall pay to the Managing Agent, for
the respective accounts of the Banks pro rata according to their Pro Rata
Share of the Commitments, an extension fee of .125% (12.5 basis points) TIMES
the Line A Commitment and the Activated Line B Commitment concurrently with
(a) each extension of the Revolver Termination Date pursuant to Section 2.9
and (b) its election to effect the Term Loan Conversion pursuant to Section
2.10.
3.7 INCREASED COMMITMENT COSTS. If any Bank shall determine in
good faith that the introduction after the Closing Date of any applicable
law, rule, regulation or guideline regarding capital adequacy, or any change
therein or any change in the interpretation or administration thereof by any
central bank or other Governmental Agency charged with the interpretation or
administration thereof, or compliance by such Bank (or its Eurodollar Lending
Office) or any corporation controlling such Bank, with any request, guideline
or directive regarding capital adequacy (whether or not having the force of
Law) of any such central bank or other authority not imposed as a result of
such Bank's or such corporation's failure to comply with any other Laws,
affects or would affect the amount of capital required or expected to be
maintained by such Bank or any corporation controlling such Bank and (taking
into consideration such Bank's or such corporation's policies with respect to
capital adequacy and such Bank's desired return on capital) determines in
good faith that the amount of such capital is increased, or the rate of
return on capital is reduced, as a consequence of its obligations under this
Agreement, then, within ten (10) Banking Days after demand of such Bank,
Borrowers shall pay to such Bank, from time to time as specified in good
faith by such Bank, additional amounts sufficient to compensate such Bank in
light of such circumstances, to the extent reasonably allocable to such
obligations under this Agreement, PROVIDED that Borrowers shall not be
obligated to pay any such amount which arose prior to the date which is
ninety (90) days preceding the date of such demand or is attributable to
periods prior to the date which is ninety (90) days preceding the date of
such demand. Each Bank's determination of such amounts shall
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be conclusive in the absence of manifest error.
3.8 EURODOLLAR COSTS AND RELATED MATTERS.
(a) In the event that any Governmental Agency imposes on any
Bank any reserve or comparable requirement (INCLUDING any emergency,
supplemental or other reserve) with respect to the Eurodollar
Obligations of that Bank, Borrowers shall pay that Bank within five (5)
Banking Days after demand all amounts necessary to compensate such Bank
(determined as though such Bank's Eurodollar Lending Office had funded
100% of its Eurodollar Rate Advance in the Designated Eurodollar Market)
in respect of the imposition of such reserve requirements (PROVIDED,
that Borrowers shall not be obligated to pay any such amount which arose
prior to the date which is ninety (90) days preceding the date of such
demand or is attributable to periods prior to the date which is ninety
(90) days preceding the date of such demand). The Bank's determination
of such amount shall be conclusive in the absence of manifest error.
(b) If, after the date hereof, the existence or occurrence of
any Special Eurodollar Circumstance:
(1) shall subject any Bank or its Eurodollar Lending
Office to any tax, duty or other charge or cost with respect to any
Eurodollar Rate Advance, any of its Notes evidencing Eurodollar
Rate Loans or its obligation to make Eurodollar Rate Advances, or
shall change the basis of taxation of payments to any Bank
attributable to the principal of or interest on any Eurodollar Rate
Advance or any other amounts due under this Agreement in respect of
any Eurodollar Rate Advance, any of its Notes evidencing Eurodollar
Rate Loans or its obligation to make Eurodollar Rate Advances
(PROVIDED, that Borrowers shall not be obligated to pay any such
amount which arose prior to the date which is ninety (90) days
preceding the date of such demand or is attributable to periods
prior to the date which is ninety (90) days preceding the date of
such demand), EXCLUDING (i) taxes imposed on or measured in whole
or in part by its overall net income by (A) any jurisdiction (or
political subdivision thereof) in which it is organized or
maintains its principal office or Eurodollar Lending Office or (B)
any
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jurisdiction (or political subdivision thereof) in which it is
"doing business" and (ii) any withholding taxes or other taxes
based on gross income imposed by the United States of America for
any period with respect to which it has failed to provide Borrowers
with the appropriate form or forms required by Section 11.21, to
the extent such forms are then required by applicable Laws;
(2) shall impose, modify or deem applicable any reserve not
applicable or deemed applicable on the date hereof (INCLUDING any
reserve imposed by the Board of Governors of the Federal Reserve
System, special deposit, capital or similar requirements against
assets of, deposits with or for the account of, or credit extended
by, any Bank or its Eurodollar Lending Office); or
(3) shall impose on any Bank or its Eurodollar Lending Office
or the Designated Eurodollar Market any other condition affecting
any Eurodollar Rate Advance, any of its Notes evidencing Eurodollar
Rate Loans, its obligation to make Eurodollar Rate Advances or this
Agreement, or shall otherwise affect any of the same;
and the result of any of the foregoing, as determined in good faith by
such Bank, increases the cost to such Bank or its Eurodollar Lending
Office of making or maintaining any Eurodollar Rate Advance or in
respect of any Eurodollar Rate Advance, any of its Notes evidencing
Eurodollar Rate Loans or its obligation to make Eurodollar Rate Advances
or reduces the amount of any sum received or receivable by such Bank or
its Eurodollar Lending Office with respect to any Eurodollar Rate
Advance, any of its Notes evidencing Eurodollar Rate Loans or its
obligation to make Eurodollar Rate Advances (assuming such Bank's
Eurodollar Lending Office had funded 100% of its Eurodollar Rate Advance
in the Designated Eurodollar Market), then, within five (5) Banking Days
after demand by such Bank (with a copy to the Managing Agent), Borrowers
shall pay to such Bank such additional amount or amounts as will
compensate such Bank for such increased cost or reduction (determined as
though such Bank's Eurodollar Lending Office had funded 100% of its
Eurodollar Rate Advance in the Designated Eurodollar Market). A
statement of any Bank claiming compensation under this subsection shall
be conclusive in the absence of manifest error.
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(c) If, after the date hereof, the existence or occurrence of any
Special Eurodollar Circumstance shall, in the good faith opinion of any
Bank, make it unlawful or impossible for such Bank or its Eurodollar
Lending Office to make, maintain or fund its portion of any Eurodollar
Rate Loan, or materially restrict the authority of such Bank to purchase
or sell, or to take deposits of, Dollars in the Designated Eurodollar
Market, or to determine or charge interest rates based upon the
Eurodollar Rate, and such Bank shall so notify the Managing Agent, then
such Bank's obligation to make Eurodollar Rate Advances shall be
suspended for the duration of such illegality or impossibility and the
Managing Agent forthwith shall give notice thereof to the other Banks
and Borrowers. Upon receipt of such notice, the outstanding principal
amount of such Bank's Eurodollar Rate Advances, together with accrued
interest thereon, automatically shall be converted to Alternate Base
Rate Advances on either (1) the last day of the Eurodollar Period(s)
applicable to such Eurodollar Rate Advances if such Bank may lawfully
continue to maintain and fund such Eurodollar Rate Advances to such
day(s) or (2) immediately if such Bank may not lawfully continue to fund
and maintain such Eurodollar Rate Advances to such day(s), PROVIDED that
in such event the conversion shall not be subject to payment of a
prepayment fee under Section 3.8(e). Each Bank agrees to endeavor
promptly to notify Borrowers of any event of which it has actual
knowledge, occurring after the Closing Date, which will cause that Bank
to notify the Managing Agent under this Section, and agrees to designate
a different Eurodollar Lending Office if such designation will avoid the
need for such notice and will not, in the good faith judgment of such
Bank, otherwise be materially disadvantageous to such Bank. In the
event that any Bank is unable, for the reasons set forth above, to make,
maintain or fund its portion of any Eurodollar Rate Loan, such Bank
shall fund such amount as an Alternate Base Rate Advance for the same
period of time, and such amount shall be treated in all respects as an
Alternate Base Rate Advance. Any Bank whose obligation to make
Eurodollar Rate Advances has been suspended under this Section shall
promptly notify the Managing Agent and Borrowers of the cessation of the
Special Eurodollar Circumstance which gave rise to such suspension.
(d) If, with respect to any proposed Eurodollar Rate Loan:
(1) the Managing Agent reasonably determines that, by
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reason of circumstances affecting the Designated Eurodollar Market
generally that are beyond the reasonable control of the Banks,
deposits in Dollars (in the applicable amounts) are not being
offered to any Bank in the Designated Eurodollar Market for the
applicable Eurodollar Period; or
(2) the Requisite Banks advise the Managing Agent that the
Eurodollar Rate as determined by the Managing Agent (i) does not
represent the effective pricing to such Banks for deposits in
Dollars in the Designated Eurodollar Market in the relevant amount
for the applicable Eurodollar Period, or (ii) will not adequately
and fairly reflect the cost to such Banks of making the applicable
Eurodollar Rate Advances;
then the Managing Agent forthwith shall give notice thereof to Borrowers
and the Banks, whereupon until the Managing Agent notifies Borrowers
that the circumstances giving rise to such suspension no longer exist,
the obligation of the Banks to make any future Eurodollar Rate Advances
shall be suspended.
(e) Upon payment or prepayment of any Eurodollar Rate Advance
(OTHER THAN as the result of a conversion required under Section 3.8(c)
on a day other than the last day in the applicable Eurodollar Period
(whether voluntarily, involuntarily, by reason of acceleration, or
otherwise), or upon the failure of Borrowers (for a reason other than
the breach by a Bank of its obligation pursuant to Sections 2.1(a) or
2.1(b) to make an Advance) to borrow on the date or in the amount
specified for a Eurodollar Rate Loan in any Request for Loan, Borrowers
shall pay to the appropriate Bank within ten (10) Banking Days after
demand a prepayment fee or failure to borrow fee, as the case may be
(determined as though 100% of the Eurodollar Rate Advance had been
funded in the Designated Eurodollar Market) equal to the SUM of:
(1) $250; PLUS
(2) the amount, if any, by which (i) the additional interest
would have accrued on the amount prepaid or not borrowed at the
Eurodollar Rate PLUS the Applicable Eurodollar Rate Margin if that
amount had remained or been outstanding through the last day of the
applicable Interest Period EXCEEDS (ii) the interest that the Bank
could
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recover by placing such amount on deposit in the Designated
Eurodollar Market for a period beginning on the date of the
prepayment or failure to borrow and ending on the last day of the
applicable Interest Period (or, if no deposit rate quotation is
available for such period, for the most comparable period for which
a deposit rate quotation may be obtained); PLUS
(3) all out-of-pocket expenses incurred by the Bank reasonably
attributable to such payment, prepayment or failure to borrow.
Each Bank's determination of the amount of any prepayment fee
payable under this Section shall be conclusive in the absence of
manifest error.
(f) Each Bank agrees to endeavor promptly to notify Borrowers of
any event of which it has actual knowledge, occurring after the Closing
Date, which will entitle such Bank to compensation pursuant to clause
(a) or clause (b) of this Section 3.8, and agrees to designate a
different Eurodollar Lending Office if such designation will avoid the
need for or reduce the amount of such compensation and will not, in the
good faith judgment of such Bank, otherwise be materially
disadvantageous to such Bank. Any request for compensation by a Bank
under this Section 3.8 shall set forth the basis upon which it has been
determined that such an amount is due from Borrowers, a calculation of
the amount due, and a certification that the corresponding costs have
been incurred by the Bank.
3.9 LATE PAYMENTS. If any installment of principal or interest or any
fee or cost or other amount payable under any Loan Document to the Managing
Agent or any Bank is not paid when due, it shall thereafter bear interest at
a fluctuating interest rate per annum at all times equal to the SUM OF the
Alternate Base Rate PLUS the Applicable Alternate Base Rate Margin PLUS 2%,
to the fullest extent permitted by applicable Laws. Accrued and unpaid
interest on past due amounts (INCLUDING, without limitation, interest on past
due interest) shall be compounded monthly, on the last day of each calendar
month, to the fullest extent permitted by applicable Laws.
3.10 COMPUTATION OF INTEREST AND FEES. Computation of interest and fees
under this Agreement shall be calculated on the basis of a year of 360 days
and the
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actual number of days elapsed. Interest shall accrue on each Loan for the
day on which the Loan is made; interest shall not accrue on a Loan, or any
portion thereof, for the day on which the Loan or such portion is paid. Any
Loan that is repaid on the same day on which it is made shall bear interest
for one day. Notwithstanding anything in this Agreement to the contrary,
interest in excess of the maximum amount permitted by applicable Laws shall
not accrue or be payable hereunder or under the Notes, and any amount paid as
interest hereunder or under the Notes which would otherwise be in excess of
such maximum permitted amount shall instead be treated as a payment of
principal.
3.11 NON-BANKING DAYS. If any payment to be made by Borrowers or any
other Party under any Loan Document shall come due on a day other than a
Banking Day, payment shall instead be considered due on the next succeeding
Banking Day and the extension of time shall be reflected in computing
interest and fees.
3.12 MANNER AND TREATMENT OF PAYMENTS.
(a) Each payment hereunder (EXCEPT payments pursuant to Sections
3.7, 3.8, 11.3, 11.11 and 11.22) or on the Notes or under any other Loan
Document shall be made to the Managing Agent at the Managing Agent's
Office for the account of each of the Banks or the Managing Agent, as
the case may be, in immediately available funds not later than 11:00
a.m. California time, on the day of payment (which must be a Banking
Day). All payments received after such time, on any Banking Day, shall
be deemed received on the next succeeding Banking Day. The amount of
all payments received by the Managing Agent for the account of each Bank
shall be immediately paid by the Managing Agent to the applicable Bank
in immediately available funds and, if such payment was received by the
Managing Agent by 11:00 a.m., California time, on a Banking Day and not
so made available to the account of a Bank on that Banking Day, the
Managing Agent shall reimburse that Bank for the cost to such Bank of
funding the amount of such payment at the Federal Funds Rate. All
payments shall be made in lawful money of the United States of America.
(b) Each payment or prepayment on account of any Loan shall be applied
pro rata according to the outstanding Advances made by each Bank
comprising such Loan.
(c) Each Bank shall use its best efforts to keep a record (in
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writing or by an electronic data entry system) of Advances made by it
and payments received by it with respect to each of its Notes and,
subject to Section 10.6(g), such record shall, as against Borrowers, be
presumptive evidence of the amounts owing. Notwithstanding the foregoing
sentence, the failure by any Bank to keep such a record shall not affect
Borrowers' obligation to pay the Obligations.
(d) Each payment of any amount payable by Borrowers or any
other Party under this Agreement or any other Loan Document shall be
made free and clear of, and without reduction by reason of, any taxes,
assessments or other charges imposed by any Governmental Agency, central
bank or comparable authority, EXCLUDING (i) taxes imposed on or measured
in whole or in part by its overall net income by (A) any jurisdiction
(or political subdivision thereof) in which it is organized or maintains
its principal office or Eurodollar Lending Office or (B) any
jurisdiction (or political subdivision thereof) in which it is "doing
business" and (ii) any withholding taxes or other taxes based on gross
income imposed by the United States of America for any period with
respect to which it has failed to provide Borrowers with the appropriate
form or forms required by Section 11.21, to the extent such forms are
then required by applicable Laws (all such non-excluded taxes,
assessments or other charges being hereinafter referred to as "Taxes").
To the extent that Borrowers are obligated by applicable Laws to make
any deduction or withholding on account of Taxes from any amount payable
to any Bank under this Agreement, Borrowers shall (i) make such
deduction or withholding and pay the same to the relevant Governmental
Agency and (ii) pay such additional amount to that Bank as is necessary
to result in that Bank's receiving a net after-Tax amount equal to the
amount to which that Bank would have been entitled under this Agreement
absent such deduction or withholding. If and when receipt of such
payment results in an excess payment or credit to that Bank on account
of such Taxes, that Bank shall promptly refund such excess to Borrowers.
3.13 FUNDING SOURCES. Nothing in this Agreement shall be deemed to
obligate any Bank to obtain the funds for any Loan or Advance in any
particular place or manner or to constitute a representation by any Bank that
it has obtained or will obtain the funds for any Loan or Advance in any
particular place or manner.
3.14 FAILURE TO CHARGE NOT SUBSEQUENT WAIVER. Any decision by the
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Managing Agent or any Bank not to require payment of any interest (INCLUDING
interest arising under Section 3.9), fee, cost or other amount payable under
any Loan Document, or to calculate any amount payable by a particular method,
on any occasion shall in no way limit or be deemed a waiver of the Managing
Agent's or such Bank's right to require full payment of any interest
(INCLUDING interest arising under Section 3.9), fee, cost or other amount
payable under any Loan Document, or to calculate an amount payable by another
method that is not inconsistent with this Agreement, on any other or
subsequent occasion.
3.15 MANAGING AGENT'S RIGHT TO ASSUME PAYMENTS WILL BE MADE BY
BORROWERS. Unless the Managing Agent shall have been notified by Borrowers
prior to the date on which any payment to be made by Borrowers hereunder is
due that Borrowers do not intend to remit such payment, the Managing Agent
may, in its discretion, assume that Borrowers have remitted such payment when
so due and the Managing Agent may, in its discretion and in reliance upon
such assumption, make available to each Bank on such payment date an amount
equal to such Bank's share of such assumed payment. If Borrowers have not in
fact remitted such payment to the Managing Agent, each Bank shall forthwith
on demand repay to the Managing Agent the amount of such assumed payment made
available to such Bank, together with interest thereon in respect of each day
from and including the date such amount was made available by the Managing
Agent to such Bank to the date such amount is repaid to the Managing Agent at
the Federal Funds Rate.
3.16 FEE DETERMINATION DETAIL. The Managing Agent, and any Bank,
shall provide reasonable detail to Borrowers regarding the manner in which
the amount of any payment to the Managing Agent and the Banks, or that Bank,
under ARTICLE 3 has been determined, concurrently with demand for such
payment.
3.17 SURVIVABILITY. All of Borrowers' obligations under Sections
3.7 and 3.8 shall survive for the ninety (90) day period following the date
on which the Commitments are terminated and all Loans hereunder are fully
paid, and Borrowers shall remain obligated thereunder for all claims under
such Sections made by any Bank to Borrowers prior to the expiration of such
period.
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Article 4
REPRESENTATIONS AND WARRANTIES
Borrowers represent and warrant to the Banks that:
4.1 EXISTENCE AND QUALIFICATION; POWER; COMPLIANCE WITH LAWS.
Parent is a corporation duly formed, validly existing and in good standing
under the Laws of Maryland and each other Borrower is a corporation or
limited liability company duly formed, validly existing and in good standing
under the Laws of its state of formation. Each of Borrowers is duly
qualified or registered to transact business and is in good standing in each
other jurisdiction in which the conduct of its business or the ownership or
leasing of its Properties makes such qualification or registration necessary,
EXCEPT where the failure so to qualify or register and to be in good standing
would not constitute a Material Adverse Effect. Each of Borrowers has all
requisite power and authority to conduct its business, to own and lease its
Properties and to execute and deliver each Loan Document to which it is a
Party and to perform its Obligations. All outstanding shares of capital
stock of Parent are duly authorized, validly issued, fully paid and
non-assessable, and no holder thereof has any enforceable right of rescission
under any applicable state or federal securities Laws. Each of Borrowers is
in compliance with all Laws and other legal requirements applicable to its
business, has obtained all authorizations, consents, approvals, orders,
licenses and permits from, and has accomplished all filings, registrations
and qualifications with, or obtained exemptions from any of the foregoing
from, any Governmental Agency that are necessary for the transaction of its
business, EXCEPT where the failure so to comply, obtain authorizations, etc.,
file, register, qualify or obtain exemptions does not constitute a Material
Adverse Effect. Parent is a "real estate investment trust" within the
meaning of Section 856 of the Code.
4.2 AUTHORITY; COMPLIANCE WITH OTHER AGREEMENTS AND INSTRUMENTS AND
GOVERNMENT REGULATIONS. The execution, delivery and performance by each of
Borrowers of the Loan Documents to which it is a Party have been duly
authorized by all necessary corporate action, and do not and will not:
(a) Require any consent or approval not heretofore obtained of
any partner, director, stockholder, security holder or creditor of
Borrowers;
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(b) Violate or conflict with any provision of Borrowers'
charter, articles of incorporation or bylaws, as applicable;
(c) Result in or require the creation or imposition of any
Lien or Right of Others upon or with respect to any Property now owned
or leased or hereafter acquired by Borrowers;
(d) Violate any Requirement of Law applicable to Borrowers;
(e) Result in a breach of or constitute a default under, or
cause or permit the acceleration of any obligation owed under, any
indenture or loan or credit agreement or any other Contractual
Obligation to which Borrowers are a party or by which Borrowers or any
of their Property is bound or affected;
and none of Borrowers is in violation of, or default under, any Requirement
of Law or Contractual Obligation, or any indenture, loan or credit agreement
described in Section 4.2(e), in any respect that constitutes a Material
Adverse Effect.
4.3 NO GOVERNMENTAL APPROVALS REQUIRED. EXCEPT as previously
obtained or made, no authorization, consent, approval, order, license or
permit from, or filing, registration or qualification with, any Governmental
Agency is or will be required to authorize or permit under applicable Laws
the execution, delivery and performance by any of Borrowers of the Loan
Documents to which it is a Party.
4.4 SUBSIDIARIES. SCHEDULE 4.4 hereto correctly sets forth the
names, form of legal entity, number of shares of capital stock (or other
applicable unit of equity interest) issued and outstanding, and the record
owner thereof and jurisdictions of organization of all Subsidiaries of
Parent. Unless otherwise indicated in SCHEDULE 4.4, all of the outstanding
shares of capital stock, or all of the units of equity interest, as the case
may be, of each such Subsidiary are owned of record and beneficially by
Parent, there are no outstanding options, warrants or other rights to
purchase capital stock of any such Subsidiary, and all such shares or equity
interests so owned are duly authorized, validly issued, fully paid and
non-assessable, and were issued in compliance with all applicable state and
federal securities and other Laws, and are free and clear of all Liens and
Rights of Others, EXCEPT for Permitted Encumbrances and Permitted Rights of
Others.
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4.5 FINANCIAL STATEMENTS. Borrowers have furnished to the Banks
(a) the audited consolidated financial statements of Parent and its
Subsidiaries for the Fiscal Year ended December 31, 1996 and (b) the
unaudited consolidated balance sheet and statement of operations of Parent
and its Subsidiaries for the Fiscal Quarter ended March 31, 1997. The
financial statements described in clause (a) fairly present in all material
respects the financial condition, results of operations and changes in
financial position, and the balance sheet and statement of operations
described in clause (b) fairly present the financial condition and results of
operations of Parent and its Subsidiaries as of such dates and for such
periods in conformity with Generally Accepted Accounting Principles
consistently applied.
4.6 NO OTHER LIABILITIES; NO MATERIAL ADVERSE CHANGES. Borrowers
do not have any material liability or material contingent liability required
under Generally Accepted Accounting Principles to be reflected or disclosed,
and not reflected or disclosed, in the balance sheet described in
Section 4.5(b), OTHER THAN liabilities and contingent liabilities arising in
the ordinary course of business since the date of such financial statements.
As of the Closing Date, no circumstance or event has occurred that constitutes
a Material Adverse Effect since March 31, 1997. As of any date subsequent to
the Closing Date, no circumstance or event has occurred that constitutes a
Material Adverse Effect since the Closing Date.
4.7 TITLE TO PROPERTY. Borrowers have valid title to the Property
(OTHER THAN assets which are the subject of a Capital Lease Obligation)
reflected in the balance sheet described in Section 4.5(b), OTHER THAN items
of Property or exceptions to title which are in each case immaterial to
Borrowers and Property subsequently sold or disposed of in the ordinary
course of business. Such Property is free and clear of all Liens and Rights
of Others, OTHER THAN Liens or Rights of Others described in SCHEDULE 4.7 and
Permitted Encumbrances and Permitted Rights of Others.
4.8 INTANGIBLE ASSETS. Borrowers own, or possess the right to use
to the extent necessary in their respective businesses, all material
trademarks, trade names, copyrights, patents, patent rights, computer
software, licenses and other Intangible Assets that are used in the conduct
of their businesses as now operated, and no such Intangible Asset, to the
best knowledge of Borrowers, conflicts with the valid trademark, trade name,
copyright, patent, patent right or Intangible Asset of any other Person to
the extent that such conflict constitutes a Material Adverse Effect.
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4.9 PUBLIC UTILITY HOLDING COMPANY ACT. None of Borrowers is a
"holding company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of
1935, as amended.
4.10 LITIGATION. EXCEPT for (a) any matter fully covered as to
subject matter and amount (subject to applicable deductibles and retentions)
by insurance for which the insurance carrier has not asserted lack of subject
matter coverage or reserved its right to do so, (b) any matter, or series of
related matters, involving a claim against Parent or any of its Subsidiaries
of less than $1,000,000, (c) matters of an administrative nature not
involving a claim or charge against Parent or any of its Subsidiaries and (d)
matters set forth in SCHEDULE 4.10, there are no actions, suits, proceedings
or investigations pending as to which Parent or any of its Subsidiaries have
been served or have received notice or, to the best knowledge of Borrowers,
threatened against or affecting Parent or any of its Subsidiaries or any
Property of any of them before any Governmental Agency.
4.11 BINDING OBLIGATIONS. Each of the Loan Documents to which
Borrowers are a Party will, when executed and delivered by Borrowers,
constitute the legal, valid and binding obligation of Borrowers, enforceable
against Borrowers in accordance with its terms, EXCEPT as enforcement may be
limited by Debtor Relief Laws or equitable principles relating to the
granting of specific performance and other equitable remedies as a matter of
judicial discretion.
4.12 NO DEFAULT. No event has occurred and is continuing that is a
Default or Event of Default.
4.13 ERISA.
(a) With respect to each Pension Plan:
(i) such Pension Plan complies in all material respects
with ERISA and any other applicable Laws to the extent that
noncompliance could reasonably be expected to have a Material
Adverse Effect;
(ii) such Pension Plan has not incurred any
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"accumulated funding deficiency" (as defined in Section 302 of ERISA)
that could reasonably be expected to have a Material Adverse Effect;
(iii) no "reportable event" (as defined in Section 4043 of
ERISA, but EXCLUDING such events as to which the PBGC has by
regulation waived the requirement therein contained that it be
notified within thirty days of the occurrence of such event) has
occurred that could reasonably be expected to have a Material
Adverse Effect; and
(iv) none of Parent nor any of its Subsidiaries has
engaged in any non-exempt "prohibited transaction" (as defined in
Section 4975 of the Code) that could reasonably be expected to have
a Material Adverse Effect.
(b) None of Parent nor any of its Subsidiaries has incurred or
expects to incur any withdrawal liability to any Multiemployer Plan that
could reasonably be expected to have a Material Adverse Effect.
4.14 REGULATIONS G AND U; INVESTMENT COMPANY ACT. No part of the
proceeds of any Loan hereunder will be used to purchase or carry, or to
extend credit to others for the purpose of purchasing or carrying, any Margin
Stock in violation of Regulations G and U. Neither Parent nor any of its
Subsidiaries is or is required to be registered as an "investment company"
under the Investment Company Act of 1940.
4.15 DISCLOSURE. No written statement made by a Senior Officer to
the Managing Agent or any Bank in connection with this Agreement, or in
connection with any Loan, as of the date thereof contained any untrue
statement of a material fact or omitted a material fact necessary to make the
statement made not misleading in light of all the circumstances existing at
the date the statement was made.
4.16 TAX LIABILITY. Parent and its Subsidiaries have filed all tax
returns which are required to be filed, and have paid, or made provision for
the payment of, all taxes with respect to the periods, Property or
transactions covered by said returns, or pursuant to any assessment received
by Parent or any of its Subsidiaries, EXCEPT (a) such taxes, if any, as are
being contested in good faith by appropriate proceedings and as to which
adequate reserves have been established and maintained and (b) immaterial
taxes so long as no material Property of Parent or any of its Subsidiaries
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is at impending risk of being seized, levied upon or forfeited.
4.17 HAZARDOUS MATERIALS. Except as described in SCHEDULE 4.17, as
of the Closing Date (a) none of Borrowers at any time has disposed of,
discharged, released or threatened the release of any Hazardous Materials on,
from or under the Real Property in violation of any Hazardous Materials Law
that would individually or in the aggregate constitute a Material Adverse
Effect, (b) to the best knowledge of Borrowers, no condition exists that
violates any Hazardous Material Law affecting any Real Property except for
such violations that would not individually or in the aggregate constitute a
Material Adverse Effect, (c) no Real Property or any portion thereof is or
has been utilized by Borrowers as a site for the manufacture of any Hazardous
Materials and (d) to the extent that any Hazardous Materials are used,
generated or stored by Borrowers on any Real Property, or transported to or
from such Real Property by Borrowers, such use, generation, storage and
transportation are in compliance with all Hazardous Materials Laws except for
such non-compliance that would not constitute a Material Adverse Effect or be
materially adverse to the interests of the Banks.
4.18 INITIAL POOL PROPERTIES. The Initial Pool Properties
described on SCHEDULE 4.18 are, as of the Closing Date, Qualified
Unencumbered Asset Pool Properties and comprise the initial Unencumbered
Asset Pool.
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Article 5
AFFIRMATIVE COVENANTS
(OTHER THAN INFORMATION AND
REPORTING REQUIREMENTS)
So long as any Advance remains unpaid, or any other Obligation
remains unpaid, or any portion of the Commitments remains in force, Borrowers
shall, unless the Managing Agent (with the written approval of the Requisite
Banks) otherwise consents:
5.1 PAYMENT OF TAXES AND OTHER POTENTIAL LIENS. Pay and discharge
promptly all taxes, assessments and governmental charges or levies imposed
upon any of them, upon their respective Property or any part thereof and upon
their respective income or profits or any part thereof, EXCEPT that Borrowers
shall not be required to pay or cause to be paid (a) any tax, assessment,
charge or levy that is not yet past due, or is being contested in good faith
by appropriate proceedings so long as the relevant entity has established and
maintains adequate reserves for the payment of the same or (b) any immaterial
tax so long as no material Property of Borrowers is at impending risk of
being seized, levied upon or forfeited.
5.2 PRESERVATION OF EXISTENCE. Preserve and maintain their
respective existences in the jurisdiction of their formation and all material
authorizations, rights, franchises, privileges, consents, approvals, orders,
licenses, permits, or registrations from any Governmental Agency that are
necessary for the transaction of their respective business and qualify and
remain qualified to transact business in each jurisdiction in which such
qualification is necessary in view of their respective business or the
ownership or leasing of their respective Properties EXCEPT (a) as otherwise
permitted by this Agreement and (b) where the failure to so qualify or remain
qualified would not constitute a Material Adverse Effect.
5.3 MAINTENANCE OF PROPERTIES. Maintain, preserve and protect all
of their respective Properties in good order and condition, subject to wear
and tear in the ordinary course of business, and not permit any waste of
their respective Properties, EXCEPT that the failure to maintain, preserve
and protect a particular item of Property that is at the end of its useful
life or that is not of significant value, either intrinsically or to the
operations of Borrowers, shall not constitute a violation of this covenant.
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5.4 MAINTENANCE OF INSURANCE. Maintain liability, casualty and
other insurance (subject to customary deductibles and retentions) with
responsible insurance companies in such amounts and against such risks as is
carried by responsible companies engaged in similar businesses and owning
similar assets in the general areas in which Borrowers operate.
5.5 COMPLIANCE WITH LAWS. Comply with all Requirements of Law
noncompliance with which constitutes a Material Adverse Effect, EXCEPT that
Borrowers need not comply with a Requirement of Law then being contested by
any of them in good faith by appropriate proceedings.
5.6 INSPECTION RIGHTS. Upon reasonable notice, at any time during
regular business hours and as often as reasonably requested (but not so as to
materially interfere with the business of Parent or any of its Subsidiaries)
permit the Managing Agent or any Bank, or any authorized employee, agent or
representative thereof, to examine, audit and make copies and abstracts from
the records and books of account of, and to visit and inspect the Properties
(subject to the rights of any tenants) of, Parent and its Subsidiaries and to
discuss the affairs, finances and accounts of Parent and its Subsidiaries
with any of their officers, key employees or accountants.
5.7 KEEPING OF RECORDS AND BOOKS OF ACCOUNT. Keep adequate records
and books of account reflecting all financial transactions in conformity with
Generally Accepted Accounting Principles, consistently applied, and in
material conformity with all applicable requirements of any Governmental
Agency having regulatory jurisdiction over Borrowers.
5.8 COMPLIANCE WITH AGREEMENTS. Promptly and fully comply with all
Contractual Obligations to which any one or more of them is a party, EXCEPT
for any such Contractual Obligations (a) the performance of which would cause
a Default or (b) then being contested by any of them in good faith by
appropriate proceedings or if the failure to comply with such agreements,
indentures, leases or instruments does not constitute a Material Adverse
Effect.
5.9 USE OF PROCEEDS. Use the proceeds of all Loans for working
capital and general corporate purposes of Borrowers, INCLUDING the
acquisition and/or improvement of Revenue-Producing Properties and
Undeveloped Properties.
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5.10 HAZARDOUS MATERIALS LAWS. Keep and maintain all Real Property
and each portion thereof in compliance in all material respects with all
applicable Hazardous Materials Laws and promptly notify the Managing Agent in
writing (attaching a copy of any pertinent written material) of (a) any and
all material enforcement, cleanup, removal or other governmental or
regulatory actions instituted, completed or threatened in writing by a
Governmental Agency pursuant to any applicable Hazardous Materials Laws, (b)
any and all material claims made or threatened in writing by any Person
against Borrowers relating to damage, contribution, cost recovery,
compensation, loss or injury resulting from any Hazardous Materials and (c)
discovery by any Senior Officer of any of Borrowers of any material
occurrence or condition on any real Property adjoining or in the vicinity of
such Real Property that could reasonably be expected to cause such Real
Property or any part thereof to be subject to any restrictions on the
ownership, occupancy, transferability or use of such Real Property under any
applicable Hazardous Materials Laws.
5.11 UNENCUMBERED ASSET POOL. Cause each Revenue-Producing Property
in the Unencumbered Asset Pool to remain a Qualified Unencumbered Asset Pool
Property so long as it is in the Unencumbered Asset Pool; PROVIDED that
nothing herein shall preclude the removal of any Revenue-Producing Property
from the Unencumbered Asset Pool pursuant to Section 2.11.
5.12 REIT STATUS. Maintain the status of Parent as a "real estate
investment trust" under Section 856 of the Code and comply with the dividend
and other requirements applicable under Section 857(a) of the Code.
5.13 ADDITIONAL BORROWERS. Cause each Wholly-Owned Subsidiary of
Parent which is not then a Borrower and which holds a Revenue-Producing
Property that is or will become part of the Unencumbered Asset Pool to
execute and deliver the Joinder Agreement concurrently with the addition of
such Revenue-Producing Property to the Unencumbered Asset Pool.
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Article 6
NEGATIVE COVENANTS
So long as any Advance remains unpaid, or any other Obligation
remains unpaid, or any portion of the Commitments remains in force, Borrowers
shall not, unless the Managing Agent (with the written approval of the
Requisite Banks or, if required by Section 11.2, of all of the Banks)
otherwise consents:
6.1 MERGERS. Merge or consolidate with or into any Person, EXCEPT
a merger or consolidation where Parent is the surviving corporation that does
not result in a Change in Control.
6.2 ERISA. (a) At any time, permit any Pension Plan to: (i)
engage in any non-exempt "prohibited transaction" (as defined in Section 4975
of the Code) which could reasonably be expected to result in a Material
Adverse Effect, (ii) fail to comply with ERISA which could reasonably be
expected to result in a Material Adverse Effect, (iii) incur any material
"accumulated funding deficiency" (as defined in Section 302 of ERISA) which
could reasonably be expected to result in a Material Adverse Effect or (iv)
terminate in any manner which could reasonably be expected to result in a
Material Adverse Effect, or (b) withdraw, completely or partially, from any
Multiemployer Plan if to do so could reasonably be expected to result in a
Material Adverse Effect.
6.3 CHANGE IN NATURE OF BUSINESS. Make any material change in the
nature of the business of Borrowers.
6.4 TRANSACTIONS WITH AFFILIATES. Enter into any transaction of
any kind with any Affiliate of Borrowers OTHER THAN (a) salary, bonus,
employee stock option, relocation assistance and other compensation
arrangements with directors or officers in the ordinary course of business,
(b) transactions that are fully disclosed to the board of directors of Parent
and expressly authorized by a resolution of the board of directors of Parent
which is approved by a majority of the directors not having an interest in
the transaction, (c) transactions expressly permitted by this Agreement, (d)
transactions between one Borrower and another Borrower and (e) transactions
on overall terms at least as favorable to Borrowers as would be the case in
an arm's-length transaction between unrelated parties of equal bargaining
power.
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6.5 LEVERAGE RATIO. Permit the Leverage Ratio, as of the last day
of any Fiscal Quarter, to be greater than .50 to 1.00.
6.6 INTEREST COVERAGE. Permit Interest Coverage, as of the last
day of any Fiscal Quarter, to be less than 2.50 to 1.00.
6.7 FIXED CHARGE COVERAGE. Permit Fixed Charge Coverage, as of the
last day of any Fiscal Quarter, to be less than 2.00 to 1.00.
6.8 DISTRIBUTIONS. Make any Distribution (a) with respect to any
Fiscal Quarter or Fiscal Year in excess of an amount equal to 95% of Funds
From Operations of Parent and its Subsidiaries for that Fiscal Quarter or
Fiscal Year or (b) during the continuance of an Event of Default, in excess
of the minimum amount necessary to comply with Section 857(a) of the Code.
6.9 MARKET NET WORTH. Permit Market Net Worth, as of the last day
of any Fiscal Quarter, to be less than $135,000,000.
6.10 UNDEVELOPED PROPERTY. Permit the aggregate amount expended by
Parent or any of its Subsidiaries for the acquisition and/or improvement
and/or leasing of Undeveloped Property (INCLUDING the acquisition cost of
land acquired after the Closing Date, all entitlement, zoning, design,
construction, leasing and all other "hard" and "soft" costs related to
Undeveloped Property, but EXCLUDING amounts expended for Undeveloped
Properties that have subsequently become Stabilized Revenue-Producing
Properties) to exceed an amount equal to 20% of Revenue-Producing Property
Value as of the most recently-ended Fiscal Quarter.
6.11 UNENCUMBERED REVENUE-PRODUCING PROPERTY. Permit the
Revenue-Producing Property Value of all Revenue-Producing Property that is
Unencumbered to be less than an amount equal to 50% of the Revenue-Producing
Property Value of all Revenue-Producing Property as of the most
recently-ended Fiscal Quarter.
6.12 SECURED RECOURSE DEBT. Permit Secured Recourse Debt to exceed
an amount equal to 15% of Revenue-Producing Property Value as of the most
recently-ended Fiscal Quarter.
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6.13 OTHER UNSECURED DEBT. Permit Other Unsecured Debt to exceed an
amount equal to 10% of Unencumbered Asset Pool Value as of the most
recently-ended Fiscal Quarter prior to the incurrence thereof.
6.14 INVESTMENTS IN CERTAIN PERSONS. Make any Investment in any
Person that is not a Controlled Entity (OTHER THAN an Investment by a
Subsidiary of Parent in Parent) if, giving effect thereto, the aggregate of
all Investments made by Parent and its Subsidiaries in all such Persons would
exceed an amount equal to 15% of Tangible Net Worth as of the most
recently-ended Fiscal Quarter.
6.15 NEGATIVE PLEDGES. Grant to any Person a Negative Pledge on any
Property of Parent and its Subsidiaries that, as of the LATER OF the Closing
Date or the date of its acquisition, is not subject to a Lien (OTHER THAN
Permitted Encumbrances).
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Article 7
INFORMATION AND REPORTING REQUIREMENTS
7.1 FINANCIAL AND BUSINESS INFORMATION. So long as any Advance
remains unpaid, or any other Obligation remains unpaid, or any portion of the
Commitments remains in force, Borrowers shall, unless the Managing Agent
(with the written approval of the Requisite Banks) otherwise consents, at
Borrowers' sole expense, deliver to the Managing Agent for distribution by it
to the Banks, a sufficient number of copies for all of the Banks of the
following:
(a) As soon as practicable, and in any event within 60 days
after the end of each Fiscal Quarter (OTHER THAN the fourth Fiscal
Quarter in any Fiscal Year), the consolidated balance sheet of Parent
and its Subsidiaries as at the end of such Fiscal Quarter and the
consolidated statements of operations and cash flows for such Fiscal
Quarter, and the portion of the Fiscal Year ended with such Fiscal
Quarter, all in reasonable detail. Such financial statements shall be
certified by a Senior Officer of Parent as fairly presenting the
financial condition, results of operations and cash flows of Parent and
its Subsidiaries in accordance with Generally Accepted Accounting
Principles (other than footnote disclosures), consistently applied, as
at such date and for such periods, subject only to normal year-end
accruals and audit adjustments;
(b) As soon as practicable, and in any event within 60 days
after the end of each Fiscal Quarter, a Pricing Certificate setting
forth a calculation of the Leverage Ratio as of the last day of such
Fiscal Quarter, and providing reasonable detail as to the calculation
thereof, which calculations in the case of the fourth Fiscal Quarter in
any Fiscal Year shall be based on the preliminary unaudited financial
statements of Parent and its Subsidiaries for such Fiscal Quarter, and
as soon as practicable thereafter, in the event of any material variance
in the actual calculation of the Leverage Ratio from such preliminary
calculation, a revised Pricing Certificate setting forth the actual
calculation thereof;
(c) As soon as practicable, and in any event within 60 days
after the end of each Fiscal Quarter, statements of operating income for
such Fiscal Quarter and Fiscal Year to date for each of the
Revenue-Producing
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Properties in the Unencumbered Asset Pool, each in reasonable detail;
(d) As soon as practicable, and in any event within 60 days
after the end of each Fiscal Quarter, supplemental disclosure
information setting forth the effect on Net Income reflected in the
financial statements for such Fiscal Quarter and Fiscal Year to date of
any difference between the rents payable by tenants during the periods
covered by such financial statements and the "straight line" rents
payable over the terms of their respective leases, in reasonable detail;
(e) As soon as practicable, and in any event within 120 days
after the end of each Fiscal Year, the consolidated balance sheet of
Parent and its Subsidiaries as at the end of such Fiscal Year and the
consolidated statements of operations, stockholders' equity and cash
flows, in each case of Parent and its Subsidiaries for such Fiscal Year,
all in reasonable detail. Such financial statements shall be prepared
in accordance with Generally Accepted Accounting Principles,
consistently applied, and shall be accompanied by a report of Ernst &
Young LLP or other independent public accountants of recognized standing
selected by Parent and reasonably satisfactory to the Requisite Banks,
which report shall be prepared in accordance with generally accepted
auditing standards as at such date, and shall not be subject to any
qualifications or exceptions as to the scope of the audit nor to any
other qualification or exception determined by the Requisite Banks in
their good faith business judgment to be adverse to the interests of the
Banks;
(f) As soon as practicable, and in any event before the
commencement of each Fiscal Year, a budget and projection by Fiscal
Quarter for that Fiscal Year and by Fiscal Year for the next two
succeeding Fiscal Years, INCLUDING for the first such Fiscal Year,
projected consolidated balance sheets, statements of operations and
statements of cash flow and, for the second and third such Fiscal Years,
projected consolidated condensed balance sheets and statements of
operations and cash flows, of Parent and its Subsidiaries, all in
reasonable detail;
(g) Promptly after request by the Managing Agent or any Bank,
copies of any detailed audit reports, management letters or
recommendations submitted to the board of directors (or the audit
committee of the board of
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directors) of Parent by independent accountants in connection with the
accounts or books of Parent or any of its Subsidiaries, or any audit of
any of them;
(h) Promptly after the same are available, and in any event
within five (5) Banking Days after filing with the Securities and
Exchange Commission, copies of each annual report, proxy or financial
statement or other report or communication sent to the stockholders of
Parent, and copies of all annual, regular, periodic and special reports
and registration statements which Parent may file or be required to file
with the Securities and Exchange Commission under Section 13 or 15(d) of
the Securities Exchange Act of 1934, as amended, and not otherwise
required to be delivered to the Banks pursuant to other provisions of
this Section 8.1;
(i) Promptly after request by the Managing Agent or any Bank,
copies of any other report or other document that was filed by Borrowers
with any Governmental Agency;
(j) Promptly upon a Senior Officer becoming aware, and in any
event within five (5) Banking Days after becoming aware, of the
occurrence of any (i) "reportable event" (as such term is defined in
Section 4043 of ERISA, but EXCLUDING such events as to which the PBGC
has by regulation waived the requirement therein contained that it be
notified within thirty days of the occurrence of such event) or (ii)
non-exempt "prohibited transaction" (as such term is defined in Section
406 of ERISA or Section 4975 of the Code) involving any Pension Plan or
any trust created thereunder, telephonic notice specifying the nature
thereof, and, no more than two (2) Banking Days after such telephonic
notice, written notice again specifying the nature thereof and
specifying what action Borrowers are taking or propose to take with
respect thereto, and, when known, any action taken by the Internal
Revenue Service with respect thereto;
(k) As soon as practicable, and in any event within two (2)
Banking Days after a Senior Officer becomes aware of the existence of
any condition or event which constitutes a Default or Event of Default,
telephonic notice specifying the nature and period of existence thereof,
and, no more than two (2) Banking Days after such telephonic notice,
written notice again specifying the nature and period of existence
thereof and specifying what
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action Borrowers are taking or propose to take with respect thereto;
(l) Promptly upon a Senior Officer becoming aware that (i) any
Person has commenced a legal proceeding with respect to a claim against
Borrowers that is $1,000,000 or more in excess of the amount thereof
that is fully covered by insurance, (ii) any creditor under a credit
agreement involving Indebtedness of $1,000,000 or more or any lessor
under a lease involving aggregate rent of $1,000,000 or more has
asserted a default thereunder on the part of Borrowers or, (iii) any
Person has commenced a legal proceeding with respect to a claim against
Borrowers under a contract that is not a credit agreement or material
lease in excess of $1,000,000 or which otherwise may reasonably be
expected to result in a Material Adverse Effect, a written notice
describing the pertinent facts relating thereto and what action
Borrowers are taking or propose to take with respect thereto;
(m) Promptly upon a Senior Officer becoming aware of a change
in the credit rating given by a Rating Agency to Parent's long-term
senior unsecured debt, written notice of such change; and
(n) Such other data and information as from time to time may
be reasonably requested by the Managing Agent, any Bank (through the
Managing Agent) or the Requisite Banks.
7.2 COMPLIANCE CERTIFICATES. So long as any Advance remains
unpaid, or any other Obligation remains unpaid or unperformed, or any portion
of the Commitments remains outstanding, Borrowers shall, at Borrowers' sole
expense, deliver to the Managing Agent for distribution by it to the Banks
concurrently with the financial statements required pursuant to Sections
7.1(a) and 7.1(e), Compliance Certificates signed by a Senior Officer.
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Article 8
CONDITIONS
8.1 INITIAL ADVANCES. The obligation of each Bank to make the
initial Advance to be made by it is subject to the following conditions
precedent, each of which shall be satisfied prior to the making of the
initial Advances (unless all of the Banks, in their sole and absolute
discretion, shall agree otherwise):
(a) The Managing Agent shall have received all of the
following, each of which shall be originals unless otherwise specified,
each properly executed by a Responsible Official of each party thereto,
each dated as of the Closing Date and each in form and substance
satisfactory to the Managing Agent and its legal counsel (unless
otherwise specified or, in the case of the date of any of the following,
unless the Managing Agent otherwise agrees or directs):
(1) at least one (1) executed counterpart of this
Agreement, together with arrangements satisfactory to the Managing
Agent for additional executed counterparts, sufficient in number for
distribution to the Banks and Borrowers;
(2) Line A Notes executed by Borrowers in favor of each
Bank, each in a principal amount equal to that Bank's Pro Rata Share
of the Line A Commitment;
(3) Line B Notes executed by Borrowers in favor of each
Bank, each in a principal amount equal to that Bank's Pro Rata Share
of the Line B Commitment;
(4) Competitive Advance Notes executed by Borrowers in
favor of each Bank, each in the principal amount of $50,000,000;
(5) with respect to each of Borrowers, such documentation
as the Managing Agent may require to establish the due organization,
valid existence and good standing of each of Borrowers, its
qualification to engage in business in each material jurisdiction in
which
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it is engaged in business or required to be so qualified, its
authority to execute, deliver and perform the Loan Documents to
which it is a Party, the identity, authority and capacity of each
Responsible Official thereof authorized to act on its behalf,
INCLUDING certified copies of articles of incorporation and
amendments thereto, bylaws and amendments thereto, certificates of
good standing and/or qualification to engage in business, tax
clearance certificates, certificates of corporate resolutions,
incumbency certificates, Certificates of Responsible Officials, and
the like;
(6) the Opinions of Counsel;
(7) a Certificate of a Senior Officer of Parent stating
that Parent has received Cash of not less than $120,000,000 from the
issuance and sale of Common Stock subsequent to March 31, 1997;
(8) a Certificate of a Senior Officer of each of the
Borrowers certifying that the conditions specified in Sections
8.1(f) and 8.1(g) have been satisfied; and
(9) such other assurances, certificates, documents,
consents or opinions as the Managing Agent or the Requisite Banks
reasonably may require.
(b) The arrangement fee payable pursuant to Section 3.2 shall
have been paid.
(c) Any agency fees payable on the Closing Date pursuant to
Section 3.5 shall have been paid.
(d) All Indebtedness outstanding under the Prior Credit
Agreement shall have been (or shall concurrently be) paid and the same
shall have been (or shall concurrently be) terminated.
(e) The reasonable costs and expenses of the Managing Agent in
connection with the preparation of the Loan Documents payable pursuant
to Section 11.3, and invoiced to Borrowers prior to the Closing Date,
shall have
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been paid.
(f) The representations and warranties of Borrowers contained
in ARTICLE 4 shall be true and correct in all material respects.
(g) Borrowers and any other Parties shall be in compliance
with all the terms and provisions of the Loan Documents, and giving
effect to the initial Advance no Default or Event of Default shall have
occurred and be continuing.
(h) All legal matters relating to the Loan Documents shall be
satisfactory to Sheppard, Mullin, Richter & Hampton LLP, special counsel
to the Managing Agent.
(i) The Closing Date shall have occurred on or before July 31,
1997.
8.2 ANY ADVANCE. The obligation of each Bank to make any Advance
is subject to the following conditions precedent (unless the Requisite Banks,
in their sole and absolute discretion, shall agree otherwise):
(a) EXCEPT (i) for representations and warranties which
expressly speak as of a particular date or are no longer true and
correct as a result of a change which is permitted by this Agreement or
(ii) as disclosed by Borrowers and approved in writing by the Requisite
Banks, the representations and warranties contained in ARTICLE 4 (OTHER
THAN Sections 4.4, 4.6 (first sentence), 4.10 and 4.18) shall be true
and correct in all material respects on and as of the date of the
Advance as though made on that date;
(b) other than matters described in SCHEDULE 4.10 or not
required as of the Closing Date to be therein described, there shall not
be then pending or threatened any action, suit, proceeding or
investigation against or affecting Parent or any of its Subsidiaries or
any Property of any of them before any Governmental Agency that
constitutes a Material Adverse Effect;
(c) the Managing Agent shall have timely received a Request
for Loan in compliance with ARTICLE 2 (or telephonic or other request for
Loan
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referred to in the second sentence of Section 2.1(c), if applicable), in
compliance with ARTICLE 2; and
(d) the Managing Agent shall have received, in form and
substance satisfactory to the Managing Agent, such other assurances,
certificates, documents or consents related to the foregoing as the
Managing Agent or Requisite Banks reasonably may require.
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Article 9
EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT
9.1 EVENTS OF DEFAULT. The existence or occurrence of any one or
more of the following events, whatever the reason therefor and under any
circumstances whatsoever, shall constitute an Event of Default:
(a) Borrowers fail to pay any principal on any of the
Notes, or any portion thereof, on the date when due; or
(b) Borrowers fail to pay any interest on any of the Notes,
or any fees under Sections 3.4 or 3.5, or any portion thereof, within
five (5) Banking Days after the date when due; or fail to pay any other
fee or amount payable to the Banks under any Loan Document, or any
portion thereof, within five (5) Banking Days after demand therefor; or
(c) Borrowers fail to comply with any of the covenants
contained in ARTICLE 6; or
(d) Borrowers fail to comply with Section 7.1(k) in any
respect that is materially adverse to the interests of the Banks; or
(e) Any Borrower or any other Party fails to perform or
observe any other covenant or agreement (not specified in clause (a),
(b), (c) or (d) above) contained in any Loan Document on its part to be
performed or observed within thirty (30) Banking Days after the giving
of notice by the Managing Agent on behalf of the Requisite Banks of
such Default or, if such Default is not reasonably susceptible of cure
within such period, within such longer period as is reasonably
necessary to effect a cure so long as such Borrower or such Party
continues to diligently pursue cure of such Default but not in any
event in excess of sixty (60) Banking Days; or
(f) Any representation or warranty of Borrowers made in any
Loan Document, or in any certificate or other writing delivered by
Borrowers or such Guarantor pursuant to any Loan Document, proves to
have been incorrect when made or reaffirmed in any respect that is
materially adverse to the
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interests of the Banks; or
(g) Borrowers (i) fail to pay the principal, or any
principal installment, of any present or future Indebtedness (OTHER
THAN Non-Recourse Debt) of $5,000,000 or more, or any guaranty of
present or future Indebtedness (OTHER THAN Non-Recourse Debt) of
$5,000,000 or more, on its part to be paid, when due (or within any
stated grace period), whether at the stated maturity, upon
acceleration, by reason of required prepayment or otherwise or (ii)
fails to perform or observe any other term, covenant or agreement on
its part to be performed or observed, or suffers any event of default
to occur, in connection with any present or future Indebtedness (OTHER
THAN Non-Recourse Debt) of $5,000,000 or more, or of any guaranty of
present or future Indebtedness (OTHER THAN Non-Recourse Debt) of
$5,000,000 or more, if as a result of such failure or sufferance any
holder or holders thereof (or an agent or trustee on its or their
behalf) has the right to declare such Indebtedness due before the date
on which it otherwise would become due or the right to require
Borrowers to redeem or purchase, or offer to redeem or purchase, all or
any portion of such Indebtedness (PROVIDED, that for the purpose of
this clause (g), the principal amount of Indebtedness consisting of a
Swap Agreement shall be the amount which is then payable by the
counterparty to close out the Swap Agreement); or
(h) Any Loan Document, at any time after its execution and
delivery and for any reason OTHER THAN the agreement or action (or
omission to act) of the Managing Agent or the Banks or satisfaction in
full of all the Obligations ceases to be in full force and effect or is
declared by a court of competent jurisdiction to be null and void,
invalid or unenforceable in any respect which is materially adverse to
the interests of the Banks; or any Party thereto denies in writing that
it has any or further liability or obligation under any Loan Document,
or purports to revoke, terminate or rescind same; or
(i) A final judgment against any of Borrowers is entered
for the payment of money in excess of $1,000,000 (not covered by
insurance or for which an insurer has reserved its rights) and, absent
procurement of a stay of execution, such judgment remains unsatisfied
for thirty (30) calendar days after the date of entry of judgment, or
in any event later than five (5) days prior to the date of any proposed
sale thereunder; or any writ or warrant of attachment or execution or
similar process is issued or levied against all or any material part of
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the Property of any such Person and is not released, vacated or fully
bonded within thirty (30) calendar days after its issue or levy; or
(j) Any of Borrowers institutes or consents to the
institution of any proceeding under a Debtor Relief Law relating to it
or to all or any material part of its Property, or is unable or admits
in writing its inability to pay its debts as they mature, or makes an
assignment for the benefit of creditors; or applies for or consents to
the appointment of any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer for it or for all or any
material part of its Property; or any receiver, trustee, custodian,
conservator, liquidator, rehabilitator or similar officer is appointed
without the application or consent of that Person and the appointment
continues undischarged or unstayed for sixty (60) calendar days; or any
proceeding under a Debtor Relief Law relating to any such Person or to
all or any part of its Property is instituted without the consent of
that Person and continues undismissed or unstayed for sixty (60)
calendar days; or
(k) The occurrence of an Event of Default (as such term is
or may hereafter be specifically defined in any other Loan Document)
under any other Loan Document; or
(l) Any Pension Plan maintained by Borrowers is determined
to have a material "accumulated funding deficiency" as that term is
defined in Section 302 of ERISA in excess of an amount equal to 5% of
the combined total assets of Borrowers as of the most-recently ended
Fiscal Quarter.
9.2 REMEDIES UPON EVENT OF DEFAULT. Without limiting any other
rights or remedies of the Managing Agent or the Banks provided for elsewhere
in this Agreement, or the other Loan Documents, or by applicable Law, or in
equity, or otherwise:
(a) Upon the occurrence, and during the continuance, of any
Event of Default OTHER THAN an Event of Default described in Section
9.1(j):
(1) the Commitments to make Advances and all other
obligations of the Managing Agent or the Banks and all rights of
Borrowers and any other Parties under the Loan Documents shall
be
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suspended without notice to or demand upon Borrowers, which are
expressly waived by Borrowers, EXCEPT that all of the Banks or
the Requisite Banks (as the case may be, in accordance with
Section 11.2) may waive an Event of Default or, without waiving,
determine, upon terms and conditions satisfactory to the Banks
or Requisite Banks, as the case may be, to reinstate the
Commitments and such other obligations and rights and make
further Advances, which waiver or determination shall apply
equally to, and shall be binding upon, all the Banks; and
(2) the Requisite Banks may request the Managing Agent
to, and the Managing Agent thereupon shall, terminate the
Commitments and/or declare all or any part of the unpaid
principal of all Notes, all interest accrued and unpaid thereon
and all other amounts payable under the Loan Documents to be
forthwith due and payable, whereupon the same shall become and
be forthwith due and payable, without protest, presentment,
notice of dishonor, demand or further notice of any kind, all of
which are expressly waived by Borrowers.
(b) Upon the occurrence of any Event of Default described
in Section 9.1(j):
(1) the Commitments to make Advances and all other
obligations of the Managing Agent or the Banks and all rights of
Borrowers and any other Parties under the Loan Documents shall
terminate without notice to or demand upon Borrowers, which are
expressly waived by Borrowers, EXCEPT that all of the Banks may
waive the Event of Default or, without waiving, determine, upon
terms and conditions satisfactory to all the Banks, to reinstate
the Commitments and such other obligations and rights and make
further Advances, which determination shall apply equally to,
and shall be binding upon, all the Banks; and
(2) the unpaid principal of all Notes, all interest
accrued and unpaid thereon and all other amounts payable under
the Loan Documents shall be forthwith due and payable, without
protest, presentment, notice of dishonor, demand or further
notice of any kind, all of which are expressly waived by
Borrowers.
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(c) Upon the occurrence of any Event of Default, the Banks
and the Managing Agent, or any of them, without notice to (EXCEPT as
expressly provided for in any Loan Document) or demand upon Borrowers,
which are expressly waived by Borrowers (EXCEPT as to notices expressly
provided for in any Loan Document), may proceed (but only with the
consent of the Requisite Banks) to protect, exercise and enforce their
rights and remedies under the Loan Documents against Borrowers and any
other Party and such other rights and remedies as are provided by Law
or equity.
(d) The order and manner in which the Banks' rights and
remedies are to be exercised shall be determined by the Requisite Banks
in their sole discretion, and all payments received by the Managing
Agent and the Banks, or any of them, shall be applied first to the
costs and expenses (including reasonable attorneys' fees and
disbursements and the reasonably allocated costs of attorneys employed
by the Managing Agent or by any Bank) of the Managing Agent and of the
Banks, and thereafter paid pro rata to the Banks in the same
proportions that the aggregate Obligations owed to each Bank under the
Loan Documents bear to the aggregate Obligations owed under the Loan
Documents to all the Banks, without priority or preference among the
Banks. Regardless of how each Bank may treat payments for the purpose
of its own accounting, for the purpose of computing Borrowers'
Obligations hereunder and under the Notes, payments shall be applied
FIRST, to the costs and expenses of the Managing Agent and the Banks,
as set forth above, SECOND, to the payment of accrued and unpaid
interest due under any Loan Documents to and including the date of such
application (ratably, and without duplication, according to the accrued
and unpaid interest due under each of the Loan Documents), and THIRD,
to the payment of all other amounts (including principal and fees) then
owing to the Managing Agent or the Banks under the Loan Documents. No
application of payments will cure any Event of Default, or prevent
acceleration, or continued acceleration, of amounts payable under the
Loan Documents, or prevent the exercise, or continued exercise, of
rights or remedies of the Banks hereunder or thereunder or at Law or in
equity.
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Article 10
THE MANAGING AGENT
10.1 APPOINTMENT AND AUTHORIZATION. Subject to Section 10.8, each
Bank hereby irrevocably appoints and authorizes the Managing Agent to take
such action as agent on its behalf and to exercise such powers under the Loan
Documents as are delegated to the Managing Agent by the terms thereof or are
reasonably incidental, as determined by the Managing Agent, thereto. This
appointment and authorization is intended solely for the purpose of
facilitating the servicing of the Loans and does not constitute appointment
of the Managing Agent as trustee for any Bank or as representative of any
Bank for any other purpose and, EXCEPT as specifically set forth in the Loan
Documents to the contrary, the Managing Agent shall take such action and
exercise such powers only in an administrative and ministerial capacity.
10.2 MANAGING AGENT AND AFFILIATES. Bank of America National Trust
and Savings Association (and each successor Managing Agent) has the same
rights and powers under the Loan Documents as any other Bank and may exercise
the same as though it were not the Managing Agent, and the term "Bank" or
"Banks" includes Bank of America National Trust and Savings Association in
its individual capacity. Bank of America National Trust and Savings
Association (and each successor Managing Agent) and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of banking,
trust or other business with Borrowers, any Subsidiary thereof, or any
Affiliate of Borrowers or any Subsidiary thereof, as if it were not the
Managing Agent and without any duty to account therefor to the Banks. Bank
of America National Trust and Savings Association (and each successor
Managing Agent) need not account to any other Bank for any monies received by
it for reimbursement of its costs and expenses as Managing Agent hereunder,
or for any monies received by it in its capacity as a Bank hereunder. The
Managing Agent shall not be deemed to hold a fiduciary relationship with any
Bank and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or otherwise
exist against the Managing Agent.
10.3 PROPORTIONATE INTEREST IN ANY COLLATERAL. The Managing Agent,
on behalf of all the Banks, shall hold in accordance with the Loan Documents
all items of any collateral or interests therein received or held by the
Managing Agent. Subject to the Managing Agent's and the Banks' rights to
reimbursement for their costs and
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expenses hereunder (INCLUDING reasonable attorneys' fees and disbursements
and other professional services and the reasonably allocated costs of
attorneys employed by the Managing Agent or a Bank) and subject to the
application of payments in accordance with Section 9.2(d), each Bank shall
have an interest in the Banks' interest in such collateral or interests
therein in the same proportions that the aggregate Obligations owed such Bank
under the Loan Documents bear to the aggregate Obligations owed under the
Loan Documents to all the Banks, without priority or preference among the
Banks.
10.4 BANKS' CREDIT DECISIONS. Each Bank agrees that it has,
independently and without reliance upon the Managing Agent, any other Bank or
the directors, officers, agents, employees or attorneys of the Managing Agent
or of any other Bank, and instead in reliance upon information supplied to it
by or on behalf of Borrowers and upon such other information as it has deemed
appropriate, made its own independent credit analysis and decision to enter
into this Agreement. Each Bank also agrees that it shall, independently and
without reliance upon the Managing Agent, any other Bank or the directors,
officers, agents, employees or attorneys of the Managing Agent or of any
other Bank, continue to make its own independent credit analyses and
decisions in acting or not acting under the Loan Documents.
10.5 ACTION BY MANAGING AGENT.
(a) Absent actual knowledge of the Managing Agent of the
existence of a Default, the Managing Agent may assume that no Default
has occurred and is continuing, unless the Managing Agent (or the Bank
that is then the Managing Agent) has received notice from Borrowers
stating the nature of the Default or has received notice from a Bank
stating the nature of the Default and that such Bank considers the
Default to have occurred and to be continuing.
(b) The Managing Agent has only those obligations under the
Loan Documents as are expressly set forth therein.
(c) EXCEPT for any obligation expressly set forth in the
Loan Documents and as long as the Managing Agent may assume that no
Event of Default has occurred and is continuing, the Managing Agent
may, but shall not be required to, exercise its discretion to act or
not act, EXCEPT that the Managing Agent shall be required to act or not
act upon the instructions of the Requisite
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Banks (or of all the Banks, to the extent required by Section 11.2) and
those instructions shall be binding upon the Managing Agent and all the
Banks, PROVIDED that the Managing Agent shall not be required to act or
not act if to do so would be contrary to any Loan Document or to
applicable Law or would result, in the reasonable judgment of the
Managing Agent, in substantial risk of liability to the Managing Agent.
(d) If the Managing Agent has received a notice specified
in clause (a), the Managing Agent shall immediately give notice thereof
to the Banks and shall act or not act upon the instructions of the
Requisite Banks (or of all the Banks, to the extent required by Section
11.2), PROVIDED that the Managing Agent shall not be required to act or
not act if to do so would be contrary to any Loan Document or to
applicable Law or would result, in the reasonable judgment of the
Managing Agent, in substantial risk of liability to the Managing Agent,
and EXCEPT that if the Requisite Banks (or all the Banks, if required
under Section 11.2) fail, for five (5) Banking Days after the receipt
of notice from the Managing Agent, to instruct the Managing Agent, then
the Managing Agent, in its sole discretion, may act or not act as it
deems advisable for the protection of the interests of the Banks.
(e) The Managing Agent shall have no liability to any Bank
for acting, or not acting, as instructed by the Requisite Banks (or all
the Banks, if required under Section 11.2), notwithstanding any other
provision hereof.
10.6 LIABILITY OF MANAGING AGENT. Neither the Managing Agent nor
any of its directors, officers, agents, employees or attorneys shall be
liable for any action taken or not taken by them under or in connection with
the Loan Documents, EXCEPT for their own gross negligence or willful
misconduct. Without limitation on the foregoing, the Managing Agent and its
directors, officers, agents, employees and attorneys:
(a) May treat the payee of any Note as the holder thereof
until the Managing Agent receives notice of the assignment or transfer
thereof, in form satisfactory to the Managing Agent, signed by the
payee, and may treat each Bank as the owner of that Bank's interest in
the Obligations for all purposes of this Agreement until the Managing
Agent receives notice of the assignment or transfer thereof, in form
satisfactory to the Managing Agent,
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signed by that Bank;
(b) May consult with legal counsel (INCLUDING in-house
legal counsel), accountants (INCLUDING in-house accountants) and other
professionals or experts selected by it, or with legal counsel,
accountants or other professionals or experts for Borrowers and/or
their Subsidiaries or the Banks, and shall not be liable for any action
taken or not taken by it in good faith in accordance with any advice of
such legal counsel, accountants or other professionals or experts;
(c) Shall not be responsible to any Bank for any statement,
warranty or representation made in any of the Loan Documents or in any
notice, certificate, report, request or other statement (written or
oral) given or made in connection with any of the Loan Documents;
(d) EXCEPT to the extent expressly set forth in the Loan
Documents, shall have no duty to ask or inquire as to the performance
or observance by Borrowers or its Subsidiaries of any of the terms,
conditions or covenants of any of the Loan Documents or to inspect any
collateral or any Property, books or records of Borrowers or their
Subsidiaries;
(e) Will not be responsible to any Bank for the due
execution, legality, validity, enforceability, genuineness,
effectiveness, sufficiency or value of any Loan Document, any other
instrument or writing furnished pursuant thereto or in connection
therewith, or any collateral;
(f) Will not incur any liability by acting or not acting in
reliance upon any Loan Document, notice, consent, certificate,
statement, request or other instrument or writing believed in good
faith by it to be genuine and signed or sent by the proper party or
parties; and
(g) Will not incur any liability for any arithmetical error
in computing any amount paid or payable by the Borrowers or any
Subsidiary or Affiliate thereof or paid or payable to or received or
receivable from any Bank under any Loan Document, INCLUDING, without
limitation, principal, interest, commitment fees, Advances and other
amounts; PROVIDED that, promptly upon discovery of such an error in
computation, the Managing Agent, the Banks and
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(to the extent applicable) Borrowers and/or their Subsidiaries or
Affiliates shall make such adjustments as are necessary to correct such
error and to restore the parties to the position that they would have
occupied had the error not occurred.
10.7 INDEMNIFICATION. Each Bank shall, ratably in accordance with
its Pro Rata Share of the Commitments (if the Commitments are then in effect)
or in accordance with its proportion of the aggregate Indebtedness then
evidenced by the Notes (if the Commitments have then been terminated),
indemnify and hold the Managing Agent and its directors, officers, agents,
employees and attorneys harmless against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever (INCLUDING
reasonable attorneys' fees and disbursements and allocated costs of attorneys
employed by the Managing Agent) that may be imposed on, incurred by or
asserted against it or them in any way relating to or arising out of the Loan
Documents (other than losses incurred by reason of the failure of Borrowers
to pay the Indebtedness represented by the Notes) or any action taken or not
taken by it as Managing Agent thereunder, EXCEPT such as result from its own
gross negligence or willful misconduct. Without limitation on the foregoing,
each Bank shall reimburse the Managing Agent upon demand for that Bank's Pro
Rata Share of any out-of-pocket cost or expense incurred by the Managing
Agent in connection with the negotiation, preparation, execution, delivery,
amendment, waiver, restructuring, reorganization (INCLUDING a bankruptcy
reorganization), enforcement or attempted enforcement of the Loan Documents,
to the extent that any Borrower or any other Party is required by Section
11.3 to pay that cost or expense but fails to do so upon demand. Nothing in
this Section 10.7 shall entitle the Managing Agent or any indemnitee referred
to above to recover any amount from the Banks if and to the extent that such
amount has theretofore been recovered from Borrowers or any of their
Subsidiaries. To the extent that the Managing Agent or any indemnitee
referred to above is later reimbursed such amount by Borrowers or any of its
Subsidiaries, it shall return the amounts paid to it by the Banks in respect
of such amount.
10.8 SUCCESSOR MANAGING AGENT. The Managing Agent may, and at the
request of the Requisite Banks shall, resign as Managing Agent upon
reasonable notice to the Banks and Borrowers effective upon acceptance of
appointment by a successor Managing Agent. If the Managing Agent shall
resign as Managing Agent under this Agreement, the Requisite Banks shall
appoint from among the Banks a successor Managing Agent for the Banks, which
successor Managing Agent shall be approved by
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Borrowers (and such approval shall not be unreasonably withheld or delayed).
If no successor Managing Agent is appointed prior to the effective date of
the resignation of the Managing Agent, the Managing Agent may appoint, after
consulting with the Banks and the Borrowers, a successor Managing Agent from
among the Banks. Upon the acceptance of its appointment as successor
Managing Agent hereunder, such successor Managing Agent shall succeed to all
the rights, powers and duties of the retiring Managing Agent and the term
"Managing Agent" shall mean such successor Managing Agent and the retiring
Managing Agent's appointment, powers and duties as Managing Agent shall be
terminated. After any retiring Managing Agent's resignation hereunder as
Managing Agent, the provisions of this ARTICLE 10, and Sections 11.3, 11.11
and 11.22, shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Managing Agent under this Agreement.
Notwithstanding the foregoing, if (a) the Managing Agent has not been paid
its agency fees under Section 3.5 or has not been reimbursed for any expense
reimbursable to it under Section 11.3, in either case for a period of at
least one (1) year and (b) no successor Managing Agent has accepted
appointment as Managing Agent by the date which is thirty (30) days following
a retiring Managing Agent's notice of resignation, the retiring Managing
Agent's resignation shall nevertheless thereupon become effective and the
Banks shall perform all of the duties of the Managing Agent hereunder until
such time, if any, as the Requisite Banks appoint a successor Managing Agent
as provided for above.
10.9 NO OBLIGATIONS OF BORROWERS. Nothing contained in this
Article 10 shall be deemed to impose upon Borrowers any obligation in respect
of the due and punctual performance by the Managing Agent of its obligations
to the Banks under any provision of this Agreement, and Borrowers shall have
no liability to the Managing Agent or any of the Banks in respect of any
failure by the Managing Agent or any Bank to perform any of its obligations
to the Managing Agent or the Banks under this Agreement. Without limiting
the generality of the foregoing, where any provision of this Agreement
relating to the payment of any amounts due and owing under the Loan Documents
provides that such payments shall be made by Borrowers to the Managing Agent
for the account of the Banks, Borrowers' obligations to the Banks in respect
of such payments shall be deemed to be satisfied upon the making of such
payments to the Managing Agent in the manner provided by this Agreement.
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Article 11
MISCELLANEOUS
11.1 CUMULATIVE REMEDIES; NO WAIVER. The rights, powers,
privileges and remedies of the Managing Agent and the Banks provided herein
or in any Note or other Loan Document are cumulative and not exclusive of any
right, power, privilege or remedy provided by Law or equity. No failure or
delay on the part of the Managing Agent or any Bank in exercising any right,
power, privilege or remedy may be, or may be deemed to be, a waiver thereof;
nor may any single or partial exercise of any right, power, privilege or
remedy preclude any other or further exercise of the same or any other right,
power, privilege or remedy. The terms and conditions of ARTICLE 8 hereof are
inserted for the sole benefit of the Managing Agent and the Banks; the same
may be waived in whole or in part, with or without terms or conditions, in
respect of any Loan without prejudicing the Managing Agent's or the Banks'
rights to assert them in whole or in part in respect of any other Loan.
11.2 AMENDMENTS; CONSENTS. No amendment, modification, supplement,
extension, termination or waiver of any provision of this Agreement or any
other Loan Document, no approval or consent thereunder, and no consent to any
departure by Borrowers or any other Party therefrom, may in any event be
effective unless in writing signed by the Requisite Banks (and, in the case
of any amendment, modification or supplement of or to any Loan Document to
which any of Borrowers is a Party, signed by each such Party, and, in the
case of any amendment, modification or supplement to ARTICLE 10, signed by
the Managing Agent), and then only in the specific instance and for the
specific purpose given; and, without the approval in writing of all the
Banks, no amendment, modification, supplement, termination, waiver or consent
may be effective:
(a) To amend or modify the principal of, or the amount of
principal, principal prepayments or the rate of interest payable on,
any Note, or the amount of the Commitments or the Pro Rata Share of any
Bank or the amount of any commitment fee payable to any Bank, or any
other fee or amount payable to any Bank under the Loan Documents or to
waive an Event of Default consisting of the failure of Borrowers to pay
when due principal, interest or any fee;
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(b) To postpone any date fixed for any payment of principal
of, prepayment of principal of or any installment of interest on, any
Note or any installment of any fee, or to extend the term of the
Commitments;
(c) To amend the provisions of the definition of "REQUISITE
BANKS" or "MATURITY DATE"; or
(d) To amend or waive ARTICLE 8 or this Section 11.2; or
(e) To amend any provision of this Agreement that expressly
requires the consent or approval of all the Banks.
Any amendment, modification, supplement, termination, waiver or consent
pursuant to this Section 11.2 shall apply equally to, and shall be binding
upon, all the Banks and the Managing Agent.
11.3 COSTS, EXPENSES AND TAXES. Borrowers shall pay within five
(5) Banking Days after demand, accompanied by an invoice therefor, the
reasonable costs and expenses of the Managing Agent in connection with the
negotiation, preparation, syndication, execution and delivery of the Loan
Documents (subject to the ceiling contained in a letter agreement between
Parent and the Managing Agent) and any amendment thereto or waiver thereof.
Borrowers shall also pay on demand, accompanied by an invoice therefor, the
reasonable costs and expenses of the Managing Agent and the Banks in
connection with the refinancing, restructuring, reorganization (INCLUDING a
bankruptcy reorganization) and enforcement or attempted enforcement of the
Loan Documents, and any matter related thereto. The foregoing costs and
expenses shall include filing fees, recording fees, title insurance fees,
appraisal fees, search fees, and other out-of-pocket expenses and the
reasonable fees and out-of-pocket expenses of any legal counsel (INCLUDING
reasonably allocated costs of legal counsel employed by the Managing Agent or
any Bank), independent public accountants and other outside experts retained
by the Managing Agent or any Bank, whether or not such costs and expenses are
incurred or suffered by the Managing Agent or any Bank in connection with or
during the course of any bankruptcy or insolvency proceedings of any of
Borrowers or any Subsidiary thereof. Borrowers shall pay any and all
documentary and other taxes, EXCLUDING (i) taxes imposed on or measured in
whole or in part by its overall net income imposed on it by (A) any
jurisdiction (or political subdivision thereof) in which it is organized or
maintains its principal office
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or Eurodollar Lending Office or (B) any jurisdiction (or political
subdivision thereof) in which it is "doing business" or (ii) any withholding
taxes or other taxes based on gross income imposed by the United States of
America for any period with respect to which it has failed to provide
Borrowers with the appropriate form or forms required by Section 11.21, to
the extent such forms are then required by applicable Laws, and all costs,
expenses, fees and charges payable or determined to be payable in connection
with the filing or recording of this Agreement, any other Loan Document or
any other instrument or writing to be delivered hereunder or thereunder, or
in connection with any transaction pursuant hereto or thereto, and shall
reimburse, hold harmless and indemnify on the terms set forth in 11.11 the
Managing Agent and the Banks from and against any and all loss, liability or
legal or other expense with respect to or resulting from any delay in paying
or failure to pay any such tax, cost, expense, fee or charge or that any of
them may suffer or incur by reason of the failure of any Party to perform any
of its Obligations. Any amount payable to the Managing Agent or any Bank
under this Section 11.3 shall bear interest from the fifth Banking Day
following the date of demand for payment at the Default Rate.
11.4 NATURE OF BANKS' OBLIGATIONS. The obligations of the Banks
hereunder are several and not joint or joint and several. Nothing contained
in this Agreement or any other Loan Document and no action taken by the
Managing Agent or the Banks or any of them pursuant hereto or thereto may, or
may be deemed to, make the Banks a partnership, an association, a joint
venture or other entity, either among themselves or with the Borrowers or any
Affiliate of any of Borrowers. A default by any Bank will not increase the
Pro Rata Share of the Commitments attributable to any other Bank. Any Bank
not in default may, if it desires, assume in such proportion as the
nondefaulting Banks agree the obligations of any Bank in default, but is not
obligated to do so. The Managing Agent agrees that it will use its best
efforts either to induce the other Banks to assume the obligations of a Bank
in default or to obtain another Bank, reasonably satisfactory to Borrowers,
to replace such a Bank in default.
11.5 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties contained herein or in any other Loan
Document, or in any certificate or other writing delivered by or on behalf of
any one or more of the Parties to any Loan Document, will survive the making
of the Loans hereunder and the execution and delivery of the Notes, and have
been or will be relied upon by the Managing Agent and each Bank,
notwithstanding any investigation made by the Managing Agent or any
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Bank or on their behalf.
11.6 NOTICES. EXCEPT as otherwise expressly provided in the Loan
Documents, all notices, requests, demands, directions and other
communications provided for hereunder or under any other Loan Document must
be in writing and must be mailed, telegraphed, telecopied, dispatched by
commercial courier or delivered to the appropriate party at the address set
forth on the signature pages of this Agreement or other applicable Loan
Document or, as to any party to any Loan Document, at any other address as
may be designated by it in a written notice sent to all other parties to such
Loan Document in accordance with this Section. EXCEPT as otherwise expressly
provided in any Loan Document, if any notice, request, demand, direction or
other communication required or permitted by any Loan Document is given by
mail it will be effective on the earlier of receipt or the fourth Banking Day
after deposit in the United States mail with first class or airmail postage
prepaid; if given by telegraph or cable, when delivered to the telegraph
company with charges prepaid; if given by telecopier, when sent; if
dispatched by commercial courier, on the scheduled delivery date; or if given
by personal delivery, when delivered.
11.7 EXECUTION OF LOAN DOCUMENTS. Unless the Managing Agent
otherwise specifies with respect to any Loan Document, (a) this Agreement and
any other Loan Document may be executed in any number of counterparts and any
party hereto or thereto may execute any counterpart, each of which when
executed and delivered will be deemed to be an original and all of which
counterparts of this Agreement or any other Loan Document, as the case may
be, when taken together will be deemed to be but one and the same instrument
and (b) execution of any such counterpart may be evidenced by a telecopier
transmission of the signature of such party. The execution of this Agreement
or any other Loan Document by any party hereto or thereto will not become
effective until counterparts hereof or thereof, as the case may be, have been
executed by all the parties hereto or thereto.
11.8 BINDING EFFECT; ASSIGNMENT.
(a) This Agreement and the other Loan Documents to which
Borrowers are a Party will be binding upon and inure to the benefit of
Borrowers, the Managing Agent, each of the Banks, and their respective
successors and assigns, EXCEPT that Borrowers may not assign their
rights hereunder or thereunder or any interest herein or therein
without the prior
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written consent of all the Banks. Each Bank represents that it is not
acquiring its Note with a view to the distribution thereof within the
meaning of the Securities Act of 1933, as amended (subject to any
requirement that disposition of such Note must be within the control of
such Bank). Any Bank may at any time pledge its Note or any other
instrument evidencing its rights as a Bank under this Agreement to a
Federal Reserve Bank, but no such pledge shall release that Bank from
its obligations hereunder or grant to such Federal Reserve Bank the
rights of a Bank hereunder absent foreclosure of such pledge.
(b) From time to time following the Closing Date, each Bank
may assign to one or more Eligible Assignees all or any portion of its
Pro Rata Share of the Commitments; PROVIDED that (i) such Eligible
Assignee, if not then a Bank or an Affiliate of the assigning Bank,
shall be approved by the Managing Agent and (if no Event of Default
then exists) Borrowers (neither of which approvals shall be
unreasonably withheld or delayed), (ii) such assignment shall be
evidenced by a Commitments Assignment and Acceptance, a copy of which
shall be furnished to the Managing Agent as hereinbelow provided, (iii)
EXCEPT in the case of an assignment to an Affiliate of the assigning
Bank, to another Bank or of the entire remaining Commitments of the
assigning Bank, the assignment shall not assign a Pro Rata Share of the
Commitments that is equivalent to less than $10,000,000, (iv) the
assignment shall assign the same Pro Rata Share of the Line A
Commitment and the Line B Commitment and (v) the effective date of any
such assignment shall be as specified in the Commitments Assignment and
Acceptance, but not earlier than the date which is five (5) Banking
Days after the date the Managing Agent has received the Commitments
Assignment and Acceptance. Upon the effective date of such Commitments
Assignment and Acceptance, the Eligible Assignee named therein shall be
a Bank for all purposes of this Agreement, with the Pro Rata Share of
the Commitments therein set forth and, to the extent of such Pro Rata
Share, the assigning Bank shall be released from its further
obligations under this Agreement. Borrowers agree that they shall
execute and deliver (against delivery by the assigning Bank to
Borrowers of its Note) to such assignee Bank, Notes evidencing that
assignee Bank's Pro Rata Share of the Commitments, and to the assigning
Bank, Notes evidencing the remaining balance Pro Rata Share retained by
the assigning Bank.
(c) By executing and delivering a Commitments Assignment
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and Acceptance, the Eligible Assignee thereunder acknowledges and
agrees that: (i) other than the representation and warranty that it is
the legal and beneficial owner of the Pro Rata Share of the Commitments
being assigned thereby free and clear of any adverse claim, the
assigning Bank has made no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or the
execution, legality, validity, enforceability, genuineness or
sufficiency of this Agreement or any other Loan Document; (ii) the
assigning Bank has made no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrowers or
the performance by Borrowers of the Obligations; (iii) it has received
a copy of this Agreement, together with copies of the most recent
financial statements delivered pursuant to Section 7.1 and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Commitments Assignment
and Acceptance; (iv) it will, independently and without reliance upon
the Managing Agent or any 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 action under this
Agreement; (v) it appoints and authorizes the Managing Agent to take
such action and to exercise such powers under this Agreement as are
delegated to the Managing Agent by this Agreement; and (vi) it will
perform in accordance with their terms all of the obligations which by
the terms of this Agreement are required to be performed by it as a
Bank.
(d) The Managing Agent shall maintain at the Managing
Agent's Office a copy of each Commitments Assignment and Acceptance
delivered to it and a register (the "Register") of the names and
address of each of the Banks and the Pro Rata Share of the Commitments
held by each Bank, giving effect to each Commitments Assignment and
Acceptance. The Register shall be available during normal business
hours for inspection by Borrowers or any Bank upon reasonable prior
notice to the Managing Agent. After receipt of a completed Commitments
Assignment and Acceptance executed by any Bank and an Eligible
Assignee, and receipt of an assignment fee of $2,500 from such Bank or
Eligible Assignee, the Managing Agent shall, promptly following the
effective date thereof, provide to Borrowers and the Banks a revised
SCHEDULE 1.1 giving effect thereto. Borrowers, the Managing Agent and
the Banks shall deem and treat the Persons listed as Banks in the
Register as the
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holders and owners of the Pro Rata Share of the Commitments listed
therein for all purposes hereof, and no assignment or transfer of any
such Pro Rata Share of the Commitments shall be effective, in each case
unless and until a Commitments Assignment and Acceptance effecting the
assignment or transfer thereof shall have been accepted by the Managing
Agent and recorded in the Register as provided above. Prior to such
recordation, all amounts owed with respect to the applicable Pro Rata
Share of the Commitments shall be owed to the Bank listed in the
Register as the owner thereof, and any request, authority or consent of
any Person who, at the time of making such request or giving such
authority or consent, is listed in the Register as a Bank shall be
conclusive and binding on any subsequent holder, assignee or transferee
of the corresponding Pro Rata Share of the Commitments.
(e) Each Bank may from time to time grant participations to
one or more banks or other financial institutions (INCLUDING another
Bank but EXCLUDING an Employee Plan) in a portion of its Pro Rata Share
of the Commitments; PROVIDED, HOWEVER, that (i) such Bank's obligations
under this Agreement shall remain unchanged, (ii) such Bank shall
remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) the participating banks or other
financial institutions shall not be a Bank hereunder for any purpose
EXCEPT, if the participation agreement so provides, for the purposes of
Sections 3.7, 3.8, 11.11 and 11.22 but only to the extent that the cost
of such benefits to Borrowers does not exceed the cost which Borrowers
would have incurred in respect of such Bank absent the participation,
(iv) Borrowers, the Managing Agent and the other Banks shall continue
to deal solely and directly with such Bank in connection with such
Bank's rights and obligations under this Agreement, (v) the
participation interest shall be expressed as a percentage of the
granting Bank's Pro Rata Share of the Commitments as it then exists and
shall not restrict an increase in the Commitments, or in the granting
Bank's Pro Rata Share of the Commitments, so long as the amount of the
participation interest is not affected thereby and (vi) the consent of
the holder of such participation interest shall not be required for
amendments or waivers of provisions of the Loan Documents OTHER THAN
those which (A) extend any Amortization Date, the Maturity Date or any
other date upon which any payment of money is due to the Banks, or (B)
reduce the rate of interest on the Notes, any fee or any other monetary
amount payable to the Banks or (C) reduce the amount of any installment
of principal due under
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the Notes.
11.9 RIGHT OF SETOFF. If an Event of Default has occurred and is
continuing, the Managing Agent or any Bank (but in each case only with the
consent of the Requisite Banks) may exercise its rights under Article 9 of
the Uniform Commercial Code and other applicable Laws and, to the extent
permitted by applicable Laws, apply any funds in any deposit account
maintained with it by Borrowers and/or any Property of Borrowers in its
possession against the Obligations.
11.10 SHARING OF SETOFFS. Each Bank severally agrees that if it,
through the exercise of any right of setoff, banker's lien or counterclaim
against Borrowers, or otherwise, receives payment of the Obligations held by
it that is ratably more than any other Bank, through any means, receives in
payment of the Obligations held by that Bank, then, subject to applicable
Laws: (a) the Bank exercising the right of setoff, banker's lien or
counterclaim or otherwise receiving such payment shall purchase, and shall be
deemed to have simultaneously purchased, from each of the other Banks a
participation in the Obligations held by the other Banks and shall pay to the
other Banks a purchase price in an amount so that the share of the
Obligations held by each Bank after the exercise of the right of setoff,
banker's lien or counterclaim or receipt of payment shall be in the same
proportion that existed prior to the exercise of the right of setoff,
banker's lien or counterclaim or receipt of payment; and (b) such other
adjustments and purchases of participations shall be made from time to time
as shall be equitable to ensure that all of the Banks share any payment
obtained in respect of the Obligations ratably in accordance with each Bank's
share of the Obligations immediately prior to, and without taking into
account, the payment; PROVIDED that, if all or any portion of a
disproportionate payment obtained as a result of the exercise of the right of
setoff, banker's lien, counterclaim or otherwise is thereafter recovered from
the purchasing Bank by Borrowers or any Person claiming through or succeeding
to the rights of Borrowers, the purchase of a participation shall be
rescinded and the purchase price thereof shall be restored to the extent of
the recovery, but without interest. Each Bank that purchases a participation
in the Obligations pursuant to this Section 11.10 shall from and after the
purchase have the right to give all notices, requests, demands, directions
and other communications under this Agreement with respect to the portion of
the Obligations purchased to the same extent as though the purchasing Bank
were the original owner of the Obligations purchased. Borrowers expressly
consent to the foregoing arrangements and agree that any Bank holding a
participation in an Obligation so purchased pursuant to this Section 11.10
may exercise any and all rights of
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setoff, banker's lien or counterclaim with respect to the participation as
fully as if the Bank were the original owner of the Obligation purchased.
11.11 INDEMNITY BY BORROWERS. Borrowers agree to indemnify, save
and hold harmless the Managing Agent and each Bank and their respective
directors, officers, agents, attorneys and employees (collectively the
"INDEMNITEES") from and against: (a) any and all claims, demands, actions or
causes of action (EXCEPT a claim, demand, action, or cause of action for any
amount excluded from the definition of "Taxes" in Section 3.12(d)) if the
claim, demand, action or cause of action arises out of or relates to any act
or omission (or alleged act or omission) of Borrowers, their Affiliates or
any of their officers, directors or stockholders relating to the Commitments,
the use or contemplated use of proceeds of any Loan, or the relationship of
Borrowers and the Banks under this Agreement; (b) any administrative or
investigative proceeding by any Governmental Agency arising out of or related
to a claim, demand, action or cause of action described in clause (a) above;
and (c) any and all liabilities, losses, costs or expenses (INCLUDING
reasonable attorneys' fees and the reasonably allocated costs of attorneys
employed by any Indemnitee and disbursements of such attorneys and other
professional services) that any Indemnitee suffers or incurs as a result of
the assertion of any foregoing claim, demand, action or cause of action;
PROVIDED that no Indemnitee shall be entitled to indemnification for any loss
caused by its own gross negligence or willful misconduct or for any loss
asserted against it by another Indemnitee. If any claim, demand, action or
cause of action is asserted against any Indemnitee, such Indemnitee shall
promptly notify Borrowers, but the failure to so promptly notify Borrowers
shall not affect Borrowers' obligations under this Section unless such
failure materially prejudices Borrowers' right to participate in the contest
of such claim, demand, action or cause of action, as hereinafter provided.
Such Indemnitee may (and shall, if requested by Borrowers in writing) contest
the validity, applicability and amount of such claim, demand, action or cause
of action and shall permit Borrowers to participate in such contest. Any
Indemnitee that proposes to settle or compromise any claim or proceeding for
which Borrowers may be liable for payment of indemnity hereunder shall give
Borrowers written notice of the terms of such proposed settlement or
compromise reasonably in advance of settling or compromising such claim or
proceeding and shall obtain Borrowers' prior consent (which shall not be
unreasonably withheld or delayed). In connection with any claim, demand,
action or cause of action covered by this Section 11.11 against more than one
Indemnitee, all such Indemnitees shall be represented by the same legal
counsel (which may be a law firm engaged by the Indemnitees or attorneys
employed by an
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Indemnitee or a combination of the foregoing) selected by the Indemnitees and
reasonably acceptable to Borrowers; PROVIDED, that if such legal counsel
determines in good faith that representing all such Indemnitees would or
could result in a conflict of interest under Laws or ethical principles
applicable to such legal counsel or that a defense or counterclaim is
available to an Indemnitee that is not available to all such Indemnitees,
then to the extent reasonably necessary to avoid such a conflict of interest
or to permit unqualified assertion of such a defense or counterclaim, each
affected Indemnitee shall be entitled to separate representation by legal
counsel selected by that Indemnitee and reasonably acceptable to Borrowers,
with all such legal counsel using reasonable efforts to avoid unnecessary
duplication of effort by counsel for all Indemnitees; and FURTHER PROVIDED
that the Managing Agent (as an Indemnitee) shall at all times be entitled to
representation by separate legal counsel (which may be a law firm or
attorneys employed by the Managing Agent or a combination of the foregoing).
Any obligation or liability of Borrowers to any Indemnitee under this Section
11.11 shall survive the expiration or termination of this Agreement and the
repayment of all Loans and the payment and performance of all other
Obligations owed to the Banks.
11.12 NONLIABILITY OF THE BANKS. Borrowers acknowledge and agree
that:
(a) Any inspections of any Property of Borrowers made by or
through the Managing Agent or the Banks are for purposes of
administration of the Loan only and Borrowers are not entitled to rely
upon the same (whether or not such inspections are at the expense of
Borrowers);
(b) By accepting or approving anything required to be
observed, performed, fulfilled or given to the Managing Agent or the
Banks pursuant to the Loan Documents, neither the Managing Agent nor
the Banks shall be deemed to have warranted or represented the
sufficiency, legality, effectiveness or legal effect of the same, or of
any term, provision or condition thereof, and such acceptance or
approval thereof shall not constitute a warranty or representation to
anyone with respect thereto by the Managing Agent or the Banks;
(c) The relationship between Borrowers and the Managing
Agent and the Banks is, and shall at all times remain, solely that of
borrowers and lenders; neither the Managing Agent nor the Banks shall
under any
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circumstance be construed to be partners or joint venturers of Borrowers
or their Affiliates; neither the Managing Agent nor the Banks shall
under any circumstance be deemed to be in a relationship of confidence
or trust or a fiduciary relationship with Borrowers or their Affiliates,
or to owe any fiduciary duty to Borrowers or their Affiliates; neither
the Managing Agent nor the Banks undertake or assume any responsibility
or duty to Borrowers or their Affiliates to select, review, inspect,
supervise, pass judgment upon or inform Borrowers or their Affiliates of
any matter in connection with their Property or the operations of
Borrowers or their Affiliates; Borrowers and their Affiliates shall rely
entirely upon their own judgment with respect to such matters; and any
review, inspection, supervision, exercise of judgment or supply of
information undertaken or assumed by the Managing Agent or the Banks in
connection with such matters is solely for the protection of the
Managing Agent and the Banks and neither Borrowers nor any other Person
is entitled to rely thereon; and
(d) The Managing Agent and the Banks shall not be responsible or
liable to any Person for any loss, damage, liability or claim of any
kind relating to injury or death to Persons or damage to Property caused
by the actions, inaction or negligence of Borrowers and/or its
Affiliates and Borrowers hereby indemnify and hold the Managing Agent
and the Banks harmless on the terms set forth in Section 11.11 from any
such loss, damage, liability or claim.
11.13 NO THIRD PARTIES BENEFITED. This Agreement is made for the
purpose of defining and setting forth certain obligations, rights and duties
of Borrowers, the Managing Agent and the Banks in connection with the Loans,
and is made for the sole benefit of Borrowers, the Managing Agent and the
Banks, and the Managing Agent's and the Banks' successors and assigns.
EXCEPT as provided in Sections 11.8 and 11.11, no other Person shall have any
rights of any nature hereunder or by reason hereof.
11.14 CONFIDENTIALITY. Each Bank agrees to hold any confidential
information that it may receive from Borrowers pursuant to this Agreement in
confidence, EXCEPT for disclosure: (a) to other Banks; (b) to legal counsel
and accountants for Borrowers or any Bank; (c) to other professional advisors
to Borrowers or any Bank, provided that the recipient has accepted such
information subject to a confidentiality agreement substantially similar to
this Section 11.14; (d) to regulatory officials having jurisdiction over that
Bank; (e) as required by Law or legal process,
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provided that each Bank agrees to notify Borrowers of any such disclosures
unless prohibited by applicable Laws, or in connection with any legal
proceeding to which that Bank and any of Borrowers are adverse parties; and
(f) to another financial institution in connection with a disposition or
proposed disposition to that financial institution of all or part of that
Bank's interests hereunder or a participation interest in its Notes, provided
that the recipient has accepted such information subject to a confidentiality
agreement substantially similar to this Section 11.14. For purposes of the
foregoing, "confidential information" shall mean any information respecting
Parent or its Subsidiaries reasonably considered by Borrowers to be
confidential, OTHER THAN (i) information previously filed with any
Governmental Agency and available to the public, (ii) information previously
published in any public medium from a source other than, directly or
indirectly, that Bank, and (iii) information previously disclosed by
Borrowers to any Person not associated with Borrowers which does not owe a
professional duty of confidentiality to Borrowers or which has not executed
an appropriate confidentiality agreement with Borrowers. Nothing in this
Section shall be construed to create or give rise to any fiduciary duty on
the part of the Managing Agent or the Banks to Borrowers.
11.15 FURTHER ASSURANCES. Borrowers shall, at their expense and
without expense to the Banks or the Managing Agent, do, execute and deliver
such further acts and documents as the Requisite Banks or the Managing Agent
from time to time reasonably require for the assuring and confirming unto the
Banks or the Managing Agent of the rights hereby created or intended now or
hereafter so to be, or for carrying out the intention or facilitating the
performance of the terms of any Loan Document.
11.16 INTEGRATION. This Agreement, together with the other Loan
Documents and the letter agreements referred to in Sections 3.2, 3.5 and
11.3, comprises the complete and integrated agreement of the parties on the
subject matter hereof and supersedes all prior agreements, written or oral,
on the subject matter hereof. In the event of any conflict between the
provisions of this Agreement and those of any other Loan Document, the
provisions of this Agreement shall control and govern; PROVIDED that the
inclusion of supplemental rights or remedies in favor of the Managing Agent
or the Banks in any other Loan Document shall not be deemed a conflict with
this Agreement. Each Loan Document was drafted with the joint participation
of the respective parties thereto and shall be construed neither against nor
in favor of any party, but rather in accordance with the fair meaning thereof.
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11.17 GOVERNING LAW. EXCEPT to the extent otherwise provided
therein, each Loan Document shall be governed by, and construed and enforced
in accordance with, the Laws of California applicable to contracts made and
performed in California.
11.18 SEVERABILITY OF PROVISIONS. Any provision in any Loan
Document that is held to be inoperative, unenforceable or invalid as to any
party or in any jurisdiction shall, as to that party or jurisdiction, be
inoperative, unenforceable or invalid without affecting the remaining
provisions or the operation, enforceability or validity of that provision as
to any other party or in any other jurisdiction, and to this end the
provisions of all Loan Documents are declared to be severable.
11.19 HEADINGS. Article and Section headings in this Agreement
and the other Loan Documents are included for convenience of reference only
and are not part of this Agreement or the other Loan Documents for any other
purpose.
11.20 TIME OF THE ESSENCE. Time is of the essence of the Loan
Documents.
11.21 FOREIGN BANKS AND PARTICIPANTS. Each Bank that is
incorporated or otherwise organized under the Laws of a jurisdiction other
than the United States of America or any State thereof or the District of
Columbia shall deliver to Borrowers (with a copy to the Managing Agent), on
or before the Closing Date (or on or before accepting an assignment or
receiving a participation interest herein pursuant to Section 11.8, if
applicable) two duly completed copies, signed by a Responsible Official, of
either Form 1001 (relating to such Bank and entitling it to a complete
exemption from withholding on all payments to be made to such Bank by
Borrowers pursuant to this Agreement) or Form 4224 (relating to all payments
to be made to such Bank by the Borrowers pursuant to this Agreement) of the
United States Internal Revenue Service or such other evidence (INCLUDING, if
reasonably necessary, Form W-9) satisfactory to Borrowers and the Managing
Agent that no withholding under the federal income tax laws is required with
respect to such Bank. Thereafter and from time to time, each such Bank shall
(a) promptly submit to Borrowers (with a copy to the Managing Agent), such
additional duly completed and signed copies of one of such forms (or such
successor forms as shall be adopted from time to time by the relevant United
States taxing authorities) as may then be available under then current United
States laws and regulations to avoid, or such evidence as is satisfactory to
Borrowers and the Managing Agent of any available exemption from, United
States withholding
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taxes in respect of all payments to be made to such Bank by Borrowers
pursuant to this Agreement and (b) take such steps as shall not be materially
disadvantageous to it, in the reasonable judgment of such Bank, and as may be
reasonably necessary (including the re-designation of its Eurodollar Lending
Office, if any) to avoid any requirement of applicable Laws that Borrowers
make any deduction or withholding for taxes from amounts payable to such
Bank. In the event that Borrowers or the Managing Agent become aware that a
participation has been granted pursuant to Section 11.8(e) to a financial
institution that is incorporated or otherwise organized under the Laws of a
jurisdiction other than the United States of America, any State thereof or
the District of Columbia, then, upon request made by Borrowers or the
Managing Agent to the Bank which granted such participation, such Bank shall
cause such participant financial institution to deliver the same documents
and information to Borrowers and the Managing Agent as would be required
under this Section if such financial institution were a Bank.
11.22 HAZARDOUS MATERIAL INDEMNITY. Each of Borrowers hereby
agrees to indemnify, hold harmless and defend (by counsel reasonably
satisfactory to the Managing Agent) the Managing Agent and each of the Banks
and their respective directors, officers, employees, agents, successors and
assigns from and against any and all claims, losses, damages, liabilities,
fines, penalties, charges, administrative and judicial proceedings and
orders, judgments, remedial action requirements, enforcement actions of any
kind, and all costs and expenses incurred in connection therewith (including
but not limited to reasonable attorneys' fees and the reasonably allocated
costs of attorneys employed by the Managing Agent or any Bank, and expenses
to the extent that the defense of any such action has not been assumed by
Borrowers), arising directly or indirectly out of (i) the presence on, in,
under or about any Real Property of any Hazardous Materials, or any releases
or discharges of any Hazardous Materials on, under or from any Real Property
and (ii) any activity carried on or undertaken on or off any Real Property by
Borrowers or any of its predecessors in title, whether prior to or during the
term of this Agreement, and whether by Borrowers or any predecessor in title
or any employees, agents, contractors or subcontractors of Borrowers or any
predecessor in title, or any third persons at any time occupying or present
on any Real Property, in connection with the handling, treatment, removal,
storage, decontamination, clean-up, transport or disposal of any Hazardous
Materials at any time located or present on, in, under or about any Real
Property. The foregoing indemnity shall further apply to any residual
contamination on, in, under or about any Real Property, or affecting any
natural resources, and to any contamination of any Property or natural
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resources arising in connection with the generation, use, handling, storage,
transport or disposal of any such Hazardous Materials, and irrespective of
whether any of such activities were or will be undertaken in accordance with
applicable Laws, but the foregoing indemnity shall not apply to Hazardous
Materials on any Real Property, the presence of which is caused by the
Managing Agent or the Banks. Borrowers hereby acknowledge and agree that,
notwithstanding any other provision of this Agreement or any of the other
Loan Documents to the contrary, the obligations of Borrowers under this
Section (and under Sections 4.18 and 5.10) shall be unlimited corporate
obligations of Borrowers and shall NOT be secured by any Lien on any Real
Property. Any obligation or liability of Borrowers to any Indemnitee under
this Section 11.22 shall survive the expiration or termination of this
Agreement and the repayment of all Loans and the payment and performance of
all other Obligations owed to the Banks.
11.23 JOINT AND SEVERAL. Each of Borrowers shall be obligated for
all of the Obligations on a joint and several basis, notwithstanding which of
Borrowers may have directly received the proceeds of any particular Loan.
Each of Borrowers acknowledges and agrees that, for purposes of the Loan
Documents, Borrowers constitute a single integrated financial enterprise and
that each receives a benefit from the availability of credit under this
Agreement to all of Borrowers. Each of Borrowers waive all defenses arising
under the Laws of suretyship, to the extent such Laws are applicable, in
connection with its joint and several obligations under this Agreement.
Without limiting the foregoing, each of Borrowers agrees to the Joint
Borrower Provisions set forth in EXHIBIT L, incorporated by this reference.
11.24 REMOVAL OF A BANK. As provided in Sections 2.9, 3.7 and
3.8, Borrowers shall have the right to remove a Bank as a party to this
Agreement if such Bank refuses (under certain circumstances) to consent to an
extension of the Revolver Termination Date made pursuant to Section 2.9 or if
such Bank is paid a material amount by Borrowers pursuant to Section 3.7 or
Section 3.8. Upon notice from Borrowers, such Bank shall execute and deliver
a Commitment Assignment and Acceptance covering that Bank's Pro Rata Share of
the Commitments in favor of such Eligible Assignee as Borrowers may
designate, subject to payment in full by such Eligible Assignee of all
principal, interest and fees owing to such Bank through the date of
assignment. In addition (but only if Borrowers' right to remove the Bank
arises under Section 2.9(b)), Borrowers may reduce the Commitments pursuant
to Section 2.7 (and, for this purpose, the numerical requirements of such
Section shall not apply) by an amount equal to that Bank's Pro Rata Share of
the Commitments, pay to such Bank all principal, interest and fees owing to
such Bank and release such Bank from its Pro
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Rata Share of the Commitments.
11.25 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS
AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY
WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTY
HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS
RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS
AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY
COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE
WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
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11.26 PURPORTED ORAL AMENDMENTS. BORROWERS EXPRESSLY ACKNOWLEDGE
THAT THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY ONLY BE AMENDED OR
MODIFIED, OR THE PROVISIONS HEREOF OR THEREOF WAIVED OR SUPPLEMENTED, BY AN
INSTRUMENT IN WRITING THAT COMPLIES WITH SECTION 11.2. BORROWERS AGREE THAT
THEY WILL NOT RELY ON ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR ORAL
OR WRITTEN STATEMENTS BY ANY REPRESENTATIVE OF THE MANAGING AGENT OR ANY BANK
THAT DOES NOT COMPLY WITH SECTION 11.2 TO EFFECT AN AMENDMENT, MODIFICATION,
WAIVER OR SUPPLEMENT TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.
ALEXANDRIA REAL ESTATE EQUITIES, INC.
By: /s/ Joel S. Marcus
---------------------------------
Joel S. Marcus
Chief Executive Officer
ARE-QRS, INC. [sic]
By: /s/ Joel S. Marcus
---------------------------------
Its: Chief Executive Officer
----------------------------
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ARE ACQUISITIONS, LLC
By: ARE-QRS Corp., its Managing Member
By: /s/ Joel S. Marcus
---------------------------------
Its: Chief Executive Officer
----------------------------
Address for all the foregoing:
Alexandria Real Estate Equities, Inc.
251 South Lake Avenue
Pasadena, California 91101
Attn: Joel S. Marcus
Chief Executive Officer
Telecopier: (818) 578-0770
Telephone: (818) 578-0777
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BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Managing Agent
By: /s/ William Rothman
---------------------------------
William Rothman
Regional Vice President
Address:
Bank of America National Trust and
Savings Association
CRESG
555 South Flower Street, 6th Floor
Los Angeles, California 90071
Attn: William Rothman
Telecopier: (213) 228-5389
Telephone: (213) 228-4153
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BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as a Bank
By: /s/ Carol Settles
---------------------------------
Carol Settles
Vice President
Address:
Bank of America National Trust and
Savings Association,
555 South Flower Street, 6th Floor
Los Angeles, California 90071
Attn: Carol Settles
Telecopier: (213) 228-5389
Telephone: (213) 228-5286
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