EXHIBIT 10.29.2
CHANGE IN TERMS AGREEMENT
This Change in Terms Agreement (this "Agreement") is made as of and
delivered on July 22, 2005, by and between Mission West Properties, Inc., a
Maryland corporation ("Borrower"), and Cupertino National Bank (the "Bank").
RECITALS
A. As of July 12, 2002, the Bank and Borrower entered into certain
agreements (the "2002 Loan Documents") including but not limited to a Revolving
Credit Loan Agreement pursuant to which the Bank agreed, subject to the terms
and conditions set forth therein, to lend up to the sum of Forty Million Dollars
($40,000,000.00) to Borrower, pursuant to which the Bank lent certain amounts to
Borrower, and pursuant to which Borrower agreed to repay the loan on or before
November 2, 2004.
B. As of November 2, 2004, at Borrower's request, the Bank and Borrower
entered into certain agreements (the "Loan Documents") including but not limited
to a Revolving Credit Note and a Revolving Credit Loan Agreement (the "Credit
Agreement") pursuant to which, subject to the terms and conditions stated
therein, the Bank agreed to refinance the amounts due and owing under the 2002
Loan Documents and continue to lend to Borrower and pursuant to which the Bank
lent certain amounts to Borrower. Also as of November 2, 2004, MWP executed a
Continuing Guaranty (the "MWP Guaranty") guarantying Borrower's obligations to
the Bank. Unless expressly stated to the contrary herein, all capitalized terms
used herein shall have the meaning ascribed to them in the Loan Documents.
C. Pursuant to the Loan Documents, Borrower is currently indebted to the
Bank in the principal sum of Twenty-Three Million Nine Hundred Thirteen
Thousand, Ninety-Five and 24/100 Dollars ($23,913,095.24), plus interest and
fees thereon.
D. Included among the Loan Documents is a Non-Encumbrance Agreement (the
"Non-Encumbrance Agreement") pursuant to which Borrower and MWP agreed, among
other things, not to encumber, transfer, or hypothecate any of the MWP Pool
Properties. MWP now desires to refinance two of such properties, that property
located at 5325-5345 Hellyer Avenue, San Jose, California (the "Hellyer
Property") and that property located at 1768 Automation, San Jose, California
(the "Automation Property"), and Borrower has requested that the Bank release
such properties from the MWP Pool Properties in the Non-Encumbrance Agreement.
E. Pursuant to the Loan Documents, Borrower is not entitled to borrow more
than Forty Million Dollars ($40,000,000.00) or more than fifty percent (50%) of
the total combined Value of the MWP Pool Properties. If the Hellyer Property and
the Automation Property are released from the MWP Pool Properties, the only
property remaining within the MWP Pool Properties will be that property located
at 5970 Optical Court, San Jose, California (the "Optical Property"), and
Borrower will be over-advanced by the sum of Thirteen Million One Hundred
Twenty-Five Thousand Seven Hundred Thirty-Five Dollars ($13,125,735.00).
F. The Bank is willing, subject to the terms and conditions set forth
herein, to release the Hellyer Property and the Automation Property.
In consideration of the premises and the mutual promises herein contained
and in reliance upon Borrower's representations and warranties set forth herein,
Borrower and the Bank agree as follows:
AGREEMENT
1. INCORPORATION OF RECITALS. Each of the foregoing Recitals is hereby
incorporated herein by this reference as though set forth in full herein.
2. CONDITIONS. At the Bank's option and for its benefit, the effectiveness
of this Agreement and the Bank's obligations hereunder are conditioned upon the
satisfaction of each and all of the following conditions (the "Conditions") on
or before July 22, 2005:
(a) Borrower shall have executed and delivered to the Bank this
Agreement;
(b) Borrower and MWP shall have executed and delivered to the Bank a
First Amendment to Non-Encumbrance Agreement in the form attached hereto as
Exhibit A;
(c) MWP shall have executed and delivered to the Bank a Reaffirmation
of Guaranty in the form attached hereto as Exhibit B (this Agreement, the
First Amendment to Non-Encumbrance Agreement, and the Reaffirmation of
Guaranty are hereinafter collectively referred to as the "Modification
Agreements");
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(d) Borrower shall have paid to the Bank a payment of Fourteen Million
Nine Hundred Thirteen Thousand Ninety-Five and 24/100 Dollars
($14,913,095.24) in order to reduce the principal amount due under the Loan
Documents to Nine Million Dollars ($9,000,000.00); and
(e) Borrower shall have paid to the Bank the sum of Two Thousand
Sixty-Five Dollars ($2,065.00) as and for attorneys' fees incurred by the
Bank in connection with the preparation of the Modification Agreements.
3. RELEASE OF HELLYER PROPERTY AND AUTOMATION PROPERTY. Upon the
satisfaction of the Conditions, the Bank shall execute and deliver to Borrower
the Non-Encumbrance Agreement releasing the Hellyer Property and the Automation
Property from the MWP Pool Properties.
4. COMMITMENT AMOUNT. The definition of "Commitment Amount" in Section 1.1
of the Credit Agreement is hereby replaced in full by the following: "Commitment
Amount" shall mean, as of any applicable date of determination, the lesser of
(i) Nine Million Dollars and no cents ($9,000,000.00); and (ii) fifty percent
(50%) of the Value of the MWP Pool Properties.
5. ADDITION OF PROPERTIES TO MWP POOL PROPERTIES AND INCREASE IN COMMITMENT
AMOUNT. The Bank agrees to permit Borrower to add real property (the "Additional
Property") to the MWP Pool Properties and to increase the Commitment Amount by
fifty percent (50%) of the Value of the Additional Real Property, except that in
no event shall the Commitment Amount exceed 40 Million Dollars ($40,000,000.00),
and the Bank's agreement shall be subject to the following terms and conditions,
the satisfaction of which are to be determined by the Bank in its sole and
absolute discretion:
(a) Borrower makes written request to the Bank for the addition of the
Additional Property and the increase in the Commitment Amount, including
with its written request the following:
(i) An identification of the Additional Property and the
entity-which shall be either Borrower, MWP, or another limited
partnership of which Borrower is the general partner (each one of the
foregoing hereinafter a "Permitted Owner")-which is the owner of fee
simple title to the Additional Property; Borrower's statement of the
then-current Value of the Additional Property (the "Borrower's
Valuation Statement"); copies of all leases of the Additional
Property;
(ii) A statement by the Permitted Owner of the Additional
Property that it consents to the addition of the Additional Property
to the MWP Pool Properties and that it is willing to execute all
documents required by the Bank to effect the addition and is willing
to execute a Guaranty of Borrower's obligations to the Bank in the
same form and content as the MWP Guaranty; and
(iii) A statement by MWP and any other persons or entities that
have executed guaranties of Borrower's obligations to the Bank
(collectively, the "Guarantors") that they consent to the addition of
the Additional Property and the increase in the Commitment Amount and
that they are willing to execute reaffirmations of their guaranties in
form and substance acceptable to the Bank in its sole and absolute
discretion setting forth their consent and their reaffirmation of
their guaranties.
(b) The Permitted Owner is the owner of fee simple title to the
Additional Property.
(c) The Additional Property is free and clear of any liens,
encumbrances, deeds of trusts, and mortgages.
(d) The Permitted Owner, if MWP, executes a modification of the
Non-Encumbrance Agreement, and, if not MWP, a non-encumbrance agreement in
the same form as the Non-Encumbrance Agreement executed by MWP, adding the
Additional Property to the MWP Pool Properties, and also executes any other
documents required by the Bank to effect the addition.
(e) The Guarantors execute reaffirmations of their guaranties in form
and substance acceptable to the Bank in its sole and absolute discretion
setting forth their consent to the addition of the Additional Property and
the increase in the Commitment Amount, and their reaffirmation of their
guaranties.
(f) Borrower and the Permitted Owner provide to the Bank any and all
information and documents requested by the Bank relating to the Additional
Property including without limitation information and documents relating to
leases, tenants, and value.
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(g) Borrower and the Permitted Owner provide to the Bank all
representations, warranties, and other assurances requested by the Bank
relating to Permitted Owner's fee ownership of the Additional Property and
such property's lien and encumbrance-free status.
(h) Borrower has complied with all its obligations under the Loan
Documents and the Modification Agreements including but not limited to
paying the Minimum Annual Fee of Eighty Thousand Dollars and no cents
($80,000.00) pursuant to and by the dates set forth in Section 2.10.1 of
the Credit Agreement. There is no Default or Event of Default under or as
defined in the Loan Documents as modified by the Modification Agreements or
under the Modification Agreements; there is no default under any guaranty
executed by any of the Guarantors in favor of the Bank; Borrower is not in
default under any other agreement with the Bank.
(i) Borrower pays all reasonable fees and out-of-pocket costs incurred
by the Bank relating to the addition of the Additional Property including
without limitation attorneys' fees and costs.
(j) In its sole and absolute discretion, the Bank is satisfied with
the accuracy of the Borrower's Valuation Statement and agrees to the
addition of the Additional Property and the increase in the Commitment
Amount.
6. Except as expressly modified by the Modification Agreements, the Loan
Documents are hereby reaffirmed by all parties thereto and are incorporated into
this Agreement.
7. Borrower acknowledges that it has executed this Agreement in reliance on
its own independent investigation and analysis of the facts underlying the
subject matter of the Agreement, and that, in executing this Agreement, no
representations, warranties, or promises of any kind have been made directly or
indirectly to induce it to execute this Agreement other than those that are
expressly set forth herein, and that it has not relied on any representations,
warranties, or promises of any kind other than those that are expressly set
forth herein.
8. The Modification Agreements are integrated agreements. Except for the
Loan Documents as modified by the Modification Agreements, the Modification
Agreements supersede all prior representations and agreements, if any, between
the parties to this Agreement and their respective legal counsel relating to the
subject matter hereof, contain the entire and only understanding between the
parties, and may not be altered, amended or extinguished, except by a writing
signed subsequent to the execution of the Modification Agreements.
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IN WITNESS WHEREOF, THE BORROWER AND THE BANK HAVE CAUSED THIS AGREEMENT TO BE
EXECUTED BY THEIR DULY AUTHORIZED OFFICERS AS OF THE DAY AND YEAR FIRST WRITTEN
ABOVE.
MISSION WEST PROPERTIES, INC.
A Maryland corporation
By: /s/ Carl E. Berg
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Its: Chairman & CEO
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By: /s/ Raymond V. Marino
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Its: President & COO
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CUPERTINO NATIONAL BANK
By: /s/ Roxanne Vane
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Its: Senior Vice President
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