Borrowing Base Properties. To each Borrower’s knowledge and except (i) as disclosed in the Real Property Information delivered to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property: (a) Each Borrowing Base Property Owner has good record and marketable title in fee simple to all Borrowing Base Properties necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01). (b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent; (c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements; (d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property; (e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied; (f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits); (g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and (h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event with respect to any such Borrowing Base Property has occurred.
Appears in 3 contracts
Sources: Credit Agreement (Vinebrook Homes Trust, Inc.), Increase Agreement, Joinder, and Second Amendment to Credit Agreement (Vinebrook Homes Trust, Inc.), Revolving Credit Agreement (Vinebrook Homes Trust, Inc.)
Borrowing Base Properties. To each Borrower’s knowledge and except (a) (i) as disclosed Borrower shall own at least three (3) Borrowing Base Properties at all times, of which no fewer than two (2) must be located in the Real Property Information delivered to Administrative Agent, and United States of America; (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any no Borrowing Base Property:
(a) Each Property and no Capital Stock in any Borrowing Base Property Owner has good record and marketable title in fee simple shall at any time be subject to all or encumbered by (A) any Indebtedness other than Permitted Borrowing Base Debt, or (B) any Lien other than a Permitted Borrowing Base Lien, (iii) no more than three (3) Properties located outside of the United State of America may qualify as Borrowing Base Properties necessary or used in the ordinary conduct of its businessat any time, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such and (iv) no more than two (2) Borrowing Base Property. Each applicable Properties may include a condominium or timeshare component or otherwise be part of a condominium or similar development that includes a residential/hotel condominium, fractional interest or timeshare component, in any such case unless otherwise agreed by the Required Lenders, and (v) at least three (3) Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned Properties shall at all times qualify as “luxury” or “upper-upscale” hotels, as designated by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower ▇▇▇▇▇ Travel Research (or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted similar successor company designated by Section 6.01Administrative Agent).
(b) Each A Property may cease to qualify as a Borrowing Base Property, but may subsequently regain its status as a Borrowing Base Property complies as provided in all clause (c) below.
(c) The Properties approved as Borrowing Base Properties as of the Closing Date are set forth on Schedule II hereto. Borrower may propose to include additional Properties (whether New Acquisitions, former Development Properties or Properties that had been Borrowing Base Properties but ceased to qualify as such) by sending written proposals for inclusion to the Administrative Agent together with (i) a certification by the Borrower that such Property then satisfies the criteria for a Borrowing Base Property or, if a waiver or discretionary approval is required with respect to any element thereof, so specifying, (ii) reasonable supporting documentation with respect to each of the elements of such certification or request, (iii) an Acceptable Appraisal of the proposed Borrowing Base Property and (iv) a Title Search with respect to such proposed Borrowing Base Property. The Administrative Agent will make such request and materials available to the Lenders and will endeavor promptly either to (A) accept in writing the Borrower’s certification that such Property satisfies the criteria and is deemed a Borrowing Base Property (or specify the reason it is unable to so accept) or (B) solicit the consent or waiver of the Required Lenders with respect to any matter so requested by the Borrower.
(d) Borrower shall promptly after any Responsible Officer of the Borrower obtains knowledge thereof notify Administrative Agent of: (i) any material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on structural defects or Environmental Occurrence affecting a Borrowing Base Property or (ii) the occurrence of any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that casualty event affecting a Borrowing Base Property, or (iii) any use, activity, operation, other event or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to occurrence which would cause a Borrowing Base PropertyProperty to cease to qualify as such. In such event, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each affected Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinanceswill immediately, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered occurrence, cease to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included qualify as a Borrowing Base Property under Section 2.23(d)(ii) andhereunder, except as previously disclosed to the Administrative Agent extent provided in writingthe following sentence. In the event that structural defects, no Exclusion Event with respect Environmental Occurrence or casualty result in the temporary closure (for repair, restoration or remediation) of less than 25% of the rooms in such hotel and provided that the applicable Property Owner has given reasonable security to any the Lenders to insure that such repair, restoration or remediation will be promptly and diligently resolved in a good and ▇▇▇▇▇▇▇-like manner within one hundred twenty (120) days, then such Property will not cease to qualify as a Borrowing Base Property has occurredfor so long as such conditions remain satisfied and provided that such issues are finally repaired or resolved within one hundred twenty (120) day period.
Appears in 3 contracts
Sources: Credit Agreement (Strategic Hotels & Resorts, Inc), Credit Agreement (Strategic Hotels & Resorts, Inc), Credit Agreement (Strategic Hotels & Resorts, Inc)
Borrowing Base Properties. To each Borrower’s knowledge (1) With respect to any Net Cash Proceeds realized or received with respect to any Insurance and except (i) as disclosed in Condemnation Event at a Borrowing Base Property, the Real Property Information delivered Net Cash Proceeds shall at the request of Administrative Agent, be paid directly to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Propertyprovided that:
(aI) Each Borrowing Base Property Owner has good record if the Net Cash Proceeds are less than $1,000,000 and marketable title in fee simple to all Borrowing Base Properties necessary there is no Event of Default that remains unwaived or used in uncured, the ordinary conduct of its business, except for Administrative Agent shall release such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title Net Cash Proceeds to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only Borrower and/or the applicable Guarantor to Liens permitted by Section 6.01. All be used for repair or restoration of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each applicable Borrowing Base Property;
(eII) The current use if the Net Cash Proceeds are in an amount from $1,000,000 up to $4,000,000 and there is no Event of each Default that remains unwaived or uncured, the Administrative Agent shall permit such Net Cash Proceeds held by the Administrative Agent to be released to the Borrower or the applicable Guarantor to be used for repair or restoration but may condition such application upon the following conditions: (A) the restoration or repair will return the Borrowing Base Property complies in all material respects to substantially the same condition as existed prior to the casualty or condemnation, (B) the Net Cash Proceeds available therefrom (plus additional funds as may be required to be deposited by the Borrower with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent) will be sufficient to complete the required repair or restoration, and (C) the restoration or repair is capable of being completed by the date which is sixty (60) days prior to the then current Revolving Termination Date; and
(III) if the Net Cash Proceeds exceed $4,000,000, the Administrative Agent may permit insurance or condemnation proceeds held by the Administrative Agent to be released to the Borrower or the applicable Guarantor to be used for repair or restoration (provided, that if the Administrative Agent has elected not to release such proceeds to the Borrower, then 100% of the Net Cash Proceeds shall be applied as a principal prepayment of the Loans (or shall Cash Collateralize the Letter of Credit Liabilities or Specified Derivatives Obligations, as applicable) in the manner set forth in clause (viii) below) upon the following conditions: (A) the deposit with the Administrative Agent of such additional funds which the Administrative Agent determines are needed to pay all costs of the repair or restoration (including, without limitation, taxes, financing charges, insurance and rent rolls delivered during the repair period); (B) the establishment of an arrangement for lien releases and disbursement of funds acceptable to the Administrative Agent (the arrangement contained in this Agreement for disbursing Revolving Loan funds shall be deemed reasonable with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effectdisbursement of Net Cash Proceeds); (iiC) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered delivery to the Administrative Agent are trueof plans and specifications for the work, correct and complete in all material respects and have not been modified (or further modified); (iv) a contract for the work signed by a contractor reasonably acceptable to the knowledge Administrative Agent and a cost breakdown for the work, all of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could which shall be reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except acceptable to the Administrative Agent; (viiD) no tenant or other party has an option or right the delivery to the Administrative Agent of first refusal evidence acceptable to purchase the Administrative Agent in its reasonable determination (aa) that after completion of the work the income from the Borrowing Base Property will be sufficient to pay all or any portion expenses of any the Borrowing Base Property; (viiibb) no tenant has of the right to terminate any Lease continuation of Leases or execution of new Leases for not less than seventy percent (70%) of the net rentable area covered by Leases immediately prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ixcc) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No that upon completion of the work, the size, capacity and total value of the Borrowing Base Property will be at least as great as it was before the damage or condemnation occurred, and (E) there is no Event of Default that remains unwaived or uncured. The Borrower hereby acknowledges that the subject conditions described above are reasonable, and, if such conditions have not been satisfied within one hundred fifty (150) days of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which receipt by the Administrative Agent has not been notified of such insurance or condemnation proceeds, then Administrative Agent may apply such Net Cash Proceeds in writing; andaccordance with clause (viii) below.
(h2) Each Borrowing Base Property complies with The following (whether now existing or hereafter arising) are all absolutely and irrevocably assigned by the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed Borrower and each Guarantor to the Administrative Agent in writingand, no Exclusion Event with respect at the request of Administrative Agent, shall be paid directly to Administrative Agent: (i) all awards of damages and all other compensation payable directly or indirectly by reason of a condemnation or proposed condemnation for public or private use affecting all or any such part of, or any interest in, any Borrowing Base Property has occurredor Collateral; (ii) all proceeds of any insurance policies (whether or not expressly required by the Administrative Agent to be maintained by the Borrower or any Subsidiary, including, but not limited to, earthquake insurance and terrorism insurance, if any) payable by reason of loss sustained to all or any part of any Borrowing Base Property or Collateral; and (iii) all interest which may accrue on any of the foregoing. Subject to applicable law, the Administrative Agent may at its reasonable discretion apply all or any of the proceeds it receives to its expenses in settling, prosecuting or defending any claim and shall apply the remainder in accordance with clause (1) above. The Administrative Agent may commence, appear in, defend or prosecute any assigned claim or action and may adjust, compromise, settle and collect all claims and awards assigned to the Administrative Agent; provided, however, in no event shall the Administrative Agent be responsible for any failure to collect any claim or award unless caused by the malfeasance or nonfeasance by Administrative Agent or its employees or agents.
Appears in 3 contracts
Sources: First Lien Credit Agreement (Pennsylvania Real Estate Investment Trust), First Lien Credit Agreement (Pennsylvania Real Estate Investment Trust), First Lien Credit Agreement (Pennsylvania Real Estate Investment Trust)
Borrowing Base Properties. To each Borrower’s knowledge and except (ia) as disclosed in Each of the Real Property Information delivered to Administrative AgentPledging Subsidiaries, the LLC, and (ii) where the failure of any each of the following Partnerships has good and indefeasible title to be true all its Borrowing Base Properties which are Hydrocarbon Interests and correct would not constitute a Material Adverse Effect or result in a Material Property Event with good title to all its Borrowing Base Properties which are personal property, free and clear of Liens (other than Permitted Liens). With respect to any the Borrowing Base Property:Properties set forth on SCHEDULE -------- 5.1
(a) Each Borrowing Base Property Owner has good record after giving full effect to the Permitted Liens, the net revenue ------ interest is no less than that designated for the Pledging Subsidiaries, the LLC, and marketable title the Partnerships in fee simple to all Borrowing Base Properties necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect and to such Borrowing Base Property. Each applicable Properties and the working interest is no greater than as set forth for the Pledging Subsidiaries, the LLC, and the Partnerships in and to such Borrowing Base Property Owner has good record Properties, and marketable fee simple title there are no "back-in" or "reversionary" interests held by third parties which could reduce the net revenue interest or increase the working interest of the Pledging Subsidiaries, the LLC, or the Partnerships in such Borrowing Base Properties except as expressly set forth in SCHEDULE 5.1(a). All ▇▇▇▇▇ drilled and ---------------- Hydrocarbons produced with respect to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid Properties were drilled and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not produced in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinancesGovernmental Rules. All of the Borrowing Base Properties described in SCHEDULE -------- 5.1(a), regulationsare covered by the Initial Reserve Report and other reports which ------ Borrower has previously delivered to and which have been relied upon by Agent ------ and Lenders in connection with this Agreement and are covered by Mortgages or are owned by (i) Partnerships in which the Pledging Subsidiaries have granted security interests to Agent pursuant to a Partnership Pledge Agreement or (ii) by LLC in which A&W has granted a security interest to Agent pursuant to the LLC Pledge Agreement. No bills are past due and do not give rise to a Lien (other than Liens arising in the ordinary course of business for sums which are not yet due and payable under customary agreements or arising by operation of law) and taxes have been paid with respect to the Borrowing Base Properties other than those which are the subject of a bona fide dispute which is being contested in good faith by the Pledging Subsidiaries, the LLC, or the Partnerships by appropriate proceedings as to which a reserve is established in an amount that is satisfactory to Agent (and if a Lien secures the same or may secure the same, such Lien is subject to a Permitted Protest).
(b) All of the marketing arrangements of the Pledging Subsidiaries, the LLC, and restrictive covenants affecting such the Partnerships with respect to the Borrowing Base PropertyProperties are valid, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid enforceable and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each . As of the Leases date of this Agreement and thereafter through the Closing Date there do not exist any cumulative imbalances in gas production or receipt of "take or pay" payments except as disclosed as to both existence and extent on SCHEDULE 5.26(b) attached hereto. -----------------
(if anyc) delivered to the Administrative Agent are true, correct and complete in all material respects and have There has not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under Material Adverse Change in any of the Leases by any party (including any guarantor) thereto that, individually or in Borrowing Base Properties since the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any date of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event with respect to any such Borrowing Base Property has occurredmost recent Reserve Report.
Appears in 1 contract
Borrowing Base Properties. To each Borrower11.1.1 At all times, the Borrower shall maintain the Borrowing Base Properties in accordance with this Article 11 and the other terms and conditions of the Loan Documents.
11.1.2 In addition to the other requirements that are set forth in the definition of “Borrowing Base Property,” in order for a Real Property to qualify as a Borrowing Base Property, it shall comply with the following conditions at all times:
(a) Such Borrowing Base Property shall be wholly owned by a Borrower that complies with the covenants and provisions of this Agreement relating to Borrowers; provided, however, that a Borrowing Base Property may, with Administrative Agent’s knowledge written consent, be leased to a Borrower under an Approved Ground Lease;
(b) The representations and except warranties contained in Article 3 with respect to Borrowing Base Properties shall at all times be true and correct with respect to such Borrowing Base Property and such Borrowing Base Property shall be in compliance with the covenants set forth in Section 11.1;
(c) Such Borrowing Base Property shall be an income producing, multi-family, mixed-use, retail, distribution, parking, flex, industrial or office property, provided that parking facilities shall be permitted only if operated by a third-party operator and distribution facilities shall be permitted only to the extent they meet the conditions set forth in clause (e) of this Section 11.1.2;
(d) At least eighty percent (80%) of the (x) units in any multi-family Borrowing Base Property, and (y) net rentable square footage of any other type of Borrowing Base Property (other than a parking facility), shall be subject to executed Leases from tenants in occupancy who are not in default beyond the expiration of all applicable notice and grace periods under their Lease and not in bankruptcy (the “Occupancy Rate”); provided, however, that if (A) on any date, the Occupancy Rate is less than eighty percent (80%), there shall be a grace period of two (2) fiscal quarters to increase such occupancy provided that (i) as disclosed in Borrower delivers written notice of the Real Property Information delivered failure to Administrative Agentcomply with such occupancy requirement within three (3) Business Days after a Responsible Officer of Borrower obtains knowledge of such failure, and (ii) at all times during such grace period, the Occupancy Rate does not fall below seventy percent (70%) at any time and (B) on any date, the Occupancy Rate is less than seventy percent (70%), there shall be a grace period of two (2) fiscal quarters (which shall be concurrent with and not in addition to the two (2) fiscal quarter grace period referred to in clause (A), above) to increase such occupancy provided that (i) Borrower delivers written notice of the failure to comply with such occupancy requirement within three (3) Business Days after a Responsible Officer of Borrower obtains knowledge of such failure, (ii) at all times during such grace period, the Occupancy Rate does not fall below fifty percent (50%) at any time, and (iii) during the pendency of such grace period, the percentage applicable in calculating the Value-Based Borrowing Base Limit for the applicable Borrowing Base Property shall be reduced by fifty percent (50%); thereafter, and in the event any Borrowing Base Property has an Occupancy Rate below fifty percent (50%) at any time, such Borrowing Base Property shall be removed from the Borrowing Base pursuant to Section 11.3.2;
(e) If such Borrowing Base Property is a distribution facility, it shall be an Investment Grade Borrowing Base Property having at least eight (8) years remaining on the term of the Lease to the applicable Investment Grade Tenant at the time such facility is added to the Borrowing Base (excluding any extension options) and where the failure applicable Investment Grade Tenant shall be in occupancy, not in default beyond the expiration of all applicable notice and grace periods under its Lease and not in bankruptcy;
(f) If such Borrowing Base Property is a Single Tenant Asset, then the remaining Lease term related thereto shall be no less than six (6) years (excluding any extension options);
(g) An Appraisal shall be required for each Borrowing Base Property during the term of this Agreement as follows: (A) within six (6) months prior to the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event Effective Date (with respect to each initial Borrowing Base Property that is added to the Borrowing Base upon the Effective Date, and (B) within six (6) months prior to the date that any Borrowing Base Property:Property is added to the Borrowing Base in accordance with the Loan Documents (which respect to Borrowing Base Properties added after the Effective Date), and that in each case that is acceptable to Administrative Agent in its reasonable discretion, subject to the provisions of Sections 11.1.2(h);
(ah) Each For purposes of determining the Appraised Value of any Borrowing Base Property Owner has good record and marketable title hereunder, the most recent Appraisal thereof obtained by in fee simple accordance with the terms hereof shall govern the determination of the Appraised Value thereof; provided, however that if a new Appraisal is not required to all be obtained for such Borrowing Base Properties necessary Property pursuant to Section 11.1.2 until such time as the new Appraisal shall have been obtained in accordance with this Agreement, then the Borrowing Base Asset Value of such Borrowing Base Property shall equal the lesser of the Acquisition Cost of such Borrowing Base Property or used in the ordinary conduct of its business, except Estimated Value thereof.
(i) The survey for such defects Borrowing Base Property delivered to the Administrative Agent in title as could not, individually connection with this Agreement shall be prepared in accordance with the 2011 Minimum Standard Detail Requirements for ALTA/ASM Land Title Surveys. Except for those matters reflected on such survey or in the aggregatetitle policy for such Borrowing Base Property delivered to the Administrative Agent in connection with this Agreement or as otherwise disclosed to the Administrative Agent, as of the date such Real Property is accepted as a Borrowing Base Property, there shall not be any construction or commencement of construction on such Borrowing Base Property of any new external structures, or additions or extensions thereto, or other external improvements, whether to existing structures or not. Except as may be disclosed on the surveys delivered pursuant to this Agreement and in the title policy for such Borrowing Base Property: (i) none of the material improvements comprising part of such Borrowing Base Property shall be outside the boundaries of such Borrowing Base Property (or building restriction or setback lines applicable thereto); (ii) no material improvements on adjoining properties shall encroach upon such Borrowing Base Property; and (iii) no material improvements comprising part of such Borrowing Base Property shall encroach upon or violate any easements or any other encumbrance upon such Borrowing Base Property, in each case other than minor encumbrances which could not reasonably be expected to have a Material Adverse Effect (x) material adverse effect with respect to the financial condition or result the operations of such Borrowing Base Property, (y) material adverse effect on the Borrowing Base Asset Value of such Borrowing Base Property, or (z) material adverse effect on the ownership of such Borrowing Base Property.
(j) All transfer taxes, deed stamps, intangible taxes or other amounts in the nature of transfer taxes required to be paid by any Credit Party under applicable legal requirements currently in effect in connection with the transfer of such Borrowing Base Property to the Borrower, any transfer of a Material controlling interest in the Borrower or the formation of the REIT, as applicable, shall have been paid or will be paid prior to delinquency. All mortgage, mortgage recording, stamp, intangible or other similar tax required to be paid by any Credit Party under applicable legal requirements currently in effect in connection with the execution, delivery, recordation, filing, registration, perfection or enforcement of any of the Loan Documents, including, without limitation, the Mortgage, shall have been paid prior to delinquency.
(k) The Borrower shall have delivered to Administrative Agent copies of all Leases and all unrecorded easement agreements, reciprocal easement agreements, management agreements and material agreements in Borrower’s possession or custody which affect in any material respect the Borrower’s interest in such Borrowing Base Property.
(l) Borrower shall have received no notice of any condemnation proceeding involving such Borrowing Base Property Event or any portion thereof or parking facility used in connection therewith, nor shall any portion of such Borrowing Base Property or any parking facility used in connection therewith be damaged due to fire or other casualty, except those proceedings or casualties that could not reasonably be expected to materially interfere with the current use and value of such Borrowing Base Property or to cause such property to otherwise no longer qualify as a Borrowing Base Property.
(m) Such Borrowing Base Property shall have adequate rights of access to public ways and is currently served by adequate electric, gas, water, sewer, sanitary sewer and storm drain facilities. All public utilities necessary to the use and enjoyment of such Borrowing Base Property as intended to be used and enjoyed shall be located in the public right-of-way abutting such Borrowing Base Property or in private easements or license areas benefitting such Borrowing Base Property.
(n) No Credit Party shall have suffered, permitted or initiated the joint assessment of such Borrowing Base Property with any other real property constituting a tax lot separate and apart from the tax lot comprising such Borrowing Base Property.
(o) As of the date of its inclusion as a Borrowing Base Property, such Borrowing Base Property, including all buildings, improvements, parking facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection systems, electrical systems, equipment, elevators, exterior sidings and doors, landscaping, irrigation systems and all structural components, shall be in good condition, order and repair in all material respects subject to reasonable and customary wear and tear; and there shall exist no structural or other material defects or damages in such Borrowing Base Property, whether latent or otherwise, and no Credit Party shall have received written notice from any insurance company or bonding company of any defects or inadequacies in such Borrowing Base Property, or any part thereof, which would, in either case, adversely affect the insurability of the same or cause the imposition of extraordinary premiums or charges thereon or of any termination or threatened termination of any policy of insurance or bond.
(p) The Borrower shall have delivered to the Administrative Agent a true and correct copy of the Management Agreement that is in effect with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title The Management Agreement with respect to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject delivered to the Administrative Agent shall be the only Management Agreement related to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and shall be in full force and effect; effect with no default or event of default, in either case beyond all applicable notice and grace periods, existing thereunder.
(iiq) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to To the knowledge of any Credit PartyBorrower, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject shall have been purchased with proceeds of any pending or, to illegal activity and no part of the proceeds of any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified Extension will be used in writing; andconnection with any illegal activity.
(hr) Each The Borrowing Base Property complies with the conditions to must be included as a Borrowing Base Property under Section 2.23(d)(ii) andlocated in New York, except as previously disclosed to the Administrative Agent in writingConnecticut, no Exclusion Event New Jersey, Massachusetts, Rhode Island, Delaware, Maryland, Virginia, Pennsylvania, Vermont, New Hampshire and Maine.
11.1.3 The Borrower hereby covenants and agrees with respect to any such Borrowing Base Property has occurred.as follows:
Appears in 1 contract
Sources: Loan Agreement (GTJ REIT, Inc.)
Borrowing Base Properties. To each Borrower’s knowledge (a) The Eligible Real Estate and except Eligible Notes Receivable included in the calculation of the Borrowing Base Value shall at all times satisfy all of the following conditions:
(i) as disclosed in the Eligible Real Property Information delivered to Administrative Agent, and (ii) where the failure of any of the following to Estate shall be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property:
(a) Each Borrowing Base Property Owner has good record and marketable title owned 100% in fee simple or leased under a ground lease acceptable to all Borrowing Base Properties necessary or used Agent in its reasonable discretion by a Subsidiary Guarantor, and the ordinary conduct of its businessEligible Notes Receivable shall be owned 100% by a Subsidiary Guarantor, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof case free and clear of all Liens (other than the Liens permitted in §8.2(i) and (iv), and such Eligible Real Estate and Eligible Notes Receivable shall not have applicable to it any restriction on the sale, pledge, transfer, mortgage or assignment of such property (including any restrictions contained in any applicable organizational documents);
(ii) none of the Eligible Real Estate or the real estate subject to such Eligible Notes Receivable shall have any material title, survey, environmental, structural or other defects that would give rise to a materially adverse effect as to the value, use of or ability to sell or refinance such property;
(iii) The only asset of such Subsidiary shall be Eligible Real Estate or an Eligible Note Receivable included in the calculation of the Borrowing Base Value;
(iv) such Eligible Real Estate is self-managed by Section 6.01the Subsidiary Guarantor or is managed by an independent third party pursuant to a Management Agreement;
(v) with respect to Eligible Note Receivables, the outstanding principal balance of such Eligible Note Receivable shall not exceed seventy-five percent (75%) of the Appraised Value as most recently determined under this Agreement of the real property subject to such Eligible Note Receivable;
(vi) with respect to each Eligible Note Receivable, the underlying real estate would meet all of the requirements that apply to Eligible Real Estate being included within the calculation of the Borrowing Base Value if such property were owned by, rather than mortgaged to, the applicable Subsidiary Guarantor;
(vii) the term of each lease (without regard to extension options) at such Eligible Real Estate or real estate subject to an Eligible Note Receivable must exceed the then effective Maturity Date by not less than three (3) years; provided that with respect to (A) the lease with Elster Electric relating to the property commonly known as 2▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, North Carolina, which lease expires on October 31, 2010, and the lease to Yankee Candle relating to the property commonly known as 7▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, Massachusetts, which expires on June 30, 2010, such leases shall not be required to comply with the provisions of this clause (vii) until June 30, 2007, and (B) with respect to the lease to Work Flow Management relating to the property commonly known as H▇▇▇▇▇▇▇▇, such lease shall not be required to comply with the terms of this clause (vii);
(viii) each Eligible Real Estate or property subject to an Eligible Note Receivable shall be leased to a single tenant which is an Eligible Tenant, and each such tenant under a lease at such Eligible Real Estate or real estate subject to an Eligible Note Receivable must be in compliance with its payment obligations and material compliance with all other obligations under its lease, and not subject to any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation proceeding;
(ix) no Eligible Real Estate or real estate subject to Eligible Notes Receivable which are subject to a lease or leases to any single tenant or any Affiliate thereof shall account for more than twenty percent (20%) of the Borrowing Base Value (for the purposes hereof, tenants shall not be considered Affiliates of each other solely by virtue of having common ownership by an equity fund provided that their financial results are not consolidated with a common parent entity);
(x) such Eligible Real Estate or real estate which is subject to an Eligible Note Receivable shall not be vacant (for example, such tenant is no longer conducting business from such property); provided that at any one time not more than two (2) separate parcels of Eligible Real Estate or real estate which is subject to an Eligible Note Receivable included in the calculation of the Borrowing Base Value may be attributable to such real estate which is vacant provided that (1) the tenants therein are paying rent and not otherwise in default of their obligations under their lease, (2) during the period of such vacancy, such real estate shall be professionally managed by a firm pursuant to a Management Agreement approved in writing in advance by Agent, and (3) any such vacant property shall be reoccupied by such tenant or leased to a new tenant (such new tenant and its lease to be approved by Agent) within twelve (12) months of the date such property first became vacant); and
(xi) no more than fifteen percent (15%) of the Borrowing Base Value shall be attributable to Eligible Notes Receivable.
(b) Each In the event that all or any material portion of any Eligible Real Estate or any real property subject to an Eligible Note Receivable included in the calculation of the Borrowing Base Property complies Value shall be damaged in all any material respects with all Legal Requirementsrespect or taken by condemnation, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a then such property shall no longer be included in the calculation of the Borrowing Base PropertyValue unless and until (i) any damage to such real estate is repaired or restored, such real estate becomes fully operational and the Agent shall receive evidence satisfactory to the Agent of the value of such real estate following such repair or any userestoration (both at such time and prospectively) or (ii) Agent shall receive evidence satisfactory to the Agent that the value of such real estate (both at such time and prospectively) shall not be materially adversely affected by such damage or condemnation. In the event that such damage or condemnation only partially affects such Eligible Real Estate or real property subject to an Eligible Note Receivable included in the calculation of the Borrowing Base Value, activity, operation, then the Required Lenders may in good faith reduce the Borrowing Base Value attributable thereto based on such damage until such time as the Required Lenders receive evidence satisfactory to the Required Lenders that the value of such real estate (both at such time and prospectively) shall no longer be materially adversely affected by such damage or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;condemnation.
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed Upon any asset ceasing to do so), other than pursuant qualify to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a be included in the calculation of the Borrowing Base PropertyValue, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for such asset shall no longer be included in the use calculation of each the Borrowing Base Property and Value unless otherwise approved in writing by the operation thereof for their intended purpose are available at each Borrowing Base Property;
Required Lenders. Within five (e5) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions Business Days after becoming aware of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing such disqualification, the Borrower shall deliver to the Administrative AgentAgent a certificate reflecting such disqualification, together with the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each identity of the Leases (if any) delivered disqualified asset, a statement as to the Administrative Agent are true, correct and complete in all material respects and have not been modified (whether any Default or further modified); (iv) to the knowledge Event of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except Default arises as a result of counterparty breachsuch disqualification, casualty, condemnation or other customary basis and a calculation of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No the Borrowing Base Property is Value attributable to such asset. Simultaneously with the subject delivery of any pending orthe items required pursuant above, the Borrower shall deliver to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative the Agent has not been notified in writing; and
(h) Each an updated Borrowing Base Property complies Certificate demonstrating, after giving effect to such removal or disqualification, compliance with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent and covenants contained in writing, no Exclusion Event with respect to any such Borrowing Base Property has occurred§5.4 and §7.18.
Appears in 1 contract
Sources: Senior Secured Revolving Credit Agreement (Gladstone Commercial Corp)
Borrowing Base Properties. To each Borrower’s knowledge (a) At all times, the REIT and except Borrower shall maintain the Borrowing Base Properties in accordance with this Article IX and the other terms and conditions of the Loan Documents.
(b) In addition to the other requirements that are set forth in the definition of “Borrowing Base Property,” in order for a Real Property to qualify as a Borrowing Base Property, it shall comply with the following conditions at all times:
(i) Such Borrowing Base Property shall be wholly owned by a Subsidiary Guarantor (other than the Borrowing Base Property known as disclosed in 1▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, which shall be wholly owned by the Real 163 Washington SPE) that complies with the covenants and provisions of this Agreement relating to Subsidiary Guarantors and the 163 Entities; provided, however, that a Borrowing Base Property Information delivered to may, with Administrative Agent’s written consent, be leased to a Subsidiary Guarantor under an Approved Ground Lease;
(ii) The representations and warranties contained in Sections 3.05(a), 3.06(b), 3.22, and 3.23 shall at all times be true and correct with respect to such Borrowing Base Property and such Borrowing Base Property shall be in compliance with the covenants set forth in Section 9.01(c);
(iii) Such Borrowing Base Property shall be an income producing, multi-family, mixed-use, retail, distribution, parking or office property, provided that parking facilities shall be permitted only if operated by a third-party operator and distribution facilities shall be permitted only to the extent they meet the conditions set forth in clause (v) of this Section 9.01(b);
(iv) At least eighty percent (80%) of the (x) units in any multi-family Borrowing Base Property, and (y) net rentable square footage of any other type of Borrowing Base Property (other than a parking facility), shall be subject to executed Leases from tenants in occupancy who are not in default beyond the expiration of all applicable notice and grace periods under their Lease and not in bankruptcy (the “Occupancy Rate”); provided, however, that if (A) on any date, the Occupancy Rate is less than eighty percent (80%), there shall be a grace period of two (2) fiscal quarters to increase such occupancy provided that (i) Borrower delivers written notice of the failure to comply with such occupancy requirement within three (3) Business Days after a Responsible Officer of Borrower obtains knowledge of such failure, and (ii) at all times during such grace period, the Occupancy Rate does not fall below seventy percent (70%) at any time and (B) on any date, the Occupancy Rate is less than seventy percent (70%), there shall be a grace period of two (2) fiscal quarters (which shall be concurrent with and not in addition to the two (2) fiscal quarter grace period referred to in clause (A), above) to increase such occupancy provided that (i) Borrower delivers written notice of the failure to comply with such occupancy requirement within three (3) Business Days after a Responsible Officer of Borrower obtains knowledge of such failure, (ii) at all times during such grace period, the Occupancy Rate does not fall below fifty percent (50%) at any time, and (iii) during the pendency of such grace period, the percentage applicable in calculating the Value-Based Borrowing Base Limit for the applicable Borrowing Base Property shall be reduced by fifty percent (50%); thereafter, and in the event any Borrowing Base Property has an Occupancy Rate below fifty percent (50%) at any time, such Borrowing Base Property shall be removed from the Borrowing Base pursuant to Section 9.03;
(v) If such Borrowing Base Property is a distribution facility, it shall be an Investment Grade Borrowing Base Property having at least eight (8) years remaining on the term of the Lease to the applicable tenant at the time such facility is added to the Borrowing Base (excluding any extension options) and where the failure applicable tenant shall be in occupancy, not in default beyond the expiration of all applicable notice and grace periods under its Lease and not in bankruptcy;
(vi) If such Borrowing Base Property is a Single Tenant Asset, then the remaining Lease term related thereto shall be no less than six (6) years (excluding any extension options);
(vii) An Appraisal shall be required for each Borrowing Base Property during the term of this Agreement within six (6) months prior to the following date that any Borrowing Base Property is added to the Borrowing Base in accordance with the Loan Documents (which respect to Borrowing Base Properties added after the Original Closing Date), and that in each case that is acceptable to Administrative Agent in its reasonable discretion, subject to the provisions of Sections 9.01(b)(viii) and (ix);
(viii) Notwithstanding anything to the contrary in clause (vii) above, in Administrative Agent’s sole discretion, a new Appraisal may be true and correct would not constitute a Material Adverse Effect or result in a Material required, at Borrower’s expense, for each Borrowing Base Property Event commencing (i) August 20, 2015 (with respect to each initial Borrowing Base Property that is added to the Borrowing Base upon the Original Closing Date), (ii) twenty four (24) months after the date that any Borrowing Base Property is thereafter added to the Borrowing Base (with respect to any such subsequently-added Borrowing Base Property:), and (iii) twenty four (24) months after the date of any Appraisal obtained pursuant to this Section 9.01(viii). Borrower may, at its election and expense, also request a new Appraisal at any of such times. For purposes of this Section 9.01(b)(viii), an Appraisal that has a date of value that is no earlier than six (6) months prior to the end of any applicable 24-month period described in this Section 9.01(b)(viii) shall, if it is approved by Administrative Agent and complies with the requirements of this Agreement, be deemed to satisfy the requirements herein for a new Appraisal to be obtained commencing on each such 24-month period.
(aix) Each If the Net Operating Income for any Borrowing Base Property Owner has good record shall decrease (A) by more than five percent (5%) from one fiscal quarter to the next and marketable title the Net Operating Income of such Borrowing Base Property for the next succeeding fiscal quarter does not make up for such decline in fee simple Net Operating Income or (B) ten percent (10%) or more from the Net Operating Income of such Borrowing Base Property for the previous calendar year, then a new Appraisal for such Borrowing Base Property shall be required to be obtained at Borrower’s cost.
(x) For purposes of determining the Appraised Value of any Borrowing Base Property hereunder, the most recent Appraisal thereof obtained by in accordance with the terms hereof shall govern the determination of the Appraised Value thereof; provided, however that if a new Appraisal is not required to be obtained for such Borrowing Base Property pursuant to Section 9.01(b)(viii) or (ix), until such time as the new Appraisal shall have been obtained in accordance with this Agreement, then the Borrowing Base Asset Value of such Borrowing Base Property shall equal the lesser of the Acquisition Cost of such Borrowing Base Property or the Estimated Value thereof.
(xi) Borrower may elect, pursuant to the definition of “Borrowing Base Asset Value,” to require the determination of the component of the definition of Borrowing Base Asset Value referenced in clause (b) of the definition thereof to be based upon the Estimated Values of the Borrowing Base Properties or the Appraised Values of the Borrowing Base Properties only once per fiscal quarter, in connection with the delivery by Borrower to Administrative Agent of the Borrowing Base Certificate that is due to be delivered during such fiscal quarter, and such election shall be made on an “all or none” basis such that, if Borrower elects to require such determination to be based on Appraised Values, such election must be made as to all Borrowing Base Properties, and if Borrower elects to require such determination to be based on Estimated Values, such election must be made as to all Borrowing Base Properties necessary or used (provided, however, that in the ordinary conduct event that Borrower obtains an updated Appraisal pursuant to Section 9.01(b)(viii) Borrower shall be permitted to required that such determination be made on the basis of its businesssuch updated Appraised Value); provided, except further, that if the Appraised Value of one or more Borrowing Base Properties cannot be calculated solely because Appraisals have been ordered but have not yet been delivered for such defects Borrowing Base Property, as required hereby, the Borrowing Base Appraised Value may nonetheless be determined according to the Estimated Value of each such affected Borrowing Base Property and the Appraised Value of all other Borrowing Base Properties until such time as an Appraisal for such affected Borrowing Base Property has been obtained as provided herein.
(xii) The survey for such Borrowing Base Property delivered to the Administrative Agent in title as could not, individually connection with this Agreement shall be prepared in accordance with the 2011 Minimum Standard Detail Requirements for ALTA/ASM Land Title Surveys. Except for those matters reflected on such survey or in the aggregatetitle policy for such Borrowing Base Property delivered to the Administrative Agent in connection with this Agreement or as otherwise disclosed to the Administrative Agent, as of the date such Real Property is accepted as a Borrowing Base Property, there shall not be any construction or commencement of construction on such Borrowing Base Property of any new external structures, or additions or extensions thereto, or other external improvements, whether to existing structures or not. Except as may be disclosed on the surveys delivered pursuant to this Agreement and in the title policy for such Borrowing Base Property: (i) none of the material improvements comprising part of such Borrowing Base Property shall be outside the boundaries of such Borrowing Base Property (or building restriction or setback lines applicable thereto); (ii) no material improvements on adjoining properties shall encroach upon such Borrowing Base Property; and (iii) no material improvements comprising part of such Borrowing Base Property shall encroach upon or violate any easements or any other encumbrance upon such Borrowing Base Property, in each case other than minor encumbrances which could not reasonably be expected to have a Material Adverse Effect (x) material adverse effect with respect to the financial condition or result the operations of such Borrowing Base Property, (y) material adverse effect on the Borrowing Base Asset Value of such Borrowing Base Property, or (z) material adverse effect on the ownership of such Borrowing Base Property.
(xiii) All transfer taxes, deed stamps, intangible taxes or other amounts in the nature of transfer taxes required to be paid by any Credit Party under applicable legal requirements currently in effect in connection with the transfer of such Borrowing Base Property to the Borrower, any transfer of a Material controlling interest in the Borrower or the formation of the REIT, as applicable, shall have been paid or will be paid prior to delinquency. All mortgage, mortgage recording, stamp, intangible or other similar tax required to be paid by any Credit Party under applicable legal requirements currently in effect in connection with the execution, delivery, recordation, filing, registration, perfection or enforcement of any of the Loan Documents, including, without limitation, the Mortgage, shall have been paid prior to delinquency.
(xiv) The Borrower shall have delivered to Administrative Agent copies of all Leases and all unrecorded easement agreements, reciprocal easement agreements, management agreements and material agreements in Borrower’s possession or custody which affect in any material respect the Borrower’s interest in such Borrowing Base Property.
(xv) Borrower shall have received no notice of any condemnation proceeding involving such Borrowing Base Property Event or any portion thereof or parking facility used in connection therewith, nor shall any portion of such Borrowing Base Property or any parking facility used in connection therewith be damaged due to fire or other casualty, except those proceedings or casualties that could not reasonably be expected to materially interfere with the current use and value of such Borrowing Base Property or to cause such property to otherwise no longer qualify as a Borrowing Base Property.
(xvi) Such Borrowing Base Property shall have adequate rights of access to public ways and is currently served by adequate electric, gas, water, sewer, sanitary sewer and storm drain facilities. All public utilities necessary to the use and enjoyment of such Borrowing Base Property as intended to be used and enjoyed shall be located in the public right-of-way abutting such Borrowing Base Property or in private easements or license areas benefitting such Borrowing Base Property.
(xvii) No Credit Party shall have suffered, permitted or initiated the joint assessment of such Borrowing Base Property with any other real property constituting a tax lot separate and apart from the tax lot comprising such Borrowing Base Property.
(xviii) As of the date of its inclusion as a Borrowing Base Property, such Borrowing Base Property, including all buildings, improvements, parking facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection systems, electrical systems, equipment, elevators, exterior sidings and doors, landscaping, irrigation systems and all structural components, shall be in good condition, order and repair in all material respects subject to reasonable and customary wear and tear; and there shall exist no structural or other material defects or damages in such Borrowing Base Property, whether latent or otherwise, and no Credit Party shall have received written notice from any insurance company or bonding company of any defects or inadequacies in such Borrowing Base Property, or any part thereof, which would, in either case, adversely affect the insurability of the same or cause the imposition of extraordinary premiums or charges thereon or of any termination or threatened termination of any policy of insurance or bond.
(xix) The Borrower shall have delivered to the Administrative Agent a true and correct copy of the Management Agreement that is in effect with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title The Management Agreement with respect to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject delivered to the Administrative Agent shall be the only Management Agreement related to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a such Borrowing Base Property, and shall be in full force and effect with no default or event of default, in either case beyond all applicable notice and grace periods, existing thereunder.
(xx) To the knowledge of Borrower, no portion of such Borrowing Base Property shall have been purchased with proceeds of any use, activity, operation, or maintenance thereof or thereon, is not illegal activity and no part of the proceeds of any Credit Extension will be used in compliance connection with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;illegal activity.
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property REIT and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, Borrower hereby covenant and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event agrees with respect to any such Borrowing Base Property has occurred.(i) to comply with Sections 5.05, 5.12, 5.18, 5.19, 5.21, 6.02, 6.11, and 6.18, and (ii) as follows:
Appears in 1 contract
Borrowing Base Properties. To each Borrower’s knowledge and except (i) as disclosed in the Real Property Information delivered to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property:
(a) Each Borrowing Base Property Owner of the Pledging Subsidiaries, the LLC, and each of the Partnerships has good record and marketable indefeasible title in fee simple to all its Borrowing Base Properties necessary or used which are Hydrocarbon Interests and good title to all its Borrowing Base Properties which are personal property, free and clear of Liens (other than Permitted Liens). With respect to the Borrowing Base Properties set forth on Schedule 5.1(a), after giving full effect to the Permitted Liens, the net revenue interest is no less than that designated for the Pledging Subsidiaries, the LLC, and the Partnerships in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect and to such Borrowing Base Property. Each applicable Properties and the working interest is no greater than as set forth for the Pledging Subsidiaries, the LLC, and the Partnerships in and to such Borrowing Base Property Owner has good record Properties, and marketable fee simple title there are no “back-in” or “reversionary” interests held by third parties which could reduce the net revenue interest or increase the working interest of the Pledging Subsidiaries, the LLC, or the Partnerships in such Borrowing Base Properties except as expressly set forth in Schedule 5.1(a). All ▇▇▇▇▇ drilled and Hydrocarbons produced with respect to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid Properties were drilled and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not produced in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinancesGovernmental Rules. All of the Borrowing Base Properties described in Schedule 5.1(a), regulationsare covered by the Initial Reserve Report and other reports which Borrower has previously delivered to and which have been relied upon by Agent and Lenders in connection with this Agreement and are covered by Mortgages or are owned by (i) Partnerships in which the Pledging Subsidiaries have granted security interests to Agent pursuant to a Partnership Pledge Agreement or (ii) by LLC in which A&W has granted a security interest to Agent pursuant to the LLC Pledge Agreement. No bills are past due and do not give rise to a Lien (other than Liens arising in the ordinary course of business for sums which are not yet due and payable under customary agreements or arising by operation of law) and taxes have been paid with respect to the Borrowing Base Properties other than those which are the subject of a bona fide dispute which is being contested in good faith by the Pledging Subsidiaries, the LLC, or the Partnerships by appropriate proceedings as to which a reserve is established in an amount that is satisfactory to Agent (and if a Lien secures the same or may secure the same, such Lien is subject to a Permitted Protest).
(b) All of the marketing arrangements of the Pledging Subsidiaries, the LLC, and restrictive covenants affecting such the Partnerships with respect to the Borrowing Base PropertyProperties are valid, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid enforceable and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each . As of the Leases date of this Agreement, there do not exist any cumulative imbalances in gas production or receipt of “take or pay” payments except as disclosed as to both existence and extent on Schedule 5.26(b) attached hereto.
(if anyc) delivered to the Administrative Agent are true, correct and complete in all material respects and have There has not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under Material Adverse Change in any of the Leases by any party (including any guarantor) thereto that, individually or in Borrowing Base Properties since the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any date of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event with respect to any such Borrowing Base Property has occurredmost recent Reserve Report.
Appears in 1 contract
Borrowing Base Properties. To each (a) As at the end of any fiscal quarter or any other date of measurement, the Borrower shall not permit Unsecured Consolidated Total Indebtedness (exclusive of Accounts Payable, but including amounts outstanding under any Loans and Letters of Credit after giving effect to Loan Requests) to equal or exceed 55% of the aggregate Borrowing Base Value, PROVIDED that in the event that Consolidated Total Indebtedness exceeds 60% of Consolidated Total Adjusted Asset Value at any time, the Borrower shall not permit the Unsecured Consolidated Total Indebtedness (exclusive of Accounts Payable, but including the outstanding principal amount of all Loans and the aggregate undrawn face amount of all outstanding Letters of Credit after giving effect to Loan Requests) to equal or exceed 50% of the aggregate Borrowing Base Value.
(b) Except for the Exception Property, not more than 15% of the Borrowing Base Value shall be derived from any single Borrowing Base Property. One Borrowing Base Property (the "Exception Property") (but not more than one property), which property can differ from time to time, as designated by Borrower’s knowledge and except ) can constitute up to 25% of the Borrowing Base Value, PROVIDED that the Exception Property (i) as disclosed in the Real Property Information delivered to Administrative Agentmust be CBD Property, and (ii) where may not be a hotel property.
(c) For purposes of determining the failure Borrowing Base Value for this Section 10.6, the Net Operating Income of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property:
(a) Each Property acquired during such prior fiscal quarter shall be adjusted on a pro-forma basis by projecting the Net Operating Income generated by each such acquired Borrowing Base Property Owner has good record and marketable title in fee simple to all Borrowing Base Properties necessary for the portion of the quarter during which it was owned or used in ground-leased by the ordinary conduct of its business, except for such defects in title as could not, individually or in Borrower over the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to entire quarter.
(d) Notwithstanding the Borrowing Base Property owned by such Conditions, in the event that the Borrower desires to include any Unencumbered Asset in the Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All that does not meet one or more of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issuedConditions, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens any such Unencumbered Asset shall only be permitted by Section 6.01).
(b) Each to be included in the Borrowing Base Property complies in all material respects with all Legal Requirementsthe event that (i) the Borrower has submitted to the Agent a compliance certificate in the form of EXHIBIT C-5, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a modified to reflect the non-conformity of the proposed Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are Majority Banks have provided the Borrower with written approval, in writingtheir sole discretion, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all for such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions non-conforming Unencumbered Asset to be included as in the Borrowing Base. Upon any such written approval by the Majority Banks, such Unencumbered Asset shall be considered a Borrowing Base Property under Section 2.23(d)(ii) andfor all purposes hereunder, except as previously disclosed to PROVIDED that on the Administrative Agent date of inclusion of any such Unencumbered Asset in writingthe Borrowing Base (and thereafter in accordance with the terms of this Agreement), no Exclusion Event such Unencumbered Asset is otherwise in compliance with the Borrowing Base Conditions other than with respect to any the non-conformity as certified by the Borrower and approved by the Majority Banks in the compliance certificate submitted by the Borrower under clause (i) of the preceding sentence, and PROVIDED, FURTHER that there is otherwise no Default or Event of Default existing upon the date of, or arising as a result of, the inclusion of such Unencumbered Asset in the Borrowing Base Property has occurredBase.
Appears in 1 contract
Borrowing Base Properties. To each Borrower’s knowledge and except (i) as disclosed in the Each Real Property Information delivered to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute listed on Schedule I fully qualifies as a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property. With respect to each Borrowing Base Property (including each Real Property which shall be added as a Borrowing Base Property in accordance with the terms hereof, whether upon the Effective Date or pursuant to Article X:
(a) Each Other than Permitted Encumbrances, there are no claims for payment for work, labor or materials affecting any Borrowing Base Property Owner has good record and marketable title in fee simple to all Borrowing Base Properties necessary which are or used in may become a Lien prior to, or of equal priority with, the ordinary conduct of its business, except for such defects in title as could not, individually or in Liens created by the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01)Loan Documents.
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirementbeing, and has no knowledge will continue to be, used exclusively for one or more of any the uses permitted pursuant to Section 10.1.2(iii) and in accordance with such noncompliance except as disclosed to Administrative AgentSection 10.1.2(iii), and other appurtenant and related uses;
(c) The Credit Parties have not directly or indirectly conveyedAll material certifications, assignedpermits, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Propertylicenses and approvals, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary without limitation, certificates of completion and occupancy permits, required for the use legal use, occupancy and operation of each Borrowing Base Property have been obtained and are in full force and effect. The Borrower shall (or cause the operation thereof for their intended purpose are available at each Borrowing Base Property;
(eapplicable Subsidiary to) keep and maintain all material certifications, permits, licenses and approvals, in full force and effect. The current use being made of each Borrowing Base Property complies is in all material respects conformity with all any applicable zoning ordinances, regulations, and restrictive covenants affecting certificate of occupancy issued for such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;.
(fd) Except (i) As of the Closing Date, and except as disclosed in writing any estoppel certificate delivered to the Administrative AgentLender, the rent rolls delivered pursuant to the Administrative Agent with respect thereof Section 4.1.4 are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent Lender are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be have a Material Property Event(a) material adverse effect with respect to the financial condition or the operations of such Borrowing Base Property, (b) material adverse effect on the Borrowing Base Asset Value of such Borrowing Base Property, (c) material adverse effect on the ownership of such Borrowing Base Property, or that would involve more than $1,000,000 or take longer than three (3) months to repair or remediate, and, as of the Effective Date, to the knowledge of any Credit Party, no material default exists under any of the Leases; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be have a Material Property Event(a) material adverse effect with respect to the financial condition or the operations of such Borrowing Base Property, (b) material adverse effect on the Borrowing Base Asset Value of such Borrowing Base Property, (c) material adverse effect on the ownership of such Borrowing Base Property, or that would involve more than $1,000,000 or take longer than three (3) months to repair or remediate; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative AgentLender; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security depositsdeposits and estimated payments of operating expenses, Taxes and other pass-throughs paid by tenants pursuant to their Leases not prepaid more than one month prior to the date such estimated payments are due or prepayments of rent made in the ordinary course of business);.
(ge) No portion of any Borrowing Base Property is located in a flood hazard area as designated by the subject of any pending Federal Emergency Management Agency or, if in a flood zone, flood insurance (or other flood casualty protection acceptable to the Lender) is maintained therefor in full compliance with the provisions hereof and all applicable Legal Requirements.
(f) None of the Borrowing Base Properties have been affected by any Credit Party’s knowledgefire, threatened condemnation explosion, accident, strike, lockout or other labor dispute, drought, storm, hail, earthquake, embargo, act of God or of the public enemy or other casualty (whether or not covered by insurance) that has not previously been repaired or that, either individually or in the aggregate, could reasonably be expected to have a (a) material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each effect with respect to the financial condition or the operations of such Borrowing Base Property complies with Property, (b) material adverse effect on the conditions to be included as a Borrowing Base Property under Asset Value of such Borrowing Base Property, or (c) material adverse effect on the ownership of such Borrowing Base Property, or that would involve more than $1,000,000 or take longer than three (3) months to repair or remediate. In the event that any of the representations or warranties set forth in this Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent 3.16 are inaccurate in writing, no Exclusion Event any material respect with respect to any Borrowing Base Property, it shall constitute a Default only in the event that Borrower, if required by the Lender, has not removed such Borrowing Base Property has occurredin accordance with Section 10.3 within ninety (90) days following delivery to the Borrower of written notice of such breach.
Appears in 1 contract
Sources: Loan Agreement (GTJ REIT, Inc.)
Borrowing Base Properties. To each Borrower’s knowledge and except (i) as disclosed in the Real Property Information delivered to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property:
(a) Each Borrowing Base Property Owner of the Pledging Subsidiaries, and each of the Partnerships has good record and marketable indefeasible title in fee simple to all its Borrowing Base Properties necessary or used which are Hydrocarbon Interests and good title to all its Borrowing Base Properties which are personal property, free and clear of Liens (other than Permitted Liens). With respect to the Borrowing Base Properties set forth on Schedule 5.1(a), ---------------- after giving full effect to the Permitted Liens, the net revenue interest is no less than that designated for the Pledging Subsidiaries, and the Partnerships in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect and to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record Properties and marketable fee simple title the working interest is no greater than as set forth for the Pledging Subsidiaries, and the Partnerships in and to the Borrowing Base Property owned by such Borrowing Base Property OwnerProperties, subject only to Liens permitted and there are no "back-in" or "reversionary" interests held by Section 6.01third parties which could reduce the net revenue interest or increase the working interest of the Pledging Subsidiaries, or the Partnerships in such Borrowing Base Properties except as expressly set forth in Schedule -------- 5.1
(a). All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid wells drilled and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes Hydrocarbon▇ ▇▇oduced with respect to a the ------ Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property Properties were drilled and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies produced in compliance in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Governmental Rules. All of the Borrowing Base PropertyProperties described in Schedule 5.1(a), all use restrictions of any Governmental Authority having jurisdiction are covered by the Initial Reserve --------------- Report and other reports which Borrower has previously delivered to and which have been satisfied;relied upon by Agent and Lenders in connection with this Agreement and are covered by Mortgages or are owned by Partnerships in which the Pledging Subsidiaries have granted security interests to Agent pursuant to a Partnership Pledge Agreement. No bills are past due and do not give rise to a Lien (other than Liens arising in the ordinary course of business for sums which are not yet due and payable under customary agreements or arising by operation of law) and taxes have been paid with respect to the Borrowing Base Properties other than those which are the subject of a bona fide dispute which is being contested in good faith by the Pledging Subsidiaries or the Partnerships by appropriate proceedings as to which a reserve is established in an amount that is satisfactory to Agent (and if a Lien secures the same or may secure the same, such Lien is subject to a Permitted Protest).
(fb) Except as disclosed in writing All of the marketing arrangements of the Pledging Subsidiaries and the Partnerships with respect to the Administrative AgentBorrowing Base Properties are valid, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid enforceable and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each . As of the Leases date of this Agreement and thereafter through the Closing Date there do not exist any cumulative imbalances in gas production or receipt of "take or pay" payments except as disclosed as to both existence and extent on Schedule 5.26(b)attached hereto. -----------------
(if anyc) delivered to the Administrative Agent are true, correct and complete in all material respects and have There has not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under Material Adverse Change in any of the Leases by any party (including any guarantor) thereto that, individually or in Borrowing Base Properties since the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any date of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event with respect to any such Borrowing Base Property has occurredmost recent Reserve Report.
Appears in 1 contract
Borrowing Base Properties. To (a) At all times, Borrower shall maintain the Borrowing Base Properties in accordance with this Article IX and the other terms and conditions of the Loan Documents.
(b) Borrower shall cause the Borrowing Base Properties to comply with the financial covenants in Section 6.01 at all times. In connection therewith, Borrower shall deliver to Administrative Agent not more than 60 days after each Borrower’s knowledge and except Quarterly Date, a Borrowing Base Certificate evidencing such compliance.
(c) Each Borrowing Base Property shall be subject to the following conditions:
(i) as disclosed Such Borrowing Base Property shall be an income producing, multi-family, retail, distribution, parking or office property, provided that in connection with distribution facilities and parking facilities, such Borrowing Base Property shall be subject to the single-tenant provisions of clause (iv) below and parking facilities shall be permitted only if operated by a third-party operator;
(ii) Such Borrowing Base Property shall have executed leases from tenants in occupancy who are not in default under their lease and not in bankruptcy covering at least seventy-five percent (75%) of the net rentable square footage of such Borrowing Base Property;
(iii) If such Borrowing Base Property is a distribution facility, it is an Investment Grade Borrowing Base Property having at least eight (8) years remaining on the term of such lease (excluding any extension options) and where the applicable Investment Grade Tenant is in occupancy, not in default under its lease and not in bankruptcy;
(A) The aggregate Borrowing Base Properties having a single tenant shall not comprise more than (1) thirty percent (30%) of the Borrowing Base if such Borrowing Base Property is not an Investment Grade Borrowing Base Property or (2) fifty percent (50%) of the if such Borrowing Base Property is an Investment Grade Borrowing Base Property; or (B) no Borrowing Base Property having a single tenant shall be subject to executed leases with a remaining lease term of fewer than six (6) years (excluding any extension options);
(v) The Net Operating Income generated from any single tenant at any Borrowing Base Property shall not account for more than twenty percent (20%) of the Borrowing Base;
(vi) Each Borrowing Base Property must be in the Real Property Information delivered to New York Metropolitan Statistical Area;
(vii) Unless Administrative Agent, in its sole and absolute discretion, shall agree otherwise, no single Borrowing Base Property shall compromise more than (iiA) where the failure of any 30% of the following Borrowing Base at such time as the total Commitments are equal to or less than $40,000,000, (B) 20% of the Borrowing Base at such time as the total Commitments are less than $100,000,000 but greater than $40,000,000 or (C) 15% of the Borrowing Base at such time as the total Commitments are equal to or greater than $100,000,000;
(viii) No Borrowing Base Property that is subject to an Approved Ground Lease shall compromise more than thirty percent (30%) of the aggregate Net Operating Income of all Borrowing Base Properties;
(ix) A minimum of thirty percent (30%) of all Borrowing Base Properties must be located in New York County, New York State;
(x) An Appraisal shall be required for each Borrowing Base Property during the term of the Loan, provided that any Appraisal obtained by Borrower within six (6) months prior to the Effective Date (or within six (6) months of the date any Borrowing Base Property is proposed to be true added to the Borrowing Base in accordance with the Loan Documents) and correct would not constitute that is acceptable to Administrative Agent in its reasonable discretion shall satisfy the requirements of this clause (x); and
(xi) If the Net Operating Income for any Borrowing Base Property shall decrease by ten percent (10%) or more from the Net Operating Income determined in connection with the most recently delivered financial information, and within six (6) months of such disclosure, Borrower has failed to remedy such failure such that the Net Operating Income is no longer ten percent (10%) or more below such prior determination, then a Material Adverse Effect or result in a Material new Appraisal for such Borrowing Base Property Event shall be required to be obtained at Borrower’s cost.
(d) Borrower hereby covenants and agrees with respect to any Borrowing Base PropertyProperty as follows:
(a) Each Borrowing Base Property Owner has good record and marketable title in fee simple to all Borrowing Base Properties necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event with respect to any such Borrowing Base Property has occurred.
Appears in 1 contract
Sources: Credit Agreement (American Realty Capital New York Recovery Reit Inc)
Borrowing Base Properties. To each Borrower’s knowledge (1) Subject to the first sentence of Section 2.10(b), above, and except (i) as disclosed in Section 2.10(b)(x), below, with respect to any Net Cash Proceeds realized or received with respect to any Insurance and Condemnation Event at a Borrowing Base Property, the Real Property Information delivered Net Cash Proceeds shall at the request of Administrative Agent, be paid directly to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Propertyprovided that:
(aI) Each Borrowing Base Property Owner has good record if the Net Cash Proceeds are less than $1,000,000 and marketable title in fee simple to all Borrowing Base Properties necessary there is no Event of Default that remains unwaived or used in uncured, the ordinary conduct of its business, except for Administrative Agent shall release such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title Net Cash Proceeds to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only Borrower and/or the applicable Guarantor to Liens permitted by Section 6.01. All be used for repair or restoration of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each applicable Borrowing Base Property;
(eII) The current use if the Net Cash Proceeds are in an amount from $1,000,000 up to $4,000,000 and there is no Event of each Default that remains unwaived or uncured, the Administrative Agent shall permit such Net Cash Proceeds held by the Administrative Agent to be released to the Borrower or the applicable Guarantor to be used for repair or restoration but may condition such application upon the following conditions: (A) the restoration or repair will return the Borrowing Base Property complies in all material respects to substantially the same condition as existed prior to the casualty or condemnation, (B) the Net Cash Proceeds available therefrom (plus additional funds as may be required to be deposited by the Borrower with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent) will be sufficient to complete the required repair or restoration, and (C) the restoration or repair is capable of being completed by the date which is sixty (60) days prior to the then current Term Loan Maturity Date; and (III) if the Net Cash Proceeds exceed $4,000,000, the Administrative Agent may permit insurance or condemnation proceeds held by the Administrative Agent to be released to the Borrower or the applicable Guarantor to be used for repair or restoration (provided, that if the Administrative Agent has elected not to release such proceeds to the Borrower, then 100% of the Net Cash Proceeds shall be applied as a principal prepayment of the Loans in the manner set forth in clause (viii) below) upon the following conditions: (A) the deposit with the Administrative Agent of such additional funds which the Administrative Agent determines are needed to pay all costs of the repair or restoration (including, without limitation, taxes, financing charges, insurance and rent rolls delivered during the repair period); (B) the establishment of an arrangement for lien releases and disbursement of funds acceptable to the Administrative Agent (the arrangement contained in this Agreement for disbursing Loan funds shall be deemed reasonable with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effectdisbursement of Net Cash Proceeds); (iiC) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered delivery to the Administrative Agent are trueof plans and specifications for the work, correct and complete in all material respects and have not been modified (or further modified); (iv) a contract for the work signed by a contractor reasonably acceptable to the knowledge Administrative Agent and a cost breakdown for the work, all of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could which shall be reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except acceptable to the Administrative Agent; (viiD) no tenant or other party has an option or right the delivery to the Administrative Agent of first refusal evidence acceptable to purchase the Administrative Agent in its reasonable determination (aa) that after completion of the work the income from the Borrowing Base Property will be sufficient to pay all or any portion expenses of any the Borrowing Base Property; (viiibb) no tenant has of the right to terminate any Lease continuation of Leases or execution of new Leases for not less than seventy percent (70%) of the net rentable area covered by Leases immediately prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ixcc) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No that upon completion of the work, the size, capacity and total value of the Borrowing Base Property will be at least as great as it was before the damage or condemnation occurred, and (E) there is no Event of Default that remains unwaived or uncured. The Borrower hereby acknowledges that the subject conditions described above are reasonable, and, if such conditions have not been satisfied within one hundred fifty (150) days of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which receipt by the Administrative Agent has not been notified of such insurance or condemnation proceeds, then Administrative Agent may apply such Net Cash Proceeds in writing; andaccordance with clause (viii) below.
(h2) Each Borrowing Base Property complies with The following (whether now existing or hereafter arising) are all absolutely and irrevocably assigned by the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed Borrower and each Guarantor to the Administrative Agent in writingand, no Exclusion Event with respect at the request of Administrative Agent, shall be paid directly to Administrative Agent: (i) all awards of damages and all other compensation payable directly or indirectly by reason of a condemnation or proposed condemnation for public or private use affecting all or any such part of, or any interest in, any Borrowing Base Property has occurred.or Collateral; (ii) all proceeds of any insurance policies (whether or not expressly required by the Administrative Agent to be maintained by the Borrower or any Subsidiary, including, but not limited to, earthquake insurance and terrorism insurance, if any) payable by reason of loss sustained to all or any part of any Borrowing Base Property or Collateral; and (iii) all interest which may accrue on any of the
Appears in 1 contract
Sources: Second Lien Credit Agreement (Pennsylvania Real Estate Investment Trust)
Borrowing Base Properties. To each Borrower’s knowledge and except (i) as disclosed in the Real Property Information delivered to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property:
(a) Each Borrowing Base Property Owner has good record and marketable title in fee simple to shall at all Borrowing Base Properties necessary or used in times satisfy the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a following criteria: (i) Borrower or a Wholly Owned wholly-owned Subsidiary thereof of the Borrower holds good title (by fee or pursuant to a Qualified Ground Lease) to such Property, free and clear of all Liens (except for Permitted Borrowing Base Liens); (ii) such Property is leased to an Operating Lessee; (iii) such Property is designated a full-service property (in accordance with industry standard, as reasonably determined by Administrative Agent); (iv) such Property shall at all times be an upper-upscale, luxury or better quality hotel, as designated by ▇▇▇▇▇ Travel Research (or a similar successor company designated by Administrative Agent); (v) such Property is operated under a nationally recognized brand (or with respect to a foreign Property, an internationally recognized brand) by an Approved Manager; (vi) such Property is fully operating, open to the public and not under development or redevelopment (except for routine, ordinary course renovation, maintenance and repair that does not result in the closure of more than twenty-five percent (25%) of the rooms at such hotel); provided, however, that temporary closure due to force majeure events, not to exceed fifteen (15) Business Days, as well as ordinary course seasonal closures, shall be permitted; (vii) such Property is not subject to or encumbered by any Indebtedness other than Liens permitted Permitted Borrowing Base Debt; (viii) such Property is free of material structural defects or material environmental issues and not subject to any material condemnation proceedings; (ix) neither such Property nor the Property Owner thereof is encumbered with Permitted Borrowing Base Debt or any other Material Agreement that by Section 6.01)its terms precludes the grant of the Collateral, the exercise by or on behalf of the Secured Creditors of remedies with respect to the Collateral or in any way impairs the validity or the enforceability of the Security Documents; and (x) the Property Owner of such Property is Borrower or a Subsidiary Guarantor.
(bi) Each The Borrowing Base must at all times include a minimum of at least five (5) Borrowing Base Properties; (ii) no Borrowing Base Property complies and no Capital Stock in all material respects with all Legal Requirementsany Borrowing Base Ownership Entity shall at any time be subject to or encumbered by (A) any Indebtedness other than Permitted Borrowing Base Debt, including all subdivision or (B) any Lien other than a Permitted Borrowing Base Lien; and platting requirements(iii) each Borrowing Base Property shall be located in the United States, provided that one (1) Borrowing Base Property may be located in Canada. Notwithstanding the foregoing subclause (b)(i), Borrower shall be entitled to reduce the Borrowing Base to a minimum of four (4) Borrowing Base Properties, provided that the calculation of the Available Commitment shall be modified as provided in the definition thereof.
(c) Borrower may propose to include additional Properties (whether New Acquisitions or former Development Properties, or Properties that were once Borrowing Base Properties but ceased to qualify as such) by sending a written proposal for inclusion to Administrative Agent. Administrative Agent may reasonably request any diligence materials and documentation it deems necessary to evaluate such Property, including, without reliance on limitation, certifications, appraisals, UCC, title, lien and judgment searches, and title documentation, management or franchise agreements and other material agreements. Administrative Agent will make such request and materials available to the Lenders. The inclusion of any adjoining Property (other than the Initial Borrowing Base Properties) as a Borrowing Base Property shall be subject to (i) delivery of the foregoing diligence materials, and (ii) Borrower’s certification and Administrative Agent’s reasonable approval that such Property meets the criteria set forth in clause (a) above and the inclusion thereof complies with clause (b) above. Administrative Agent shall be given at least ten (10) Business Days to evaluate any diligence materials and Borrower’s certification.
(d) As a further condition to the inclusion of a Property as a Borrowing Base Property, (i) Borrower, Guarantor or neighboring property. No Credit Party any Subsidiary that directly owns the Capital Stock of a Subsidiary that directly or indirectly owns or leases such Property shall execute and deliver to the Administrative Agent a supplement to the Pledge Agreement for the purposes of becoming a pledgor thereunder with respect to the Capital Stock of such Borrowing Base Ownership Entity (provided such Subsidiary is not already a party to the Pledge Agreement) and shall, pursuant to (and to the extent required by) the Pledge Agreement, pledge to the Administrative Agent all of the outstanding shares of Capital Stock of such Subsidiary and deliver undated stock powers for such certificates, executed in blank (or, if any such shares of capital stock are uncertificated, confirmation and evidence reasonably satisfactory to the Administrative Agent that the security interest in such uncertificated securities has received been transferred to and perfected by the Administrative Agent, for the benefit of the Lenders, in accordance with Article 8 of the UCC or any written notice other similar law which may be applicable) and (ii) any Subsidiary that directly owns the Capital Stock of a Subsidiary that directly or written claim from indirectly owns or leases such Property shall, unless already a party to the Subsidiary Guaranty, execute a Joinder to become party to the Subsidiary Guaranty, substantially in the form attached as Exhibit H-2 hereto.
(e) Borrower shall promptly, after any Person that Responsible Officer of the Borrower obtains knowledge thereof, notify Administrative Agent of: (i) any material structural defects or Environmental Occurrence affecting a Borrowing Base Property or (ii) the occurrence of any casualty event affecting a Borrowing Base Property, or (iii) any use, activity, operation, other event or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to occurrence which would cause a Borrowing Base PropertyProperty to cease to satisfy each of the conditions and requirements set forth in clause (a) above. In such event, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each affected Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinanceswill immediately, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered occurrence, cease to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included qualify as a Borrowing Base Property under Section 2.23(d)(ii) andhereunder, except as previously disclosed to the extent provided in the following sentence. In the event that structural defects, Environmental Occurrence or casualty result in the temporary closure (for repair, restoration or remediation) of less than 25% of the rooms in such hotel and provided that the Borrower or the applicable Property Owner has given reasonable security to the Administrative Agent to insure that the repair, restoration or remediation thereof will be promptly and diligently resolved in writinga good and ▇▇▇▇▇▇▇-like manner within no more than sixty (60) days from occurrence, then such Property will not cease to qualify as a Borrowing Base Property for so long as such conditions remain satisfied and provided that such issues are finally repaired or resolved within sixty (60) days.
(f) Borrower may elect, on no less than fifteen (15) days prior written notice (a “Property Release Notice”) to Administrative Agent, to remove a Borrowing Base Property from the Borrowing Base, whether as a result of an intended Disposition or otherwise, provided that:
(i) The Property Release Notice sets forth the Business Day (the “Release Date”) on which Borrower desires that Administrative Agent release the Property from the Borrowing Base Property and, if applicable, whether Borrower elects to terminate the Pledge and Subsidiary Guaranty with respect to the Borrowing Base Ownership Entities that hold interests in such Property, to the extent applicable with respect thereto;
(ii) Borrower shall submit to Administrative Agent not less than ten (10) days prior to the Release Date a release of Liens (and related Loan Documents) for the applicable Borrowing Base Ownership Entity (for execution by Administrative Agent) in a form appropriate in the applicable state and otherwise satisfactory to Administrative Agent in its reasonable discretion (collectively, “Release Instruments”) for each applicable Borrowing Base Ownership Entity together with an Officer’s Certificate certifying that (A) the Release Instruments are in compliance with all Legal Requirements, (B) the release to be effected will not violate the terms of this Agreement, (C) the release to be effected will not impair or otherwise adversely affect the Liens, security interests and other rights of Administrative Agent and Lenders under the Subsidiary Guaranty and Pledge with respect to Borrowing Base Ownership Entities not being released (or as to the Borrowing Base Properties subject to Loan Documents not being released) and (D) the condition described in paragraph (iii) below is satisfied in connection with such Borrowing Base Property Release (together with calculations and supporting documentation demonstrating the same in reasonable detail);
(iii) After giving effect to such Borrowing Base Property Release, the Aggregate Outstanding Balance shall not exceed the Available Commitment calculated on a pro forma basis;
(iv) No monetary Default or Event of Default shall have occurred and then be continuing as of the Release Date, unless all outstanding monetary Defaults and Events of Default are cured as a result of the Borrowing Base Property Release;
(v) After giving effect to such Borrowing Base Property Release, no Exclusion Event of Default shall occur as a result of the Borrowing Base Property Release.
(g) In the event that a Property becomes a Released Borrowing Base Property pursuant to clauses (e) or (f) above, then:
(i) Borrower shall deliver to Administrative Agent an updated Compliance Certificate reflecting the fact that such Property is no longer in the Borrowing Base and shall make the mandatory prepayments required under Section 3.2.1(b), if any;
(ii) Administrative Agent shall execute such reasonable documents as Borrower shall prepare and request in order to release the applicable Borrowing Base Ownership Entities from the Subsidiary Guaranty and Pledge (but not with respect to any remaining Borrowing Base Property in which such Borrowing Base Property has occurredOwnership Entities may have an interest); and
(iii) Borrower shall pay any and all reasonable out-of-pocket costs and expenses incurred in connection with the foregoing, including, without limitation, Administrative Agent’s reasonable attorneys’ fees and disbursements.
Appears in 1 contract
Borrowing Base Properties. To each Borrower’s knowledge and except (i) as disclosed in the Real Property Information delivered to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property:
(a) Each Borrowing Base Property Owner has good Except as disclosed on Schedule 5.6 attached hereto, each of the Borrower and each of the Subsidiary Guarantors have good, marketable, and record and marketable title in fee simple to all Borrowing Base Properties necessary or used of the Oil and Gas Interests described in the ordinary conduct of its businessInitial Engineering Report other than Immaterial Oil and Gas Interests, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in except Permitted Liens. With the exception of Immaterial Oil and Gas Interests, all material respects with all Legal Requirementsoil, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirementgas, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly other mineral leaseholds and fee interests comprising or indirectly conveyedaffecting the Oil and Gas Interests described in the Initial Engineering Report are valid, assignedsubsisting, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; , and all rentals, royalties, and other amounts due and payable in respect thereof have been duly paid. Except with respect to Immaterial Oil and Gas Interests, but without regard to any consent or non-consent provisions of any joint operating agreement covering any of the Proved Reserves of the Borrower and the Subsidiary Guarantors, the Borrower's and each Subsidiary Guarantor's share of (i) the costs for each of the Proved Reserves described in Initial Engineering Report is not greater than the decimal fraction set forth in the Initial Engineering Report, before and after payout, as the case may be, and described therein by the respective designations "working interests", "WI", "gross working interest", "GWI", or similar terms, and (ii) production from, allocated to, or attributed to each such Proved Reserves is not less than the Leases (including modifications thereto) are decimal fraction set forth in writingthe Initial Engineering Report, before and after payout, as the case may be, and there are no oral agreements described therein by the designations "net revenue interest", "NRI", or similar terms. Except with respect thereto; to Immaterial Oil and Gas Interests, each well drilled in respect of each Proved Developed Producing Hydrocarbon Reserves described in the Initial Engineering Report (iiii) the copies of is capable of, and is presently, producing Hydrocarbons in commercially profitable quantities, and each of the Leases Borrower and each Subsidiary Guarantor is currently receiving payments for its share of production, with no material funds in respect of any thereof being presently held in suspense, other than any such funds being held in suspense pending delivery of appropriate division orders, and (if anyii) has been drilled, bottomed, completed, and operated in compliance with all applicable Requirements of Law and no such well which is currently producing Hydrocarbons is subject to any penalty in production by reason of such well having produced in excess of its allowable production. For purposes of this Subsection 5.7(a), "Immaterial Oil & Gas Interests" means Oil and Gas Interests which, in the aggregate, do not represent more than two percent (2%) of the discounted present value of all Oil and Gas Interests as set forth in the most recent Engineering Report delivered to the Administrative Agent are true, correct and complete Banks in all material respects and have not been modified (or further modified); (iv) to connection with the knowledge of any Credit Party, no material defaults exist under any determination of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently then effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event with respect to any such Borrowing Base Property has occurredBase.
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Borrowing Base Properties. To each Borrower’s knowledge (1) Subject to the first sentence of Section 2.10(b), above, and except (i) as disclosed in Section 2.10(b)(x), below, with respect to any Net Cash Proceeds realized or received with respect to any Insurance and Condemnation Event at a Borrowing Base Property, the Real Property Information delivered Net Cash Proceeds shall at the request of Administrative Agent, be paid directly to Administrative Agent, and (ii) where the failure of any of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Propertyprovided that:
(aI) Each Borrowing Base Property Owner has good record if the Net Cash Proceeds are less than $1,000,000 and marketable title in fee simple to all Borrowing Base Properties necessary there is no Event of Default that remains unwaived or used in uncured, the ordinary conduct of its business, except for Administrative Agent shall release such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title Net Cash Proceeds to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only Borrower and/or the applicable Guarantor to Liens permitted by Section 6.01. All be used for repair or restoration of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each applicable Borrowing Base Property;
(eII) The current use if the Net Cash Proceeds are in an amount from $1,000,000 up to $4,000,000 and there is no Event of each Default that remains unwaived or uncured, the Administrative Agent shall permit such Net Cash Proceeds held by the Administrative Agent to be released to the Borrower or the applicable Guarantor to be used for repair or restoration but may condition such application upon the following conditions: (A) the restoration or repair will return the Borrowing Base Property complies in all material respects to substantially the same condition as existed prior to the casualty or condemnation, (B) the Net Cash Proceeds available therefrom (plus additional funds as may be required to be deposited by the Borrower with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent) will be sufficient to complete the required repair or restoration, and (C) the restoration or repair is capable of being completed by the date which is sixty (60) days prior to the then current Term Loan Maturity Date; and
(III) if the Net Cash Proceeds exceed $4,000,000, the Administrative Agent may permit insurance or condemnation proceeds held by the Administrative Agent to be released to the Borrower or the applicable Guarantor to be used for repair or restoration (provided, that if the Administrative Agent has elected not to release such proceeds to the Borrower, then 100% of the Net Cash Proceeds shall be applied as a principal prepayment of the Loans in the manner set forth in clause (viii) below) upon the following conditions: (A) the deposit with the Administrative Agent of such additional funds which the Administrative Agent determines are needed to pay all costs of the repair or restoration (including, without limitation, taxes, financing charges, insurance and rent rolls delivered during the repair period); (B) the establishment of an arrangement for lien releases and disbursement of funds acceptable to the Administrative Agent (the arrangement contained in this Agreement for disbursing Loan funds shall be deemed reasonable with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effectdisbursement of Net Cash Proceeds); (iiC) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered delivery to the Administrative Agent are trueof plans and specifications for the work, correct and complete in all material respects and have not been modified (or further modified); (iv) a contract for the work signed by a contractor reasonably acceptable to the knowledge Administrative Agent and a cost breakdown for the work, all of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could which shall be reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except acceptable to the Administrative Agent; (viiD) no tenant or other party has an option or right the delivery to the Administrative Agent of first refusal evidence acceptable to purchase the Administrative Agent in its reasonable determination (aa) that after completion of the work the income from the Borrowing Base Property will be sufficient to pay all or any portion expenses of any the Borrowing Base Property; (viiibb) no tenant has of the right to terminate any Lease continuation of Leases or execution of new Leases for not less than seventy percent (70%) of the net rentable area covered by Leases immediately prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ixcc) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No that upon completion of the work, the size, capacity and total value of the Borrowing Base Property will be at least as great as it was before the damage or condemnation occurred, and (E) there is no Event of Default that remains unwaived or uncured. The Borrower hereby acknowledges that the subject conditions described above are reasonable, and, if such conditions have not been satisfied within one hundred fifty (150) days of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which receipt by the Administrative Agent has not been notified of such insurance or condemnation proceeds, then Administrative Agent may apply such Net Cash Proceeds in writing; andaccordance with clause (viii) below.
(h2) Each Borrowing Base Property complies with The following (whether now existing or hereafter arising) are all absolutely and irrevocably assigned by the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed Borrower and each Guarantor to the Administrative Agent in writingand, no Exclusion Event with respect at the request of Administrative Agent, shall be paid directly to Administrative Agent: (i) all awards of damages and all other compensation payable directly or indirectly by reason of a condemnation or proposed condemnation for public or private use affecting all or any such part of, or any interest in, any Borrowing Base Property has occurredor Collateral; (ii) all proceeds of any insurance policies (whether or not expressly required by the Administrative Agent to be maintained by the Borrower or any Subsidiary, including, but not limited to, earthquake insurance and terrorism insurance, if any) payable by reason of loss sustained to all or any part of any Borrowing Base Property or Collateral; and (iii) all interest which may accrue on any of the foregoing. Subject to applicable law, the Administrative Agent may at its reasonable discretion apply all or any of the proceeds it receives to its expenses in settling, prosecuting or defending any claim and shall apply the remainder in accordance with clause (1) above. After the First Lien Termination Date, the Administrative Agent may commence, appear in, defend or prosecute any assigned claim or action and may adjust, compromise, settle and collect all claims and awards assigned to the Administrative Agent; provided, however, in no event shall the Administrative Agent be responsible for any failure to collect any claim or award unless caused by the malfeasance or nonfeasance by Administrative Agent or its employees or agents.
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Sources: Second Lien Credit Agreement (Pennsylvania Real Estate Investment Trust)
Borrowing Base Properties. To each Borrower’s knowledge For any period of 30 consecutive days there shall be fewer than five (5) Borrowing Base Properties (excluding the Sweet Home Property); then, and except in any such event, the Administrative Agent (i) as disclosed in shall at the Real Property Information delivered request, or may with the consent, of the Required Lenders, by notice to Administrative Agentthe Borrower, declare the Commitments of each Lender Party and the obligation of each Lender Party to make Advances (other than Letter of Credit Advances by an Issuing Bank or a Lender pursuant to Section 2.03(c) and Swing Line Advances by a Lender to the Swing Line Bank for a prior Swing Line Borrowing pursuant to Section 2.02(b)) and of each Issuing Bank to issue Letters of Credit to be terminated, whereupon the same shall forthwith terminate, and (ii) where shall at the failure request, or may with the consent, of the Required Lenders, (A) by notice to the Borrower, declare the Notes, all interest thereon and all other amounts payable under this Agreement and the other Loan Documents to be forthwith due and payable, whereupon the Notes, all such interest and all such amounts shall become and be forthwith due and payable, without presentment, demand, protest or further notice of any kind, all of which are hereby expressly waived by the following Borrower, and (B) by notice to each party required under the terms of any agreement in support of which a Letter of Credit is issued, request that all Obligations under such agreement be declared to be true due and correct would not constitute a Material Adverse Effect payable; provided, however that in the event of an actual or result in a Material Property Event deemed entry of an order for relief with respect to any Borrowing Base Property:
(a) Each Borrowing Base Property Owner has good record and marketable title in fee simple to all Borrowing Base Properties necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or result in a Material Property Event with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free any other Loan Party under any Bankruptcy Law, (y) the Commitments of each Lender Party and clear the obligation of all Liens each Lender Party to make Advances (other than Liens permitted Letter of Credit Advances by an Issuing Bank or a Lender pursuant to Section 6.012.03(c) and Swing Line Advances by a Lender pursuant to Section 2.02(b).
) and of each Issuing Bank to issue Letters of Credit shall automatically be terminated and (bz) Each Borrowing Base Property complies in the Notes, all material respects with such interest and all Legal Requirements, including all subdivision such amounts shall automatically become and platting requirementsbe due and payable, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Propertypresentment, demand, protest or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge notice of any such noncompliance except as disclosed to Administrative Agent;
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Propertykind, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to which are hereby expressly waived by the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event with respect to any such Borrowing Base Property has occurredBorrower.
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Borrowing Base Properties. To each Borrower’s knowledge (a) At all times, the REIT and except Borrower shall maintain the Borrowing Base Properties in accordance with this Article IX and the other terms and conditions of the Loan Documents.
(b) In addition to the other requirements that are set forth in the definition of “Borrowing Base Property,” in order for a Real Property to qualify as a Borrowing Base Property, it shall comply with the following conditions at all times:
(i) Such Borrowing Base Property shall be wholly owned by a Subsidiary Guarantor (other than the Borrowing Base Property known as disclosed in ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, which shall be wholly owned by the Real 163 Washington SPE) that complies with the covenants and provisions of this Agreement relating to Subsidiary Guarantors and the 163 Entities; provided, however, that a Borrowing Base Property Information delivered to may, with Administrative Agent’s written consent, be leased to a Subsidiary Guarantor under an Approved Ground Lease;
(ii) The representations and warranties contained in Sections 3.05(a), 3.06(b), 3.22, and 3.23 shall at all times be true and correct with respect to such Borrowing Base Property and such Borrowing Base Property shall be in compliance with the covenants set forth in Section 9.01(c);
(iii) Such Borrowing Base Property shall be an income producing, multi-family, mixed-use, retail, distribution, parking or office property, provided that parking facilities shall be permitted only if operated by a third-party operator and distribution facilities shall be permitted only to the extent they meet the conditions set forth in clause (v) of this Section 9.01(b);
(iv) At least eighty percent (80%) of the (x) units in any multi-family Borrowing Base Property, and (y) net rentable square footage of any other type of Borrowing Base Property (other than a parking facility), shall be subject to executed Leases from tenants in occupancy who are not in default beyond the expiration of all applicable notice and grace periods under their Lease and not in bankruptcy (the “Occupancy Rate”); provided, however, that if (A) on any date, the Occupancy Rate is less than eighty percent (80%), there shall be a grace period of two (2) fiscal quarters to increase such occupancy provided that (i) Borrower delivers written notice of the failure to comply with such occupancy requirement within three (3) Business Days after a Responsible Officer of Borrower obtains knowledge of such failure, and (ii) at all times during such grace period, the Occupancy Rate does not fall below seventy percent (70%) at any time and (B) on any date, the Occupancy Rate is less than seventy percent (70%), there shall be a grace period of two (2) fiscal quarters (which shall be concurrent with and not in addition to the two (2) fiscal quarter grace period referred to in clause (A), above) to increase such occupancy provided that (i) Borrower delivers written notice of the failure to comply with such occupancy requirement within three (3) Business Days after a Responsible Officer of Borrower obtains knowledge of such failure, (ii) at all times during such grace period, the Occupancy Rate does not fall below fifty percent (50%) at any time, and (iii) during the pendency of such grace period, the percentage applicable in calculating the Value-Based Borrowing Base Limit for the applicable Borrowing Base Property shall be reduced by fifty percent (50%); thereafter, and in the event any Borrowing Base Property has an Occupancy Rate below fifty percent (50%) at any time, such Borrowing Base Property shall be removed from the Borrowing Base pursuant to Section 9.03;
(v) If such Borrowing Base Property is a distribution facility, it shall be an Investment Grade Borrowing Base Property having at least eight (8) years remaining on the term of the Lease to the applicable Investment Grade Tenant at the time such facility is added to the Borrowing Base (excluding any extension options) and where the failure applicable Investment Grade Tenant shall be in occupancy, not in default beyond the expiration of all applicable notice and grace periods under its Lease and not in bankruptcy;
(vi) If such Borrowing Base Property is a Single Tenant Asset, then the remaining Lease term related thereto shall be no less than six (6) years (excluding any extension options);
(vii) An Appraisal shall be required for each Borrowing Base Property during the term of this Agreement as follows: (A) within six (6) months prior to the following Effective Date (with respect to each initial Borrowing Base Property that is added to the Borrowing Base upon the Effective Date, and (B) within six (6) months prior to the date that any Borrowing Base Property is added to the Borrowing Base in accordance with the Loan Documents (which respect to Borrowing Base Properties added after the Effective Date), and that in each case that is acceptable to Administrative Agent in its reasonable discretion, subject to the provisions of Sections 9.01(b)(viii) and (ix);
(viii) Notwithstanding anything to the contrary in clause (vii) above, in Administrative Agent’s sole discretion, a new Appraisal may be true and correct would not constitute a Material Adverse Effect or result in a Material required, at Borrower’s expense, for each Borrowing Base Property Event commencing (i) twenty four (24) months after the Effective Date (with respect to each initial Borrowing Base Property that is added to the Borrowing Base upon the Effective Date), (ii) twenty four (24) months after the date that any Borrowing Base Property is thereafter added to the Borrowing Base (with respect to any such subsequently-added Borrowing Base Property:), and (iii) twenty four (24) months after the date of any Appraisal obtained pursuant to this Section 9.01(viii). Borrower may, at its election and expense, also request a new Appraisal at any of such times. For purposes of this Section 9.01(b)(viii), an Appraisal that has a date of value that is no earlier than six (6) months prior to the end of any applicable 24-month period described in this Section 9.01(b)(viii) shall, if it is approved by Administrative Agent and complies with the requirements of this Agreement, be deemed to satisfy the requirements herein for a new Appraisal to be obtained commencing on each such 24-month period.
(aix) Each If the Net Operating Income for any Borrowing Base Property Owner has good record shall decrease (A) by more than five percent (5%) from one fiscal quarter to the next and marketable title the Net Operating Income of such Borrowing Base Property for the next succeeding fiscal quarter does not make up for such decline in fee simple Net Operating Income or (B) ten percent (10%) or more from the Net Operating Income of such Borrowing Base Property for the previous calendar year, then a new Appraisal for such Borrowing Base Property shall be required to be obtained at Borrower’s cost.
(x) For purposes of determining the Appraised Value of any Borrowing Base Property hereunder, the most recent Appraisal thereof obtained by in accordance with the terms hereof shall govern the determination of the Appraised Value thereof; provided, however that if a new Appraisal is not required to be obtained for such Borrowing Base Property pursuant to Section 9.01(b)(viii) or (ix), until such time as the new Appraisal shall have been obtained in accordance with this Agreement, then the Borrowing Base Asset Value of such Borrowing Base Property shall equal the lesser of the Acquisition Cost of such Borrowing Base Property or the Estimated Value thereof.
(xi) Borrower may elect, pursuant to the definition of “Borrowing Base Asset Value,” to require the determination of the component of the definition of Borrowing Base Asset Value referenced in clause (b) of the definition thereof to be based upon the Estimated Values of the Borrowing Base Properties or the Appraised Values of the Borrowing Base Properties only once per fiscal quarter, in connection with the delivery by Borrower to Administrative Agent of the Borrowing Base Certificate that is due to be delivered during such fiscal quarter, and such election shall be made on an “all or none” basis such that, if Borrower elects to require such determination to be based on Appraised Values, such election must be made as to all Borrowing Base Properties, and if Borrower elects to require such determination to be based on Estimated Values, such election must be made as to all Borrowing Base Properties necessary or used (provided, however, that in the ordinary conduct event that Borrower obtains an updated Appraisal pursuant to Section 9.01(b)(viii) Borrower shall be permitted to required that such determination be made on the basis of its businesssuch updated Appraised Value); provided, except further, that if the Appraised Value of one or more Borrowing Base Properties cannot be calculated solely because Appraisals have been ordered but have not yet been delivered for such defects Borrowing Base Property, as required hereby, the Borrowing Base Appraised Value may nonetheless be determined according to the Estimated Value of each such affected Borrowing Base Property and the Appraised Value of all other Borrowing Base Properties until such time as an Appraisal for such affected Borrowing Base Property has been obtained as provided herein.
(xii) The survey for such Borrowing Base Property delivered to the Administrative Agent in title as could not, individually connection with this Agreement shall be prepared in accordance with the 2011 Minimum Standard Detail Requirements for ALTA/ASM Land Title Surveys. Except for those matters reflected on such survey or in the aggregatetitle policy for such Borrowing Base Property delivered to the Administrative Agent in connection with this Agreement or as otherwise disclosed to the Administrative Agent, as of the date such Real Property is accepted as a Borrowing Base Property, there shall not be any construction or commencement of construction on such Borrowing Base Property of any new external structures, or additions or extensions thereto, or other external improvements, whether to existing structures or not. Except as may be disclosed on the surveys delivered pursuant to this Agreement and in the title policy for such Borrowing Base Property: (i) none of the material improvements comprising part of such Borrowing Base Property shall be outside the boundaries of such Borrowing Base Property (or building restriction or setback lines applicable thereto); (ii) no material improvements on adjoining properties shall encroach upon such Borrowing Base Property; and (iii) no material improvements comprising part of such Borrowing Base Property shall encroach upon or violate any easements or any other encumbrance upon such Borrowing Base Property, in each case other than minor encumbrances which could not reasonably be expected to have a Material Adverse Effect (x) material adverse effect with respect to the financial condition or result the operations of such Borrowing Base Property, (y) material adverse effect on the Borrowing Base Asset Value of such Borrowing Base Property, or (z) material adverse effect on the ownership of such Borrowing Base Property.
(xiii) All transfer taxes, deed stamps, intangible taxes or other amounts in the nature of transfer taxes required to be paid by any Credit Party under applicable legal requirements currently in effect in connection with the transfer of such Borrowing Base Property to the Borrower, any transfer of a Material controlling interest in the Borrower or the formation of the REIT, as applicable, shall have been paid or will be paid prior to delinquency. All mortgage, mortgage recording, stamp, intangible or other similar tax required to be paid by any Credit Party under applicable legal requirements currently in effect in connection with the execution, delivery, recordation, filing, registration, perfection or enforcement of any of the Loan Documents, including, without limitation, the Mortgage, shall have been paid prior to delinquency.
(xiv) The Borrower shall have delivered to Administrative Agent copies of all Leases and all unrecorded easement agreements, reciprocal easement agreements, management agreements and material agreements in Borrower’s possession or custody which affect in any material respect the Borrower’s interest in such Borrowing Base Property.
(xv) Borrower shall have received no notice of any condemnation proceeding involving such Borrowing Base Property Event or any portion thereof or parking facility used in connection therewith, nor shall any portion of such Borrowing Base Property or any parking facility used in connection therewith be damaged due to fire or other casualty, except those proceedings or casualties that could not reasonably be expected to materially interfere with the current use and value of such Borrowing Base Property or to cause such property to otherwise no longer qualify as a Borrowing Base Property.
(xvi) Such Borrowing Base Property shall have adequate rights of access to public ways and is currently served by adequate electric, gas, water, sewer, sanitary sewer and storm drain facilities. All public utilities necessary to the use and enjoyment of such Borrowing Base Property as intended to be used and enjoyed shall be located in the public right-of-way abutting such Borrowing Base Property or in private easements or license areas benefitting such Borrowing Base Property.
(xvii) No Credit Party shall have suffered, permitted or initiated the joint assessment of such Borrowing Base Property with any other real property constituting a tax lot separate and apart from the tax lot comprising such Borrowing Base Property.
(xviii) As of the date of its inclusion as a Borrowing Base Property, such Borrowing Base Property, including all buildings, improvements, parking facilities, sidewalks, storm drainage systems, roofs, plumbing systems, HVAC systems, fire protection systems, electrical systems, equipment, elevators, exterior sidings and doors, landscaping, irrigation systems and all structural components, shall be in good condition, order and repair in all material respects subject to reasonable and customary wear and tear; and there shall exist no structural or other material defects or damages in such Borrowing Base Property, whether latent or otherwise, and no Credit Party shall have received written notice from any insurance company or bonding company of any defects or inadequacies in such Borrowing Base Property, or any part thereof, which would, in either case, adversely affect the insurability of the same or cause the imposition of extraordinary premiums or charges thereon or of any termination or threatened termination of any policy of insurance or bond.
(xix) The Borrower shall have delivered to the Administrative Agent a true and correct copy of the Management Agreement that is in effect with respect to such Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title The Management Agreement with respect to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject delivered to the Administrative Agent shall be the only Management Agreement related to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a such Borrowing Base Property, and shall be in full force and effect with no default or event of default, in either case beyond all applicable notice and grace periods, existing thereunder.
(xx) To the knowledge of Borrower, no portion of such Borrowing Base Property shall have been purchased with proceeds of any use, activity, operation, or maintenance thereof or thereon, is not illegal activity and no part of the proceeds of any Credit Extension will be used in compliance connection with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;illegal activity.
(c) The Credit Parties have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property REIT and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, Borrower hereby covenant and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all such defaults that could reasonably be expected to be a Material Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property under Section 2.23(d)(ii) and, except as previously disclosed to the Administrative Agent in writing, no Exclusion Event agrees with respect to any such Borrowing Base Property has occurred.(i) to comply with Sections 5.05, 5.12, 5.18, 5.19, 5.21, 6.02, 6.11, and 6.18, and (ii) as follows:
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Sources: Credit Agreement (American Realty Capital New York Recovery Reit Inc)
Borrowing Base Properties. To each Borrower’s knowledge and except (ia) Requirements for an Investment Property to be Included as disclosed a Borrowing Base Property. Prior to any Investment Property being included as a Borrowing Base Property (and, in the Real case of the requirements set forth in clauses (iii) through (xi) below, at all times that such Investment Property Information delivered to Administrative Agentis a Borrowing Base Property as provided in Section 2.19(b)), and (ii) where the failure of any each of the following to be true and correct would not constitute a Material Adverse Effect or result in a Material Property Event with respect to any Borrowing Base Property:
(a) Each Borrowing Base Property Owner has good record and marketable title in fee simple to all Borrowing Base Properties necessary or used in the ordinary conduct of its business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to requirements shall have a Material Adverse Effect or result in a Material Property Event been satisfied with respect to such Investment Property (such requirements being referred to herein as the “Borrowing Base Property. Each applicable Borrowing Base Property Owner has good record and marketable fee simple title to the Borrowing Base Property owned by such Borrowing Base Property Owner, subject only to Liens permitted by Section 6.01. All of the outstanding Equity Interests in each Borrowing Base Property Owner have been validly issued, are fully paid and nonassessable and are owned by a Borrower or a Wholly Owned Subsidiary thereof free and clear of all Liens (other than Liens permitted by Section 6.01).Eligibility Criteria”):
(b) Each Borrowing Base Property complies in all material respects with all Legal Requirements, including all subdivision and platting requirements, without reliance on any adjoining or neighboring property. No Credit Party has received any written notice or written claim from any Person that a Borrowing Base Property, or any use, activity, operation, or maintenance thereof or thereon, is not in compliance with any Legal Requirement, and has no knowledge of any such noncompliance except as disclosed to Administrative Agent;
(ci) The Credit Parties Borrowers shall have not directly or indirectly conveyed, assigned, or otherwise disposed of, or transferred (or agreed to do so), other than pursuant to Permitted Liens, any development rights, air rights, or other similar rights, privileges, or attributes with respect to a Borrowing Base Property, including those arising under any zoning or property use ordinance or other Legal Requirements;
(d) All utility services necessary for the use of each Borrowing Base Property and the operation thereof for their intended purpose are available at each Borrowing Base Property;
(e) The current use of each Borrowing Base Property complies in all material respects with all applicable zoning ordinances, regulations, and restrictive covenants affecting such Borrowing Base Property, all use restrictions of any Governmental Authority having jurisdiction have been satisfied;
(f) Except as disclosed in writing to the Administrative Agent, the rent rolls delivered to provided the Administrative Agent with respect thereof are true, correct and complete in all material respects and the Leases referred to thereon are all valid and in full force and effect; (ii) the Leases (including modifications thereto) are in writing, and there are no oral agreements with respect thereto; (iii) the copies of each of the Leases (if any) delivered to the Administrative Agent are true, correct and complete in all material respects and have not been modified (or further modified); (iv) to the knowledge of any Credit Party, no material defaults exist under any of the Leases by any party (including any guarantor) thereto that, individually or in the aggregate with respect to all a written request for such defaults that could reasonably be expected to be a Material Investment Property Event; (v) no Credit Party has any knowledge of any presently effective notice of termination or notice of default given by any tenant in writing under any other Leases that individually or in the aggregate could reasonably be expected to be a Material Property Event; (vi) no Credit Party has made any presently effective assignment or pledge of any of the Leases, the rents or any interests therein except to the Administrative Agent; (vii) no tenant or other party has an option or right of first refusal to purchase all or any portion of any Borrowing Base Property; (viii) no tenant has the right to terminate any Lease prior to expiration of the stated term of such Lease (except as a result of counterparty breach, casualty, condemnation or other customary basis of a right to terminate); and (ix) no tenant has prepaid more than one month’s rent in advance (except for bona fide security deposits);
(g) No Borrowing Base Property is the subject of any pending or, to any Credit Party’s knowledge, threatened condemnation or material adverse zoning proceeding for which Administrative Agent has not been notified in writing; and
(h) Each Borrowing Base Property complies with the conditions to be included as a Borrowing Base Property, which request shall be accompanied by a Borrowing Base Proposal Package with respect to such Investment Property.
(ii) Within ten (10) Business Days after receipt of the Borrowing Base Proposal Package, the Administrative Agent shall give notice to the Borrowers of whether the Administrative Agent has approved such proposed Investment Property as a Borrowing Base Property; provided, that in case of an Investment Property that is subject to an Existing NY Mortgage in respect of which a Mortgage Debt Assignment has been requested by the Borrowers in accordance with Section 2.03(b), any such approval of such Investment Property as a Borrowing Base Property may be conditioned upon the consummation of such Mortgage Debt Assignment. The Administrative Agent shall not unreasonably withhold such approval so long as such proposed Borrowing Base Property satisfies all of the Borrowing Base Eligibility Criteria. Notwithstanding the foregoing, the failure of any proposed Borrowing Base Property to comply with one or more of the Borrowing Base Eligibility Criteria or the other requirements of this Section 2.19 shall not preclude the addition of such proposed Investment Property as a Borrowing Base Property so long as the Required Lenders have expressly consented to the addition of such proposed Investment Property as a Borrowing Base Property notwithstanding the failure to satisfy such conditions or requirements, as applicable.
(iii) Such Investment Property shall be used primarily for office and/or retail purposes.
(iv) The Affiliated Investor that owns such Investment Property (or, if applicable, that is the lessee under an Eligible Ground Lease in respect of such Investment Property) shall be a Wholly-Owned Subsidiary of ESR OP, and all of the Equity Interests of such Affiliated Investor (together with all of the Equity Interests of any direct or indirect Subsidiary of ESR OP that owns any Equity Interests of such Affiliated Investor) shall be pledged as Collateral in favor of the Administrative Agent, for the benefit of the Secured Parties, pursuant to the Collateral Documents; provided, that if at any time the Exemption Conditions exist with respect to any Subsidiary that directly or indirectly owns any Equity Interests of such Affiliated Investor, such Subsidiary shall not be required to pledge the Equity Interests it owns in such Affiliated Investor or in any direct or indirect parent thereof.
(v) The Affiliated Investor that owns such Investment Property (or, if applicable, that is the lessee under an Eligible Ground Lease in respect of such Investment Property) shall be a Subsidiary Guarantor or a Borrower, and each Subsidiary of ESR OP that directly or indirectly owns any Equity Interests in such Affiliated Investor shall be a Borrower or Subsidiary Guarantor; provided, that if at any time the Exemption Conditions exist with respect to (x) the Affiliated Investor that owns such Investment Property, such Affiliated Investor shall not be required to be a Subsidiary Guarantor or Borrower or (y) any Subsidiary of ESR OP that directly or indirectly owns any Equity Interests of such Affiliated Investor, such Subsidiary shall not be required to be a Subsidiary Guarantor or Borrower.
(vi) The Affiliated Investor that owns such Investment Property (or, if applicable, that is the lessee under an Eligible Ground Lease in respect of such Investment Property) must be organized under the laws of, and have its principal place of business and chief executive office located in, the United States of America, any State thereof or the District of Columbia.
(vii) Such Investment Property shall be located in the United States of America.
(viii) Such Investment Property shall be free and clear of all negative pledges and/or encumbrances or restrictions on the ability of the Affiliated Investor that owns or leases such Investment Property to transfer or encumber such Investment Property or any income therefrom or proceeds thereof (other than any such encumbrances or restrictions contained in the Loan Documents).
(ix) The Affiliated Investor that owns such Investment Property shall not have any Indebtedness (other than Obligations) and shall not be subject to any proceedings under any Debtor Relief Law.
(x) Such Investment Property shall not be subject to any ground leases (other than Eligible Ground Leases).
(xi) There shall not exist any Lien or other encumbrance on (x) such Investment Property (or any income therefrom or proceeds thereof), other than Permitted Borrowing Base Property Liens, (y) any other assets or property of the Affiliated Investor that owns such Investment Property, other than Liens permitted under Section 2.23(d)(ii7.01 or (z) andany of the Equity Interests of the Affiliated Investor that owns such Investment Property (or any direct or indirect Subsidiary of ESR OP that owns any Equity Interests of such Affiliated Investor), except including any right to receive distributions or other amounts in respect of such Equity Interests, other than Liens permitted under Section 7.01(a).
(xii) After giving pro forma effect to the inclusion of such Investment Property as previously disclosed a Borrowing Base Property, the minimum aggregate occupancy for all Borrowing Base Properties (excluding for this purpose the Empire State Building) shall not be less than 75% (determined based on tenants in occupancy and paying rent); provided, that such Investment Property may be included as a Borrowing Base Property notwithstanding its failure to satisfy the provisions of this clause (ix), but subject to the other provisions of this Section 2.19, so long as the failure to satisfy the minimum occupancy requirement set forth in this clause (ix) is cured and ceases to exist within forty-five (45) days following the occurrence thereof.
(xiii) The Administrative Agent and the Lenders shall have received an Availability Certificate from the Borrowers showing Availability after giving effect to the inclusion of such Investment Property as a Borrowing Base Property.
(xiv) The Administrative Agent and the Lenders shall have received a copy of the limited liability company operating agreement, partnership agreement, bylaws or other similar organizational documents of the Affiliated Investor who owns such Investment Property (or, if applicable, that is the lessee under an Eligible Ground Lease in respect of such Investment Property) and each Subsidiary of ESR OP that directly or indirectly owns any Equity Interests in such Affiliated Investor, which organizational documents shall be (x) in form and substance reasonably satisfactory to the Administrative Agent and (y) certified by a Responsible Officer of the Parent as being true, correct and complete.
(xv) The Administrative Agent shall have received environmental assessment reports, evidence of insurance and such other information concerning such Investment Property as the Administrative Agent may reasonably request, in each case in form and substance reasonably satisfactory to the Administrative Agent, and (in the case of environmental assessment reports) that demonstrate to the satisfaction of the Administrative Agent that such Investment Property is free from environmental issues that, or that could reasonably be expected to, materially impair the operation of such Investment Property or otherwise result in a Material Adverse Effect, in each case unless such environmental issues are remediable through ordinary course capital expenditures and the Loan Parties are diligently pursuing the remediation thereof in accordance with applicable Law.
(b) Removal of Investment Property as a Borrowing Base Property as a Result of Failure to Satisfy Borrowing Base Eligibility Criteria. If, following the inclusion of any Investment Property as a Borrowing Base Property, such Investment Property fails to satisfy any of the Borrowing Base Eligibility Criteria set forth in Section 2.19(a)(iii) through (xi) for a period of thirty (30) days, then such Investment Property shall immediately cease to be a Borrowing Base Property on such thirtieth day. In addition in the event that (i) the minimum aggregate occupancy for all Borrowing Base Properties (excluding for this purpose the Empire State Building) becomes less than 75% (determined based on tenants in occupancy and paying rent) for more than 45 days, Investment Properties that are partially or fully vacant but still producing rental income and that otherwise satisfy the other Borrowing Base Eligibility Criteria will cease to be Borrowing Base Properties to the extent necessary to cause such minimum occupancy requirement to be satisfied (which removal of Investment Properties from the pool of Borrowing Base Properties for purposes of satisfying this minimum occupancy requirement shall be in the order indicated by the Borrowers) and (ii) the Empire State Building at any time ceases to be a Borrowing Base Property for any reason, the Empire State Observatory shall also automatically cease to be a Borrowing Base Property at such time. If any Investment Property ceases to be a Borrowing Base Property as a result of any of the circumstances set forth in the prior two (2) sentences, the Borrowers shall immediately provide the Administrative Agent with written notice thereof, together with an Availability Certificate (giving pro forma effect to the removal of the applicable Investment Propert(ies) from the pool of Borrowing Base Properties). If, after giving effect to any such removal of the applicable Investment Propert(ies) from the pool of Borrowing Base Properties, Availability is less than $0, the Borrowers shall immediately prepay Loans and L/C Borrowings and/or Cash Collateralize the L/C Obligations (other than the L/C Borrowings) in an aggregate amount necessary to cause Availability to be greater than or equal to $0 in the manner specified in Section 2.07(b)(ii). If any Investment Property that is subject to an Assigned Mortgage ceases to be a Borrowing Base Property pursuant to this Section 2.19(b), then such Assigned Mortgage shall be terminated in accordance with Section 2.22(b); provided, that if the Borrowers request that in lieu of such termination such Assigned Mortgage instead be transferred to another Borrowing Base Property located in the State of New York that is identified by the Borrowers, the Administrative Agent may in its sole and absolute discretion permit such Assigned Mortgage to be transferred in its entirety to such other Borrowing Base Property (and if the Administrative Agent does agree to allow such transfer, (x) such transfer shall be made at the Borrowers’ sole cost and expense pursuant to documentation satisfactory to the Administrative Agent and (y) on or prior to the time of such transfer, the Affiliated Investor that owns the Borrowing Base Property that will become subject to such Assigned Mortgage shall have become a Borrower in accordance with Section 6.12(c)).
(c) Removal of Investment Property from the pool of Borrowing Base Properties by the Borrowers. An Investment Property may be removed from the pool of Borrowing Base Properties by the Borrowers upon the completion of the following conditions precedent to the reasonable satisfaction of the Administrative Agent:
(i) The Borrowers shall have delivered to the Administrative Agent and the Lenders on or prior to the date that is ten (10) Business Days (or such shorter period of time as agreed to by the Administrative Agent in writing) prior to the date on which such removal is to be effected, no Exclusion Event a written notice of its desire to remove such Investment Property from the pool of Borrowing Base Properties;
(ii) If the proposed removal is with respect to any the Empire State Building, the Empire State Observatory must also be removed from the pool of Borrowing Base Properties at the same time as the Empire State Building is removed (and the requirements set forth in clauses (iii) and (iv) of this Section 2.19(c) must also be satisfied with respect to the Empire State Observatory at the same time as such requirements are satisfied with respect to the Empire State Building).
(iii) If the proposed removal is with respect to a Borrowing Base Property that is subject to an Assigned Mortgage (other than any such proposed removal in connection with a Replacement Mortgage Financing, in which case the requirements of Section 2.22(d) shall be required to be satisfied), then such Assigned Mortgage shall be terminated in accordance with Section 2.22(b); provided, that if the Borrowers request that in lieu of such termination such Assigned Mortgage instead be transferred to another Borrowing Base Property located in the State of New York that is identified by the Borrowers, the Administrative Agent may in its sole and absolute discretion permit such Assigned Mortgage to be transferred in its entirety to such other Borrowing Base Property (and if the Administrative Agent does agree to allow such transfer, (x) such transfer shall be made at the Borrowers’ sole cost and expense pursuant to documentation satisfactory to the Administrative Agent and (y) on or prior to the time of such transfer, the Affiliated Investor that owns the Borrowing Base Property that will become subject to such Assigned Mortgage shall have become a Borrower in accordance with Section 6.12(c)).
(iv) On or before the date that is five (5) Business Days (or such shorter period of time as agreed to by the Administrative Agent in writing) prior to the date of the proposed removal, the Borrowers shall have submitted to the Administrative Agent and the Lenders a certificate executed by a Responsible Officer of the Parent certifying to the Administrative Agent and the Lenders that (1) immediately before and immediately after giving effect to such release, no Default or Event of Default has occurredoccurred and is continuing or would result therefrom, (2) immediately after giving effect to such release, the Loan Parties are in compliance with the financial covenants set forth in Section 7.11 on a pro forma basis as if the removal and the repayment contemplated Section 2.19(c)(v) below had occurred on the last day of the then mostly recently ended fiscal quarter of the Parent for which financial statements have provided to the Administrative Agent and the Lenders pursuant to Section 6.01(a) or (b) (and such certificate shall contain a reasonably detailed calculation thereof) and (3) the representations and warranties of the Borrowers and each other Loan Party contained in Article V or any other Loan Document are true and correct in all material respects on and as of the date of such release and immediately after giving effect to such release, except (A) to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date, (B) to the extent that any such representations and warranties relate to the Investment Property being released, (C) any representation or warranty that is already by its terms qualified as to “materiality”, “Material Adverse Effect” or similar language shall be true and correct in all respects as of such date after giving effect to such qualification and (D) for purposes of this Section 2.19(c), the representations and warranties contained in subsections (a) and (b) of Section 5.05 shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01.
(v) On or before the date that is two (2) Business Days (or such shorter period of time as agreed to by the Administrative Agent in writing) prior to the date of the proposed release, the Borrowers shall have
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