THIRD
AMENDED AND RESTATED
CREDIT AGREEMENT
among
BRANDYWINE REALTY TRUST
and
BRANDYWINE OPERATING PARTNERSHIP, L.P.,
as Borrowers
and
CERTAIN SUBSIDIARIES OF THE BORROWERS
as Guarantors
and
THE LENDERS IDENTIFIED HEREIN
and
BANK OF AMERICA, N.A.
as Administrative Agent
and
CITIBANK, N.A.,
as Syndication Agent
and
COMMERZBANK AG, NEW YORK AND GRAND CAYMAN BRANCHES
and
FLEET NATIONAL BANK
as Co-Documentation Agents
DATED AS OF JUNE 29, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ SECURITIES LLC
as Sole Lead Arranger and Sole Book Manager
TABLE OF CONTENTS
Page
SECTION 1 DEFINITIONS AND ACCOUNTING TERMS.......................................................................2
--------------------------------
1.1 Definitions.....................................................................................2
-----------
1.2 Computation of Time Periods and Other Definition Provisions....................................24
-----------------------------------------------------------
1.3 Accounting Terms...............................................................................24
----------------
1.4 Joint Venture Investments......................................................................25
-------------------------
SECTION 2 CREDIT FACILITY.......................................................................................25
---------------
2.1 Revolving Loans................................................................................25
---------------
2.2 Letter of Credit Subfacility...................................................................28
----------------------------
2.3 Joint and Several Liability of the Borrowers...................................................34
--------------------------------------------
2.4 Appointment of BOP.............................................................................36
------------------
2.5 Non-Recourse...................................................................................36
------------
SECTION 3 GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT..........................................36
------------------------------------------------------------
3.1 Interest.......................................................................................36
--------
3.2 Place and Manner of Payments...................................................................37
----------------------------
3.3 Prepayments....................................................................................37
-----------
3.4 Fees...........................................................................................38
----
3.5 Payment in full at Maturity; Extension of Maturity.............................................39
--------------------------------------------------
3.6 Computations of Interest and Fees..............................................................39
---------------------------------
3.7 Pro Rata Treatment.............................................................................40
------------------
3.8 Sharing of Payments............................................................................41
-------------------
3.9 Capital Adequacy...............................................................................42
----------------
3.10 Inability To Determine Interest Rate...........................................................42
------------------------------------
3.11 Illegality.....................................................................................43
----------
3.12 Requirements of Law............................................................................43
-------------------
3.13 Taxes..........................................................................................45
-----
3.14 Compensation...................................................................................47
------------
3.15 Mitigation; Mandatory Assignment...............................................................48
--------------------------------
TABLE OF CONTENTS
Page
SECTION 4 GUARANTY..............................................................................................48
--------
4.1 Guaranty of Payment............................................................................48
-------------------
4.2 Obligations Unconditional......................................................................49
-------------------------
4.3 Modifications..................................................................................50
-------------
4.4 Waiver of Rights...............................................................................50
----------------
4.5 Reinstatement..................................................................................50
-------------
4.6 Remedies.......................................................................................51
--------
4.7 Limitation of Guaranty.........................................................................51
----------------------
4.8 Rights of Contribution.........................................................................51
----------------------
SECTION 5 CONDITIONS PRECEDENT..................................................................................52
--------------------
5.1 Closing Conditions.............................................................................52
------------------
5.2 Conditions to All Extensions of Credit.........................................................56
--------------------------------------
SECTION 6 REPRESENTATIONS AND WARRANTIES........................................................................57
------------------------------
6.1 Financial Condition............................................................................57
-------------------
6.2 No Material Change.............................................................................57
------------------
6.3 Organization and Good Standing.................................................................57
------------------------------
6.4 Due Authorization..............................................................................57
-----------------
6.5 No Conflicts...................................................................................57
------------
6.6 Consents.......................................................................................58
--------
6.7 Enforceable Obligations........................................................................58
-----------------------
6.8 No Default.....................................................................................58
----------
6.9 Ownership......................................................................................58
---------
6.10 Indebtedness...................................................................................58
------------
6.11 Litigation.....................................................................................58
----------
6.12 Taxes..........................................................................................58
-----
6.13 Compliance with Law............................................................................58
-------------------
6.14 Compliance with ERISA..........................................................................59
---------------------
6.15 Organization Structure/Subsidiaries............................................................60
-----------------------------------
6.16 Use of Proceeds; Margin Stock..................................................................60
-----------------------------
6.17 Government Regulation..........................................................................60
---------------------
6.18 Environmental Matters..........................................................................61
---------------------
6.19 Solvency.......................................................................................63
--------
6.20 Investments....................................................................................63
-----------
6.21 Location of Properties.........................................................................63
----------------------
6.22 Disclosure.....................................................................................63
----------
6.23 Licenses, etc..................................................................................63
-------------
6.24 No Burdensome Restrictions.....................................................................63
--------------------------
6.25 Excluded Material Subsidiaries.................................................................64
------------------------------
TABLE OF CONTENTS
Page
SECTION 7 AFFIRMATIVE COVENANTS.................................................................................65
---------------------
7.1 Information Covenants..........................................................................65
---------------------
7.2 Financial Covenants............................................................................69
-------------------
7.3 Preservation of Existence......................................................................69
-------------------------
7.4 Books and Records..............................................................................69
-----------------
7.5 Compliance with Law............................................................................70
-------------------
7.6 Payment of Taxes and Other Indebtedness........................................................70
---------------------------------------
7.7 Insurance......................................................................................70
---------
7.8 Maintenance of Assets..........................................................................70
---------------------
7.9 Performance of Obligations.....................................................................70
--------------------------
7.10 Use of Proceeds................................................................................71
---------------
7.11 Audits/Inspections.............................................................................71
------------------
7.12 Additional Credit Parties......................................................................71
-------------------------
7.13 Interest Rate Protection Agreements............................................................72
-----------------------------------
7.14 Construction...................................................................................72
------------
7.15 Acquisitions...................................................................................72
------------
SECTION 8 NEGATIVE COVENANTS....................................................................................72
------------------
8.1 Indebtedness...................................................................................72
------------
8.2 Liens..........................................................................................73
-----
8.3 Nature of Business.............................................................................73
------------------
8.4 Consolidation and Merger.......................................................................73
------------------------
8.5 Sale or Lease of Assets........................................................................73
-----------------------
8.6 Advances, Investments and Loans................................................................74
-------------------------------
8.7 Restricted Payments............................................................................74
-------------------
8.8 Transactions with Affiliates...................................................................74
----------------------------
8.9 Fiscal Year; Organizational Documents..........................................................75
-------------------------------------
8.10 Limitations....................................................................................75
-----------
8.11 Other Negative Pledges.........................................................................75
----------------------
8.12 Construction and Development...................................................................75
----------------------------
SECTION 9 EVENTS OF DEFAULT.....................................................................................76
-----------------
9.1 Events of Default..............................................................................76
-----------------
9.2 Acceleration; Remedies.........................................................................78
----------------------
9.3 Allocation of Payments After Event of Default..................................................80
---------------------------------------------
TABLE OF CONTENTS
Page
SECTION 10 AGENCY PROVISIONS....................................................................................81
-----------------
10.1 Appointment....................................................................................81
-----------
10.2 Delegation of Duties...........................................................................81
--------------------
10.3 Exculpatory Provisions.........................................................................81
----------------------
10.4 Reliance on Communications.....................................................................82
--------------------------
10.5 Notice of Default..............................................................................82
-----------------
10.6 Non-Reliance on Administrative Agent and Other Lenders.........................................83
------------------------------------------------------
10.7 Indemnification................................................................................83
---------------
10.8 Administrative Agent in Its Individual Capacity................................................84
-----------------------------------------------
10.9 Successor Agent................................................................................84
---------------
SECTION 11 MISCELLANEOUS........................................................................................85
-------------
11.1 Notices........................................................................................85
-------
11.2 Right of Set-Off...............................................................................85
----------------
11.3 Benefit of Agreement...........................................................................86
--------------------
11.4 No Waiver; Remedies Cumulative.................................................................89
------------------------------
11.5 Payment of Expenses; Indemnification...........................................................89
------------------------------------
11.6 Amendments, Waivers and Consents...............................................................90
--------------------------------
11.7 Counterparts/Telecopy..........................................................................91
---------------------
11.8 Headings.......................................................................................91
--------
11.9 Defaulting Lender..............................................................................91
-----------------
11.10 Survival of Indemnification and Representations and Warranties.................................91
--------------------------------------------------------------
11.11 Governing Law; Jurisdiction....................................................................92
---------------------------
11.12 Waiver of Jury Trial...........................................................................92
--------------------
11.13 Time...........................................................................................92
----
11.14 Severability...................................................................................92
------------
11.15 Entirety.......................................................................................92
--------
11.16 Binding Effect.................................................................................93
--------------
11.17 Confidentiality................................................................................93
---------------
11.18 Further Assurances.............................................................................94
------------------
11.19 Release of Guarantors..........................................................................94
---------------------
SCHEDULES
Schedule 1.1(a) Revolving Loan Commitment Percentages
Schedule 2.2(c) Existing Letters of Credit
Schedule 6.15 Organization Structure/Subsidiaries
Schedule 6.21 Properties
Schedule 6.25 Excluded Material Subsidiaries
Schedule 8.2 Existing Liens
Schedule 11.1 Notices
EXHIBITS
Exhibit 2.1(b) Form of Notice of Borrowing
Exhibit 2.1(e) Form of Notice of Continuation/Conversion
Exhibit 2.1(g) Form of Revolving Note
Exhibit 7.1(c) Form of Officer's Certificate
Exhibit 7.12 Form of Joinder Agreement
Exhibit 11.3 Form of Assignment Agreement
THIRD
AMENDED AND RESTATED
CREDIT AGREEMENT
THIS THIRD AMENDED AND RESTATED CREDIT AGREEMENT (as amended,
supplemented or otherwise modified from time to time, this "Credit Agreement")
is entered into as of June 29, 2001 among BRANDYWINE REALTY TRUST ("BRT"), a
Maryland real estate investment trust and BRANDYWINE OPERATING PARTNERSHIP, L.P.
("BOP"), a Delaware limited partnership (collectively, the "Borrowers"), certain
Subsidiaries of the Borrowers, as Guarantors, the Lenders (as defined herein)
and BANK OF AMERICA, N.A., as Administrative Agent for the Lenders (the
"Administrative Agent").
RECITALS
WHEREAS, the Borrowers are party to that certain Second Amended and
Restated Credit Agreement, dated as of September 28, 1998, among the Borrowers,
certain Subsidiaries of the Borrowers, as guarantors, the lenders identified
therein and Bank of America, N.A., as administrative agent (as amended by that
certain First Amendment to Second Amended and Restated Credit Agreement, dated
as of August 3, 1999 and by that certain Second Amendment to Second Amended and
Restated Credit Agreement, dated as of October 21, 1999, and as otherwise
amended from time to time, together with all other documents and instruments
executed and delivered in connection therewith, the "Existing Credit
Agreement");
WHEREAS, the Borrowers desire to amend and restate the Existing Credit
Agreement to provide a revolving credit facility in an aggregate amount of up to
$500 million;
WHEREAS, the Guarantors have agreed to unconditionally guarantee all
the obligations of the Borrowers hereunder; and
WHEREAS, the Lenders party hereto have agreed to make the requested
amended and restated revolving credit facility available to the Borrowers on the
terms and conditions hereinafter set forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Definitions.
As used herein, the following terms shall have the meanings herein
specified unless the context otherwise requires. Defined terms herein shall
include in the singular number the plural and in the plural the singular:
"Adjusted Base Rate" means the Base Rate plus .25% per annum.
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
Applicable Percentage.
"Adjusted NOI" means NOI less (a) an annual sum of $.50 per
square foot for all Properties and (b) all interest income of the
Combined Parties for the applicable period.
"Adjusted Total Assets" means Total Assets less any Properties
held by Excluded Material Subsidiaries.
"Administrative Agent" means Bank of America or any successor
administrative agent appointed pursuant to Section 10.9.
"Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling (including but not limited to
all directors and officers of such Person), controlled by or under
direct or indirect common control with such Person. A Person shall be
deemed to control a corporation, partnership, limited liability company
or real estate investment trust if such Person possesses, directly or
indirectly, the power (i) to vote 10% or more of the securities having
ordinary voting power for the election of directors of such corporation
or real estate investment trust or to vote 10% or more of the
partnership or membership interests of such partnership or limited
liability company or (ii) to direct or cause direction of the
management and policies of such corporation, trust, limited liability
company or partnership, whether through the ownership of voting
securities, as managing member or general partner, by contract or
otherwise.
"Agency Services Address" means ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn.: ▇▇▇▇▇▇ ▇▇▇▇▇▇, or such other
address as may be identified by written notice from the Administrative
Agent to the Borrowers.
2
"Agent-Related Persons" means the Administrative Agent
(including any successor administrative agent), together with its
Affiliates (including, in the case of Bank of America in its capacity
as Administrative Agent, the Arranger), and the officers, directors,
employees, agents and attorneys-in-fact of such Persons and Affiliates.
"Annualized Capitalized Modified Adjusted NOI" means
Annualized Modified Adjusted NOI divided by the Capitalization Rate.
"Annualized Modified Adjusted NOI" means an amount equal to
(a) Adjusted NOI for the prior fiscal quarter for all Properties owned
during such entire fiscal quarter multiplied times four plus (b)
Adjusted NOI for the number of days owned for all Properties acquired
during such fiscal quarter multiplied by a fraction equal to 365
divided by the number of days such Property was owned by a Combined
Party.
"Applicable Percentage" means:
(a) if (i) BRT does not have at least two Investment
Grade Ratings in effect and (ii) BOP does not have at least
two Investment Grade Ratings in effect, the appropriate
applicable percentages corresponding to the Leverage Ratio in
effect as of the most recent Calculation Date as shown below:
------------- ----------------------------- -------------------------
Pricing Level Leverage Applicable Percentage for
Ratio Eurodollar Loans
------------- ----------------------------- -------------------------
I < .35 to 1.0 1.25%
-
------------- ----------------------------- -------------------------
II > .35 to 1.0 but < .45 to 1.0 1.40%
-
------------- ----------------------------- -------------------------
III > .45 to 1.0 but < .50 to 1.0 1.50%
-
------------- ----------------------------- -------------------------
IV > .50 to 1.0 1.75%
------------- ----------------------------- -------------------------
(b) if either (i) BRT has at least two Investment
Grade Ratings in effect or (ii) BOP has at least two
Investment Grade Ratings in effect, the appropriate applicable
percentages corresponding to the Unsecured Senior Debt Ratings
of (A) BRT if BRT has at least two Investment Grade Ratings in
effect and BOP does not, (B) BOP if BOP has at least two
Investment Grade Ratings in effect and BRT does not or (C) if
both BRT and BOP have at least two Investment Grade Ratings
then the Unsecured Senior Debt Ratings of BRT or BOP, as
applicable, that would provide the highest pricing hereunder,
in each case as of the most recent Calculation Date as shown
below:
------------------- ------------------------------------ ----------------------------
Pricing Level Unsecured Senior Debt Rating Applicable Percentage for
Eurodollar Loans
------------------- ------------------------------------ ----------------------------
I At least two of the following: .90%
BBB or better from S&P or
Baa2 or better from ▇▇▇▇▇'▇ or
BBB or better from Fitch
------------------- ------------------------------------ ----------------------------
II At least two of the following: 1.05%
BBB- from S&P
Baa3 from ▇▇▇▇▇'▇ or
BBB- from Fitch
------------------- ------------------------------------ ----------------------------
3
The Applicable Percentage for Revolving Loans shall be
determined and adjusted on the date (each a "Calculation Date") (i) if
the Applicable Percentage is determined pursuant to clause (a) above,
five Business Days after the date on which the Borrowers provide the
officer's certificate in accordance with the provisions of Section
7.1(c); provided that if the Borrowers fail to provide the officer's
certificate required by Section 7.1(c) on or before the date required
by Section 7.1(c), the Applicable Percentage for Revolving Loans from
such date shall be based on Pricing Level III in clause (a) above until
such time that an appropriate officer's certificate is provided
whereupon the Pricing Level shall be determined by the then current
Leverage Ratio or (ii) if the Applicable Percentage is determined
pursuant to clause (b) above, the date BRT or BOP obtains an Unsecured
Senior Debt Rating from at least two of S&P, Moody's or Fitch or the
date there is a change in any Unsecured Senior Debt Rating of BRT or
BOP that would cause a change in the Applicable Percentage pursuant to
clause (b) above, in each case promptly after the Administrative Agent
receives notice regarding such Unsecured Senior Debt Rating. Each
Applicable Percentage shall be effective from one Calculation Date
until the next Calculation Date. Any adjustment in the Applicable
Percentage shall be applicable both to new Revolving Loans made and to
all existing Revolving Loans.
The Borrowers shall promptly deliver to the Administrative
Agent, at the address set forth on Schedule 11.1 and at the Agency
Services Address, information regarding any change in the Unsecured
Senior Debt Rating or Leverage Ratio that would change the existing
Pricing Level as set forth above.
"Arranger" means Banc of America Securities LLC, in its
capacity as sole lead arranger and sole book manager.
"Bank of America" means Bank of America, N.A., a national
banking association, or any successor thereto.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from
time to time.
"Base Rate" means, for any day, the rate per annum equal to
the greater of (a) the Federal Funds Rate in effect on such day plus
1/2 of 1% or (b) the Prime Rate in effect on such day. Any change in
the Base Rate due to a change in the Prime Rate or the Federal Funds
Rate shall be effective on the effective date of such change in the
Prime Rate or the Federal Funds Rate, respectively.
"Base Rate Loan" means a Loan bearing interest based on a rate
determined by reference to the Base Rate.
"BOP" means Brandywine Operating Partnership, L.P., a Delaware
limited partnership, together with any successors and permitted
assigns.
4
"Borrowers" means BRT and BOP and "Borrower" means either one
of them.
"BRT" means Brandywine Realty Trust, a Maryland real estate
investment trust, together with any successors and permitted assigns.
"Business Day" means any day other than a Saturday, a Sunday,
a legal holiday or a day on which banking institutions are authorized
or required by law or other governmental action to close in Charlotte,
North Carolina or New York, New York; provided that in the case of
Eurodollar Loans, such day is also a day on which dealings between
banks are carried on in Dollar deposits in the London interbank market.
"Calculation Date" has the meaning set forth in the definition
of Applicable Percentage in this Section 1.1.
"Capital Expenditures" means all expenditures of the Borrowers
and their Subsidiaries which, in accordance with GAAP, would be
classified as capital expenditures, including, without limitation,
Capital Leases.
"Capital Lease" means, as applied to any Person, any lease of
any property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a
capital lease on a balance sheet of that Person.
"Capital Percentage" means, with respect to the interest of a
Credit Party or one of its Subsidiaries in another Person, the
percentage interest of such Person based on the aggregate amount of net
capital contributed by such Credit Party or such Subsidiary in such
Person at the time of determination relative to all capital
contributions made in such Person at such time of determination.
"Capitalization Rate" means, as of the Closing Date, 9.5%;
however, the Capitalization Rate shall be reviewed annually (but not
more often than annually) by the Administrative Agent (beginning with
the date one year after the Closing Date) and shall be subject to
adjustment by the Required Lenders, in their sole discretion, based
upon market conditions for comparable property types; provided that the
Capitalization Rate cannot be adjusted by more than 1.25% annually.
5
"Cash Equivalents" means (a) securities issued or directly and
fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and
credit of the United States of America is pledged in support thereof)
having maturities of not more than twelve months from the date of
acquisition, (b) Dollar denominated time and demand deposits and
certificates of deposit of (i) any Lender or any of its Affiliates,
(ii) any domestic commercial bank having capital and surplus in excess
of $500,000,000 or (iii) any bank whose short-term commercial paper
rating from S&P is at least A-1 or the equivalent thereof or from
▇▇▇▇▇'▇ is at least P-1 or the equivalent thereof (any such bank being
an "Approved Bank"), in each case with maturities of not more than 270
days from the date of acquisition, (c) commercial paper and variable or
fixed rate notes issued by any Approved Bank (or by the parent company
thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by
S&P or P-1 (or the equivalent thereof) or better by Moody's and
maturing within six months of the date of acquisition, (d) repurchase
agreements with a bank or trust company (including any of the Lenders)
or securities dealer having capital and surplus in excess of
$500,000,000 for direct obligations issued by or fully guaranteed by
the United States of America in which a Credit Party shall have a
perfected first priority security interest (subject to no other Liens)
and having, on the date of purchase thereof, a fair market value of at
least 100% of the amount of the repurchase obligations and (e)
Investments, classified in accordance with GAAP as current assets, in
money market investment programs registered under the Investment
Company Act of 1940, as amended, which are administered by financial
institutions having capital of at least $500,000,000 and the portfolios
of which are limited to investments of the character described in the
foregoing subdivisions (a) through (d).
"Change of Control" means any of the following events:
(a) any "person" or "group" (within the meaning of Section
13(d) or 14(d) of the Exchange Act) has become, directly or indirectly,
the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act, except that a Person shall be deemed to have "beneficial
ownership" of all shares that any such Person has the right to acquire,
whether such right is exercisable immediately or only after the passage
of time or the occurrence of any contingency), by way of merger,
consolidation or otherwise, of 20% or more of the voting power of BRT
on a fully-diluted basis, after giving effect to the conversion and
exercise of all outstanding warrants, options and other securities of
BRT convertible into or exercisable for voting power of BRT (whether or
not such securities are then currently convertible or exercisable); or
(b) during any period of up to twelve (12) consecutive months
commencing on or after the Closing Date, individuals who were trustees
of BRT at the beginning of such period (the "Continuing Trustees"),
plus any new trustees whose election or appointment was approved by a
majority of the Continuing Trustees then in office, shall cease for any
reason to constitute a majority of the Board of Trustees of BRT; or
6
(c) BRT fails to directly own at least 75% of the aggregate
ownership interests in BOP (giving effect to any convertible interests
with respect thereto).
"Closing Date" means the date hereof.
"Code" means the Internal Revenue Code of 1986, as amended,
and any successor statute thereto, as interpreted by the rules and
regulations issued thereunder, in each case as in effect from time to
time. References to sections of the Code shall be construed also to
refer to any successor sections.
"Commitments" means (a) with respect to each Lender, the
Revolving Loan Commitment Percentage of such Lender multiplied by the
Revolving Committed Amount and (b) with respect to the Issuing Lender,
the LOC Commitment.
"Combined Parties" means the Credit Parties and their
Subsidiaries and all joint ventures or partnerships to which a Credit
Party or one of its Subsidiaries is a party.
"Credit Documents" means this Credit Agreement, the Notes, any
Notice of Borrowing, any Notice of Continuation/Conversion and all
other related agreements and documents issued or delivered hereunder or
thereunder or pursuant hereto or thereto.
"Credit Exposure" has the meaning set forth in the definition
of Required Lenders in this Section 1.1.
"Credit Parties" means the Borrowers and the Guarantors and
"Credit Party" means any one of them.
"Debt Payments" means, for any period, for the Combined
Parties, the sum of (a) Interest Expense for such period plus (b) all
payments of principal and any required prepayments on Funded Debt of
the Combined Parties (other than balloon payments) for such period,
ending on the date of determination (including the principal component
of payments due on Capital Leases during the applicable period ending
on the date of determination).
"Debt Service Coverage Ratio" means the ratio of (a)
Annualized Modified Adjusted NOI to (b) the Market Funded Debt
Payments.
"Default" means any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that, (a)
has failed to make a Loan or purchase a Participation Interest required
pursuant to the terms of this Credit Agreement (but only for so long as
such Loan is not made or such Participation Interest is not purchased),
(b) has failed to pay to the Administrative Agent or any Lender an
amount owed by such Lender pursuant to the terms of this Credit
Agreement (but only for so long as such amount has not been repaid) or
(c) has been deemed insolvent or has become subject to a bankruptcy or
insolvency proceeding or to a receiver, trustee or similar official.
"Dollars" and "$" each means the lawful currency of the United
States of America.
"Effective Date" means the date, as specified by the
Administrative Agent, on which the conditions set forth in Section 5.1
shall have been fulfilled (or waived in the sole discretion of the
Lenders) and on which the initial Loans shall have been made and/or the
initial Letters of Credit shall have been issued.
"Eligible Assignee" means (a) any Lender or any Affiliate of a
Lender and (b) any other commercial bank, financial institution,
institutional lender or "accredited investor" (as defined in Regulation
D of the Securities and Exchange Commission) consented to by the
Borrowers and the Administrative Agent (such consent not to be
unreasonably withheld or delayed); provided that the consent of the
Borrowers shall not be required upon the occurrence and during the
continuation of an Event of Default. Neither a Borrower nor any
Affiliate of the Borrowers shall qualify as an Eligible Assignee.
7
"Environmental Claim" means any investigation, written notice,
violation, written demand, written allegation, action, suit,
injunction, judgment, order, consent decree, penalty, fine, lien,
proceeding, or written claim whether administrative, judicial or
private in nature arising (a) pursuant to, or in connection with, an
actual or alleged violation of any Environmental Law, (b) in connection
with any Hazardous Material, (c) from any assessment, abatement,
removal, remedial, corrective, or other response action in connection
with an Environmental Law or other order of a Governmental Authority or
(d) from any actual or alleged damage, injury, threat, or harm to
health, safety, natural resources, or the environment.
"Environmental Laws" means any current or future legal
requirement of any Governmental Authority pertaining to (a) the
protection of health, safety, and the indoor or outdoor environment,
(b) the conservation, management, or use of natural resources and
wildlife, (c) the protection or use of surface water and groundwater or
(d) the management, manufacture, possession, presence, use, generation,
transportation, treatment, storage, disposal, release, threatened
release, abatement, removal, remediation or handling of, or exposure
to, any hazardous or toxic substance or material or (e) pollution
(including any release to land surface water and groundwater) and
includes, without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986, 42 USC 9601 et seq., Solid
Waste Disposal Act, as amended by the Resource Conservation and
Recovery Act of 1976 and Hazardous and Solid Waste Amendment of 1984,
42 USC 6901 et seq., Federal Water Pollution Control Act, as amended by
the Clean Water Act of 1977, 33 USC 1251 et seq., Clean Air Act of
1966, as amended, 42 USC 7401 et seq., Toxic Substances Control Act of
1976, 15 USC 2601 et seq., Hazardous Materials Transportation Act, 49
USC App. 1801 et seq., Occupational Safety and Health Act of 1970, as
amended, 29 USC 651 et seq., Oil Pollution Act of 1990, 33 USC 2701 et
seq., Emergency Planning and Community Right-to-Know Act of 1986, 42
USC 11001 et seq., National Environmental Policy Act of 1969, 42 USC
4321 et seq., Safe Drinking Water Act of 1974, as amended, 42 USC
300(f) et seq., any analogous implementing or successor law, and any
amendment, rule, regulation, order, or directive issued thereunder.
"Equity Issuance" means any issuance by a Credit Party to any
Person (other than another Credit Party) of shares of its capital
stock, preferred stock, common or preferred shares of beneficial
interest, partnership or membership interests or other equity
interests, including pursuant to the exercise of options or warrants or
pursuant to the conversion of any debt securities to equity; provided
that the definition of Equity Issuance as used herein shall not include
(a) issuances of equity to employees of a Credit Party to the extent
such issuances do not exceed $1,000,000 in any one instance or
$5,000,000, in the aggregate, during the term of this Credit Agreement
or (b) issuances of common stock or common beneficial interests for the
sole purpose of conversion or redemption of convertible preferred stock
or perpetual preferred stock or preferred beneficial interests.
8
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto, as interpreted by
the rules and regulations thereunder, all as the same may be in effect
from time to time. References to sections of ERISA shall be construed
also to refer to any successor sections.
"ERISA Affiliate" means an entity, whether or not
incorporated, which is under common control with a Borrower or any of
its Subsidiaries within the meaning of Section 4001(a)(14) of ERISA, or
is a member of a group which includes a Credit Party or any Subsidiary
of a Credit Party and which is treated as a single employer under
subsections (b) or (c) of Section 414 of the Code.
"ERISA Event" means (i) with respect to any Plan, the
occurrence of a Reportable Event or the substantial cessation of
operations (within the meaning of Section 4062(e) of ERISA); (ii) the
withdrawal of a Credit Party, any Subsidiary of a Credit Party or any
ERISA Affiliate from a Multiple Employer Plan during a plan year in
which it was a substantial employer (as such term is defined in Section
4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan;
(iii) the distribution of a notice of intent to terminate or the actual
termination of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA;
(iv) the institution of proceedings to terminate or the actual
termination of a Plan by the PBGC under Section 4042 of ERISA; (v) any
event or condition which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Plan; (vi) the complete or partial withdrawal of a
Credit Party, any Subsidiary of a Credit Party or any ERISA Affiliate
from a Multiemployer Plan; (vii) the conditions for imposition of a
lien under Section 302(f) of ERISA exist with respect to any Plan; or
(viii) the adoption of an amendment to any Plan requiring the provision
of security to such Plan pursuant to Section 307 of ERISA.
"Eurodollar Loan" means a Loan bearing interest based on a
rate determined by reference to the Adjusted Eurodollar Rate.
"Eurodollar Rate" means, for the Interest Period for each
Eurodollar Loan comprising part of the same borrowing (including
conversions, extensions and renewals), a per annum interest rate
determined pursuant to the following formula:
Eurodollar Rate = London Interbank Offered Rate
---------------------------------
1 - Eurodollar Reserve Percentage
"Eurodollar Reserve Percentage" means, for any day, that
percentage (expressed as a decimal) which is in effect from time to
time under Regulation D as the maximum reserve requirement (including,
without limitation, any basic, supplemental, emergency, special, or
marginal reserves) applicable with respect to Eurodollar liabilities as
that term is defined in Regulation D (or against any other category of
liabilities that includes deposits by reference to which the interest
rate on Eurodollar Loans is determined) with respect to member banks of
the Federal Reserve System, whether or not any Lender has any
Eurodollar liabilities subject to such reserve requirement at that
time. Eurodollar Loans shall be deemed to constitute Eurodollar
liabilities and as such shall be deemed subject to reserve requirements
without benefits of credits for proration, exceptions or offsets that
may be available from time to time to a Lender. The Adjusted Eurodollar
Rate shall be adjusted automatically on and as of the effective date of
any change in the Eurodollar Reserve Percentage.
9
"Event of Default" means any of the events or circumstances
described in Section 9.1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, modified, succeeded or replaced from time to time, and the
rules and regulations promulgated thereunder.
"Excluded Material Subsidiaries" means the Material
Subsidiaries set forth on Schedule 6.25.
"Existing Credit Agreement" has the meaning set forth in the
Recitals hereto.
"Existing Letters of Credit" means the letters of credit
described on Schedule 2.2(c).
"Extension of Credit" means, as to any Lender, the making of a
Loan by such Lender (or a participation therein by a Lender) or the
issuance of, or participation in, a Letter of Credit by such Lender.
"Facility Fees" means the fees payable to the Lenders pursuant
to Section 3.4(a)(ii).
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, at the discretion of the Administrative Agent, to the
nearest 1/100th of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day
next succeeding such day; provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Business Day and (b) if no such
rate is so published on such next preceding Business Day, the Federal
Funds Rate for such day shall be the average rate quoted to the
Administrative Agent on such day on such transactions as determined by
the Administrative Agent.
"Fee Letter" means that certain letter agreement, dated as of
May 24, 2001, between the Administrative Agent and BRT, as amended,
modified, supplemented or replaced from time to time.
"Fitch" means Fitch IBCA or any successor or assignee of the
business of such company in the business of rating securities.
"Fixed Charge Coverage Ratio" means, for any period, the ratio
of (a) Adjusted NOI for such period to (b) the sum of Debt Payments for
such period plus all dividends on preferred stock for such period plus
any letter of credit fees for such period.
10
"Funded Debt" means, without duplication, the sum of (a) all
Indebtedness of the Combined Parties for borrowed money, (b) all
purchase money Indebtedness of the Combined Parties, (c) the principal
portion of all obligations of the Combined Parties under Capital
Leases, (d) all obligations, contingent or otherwise, relative to the
face amount of all letters of credit (other than letters of credit
supporting trade payables in the ordinary course of business), whether
or not drawn, and banker's acceptances issued for the account or upon
the application of a Combined Party (it being understood that, to the
extent an undrawn letter of credit supports another obligation
constituting Indebtedness, in calculating aggregated Funded Debt only
such other obligation shall be included), (e) all Guaranty Obligations
of the Combined Parties with respect to the indebtedness of another
Person of the types described in this definition, (f) all indebtedness
of another Person of the types described in this definition that is
secured by a Lien on any property of the Combined Parties whether or
not such indebtedness has been assumed by a Combined Party, (g) all
indebtedness of the types described in this definition of any
partnership or unincorporated joint venture to the extent a Combined
Party is legally obligated or has a reasonable expectation of being
liable with respect thereto, net of any assets of such partnership or
joint venture, (h) the principal balance outstanding under any
synthetic lease, tax retention operating lease, off-balance sheet loan
or similar off-balance sheet financing product of a Combined Party
where such transaction is considered borrowed money indebtedness for
tax purposes but is classified as an operating lease in accordance with
GAAP, (i) all obligations of the Combined Parties in respect of
interest rate protection agreements, foreign currency exchange
agreements or other interest or exchange rate or commodity price
hedging agreements and (j) all take out loan commitments to the extent
such take out commitment is not supported by a financial commitment
from a third party containing standard terms and conditions. The
calculation of Funded Debt of the Combined Parties shall be subject to
Section 1.4.
"Funds From Operations", when used with respect to any Person,
shall have the meaning given to such term in, and shall be calculated
in accordance with, standards promulgated by the National Association
of Real Estate Investment Trusts in effect from time to time.
"GAAP" means generally accepted accounting principles in the
United States applied on a consistent basis and subject to Section 1.3.
"Governmental Authority" means any Federal, state, local or
provincial court or governmental agency, authority, instrumentality or
regulatory body.
"Guarantors" means (a) the Material Subsidiaries of the
Borrowers, as of the Closing Date, other than the Excluded Material
Subsidiaries and (b) such other Persons who may from time to time
execute a Joinder Agreement (or otherwise consent in writing to
becoming a Guarantor hereunder), as required by Section 7.12 or
otherwise, in each case together with their successors and assigns.
11
"Guaranty" means the guaranty of payment provided by the
Guarantors pursuant to Section 4.
"Guaranty Obligations" means, with respect to any Person,
without duplication, any obligations (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or
collection) guaranteeing or intended to guarantee any Indebtedness of
any other Person in any manner, whether direct or indirect, and
including without limitation any obligation, whether or not contingent,
(a) to purchase any such Indebtedness or other obligation or any
property constituting security therefor, (b) to advance or provide
funds or other support for the payment or purchase of such indebtedness
or obligation or to maintain working capital, solvency or other balance
sheet condition of such other Person (including, without limitation,
maintenance agreements, comfort letters, take or pay arrangements, put
agreements or similar agreements or arrangements) for the benefit of
the holder of Indebtedness of such other Person, (c) to lease or
purchase property, securities or services primarily for the purpose of
assuring the owner of such Indebtedness or (d) to otherwise assure or
hold harmless the owner of such Indebtedness or obligation against loss
in respect thereof. The amount of any Guaranty Obligation hereunder
shall (subject to any limitations set forth therein) be deemed to be an
amount equal to the outstanding principal amount (or maximum principal
amount, if larger) of the Indebtedness in respect of which such
Guaranty Obligation is made. It is understood and agreed that for
purposes of any "completion guaranty" provided by a Credit Party or one
of its Subsidiaries, the amount of Indebtedness associated with such
completion guaranty shall be none unless such completion guaranty is
enforced (or written notice of the intent to enforce such completion
guaranty has been received) at which time the Indebtedness associated
with such completion guaranty shall equal the remaining cost to
complete the project plus ten percent until such time as a certificate
of occupancy is issued.
"Hazardous Materials" means any substance, material or waste
defined or regulated in or under any Environmental Laws.
"Incentive Stock Plan" means the BRT 1997 Long-Term Incentive
Plan, as amended from time to time, and any other equity incentive plan
hereafter established by BRT or one of its Subsidiaries pursuant to
which awards of equity interests in BRT or such Subsidiary may be made
to employees of BRT or one of its Subsidiaries.
12
"Indebtedness" of any Person means, without duplication, (a)
all obligations of such Person for borrowed money, (b) all obligations
of such Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily made (c)
all obligations of such Person under conditional sale or other title
retention agreements relating to property purchased by such Person to
the extent of the value of such property (other than customary
reservations or retentions of title under agreements with suppliers
entered into in the ordinary course of business), (d) all obligations,
other than intercompany items, of such Person issued or assumed as the
deferred purchase price of property or services purchased by such
Person which would appear as liabilities on a balance sheet of such
Person, (e) all Indebtedness of others secured by (or for which the
holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on, or payable out of the
proceeds of production from, property owned or acquired by such Person,
whether or not the obligations secured thereby have been assumed, (f)
all Guaranty Obligations of such Person, (g) the principal portion of
all obligations of such Person under (i) Capital Leases and (ii) any
synthetic lease, tax retention operating lease, off-balance sheet loan
or similar off-balance sheet financing product of such Person where
such transaction is considered borrowed money indebtedness for tax
purposes but is classified as an operating lease in accordance with
GAAP, (h) all obligations of such Person in respect of interest rate
protection agreements, foreign currency exchange agreements, or other
interest or exchange rate or commodity price hedging agreements, (i)
the maximum amount of all performance and standby letters of credit
issued or bankers' acceptances facilities created for the account or
upon the application of such Person and, without duplication, all
drafts drawn thereunder (to the extent unreimbursed), (j) all preferred
stock issued by such Person and required by the terms thereof to be
redeemed, or for which mandatory sinking fund payments are due, by a
fixed date; provided that Indebtedness shall not include outstanding
convertible preferred stock which carries a defined term if its
conversion or redemption occurs solely through the issuance of
additional equity or from the proceeds of an equity offering, (k) all
obligations evidenced by take out commitments, (l) the aggregate amount
of uncollected accounts receivables of such Person subject at such time
to a sale of receivables (or similar transaction) regardless of whether
such transaction is effected without recourse to such Person or in a
manner that would not be reflected on the balance sheet of such Person
in accordance with GAAP and (m) all obligations of such Person to
repurchase any securities which repurchase obligation is related to the
issuance thereof, including, without limitation, obligations commonly
known as residual equity appreciation potential shares. Subject to the
terms of Section 1.4, the Indebtedness of any Person shall include the
Indebtedness of any partnership or unincorporated joint venture in
which such Person is legally obligated or has a reasonable expectation
of being liable with respect thereto.
"Initial Revolving Loan Maturity Date" means June 29, 2004.
13
"Interest Coverage Ratio" means, for any period, the ratio of
(a) Adjusted NOI for such period to (b) Interest Expense for such
period.
"Interest Expense" means, for any period, with respect to the
Combined Parties, all net interest expense, whether paid or accrued
(including that portion applicable to Capital Leases in accordance with
GAAP) plus capitalized interest.
"Interest Payment Date" means (a) as to Base Rate Loans, the
last Business Day of each month and the Revolving Loan Maturity Date,
(b) as to any Eurodollar Loan having an Interest Period of three months
or less, the last day of such Interest Period and the Revolving Loan
Maturity Date, and (c) as to any Eurodollar Loan having an Interest
Period longer than three months, the day which is three months after
the first day of such Interest Period, the last day of such Interest
Period, and the Revolving Loan Maturity Date.
"Interest Period" means, as to Eurodollar Loans, a period of
one, two, three or six months' duration as the Borrowers may elect,
commencing, in each case, on the date of the borrowing (including
continuations and conversions thereof); provided, however, (a) if any
Interest Period would end on a day which is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day
(except that where the next succeeding Business Day falls in the next
succeeding calendar month, then on the next preceding Business Day),
(b) no Interest Period shall extend beyond the Revolving Loan Maturity
Date, (c) where an Interest Period begins on a day for which there is
no numerically corresponding day in the calendar month in which the
Interest Period is to end, such Interest Period shall end on the last
Business Day of such calendar month, and (d) no Interest Period shall
extend beyond the Initial Revolving Loan Maturity Date unless the
Revolving Loan Maturity Date has been extended pursuant to Section
3.5(b).
"Investment" in any Person means (a) the acquisition (whether
for cash, property, services, assumption of Indebtedness, securities or
otherwise) of assets, shares of capital stock, bonds, notes,
debentures, partnership interests, membership interests, joint ventures
or other ownership interests or other securities of such other Person
or (b) any deposit with, or advance, loan or other extension of credit
to, such Person (other than deposits made in connection with the
purchase of equipment or other assets in the ordinary course of
business) or (c) any other capital contribution to or investment in
such Person, including, without limitation, any Guaranty Obligation
(including any support for a letter of credit issued on behalf of such
Person) incurred for the benefit of such Person.
"Investment Grade Rating" means an Unsecured Senior Debt
Rating of (a) BBB- or better from S&P, (b) Baa3 or better from Moody's
or (c) BBB- or better from Fitch, as applicable.
14
"Issuing Lender" means Bank of America, any successor
Administrative Agent or any other Lender designated by the
Administrative Agent.
"Issuing Lender Fees" has the meaning set forth in Section
3.4(b)(ii).
"Joinder Agreement" means a Joinder Agreement substantially in
the form of Exhibit 7.12.
"Lender" means any of the Persons identified as a "Lender" on
the signature pages hereto, and any Person which may become a Lender by
way of assignment in accordance with the terms hereof, together with
their successors and permitted assigns.
"Letter of Credit" means a letter of credit issued for the
account of a Credit Party by the Issuing Lender pursuant to Section 2.2
or any Existing Letter of Credit, as such letter of credit may be
amended, modified, extended, renewed or replaced.
"Letter of Credit Fees" has the meaning set forth in Section
3.4(b)(i).
"Leverage Ratio" means the ratio of (a) Funded Debt to (b) the
sum of (i) Annualized Capitalized Modified Adjusted NOI plus (ii) all
unrestricted cash of the Combined Parties plus (iii) all Cash
Equivalents of the Combined Parties plus (iv) all tenant security
deposits held by the Combined Parties plus (v) all amounts of the
Combined Parties invested in construction-in-process plus (vi) all
mortgage notes receivable of the Combined Parties plus (vii) all net
cash investments in opportunity funds of the Combined Parties.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference, priority or charge of any kind, including,
without limitation, any agreement to give any of the foregoing, any
conditional sale or other title retention agreement, and any lease in
the nature thereof.
"Loan" or "Loans" means the Revolving Loans (or a portion of
any Revolving Loan), individually or collectively, as appropriate.
"LOC Commitment" means the commitment of the Issuing Lender to
issue Letters of Credit for the account of any Credit Party or any of
its Subsidiaries in an aggregate face amount any time outstanding
(together with the amounts of any unreimbursed drawings thereon) of up
to the LOC Committed Amount.
"LOC Committed Amount" means SIXTY FIVE MILLION DOLLARS
($65,000,000).
15
"LOC Documents" means, with respect to any Letter of Credit,
such Letter of Credit, any amendments thereto, any documents delivered
in connection therewith, any application therefor, and any agreements,
instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or
providing for (a) the rights and obligations of the parties concerned
or at risk or (b) any collateral security for such obligations.
"LOC Obligations" means, at any time, the sum, without
duplication, of (a) the maximum amount which is, or at any time
thereafter may become, available to be drawn under Letters of Credit
then outstanding, assuming compliance with all requirements for
drawings referred to in such Letters of Credit plus (b) the aggregate
amount of all drawings under Letters of Credit honored by an Issuing
Lender but not theretofore reimbursed.
"LOC Participants" means the Lenders.
"London Interbank Offered Rate" means, for any Eurodollar Loan
for any Interest Period therefor, the rate per annum (rounded upwards,
at the discretion of the Administrative Agent, to the nearest 1/100 of
1%) appearing on Telerate Page 3750 as the London interbank offered
rate for deposits in Dollars at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of such Interest Period for a
term comparable to such Interest Period; provided, however, if more
than one rate is specified on Telerate Page 3750, the applicable rate
shall be the arithmetic mean of all such rates. If for any reason such
rate is not available, the term "London Interbank Offered Rate" shall
mean, for any Eurodollar Loan for any Interest Period therefor, the
rate per annum (rounded upwards, at the discretion of the
Administrative Agent, to the nearest 1/100 of 1%) appearing on Reuters
Screen LIBO Page as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period for a term comparable to
such Interest Period; provided, however, if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates.
"Mandatory Borrowing" has the meaning set forth in Section
2.2(e).
"Market Funded Debt Payments" means the scheduled debt
payments that would have been due during a twelve month period with
respect to the Funded Debt of the Combined Parties as of the last day
of the prior fiscal quarter assuming a principal mortgage amortization
of 25 years and assuming the Market Interest Rate as in effect on the
date that the Market Funded Debt Payments are calculated.
16
"Market Interest Rate" means an interest rate equal to the
greater of (a) the prior 30 day average of the most recent seven year
U.S. Treasury Note plus 2.00% per annum or (b) 8.50% per annum.
"Material Adverse Effect" means a material adverse effect on
(a) the business, assets, operations, condition (financial or
otherwise) or prospects of BRT, BOP or the Credit Parties and their
Subsidiaries taken as a whole, (b) the ability of a Credit Party to
perform its respective obligations under this Credit Agreement or any
of the other Credit Documents, or (c) the validity or enforceability of
this Credit Agreement, any of the other Credit Documents, or the rights
and remedies of the Lenders hereunder or thereunder taken as a whole.
"Material Subsidiary" means a Subsidiary of a Credit Party in
which such Credit Party owns, directly or indirectly, more than 65% of
the capital stock, partnership interests, membership interests or other
equity interests; provided that with respect to a Subsidiary of a
Credit Party that is not a corporation and whose ownership interest is
not otherwise specified, such percentage interest shall be the Capital
Percentage of such Credit Party in such Subsidiary.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., or any
successor or assignee of the business of such company in the business
of rating securities.
"Multiemployer Plan" means a Plan which is a multiemployer
plan as defined in Section 3(37) or Section 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan (other than a
Multiemployer Plan) in which a Credit Party, a Subsidiary of a Credit
Party or any ERISA Affiliate and at least one employer other than a
Credit Party, a Subsidiary of a Credit Party or any ERISA Affiliate are
contributing sponsors.
"Net Cash Proceeds" means, with respect to an Equity Issuance,
the gross cash proceeds received from such Equity Issuance minus actual
transaction costs payable to third parties in connection therewith.
"Net Income" means, for any period, the net income for such
period of the Combined Parties, as determined in accordance with GAAP.
"Net Worth" means, as of any date, the net worth of Credit
Parties and their Subsidiaries on a consolidated basis, as determined
in accordance with GAAP.
17
"NOI" means, for any period, an amount equal to (a) Net Income
for such period (excluding the effect of any extraordinary or other
non-recurring gains or losses or other non-cash losses outside the
ordinary course of business) plus (b) an amount which in the
determination of Net Income for such period has been deducted for (i)
proceeds to minority interests, (ii) income taxes, (iii) depreciation
and amortization and (iv) Interest Expense, less (c) to the extent not
previously deducted in calculating Net Income for such period, the
greater of (i) actual management fee expenditures of the Combined
Parties or (ii) 3% of the total real estate revenue of the Combined
Parties.
"Non-Excluded Taxes" has the meaning set forth in Section
3.13.
"Note" or "Notes" means the Revolving Notes, individually or
collectively, as appropriate.
"Notice of Borrowing" means a request by the Borrowers for a
Revolving Loan, in the form of Exhibit 2.1(b).
"Notice of Continuation/Conversion" means a request by the
Borrowers to continue an existing Eurodollar Loan to a new Interest
Period or to convert a Eurodollar Loan to a Base Rate Loan or to
convert a Base Rate Loan to a Eurodollar Loan, in the form of Exhibit
2.1(e).
"Obligations" means, without duplication, all of the
obligations of the Credit Parties to the Lenders and the Administrative
Agent, whenever arising, under this Credit Agreement, the Notes or any
of the other Credit Documents to which a Credit Party is a party.
"Participation Interest" means the Extension of Credit by a
Lender by way of a purchase of a participation in any Loans as provided
in Section 3.8 or in any Letters of Credit or LOC Obligations as
provided in Section 2.2.
"PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA and any
successor thereto.
18
"Permitted Investments" means, subject in all cases to
Sections 7.10, 7.15 and 8.5(b), Investments which are (a) cash or Cash
Equivalents, (b) accounts receivable created, acquired or made in the
ordinary course of business and payable or dischargeable in accordance
with customary trade terms, (c) Investments by one Credit Party in
another Credit Party, (d) the acquisition of new Properties; provided
that the Credit Parties may not invest in undeveloped land in excess of
5% of Total Assets, in the aggregate, except for such undeveloped land
that is adjacent to or contiguous with other assets being acquired or
assets already owned or if such land is part of a construction project
approved by the Required Lenders, has all necessary local permits and
approvals and construction will commence within six months of
acquisition, (e) ▇▇▇▇▇▇▇ money and similar deposits in respect of
Properties made in the ordinary course of business, (f) Investments in
Subsidiaries which are not Credit Parties and Investments in joint
ventures (whether or not Subsidiaries) not to exceed, in the aggregate
at any one time, 15% of Adjusted Total Assets and (g) Investments not
otherwise described in or covered by the other subclauses of this
definition including, without limitation, loans to officers, directors
and employees and repurchases of its capital stock or shares of
beneficial interest (including the repurchase of stock or shares of
beneficial interest that is retired, cancelled or terminated) or other
ownership interests (including options, warrants and stock appreciation
rights) by a Borrower or any Subsidiary); provided that (i) such
Investments do not exceed, in the aggregate at any one time, 10% of
Adjusted Total Assets and (ii) such Investments, together with the
Investments referred to in the previous subclause (f), do not exceed
(in the aggregate at any one time) 20% of Adjusted Total Assets.
"Permitted Liens" means (a) Liens securing Obligations, (b)
Liens for taxes not yet due or Liens for taxes being contested in good
faith by appropriate proceedings for which adequate reserves determined
in accordance with GAAP have been established (and as to which the
property subject to any such Lien is not yet subject to foreclosure,
sale or loss on account thereof), (c) Liens in respect of property
imposed by law arising in the ordinary course of business such as
materialmens', mechanics', warehousemens', carriers', landlords' and
other nonconsensual statutory Liens which are not yet due and payable
or which are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP have
been established (and as to which the property subject to any such Lien
is not yet subject to foreclosure, sale or loss on account thereof);
(d) Liens arising from good faith deposits in connection with or to
secure performance of tenders, bids, leases, government contracts,
performance and return-of-money bonds and other similar obligations
incurred in the ordinary course of business (other than obligations in
respect of the payment of borrowed money), (e) Liens arising from good
faith deposits in connection with or to secure performance of statutory
obligations and surety and appeal bonds, (f) easements, rights-of-way,
restrictions (including zoning restrictions), matters of plat, minor
defects or irregularities in title and other similar charges or
encumbrances not, in any material respect, impairing the use of the
encumbered property for its intended purposes, (g) judgment Liens that
would not constitute an Event of Default, (h) Liens arising by virtue
of any statutory or common law provision relating to bankers' liens,
rights of setoff or similar rights as to deposit accounts or other
funds maintained with a creditor depository institution, (i) Liens in
connection with Indebtedness permitted by Section 8.1(d); provided that
if such Lien is created with respect to a Unsecured Property, the
Borrowers shall give the Administrative Agent, within five Business
Days after the creation of such Lien, written notice of the creation of
such Lien and a certificate of the chief financial officer or chief
executive officer of BRT showing that, after giving effect to such
Lien, (A) the Credit Parties shall be in compliance on a Pro Forma
Basis with the financial covenants set forth in Section 7.2 and (B) no
Default or Event of Default shall exist and (j) Liens existing on the
date hereof and identified on Schedule 8.2; provided that no such Lien
shall extend to any property other than the property subject thereto on
the Closing Date.
19
"Person" means any individual, partnership, joint venture,
firm, corporation, limited liability company, association, trust or
other enterprise (whether or not incorporated), or any Governmental
Authority.
"Plan" means any employee benefit plan (as defined in Section
3(3) of ERISA) which is covered by ERISA and with respect to which a
Credit Party, any Subsidiary of a Credit Party or any ERISA Affiliate
is (or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an "employer" within the meaning of
Section 3(5) of ERISA.
"▇▇▇▇▇▇▇▇ Transaction" means the series of related
transactions pursuant to documents executed and delivered by BOP and
certain of its Affiliates on March 14, 2001 with ▇▇▇▇▇▇▇▇ Properties
Acquisition Partners, L.P., a Delaware limited partnership, and certain
of its Affiliates.
"Prime Rate" means the per annum rate of interest established
from time to time by the Person that is the Administrative Agent at its
principal offices (or such other principal office of such Person as
communicated in writing to the Borrowers and the Lenders) as its Prime
Rate. Any change in the interest rate resulting from a change in the
Prime Rate shall become effective at the opening of business on the day
specified in the public announcement of such change. The Prime Rate is
a rate set by the Person that is the Administrative Agent based upon
various factors including such Person's costs and desired return,
general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above
or below such announced rate.
"Pro Forma Basis" means with respect to (a) the sale of a
Property or the sale of an equity interest in a Credit Party, (b) the
creation of a Lien on a Property or (c) the acquisition of or
Investment in a Property or other asset that is subject to Section
7.15, that such sale, creation of Lien, acquisition or Investment shall
be deemed to have occurred as of the first day of the four fiscal
quarter period ending as of the last day of the most recent fiscal
quarter for which the Lenders have received the financial information
required by Section 7.1(b).
"Properties" means all real properties owned by the Credit
Parties and their Subsidiaries whether directly or through a joint
venture investment.
"Regulation D, O, T, U, or X" means Regulation D, O, T, U or
X, respectively, of the Board of Governors of the Federal Reserve
System (or any successor body) as from time to time in effect and any
successor to all or a portion thereof.
"REIT" means a real estate investment trust as defined in
Sections 856-860 of the Code.
20
"Reportable Event" means any of the events set forth in
Section 4043(c) of ERISA, other than those events as to which the
notice requirement has been waived by regulation.
"Required Lenders" means, at any time, the Lenders whose
aggregate Credit Exposure (as hereinafter defined) constitutes at least
66 2/3% of the Credit Exposure of all Lenders at such time; provided,
however, that if any Lender shall be a Defaulting Lender at such time
then there shall be excluded from the determination of Required Lenders
the aggregate principal amount of Credit Exposure of such Lender at
such time. For purposes of the preceding sentence, the term "Credit
Exposure" as applied to each Lender shall mean (a) at any time prior to
the termination of the Commitments, the Commitment of such Lender and
(b) at any time after the termination of the Commitments, the sum of
(i) the principal balance of the outstanding Loans of such Lender plus
(ii) such Lender's Participation Interests in the face amount of the
outstanding Letters of Credit.
"Requirement of Law" means, as to any Person, the articles or
certificate of incorporation and by-laws or other organizational or
governing documents of such Person, and any law, treaty, rule or
regulation or final, non-appealable determination of an arbitrator or a
court or other Governmental Authority, in each case applicable to or
binding upon such Person or to which any of its material property is
subject.
"Revolving Committed Amount" means FIVE HUNDRED MILLION
DOLLARS ($500,000,000) as the same may be permanently reduced in
accordance with Section 2.1(d).
"Revolving Loan Commitment Percentage" means, for each Lender,
the percentage identified as its Revolving Loan Commitment Percentage
on Schedule 1.1(a), as such percentage may be modified in connection
with any assignment made in accordance with the provisions of Section
11.3.
"Revolving Loan Maturity Date" means the Initial Revolving
Loan Maturity Date or, if extended by the Borrowers pursuant to Section
3.5(b), June 29, 2005.
"Revolving Loans" has the meaning set forth in Section 2.1(a).
"Revolving Note" or "Revolving Notes" means the promissory
notes of the Borrowers in favor of each of the Lenders evidencing the
Revolving Loans provided pursuant to Section 2.1, individually or
collectively, as appropriate, as such promissory notes may be amended,
modified, supplemented, extended, renewed or replaced from time to time
and in the form of Exhibit 2.1(g).
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., or any successor or assignee of the business of such
division in the business of rating securities.
21
"Secured Debt" means all Funded Debt of the Combined Parties
that is subject to a Lien in favor of the creditor holding such Funded
Debt; provided that any Funded Debt owed to the Lenders hereunder shall
be considered to be Unsecured Debt even if a Lien has been granted in
favor of the Lenders.
"Secured Debt Ratio" means the ratio of (a) Secured Debt to
(b) Annualized Capitalized Modified Adjusted NOI plus, to the extent
Secured Debt includes Funded Debt on construction-in-process, total
construction costs incurred as of such date with respect to such
construction-in-process.
"Securities Act" means the Securities Act of 1933, as amended,
modified, succeeded or replaced from time to time, and the rules and
regulations promulgated thereunder.
"Single Employer Plan" means any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan or a Multiple
Employer Plan.
"Solvent" means, with respect to any Person as of a particular
date, that on such date (a) such Person is able to pay its debts and
other liabilities, contingent obligations and other commitments as they
mature in the normal course of business, (b) such Person does not
intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and
liabilities mature in their ordinary course, (c) such Person is not
engaged in a business or a transaction, and is not about to engage in a
business or a transaction, for which such Person's assets would
constitute unreasonably small capital after giving due consideration to
the prevailing practice in the industry in which such Person is engaged
or is to engage, (d) the fair value of the assets of such Person is
greater than the total amount of liabilities, including, without
limitation, contingent liabilities, of such Person and (e) the present
fair saleable value of the assets of such Person is not less than the
amount that will be required to pay the probable liability of such
Person on its debts as they become absolute and matured. In computing
the amount of contingent liabilities at any time, it is intended that
such liabilities will be computed at the amount which, in light of all
the facts and circumstances existing at such time, represents the
amount that can reasonably be expected to become an actual or matured
liability.
"Subsidiary" means, as to any Person, (a) any corporation more
than 50% of whose stock of any class or classes having by the terms
thereof ordinary voting power to elect a majority of the directors of
such corporation (irrespective of whether or not at the time, any class
or classes of stock of such corporation shall have or might have voting
power by reason of the lapse of time or the happening of any
contingency) is at the time owned by such Person directly or indirectly
through Subsidiaries, and (b) any partnership, association, joint
venture, limited liability company, trust or other entity in which such
Person directly or indirectly through Subsidiaries has more than a 50%
equity interest or 50% Capital Percentage at any time.
22
"Termination Event" means (a) with respect to any Single
Employer Plan, the occurrence of a Reportable Event or the substantial
cessation of operations (within the meaning of Section 4062(e) of
ERISA); (b) the withdrawal of any Credit Party or any of its
Subsidiaries or any ERISA Affiliate from a Multiple Employer Plan
during a plan year in which it was a substantial employer (as such term
is defined in Section 4001(a)(2) of ERISA), or the termination of a
Multiple Employer Plan; (c) the distribution of a notice of intent to
terminate or the actual termination of a Plan pursuant to Section
4041(a)(2) or 4041A of ERISA; (d) the institution of proceedings to
terminate or the actual termination of a Plan by the PBGC under Section
4042 of ERISA; (e) any event or condition which might reasonably
constitute grounds under Section 4042 of ERISA for the termination of,
or the appointment of a trustee to administer, any Plan; or (f) the
complete or partial withdrawal of any Credit Party or any of its
Subsidiaries or any ERISA Affiliate from a Multiemployer Plan.
"Total Assets" means all assets of the Credit Parties and
their Subsidiaries on a consolidated basis, as determined in accordance
with GAAP.
"Unencumbered Cash Flow Ratio" means the ratio of (a)
Annualized Modified Adjusted NOI with respect to Unsecured Properties
to (b) Market Funded Debt Payments on Unsecured Debt.
"Unsecured Debt" means the sum of all Funded Debt of the
Combined Parties that was incurred, and continues to be outstanding,
without granting a Lien to the creditor holding such Funded Debt;
provided that all Funded Debt of the Combined Parties owing to the
Lenders under this Credit Agreement shall be considered to be Unsecured
Debt even if a Lien has been granted in favor of the Lenders.
"Unsecured Debt Ratio" means the ratio of (a) Annualized
Capitalized Modified Adjusted NOI with respect to all Unsecured
Properties to (b) Unsecured Debt.
"Unsecured Properties" means all Properties that are not
subject to a Lien other than (a) nonconsensual Permitted Liens and (b)
Liens in favor of the Lenders.
"Unsecured Senior Debt Rating" means the debt rating provided
by S&P, ▇▇▇▇▇'▇ or Fitch with respect to the unsecured, senior, long
term, non-credit enhanced debt of BRT or BOP.
"Unused Commitment" means, for any period, the amount by which
(a) the then applicable aggregate Revolving Committed Amount exceeds
(b) the daily average sum for such period of the aggregate principal
amount of all Revolving Loans outstanding plus the aggregate amount of
LOC Obligations outstanding.
23
"Unused Fees" means the fees payable to the Lenders pursuant
to Section 3.4(a)(i).
1.2 Computation of Time Periods and Other Definition Provisions.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding." References in this Credit Agreement to "Articles", "Sections",
"Schedules" or "Exhibits" shall be to Articles, Sections, Schedules or Exhibits
of or to this Credit Agreement unless otherwise specifically provided.
References in this Credit Agreement to "during the term of this Credit
Agreement" shall mean the period from the Effective Date to the earlier of the
Revolving Loan Maturity Date or the acceleration of the Loans pursuant to
Section 9.2.
1.3 Accounting Terms.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All financial statements delivered to the Lenders hereunder shall be
accompanied by a statement from the Borrowers that GAAP has not changed since
the most recent financial statements delivered by the Borrowers to the Lenders
or, if GAAP has changed, describing such changes in detail and explaining how
such changes affect the financial statements. All calculations made for the
purposes of determining compliance with this Credit Agreement shall (except as
otherwise expressly provided herein) be made by application of GAAP applied on a
basis consistent with the most recent annual or quarterly financial statements
delivered pursuant to Section 7.1 (or, prior to the delivery of the first
financial statements pursuant to Section 7.1, consistent with the financial
statements described in Section 5.1(f)); provided, however, if (a) the Borrowers
shall object to determining such compliance on such basis at the time of
delivery of such financial statements due to any change in GAAP or the rules
promulgated with respect thereto or (b) the Administrative Agent or the Required
Lenders shall so object in writing within 60 days after delivery of such
financial statements (or after the Lenders have been informed of the change in
GAAP affecting such financial statements, if later), then such calculations
shall be made on a basis consistent with the most recent financial statements
delivered by the Borrowers to the Lenders as to which no such objection shall
have been made.
24
1.4 Joint Venture Investments.
With respect to any ownership of a Property by a Credit Party or one of
its Subsidiaries through a joint venture (a) NOI, Adjusted NOI, Annualized
Modified Adjusted NOI, Annualized Capitalized Modified Adjusted NOI and Interest
Expense shall be determined in accordance with GAAP as applied to the Credit
Parties and their Subsidiaries on a consolidated basis and (b) Indebtedness and
Funded Debt shall be calculated as follows: (i) if the Indebtedness of such
joint venture is recourse to such Credit Party (or Subsidiary), then the amount
of such Indebtedness or Funded Debt that is recourse to such Credit Party (or
Subsidiary), and (ii) if the Indebtedness of such joint venture is not recourse
to such Credit Party (or Subsidiary), then such Credit Party's (or Subsidiary's)
interest in such Indebtedness or Funded Debt as determined by its Capital
Percentage. For purposes of this Section 1.4, Indebtedness of a joint venture
that is recourse to a Credit Party or one of its Subsidiaries solely as a result
of such Credit Party (or Subsidiary) being a partner or member in such joint
venture shall be treated as not recourse to such Credit Party (or Subsidiary) as
long as the only assets owned by such Credit Party (or Subsidiary) are its
equity interest in such joint venture and any contributed capital held to fund
such equity interest.
SECTION 2
CREDIT FACILITY
2.1 Revolving Loans.
(a) Revolving Loan Commitment. Subject to the terms and
conditions set forth herein, each Lender severally agrees to make
revolving loans (each a "Revolving Loan" and collectively the
"Revolving Loans") to the Borrowers, in Dollars, at any time and from
time to time, during the period from and including the Effective Date
to but not including the Revolving Loan Maturity Date or such earlier
date as the Revolving Committed Amount has been terminated as provided
herein; provided, however, that (i) the sum of the aggregate principal
amount of Revolving Loans outstanding plus the aggregate amount of LOC
Obligations outstanding shall not exceed the Revolving Committed
Amount, (ii) with respect to each individual Lender, such Lender's pro
rata share of outstanding Revolving Loans plus such Lender's pro rata
share of outstanding LOC Obligations shall not exceed such Lender's
Commitment, and (iii) the aggregate principal amount of Revolving Loans
advanced for construction and development of Properties shall not
exceed at any one time (A) for all such Properties that are less than
50% preleased, $50,000,000 and (B) for all such Properties,
$100,000,000. Subject to the terms of this Credit Agreement (including
Section 3.3), the Borrowers may borrow, repay and reborrow Revolving
Loans. The Administrative Agent shall keep a record of the purpose for
which each of the Loans was advanced (and of repayments applied
thereto), which record shall be conclusive absent prima facie error.
25
(b) Method of Borrowing for Revolving Loans. By no later than
11:00 a.m. (i) one Business Day prior to the date of the requested
borrowing of Revolving Loans that will be Base Rate Loans or (ii) three
Business Days prior to the date of the requested borrowing of Revolving
Loans that will be Eurodollar Loans, the Borrowers shall submit an
irrevocable written Notice of Borrowing in the form of Exhibit 2.1(b)
to the Administrative Agent setting forth (A) the amount requested, (B)
whether such Revolving Loans shall be Base Rate Loans or Eurodollar
Loans, (C) with respect to Revolving Loans that will be Eurodollar
Loans, the Interest Period applicable thereto, (D) the purpose of the
proceeds of the Revolving Loans and (E) a certification that the
Borrowers have complied in all respects with Section 5.2.
(c) Funding of Revolving Loans. Upon receipt of a Notice of
Borrowing, the Administrative Agent shall promptly inform the Lenders
as to the terms thereof. Each Lender shall make its Revolving Loan
Commitment Percentage of the requested Revolving Loans available to the
Administrative Agent by 1:00 p.m. on the date specified in the Notice
of Borrowing by deposit, in Dollars, of immediately available funds to
the Administrative Agent at its principal office in Charlotte, North
Carolina or at such other address as the Administrative Agent may
designate in writing. The amount of the requested Revolving Loans will
then be made available to the Borrowers by the Administrative Agent by
crediting the account of the Borrowers on the books of such office of
the Administrative Agent, to the extent the amount of such Revolving
Loans are made available to the Administrative Agent.
No Lender shall be responsible for the failure or delay by any
other Lender in its obligation to make Revolving Loans hereunder;
provided, however, that the failure of any Lender to fulfill its
obligations hereunder shall not relieve any other Lender of its
obligations hereunder. Unless the Administrative Agent shall have been
notified by any Lender prior to the date of any Revolving Loan that
such Lender does not intend to make available to the Administrative
Agent its portion of the Revolving Loans to be made on such date, the
Administrative Agent may assume that such Lender has made such amount
available to the Administrative Agent on the date of such Revolving
Loans, and the Administrative Agent in reliance upon such assumption,
may (in its sole discretion but without any obligation to do so) make
available to the Borrowers a corresponding amount. If such
corresponding amount is not in fact made available to the
Administrative Agent, the Administrative Agent shall be able to recover
such corresponding amount from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent will promptly notify the
Borrowers, and the Borrowers shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also
be entitled to recover from such Lender or the Borrowers, as the case
may be, interest on such corresponding amount in respect of each day
from the date such corresponding amount was made available by the
Administrative Agent to the Borrowers to the date such corresponding
amount is recovered by the Administrative Agent at a per annum rate
equal to (i) from the Borrowers at the applicable rate for such
Revolving Loan pursuant to the Notice of Borrowing and (ii) from such
Lender at the Federal Funds Rate.
26
(d) Reduction or Termination of Revolving Committed Amount.
Upon at least three Business Days' notice to the Administrative Agent,
the Borrowers shall have the right to permanently terminate or reduce
the aggregate unused amount of the Revolving Committed Amount at any
time or from time to time; provided that (i) each partial reduction
shall be in an aggregate amount at least equal to $5,000,000 and in
integral multiples of $1,000,000 above such amount and (ii) no
reduction shall be made which would reduce the Revolving Committed
Amount to an amount less than the aggregate amount of outstanding
Revolving Loans plus the aggregate amount of outstanding LOC
Obligations. Any reduction in (or termination of) the Revolving
Committed Amount shall be permanent and may not be reinstated. The
Administrative Agent shall immediately notify the Lenders of any
reduction in the Revolving Committed Amount.
(e) Continuations and Conversions. The Borrowers shall have
the option, on any Business Day, to continue existing Eurodollar Loans
for a subsequent Interest Period, to convert Base Rate Loans into
Eurodollar Loans, or to convert Eurodollar Loans into Base Rate Loans;
provided, however, that (i) each such continuation or conversion must
be requested by the Borrowers pursuant to a written Notice of
Continuation/Conversion, in the form of Exhibit 2.1(e), in compliance
with the terms set forth below, (ii) except as provided in Section
3.11, Eurodollar Loans may only be continued or converted on the last
day of the Interest Period applicable thereto, (iii) Eurodollar Loans
may not be continued nor may Base Rate Loans be converted into
Eurodollar Loans during the existence and continuation of a Default or
Event of Default and (iv) any request to continue a Eurodollar Loan
that fails to comply with the terms hereof or any failure to request a
continuation of a Eurodollar Loan at the end of an Interest Period
shall result in a conversion of such Eurodollar Loan to a Base Rate
Loan on the last day of the applicable Interest Period. Each
continuation or conversion must be requested by the Borrowers no later
than 11:00 a.m. (A) one Business Day prior to the date for a requested
conversion of a Eurodollar Loan to a Base Rate Loan or (B) three
Business Days prior to the date for a requested continuation of a
Eurodollar Loan or conversion of a Base Rate Loan to a Eurodollar Loan,
in each case pursuant to a written Notice of Continuation/Conversion
submitted to the Administrative Agent (which shall promptly notify each
of the Lenders) which shall set forth (x) whether the Borrowers wish to
continue or convert such Loans and (y) if the request is to continue a
Eurodollar Loan or convert a Loan to a Eurodollar Loan, the Interest
Period applicable thereto.
(f) Minimum Amounts/Restrictions on Loans. Each request for a
borrowing, conversion or continuation shall be subject to the
requirements that (i) each Eurodollar Loan shall be in a minimum amount
of $1,000,000 and in integral multiples of $100,000 in excess thereof,
(ii) each Base Rate Loan shall be in a minimum amount of $500,000 (and
integral multiples of $100,000 in excess thereof) or the remaining
amount available under the Revolving Committed Amount, (iii) no more
than six Loans shall be made during any one month and (iv) no more than
eight Eurodollar Loans shall be outstanding at any one time. For the
purposes of this Section 2.1(f), all Eurodollar Loans with the same
Interest Periods beginning on the same date shall be considered as one
Eurodollar Loan, but Eurodollar Loans with different Interest Periods,
even if they begin or end on the same date, shall be considered as
separate Eurodollar Loans.
(g) Notes. The Revolving Loans made by each Lender shall be
evidenced by a duly executed promissory note of the Borrowers to each
Lender in substantially the form of Exhibit 2.1(g).
27
2.2 Letter of Credit Subfacility.
(a) Issuance. Subject to the terms and conditions hereof and
of the LOC Documents, if any, and any other terms and conditions which
the Issuing Lender may reasonably require (so long as such terms and
conditions do not impose any financial obligation on or require any
Lien (not otherwise contemplated by this Credit Agreement) to be given
by any Credit Party or conflict with any obligation of, or detract from
any action which may be taken by, any Credit Party or its Subsidiaries
under this Credit Agreement), the Issuing Lender agrees, in reliance
upon the agreements of the other Lenders set forth in this Section 2.2,
from time to time upon request to issue (from the Effective Date to the
Revolving Loan Maturity Date and in a form reasonably acceptable to the
Issuing Lender), in Dollars, and the LOC Participants shall participate
in, Letters of Credit for the account of the Credit Parties or any of
their Subsidiaries; provided, however, that (i) the aggregate amount of
LOC Obligations shall not at any time exceed the LOC Committed Amount,
(ii) the sum of the aggregate amount of LOC Obligations outstanding
plus Revolving Loans outstanding shall not exceed the Revolving
Committed Amount and (iii) with respect to each individual LOC
Participant, such LOC Participant's pro rata share of outstanding
Revolving Loans plus its pro rata share of outstanding LOC Obligations
shall not exceed such LOC Participant's Commitment. The Issuing Lender
may require the issuance and expiry date of each Letter of Credit to be
a Business Day. Each Letter of Credit shall be either (x) a standby
letter of credit issued to support the obligations (including pension
or insurance obligations), contingent or otherwise, of a Credit Party
or any of its Subsidiaries, or (y) a commercial letter of credit in
respect of the purchase of goods or services by a Credit Party or any
of its Subsidiaries in the ordinary course of business. Except as
otherwise expressly agreed upon by all the LOC Participants, no Letter
of Credit shall have an original expiry date more than one year from
the date of issuance or shall have an expiry date that is less than 30
days prior to the Revolving Loan Maturity Date. Each Letter of Credit
shall comply with the related LOC Documents. Each Letter of Credit
shall be deemed to remain outstanding until it has expired or the
original documents evidencing such Letter of Credit have been returned
to the Issuing Lender.
(b) Notice and Reports. The request for the issuance of a
Letter of Credit shall be submitted to the Issuing Lender at least
three Business Days prior to the requested date of issuance. The
Issuing Lender will, at least quarterly and more frequently upon
request, provide to the Administrative Agent for dissemination to the
Lenders a detailed report specifying the Letters of Credit which are
then issued and outstanding and any activity with respect thereto which
may have occurred since the date of the prior report, and including
therein, among other things, the account party, the beneficiary, the
face amount, and the expiry date as well as any payments or expirations
which may have occurred. The Issuing Lender will further provide to the
Administrative Agent, promptly upon request, copies of the Letters of
Credit and the other LOC Documents.
(c) Participations.
--------------
(i) Each LOC Participant acknowledges and confirms
that it has a Participation Interest in the liability of the
Issuing Lender under each Existing Letter of Credit in an
amount equal to its Revolving Loan Commitment Percentage of
such Existing Letters of Credit. The Credit Parties'
reimbursement obligations in respect of each Existing Letter
of Credit, and each LOC Participant's obligations in
connection therewith, shall be governed by the terms of this
Credit Agreement.
28
(ii) Each LOC Participant, upon issuance of a Letter
of Credit, shall be deemed to have purchased without recourse
a risk participation from the Issuing Lender in such Letter of
Credit and each LOC Document related thereto and the rights
and obligations arising thereunder and any collateral relating
thereto, in each case in an amount equal to its Revolving Loan
Commitment Percentage of the obligations under such Letter of
Credit, and shall absolutely, unconditionally and irrevocably
assume, as primary obligor and not as surety, and be obligated
to pay to the Issuing Lender therefor and discharge when due,
its Revolving Loan Commitment Percentage of the obligations
arising under such Letter of Credit. Without limiting the
scope and nature of each LOC Participant's participation in
any Letter of Credit, to the extent that the Issuing Lender
has not been reimbursed as required hereunder or under any
such Letter of Credit, each such LOC Participant shall pay to
the Issuing Lender (without duplication of its obligations
under Sections 2.2(d) and 2.2(e) to make a Revolving Loan to
the Borrowers) its Revolving Loan Commitment Percentage of
such unreimbursed drawing in same day funds on the day of
notification by the Issuing Lender of an unreimbursed drawing
pursuant to the provisions of subsection (d) or (e) of this
Section 2.2. The obligation of each LOC Participant to so
reimburse the Issuing Lender shall be absolute and
unconditional and shall not be affected by the occurrence of a
Default, an Event of Default or any other occurrence or event.
Any such reimbursement shall not relieve or otherwise impair
the obligation of the Borrowers to reimburse the Issuing
Lender in respect of any Letter of Credit, together with
interest as hereinafter provided.
29
(d) Reimbursement. In the event of any drawing under any
Letter of Credit, the Issuing Lender will promptly notify the
Borrowers. Unless the Borrowers shall promptly notify the Issuing
Lender of their intent to otherwise reimburse the Issuing Lender, the
Borrowers shall be deemed to have requested a Revolving Loan at a per
annum rate equal to the Base Rate in the amount of such drawing, the
proceeds of which will be used to satisfy the reimbursement
obligations. The Borrowers shall reimburse the Issuing Lender on the
day of drawing under any Letter of Credit either with the proceeds of
such Revolving Loan obtained hereunder or otherwise in same day funds
as provided herein or in the LOC Documents. If the Borrowers shall fail
to reimburse the Issuing Lender as provided hereinabove, the
unreimbursed amount of such drawing shall bear interest at a per annum
rate equal to the Base Rate plus two percent (2%). The Borrowers'
reimbursement obligations hereunder shall be absolute and unconditional
under all circumstances irrespective of (but without waiver of) any
rights of set-off, counterclaim or defense to payment the applicable
account party or the Borrowers may claim or have against an Issuing
Lender, the Administrative Agent, the Lenders, the beneficiary of the
Letter of Credit drawn upon or any other Person, including without
limitation, any defense based on any failure of the applicable account
party or the Borrowers to receive consideration or the legality,
validity, regularity or unenforceability of such Letter of Credit. The
Issuing Lender will promptly notify the LOC Participants of the amount
of any unreimbursed drawing and each LOC Participant shall promptly pay
to the Issuing Lender, in Dollars and in immediately available funds,
the amount (without duplication of its obligations under Sections
2.2(d) and 2.2(e) to make a Revolving Loan to the Borrowers) of such
LOC Participant's Revolving Loan Commitment Percentage of such
unreimbursed drawing. Such payment shall be made on the day such notice
is received by such Lender from the Issuing Lender if such notice is
received at or before 2:00 p.m., otherwise such payment shall be made
at or before 12:00 Noon on the Business Day next succeeding the day
such notice is received. If such LOC Participant does not pay such
amount to the Issuing Lender in full upon such request, such LOC
Participant shall, on demand, pay to the Issuing Lender interest on the
unpaid amount during the period from the date such LOC Participant
received the notice regarding the unreimbursed drawing until such LOC
Participant pays such amount to the Issuing Lender in full at a rate
per annum equal to, if paid within two Business Days of the date of
drawing, the Federal Funds Rate and thereafter at a rate per annum
equal to the Base Rate. Each LOC Participant's obligation to make such
payment to the Issuing Lender, and the right of the Issuing Lender to
receive the same, shall be absolute and unconditional, shall not be
affected by any circumstance whatsoever and without regard to the
termination of this Credit Agreement or the Commitments hereunder, the
existence of a Default or Event of Default or the acceleration of the
obligations hereunder and shall be made without any offset, abatement,
withholding or reduction whatsoever. Simultaneously with the making of
each such payment by a LOC Participant to the Issuing Lender, such LOC
Participant shall, automatically and without any further action on the
part of the Issuing Lender or such LOC Participant, acquire a
participation in an amount equal to such payment (excluding the portion
of such payment constituting interest owing to the Issuing Lender) in
the related unreimbursed drawing portion of such LOC Obligation and in
the interest thereon and in the related LOC Documents, and shall have a
ratable interest in the Issuing Lender's claim against the Borrowers
with respect thereto.
30
(e) Repayment with Revolving Loans. On any day on which the
Borrowers shall have requested, or been deemed to have requested, a
Revolving Loan borrowing to reimburse a drawing under a Letter of
Credit (as set forth in clause (d) above), the Administrative Agent
shall give notice to the applicable Lenders that a Revolving Loan has
been requested or deemed requested in connection with a drawing under a
Letter of Credit, in which case a Revolving Loan comprised solely of
Base Rate Loans (each such borrowing, a "Mandatory Borrowing") shall be
immediately made from all applicable Lenders (without giving effect to
any termination of the Commitments pursuant to Section 9.2) pro rata
based on each Lender's respective Revolving Loan Commitment Percentage
and the proceeds thereof shall be paid directly to the Issuing Lender
for application to the respective LOC Obligations. Each such Lender
hereby irrevocably agrees to make such Revolving Loans immediately upon
any such request or deemed request on account of each such Mandatory
Borrowing in the amount and in the manner specified in the preceding
sentence and on the same such date notwithstanding (i) the amount of
such Mandatory Borrowing may not comply with the minimum amount for
borrowings of Revolving Loans otherwise required hereunder, (ii)
whether any conditions specified in Section 5.2 are then satisfied,
(iii) whether a Default or Event of Default then exists, (iv) failure
of any such request or deemed request for Revolving Loans to be made by
the time otherwise required hereunder, (v) the date of such Mandatory
Borrowing, or (vi) any reduction in the Revolving Committed Amount or
any termination of the Commitments. In the event that any Mandatory
Borrowing cannot for any reason be made on the date otherwise required
above (including, without limitation, as a result of the commencement
of a proceeding under the Bankruptcy Code with respect to a Credit
Party), then each Lender hereby agrees that it shall forthwith fund (as
of the date such Mandatory Borrowing would otherwise have occurred, but
adjusted for any payments received from the Borrowers on or after such
date and prior to such purchase) its Participation Interest in the
outstanding LOC Obligations; provided, further, that in the event any
Lender shall fail to fund its Participation Interest on the day such
Mandatory Borrowing would otherwise have occurred, then the amount of
such Lender's unfunded Participation Interest therein shall bear
interest payable to the Issuing Lender upon demand, at a rate per annum
equal to, if paid within two Business Days of such date, the Federal
Funds Rate, and thereafter at a rate per annum equal to the Base Rate.
(f) Modification and Extension. The issuance of any
supplement, modification, amendment, renewal, or extensions to any
Letter of Credit shall, for purposes hereof, be treated in all respects
the same as the issuance of a new Letter of Credit hereunder; provided
that the fees to be paid pursuant to Section 3.4(b)(i) shall only be
due if the expiration date of such Letter of Credit is extended.
31
(g) Applicability of ISP98 and UCP. Unless otherwise expressly
agreed by the Issuing Lender and the Borrowers when a Letter of Credit
is issued (including any such agreement applicable to an Existing
Letter of Credit), (i) the rules of the "International Standby
Practices 1998" published by the Institute of International Banking Law
& Practice (or such later version thereof as may be in effect at the
time of issuance) (the "ISP98") shall apply to each standby Letter of
Credit, and (ii) the rules of the Uniform Customs and Practice for
Documentary Credits, as most recently published by the International
Chamber of Commerce (the "ICC") at the time of issuance (including the
ICC decision published by the Commission on Banking Technique and
Practice on April 6, 1998 regarding the European single currency
(euro)) (the "UCP") shall apply to each commercial Letter of Credit.
(h) Responsibility of Issuing Lender. It is expressly
understood and agreed as between the Lenders that the obligations of
the Issuing Lender hereunder to the LOC Participants are only those
expressly set forth in this Credit Agreement and that the Issuing
Lender shall be entitled to assume that the conditions precedent set
forth in Section 5.2 have been satisfied unless it shall have acquired
actual knowledge that any such condition precedent has not been
satisfied; provided, however, that nothing set forth in this Section
2.2 shall be deemed to prejudice the right of any LOC Participant to
recover from the Issuing Lender any amounts made available by such LOC
Participant to the Issuing Lender pursuant to this Section 2.2 in the
event that it is determined by a court of competent jurisdiction that
the payment with respect to a Letter of Credit constituted gross
negligence or willful misconduct on the part of the Issuing Lender.
(i) Conflict with LOC Documents. In the event of any conflict
between this Credit Agreement and any LOC Document, this Credit
Agreement shall govern.
(j) Indemnification of Issuing Lender.
(i) In addition to its other obligations under this
Credit Agreement, the Credit Parties hereby agree to protect,
indemnify, pay and save harmless the Issuing Lender from and
against any and all claims, demands, liabilities, damages,
losses, costs, charges and expenses (including reasonable
attorneys' fees) that the Issuing Lender may incur or be
subject to as a consequence, direct or indirect, of (A) the
issuance of any Letter of Credit or (B) the failure of the
Issuing Lender to honor a drawing under a Letter of Credit as
a result of any act or omission, whether rightful or wrongful,
of any present or future de jure or de facto Governmental
Authority (all such acts or omissions, herein called
"Government Acts").
32
(ii) As between the Credit Parties and the Issuing
Lender, the Credit Parties shall assume all risks of the acts,
omissions or misuse of any Letter of Credit by the beneficiary
thereof. The Issuing Lender shall not be responsible for: (A)
the form, validity, sufficiency, accuracy, genuineness or
legal effect of any document submitted by any Credit Party in
connection with the application for and issuance of any Letter
of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or
forged; (B) the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign
any Letter of Credit or the rights or benefits thereunder or
proceeds thereof, in whole or in part, that may prove to be
invalid or ineffective for any reason; (C) failure of the
beneficiary of a Letter of Credit to comply fully with
conditions required in order to draw upon a Letter of Credit;
(D) errors, omissions, interruptions or delays in transmission
or delivery of any messages, by mail, cable, telegraph, telex
or otherwise, whether or not they be in cipher; (E) errors in
interpretation of technical terms; (F) any loss or delay in
the transmission or otherwise of any document required to be
delivered to the Issuing Lender in order to make a drawing
under a Letter of Credit or of the proceeds thereof; and (G)
any consequences arising from causes beyond the control of the
Issuing Lender, including, without limitation, any Government
Acts. None of the above shall affect, impair, or prevent the
vesting of the Issuing Lender's rights or powers hereunder.
(iii) In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth,
any action taken or omitted by any Agent-Related Person, the
Issuing Lender or any of the correspondents, participants or
assignees of the Issuing Lender under or in connection with
any Letter of Credit or the related certificates, if taken or
omitted in good faith, shall not put the Issuing Lender under
any resulting liability to the Credit Parties. It is the
intention of the parties that this Credit Agreement shall be
construed and applied to protect and indemnify the Issuing
Lender against any and all risks involved in the issuance of
the Letters of Credit, all of which risks are hereby assumed
by the Credit Parties, including, without limitation, whether
rightful or wrongful, any present or future Government Acts.
The Issuing Lender shall not, in any way, be liable for any
failure by the Issuing Lender or anyone else to pay any
drawing under any Letter of Credit as a result of any
Government Acts or any other cause beyond the control of the
Issuing Lender.
(iv) Nothing in this subsection (j) is intended to
limit the reimbursement obligation of the Credit Parties
contained in this Section 2.2. The obligations of the Credit
Parties under this subsection (j) shall survive the
termination of this Credit Agreement. No act or omission of
any current or prior beneficiary of a Letter of Credit shall
in any way affect or impair the rights of the Issuing Lender
to enforce any right, power or benefit under this Credit
Agreement.
33
(v) Notwithstanding anything to the contrary
contained in this subsection (j), the Credit Parties shall
have no obligation to indemnify the Issuing Lender in respect
of any liability incurred by the Issuing Lender arising solely
out of the gross negligence or willful misconduct of the
Issuing Lender. Nothing in this Credit Agreement shall relieve
the Issuing Lender of any liability to the Credit Parties in
respect of any action taken by the Issuing Lender which action
constitutes gross negligence or willful misconduct of the
Issuing Lender or a violation of the ISP98, the UCP or Uniform
Commercial Code (as applicable).
(k) The Issuing Lender shall be under no obligation to issue
any Letter of Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin
or restrain the Issuing Lender from issuing such Letter of
Credit, or any Requirement of Law applicable to the Issuing
Lender or any request or directive (whether or not having the
force of law) from any Governmental Authority with
jurisdiction over the Issuing Lender shall prohibit, or
request that the Issuing Lender refrain from, the issuance of
letters of credit generally or such Letter of Credit in
particular or shall impose upon the Issuing Lender with
respect to such Letter of Credit any restriction, reserve or
capital requirement (for which the Issuing Lender is not
otherwise compensated hereunder) not in effect on the Closing
Date, or shall impose upon the Issuing Lender any
unreimbursable loss, cost or expense which was not applicable
on the Closing Date and which the Issuing Lender in good ▇▇▇▇▇
▇▇▇▇▇ material to it; or
(ii) the issuance of such Letter of Credit would
violate one or more policies of the Issuing Lender.
2.3 Joint and Several Liability of the Borrowers.
(a) Each of the Borrowers is accepting joint and several
liability hereunder in consideration of the financial accommodation to
be provided by the Lenders under this Credit Agreement, for the mutual
benefit, directly and indirectly, of each of the Borrowers and in
consideration of the undertakings of each of the Borrowers to accept
joint and several liability for the obligations of each of them.
(b) Each of the Borrowers jointly and severally hereby
irrevocably and unconditionally accepts, not merely as a surety but
also as a co-debtor, joint and several liability with the other
Borrower with respect to the payment and performance of all of the
Obligations arising under this Credit Agreement and the other Credit
Documents, it being the intention of the parties hereto that all the
Obligations shall be the joint and several obligations of each of the
Borrowers without preferences or distinction among them.
34
(c) If and to the extent that either of the Borrowers shall
fail to make any payment with respect to any of the Obligations as and
when due or to perform any of the Obligations in accordance with the
terms thereof, then in each such event, the other Borrower will make
such payment with respect to, or perform, such Obligation.
(d) The obligations of each Borrower under the provisions of
this Section 2.3 constitute full recourse obligations of such Borrower,
enforceable against it to the full extent of its properties and assets.
(e) Except as otherwise expressly provided herein, to the
extent permitted by law, each Borrower hereby waives notice of
acceptance of its joint and several liability, notice of occurrence of
any Default or Event of Default (except to the extent notice is
expressly required to be given pursuant to the terms of this Credit
Agreement), or of any demand for any payment under this Credit
Agreement, notice of any action at any time taken or omitted by the
Administrative Agent or the Lenders under or in respect of any of the
obligations hereunder, any requirement of diligence and, generally, all
demands, notices and other formalities of every kind in connection with
this Credit Agreement. Each Borrower hereby assents to, and waives
notice of, any extension or postponement of the time for the payment of
any of the Obligations, the acceptance of any partial payment thereon,
any waiver, consent or other action or acquiescence by the
Administrative Agent or the Lenders at any time or times in respect of
any default by either Borrower in the performance or satisfaction of
any term, covenant, condition or provision of this Credit Agreement,
any and all other indulgences whatsoever by the Administrative Agent or
the Lenders in respect of any of the obligations hereunder, and the
taking, addition, substitution or release, in whole or in part, at any
time or times, of any security for any of such obligations or the
addition, substitution or release, in whole or in part, of either
Borrower. Without limiting the generality of the foregoing, each
Borrower assents to any other action or delay in acting or any failure
to act on the part of the Administrative Agent or the Lenders,
including, without limitation, any failure strictly or diligently to
assert any right or to pursue any remedy or to comply fully with
applicable laws or regulations thereunder which might, but for the
provisions of this Section 2.3, afford grounds for terminating,
discharging or relieving such Borrower, in whole or in part, from any
of its obligations under this Section 2.3, it being the intention of
each Borrower that, so long as any of the Obligations hereunder remain
unsatisfied, the obligations of such Borrower under this Section 2.3
shall not be discharged except by performance and then only to the
extent of such performance. The obligations of each Borrower under this
Section 2.3 shall not be diminished or rendered unenforceable by any
winding up, reorganization, arrangement, liquidation, reconstruction or
similar proceeding with respect to either Borrower or a Lender. The
joint and several liability of the Borrowers hereunder shall continue
in full force and effect notwithstanding any absorption, merger,
amalgamation or any other change whatsoever in the name, membership,
constitution or place of formation of either Borrower or any of the
Lenders.
(f) The provisions of this Section 2.3 are made for the
benefit of the Lenders and their successors and assigns, and may be
enforced by them from time to time against either of the Borrowers as
often as occasion therefor may arise and without requirement on the
part of the Lenders first to marshal any of its claims or to exercise
any of its rights against the other Borrower or to exhaust any remedies
available to it against the other Borrower or to resort to any other
source or means of obtaining payment of any of the Obligations
hereunder or to elect any other remedy. The provisions of this Section
2.3 shall remain in effect until all the Obligations shall have been
paid in full or otherwise fully satisfied. If at any time, any payment,
or any part thereof, made in respect of any of the Obligations is
rescinded or must otherwise be restored or returned by the Lenders upon
the insolvency, bankruptcy or reorganization of either of the
Borrowers, or otherwise, the provisions of this Section 2.3 will
forthwith be reinstated and in effect as though such payment had not
been made.
(g) Notwithstanding any provision to the contrary contained
herein or in any of the other Credit Documents, to the extent the
obligations of either Borrower shall be adjudicated to be invalid or
unenforceable for any reason (including, without limitation, because of
any applicable state or federal law relating to fraudulent conveyances
or transfers) then the obligations of such Borrower hereunder shall be
limited to the maximum amount that is permissible under applicable law
(whether federal or state and including, without limitation, the
Bankruptcy Code).
35
2.4 Appointment of BOP.
BRT hereby appoints BOP to act as its agent for all purposes under this
Credit Agreement (including, without limitation, with respect to all matters
related to the borrowing and repayment of Loans) and agrees that (i) BOP may
execute such documents on behalf of BRT as BOP deems appropriate in its sole
discretion and BRT shall be obligated by all of the terms of any such document
executed on its behalf, (ii) any notice or communication delivered by the
Administrative Agent or the Lender to BOP shall be deemed delivered to BRT and
(iii) the Administrative Agent or the Lenders may accept, and be permitted to
rely on, any document, instrument or agreement executed by BOP on behalf of BRT.
2.5 Non-Recourse.
Notwithstanding anything herein to the contrary, no recourse shall be
had against Brandywine Realty Services Partnership or any past, present or
future shareholder, officer, director or trustee of BRT for any obligation of
the Credit Parties under the Credit Documents, or for any claim based thereon or
otherwise in respect thereof; provided, however, that this Section 2.5 shall not
restrict or limit any claim against any such Person arising out of or occurring
with respect to fraud or any intentional misrepresentation or any act or
omission that is willful or wanton or constitutes gross negligence or willful
misconduct.
SECTION 3
GENERAL PROVISIONS APPLICABLE TO LOANS AND LETTERS OF CREDIT
3.1 Interest.
(a) Interest Rate. All Base Rate Loans shall accrue interest
at the Adjusted Base Rate. All Eurodollar Loans shall accrue interest
at the Adjusted Eurodollar Rate.
(b) Default Rate of Interest. Upon the occurrence, and during
the continuance, of an Event of Default, the principal of and, to the
extent permitted by law, interest on the Loans and any other amounts
owing hereunder or under the other Credit Documents (including without
limitation fees and expenses) shall bear interest, payable on demand,
at a per annum rate equal to four percent (4%) plus the rate which
would otherwise be applicable (or if no rate is applicable, then the
rate for Base Rate Loans plus four percent (4%) per annum); provided
that unless the Loans have been accelerated, interest, including the
default rate of interest, shall only be due and payable on the Interest
Payment Dates.
36
(c) Interest Payments. Interest on Loans shall be due and
payable in arrears on each Interest Payment Date. If an Interest
Payment Date falls on a date which is not a Business Day, such Interest
Payment Date shall be deemed to be the succeeding Business Day, except
that in the case of Eurodollar Loans where the succeeding Business Day
falls in the succeeding calendar month, such Interest Payment Date
shall be the preceding Business Day.
3.2 Place and Manner of Payments.
All payments of principal, interest, fees, expenses and other amounts
to be made by a Borrower under this Credit Agreement shall be made by such
Borrower unconditionally and without deduction for any counterclaim, defense,
recoupment or setoff and received not later than 2:00 p.m. on the date when due,
in Dollars and in immediately available funds, to the Administrative Agent at
its offices in Charlotte, North Carolina or to the Issuing Lender at its
applicable address. Payments received after such time shall be deemed to have
been received on the next Business Day. The Borrowers shall, at the time they
make any payment under this Credit Agreement, specify to the Administrative
Agent or Issuing Lender, as applicable, the Loans, Letters of Credit, fees or
other amounts payable by the Borrowers hereunder to which such payment is to be
applied (and in the event that they fail to specify, or if such application
would be inconsistent with the terms hereof, the Administrative Agent shall,
subject to Section 3.7, distribute such payment to the Lenders in such manner as
the Administrative Agent may deem appropriate). The Administrative Agent will
distribute any such payment to the Lenders on the day received if such payment
is received prior to 2:00 p.m.; otherwise the Administrative Agent will
distribute such payment to the Lenders on the next succeeding Business Day.
Whenever any payment hereunder shall be stated to be due on a day which is not a
Business Day, the due date thereof shall be extended to the next succeeding
Business Day (subject to accrual of interest and fees for the period of such
extension), except that in the case of Eurodollar Loans, if the extension would
cause the payment to be made in the next following calendar month, then such
payment shall instead be made on the next preceding Business Day.
3.3 Prepayments.
(a) Voluntary Prepayments. The Borrowers shall have the right
to prepay Loans in whole or in part from time to time without premium
or penalty; provided, however, that (i) Eurodollar Loans may only be
prepaid on three Business Days' prior written notice to the
Administrative Agent and any prepayment of Eurodollar Loans will be
subject to Section 3.14 and (ii) each such partial prepayment of Loans
shall be in the minimum principal amount of $1,000,000 and integral
multiples of $100,000 in excess thereof.
37
(b) Mandatory Prepayments. If at any time (other than if
consented to in writing by the Lenders) the aggregate amount of
Revolving Loans outstanding plus LOC Obligations outstanding exceeds
the Revolving Committed Amount, the Borrowers shall promptly forward to
the Administrative Agent an amount such that the amount of Revolving
Loans outstanding plus LOC Obligations outstanding does not exceed the
Revolving Committed Amount (to be applied as set forth in Section
3.3(c)).
(c) Application of Prepayments. All amounts paid pursuant to
Section 3.3(a) shall be applied as directed by the Borrowers. All
amounts paid pursuant to Section 3.3(a) the application of which has
not been directed by the Borrowers and all amounts required to be paid
pursuant to Section 3.3(b) shall be applied first to Base Rate Loans
and then to Eurodollar Loans in direct order of Interest Period
maturities. All prepayments hereunder shall be subject to Section 3.14;
provided that prepayments required to be made pursuant to Section
3.3(b) that repay a Eurodollar Loan within 30 days of the last day of
its Interest Period shall not be subject to Section 3.14.
3.4 Fees.
(a) Unused and Facility Fees. In consideration of the
Revolving Committed Amount being made available by the Lenders
hereunder, the Borrowers agree to pay to the Administrative Agent, for
the pro rata benefit of each Lender (based on each Lender's Commitment
and the number of days that such Lender was a Lender during the prior
fiscal quarter), a fee equal to:
(i) for each day that BRT does not have at least two
Investment Grade Ratings in effect, (A) if the average Unused
Commitment on such day is less than 50% of the Revolving
Committed Amount, .15% per annum on the Unused Commitment on
such day and (B) if the average Unused Commitment on such day
is greater than or equal to 50% of the Revolving Committed
Amount, .20% per annum on the Unused Commitment on such day
(collectively, the "Unused Fees"); and
(ii) for each day that BRT has at least two
Investment Grade Ratings in effect, .20% per annum on the
entire Revolving Committed Amount (the "Facility Fees").
The accrued Unused Fees and Facility Fees shall commence to accrue on
the Effective Date and shall be due and payable in arrears on the first
day of each fiscal quarter of the Borrowers (as well as on the
Revolving Loan Maturity Date and on any date that the Revolving
Committed Amount is reduced) for the immediately preceding fiscal
quarter (or portion thereof), beginning with the first of such dates to
occur after the Effective Date.
38
(b) Letter of Credit Fees.
(i) Letter of Credit Fees. In consideration of the
issuance of Letters of Credit hereunder, the Borrowers agree
to pay to the Issuing Lender, for the pro rata benefit of the
applicable Lenders (based on each Lender's Commitment), a per
annum fee (the "Letter of Credit Fees") equal to 1.125% on the
average daily maximum amount available to be drawn under each
such Letter of Credit from the date of issuance to the date of
expiration. The Letter of Credit Fees will be payable in full
on the date of issuance of the Letter of Credit.
(ii) Issuing Lender Fees. In addition to the Letter
of Credit Fees payable pursuant to subsection (i) above, the
Borrowers shall pay to the Issuing Lender for its own account,
without sharing by the other Lenders, (A) a fee equal to .125%
per annum on the total sum of the undrawn amounts of all
Letters of Credit issued by the Issuing Lender, such fee to be
paid in full on the date of issuance of the Letter of Credit
and (B) the customary charges from time to time of the Issuing
Lender for its services in connection with the issuance,
amendment, payment, transfer, administration, cancellation and
conversion of, and drawings under, Letters of Credit
(collectively, the "Issuing Lender Fees").
(c) Administrative Fees. The Borrowers agree to pay to the
Administrative Agent, for its own account, an annual fee as agreed to
between the Borrowers and the Administrative Agent in the Fee Letter.
3.5 Payment in full at Maturity; Extension of Maturity.
(a) On the Revolving Loan Maturity Date, the entire
outstanding principal balance of all Revolving Loans and all LOC
Obligations, together with accrued but unpaid interest and all other
sums owing with respect thereto, shall be due and payable in full,
unless accelerated sooner pursuant to Section 9.2.
(b) If on the Initial Revolving Loan Maturity Date (i) no
Default or Event of Default exists and is continuing and (ii) the
Borrowers pay to the Administrative Agent, for the pro rata benefit of
the Lenders, an extension fee equal to .25% of the then Revolving
Committed Amount, the Borrowers may elect to extend the Revolving Loan
Maturity Date to June 29, 2005. The Borrowers shall give written notice
to the Administrative Agent (which shall promptly notify each of the
Lenders) of their desire to effect such election at least 30 days, but
no more than 90 days, prior to the Initial Revolving Loan Maturity
Date.
3.6 Computations of Interest and Fees.
(a) Except for Base Rate Loans bearing interest based on the
Prime Rate, which shall be calculated on the basis of a 365 or 366 day
year as the case may be, all computations of interest and fees
hereunder shall be made on the basis of the actual number of days
elapsed over a year of 360 days. Interest shall accrue from and include
the date of borrowing (or continuation or conversion) but exclude the
date of payment.
39
(b) It is the intent of the Lenders and the Credit Parties to
conform to and contract in strict compliance with applicable usury law
from time to time in effect. All agreements between the Lenders and the
Credit Parties are hereby limited by the provisions of this paragraph
which shall override and control all such agreements, whether now
existing or hereafter arising and whether written or oral. In no way,
nor in any event or contingency (including but not limited to
prepayment or acceleration of the maturity of any obligation), shall
the interest taken, reserved, contracted for, charged, or received
under this Credit Agreement, under the Notes or otherwise, exceed the
maximum nonusurious amount permissible under applicable law. If, from
any possible construction of any of the Credit Documents or any other
document, interest would otherwise be payable in excess of the maximum
nonusurious amount, any such construction shall be subject to the
provisions of this paragraph and such interest shall be automatically
reduced to the maximum nonusurious amount permitted under applicable
law, without the necessity of execution of any amendment or new
document. If any Lender shall ever receive anything of value which is
characterized as interest on the Loans under applicable law and which
would, apart from this provision, be in excess of the maximum lawful
amount, an amount equal to the amount which would have been excessive
interest shall, without penalty, be applied to the reduction of the
principal amount owing on the Loans and not to the payment of interest,
or refunded to the Credit Parties or the other payor thereof if and to
the extent such amount which would have been excessive exceeds such
unpaid principal amount of the Loans. The right to demand payment of
the Loans or any other indebtedness evidenced by any of the Credit
Documents does not include the right to receive any interest which has
not otherwise accrued on the date of such demand, and the Lenders do
not intend to charge or receive any unearned interest in the event of
such demand. All interest paid or agreed to be paid to the Lenders with
respect to the Loans shall, to the extent permitted by applicable law,
be amortized, prorated, allocated, and spread throughout the full
stated term (including any renewal or extension) of the Loans so that
the amount of interest on account of such indebtedness does not exceed
the maximum nonusurious amount permitted by applicable law.
3.7 Pro Rata Treatment.
Except to the extent otherwise provided herein:
(a) Loans. Each Revolving Loan borrowing, each payment or
prepayment of principal of any Loan, each payment of fees (other than
administrative fees payable pursuant to Section 3.4(c), the Issuing
Lender Fees and, as set forth in Section 3.4(a), the Unused Fees and
Facility Fees), each reduction of the Revolving Committed Amount, and
each conversion or continuation of any Loan, shall (except as otherwise
provided in Section 3.11) be allocated pro rata among the Lenders in
accordance with the respective Revolving Loan Commitment Percentages of
the Lenders (or, if the Commitments of the Lenders have expired or been
terminated, in accordance with the respective principal amounts of the
outstanding Loans and Participation Interests of the Lenders); provided
that, if any Lender shall have failed to pay its applicable pro rata
share of any Revolving Loan, then any amount to which such Lender would
otherwise be entitled pursuant to this Section 3.7 shall instead be
payable to the Administrative Agent until the share of such Loan not
funded by such Lender has been repaid; provided further, that in the
event any amount paid to any Lender pursuant to this Section 3.7 is
rescinded or must otherwise be returned by the Administrative Agent,
each Lender shall, upon the request of the Administrative Agent, repay
to the Administrative Agent the amount so paid to such Lender, with
interest for the period commencing on the date such payment is returned
by the Administrative Agent until the date the Administrative Agent
receives such repayment at a rate per annum equal to, during the period
to but excluding the date two Business Days after such request, the
Federal Funds Rate, and thereafter, at the Base Rate plus two percent
(2%) per annum.
40
(b) Letters of Credit. Each payment of unreimbursed drawings
in respect of LOC Obligations shall be allocated to each LOC
Participant pro rata in accordance with its Revolving Loan Commitment
Percentage; provided that, if any LOC Participant shall have failed to
pay its applicable pro rata share of any drawing under any Letter of
Credit, then any amount to which such LOC Participant would otherwise
be entitled pursuant to this subsection (b) shall instead be payable to
the Issuing Lender until the share of such unreimbursed drawing not
funded by such Lender has been repaid; provided further, that in the
event any amount paid to any LOC Participant pursuant to this
subsection (b) is rescinded or must otherwise be returned by the
Issuing Lender, each LOC Participant shall, upon the request of the
Issuing Lender, repay to the Administrative Agent for the account of
the Issuing Lender the amount so paid to such LOC Participant, with
interest for the period commencing on the date such payment is returned
by the Issuing Lender until the date the Issuing Lender receives such
repayment at a rate per annum equal to, during the period to but
excluding the date two Business Days after such request, the Federal
Funds Rate, and thereafter, the Base Rate plus two percent (2%) per
annum.
3.8 Sharing of Payments.
The Lenders agree among themselves that, except to the extent otherwise
provided herein, in the event that any Lender shall obtain payment in respect of
any Loan or any other obligation owing to such Lender under this Credit
Agreement through the exercise of a right of setoff, banker's lien or
counterclaim, or pursuant to a secured claim under Section 506 of the Bankruptcy
Code or other security or interest arising from, or in lieu of, such secured
claim, received by such Lender under any applicable bankruptcy, insolvency or
other similar law or otherwise, or by any other means (other than in connection
with an assignment pursuant to Section 3.15 or Section 11.3), in excess of its
pro rata share of such payment as provided for in this Credit Agreement, such
Lender shall promptly pay in cash or purchase from the other Lenders a
participation in such Loans and other obligations in such amounts, and make such
other adjustments from time to time, as shall be equitable to the end that all
Lenders share such payment in accordance with their respective ratable shares as
provided for in this Credit Agreement. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender through the
exercise of a right of setoff, banker's lien, counterclaim or other event as
aforesaid shall be rescinded or must otherwise be restored, each Lender which
shall have shared the benefit of such payment shall, by payment in cash or a
repurchase of a participation theretofore sold, return its share of that benefit
(together with its share of any accrued interest payable with respect thereto)
to each Lender whose payment shall have been rescinded or otherwise restored.
The Credit Parties agree that any Lender so purchasing such a participation may,
to the fullest extent permitted by law, exercise all rights of payment,
including setoff, banker's lien or counterclaim, with respect to such
participation as fully as if such Lender were a holder of such Loan or other
obligation in the amount of such participation. Except as otherwise expressly
provided in this Credit Agreement, if any Lender shall fail to remit to the
Administrative Agent or any other Lender an amount payable by such Lender to the
Administrative Agent or such other Lender pursuant to this Credit Agreement on
the date when such amount is due, such payments shall be made together with
interest thereon for each date from the date such amount is due until the date
such amount is paid to the Administrative Agent or such other Lender at a rate
per annum equal to the Federal Funds Rate. If under any applicable bankruptcy,
insolvency or other similar law, any Lender receives a secured claim in lieu of
a setoff to which this Section 3.8 applies, such Lender shall, to the extent
practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders under this Section 3.8 to share in the
benefits of any recovery on such secured claim.
41
3.9 Capital Adequacy.
If, after the date hereof, any Lender has determined that the adoption
or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or administration
of, any applicable law, rule or regulation regarding capital adequacy, or
compliance by such Lender, or its parent corporation, with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such Lender's (or parent corporation's)
capital or assets as a consequence of its commitments or obligations hereunder
to a level below that which such Lender, or its parent corporation, could have
achieved but for such adoption, effectiveness, change or compliance (taking into
consideration such Lender's (or parent corporation's) policies with respect to
capital adequacy), then, upon notice from such Lender to the Borrowers and the
Administrative Agent, the Borrowers shall be obligated to pay to such Lender
such additional amount or amounts as will compensate such Lender (or parent
corporation) on an after-tax basis (after taking into account applicable
deductions and credits in respect of the amount indemnified) for such reduction.
Each determination by any such Lender of amounts owing under this Section shall,
absent manifest error, be conclusive and binding on the parties hereto. This
covenant shall survive the termination of this Credit Agreement and the payment
of the Loans and all other amounts payable hereunder.
3.10 Inability To Determine Interest Rate.
If prior to the first day of any Interest Period, the Administrative
Agent shall have determined in good faith (which determination shall be
conclusive and binding upon the Borrowers) that, by reason of circumstances
affecting the relevant market, adequate and reasonable means do not exist for
ascertaining the Adjusted Eurodollar Rate for such Interest Period, the
Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrowers and the Lenders as soon as practicable thereafter, and will also give
prompt written notice to the Borrowers when such conditions no longer exist. If
such notice is given (a) any Eurodollar Loans requested to be made on the first
day of such Interest Period shall be made as Base Rate Loans and (b) any Loans
that were to have been converted on the first day of such Interest Period to or
continued as Eurodollar Loans shall be converted to or continued as Base Rate
Loans. Until such notice has been withdrawn by the Administrative Agent, no
further Eurodollar Loans shall be made or continued as such, nor shall the
Borrowers have the right to convert Base Rate Loans to Eurodollar Loans.
42
3.11 Illegality.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurodollar Loans as contemplated by this Credit Agreement, (a) such
Lender shall promptly give written notice of such circumstances to the Borrowers
and the Administrative Agent (which notice shall be promptly withdrawn whenever
such circumstances no longer exist), (b) the commitment of such Lender hereunder
to make Eurodollar Loans, continue Eurodollar Loans as such and convert a Base
Rate Loan to Eurodollar Loans shall forthwith be cancelled and, until such time
as it shall no longer be unlawful for such Lender to make or maintain Eurodollar
Loans, such Lender shall then have a commitment only to make a Base Rate Loan
when a Eurodollar Loan is requested and (c) such Lender's Loans then outstanding
as Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans
on the respective last days of the then current Interest Periods with respect to
such Loans or within such earlier period as required by law. If any such
conversion of a Eurodollar Loan occurs on a day which is not the last day of the
then current Interest Period with respect thereto, the Borrowers shall pay to
such Lender such amounts, if any, as may be required pursuant to Section 3.14;
provided that no such payments shall be required if the conversion of a
Eurodollar Loan occurs within 30 days of the last day of the Interest Period of
such Eurodollar Loan.
3.12 Requirements of Law.
If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof applicable to any Lender, or compliance by
any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority, in each case made
subsequent to the Closing Date (or, if later, the date on which such Lender
becomes a Lender):
(a) shall subject such Lender to any tax of any kind
whatsoever with respect to any Letter of Credit, any Eurodollar Loans
made by it or its obligation to make Eurodollar Loans, or change the
basis of taxation of payments to such Lender in respect thereof (except
for Non-Excluded Taxes covered by Section 3.13 (including Non-Excluded
Taxes imposed solely by reason of any failure of such Lender to comply
with its obligations (if any) under Section 3.13(b)) and changes in
taxes measured by or imposed upon the overall net income, or franchise
tax (imposed in lieu of such net income tax), of such Lender or its
applicable lending office, branch, or any Affiliate thereof);
(b) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against assets
held by, deposits or other liabilities in or for the account of,
advances, loans or other extensions of credit by, or any other
acquisition of funds by, any office of such Lender which is not
otherwise included in the determination of the Adjusted Eurodollar Rate
hereunder; or
43
(c) shall impose on such Lender any other condition (excluding
any tax of any kind whatsoever);
and the result of any of the foregoing is to increase the cost to such Lender,
by an amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or issuing or participating in
Letters of Credit or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, upon notice to the Borrowers from such Lender,
through the Administrative Agent, in accordance herewith, the Borrowers shall be
obligated to promptly pay such Lender, upon its demand, any additional amounts
necessary to compensate such Lender on an after-tax basis (after taking into
account applicable deductions and credits in respect of the amount indemnified)
for such increased cost or reduced amount receivable, provided that, in any such
case, the Borrowers may elect to convert the Eurodollar Loans made by such
Lender hereunder to Base Rate Loans by giving the Administrative Agent at least
one Business Day's notice of such election, in which case the Borrowers shall
promptly pay to such Lender, upon demand, without duplication, such amounts, if
any, as may be required pursuant to Section 3.14. If any Lender becomes entitled
to claim any additional amounts pursuant to this Section 3.12, it shall provide
prompt notice thereof to the Borrowers, through the Administrative Agent,
certifying (x) that one of the events described in this Section 3.12 has
occurred and describing in reasonable detail the nature of such event, (y) as to
the increased cost or reduced amount resulting from such event and (z) as to the
additional amount demanded by such Lender and a reasonably detailed explanation
of the calculation thereof. Such a certificate as to any additional amounts
payable pursuant to this Section 3.12 submitted by such Lender, through the
Administrative Agent, to the Borrowers shall be conclusive and binding on the
parties hereto in the absence of manifest error. This covenant shall survive the
termination of this Credit Agreement and the payment of the Loans and all other
amounts payable hereunder.
44
3.13 Taxes.
(a) Except as provided below in this Section 3.13, all
payments made by the Borrowers under this Credit Agreement and any
Notes shall be made free and clear of, and without deduction or
withholding for or on account of, any present or future income, stamp
or other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any court, or governmental body, agency or other official,
excluding taxes measured by or imposed upon the overall net income of
any Lender or its applicable lending office, or any branch or Affiliate
thereof, and all franchise taxes, branch taxes, taxes on doing business
or taxes on the overall capital or net worth of any Lender or its
applicable lending office, or any branch or Affiliate thereof, in each
case imposed in lieu of net income taxes: (i) by the jurisdiction under
the laws of which such Lender, applicable lending office, branch or
Affiliate is organized or is located, or in which its principal
executive office is located, or any nation within which such
jurisdiction is located or any political subdivision thereof; or (ii)
by reason of any connection between the jurisdiction imposing such tax
and such Lender, applicable lending office, branch or Affiliate other
than a connection arising solely from such Lender having executed,
delivered or performed its obligations, or received payment under or
enforced, this Credit Agreement or any Notes. If any such non-excluded
taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("Non-Excluded Taxes") are required to be withheld from
any amounts payable to the Administrative Agent or any Lender hereunder
or under any Notes, (A) the amounts so payable to the Administrative
Agent or such Lender shall be increased to the extent necessary to
yield to the Administrative Agent or such Lender (after payment of all
Non-Excluded Taxes) interest on any such other amounts payable
hereunder at the rates or in the amounts specified in this Credit
Agreement and any Notes, provided, however, that the Borrowers shall be
entitled to deduct and withhold any Non-Excluded Taxes and shall not be
required to increase any such amounts payable to any Lender that is not
organized under the laws of the United States of America or a state
thereof if such Lender fails to comply with the requirements of
paragraph (b) of this Section 3.13 whenever any Non-Excluded Taxes are
payable by the Borrowers, and (B) as promptly as possible after request
therefor the Borrowers shall send to the Administrative Agent for its
own account or for the account of such Lender, as the case may be, a
certified copy of an original official receipt received by the
Borrowers showing payment thereof. If the Borrowers fail to pay any
Non-Excluded Taxes when due to the appropriate taxing authority or fail
to remit to the Administrative Agent the required receipts or other
required documentary evidence, the Borrowers shall indemnify the
Administrative Agent and any Lender for any incremental taxes, interest
or penalties that may become payable by the Administrative Agent or any
Lender as a result of any such failure. The agreements in this
subsection shall survive the termination of this Credit Agreement and
the payment of the Loans and all other amounts payable hereunder.
45
(b) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof shall:
(i) (A) on or before the date of any payment by the
Borrowers under this Credit Agreement or Notes to such Lender,
deliver to the Borrowers and the Administrative Agent (x) two
duly completed copies of United States Internal Revenue
Service Form W8-BEN or W8-ECI, or successor applicable form,
as the case may be, certifying that it is entitled to receive
payments under this Credit Agreement and any Notes without
deduction or withholding of any United States federal income
taxes and (y) an Internal Revenue Service Form W-8 or W-9, or
successor applicable form, as the case may be, certifying that
it is entitled to an exemption from United States backup
withholding tax;
(B) deliver to the Borrowers and the
Administrative Agent two further copies of any such form or
certification on or before the date that any such form or
certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent
form previously delivered by it to the Borrowers; and
(C) obtain such extensions of time for
filing and complete such forms or certifications as may
reasonably be requested by the Borrowers or the Administrative
Agent; or
(ii) in the case of any such Lender that is not
a "bank" within the meaning of Section 881(c)(3)(A) of the
Internal Revenue Code, such Lender shall (A) represent to the
Borrowers (for the benefit of the Borrowers and the
Administrative Agent) that it is not a bank within the meaning
of Section 881(c)(3)(A) of the Internal Revenue Code, (B)
furnish to the Borrowers, on or before the date of any payment
by the Borrowers, with a copy to the Administrative Agent, two
accurate and complete original signed copies of Internal
Revenue Service Form W-8, or successor applicable form
certifying to such Lender's legal entitlement at the date of
such certificate to an exemption from U.S. withholding tax
under the provisions of Section 881(c) of the Internal Revenue
Code with respect to payments to be made under this Credit
Agreement and any Notes (and to deliver to the Borrowers and
the Administrative Agent two further copies of such form on or
before the date it expires or becomes obsolete and after the
occurrence of any event requiring a change in the most
recently provided form and, if necessary, obtain any
extensions of time reasonably requested by the Borrowers or
the Administrative Agent for filing and completing such
forms), and (C) agree, to the extent legally entitled to do
so, upon reasonable request by the Borrowers, to provide to
the Borrowers (for the benefit of the Borrowers and the
Administrative Agent) such other forms as may be reasonably
required in order to establish the legal entitlement of such
Lender to an exemption from withholding with respect to
payments under this Credit Agreement and any Notes.
46
Notwithstanding the above, if any change in treaty, law or regulation
has occurred after the date such Person becomes a Lender hereunder
which renders all such forms inapplicable or which would prevent such
Lender from duly completing and delivering any such form with respect
to it and such Lender so advises the Borrowers and the Administrative
Agent then such Lender shall be exempt from such requirements. Each
Person that shall become a Lender or a participant of a Lender pursuant
to Section 11.3 shall, upon the effectiveness of the related transfer,
and if applicable, be required to provide all of the forms,
certifications and statements required pursuant to this subsection (b);
provided that in the case of a participant of a Lender, the obligations
of such participant of a Lender pursuant to this subsection (b) shall
be determined as if such participant of a Lender were a Lender except
that such participant of a Lender shall furnish all such required
forms, certifications and statements to the Lender from which the
related participation shall have been purchased.
3.14 Compensation.
Except as expressly set forth in Section 3.3(c), the Borrowers promise
to indemnify each Lender and to hold each Lender harmless from any loss or
expense which such Lender may sustain or incur as a consequence of (a) default
by the Borrowers in making a borrowing of, conversion into or continuation of
Eurodollar Loans after the Borrowers have given a notice requesting the same in
accordance with the provisions of this Credit Agreement, (b) default by the
Borrowers in making any prepayment of a Eurodollar Loan after the Borrowers have
given a notice thereof in accordance with the provisions of this Credit
Agreement and (c) any continuation, conversion, payment or prepayment of
Eurodollar Loans on a day which is not the last day of an Interest Period with
respect thereto. Such indemnification shall be calculated by the Administrative
Agent and shall include, without limitation, an amount equal to (i) the amount
of interest which would have accrued on the amount so prepaid, or not so
borrowed, converted or continued, for the period from the date of such
prepayment or of such failure to borrow, convert or continue to the last day of
the applicable Interest Period (or, in the case of a failure to borrow, convert
or continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Eurodollar
Loans provided for herein minus (ii) the amount of interest which would have
accrued to such Lender on such amount by placing such amount on deposit for a
comparable period with leading banks in the interbank Eurodollar market. The
agreements in this Section 3.14 shall survive the termination of this Credit
Agreement and the payment of the Loans and all other amounts payable hereunder.
Notwithstanding the foregoing, any prepayment of a Eurodollar Loan made
hereunder (as a result of a mandatory requirement of this Credit Agreement)
within thirty (30) days of the end of the Interest Period with respect to such
Eurodollar Loan, shall not be subject to this Section 3.14.
47
3.15 Mitigation; Mandatory Assignment.
Each Lender shall use reasonable efforts to avoid or mitigate any
increased cost or suspension of the availability of an interest rate under
Sections 3.9 through 3.14 inclusive to the greatest extent practicable
(including transferring the Loans to another lending office or one of its
Affiliates) unless, in the opinion of such Lender, such efforts would be likely
to have an adverse effect upon it. In the event a Lender makes a request to the
Borrowers for additional payments in accordance with Sections 3.9, 3.10, 3.11,
3.12, 3.13 or 3.14 or a Lender becomes a Defaulting Lender, then, provided that
no Default or Event of Default has occurred and is continuing at such time, the
Borrowers may, at their own expense (such expense to include any transfer fee
payable to the Administrative Agent under Section 11.3(b) and any expense
pursuant to Section 3.14), and in their sole discretion, require such Lender to
transfer and assign in whole (but not in part), without recourse (in accordance
with and subject to the terms and conditions of Section 11.3(b)), all of its
interests, rights and obligations under this Credit Agreement to an assignee
which shall assume such assigned obligations (which assignee may be another
Lender, if a Lender accepts such assignment); provided that (a) such assignment
shall not conflict with any law, rule or regulation or order of any court or
other governmental authority and (b) the Borrowers or such assignee shall have
paid to the assigning Lender in immediately available funds the principal of and
interest accrued to the date of such payment on the portion of the Loans
hereunder held by such assigning Lender and all other amounts owed to such
assigning Lender hereunder, including amounts owed pursuant to Sections 3.9
through 3.14. Notwithstanding such assignment, and without limiting any other
provision of this Credit Agreement, such assigning Lender shall continue to
benefit from the provisions of Sections 3.9, 3.12, 3.13 and 11.5 with respect to
the period before the effectiveness of such assignment.
SECTION 4
GUARANTY
4.1 Guaranty of Payment.
Subject to Section 4.7, each of the Guarantors hereby, jointly and
severally, absolutely, irrevocably and unconditionally guarantees to each Lender
the prompt payment of the Obligations in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise). This
Guaranty is a guaranty of payment and not of collection and is a continuing
guaranty and shall apply to all Obligations whenever arising.
48
4.2 Obligations Unconditional.
The obligations of the Guarantors hereunder are absolute, irrevocable
and unconditional, irrespective of the value, genuineness, validity, regularity
or enforceability of any of the Credit Documents or any other agreement or
instrument referred to therein, to the fullest extent permitted by applicable
law, irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor.
Each Guarantor agrees that this Guaranty may be enforced by the Lenders without
the necessity at any time of resorting to or exhausting any other security or
collateral and without the necessity at any time of having recourse to the Notes
or any other of the Credit Documents or any collateral, if any, hereafter
securing the Obligations or otherwise and each Guarantor hereby waives the right
to require the Lenders to proceed against the Borrowers or any other Person
(including a co-guarantor) or to require the Lenders to pursue any other remedy
or enforce any other right. Each Guarantor further agrees that it shall have no
right of subrogation, indemnity, reimbursement or contribution against the
Borrowers or any other Guarantor of the Obligations for amounts paid under this
Guaranty until such time as the Lenders have been paid in full, all Commitments
under this Credit Agreement have been terminated and no Person or Governmental
Authority shall have any right to request any return or reimbursement of funds
from the Lenders in connection with monies received under the Credit Documents.
Each Guarantor further agrees that nothing contained herein shall prevent the
Lenders from suing on the Notes or any of the other Credit Documents or
foreclosing any security interest in or Lien on any collateral, if any, securing
the Obligations or from exercising any other rights available to any of them
under this Credit Agreement, the Notes, any of the other Credit Documents, or
any other instrument of security, if any, and the exercise of any of the
aforesaid rights and the completion of any foreclosure proceedings shall not
constitute a discharge of any of any Guarantor's obligations hereunder; it being
the purpose and intent of each Guarantor that its obligations hereunder shall be
absolute, independent, irrevocable and unconditional under any and all
circumstances. Neither any Guarantor's obligations under this Guaranty nor any
remedy for the enforcement thereof shall be impaired, modified, changed or
released in any manner whatsoever by an impairment, modification, change,
release or limitation of the liability of the Borrowers or by reason of the
bankruptcy or insolvency of the Borrowers. Each Guarantor waives any and all
notice of the creation, renewal, extension or accrual of any of the Obligations
and notice of or proof of reliance of by the Administrative Agent or any Lender
upon this Guaranty or acceptance of this Guaranty. The Obligations, and any of
them, shall conclusively be deemed to have been created, contracted or incurred,
or renewed, extended, amended or waived, in reliance upon this Guaranty. All
dealings between the Borrowers and any of the Guarantors, on the one hand, and
the Administrative Agent and the Lenders, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon this
Guaranty. The Guarantors further agree to all rights of set-off as set forth in
Section 11.2.
49
4.3 Modifications.
Each Guarantor agrees that (a) all or any part of the security now or
hereafter held for the Obligations, if any, may be exchanged, compromised or
surrendered from time to time; (b) the Lenders shall not have any obligation to
protect, perfect, secure or insure any such security interests, liens or
encumbrances now or hereafter held, if any, for the Obligations or the
properties subject thereto; (c) the time or place of payment of the Obligations
may be changed or extended, in whole or in part, to a time certain or otherwise,
and may be renewed or accelerated, in whole or in part; (d) the Borrowers and
any other party liable for payment under the Credit Documents may be granted
indulgences generally; (e) any of the provisions of the Notes or any of the
other Credit Documents may be modified, amended or waived; (f) any party
(including any co-guarantor) liable for the payment thereof may be granted
indulgences or be released; and (g) any deposit balance for the credit of the
Borrowers or any other party liable for the payment of the Obligations or liable
upon any security therefor may be released, in whole or in part, at, before or
after the stated, extended or accelerated maturity of the Obligations, all
without notice to or further assent by such Guarantor, which shall remain bound
thereon, notwithstanding any such exchange, compromise, surrender, extension,
renewal, acceleration, modification, indulgence or release.
4.4 Waiver of Rights.
Each Guarantor expressly waives to the fullest extent permitted by
applicable law: (a) notice of acceptance of this Guaranty by the Lenders and of
all extensions of credit to the Borrowers by the Lenders; (b) presentment and
demand for payment or performance of any of the Obligations; (c) protest and
notice of dishonor or of default (except as specifically required in this Credit
Agreement) with respect to the Obligations or with respect to any security
therefor; (d) notice of the Lenders obtaining, amending, substituting for,
releasing, waiving or modifying any security interest, lien or encumbrance, if
any, hereafter securing the Obligations, or the Lenders' subordinating,
compromising, discharging or releasing such security interests, liens or
encumbrances, if any; and (e) all other notices to which such Guarantor might
otherwise be entitled.
4.5 Reinstatement.
The obligations of the Guarantors under this Guaranty shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Obligations is rescinded or must be
otherwise restored by any holder of any of the Obligations, whether as a result
of any proceedings in bankruptcy or reorganization or otherwise, and each
Guarantor agrees that it will indemnify the Administrative Agent and each Lender
on demand for all reasonable costs and expenses (including, without limitation,
reasonable fees of counsel) incurred by the Administrative Agent or such Lender
in connection with such rescission or restoration, including any such costs and
expenses incurred in defending against any claim alleging that such payment
constituted a preference, fraudulent transfer or similar payment under any
bankruptcy, insolvency or similar law.
50
4.6 Remedies.
The Guarantors agree that, as between the Guarantors, on the one hand,
and the Administrative Agent and the Lenders, on the other hand, the Obligations
may be declared to be forthwith due and payable as provided in Section 9 (and
shall be deemed to have become automatically due and payable in the
circumstances provided in Section 9) notwithstanding any stay, injunction or
other prohibition preventing such declaration (or preventing such Obligations
from becoming automatically due and payable) as against any other Person and
that, in the event of such declaration (or such Obligations being deemed to have
become automatically due and payable), such Obligations (whether or not due and
payable by any other Person) shall forthwith become due and payable by the
Guarantors.
4.7 Limitation of Guaranty.
Notwithstanding any provision to the contrary contained herein or in
any of the other Credit Documents, to the extent the obligations of any
Guarantor shall be adjudicated to be invalid or unenforceable for any reason
(including, without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations of such
Guarantor hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the Bankruptcy Code).
4.8 Rights of Contribution.
The Credit Parties agree among themselves that, in connection with
payments made hereunder, each Credit Party shall have contribution rights
against the other Credit Parties as permitted under applicable law. Such
contribution rights shall be subordinate and subject in right of payment to the
obligations of the Credit Parties under the Credit Documents and no Credit Party
shall exercise such rights of contribution until all the Obligations have been
paid in full and the Commitments terminated.
51
SECTION 5
CONDITIONS PRECEDENT
5.1 Closing Conditions.
The obligation of the Lenders to enter into this Credit Agreement and
make the initial Extensions of Credit is subject to satisfaction of the
following conditions:
(a) Executed Credit Documents. Receipt by the Administrative
Agent of duly executed copies of: (i) this Credit Agreement; (ii) the
Notes; and (iii) all other Credit Documents required to be delivered on
or before the Effective Date, each in form and substance reasonably
acceptable to the Administrative Agent in its sole discretion.
(b) Partnership Documents. With respect to each Credit Party
that is a partnership, receipt by the Administrative Agent of the
following:
(i) Partnership Agreements. Certified copies of the
partnership agreement of such Credit Party, together with all
amendments thereto.
(ii) Certificates of Good Standing or Existence. A
certificate of good standing or existence for such Credit
Party issued as of a recent date by its state of organization
and each other state where the failure to qualify or be in
good standing could have a Material Adverse Effect.
(c) Corporate Documents. With respect to each Credit Party
that is a corporation, receipt by the Administrative Agent of the
following:
(i) Charter Documents. Copies of the articles or
certificates of incorporation or other charter documents of
such Credit Party certified to be true and complete as of a
recent date by the appropriate Governmental Authority of the
state or other jurisdiction of its incorporation and certified
by a secretary or assistant secretary of such Credit Party to
be true and correct as of the Closing Date.
(ii) Bylaws. A copy of the bylaws of such Credit
Party certified by a secretary or assistant secretary of such
Credit Party to be true and correct as of the Closing Date.
(iii) Good Standing. Copies of certificates of good
standing, existence or their equivalent with respect to such
Credit Party certified as of a recent date by the appropriate
Governmental Authority of the state or other jurisdiction of
incorporation and each other jurisdiction in which the failure
to so qualify and be in good standing could have a Material
Adverse Effect.
52
(d) Limited Liability Company Documents. With respect to each
Credit Party that is a limited liability company, receipt by the
Administrative Agent of the following:
(i) Certificate of Formation. A copy of the
certificate of formation of such Credit Party certified to be
true and complete by the appropriate Governmental Authority of
the state or jurisdiction of its formation and certified by
the sole or managing member of such Credit Party to be true
and correct as of the Closing Date.
(ii) Operating Agreement. A copy of the Operating
Agreement of such Credit Party certified by the sole or
managing member of such Credit Party to be true and correct as
of the Closing Date.
(iii) Good Standing. Copies of certificates of good
standing, existence or their equivalent with respect to such
Credit Party certified as of a recent date by the appropriate
Governmental Authority of the state or other jurisdiction of
formation and each other jurisdiction in which the failure to
so qualify and be in good standing could have a Material
Adverse Effect.
(e) Trust Documents. With respect to BRT, receipt by the
Administrative Agent of the following:
(i) Declaration of Trust. A copy of the Declaration
of Trust of BRT certified to be true and complete by the
appropriate Governmental Authority of the state or
jurisdiction of its formation and certified by the trustee of
BRT to be true and correct as of the Closing Date.
(ii) Bylaws. A copy of the Bylaws of BRT certified by
the trustee of BRT to be true and complete as of the Closing
Date.
(iii) Resolutions. Copies of the resolutions of the
Board of Trustees of BRT approving and adopting the Credit
Documents to which it and each Credit Party is a party, the
transactions contemplated therein and authorizing execution
and delivery thereof by and on behalf of itself and each
Credit Party.
53
(iv) Good Standing. Copies of certificates of good
standing, existence or their equivalent with respect to BRT
certified as of a recent date by the appropriate Governmental
Authorities of the state or other jurisdiction of formation
and each other jurisdiction in which the failure to so qualify
and be in good standing could have a Material Adverse Effect.
(v) Incumbency. An incumbency certificate with
respect to each of the Credit Parties, certified by a
secretary or assistant secretary of BRT to be true and correct
as of the Closing Date.
(f) Financial Statements. Receipt and approval by the Lenders
of: (i) the consolidated financial statements of the Credit Parties and
their Subsidiaries for the fiscal year ended December 31, 2000,
including balance sheets and income and cash flow statements, audited
by nationally recognized independent public accountants and containing
an unqualified opinion of such firm that such statements present
fairly, in all material respects, the consolidated financial condition
and results of operations of such Person, and are prepared in
conformity with GAAP, and (ii) interim consolidated financial
statements of the Credit Parties and their Subsidiaries for the three
months ended March 31, 2001, including balance sheets and income and
cash flow statements, accompanied by a certificate of the chief
financial officer of BRT to the effect that such interim financial
statements fairly present in all material respects the financial
condition and results of operations of the Credit Parties and their
Subsidiaries and have been prepared in accordance with GAAP, subject to
changes resulting from audit and normal year-end audit adjustments.
(g) Financial Projections and Other Information. Receipt and
approval by the Lenders of (i) financial projections for the Combined
Parties and (ii) summary financial projections for each Property, for
the calendar year ending 2001, in a form acceptable to the Lenders, and
such other financial information as any of the Lenders may require.
(h) Opinion of Counsel. Receipt by the Administrative Agent of
opinions (which shall cover, among other things, authority, legality,
validity, binding effect and enforceability), satisfactory to the
Administrative Agent, addressed to the Administrative Agent and the
Lenders and dated as of the Effective Date, from legal counsel to the
Credit Parties.
(i) Material Adverse Effect. There shall not have occurred a
change since December 31, 2000 that has had or could reasonably be
expected to have a Material Adverse Effect.
54
(j) Litigation. There shall not exist any pending or
threatened action, suit, investigation or proceeding in any court or
before any arbitrator or Governmental Authority against a Credit Party
or any of its Subsidiaries that would have or would reasonably be
expected to have a Material Adverse Effect.
(k) Officer's Certificate. The Administrative Agent shall have
received a certificate of the Borrowers on behalf of the Credit Parties
as of the Closing Date stating that (i) the Credit Parties and each of
their Subsidiaries are in compliance with all existing material
financial obligations, (ii) no action, suit, investigation or
proceeding is pending or threatened in any court or before any
arbitrator or Governmental Authority that purports to affect a Credit
Party or any transaction contemplated by the Credit Documents, if such
action, suit, investigation or proceeding could have or could be
reasonably expected to have a Material Adverse Effect, (iii) the
financial statements and information delivered pursuant to Sections
5.1(f) and (g) were prepared in good faith and using reasonable
assumptions and (iv) immediately after giving effect to this Credit
Agreement, the other Credit Documents and all the transactions
contemplated herein and therein to occur on such date, (A) each of the
Credit Parties is Solvent, (B) no Default or Event of Default exists,
(C) all representations and warranties contained herein and in the
other Credit Documents are true and correct in all material respects,
and (D) the Credit Parties and their Subsidiaries are in compliance as
of March 31, 2001 with each of the financial covenants set forth in
Section 7.2.
(l) Fees and Expenses. Payment by the Borrowers of all fees
and expenses owed by them to the Lenders and the Administrative Agent,
including, without limitation, payment to the Administrative Agent of
the fees set forth herein and in the Fee Letter.
(m) Consents and Approvals. All governmental, shareholder,
partner, member and third-party consents and approvals necessary or, in
the opinion of the Administrative Agent, desirable in connection with
the Extensions of Credit and the transactions contemplated under the
Credit Documents shall have been duly obtained and shall be in full
force and effect, and a copy of each such consent or approval shall
have been delivered to the Administrative Agent.
(n) Due Diligence. Completion by the Lenders of all due
diligence with respect to the Combined Parties, including, but not
limited to, a review of all existing Indebtedness of the Combined
Parties and all Properties.
55
(o) Existing Credit Agreement. Receipt by the Administrative
Agent of satisfactory evidence of the repayment of all loans and
obligations under the Existing Credit Agreement and the termination of
the commitments thereunder.
(p) Other. Receipt by the Lenders of such other documents,
instruments, agreements or information as reasonably and timely
requested by any Lender, including, but not limited to, information
regarding litigation, tax, accounting, labor, insurance, pension
liabilities (actual or contingent), real estate leases, material
contracts, debt agreements, property ownership and contingent
liabilities of the Credit Parties and their Subsidiaries.
5.2 Conditions to All Extensions of Credit.
In addition to the conditions precedent stated elsewhere herein, the
Lenders shall not be obligated to make Loans nor shall an Issuing Lender be
required to issue or extend a Letter of Credit unless:
(a) Delivery of Notice. The Borrowers shall have delivered (i)
in the case of a Loan, a Notice of Borrowing, duly executed and
completed, by the time specified in Section 2.1 and (ii) in the case of
any Letter of Credit, to the Issuing Lender, an appropriate request for
issuance in accordance with the provisions of Section 2.2.
(b) Representations and Warranties. The representations and
warranties made by the Credit Parties in any Credit Document shall be
true and correct in all material respects at and as if made as of such
date except to the extent they expressly and exclusively relate to an
earlier date.
(c) No Default. No Default or Event of Default shall exist or
be continuing either prior to or after giving effect thereto.
(d) Availability. Immediately after giving effect to the
making of the requested Revolving Loan (and the application of the
proceeds thereof), or the issuance of a Letter of Credit, as the case
may be, (i) the sum of the Revolving Loans outstanding plus LOC
Obligations outstanding shall not exceed the Revolving Committed Amount
less, for any Property under construction and development that is less
than 50% preleased, the construction and development costs remaining to
be incurred for such Property unless and until outside construction
financing for the project is obtained (plus the amount of the requested
Revolving Loan, if such Revolving Loan is being used for such
construction and development costs), and (ii) the aggregate principal
amount of Revolving Loans outstanding at any one time for construction
and development of Properties shall not exceed (A) for such Properties
that are less than 50% preleased, $50,000,000 and (B) for all such
Properties, $100,000,000.
56
(e) Development and Construction. If the proceeds of the
requested Revolving Loan are to be used for development and
construction of a Property, the Borrowers have notified the
Administrative Agent with respect thereto.
(f) Restrictions on Loans. After giving effect to the making
of the requested Revolving Loan, the Borrowers shall be in compliance
with the terms of Section 2.1(f).
The delivery of each Notice of Borrowing and each request for issuance of a
Letter of Credit shall constitute a representation and warranty by the Borrowers
of the correctness of the matters specified in subsections (b), (c), (d) and, if
applicable, (e) and (f) above.
SECTION 6
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Administrative Agent and
each Lender that:
6.1 Financial Condition.
The financial statements delivered to the Lenders pursuant to Section
5.1(f) and Section 7.1(a) and (b): (a) have been prepared in accordance with
GAAP and (b) present fairly the consolidated financial condition, results of
operations and cash flows of the Credit Parties and their Subsidiaries as of
such date and for such periods. Other than the ▇▇▇▇▇▇▇▇ Transaction, since
December 31, 2000, there has been no sale, transfer or other disposition by any
Credit Party or any of its Subsidiaries of any material part of the business or
property of the Credit Parties and their Subsidiaries, taken as a whole, and no
purchase or other acquisition by any of them of any business or property
(including any capital stock or other equity interests of any other Person)
material in relation to the consolidated financial condition of the Credit
Parties and their Subsidiaries, taken as a whole, in each case, which, is not
(i) reflected in the most recent financial statements delivered to the Lenders
pursuant to Section 5.1(f) and Section 7.1 or in the notes thereto or (ii)
otherwise permitted by the terms of this Credit Agreement.
6.2 No Material Change.
Since the later of December 31, 2000 or the date of the last Revolving
Loan made under this Credit Agreement, there has been no development or event
relating to or affecting a Combined Party which has had or would be reasonably
expected to have a Material Adverse Effect.
6.3 Organization and Good Standing.
Each Credit Party (a) is either a partnership, a corporation, a limited
liability company or a REIT duly organized, validly existing and in good
standing under the laws of the state (or other jurisdiction) of its organization
or formation, (b) is duly qualified and in good standing as a foreign
partnership, a foreign corporation, a foreign limited liability company or a
foreign REIT and authorized to do business in every other jurisdiction where the
failure to be so qualified, in good standing or authorized would have or would
reasonably be expected to have a Material Adverse Effect and (c) has the power
and authority to own its properties and to carry on its business as now
conducted and as proposed to be conducted.
6.4 Due Authorization.
Each Credit Party (a) has the power and authority to execute, deliver
and perform this Credit Agreement and the other Credit Documents to which it is
a party and to incur the obligations herein and therein provided for and to
consummate the transactions contemplated herein and therein and (b) is duly
authorized, and has been authorized by all necessary action, to execute, deliver
and perform this Credit Agreement and the other Credit Documents to which it is
a party and to consummate the transactions contemplated herein and therein.
6.5 No Conflicts.
Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated herein and therein, nor the
performance of or compliance with the terms and provisions hereof and thereof by
a Credit Party will (a) violate or conflict with any provision of its
organizational or governing documents, (b) violate, contravene or materially
conflict with any Requirement of Law or any other law, regulation (including,
without limitation, Regulation U or Regulation X), order, writ, judgment,
injunction, decree or permit applicable to it, (c) violate, contravene or
conflict with contractual provisions of, or cause an event of default under, any
indenture, loan agreement, mortgage, deed of trust, contract or other agreement
or instrument to which it is a party or by which it may be bound, the violation
of which would have or would be reasonably expected to have a Material Adverse
Effect, or (d) result in or require the creation of any Lien upon or with
respect to its properties.
57
6.6 Consents.
Except for consents, approvals, authorizations and orders that have
been obtained, and filings, registrations and qualifications that have been
made, no consent, approval, authorization or order of, or filing, registration
or qualification with, any court or Governmental Authority or third party in
respect of any Credit Party is required in connection with the execution,
delivery or performance of this Credit Agreement or any of the other Credit
Documents by such Credit Party or the consummation of the transactions
contemplated herein and therein.
6.7 Enforceable Obligations.
This Credit Agreement and the other Credit Documents to which it is a
party have been duly executed and delivered and constitute legal, valid and
binding obligations of each Credit Party enforceable against such Credit Party
in accordance with their respective terms, except as may be limited by
bankruptcy or insolvency laws or similar laws affecting creditors' rights
generally or by general equitable principles.
6.8 No Default.
No Combined Party is in default in any respect under any contract,
lease, loan agreement, indenture, mortgage, security agreement or other
agreement or obligation to which it is a party or by which any of its properties
is bound which default would have or would be reasonably expected to have a
Material Adverse Effect. No Default or Event of Default has occurred or exists
except as previously disclosed in writing to the Lenders.
6.9 Ownership.
Each Credit Party and each of its Subsidiaries is the owner of, and has
good and marketable title to, all of its respective assets and none of such
assets is subject to any Lien other than Permitted Liens.
6.10 Indebtedness.
The Credit Parties and their Subsidiaries have no Indebtedness except
as otherwise permitted by this Credit Agreement.
6.11 Litigation.
There are no actions, suits or legal, equitable, arbitration or
administrative proceedings, pending or, to the knowledge of any Credit Party,
threatened, against a Combined Party which would have or would be reasonably
expected to have a Material Adverse Effect.
6.12 Taxes.
Each Credit Party, and each of its Subsidiaries, has filed, or caused
to be filed, all tax returns (federal, state, local and foreign) required to be
filed and has paid (a) all amounts of taxes shown thereon to be due (including
interest and penalties) and (b) all other taxes, fees, assessments and other
governmental charges (including mortgage recording taxes, documentary stamp
taxes and intangibles taxes) owing by it, except for such taxes (i) which are
not yet delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. No Credit Party is aware of any proposed tax assessments
against it or any of its Subsidiaries.
6.13 Compliance with Law.
Each Combined Party is in compliance with all Requirements of Law and
all other laws, rules, regulations, orders and decrees (including without
limitation Environmental Laws) applicable to it, or to its properties, unless
such failure to comply would not have or would not be reasonably expected to
have a Material Adverse Effect. No Requirement of Law would be reasonably
expected to cause a Material Adverse Effect.
58
6.14 Compliance with ERISA.
Except as would not result in or be reasonably expected to result in a
Material Adverse Effect:
(a) During the five-year period prior to the date on which
this representation is made or deemed made: (i) no ERISA Event has
occurred, and, to the best of each Credit Party's, each Subsidiary of a
Credit Party's and each ERISA Affiliate's knowledge, no event or
condition has occurred or exists as a result of which any ERISA Event
could reasonably be expected to occur, with respect to any Plan; (ii)
no "accumulated funding deficiency," as such term is defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, has
occurred with respect to any Plan; (iii) each Plan has been maintained,
operated, and funded in compliance with its own terms and in material
compliance with the provisions of ERISA, the Code, and any other
applicable federal or state laws; and (iv) no Lien in favor or the PBGC
or a Plan has arisen or is reasonably likely to arise on account of any
Plan.
(b) The actuarial present value of all "benefit liabilities"
(as defined in Section 4001(a)(16) of ERISA), whether or not vested,
under each Single Employer Plan, as of the last annual valuation date
prior to the date on which this representation is made or deemed made
(determined, in each case, in accordance with Financial Accounting
Standards Board Statement 87, utilizing the actuarial assumptions used
in such Plan's most recent actuarial valuation report), did not exceed
as of such valuation date the fair market value of the assets of such
Plan.
(c) No Credit Party, Subsidiary of a Credit Party or ERISA
Affiliate has incurred, or, to the best of each such party's knowledge,
is reasonably expected to incur, any withdrawal liability under ERISA
to any Multiemployer Plan or Multiple Employer Plan. No Credit Party,
Subsidiary of a Credit Party or ERISA Affiliate would become subject to
any withdrawal liability under ERISA if any such party were to withdraw
completely from all Multiemployer Plans and Multiple Employer Plans as
of the valuation date most closely preceding the date on which this
representation is made or deemed made. No Credit Party, Subsidiary of a
Credit Party or ERISA Affiliate has received any notification that any
Multiemployer Plan is in reorganization (within the meaning of Section
4241 of ERISA), is insolvent (within the meaning of Section 4245 of
ERISA), or has been terminated (within the meaning of Title IV of
ERISA), and no Multiemployer Plan is, to the best of each such party's
knowledge, reasonably expected to be in reorganization, insolvent, or
terminated.
59
(d) No prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected
or may subject any Credit Party, any Subsidiary of a Credit Party or
any ERISA Affiliate to any liability under Sections 406, 409, 502(i),
or 502(l) of ERISA or Section 4975 of the Code, or under any agreement
or other instrument pursuant to which any Credit Party, any Subsidiary
of a Credit Party or any ERISA Affiliate has agreed or is required to
indemnify any person against any such liability.
(e) No Credit Party, Subsidiary of a Credit Party or ERISA
Affiliate has material liability with respect to "expected
post-retirement benefit obligations" within the meaning of the
Financial Accounting Standards Board Statement 106. Each Plan which is
a welfare plan (as defined in Section 3(1) of ERISA) to which Sections
601-609 of ERISA and Section 4980B of the Code apply has been
administered in compliance in all material respects with such sections.
6.15 Organization Structure/Subsidiaries.
As of the Closing Date, (a) Schedule 6.15 is a complete and accurate
organization chart of the Combined Parties, and (b) no Credit Party has any
Subsidiaries or owns an interest, directly or indirectly, in any joint venture,
except as set forth on Schedule 6.15. The outstanding equity interest of all
Subsidiaries of the Credit Parties are validly issued, fully paid and
non-assessable and are owned by the Credit Parties free and clear of all Liens.
Schedule 6.15 shall be updated as of the end of each fiscal quarter as set forth
in Section 7.1(c).
6.16 Use of Proceeds; Margin Stock.
The proceeds of the Loans, and the Letters of Credit, will be used
solely for the purposes specified in Section 7.10. None of the proceeds of the
Loans, and none of the Letters of Credit, will be used in a manner that would
violate Regulation U, Regulation X, or Regulation T. No proceeds of the Loans,
and no Letter of Credit, will be used for the acquisition of another Person
unless the board of directors (or other comparable governing body) or
stockholders (or other equity owners), as appropriate, of such Person has
approved such acquisition.
6.17 Government Regulation.
No Credit Party, nor any of its Subsidiaries, is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Investment Company Act of 1940 or the Interstate Commerce Act, each as amended.
No director, executive officer or principal shareholder of a Credit Party or any
of its Subsidiaries is a director, executive officer or principal shareholder of
any Lender. For the purposes hereof the terms "director," "executive officer"
and "principal shareholder" (when used with reference to any Lender) have the
respective meanings assigned thereto in Regulation O.
60
6.18 Environmental Matters.
(a) Except as would not have or be reasonably expected to have
a Material Adverse Effect:
(i) Each of the Properties and all operations
at the Properties are in material compliance with all
applicable Environmental Laws, and there is no violation of
any Environmental Law with respect to the Properties or the
businesses operated by a Credit Party or any of its
Subsidiaries (the "Businesses"), and there are no conditions
relating to the Businesses or Properties that would be
reasonably expected to give rise to liability under any
applicable Environmental Laws.
(ii) No Credit Party, nor any of its
Subsidiaries, has received any written notice of, or inquiry
from any Governmental Authority regarding, any violation,
alleged violation, non-compliance, liability or potential
liability regarding Hazardous Materials or compliance with
Environmental Laws with regard to any of the Properties or the
Businesses, nor does any Credit Party or any of its
Subsidiaries have knowledge that any such notice is being
threatened.
(iii) Hazardous Materials have not been
transported or disposed of from the Properties, or generated,
treated, stored or disposed of at, on or under any of the
Properties or any other location, in each case by, or on
behalf or with the permission of, any Credit Party or any of
its Subsidiaries in a manner that would reasonably be expected
to give rise to liability under any applicable Environmental
Law.
(iv) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of any
Credit Party or any of its Subsidiaries, threatened, under any
Environmental Law to which any Credit Party or any of its
Subsidiaries is or will be named as a party, nor are there any
consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative
or judicial requirements outstanding under any Environmental
Law with respect to any Credit Party or any of its
Subsidiaries, the Properties or the Businesses, in any amount
reportable under the federal Comprehensive Environmental
Response, Compensation and Liability Act or any analogous
state law, except releases in compliance with all
Environmental Laws.
61
(v) There has been no release or threat of
release of Hazardous Materials at or from the Properties, or
arising from or related to the operations (including, without
limitation, disposal) of a Credit Party or any of its
Subsidiaries in connection with the Properties or otherwise in
connection with the Businesses except in compliance with
Environmental Laws.
(vi) None of the Properties contains, or to the
best knowledge of the Credit Parties and their Subsidiaries
has previously contained, any Hazardous Materials at, on or
under the Properties in amounts or concentrations that, if
released, constitute or constituted a violation of, or could
give rise to liability under, Environmental Laws.
(vii) No Credit Party, nor any of its
Subsidiaries, has assumed any liability of any Person (other
than a Borrower) under any Environmental Law.
(b) Each Credit Party, and each of its Subsidiaries, has
adopted procedures that are designed to (i) ensure that each such
party, any of its operations and each of the properties owned or leased
by such party remains in compliance with applicable Environmental Laws
and (ii) minimize any liabilities or potential liabilities that each
such party, any of its operations and each of the properties owned or
leased by each such party may have under applicable Environmental Laws.
62
6.19 Solvency.
Each Credit Party, is and, after consummation of the transactions
contemplated by this Credit Agreement, will be Solvent.
6.20 Investments.
All Investments of the Credit Parties and their Subsidiaries are
Permitted Investments.
6.21 Location of Properties.
As of the Closing Date, set forth on Schedule 6.21 is (a) a list of all
Properties (with street address, county and state where located) and the owner
of such Property and (b) a list of all Unsecured Properties. Schedule 6.21 shall
be updated as of the end of each fiscal quarter as set forth in Section 7.1(c).
6.22 Disclosure.
Neither this Credit Agreement nor any financial statements delivered to
the Lenders nor any other document, certificate or statement furnished to the
Lenders by or on behalf of any Credit Party in connection with the transactions
contemplated hereby contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained
therein or herein not misleading in light of the circumstances in which made;
provided, however, that the Credit Parties make no representation or warranty
regarding the information delivered pursuant to Section 7.1(i).
6.23 Licenses, etc.
The Combined Parties have obtained, and hold in full force and effect,
all franchises, licenses, permits, certificates, authorizations, qualifications,
accreditations, easements, rights of way and other rights, consents and
approvals which are necessary for the operation of their respective businesses
as presently conducted, except where the failure to obtain the same would not
have or would not reasonably be expected to have a Material Adverse Effect.
6.24 No Burdensome Restrictions.
No Combined Party is a party to any agreement or instrument or subject
to any other obligation or any charter or corporate restriction or any provision
of any applicable law, rule or regulation which, individually or in the
aggregate, would have or would be reasonably expected to have a Material Adverse
Effect.
63
6.25 Excluded Material Subsidiaries.
With respect to the Excluded Material Subsidiaries:
(a) Brandywine Holdings I, Inc. holds a nominal interest in
BOP to ensure that BOP will at all times have at least two partners,
and has no other activity and owns no other assets.
(b) Brandywine Realty Services Corporation ("BRSCO") provides
services to BOP and its Subsidiaries, as well as third parties, but
does not own any Properties. Although BOP owns ninety five percent of
the financial interest in BRSCO through ownership of common interests,
five percent of the common equity in BRSCO is held by a partnership in
which neither BOP nor BRT has any ownership.
(c) Each of The Association at Allendale, Inc., Greentree
Executive Campus 1001-03 Association, Inc. and Princeton Pike V, VI &
VII Condominium Association, Inc. is a non-profit corporation that
holds no assets and whose activities are limited to managing the common
spaces of its respective condominium property.
(d) Each of the remaining Excluded Materials Subsidiaries is
an entity which is subject to provisions in its charter documents that
require it to be a "bankruptcy remote" or "single purpose" entity and
therefore prohibit it from, among other things, guaranteeing or
becoming jointly and severally liable for the Indebtedness of others or
otherwise is excluded for the reasons set forth on Schedule 6.25.
64
SECTION 7
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect and until the Obligations have been paid in full
and the Commitments and Letters of Credit hereunder shall have terminated:
7.1 Information Covenants.
The Borrowers will furnish, or cause to be furnished, to the
Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as available, and in
any event within 90 days after the close of each fiscal year of the
Credit Parties, a consolidated balance sheet and income statement of
the Credit Parties and their Subsidiaries as of the end of such fiscal
year, together with related consolidated statements of operations and
retained earnings and of cash flows for such fiscal year, setting forth
in comparative form consolidated figures as of the end of and for the
preceding fiscal year, all such financial information described above
to be in reasonable form and detail and audited by independent
certified public accountants of recognized national standing reasonably
acceptable to the Administrative Agent and whose opinion shall be to
the effect that such financial statements have been prepared in
accordance with GAAP (except for changes with which such accountants
concur) and shall not be limited as to the scope of the audit or
qualified in any manner.
(b) Quarterly Financial Statements. As soon as available, and
in any event within 45 days after the close of each fiscal quarter of
the Credit Parties, a consolidated balance sheet and income statement
of the Credit Parties and their Subsidiaries, as of the end of such
fiscal quarter, together with related consolidated statements of
operations and retained earnings and of cash flows for such fiscal
quarter in each case setting forth in comparative form consolidated
figures for (A) the corresponding quarter end and quarterly period of
the preceding fiscal year and (B) management's proposed budget for such
period, all such financial information described above to be in
reasonable form and detail and reasonably acceptable to the
Administrative Agent, and accompanied by a certificate of the chief
financial officer of BOP to the effect that such quarterly financial
statements fairly present in all material respects the financial
condition and results of operations of the Credit Parties and their
Subsidiaries and have been prepared in accordance with GAAP, subject to
changes resulting from audit and normal year-end audit adjustments. The
information required pursuant to this subsection (b) shall be delivered
in both electronic and printed form.
(c) Officer's Certificate. At the time of delivery of the
financial statements provided for in Sections 7.1(a) and 7.1(b), a
certificate of the chief financial officer or chief executive officer
of BRT, substantially in the form of Exhibit 7.1(c), (i) demonstrating
compliance with the financial covenants contained in Section 7.2 by
calculation thereof as of the end of each such fiscal period, including
such detail and supporting documentation as reasonably requested by the
Administrative Agent (ii) stating that no Default or Event of Default
exists, or if any Default or Event of Default does exist, specifying
the nature and extent thereof and what action the Borrowers propose to
take with respect thereto, (iii) providing information regarding (A)
Investments in a manner to demonstrate compliance with Section 8.6, (B)
construction and development projects in a manner to demonstrate
compliance with Section 8.12 and (C) dividends and redemption of shares
in a manner to demonstrate compliance with Section 8.7 and (iv)
updating Schedule 6.15 and Schedule 6.21 as appropriate. Such
certificate shall be delivered in both electronic and printed form.
65
(d) Accountant's Certificate. Within the period for delivery
of the annual financial statements provided in Section 7.1(a), a
certificate of the accountants conducting the annual audit stating that
they have reviewed this Credit Agreement and stating further whether,
in the course of their audit, they have become aware of any Default or
Event of Default and, if any such Default or Event of Default exists,
specifying the nature and extent thereof.
(e) Annual Information and Projections. Within 30 days after
the end of each fiscal year of the Credit Parties, all such financial
information regarding the Credit Parties and their Subsidiaries and
specifically regarding the Properties, as the Administrative Agent
shall reasonably request, including, but not limited to, partnership,
limited liability company and joint venture agreements, property cash
flow projections, property budgets, actual and budgeted capital
expenditures, operating statements (current year and immediately
preceding year, if the Property existed as a Property in the
immediately preceding year), mortgage information, rent rolls, lease
expiration reports, leasing status reports, notes payable summary,
bullet notes summary, equity funding requirements, contingent liability
summary, lines of credit summary, lines of credit collateral summary,
wrap notes and notes receivable summary, schedule of outstanding
letters of credit, summary of cash and Cash Equivalents, projection of
management and leasing fees and overhead budgets.
(f) Auditor's Reports. Promptly upon receipt thereof, a copy
of any "management letter" submitted by independent accountants to any
Credit Party or any of its Subsidiaries in connection with any annual,
interim or special audit of the books of such Credit Party or any of
its Subsidiaries.
(g) Reports. Promptly, (i) and in any case within five (5)
days of receipt or transmission thereof, copies of any filings and
registrations with, and reports to or from, the Securities and Exchange
Commission, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports as any Credit Party
or any of its Subsidiaries shall send to its shareholders, members or
partners generally, (ii) and in any case within ten (10) days of filing
thereof, copies of all income tax returns filed by a Credit Party and
(iii) upon the written request of the Administrative Agent, all reports
and written information to and from the United States Environmental
Protection Agency, or any state or local agency responsible for
environmental matters, the United States Occupational Health and Safety
Administration, or any state or local agency responsible for health and
safety matters, or any successor agencies or authorities concerning
environmental, health or safety matters; provided, however, that if any
such transmissions are done electronically, the Borrowers shall instead
promptly notify the Administrative Agent of same and provide
information on how to retrieve such information.
66
(h) Notices. Upon a Credit Party obtaining knowledge thereof,
such Credit Party will give written notice to the Administrative Agent
(which shall promptly forward such notice to the Lenders) immediately
of (i) the occurrence of an event or condition consisting of a Default
or Event of Default, specifying the nature and existence thereof and
what action the Credit Parties propose to take with respect thereto,
(ii) the occurrence of any of the following with respect to any Credit
Party or any of its Subsidiaries: (A) the pendency or commencement of
any litigation or arbitral or governmental proceeding against any
Credit Party or any of its Subsidiaries which if adversely determined
would have or would be reasonably expected to have a Material Adverse
Effect, (B) the institution of any proceedings against any Credit Party
or any of its Subsidiaries with respect to, or the receipt of notice by
such Person of potential liability or responsibility for, violation, or
alleged violation, of any federal, state or local law, rule or
regulation, including, but not limited to, Environmental Laws, the
violation of which would have or would be reasonably expected to have a
Material Adverse Effect or (C) the occurrence of any default or
nonpayment of nonrecourse Indebtedness of a Credit Party in an
aggregate principal amount in excess of $10,000,000 and (iii) the
occurrence of any enforcement or notice to enforce a completion
guaranty and within five Business Days thereafter provide evidence that
the remaining costs to complete the applicable project are covered by a
construction loan and/or surety bond.
(i) ERISA. Upon a Credit Party or any ERISA Affiliate
obtaining knowledge thereof, the Credit Parties will give written
notice to the Administrative Agent promptly (and in any event within
five Business Days) of: (i) any event or condition, including, but not
limited to, any Reportable Event, that constitutes, or might reasonably
lead to, an ERISA Event; (ii) with respect to any Multiemployer Plan,
the receipt of notice as prescribed in ERISA or otherwise of any
withdrawal liability assessed against a Credit Party, any Subsidiary of
a Credit Party or any ERISA Affiliate, or of a determination that any
Multiemployer Plan is in reorganization or insolvent (both within the
meaning of Title IV of ERISA); (iii) the failure to make full payment
on or before the due date (including extensions) thereof of all amounts
which a Credit Party, any Subsidiary of a Credit Party or any ERISA
Affiliate is required to contribute to each Plan pursuant to its terms
and as required to meet the minimum funding standard set forth in ERISA
and the Code with respect thereto; or (iv) any change in the funding
status of any Plan that could have a Material Adverse Effect; in each
case together, with a description of any such event or condition or a
copy of any such notice and a statement by the chief financial officer
of the Borrowers briefly setting forth the details regarding such
event, condition, or notice, and the action, if any, which has been or
is being taken or is proposed to be taken by such Credit Party,
Subsidiary or ERISA Affiliate with respect thereto. Promptly upon
request, the Credit Parties shall furnish the Administrative Agent and
the Lenders with such additional information concerning any Plan as may
be reasonably requested, including, but not limited to, copies of each
annual report/return (Form 5500 series), as well as all schedules and
attachments thereto required to filed with the Department of Labor
and/or the Internal Revenue Service pursuant to ERISA and the Code,
respectively, for each "plan year" (within the meaning of Section 3(39)
of ERISA).
67
(j) Environmental.
-------------
(i) Subsequent to a notice from any
Governmental Authority that would reasonably cause concern or
during the existence of an Event of Default, and upon the
written request of the Administrative Agent, the Credit
Parties will furnish or cause to be furnished to the
Administrative Agent, at the Credit Parties' expense, an
updated report of an environmental assessment of reasonable
scope, form and depth, including, where appropriate, invasive
soil or groundwater sampling, by a consultant reasonably
acceptable to the Administrative Agent as to the nature and
extent of the presence of any Hazardous Materials on any
Property and as to the compliance by the Credit Parties with
Environmental Laws. If the Credit Parties fail to deliver such
an environmental report within seventy-five (75) days after
receipt of such written request then the Administrative Agent
may arrange for same, and the Credit Parties hereby grant to
the Administrative Agent and its representatives access to the
Properties and a license of a scope reasonably necessary to
undertake such an assessment (including, where appropriate,
invasive soil or groundwater sampling). The reasonable cost of
any assessment arranged for by the Administrative Agent
pursuant to this provision will be payable by the Credit
Parties on demand and added to the Obligations.
(ii) Each of the Credit Parties and their
Subsidiaries will conduct and complete all investigations,
studies, sampling, and testing and all remedial, removal, and
other actions necessary to address all Hazardous Materials on,
from, or affecting any Property to the extent necessary to be
in compliance with all Environmental Laws and all other
applicable federal, state, and local laws, regulations, rules
and policies and with the orders and directives of all
Governmental Authorities exercising jurisdiction over such
Property to the extent any failure would have or would be
reasonably expected to have a Material Adverse Effect.
(k) Other Information. With reasonable promptness upon any
such request, such other information regarding the Properties or
regarding the business, assets or financial condition of the Credit
Parties and their Subsidiaries as the Administrative Agent or any
Lender may reasonably request.
68
7.2 Financial Covenants.
(a) Debt Service Coverage Ratio. The Debt Service Coverage
Ratio, as of the end of each fiscal quarter of the Credit Parties,
shall be greater than or equal to 1.50 to 1.0.
(b) Interest Coverage Ratio. The Interest Coverage Ratio, as
of the end of each fiscal quarter of the Credit Parties for the twelve
month period ending on such date, shall be greater than or equal to
2.25 to 1.0.
(c) Fixed Charge Coverage Ratio. The Fixed Charge Coverage
Ratio, as of the end of each fiscal quarter of the Credit Parties for
the twelve month period ending on such date, shall be greater than or
equal to 1.75 to 1.0.
(d) Net Worth. At all times, Net Worth shall be greater than
or equal to the sum of (i) $700,000,000 plus (ii) 85% of the Net Cash
Proceeds from all Equity Issuances after the Closing Date (other than
Equity Issuances referred to in the following subclause (iii)) plus
(iii) 85% of the actual increase in Net Worth (if any) resulting from
an Equity Issuance after the Closing Date made in connection with an
Incentive Stock Plan.
(e) Leverage Ratio. The Leverage Ratio, as of the end of each
fiscal quarter of the Credit Parties, shall be less than or equal to
.55 to 1.0.
(f) Unsecured Debt Ratio. The Unsecured Debt Ratio, as of the
end of each fiscal quarter of the Credit Parties, shall be greater than
or equal to 2.0 to 1.0.
(g) Secured Debt Ratio. The Secured Debt Ratio, as of the end
of each fiscal quarter of the Credit Parties, shall be less than or
equal to .40 to 1.0.
(h) Unencumbered Cash Flow Ratio. The Unencumbered Cash Flow
Ratio, as of the end of each fiscal quarter of the Credit Parties,
shall be greater than or equal to 1.65 to 1.0.
(i) Credit Party Assets. At all times, at least 65% of Total
Assets must be owned by the Credit Parties.
7.3 Preservation of Existence.
Each of the Credit Parties will do all things necessary to preserve and
keep in full force and effect its existence, rights, franchises and authority
except as permitted by Section 8.4. Without limiting the generality of the
foregoing, BRT will do all things necessary to maintain its status as a REIT.
7.4 Books and Records.
Each of the Credit Parties will, and will cause its Subsidiaries to,
keep complete and accurate books and records of its transactions in accordance
with good accounting practices on the basis of GAAP (including the establishment
and maintenance of appropriate reserves).
69
7.5 Compliance with Law.
Each of the Credit Parties will, and will cause its Subsidiaries to,
comply in all material respects with all material laws, rules, regulations and
orders, and all applicable material restrictions imposed by all Governmental
Authorities, applicable to it and its property (including, without limitation,
Environmental Laws and ERISA).
7.6 Payment of Taxes and Other Indebtedness.
Each of the Credit Parties will, and will cause its Subsidiaries to,
pay, settle or discharge (a) all taxes, assessments and governmental charges or
levies imposed upon it, or upon its income or profits, or upon any of its
properties, before they shall become delinquent, (b) all lawful claims
(including claims for labor, materials and supplies) which, if unpaid, might
give rise to a Lien upon any of its properties, and (c) except as prohibited
hereunder, all of its other Indebtedness as it shall become due; provided,
however, that a Credit Party or any of its Subsidiaries shall not be required to
pay any such tax, assessment, charge, levy, claim or Indebtedness which is being
contested in good faith by appropriate proceedings and as to which adequate
reserves therefor have been established in accordance with GAAP, unless the
failure to make any such payment (i) would give rise to an immediate right to
foreclose on a Lien securing such amounts or (ii) would have a Material Adverse
Effect.
7.7 Insurance.
Each of the Credit Parties will, and will cause its Subsidiaries to, at
all times maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance, casualty insurance and business
interruption insurance) in such amounts, covering such risks and liabilities and
with such deductibles or self-insurance retentions as are in accordance with
normal industry practice.
7.8 Maintenance of Assets.
Each of the Credit Parties will, and will cause its Subsidiaries to,
maintain and preserve its Properties and all other assets in good repair,
working order and condition, normal wear and tear excepted, and will make, or
cause to be made, in the Properties and other assets, from time to time, all
repairs, renewals, replacements, extensions, additions, betterments and
improvements thereto as may be needed or proper, to the extent and in the manner
customary for companies in similar businesses.
7.9 Performance of Obligations.
Each of the Credit Parties will, and will cause its Subsidiaries to,
perform in all material respects all of its obligations under the terms of all
material agreements, indentures, mortgages, security agreements or other debt
instruments to which it is a party or by which it is bound.
70
7.10 Use of Proceeds.
The Credit Parties will use the proceeds of the Loans solely (a) to
refinance the Indebtedness under the Existing Credit Agreement, (b) to acquire
Properties, (c) to renovate existing Properties, (d) to develop and construct
Properties subject to the limitations set forth in this Credit Agreement and (e)
for general working capital in the ordinary course (including the payment of
dividends if such payment is otherwise in compliance with the terms of this
Credit Agreement); provided that it is understood that proceeds of Loans may not
be used to acquire undeveloped land if, after giving effect to such acquisition,
the Credit Parties' aggregate ownership of undeveloped land exceeds 5% of Total
Assets, unless such land is adjacent or contiguous with other assets being
acquired or already owned or such land is part of a construction project
approved by the Required Lenders and has all necessary local permits and
approvals and construction will commence within six months of acquisition. The
Credit Parties will use the Letters of Credit solely for the purposes set forth
in Section 2.2(a).
7.11 Audits/Inspections.
Upon reasonable notice and during normal business hours, each Credit
Party will, and will cause its Subsidiaries to, permit representatives appointed
by the Administrative Agent, including, without limitation, independent
accountants, agents, attorneys and appraisers to visit and inspect such Credit
Party's or other Combined Party's property, including, without limitation, the
Properties, its books and records, its accounts receivable and inventory, its
facilities and its other business assets, and to make photocopies or photographs
thereof and to write down and record any information such representative obtains
and shall permit the Administrative Agent or its representatives to investigate
and verify the accuracy of information provided to the Lenders, and to discuss
all such matters with the officers, employees and representatives of the Credit
Parties, their Subsidiaries and any other Combined Party.
7.12 Additional Credit Parties.
At any time a Person that is not a Credit Party becomes a Material
Subsidiary (other than, subject to Section 7.2(i), Excluded Material
Subsidiaries or any entity which is subject to provisions in its charter
documents that prohibit it from guaranteeing or becoming jointly and severally
liable for the Indebtedness of others), the Borrowers shall notify the
Administrative Agent and promptly thereafter (but in any event within 30 days
after such Person becomes a Material Subsidiary): (a) execute a Joinder
Agreement in substantially the form of Exhibit 7.12 and (b) deliver such other
documentation as the Administrative Agent may reasonably request in connection
with the foregoing, including, without limitation, information regarding the
real property owned by such Person, certified resolutions and other
organizational and authorizing documents of such Person and favorable opinions
of counsel to such Person (which shall cover, among other things, the legality,
validity, binding effect and enforceability of the documentation referred to
above), all in form, content and scope reasonably satisfactory to the
Administrative Agent.
71
7.13 Interest Rate Protection Agreements.
If for any consecutive period of 30 days or more Eurodollar Loans
constitute less than 75% of the aggregate principal amount of all outstanding
Revolving Loans, then the Borrowers shall enter into interest rate protection
agreements in form and substance acceptable to the Administrative Agent.
7.14 Construction.
With respect to any construction and development engaged in by the
Combined Parties, the Credit Parties shall or shall cause another Person to: (a)
comply with all applicable regulations and codes and (b) complete all such
construction and development in accordance with approved plans and
specifications.
7.15 Acquisitions.
If, at the time a Credit Party or one of its Subsidiaries anticipates
making an Investment or an acquisition in excess of $20 million, there are any
Revolving Loans outstanding or LOC Obligations outstanding, then ten Business
Days prior to such Credit Party (or Subsidiary) making such Investment or
acquisition, the Borrowers shall provide the Administrative Agent written notice
of such Investment or acquisition, together with a certification as to
compliance with the terms of this Credit Agreement, including, without
limitation, Section 7.2 (on a Pro Forma Basis), after giving effect to such
Investment or acquisition. If there are no Revolving Loans or LOC Obligations
outstanding, the Borrowers shall give the Administrative Agent written notice of
such Investment or acquisition by a Credit Party and such compliance
certification within five Business Days after the occurrence of such Investment
or acquisition.
SECTION 8
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that so long as this
Credit Agreement is in effect and until the Obligations have been paid in full
and the Commitments and Letters of Credit hereunder shall have terminated:
8.1 Indebtedness.
No Credit Party will, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the
other Credit Documents;
(b) Indebtedness owing from one Credit Party to another Credit
Party;
72
(c) Indebtedness in respect of current accounts payable and
accrued expenses incurred in the ordinary course of business; and
(d) Other Indebtedness as long as, prior to and after giving
effect thereto, the Credit Parties are otherwise in compliance with the
terms of this Credit Agreement.
8.2 Liens.
No Credit Party will, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Lien with respect to any
of its Properties or any other assets of any kind (whether real or personal,
tangible or intangible), whether now owned or after acquired, except for
Permitted Liens.
8.3 Nature of Business.
No Credit Party will, nor will it permit any of its Subsidiaries to,
alter the character of its business from that conducted as of the Closing Date
or engage in any business other than the business conducted as of the Closing
Date.
8.4 Consolidation and Merger.
No Credit Party will enter into any transaction of merger or
consolidation or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution); provided that notwithstanding the foregoing
provisions of this Section 8.4, (a) any Credit Party may be merged or
consolidated with or into another Credit Party; provided that (i) if the
transaction is between a Borrower and another Credit Party such Borrower is the
continuing or surviving entity; (ii) the Administrative Agent is given prior
written notice of such action, and the Credit Parties execute and deliver such
documents, instruments and certificates as the Administrative Agent may
reasonably request; and (iii) after giving effect thereto no Default or Event of
Default exists and (b) upon prior written notification to the Administrative
Agent, as long as no Default or Event of Default exists, a Credit Party that has
no assets and no revenues may be dissolved or liquidated.
8.5 Sale or Lease of Assets.
(a) No Property may be conveyed, sold, leased, transferred or
otherwise disposed of unless, after giving effect thereto, (i) the
Credit Parties are in compliance on a Pro Forma Basis with the
financial covenants set forth in Section 7.2 and (ii) no Default or
Event of Default exists.
73
(b) No equity interest in any Guarantor may be conveyed, sold,
transferred or otherwise disposed of unless, after giving effect
thereto, (i) the Credit Parties are in compliance on a Pro Forma Basis
with the financial covenants set forth in Section 7.2 and (ii) no
Default or Event of Default exists. Any sale of an equity interest in a
Borrower shall be subject to Section 9.1(i). Upon the sale of an equity
interest in a Guarantor in conformance with the terms hereof, if after
the sale of such equity interest such Guarantor is no longer a Material
Subsidiary the Lenders agree to release such Guarantor from its
obligations hereunder, and the Lenders hereby consent to the
Administrative Agent executing and delivering such releases as
necessary to give effect to such agreement.
8.6 Advances, Investments and Loans.
Neither the Credit Parties nor any of their Subsidiaries will (a) make
any Investments except for Permitted Investments or (b) so long as Brandywine
Realty Services Partnership ("BRSP") is named in Section 2.5, make any
Investments in BRSP (whether or not such Investment would otherwise be a
Permitted Investment) or otherwise cause or permit BRSP to be a Subsidiary of
any Credit Party.
8.7 Restricted Payments.
(a) No Credit Party will, directly or indirectly, declare or
pay any dividends or make any other distribution upon any of its shares
of beneficial interests or any shares of its capital stock of any class
or with respect to any of its membership or partnership interests;
provided that (i) BRT may make distributions in an amount not to
exceed, in the aggregate, the greater of (A) 90% of Funds From
Operations earned subsequent to March 31, 2001 or (B) the minimum
amount necessary for BRT to maintain its status as a REIT; and (ii) any
Subsidiary of a Credit Party may pay dividends or make distributions to
its equity holders.
(b) Except as permitted by Section 8.6 and except for the
conversion of partnership units of BOP into cash or into shares of
beneficial interest of BRT, no Credit Party will, nor will it permit
any of its Subsidiaries to, at any time, for cash, purchase, redeem or
otherwise acquire or retire or make any provisions for redemption,
acquisition or retirement of any shares of its capital stock of any
class or any warrants or options to purchase any such shares or with
respect to any of its partnership or membership interests.
8.8 Transactions with Affiliates.
No Credit Party will, nor will it permit any of its Subsidiaries to,
enter into any transaction or series of transactions, whether or not in the
ordinary course of business, with any officer, director, shareholder, Subsidiary
or Affiliate other than on terms and conditions substantially as favorable as
would be obtainable in a comparable arm's-length transaction with a Person other
than an officer, director, shareholder, Subsidiary or Affiliate.
74
8.9 Fiscal Year; Organizational Documents.
No Credit Party will (a) change its fiscal year or (b) change its
articles or certificate of incorporation, its bylaws, its declaration of trust,
its limited liability company agreement, its articles or certificate of
partnership or partnership agreement or any other organization or formation
documents in any manner that would have an adverse effect of the rights of the
Lenders under the Credit Documents; provided that (i) BRT may take such action,
with prior written notice to the Administrative Agent, as is necessary to
maintain its status as a REIT and (ii) the Credit Parties will provide prompt
written notice to the Administrative Agent of any change to be made in
compliance with the terms of this Section 8.9.
8.10 Limitations.
No Credit Party will, nor will it permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause, incur, assume, suffer or
permit to exist or become effective any consensual encumbrance or restriction of
any kind on the ability of any such Person to pay any Indebtedness owed to the
Credit Parties.
8.11 Other Negative Pledges.
The Credit Parties will not enter into, assume or become subject to any
agreement prohibiting or otherwise restricting the creation or assumption of any
Lien upon its properties or assets, whether now owned or hereafter acquired, or
requiring the grant of any security for such obligation if security is given for
some other obligation except as provided under the Credit Documents; provided
that a Credit Party may agree with a joint venture partner not to pledge its
equity interest in such joint venture.
8.12 Construction and Development.
The Credit Parties shall not engage in construction and development
projects in which the total project costs incurred as of the date of
determination of all such concurrent construction and development projects
exceed, in the aggregate at any one time, 15% of Total Assets (it being
understood and agreed for purposes of this Section 8.12 that a project shall be
considered under construction and/or development until a certificate of
occupancy therefor (or other similar certificate) shall have been issued by the
applicable Governmental Authority).
75
SECTION 9
EVENTS OF DEFAULT
9.1 Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) Payment. The Credit Parties shall default in the payment
(i) when due of any principal amount of any Loans or any reimbursement
obligation arising from drawings under Letters of Credit or (ii) within
three days of when due of any interest on the Loans or any fees or
other amounts owing hereunder, under any of the other Credit Documents
or in connection herewith.
(b) Representations. Any representation, warranty or statement
made or deemed to be made by any Credit Party herein, in any of the
other Credit Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove untrue
in any material respect on the date as of which it was made or deemed
to have been made or delivered.
(c) Covenants. Any Credit Party shall:
(i) default in the due performance or
observance of any term, covenant or agreement contained in
Sections 7.2, 7.3, 7.10, 7.11, 7.12, 7.14 or 8.1 through 8.12
inclusive; provided that if the Credit Parties fail to comply
with Section 7.2(e) solely as a result of a change in the
Capitalization Rate by the Required Lenders, a Default or an
Event of Default shall not exist unless the Credit Parties
also fail to comply with Section 7.2(e) as of the last day of
any subsequent fiscal quarter of the Credit Parties; or
(ii) default in the due performance or
observance by it of any term, covenant or agreement contained
in Section 7.1 and such default shall continue unremedied for
a period of five Business Days after the earlier of a Credit
Party becoming aware of such default or notice thereof given
by the Administrative Agent; or
(iii) default in the due performance or
observance by it of any term, covenant or agreement (other
than those referred to in subsections (a), (b) or (c)(i) or
(ii) of this Section 9.1) contained in this Credit Agreement
and such default shall continue unremedied for a period of at
least 30 days after the earlier of a Credit Party becoming
aware of such default or notice thereof given by the
Administrative Agent.
76
(d) Other Credit Documents. (i) Any Credit Party shall default
in the due performance or observance of any term, covenant or agreement
in any of the other Credit Documents and such default shall continue
unremedied for a period of at least 30 days after the earlier of a
Credit Party becoming aware of such default or notice thereof given by
the Administrative Agent or (ii) any Credit Document (or any provision
of any Credit Document, including Section 4 of this Credit Agreement)
shall fail to be in full force and effect or any Credit Party shall so
assert or any Credit Document shall fail to give the Administrative
Agent and/or the Lenders the security interests, liens, rights, powers
and privileges purported to be created thereby.
(e) Bankruptcy, etc. The occurrence of any of the following
with respect to any Credit Party or any of its Subsidiaries: (i) a
court or Governmental Authority having jurisdiction in the premises
shall enter a decree or order for relief in respect of any Credit Party
or any of its Subsidiaries in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect,
or appoint a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of any Credit Party or any of its
Subsidiaries or for any substantial part of its property or ordering
the winding up or liquidation of its affairs; or (ii) an involuntary
case under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect is commenced against any Credit Party or any
of its Subsidiaries and such petition remains unstayed and in effect
for a period of 60 consecutive days; or (iii) any Credit Party or any
of its Subsidiaries shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the appointment or
taking possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of such Person or any
substantial part of its property or make any general assignment for the
benefit of creditors; or (iv) any Credit Party or any of its
Subsidiaries shall admit in writing its inability to pay its debts
generally as they become due or any action shall be taken by such
Person in furtherance of any of the aforesaid purposes.
(f) Defaults under Other Agreements. With respect to any
recourse Indebtedness (other than Indebtedness outstanding under this
Credit Agreement) of any Credit Party or any of its Subsidiaries in an
aggregate principal amount in excess of $10,000,000, (i) a Credit Party
or one of its Subsidiaries shall (A) default in any payment (beyond the
applicable grace period with respect thereto, if any) with respect to
any such recourse Indebtedness, or (B) default (after giving effect to
any applicable grace period) in the observance or performance of any
term, covenant or agreement relating to such recourse Indebtedness or
contained in any instrument or agreement evidencing, securing or
relating thereto, or any other event or condition shall occur or
condition exist, the effect of which default or other event or
condition is to cause, or permit, the holder or holders of such
recourse Indebtedness (or a trustee or agent on behalf of such holders)
to cause (determined without regard to whether any notice or lapse of
time is required) any such recourse Indebtedness to become due prior to
its stated maturity; or (ii) any such recourse Indebtedness shall be
declared due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment prior to the stated maturity
thereof; or (iii) any such Indebtedness shall mature and remain unpaid.
With respect to any nonrecourse Indebtedness of any Credit Party or any
of its Subsidiaries in an aggregate principal amount in excess of
$20,000,000, a default in payment (whether by acceleration or
otherwise) shall occur and such payment default is not cured or waived
within sixty days after the occurrence thereof.
(g) Judgments. One or more judgments, orders, or decrees shall
be entered against any one or more of any Credit Party or any of its
Subsidiaries involving a liability of $10,000,000 or more, in the
aggregate (to the extent not paid or covered by insurance provided by a
carrier who has acknowledged coverage), and such judgments, orders or
decrees (i) are the subject of any enforcement proceeding commenced by
any creditor or (ii) shall continue unsatisfied, undischarged and
unstayed for a period ending on the first to occur of (A) the last day
on which such judgment, order or decree becomes final and unappealable
or (B) 20 days.
77
(h) ERISA Events. The occurrence of any of the following
events or conditions, unless such event or occurrence would not have or
be reasonably expected to have a Material Adverse Effect: (1) any
"accumulated funding deficiency," as such term is defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, shall
exist with respect to any Plan, or any lien shall arise on the assets
of a Credit Party, any Subsidiary of a Credit Party or any ERISA
Affiliate in favor of the PBGC or a Plan; (2) an ERISA Event shall
occur with respect to a Single Employer Plan, which is, in the
reasonable opinion of the Administrative Agent, likely to result in the
termination of such Plan for purposes of Title IV of ERISA; (3) an
ERISA Event shall occur with respect to a Multiemployer Plan or
Multiple Employer Plan, which is, in the reasonable opinion of the
Administrative Agent, likely to result in (i) the termination of such
Plan for purposes of Title IV of ERISA, or (ii) a Credit Party, any
Subsidiary of a Credit Party or any ERISA Affiliate incurring any
liability in connection with a withdrawal from, reorganization of
(within the meaning of Section 4241 of ERISA), or insolvency (within
the meaning of Section 4245 of ERISA) of such Plan; or (4) any
prohibited transaction (within the meaning of Section 406 of ERISA or
Section 4975 of the Code) or breach of fiduciary responsibility shall
occur which may subject a Credit Party, any Subsidiary of a Credit
Party or any ERISA Affiliate to any liability under Sections 406, 409,
502(i), or 502(l) of ERISA or Section 4975 of the Code, or under any
agreement or other instrument pursuant to which a Credit Party, any
Subsidiary of a Credit Party or any ERISA Affiliate has agreed or is
required to indemnify any person against any such liability.
(i) Ownership. There shall occur a Change of Control.
(j) Management. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ is no longer active in the
management of the Credit Parties and their Subsidiaries; provided that
upon the death or disability of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, the Credit Parties and
their Subsidiaries shall have six months to provide the Administrative
Agent with substitute personnel as replacement, such substitute
personnel to be acceptable to the Administrative Agent in its sole
reasonable discretion.
(k) REIT Status. BRT does not maintain its REIT status or is
no longer deemed to be a REIT.
9.2 Acceleration; Remedies.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived in writing by the
Required Lenders (or the Lenders as may be required hereunder), the
Administrative Agent shall, upon the request and direction of the Required
Lenders, by written notice to the Borrowers, take any of the following actions
without prejudice to the rights of the Administrative Agent or any Lender to
enforce its claims against the Borrowers, except as otherwise specifically
provided for herein:
78
(a) Termination of Commitments. Declare the Commitments
terminated whereupon the Commitments shall be immediately terminated.
(b) Acceleration of Loans. Declare the unpaid principal of and
any accrued interest in respect of all Loans, any reimbursement
obligations arising from drawings under Letters of Credit and any and
all other indebtedness or obligations of any and every kind owing by a
Credit Party to any of the Lenders hereunder to be due whereupon the
same shall be immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by
the Credit Parties.
(c) Cash Collateral. Direct the Credit Parties to pay (and the
Credit Parties agree that upon receipt of such notice, or upon the
occurrence of an Event of Default under Section 9.1(e), they will
immediately pay) to the Administrative Agent additional cash, to be
held by the Administrative Agent, for the benefit of the Lenders, in a
cash collateral account as additional security for the LOC Obligations
in respect of subsequent drawings under all then outstanding Letters of
Credit in an amount equal to the maximum aggregate amount which may be
drawn under all Letters of Credits then outstanding.
(d) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Credit Documents, including,
without limitation, all rights and remedies against a Guarantor and all
rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in Section
9.1(e) shall occur, then the Commitments shall automatically terminate and all
Loans, all accrued interest in respect thereof, all accrued and unpaid fees, all
reimbursement obligations under Letters of Credit and all other indebtedness or
obligations owing to the Lenders hereunder shall immediately become due and
payable without the giving of any notice or other action by the Administrative
Agent or the Lenders, which notice or other action is expressly waived by the
Credit Parties.
Notwithstanding the fact that enforcement powers reside primarily with the
Administrative Agent, each Lender has, to the extent permitted by law, a
separate right of payment and shall be considered a separate "creditor" holding
a separate "claim" within the meaning of Section 101(5) of the Bankruptcy Code
or any other insolvency statute.
79
9.3 Allocation of Payments After Event of Default.
Notwithstanding any other provisions of this Credit Agreement, after
the occurrence and during the continuance of an Event of Default, all amounts
collected or received by the Administrative Agent or any Lender on account of
amounts outstanding under any of the Credit Documents shall be paid over or
delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Administrative Agent in connection with enforcing the rights of
the Lenders under the Credit Documents;
SECOND, to payment of any fees owed to the Administrative
Agent;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses, (including, without limitation, reasonable attorneys'
fees) of each of the Lenders in connection with enforcing its rights
under the Credit Documents;
FOURTH, to the payment of all accrued fees and interest
payable to the Lenders hereunder;
FIFTH, to the payment of the outstanding principal amount of
the Loans, and, with respect to unreimbursed drawings under Letters of
Credit, to the payment or cash collateralization of the outstanding LOC
Obligations pro rata, as set forth below;
SIXTH, to all other obligations which shall have become due
and payable under the Credit Documents and not repaid pursuant to
clauses "FIRST" through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whoever may
be lawfully entitled to receive such surplus.
In carrying out the foregoing, (a) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (b) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans and
LOC Obligations held by such Lender bears to the aggregate then outstanding
Loans and LOC Obligations) of amounts available to be applied pursuant to
clauses "THIRD", "FOURTH," "FIFTH," and "SIXTH" above and (c) to the extent that
any amounts available for distribution pursuant to clause "FIFTH" above are
attributable to the issued but undrawn amount of outstanding Letters of Credit,
such amounts shall be held by the Administrative Agent in a cash collateral
account and applied (x) first, to reimburse the Issuing Lender from time to time
for any drawings under such Letters of Credit and (y) then, following the
expiration of all Letters of Credit, to all other obligations of the types
described in clauses "FIFTH" and "SIXTH" above in the manner provided in this
Section 9.3.
80
SECTION 10
AGENCY PROVISIONS
10.1 Appointment.
Each Lender hereby designates and appoints Bank of America, N.A. as
Administrative Agent of such Lender to act as specified herein and in the other
Credit Documents, and each Lender hereby authorizes the Administrative Agent, as
the agent for such Lender, to take such action on its behalf under the
provisions of this Credit Agreement and the other Credit Documents and to
exercise such powers and perform such duties as are expressly delegated by the
terms hereof and of the other Credit Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any provision to the
contrary elsewhere herein and in the other Credit Documents, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein and therein, or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Credit Agreement or any of the other Credit
Documents, or shall otherwise exist against the Administrative Agent. The
provisions of this Section are solely for the benefit of the Administrative
Agent and the Lenders and none of the Credit Parties shall have any rights as a
third party beneficiary of the provisions hereof. In performing its functions
and duties under this Credit Agreement and the other Credit Documents, the
Administrative Agent shall act solely as an agent of the Lenders and does not
assume and shall not be deemed to have assumed any obligation or relationship of
agency or trust with or for any Credit Parties.
10.2 Delegation of Duties.
The Administrative Agent may execute any of its duties hereunder or
under the other Credit Documents by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable
care.
10.3 Exculpatory Provisions.
No Agent-Related Person shall be (a) liable for any action lawfully
taken or omitted to be taken by it under or in connection herewith or in
connection with any of the other Credit Documents (except for such Person's own
gross negligence or willful misconduct) or (b) responsible in any manner to any
of the Lenders for any recitals, statements, representations or warranties made
by any of the Credit Parties contained herein or in any of the other Credit
Documents or in any certificate, report, document, financial statement or other
written or oral statement referred to or provided for in, or received by an
Agent-Related Person under or in connection herewith or in connection with the
other Credit Documents, or the enforceability or sufficiency of this Credit
Agreement or any of the other Credit Documents, or for any failure of the Credit
Parties to perform their obligations hereunder or thereunder. No Agent-Related
Person shall be responsible to any Lender for the effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Credit
Agreement, or any of the other Credit Documents or for any representations,
warranties, recitals or statements made herein or therein or made by the Credit
Parties in any written or oral statement or in any financial or other
statements, instruments, reports, certificates or any other documents in
connection herewith or therewith furnished or made by an Agent-Related Person to
the Lenders or by or on behalf of the Credit Parties to an Agent-Related Person
or any Lender or be required to ascertain or inquire as to the performance or
observance of any of the terms, conditions, provisions, covenants or agreements
contained herein or therein or as to the use of the proceeds of the Loans or the
use of the Letters of Credit or of the existence or possible existence of any
Default or Event of Default or to inspect the properties, books or records of
the Credit Parties. No Agent-Related Person is a trustee for the Lenders or owes
any fiduciary duty to the Lenders.
81
10.4 Reliance on Communications.
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons and upon advice and statements of legal counsel (including, without
limitation, counsel to any of the Credit Parties, independent accountants and
other experts selected by the Administrative Agent with reasonable care). The
Administrative Agent may deem and treat each Lender as the owner of its
interests hereunder for all purposes unless a written notice of assignment,
negotiation or transfer thereof shall have been filed with the Administrative
Agent in accordance with Section 11.3(b). The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Credit
Agreement or under any of the other Credit Documents unless it shall first
receive such advice or concurrence of the Required Lenders (or, to the extent
provided in Section 11.6, all of the Lenders) as it deems appropriate or it
shall first be indemnified to its satisfaction by the Lenders against any and
all liability and expense (other than any liability or expense resulting from
the gross negligence or willful misconduct of the Administrative Agent) which
may be incurred by it by reason of taking or continuing to take any such action.
The Agent-Related Persons shall in all cases be fully protected in acting, or in
refraining from acting, hereunder or under any of the other Credit Documents in
accordance with a request of the Required Lenders (or to the extent specifically
provided in Section 11.6, all the Lenders) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders
(including their successors and assigns).
10.5 Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or a Credit Party
referring to the applicable Credit Document, describing such Default or Event of
Default and stating that such notice is a "notice of default." In the event that
the Administrative Agent receives such a notice, or otherwise becomes aware of a
Default or Event of Default, the Administrative Agent shall give prompt notice
thereof to the Lenders. The Administrative Agent shall take such action with
respect to such Default or Event of Default as shall be reasonably directed by
the Required Lenders (or, to the extent provided in Section 11.6, all of the
Lenders).
82
10.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that no Agent-Related Person has
made any representations or warranties to it and that no act by any
Agent-Related Person hereafter taken, including any review of the affairs of any
Credit Party, shall be deemed to constitute any representation or warranty by
any Agent-Related Person or any other Lender. Each Lender represents to the
Administrative Agent and the Arranger that it has, independently and without
reliance upon any Agent-Related Person or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own appraisal
of and investigation into the business, assets, operations, property, financial
and other conditions, prospects and creditworthiness of the Credit Parties and
made its own decision to make its Loans hereunder and enter into this Credit
Agreement. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person or any other Lender, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit analysis, appraisals and decisions in taking or not taking
action under this Credit Agreement, and to make such investigation as it deems
necessary to inform itself as to the business, assets, operations, property,
financial and other conditions, prospects and creditworthiness of the Credit
Parties. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent hereunder, no
Agent-Related Person shall have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, operations,
assets, property, financial or other conditions, prospects or creditworthiness
of the Credit Parties which may come into the possession of any Agent-Related
Person.
10.7 Indemnification.
The Lenders agree to indemnify each Agent-Related Person (to the extent
not reimbursed by the Credit Parties and without limiting the obligation of the
Credit Parties to do so), ratably according to their respective Commitments (or
if the Commitments have expired or been terminated, in accordance with the
respective principal amounts of outstanding Loans and Participation Interests of
the Lenders), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including without limitation at
any time following payment in full of the Obligations) be imposed on, incurred
by or asserted against such Agent-Related Person in any way relating to or
arising out of this Credit Agreement or the other Credit Documents or any
documents contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such
Agent-Related Person under or in connection with any of the foregoing; provided
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the gross negligence or willful
misconduct of such Agent-Related Person. If any indemnity furnished to the
Administrative Agent for any purpose shall, in the opinion of the Administrative
Agent, be insufficient or become impaired, the Administrative Agent may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity (except against its gross negligence or
willful misconduct) is furnished. The agreements in this Section 10.7 shall
survive the payment of the Obligations and all other amounts payable hereunder
and under the other Credit Documents.
83
10.8 Administrative Agent in Its Individual Capacity.
The Administrative Agent and its Affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Credit
Parties as though the Administrative Agent were not the Administrative Agent
hereunder. With respect to the Loans made and Letters of Credit issued and all
obligations owing to it, the Administrative Agent shall have the same rights and
powers under this Credit Agreement as any Lender and may exercise the same as
though it were not the Administrative Agent, and the terms "Lender" and
"Lenders" shall include the Administrative Agent in its individual capacity.
10.9 Successor Agent.
The Administrative Agent (a) may, at any time, resign upon 20 days
written notice to the Lenders or (b) may be removed, with the consent of the
Borrowers, for willful misconduct or gross negligence by written notice from the
Required Lenders; provided that no consent of the Borrowers shall be required
during the existence and continuation of an Event of Default. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint a
successor Administrative Agent. In the case of the Administrative Agent's
resignation, if no successor Administrative Agent shall have been so appointed
by the Required Lenders, and shall have accepted such appointment, within 45
days after the notice of resignation, then the retiring Administrative Agent
shall select a successor Administrative Agent provided such successor is a
Lender hereunder or an Eligible Assignee. If no such successor shall have been
appointed by the Administrative Agent, and shall have accepted such appointment,
within 45 days after such notice of resignation, such notice shall nevertheless
become effective and the Lenders shall perform all of the duties of the
Administrative Agent hereunder until such time, if any, as the Required Lenders
appoint a successor as provided above. Upon the acceptance of any appointment as
the Administrative Agent hereunder by a successor, if any, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Administrative
Agent, and the retiring or removed Administrative Agent shall be discharged from
its duties and obligations as the Administrative Agent, as appropriate, under
this Credit Agreement and the other Credit Documents and the provisions of this
Section 10.9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was the Administrative Agent under this Credit Agreement.
Citibank, N.A., as Syndication Agent hereunder, and Commerzbank AG New York and
Grand Cayman Branches and Fleet National Bank, each as a Co-Documentation Agent
hereunder, may each resign at any time without any requirement that a successor
syndication agent or co-documentation agent, respectively, be appointed in its
stead.
84
SECTION 11
MISCELLANEOUS
11.1 Notices.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device), (c)
the Business Day following the day on which the same has been delivered prepaid
or on an invoice arrangement to a reputable national overnight air courier
service, or (d) the third Business Day following the day on which the same is
sent by certified or registered mail, postage prepaid, in each case to the
respective parties at the address or telecopy numbers set forth on Schedule
11.1, or at such other address or numbers as such party may specify by written
notice to the other parties hereto.
11.2 Right of Set-Off.
In addition to any rights now or hereafter granted under applicable law
or otherwise, and not by way of limitation of any such rights, upon the
occurrence of an Event of Default and the commencement of remedies described in
Section 9.2, each Lender is authorized at any time and from time to time,
without presentment, demand, protest or other notice of any kind (all of which
rights being hereby expressly waived), to set off and to appropriate and apply
any and all deposits (general or special) and any other indebtedness at any time
held or owing by such Lender (including, without limitation, branches, agencies
or Affiliates of such Lender wherever located) to or for the credit or the
account of any Credit Party against obligations and liabilities of such Credit
Party to the Lenders hereunder, under the Notes, the other Credit Documents or
otherwise, irrespective of whether the Administrative Agent or the Lenders shall
have made any demand hereunder and although such obligations, liabilities or
claims, or any of them, may be contingent or unmatured, and any such set-off
shall be deemed to have been made immediately upon the occurrence of an Event of
Default even though such charge is made or entered on the books of such Lender
subsequent thereto. The Credit Parties hereby agree that any Person purchasing a
participation in the Loans and Commitments hereunder pursuant to Section 11.3(c)
or 3.8 may exercise all rights of set-off with respect to its participation
interest as fully as if such Person were a Lender hereunder.
85
11.3 Benefit of Agreement.
(a) Generally. This Credit Agreement shall be binding upon and
inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; provided that none of the Credit
Parties may assign and transfer any of its interests (except as
permitted by Sections 8.4 or 8.5) without the prior written consent of
the Lenders; and provided further that the rights of each Lender to
transfer, assign or grant participations in its rights and/or
obligations hereunder shall be limited as set forth in subsections (b)
and (c) of this Section 11.3. Notwithstanding the above (including
anything set forth in subsections (b) and (c) of this Section 11.3),
nothing herein shall restrict, prevent or prohibit any Lender from (A)
pledging or assigning a security interest in its rights hereunder or
under its Notes, if any, to secure obligations of such Lender,
including any pledge or assignment to a Federal Reserve Bank in support
of borrowings made by such Lender from such Federal Reserve Bank;
provided that no such pledge or assignment shall release a Lender from
any of its obligations hereunder or substitute any such pledgee or
assignee for such Lender as a party hereto, or (B) granting assignments
or participations in such Lender's Loans and/or Commitments hereunder
to its parent company and/or to any Affiliate of such Lender or to any
existing Lender or Affiliate thereof.
(b) Assignments. In addition to the assignments permitted by
Section 11.3(a), each Lender may, with the prior written consent of the
Borrowers and the Administrative Agent (provided that no consent of the
Borrowers shall be required during the existence and continuation of an
Event of Default), which consent shall not be unreasonably withheld or
delayed, assign all or a portion of its rights and obligations
hereunder pursuant to an assignment agreement substantially in the form
of Exhibit 11.3 to one or more Eligible Assignees; provided that (i)
any such assignment shall be in a minimum aggregate amount of
$5,000,000 of the Commitments and in integral multiples of $1,000,000
above such amount (or the remaining amount of Commitments held by such
Lender) and (ii) each such assignment shall be of a constant, not
varying, percentage of all of the assigning Lender's rights and
obligations under the Commitment being assigned. Any assignment
hereunder shall be effective upon satisfaction of the conditions set
forth above and delivery to the Administrative Agent of a duly executed
assignment agreement together with a transfer fee of $3,500 payable to
the Administrative Agent for its own account. Upon the effectiveness of
any such assignment, the assignee shall become a "Lender" for all
purposes of this Credit Agreement and the other Credit Documents and,
to the extent of such assignment, the assigning Lender shall be
relieved of its obligations hereunder to the extent of the Loans and
Commitment components being assigned. The Borrowers agree that upon
notice of any assignment to an assignee that was not theretofore a
Lender, they will promptly provide to such assignee a new Note. Each
Lender agrees that, in the event it assigns all of its Commitment
hereunder, it shall promptly return the Note or Note(s) executed by the
Borrowers in its favor.
86
By executing and delivering an assignment agreement in accordance with
this Section 11.3(b), the assigning Lender thereunder and the assignee
thereunder shall be deemed to confirm to and agree with each other and
the other parties hereto as follows: (i) such assigning Lender warrants
that it is the legal and beneficial owner of the interest being
assigned thereby free and clear of any adverse claim and the assignee
warrants that it is an Eligible Assignee; (ii) except as set forth in
clause (i) above, such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Credit
Agreement, any of the other Credit Documents or any other instrument or
document furnished pursuant hereto or thereto, or the execution,
legality, validity, enforceability, genuineness, sufficiency or value
of this Credit Agreement, any of the other Credit Documents or any
other instrument or document furnished pursuant hereto or thereto or
the financial condition of any Credit Party or the performance or
observance by any Credit Party of any of its obligations under this
Credit Agreement, any of the other Credit Documents or any other
instrument or document furnished pursuant hereto or thereto; (iii) such
assigning Lender and such assignee each represents and warrants that it
is legally authorized to enter into such assignment agreement; (iv)
such assignee confirms that it has received a copy of this Credit
Agreement, the other Credit Documents and such other documents and
information as it has deemed appropriate to make its own credit
analysis and decision to enter into such assignment agreement; (v) such
assignee will independently and without reliance upon the
Administrative Agent, such assigning Lender or any other Lender, and
based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not
taking action under this Credit Agreement and the other Credit
Documents; (vi) such assignee appoints and authorizes the
Administrative Agent to take such action on its behalf and to exercise
such powers under this Credit Agreement or any other Credit Document as
are delegated to the Administrative Agent by the terms hereof or
thereof, together with such powers as are reasonably incidental
thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all the obligations which by the terms of
this Credit Agreement and the other Credit Documents are required to be
performed by it as a Lender.
87
(c) Participations. Each Lender may, without the consent of,
or notice to, the Borrowers or the Administrative Agent, sell, transfer
or grant participations in all or any part of such Lender's interests
and obligations hereunder; provided that (i) such selling Lender shall
remain a "Lender" for all purposes under this Credit Agreement (such
selling Lender's obligations under the Credit Documents remaining
unchanged) and the participant shall not constitute a Lender hereunder,
(ii) no such participant shall have, or be granted, rights to approve
any amendment or waiver relating to this Credit Agreement or the other
Credit Documents except to the extent any such amendment or waiver
would (A) reduce the principal of or rate of interest on or fees in
respect of any Loans in which the participant is participating or
increase any Commitments with respect thereto, or (B) postpone the date
fixed for any payment of principal (including the extension of the
final maturity of any Loan or the date of any mandatory prepayment,
other than pursuant to Section 3.5), interest or fees in which the
participant is participating, (iii) sub-participations by the
participant (except to an Affiliate of the participant) shall be
prohibited and (iv) any such participations shall be in a minimum
aggregate amount of $5,000,000 of the Commitments and in integral
multiples of $1,000,000 in excess thereof. In the case of any such
participation, the participant shall not have any rights under this
Credit Agreement or the other Credit Documents (the participant's
rights against the selling Lender in respect of such participation to
be those set forth in the participation agreement with such Lender
creating such participation) and all amounts payable by the Credit
Parties hereunder shall be determined as if such Lender had not sold
such participation; provided, however, that such participant shall be
entitled to receive additional amounts under Sections 3.9, 3.12, 3.13
and 3.14 to the same extent that the Lender from which such participant
acquired its participation would be entitled to the benefit of such
cost protection provisions.
(d) The Administrative Agent shall maintain at the
Administrative Agent's office at the Agency Services Address a copy of
each assignment agreement delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amount of the Loans and LOC Obligations
owing to, each Lender pursuant to the terms hereof from time to time
(the "Register"). The entries in the Register shall be conclusive
absent manifest error, and the Borrowers, the Administrative Agent and
the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all
purposes of this Credit Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the
Borrowers and any Lender, at any reasonable time and from time to time
upon reasonable prior notice.
88
11.4 No Waiver; Remedies Cumulative.
No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Credit Parties and the
Administrative Agent or any Lender shall operate as a waiver thereof; nor shall
any single or partial exercise of any right, power or privilege hereunder or
under any other Credit Document preclude any other or further exercise thereof
or the exercise of any other right, power or privilege hereunder or thereunder.
The rights and remedies provided herein are cumulative and not exclusive of any
rights or remedies which the Administrative Agent or any Lender would otherwise
have. No notice to or demand on any Credit Party in any case shall entitle any
Credit Party to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Administrative Agent
or the Lenders to any other or further action in any circumstances without
notice or demand.
11.5 Payment of Expenses; Indemnification.
The Credit Parties agree to: (a) pay all reasonable out-of-pocket costs
and expenses of (i) each Agent-Related Person in connection with (A) the
negotiation, preparation, execution and delivery, syndication and administration
of this Credit Agreement and the other Credit Documents and the documents and
instruments referred to therein (including, without limitation, the reasonable
fees and expenses of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, special counsel to the Administrative
Agent) and (B) any amendment, waiver or consent relating hereto and thereto
including, but not limited to, any such amendments, waivers or consents
resulting from or related to any work-out, renegotiation or restructure relating
to the performance by the Credit Parties under this Credit Agreement, and (ii)
the Agent-Related Persons and the Lenders in connection with (A) enforcement of
the Credit Documents and the documents and instruments referred to herein and
therein, including, without limitation, in connection with any such enforcement,
the reasonable fees and disbursements of counsel for the Agent-Related Persons
and each of the Lenders, and (B) any bankruptcy or insolvency proceeding of a
Credit Party or any of its Subsidiaries, and (b) indemnify the Agent-Related
Persons, each Lender and its officers, directors, employees, representatives,
Affiliates and agents from and hold each of them harmless against any and all
losses, liabilities, claims, damages or expenses incurred by any of them as a
result of, or arising out of, or in any way related to, or by reason of, any
investigation, litigation or other proceeding (whether or not any Agent-Related
Person or any Lender is a party thereto) related to (i) the entering into and/or
performance of any Credit Document or the use of proceeds of any Extensions of
Credit or the consummation of any other transactions contemplated in any Credit
Document, including, without limitation, the reasonable fees and disbursements
of counsel incurred in connection with any such investigation, litigation or
other proceeding (but excluding any such losses, liabilities, claims, damages or
expenses to the extent incurred by reason of the gross negligence or willful
misconduct on the part of the Person to be indemnified), (ii) any Environmental
Claim and (iii) any claims for Non-Excluded Taxes.
89
11.6 Amendments, Waivers and Consents.
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing and signed by the Required Lenders and the Credit Parties; provided that
no such amendment, change, waiver, discharge or termination shall without the
written consent of each Lender affected thereby:
(a) extend the final maturity of any Loan or any portion
thereof or postpone any other date fixed for any payment of principal
(other than in accordance with Section 3.5(b)) or permit the expiration
date of any Letter of Credit to be after the Revolving Loan Maturity
Date;
(b) reduce the rate or extend the time of payment of interest
(other than as a result of waiving the applicability of any
post-default increase in interest rates) thereon or fees hereunder;
(c) reduce or waive the principal amount of any Loan;
(d) increase the Commitment of a Lender over the amount
thereof in effect (it being understood and agreed that a waiver of any
Default or Event of Default or a waiver of any mandatory reduction in
the Commitments shall not constitute a change in the terms of any
Commitment of any Lender);
(e) release either Borrower from its obligations, or all or
substantially all of the Guarantors from their obligations, under the
Credit Documents; provided that the Administrative Agent may release a
Guarantor if an equity interest in a Guarantor is transferred in
accordance with Section 8.5 or equity is issued in accordance with
Section 11.20;
(f) amend, modify or waive any provision of this Section 11.6
or Section 3.4(a), 3.4(b), 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14,
5.2, 9.1(a), 11.2, 11.3, 11.5 or 11.10;
(g) reduce any percentage specified in, or otherwise modify,
the definition of Required Lenders; or
(h) consent to the assignment or transfer by either Borrower
of any of its rights and obligations under (or in respect of) the
Credit Documents.
90
If any amendment, waiver or consent with respect to the Credit Documents has
been delivered in writing to a Lender by the Administrative Agent, and such
amendment, waiver or consent requires only the approval of the Required Lenders
to become effective, then such Lender shall have ten Business Days from the date
of receipt of such amendment, waiver or consent to respond thereto. Failure of a
Lender to timely respond to such amendment, waiver or consent shall be deemed an
approval by such Lender to such amendment, waiver or consent.
No provision of Section 2.2 may be amended or modified without the consent of
the Issuing Lender. No provision of Section 10 may be amended or modified
without the consent of the Administrative Agent.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any reorganization plan that affects the Loans or the
Letters of Credit, and each Lender acknowledges that the provisions of Section
1126(c) of the Bankruptcy Code supersedes the unanimous consent provisions set
forth herein and (y) the Required Lenders may consent to allow a Credit Party to
use cash collateral in the context of a bankruptcy or insolvency proceeding.
11.7 Counterparts/Telecopy.
This Credit Agreement may be executed in any number of counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument. Delivery of executed
counterparts by telecopy shall be as effective as an original and shall
constitute a representation that an original will be delivered.
11.8 Headings.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 Defaulting Lender.
Each Lender understands and agrees that if such Lender is a Defaulting
Lender then notwithstanding the provisions of Section 11.6 it shall not be
entitled to vote on any matter requiring the consent of the Required Lenders or
to object to any matter requiring the consent of all the Lenders; provided,
however, that all other benefits and obligations under the Credit Documents
shall apply to such Defaulting Lender.
11.10 Survival of Indemnification and Representations and Warranties.
All indemnities set forth herein and all representations and warranties
made herein shall survive the execution and delivery of this Credit Agreement,
the making of the Loans, the issuance of the Letters of Credit and the repayment
of the Loans and other Obligations and the termination of the Commitments
hereunder.
91
11.11 Governing Law; Jurisdiction.
(a) THIS CREDIT AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND
THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NORTH CAROLINA. Any legal action or proceeding
with respect to this Credit Agreement or any other Credit Document may
be brought in the courts of the State of North Carolina in Mecklenburg
County, or of the United States for the Western District of North
Carolina and, by execution and delivery of this Credit Agreement, each
Credit Party hereby irrevocably accepts for itself and in respect of
its property, generally and unconditionally, the jurisdiction of such
courts. Each Credit Party further irrevocably consents to the service
of process out of any of the aforementioned courts in any such action
or proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid, to it at the address for notices
pursuant to Section 11.1, such service to become effective 15 days
after such mailing. Nothing herein shall affect the right of a Lender
to serve process in any other manner permitted by law or to commence
legal proceedings or to otherwise proceed against a Credit Party in any
other jurisdiction. Each Credit Party agrees that a final judgment in
any action or proceeding shall be conclusive and may be enforced in
other jurisdictions by suit on the judgment or in any other manner
provided by law; provided that nothing in this Section 11.11(a) is
intended to impair a Credit Party's right under applicable law to
appeal or seek a stay of any judgment.
(b) Each Credit Party hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with
this Credit Agreement or any other Credit Document in the courts
referred to in subsection (a) hereof and hereby further irrevocably
waives and agrees not to plead or claim in any such court that any such
action or proceeding brought in any such court has been brought in an
inconvenient forum.
11.12 Waiver of Jury Trial.
EACH OF THE PARTIES TO THIS CREDIT AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT
OF OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR
THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY.
11.13 Time.
All references to time herein shall be references to Eastern Standard
Time or Eastern Daylight Time, as the case may be, unless specified otherwise.
11.14 Severability.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
11.15 Entirety.
This Credit Agreement together with the other Credit Documents
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
92
11.16 Binding Effect.
(a) This Credit Agreement shall become effective at such time
as all of the conditions set forth in Section 5.1 have been satisfied
or waived by the Lenders and it shall have been executed by the Credit
Parties and the Administrative Agent, and the Administrative Agent
shall have received copies hereof (telefaxed or otherwise) which, when
taken together, bear the signatures of each Lender, and thereafter this
Credit Agreement shall be binding upon and inure to the benefit of the
Credit Parties, the Administrative Agent and each Lender and their
respective successors and assigns. Upon this Credit Agreement becoming
effective, the Existing Credit Agreement shall be deemed terminated and
the Credit Parties and the lenders party to the Existing Credit
Agreement shall no longer have any obligations thereunder (other than
those obligations in the Existing Credit Agreement that expressly
survive the termination of the Existing Credit Agreement).
(b) This Credit Agreement shall be a continuing agreement and
shall remain in full force and effect until all Loans, LOC Obligations,
interest, fees and other Obligations have been paid in full and all
Commitments and Letters of Credit have been terminated. Upon
termination, the Credit Parties shall have no further obligations
(other than the indemnification provisions that survive) under the
Credit Documents; provided that should any payment, in whole or in
part, of the Obligations be rescinded or otherwise required to be
restored or returned by the Administrative Agent or any Lender, whether
as a result of any proceedings in bankruptcy or reorganization or
otherwise, then the Credit Documents shall automatically be reinstated
and all amounts required to be restored or returned and all costs and
expenses incurred by the Administrative Agent or any Lender in
connection therewith shall be deemed included as part of the
Obligations.
11.17 Confidentiality.
Each Lender agrees that it will use its reasonable best efforts to keep
confidential and to cause any representative designated under Section 7.11 to
keep confidential any non-public information from time to time supplied to it
under any Credit Document; provided, however, that nothing herein shall prevent
the disclosure of any such information to (a) the extent a Lender in good faith
believes such disclosure is required by Requirement of Law, (b) counsel for a
Lender or to its accountants, (c) bank examiners, auditors or comparable Persons
or any regulatory body having jurisdiction over a Lender, (d) any Affiliate of a
Lender, (e) any other Lender, or any assignee, transferee or participant, or any
potential assignee, transferee or participant, of all or any portion of any
Lender's rights under this Credit Agreement who is notified of the confidential
nature of the information, (f) any other Person in connection with any
litigation to which any one or more of the Lenders is a party or (g) any other
Person to whom disclosure of such information a Lender believes is necessary or
appropriate in its reasonable judgment; and provided further that no Lender
shall have any obligation under this Section 11.17 to the extent any such
information becomes available on a non-confidential basis from a source other
than a Credit Party or that any information becomes publicly available other
than by a breach of this Section 11.17.
93
11.18 Further Assurances.
The Credit Parties agree, upon the request of the Administrative Agent,
to promptly take such actions as are necessary to carry out the intent of this
Credit Agreement and the other Credit Documents.
11.19 Release of Guarantors.
If a Guarantor issues equity and as a result thereof such Guarantor is
no longer a Material Subsidiary, then, as long as after giving effect to the
issuance of such equity the Credit Parties will be in compliance with Section
7.2(i), the Lenders agree to release such Guarantor from its obligations
hereunder.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
94
Each of the parties hereto has caused a counterpart of this Third
Amended and Restated Credit Agreement to be duly executed and delivered as of
the date first above written.
BORROWERS: BRANDYWINE REALTY TRUST,
---------
a Maryland real estate investment trust
By:
------------------------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and Chief Executive Officer
BRANDYWINE OPERATING PARTNERSHIP,
L.P., a Delaware limited partnership
By: Brandywine Realty Trust, a Maryland
real estate investment trust, its
general partner
By:
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and Chief
Executive Officer
95
GUARANTORS:
96
LENDERS:
BANK OF AMERICA, N.A., acting in its
capacity as Administrative Agent and
individually as a Lender
By:
------------------------------------
Name:
------------------------------------
Title:
------------------------------------
97