SECOND AMENDED AND RESTATED
REVOLVING LINE OF CREDIT AND SECURITY AGREEMENT
AMONG
COMMERCIAL NET LEASE REALTY, INC.,
NET LEASE REALTY I, INC.,
NET LEASE REALTY II, INC.,
THE LENDERS LISTED ON THE SIGNATURE PAGES HEREOF,
and
FIRST UNION NATIONAL BANK OF FLORIDA,
as the Agent
TABLE OF CONTENTS
SECTION 1. DEFINITIONS 2
1.1 Defined Terms. 2
1.2 Other Definitional Provisions 10
SECTION 2. THE CREDIT 10
2.1 The Revolving Credit Facility 10
2.2 Advance Requests and Funding Mechanics 11
2.3 Letters of Credit 14
2.4 Use of Proceeds 16
2.5 Note 16
2.6 Interest 16
2.7 Repayment 17
2.8 Fees 18
2.9 Extension of Revolving Credit Maturity Date 18
2.10 Single Loan 18
2.11 Payments and Computations 19
2.12 Prepayments 20
2.13 LIBOR Rate Compensation 21
2.14 Sharing of Payments, Etc. 22
2.15 Conversion and Continuation of Advances; Failure to Select
Interest Period 23
2.16 Increased Costs, Illegality, Etc. 24
2.17 Letters of Credit Obligations 25
SECTION 3. SECURITY DOCUMENTS 27
3.1 Security Agreement 27
3.2 Ownership and Encumbrance of Property 28
3.3 Additional Security Documents 28
3.4 Release of Property 29
SECTION 4. REPRESENTATIONS AND WARRANTIES 30
4.1 Corporate Existence of Borrower; Compliance with Law 31
4.2 Authorization 31
4.3 Enforceable Obligations 31
4.4 Financial Condition of the Borrowers 31
4.5 No Litigation 32
4.6 Disclosure and No Untrue Statements 32
4.7 Title to Assets; Leases in Good Standing 32
4.8 Payment of Taxes 32
4.9 Agreement or Contract Restrictions 33
4.10 Patents, Trademarks, Etc. 33
4.11 Racketeer Influenced and Corrupt Organization(s) Act 33
4.12 Investment Company Act; Regulation 33
4.13 Labor Matters 34
4.14 ERISA Requirement 34
4.15 Compliance With Environmental Requirements 34
4.16 Compliance with REIT Requirements 35
4.17 Principal Office/Corporate Name 35
4.18 Use of Credit 35
SECTION 5. CONDITIONS OF LENDING 36
5.1 Request for Borrowing; Security Documents and Information 36
5.2 Continuing Accuracy of Representations and Warranties 36
5.3 No Default 36
5.4 Loan Documents 36
5.5 Supporting Documents 36
5.6 Opinion of the Borrowers' Counsel 37
SECTION 6. AFFIRMATIVE COVENANTS 38
6.1 Financial Reports and Other Data 38
6.2 Financial Covenants of the Borrowers 40
6.3 Payment and Performance of the Borrowers Obligations 40
6.4 Depository Account 40
6.5 Conduct of Business; Maintenance of Existence 40
6.6 Right of Inspection; Discussions 40
6.7 Notices 41
6.8 Payment of Taxes; Liens 42
6.9 Maintenance of Property, Leases 42
6.10 ERISA Benefit Plans 42
6.11 Insurance of Property 43
6.12 True Books 43
6.13 Observance of Laws 43
6.14 Further Assurances 43
6.15 Change of Name, Principal Place of Business, Office, or the
Agent 44
6.16 Status 44
6.17 Syndication of Credit 44
6.18 Use of Proceeds from Mortgage Loans 44
SECTION 7. NEGATIVE COVENANTS 44
7.1 Other Indebtedness 44
7.2 Limitations on Mortgages, Liens, Etc. 45
7.3 No Guaranties 45
7.4 Merger, Sale of Assets, Dissolution, Etc. 45
7.5 Limitations on Loans, Advances, and Investments 46
7.6 Regulation U 46
7.7 Insider Transactions 46
7.8 Changes in Governing Documents, Accounting Methods, Fiscal Year 47
7.9 Management 47
SECTION 8. EVENTS OF DEFAULT 47
8.1 Payment of Obligations to the Banks 47
8.2 Representation or Warranty 47
8.3 Covenants 47
8.4 Any Borrower's Liquidation; Dissolution; Bankruptcy; Etc. 47
8.5 Order of Dissolution 48
8.6 Reports and Certificates 48
8.7 Judgments 48
8.8 Liens Imposed by Law 48
8.9 Corporate Existence 48
8.10 Invalidity of Security Interest and Liens 48
SECTION 9. THE AGENT 49
9.1 Appointment, Authorization, and Action 49
9.2 Delegation of Duties 50
9.3 Exculpatory Provisions 50
9.4 Reliance by the Agent 51
9.5 Agent and Affiliates 51
9.6 Notice of Default 51
9.7 Non-Reliance on the Agent and Other Lenders 52
9.8 Enforcement by the Agent 52
9.9 Indemnification 52
9.10 Failure to Act 53
9.11 Successor Agent 53
SECTION 10. INDEMNIFICATION BY BORROWERS 53
SECTION 11. MISCELLANEOUS 54
11.1 Course of Dealing; Amendments 54
11.2 Payment of Expenses, Including Attorneys' Fees and Taxes 54
11.3 Successors and Assigns 55
11.4 Assignments and Participations 55
11.5 Confidential Information 57
11.6 Liens; Set-Off 58
11.7 Notices 59
11.8 Waiver of Default 59
11.9 No Waiver; Cumulative Remedies 59
11.10 Venue and Jurisdiction 59
11.11 Governing Law 60
11.12 Title and Headings; Table of Contents 60
11.13 Complete Agreement 60
11.14 Legal or Governmental Limitations 60
11.15 Counterparts 60
11.16 Additional Banks 60
11.17 WAIVER OF JURY TRIAL BY BORROWERS 62
SECOND AMENDED AND RESTATED
REVOLVING LINE OF CREDIT AND SECURITY AGREEMENT
-----------------------------------------------
THIS SECOND AMENDED AND RESTATED REVOLVING LINE OF CREDIT AND SECURITY
AGREEMENT is made and entered into as of this _____ day of December, 1995, by
and among COMMERCIAL NET LEASE REALTY, INC., a Maryland corporation ("CNLR"),
NET LEASE REALTY I, INC., a Maryland corporation ("Net I") and NET LEASE REALTY
II, INC., a Maryland corporation ("Net II") (CNL, Net I and Net II are
hereinafter sometimes individually referred to as a "Borrower" and collectively
referred to as the "Borrowers"), FIRST UNION NATIONAL BANK OF FLORIDA, a
national banking association, as the Agent (the "Agent") and the financial
institutions which are, or may from time to time become, listed on the signature
pages hereof (together with their successors and assigns, individually a "Bank"
and collectively the "Banks").
BACKGROUND
----------
CNLR and First Union National Bank of Florida entered into a Revolving
Line of Credit and Security Agreement dated as of June 21, 1994 (the "Prior
Credit Agreement"), which provided for a revolving line of credit in the amount
of $30,000,000.00 in favor of CNLR (the "Prior Credit"), evidenced by a
promissory note in the principal amount of $30,000,000.00 (the "Prior Note"),
Collateral Assignments of Leases, Rents, and Profits and Security Agreements,
Agreements Not to Encumber or Transfer Property, and other related instruments
(the "Prior Security Documents").
Subsequently, CNLR, the Agent and certain Banks entered into a Revolving
Line of Credit and Security Agreement dated as of July 25, 1994 (the "1994
Credit Agreement"), which provided for a revolving line of credit in the amount
of $100,000,000.00 in favor of CNLR (the "Existing Credit") pursuant to which
First Union National Bank of Florida assigned the Prior Credit (including but
not limited to the Prior Note and the Prior Security Documents) to the Banks and
evidenced by a Promissory Note in the principal amount of $100,000,000.00 (the
"Existing Note"), Collateral Assignments of Leases, Rents and Profits and
Security Agreements, Agreements Not to Encumber or Transfer Property, and other
related instruments (the "Existing Security Documents"). The 1994 Credit
Agreement superseded and replaced the Prior Credit Agreement and provided for an
increased line of credit.
CNLR, the Agent and the Banks subsequently agreed to amend and restate the
1994 Credit Agreement to reflect certain changes in the terms of the Credit
pursuant to the terms of an Amended and Restated Revolving Line of Credit and
Security Agreement dated as of April 13, 1995 (the "Existing Agreement") which
superseded the 1994 Credit Agreement.
CNLR has now requested certain additional amendments to the Existing
Agreement to permit (i) CNLR to incur mortgage loans from Principal Mutual Life
Insurance Company, or an affiliate thereof, in the total amount of not more than
$52,600,000.00 with respect to certain properties currently identified in the
Existing Security Documents and (ii) to allow it to place certain properties to
be acquired in its wholly-owned subsidiaries, Net I and Net II.
The Agent and the Banks have agreed to CNLR's request so long as: (i) all
proceeds from Principal Mutual Life Insurance Company's, or an affiliate
thereof, mortgage loans to CNLR are used to prepay outstanding Advances under
the Credit, as hereinafter defined and (ii) Net I and Net II agree to become co-
borrowers under the Credit, and pursuant to the terms and conditions of this
Agreement which supersedes the Existing Agreement and is evidenced by a Renewal
and Modification Promissory Note in the principal amount of $100,000,000.00 and
the Existing Security Documents.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements, covenants, and conditions herein, the Existing Agreement is hereby
amended and restated and the Borrowers, the Agent, and the Banks agree as
follows:
SECTION I. DEFINITIONS
1.1 DEFINED TERMS. Except as otherwise expressly provided in this
Agreement, the following capitalized terms shall have the respective meanings
ascribed to them for all purposes of this Agreement:
"Advance" means a Revolving Credit Advance.
"Agent" means First Union National Bank of Florida, acting as agent for
the Banks hereunder, together with any successor agent appointed pursuant to the
provisions hereof.
"Agreement" means this Second Amended and Restated Revolving Line of
Credit and Security Agreement (which supersedes the Existing Agreement), as the
same may be amended, supplemented, restated, replaced, or otherwise modified
from time to time.
"Banks" means First Union National Bank of Florida, SouthTrust Bank of
Alabama National Association, Creditanstalt Corporate Finance, Inc., Comerica
Bank, AmSouth Bank of Florida, and the other lending institutions which are, or
from time to time may become, signatories hereto, and any other lending
institution which becomes an assignee or successor of any rights of a Bank
pursuant to Subsection 11.4 hereof.
"Borrower" means Commercial Net Lease Realty, Inc., a Maryland
corporation, and its successors, Net Lease Realty I, Inc., a Maryland
corporation, and its successors, or Net Lease Realty II, Inc., a Maryland
corporation, and its successors.
"Borrowers" means Commercial Net Lease Realty, Inc., a Maryland
corporation, and its successors, Net Lease Realty I, Inc., a Maryland
corporation, and its successors, and Net Lease Realty II, Inc., a Maryland
corporation, and its successors.
"Business Day" means a day that is not a Saturday, a Sunday, or a day on
which either the Agent or First Union National Bank of North Carolina is closed
pursuant to authorization or requirement of law.
"Capital" means Funded Debt plus Tangible Net Worth.
"Cash Flow Coverage Ratio" means Funds from Operations plus Interest
divided by Interest.
"Closing Date" means the date this Agreement is executed by the Borrowers,
the Agent and the Banks.
"CNLR" means Commercial Net Lease Realty, Inc., a Maryland corporation,
and its successors.
"Collateral" means all leases, rents, income, profits, and accounts
receivable arising from any and every lease, rental, or occupancy agreement
entered into with respect to property now owned or hereafter acquired by
Borrowers, except as otherwise provided in this Agreement.
"Consistent Basis" means, in reference to the application of Generally
Accepted Accounting Principles, that the accounting principles observed in the
current period are comparable in all material respects to those applied in the
preceding period.
"Continue," "Continuation," and "Continued" refer to a continuation of
Advances of the same Type from one Interest Period to the next Interest Period.
"Convert," "Conversion," and "Converted" refer to a conversion of Advances
of one Type into Advances of the other Type pursuant to Subsection 2.15 or 2.16
hereof.
"Credit" means the Revolving Credit Facility described in Section 2 below.
"Debt Service" shall mean amortization of existing term debt of the
Borrowers plus assumed fifteen year amortization of debt under the Credit, plus
existing property capital expenditures.
"Debt Service Coverage Ratio" means Funds from Operations plus existing
property capital expenditures, divided by Debt Service.
"Default Rate" has the meaning specified in Subsection 2.6(c)(iii) hereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as the
same may be supplemented or amended from time to time.
"Event of Default" means any of the events specified in Section 8 hereof.
"Existing Credit" has the meaning specified in the Background section
hereof.
"Existing Credit Agreement" has the meaning specified in the Background
section hereof.
"Existing Note" has the meaning specified in the Background section
hereof.
"Existing Security Documents" has the meaning specified in the Background
section hereof.
"Federal Funds Rate" means, for any period, a fluctuating interest rate
per annum equal for each day during such period to the weighted average of the
rates per annum, rounded upward to the nearest one-hundredth of one percent
(1/100%), on overnight federal funds transactions with members of the Federal
Reserve System, arranged by federal funds brokers, as published for such day (or
if such day is not a Business Day, for the next preceding Business Day) by the
Board of Governors of the Federal Reserve System in Publication H.15 (519), or,
if such rate is not published for any day which is a Business Day, the average
of the quotations for such day for such transactions received by the Agent from
three (3) federal funds brokers of recognized standing selected by the Agent.
"Funded Debt" shall mean all interest bearing debt of Borrowers plus the
maximum amounts of any outstanding letters of credit issued for the benefit of
any Borrower.
"Funds from Operations" shall mean net income plus depreciation and
amortization plus capital lease payments less accrued rental income less earned
income from direct financing leases in accordance with Generally Accepted
Accounting Principles applied on a Consistent Basis.
"Generally Accepted Accounting Principles" means those principles of
accounting set forth in Opinions of the Financial Accounting Standards Board of
the American Institute of Certified Public Accountants or which have other
substantial authoritative support and are applicable in the circumstances as of
the date of any report required herein or as of the date of an application of
such principles as required herein.
"Governmental Acts" shall have the meaning specified in Section 2.17(b)
hereof.
"Governmental Authority" shall mean, as to any Person, any government (or
any political subdivision or jurisdiction thereof), court, bureau, agency or
other governmental authority having jurisdiction over such Person or any of its
business, operations or properties.
"Interest" means with respect to any period the net interest expense of
the Borrowers for such period, as determined in accordance with Generally
Accepted Accounting Principles applied on a Consistent Basis.
"Interest Period" means, for each LIBOR Rate Advance comprising part of
the same borrowing, the period commencing on the date such Advance is made,
Converted from an Advance of another Type, or Continued as an Advance of the
same Type, and ending on the numerically corresponding day one, two, three, or
six months thereafter as the Borrowers may select, as provided in Subsections
2.2 or 2.15 hereof; provided however that:
(a) Interest Periods commencing on the same date for LIBOR Rate
Advances shall be of the same duration;
(b) If an Interest Period would otherwise expire on a day that is
not a Business Day, such Interest Period shall expire on the next succeeding
Business Day; provided that if any Interest Period would otherwise expire on a
day that is not a Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall expire on the next
preceding Business Day;
(c) Any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
(d) No Interest Period shall extend beyond the Revolving Credit
Maturity Date.
"Issuing Bank" means First Union National Bank of Florida, in its capacity
as a Bank hereunder, for so long as it remains the Agent hereunder. Upon the
appointment of a successor Agent, the "Issuing Bank" shall be the successor
Agent, in its capacity as a Bank hereunder, for the purposes of all new Letters
of Credit issued hereunder.
"Late Fee" has the meaning specified in Subsection 2.7(c) hereof.
"Letters of Credit" has the meaning specified in Subsection 2.3 hereof.
"Letter of Credit Contingent Obligation" and "Letters of Credit Contingent
Obligations" mean the amount available for drawings and remaining undrawn under
the Letter of Credit or Letters of Credit, respectively.
"LIBOR Rate Advance" means an Advance that bears interest at a rate
determined by reference to the Reserve Adjusted LIBOR Rate, as provided in
Subsection 2.6(a)(ii) hereof.
"LIBOR Reserve Requirement" means, for any day, the rate at which reserves
(including, without limitation, any marginal, supplemental, or emergency
reserves) are required to be maintained by member banks of the Federal Reserve
System on such day against Eurocurrency liabilities, expressed as a decimal.
"Loan Documents" means the following documents:
(a) This Second Amended and Restated Revolving Line of
Credit and Security Agreement;
(b) The Renewal and Modification Promissory Note made by the
Borrowers in favor of the Agent for the benefit of the Banks in the
amount of $100,000,000.00;
(c) Assignments of Leases, Rents and Profits made by any
Borrower to the Agent for the benefit of the Banks with respect to
property now owned or hereafter acquired by any Borrower or any
leasehold interest in property hereafter acquired by any Borrower,
except as otherwise provided for in this Agreement;
(d) Agreements Not To Encumber or Transfer Property made by
any Borrower to the Agent for the benefit of the Banks with respect
to property now owned or hereafter acquired by any Borrower or any
leasehold interest in property hereafter acquired by any Borrower,
except as otherwise provided for in this Agreement;
(e) Agreements between the Agent on behalf of the Banks, a
Borrower and the landlord with respect to any leasehold interest
hereinafter acquired by any Borrower, except as otherwise provided
for in this Agreement;
(f) Anti-Coercion Statements with respect to property now
owned or hereafter acquired by any Borrower;
(g) UCC-1 Financing Statements covering all leases, rents,
income, profits, and accounts receivable arising from any and every
lease, rental, or occupancy agreement entered into with respect to
property now owned by or hereafter acquired by any Borrower, except
as otherwise provided for in this Agreement, and such other
documents as will ensure the Agent, as Agent for the benefit of the
Banks, a first perfected security interest in and to such personal
property; and
(h) all other documents executed and delivered by any
Borrower in connection with the Credit closing, and thereafter from
time to time as contemplated by this Agreement, including any
modifications, amendments, or restatements of the foregoing.
"Net I" means Net Lease Realty I, Inc., a Maryland corporation, and its
successors.
"Net II" means Net Lease Realty II, Inc., a Maryland corporation, and its
successors.
"1994 Credit Agreement" has the meaning specified in the Background
section hereof.
"Note" means the Renewal and Modification Promissory Note (which
supersedes the Existing Note), as may be amended, renewed, increased, restated,
or replaced from time to time.
"Notice of Borrowing" means a Notice of Borrowing in the form attached
hereto as Exhibit "B".
"Person" means any natural person, corporation, unincorporated
organization, trust, joint venture, association, company, partnership, or
government, or any agency or political subdivision of any government.
"Prime Rate" means, for the purposes hereof, the rate of interest
announced by the Agent from time to time as its Prime Rate. The Agents' Prime
Rate is a reference rate used by the Agent in determining interest rates on
certain loans. The Agent loans at rates both above and below the Agent's Prime
Rate, and the Borrowers acknowledge that the Agent's Prime Rate is not
represented or intended to be the lowest or most favorable rate of interest
offered by the Agent.
"Prime Rate Advance" means an Advance that bears interest at a rate
determined with reference to the Prime Rate, as provided in Subsection 2.6(a)(i)
hereof.
"Prior Credit" has the meaning specified in the Background section hereof.
"Prior Credit Agreement" has the meaning specified in the Background
section hereof.
"Prior Note" has the meaning specified in the Background section hereof.
"Prior Security Documents" has the meaning specified in the Background
section hereof.
"Pro Rata Portion" means, with respect to any Bank, the quotient obtained
by dividing the Revolving Credit Commitment of the Bank by the aggregate
Revolving Credit Commitments of all the Banks.
"Qualified REIT Subsidiary Status" means Net I's and Net II's status as a
qualified REIT subsidiary as defined in Section 856(i) of the Internal Revenue
Code, as amended.
"REIT Status" means each Borrower's status as a real estate investment
trust as defined in Section 856(a) of the Internal Revenue Code, as amended.
"Related Entities" means any "affiliated person" as defined under the
provisions of the United States Internal Revenue Code.
"Required Banks" means at any time the Banks owning or holding in the
aggregate at least 66 2/3% of the aggregate unpaid principal amount of the
Advances or, in the event that no Advances are outstanding, the Banks having at
least 66 2/3% of the aggregate Revolving Credit Commitments.
"Reserve Adjusted LIBOR Rate" means, for any Interest Period, an interest
rate per annum obtained by dividing (i) the rate quoted on the Telerate page
3750 as of 11:00 a.m. London time, on the day that is two London banking days
prior to the first day of the Interest Period, in an amount substantially equal
to the LIBOR Rate Advance and with a term substantially equal to such Interest
Period, by (ii) an amount equal to 1 minus the LIBOR Reserve Requirement for
such Interest Period. In the event the rate quoted by Telerate is discontinued
or the rate otherwise cannot be identified, the Agent shall determine the LIBOR
Rate on the basis of quotes by major banks in the London interbank Eurodollar
market for dollar deposits in an amount substantially equal to the LIBOR Rate
Advance for a term substantially equal to the Interest Period selected.
"Revolving Credit Advance" has the meaning specified in Subsection 2.1(a)
hereof.
"Revolving Credit Commitment" means $35,000,000 in the case of First Union
National Bank of Florida, $20,000,000 in the case of SouthTrust Bank of Alabama
National Association, $20,000,000 in the case of Creditanstalt Corporate
Finance, Inc., $20,000,000 in the case of Comerica Bank, $5,000,000 in the case
of AmSouth Bank of Florida, and in the case of any other Bank, that amount set
forth next to the name of the Bank on the signature pages hereto or, if there
has been a full or partial assignment of a Revolving Credit Commitment pursuant
to the provisions of Subsection 11.4 hereof, as may be reflected on the records
of the Agent with respect to such assignment.
"Revolving Credit Facility" means the commitments of the Banks to make
Revolving Credit Advances to and issue Letters of Credit in favor of the
Borrowers pursuant to Subsection 2.1 hereof.
"Revolving Credit Maturity Date" shall mean June 30, 1997 (as such date
may be extended pursuant to the provisions hereof) or if such date is not a
Business Day, the next succeeding Business Day, or such earlier date on which
the Credit shall be due and payable pursuant to the terms hereof.
"Revolving Credit Note" has the meaning specified in Subsection 2.5
hereof.
"Security Documents" has the meaning specified in Subsection 3.3 hereof.
"Tangible Net Worth" means an amount equal to the total assets of the
Borrowers minus the Total Intangible Assets of the Borrowers, minus the total
liabilities of the Borrowers, calculated in accordance with Generally Accepted
Accounting Principles applied on a Consistent Basis.
"Term Credit" shall have the meaning specified in Subsection 7.1 hereof.
"Total Intangible Assets" of the Borrowers shall be determined in
accordance with Generally Accepted Accounting Principles applied on a Consistent
Basis, but in any event shall be deemed to include the excess of costs over the
assets of acquired businesses, formulae, trademarks, patents, patent rights, and
deferred expenses (including, but not limited to, unamortized debt discount and
expense, organization expense, experimental and developmental expenses, but
excluding prepaid expenses).
"Total Liabilities" means the total liabilities of the Borrower
(including, without limitation, all obligations or indebtedness of any other
Person which the Borrower has assumed, guaranteed, or endorsed or in connection
with which the Borrower has otherwise become directly or contingently liable and
the amount of any outstanding Letters of Credit) computed in accordance with
Generally Accepted Accounting Principles applied on a Consistent Basis.
"Type" refers to the distinction among Advances bearing interest based on
the Prime Rate and the Reserve Adjusted LIBOR Rate.
1.2 OTHER DEFINITIONAL PROVISIONS.
(a) The terms "material" and "materially" shall have the meanings
ascribed to such terms under Generally Accepted Accounting Principles as
such would be applied to the business of the Borrowers, except as the
context shall clearly otherwise require;
(b) all of the terms defined in this Agreement shall have such
defined meanings when used in other documents issued under, or delivered
pursuant to, this Agreement unless the context shall otherwise require;
(c) all terms defined in this Agreement in the singular shall have
comparable meanings when used in the plural, and vice versa;
(d) accounting terms to the extent not otherwise defined shall
have the respective meanings given them under, and shall be construed in
accordance with, Generally Accepted Accounting Principles;
(e) terms defined in, or by reference to, Article 9 of the Uniform
Commercial Code as adopted in Florida to the extent not otherwise defined
herein shall have the respective meanings given to them in Article 9 with
the exception of the word "document" unless the context clearly requires
such meaning;
(f) the words "hereby," "hereto," "hereof," "herein," "hereunder,"
and words of similar import when used in this Agreement shall refer to
this Agreement as a whole and not to any particular provision of this
Agreement;
(g) the masculine and neuter genders are used herein and whenever
used shall include the masculine, feminine, and neuter as well; and
(h) wherever in this Agreement any of the parties hereto is
referred to, such reference shall be deemed to include the successors and
assigns of such parties unless the context shall expressly provide
otherwise.
SECTION 2. THE CREDIT
2.1 THE REVOLVING CREDIT FACILITY.
(a) Each Bank severally agrees, on the terms and conditions set forth
herein, that prior to the Revolving Credit Maturity Date and so long as there
exists no Event of Default or circumstance which with the giving of notice or
passage of time would become an Event of Default, it will make advances to the
Borrowers (all such advances and the Bank's Pro Rata Portion of any unreimbursed
amounts paid under Letters of Credit referred to herein as "Revolving Credit
Advances" and "Advances") in an aggregate amount which, when aggregated with
Advances comprised of the Bank's Pro Rata Portion of unreimbursed amounts paid
under Letters of Credit and with the Bank's Pro Rata Portion of Letter of Credit
Contingent Obligations, does not exceed at any time such Bank's Revolving Credit
Commitment, subject to the terms and conditions of this Agreement. During the
aforesaid period, the Borrowers may borrow, repay, and reborrow, and request the
issuance of Letters of Credit in accordance with the terms hereof. The
Borrowers acknowledge that the amount outstanding at any time pursuant to the
Credit is as reflected in the books and records of the Agent and shall be
conclusive and binding absent manifest error. Agent will, upon request, furnish
the Borrowers with a statement of the amount outstanding pursuant to the Credit
as reflected in the books and records of the Agent at the time of any such
request.
(b) If at any time the principal amounts outstanding under any
Bank's Revolving Credit Advances (including Advances in respect of unreimbursed
amounts paid under Letters of Credit), together with the aggregate amount of the
Bank's Pro Rata Portion of the Letter of Credit Contingent Obligations, exceed
such Bank's Revolving Credit Commitment, the Borrowers shall prepay the Bank's
Revolving Credit Advances so as to cause the aggregate outstanding amounts
thereunder to be equal to or less than such Bank's Revolving Credit Commitment.
(c) Subject to the further terms and limitations of this
Agreement, the Borrowers may designate Advances requested under the Revolving
Credit Facility and Advances made pursuant to draws under Letters of Credit
issued under the Revolving Credit Facility to be LIBOR Rate Advances or Prime
Rate Advances, and the Borrowers may Convert Advances of one Type into Advances
of another Type (as provided in Subsection 2.15 hereof), or Continue Advances of
one Type as Advances of the same Type (as provided in Subsection 2.15 hereof).
All Advances shall be made, Converted, or Continued by the Banks simultaneously
and proportionately to their Pro Rata Portion of the aggregate Commitments.
(d) On the Closing Date, the aggregate outstanding principal
amount under the Existing Agreement shall be automatically converted to an
equivalent principal amount of Revolving Credit Advances hereunder (which shall
be Prime Rate Advances unless otherwise specified by the Borrowers in accordance
with the procedures contained in Subsection 2.15 hereof), allocated to the then
existing Banks pro rata in accordance with their Pro Rata Portions, and shall be
deemed to be Revolving Credit Advances and Advances and included in the Banks'
Revolving Credit Commitments for all purposes hereof.
2.2 ADVANCE REQUESTS AND FUNDING MECHANICS.
(a) The Revolving Credit Advances (other than Advances made by
honoring a draft drawn under a Letter of Credit) shall be made upon irrevocable
notice from the Borrowers to the Agent (effective upon receipt) no later than
10:00 a.m. (Eastern Time) three (3) Business Days prior to the date of any
proposed LIBOR Rate Advances and no later than 10:00 a.m. (Eastern Time) one (1)
Business Day prior to the date of any proposed Prime Rate Advances. Each such
notice shall be in writing, or shall be by telephone or telecopier, confirmed
immediately in writing, specifying the proposed (i) date of borrowing, (ii)
aggregate amount of borrowing, (iii) Type of Advances, (iv) in the case of LIBOR
Rate Advances, the initial Interest Period for such Advances, and (v) manner of
receipt of the funds, and shall be evidenced by an executed Notice of Borrowing.
Each request for such Advances shall be in the aggregate minimum amount of
$100,000.00 or an integral multiple thereof, except that with respect to LIBOR
Rate Advances, each request shall be in the aggregate minimum amount of
$1,000,000.00 and in integral multiples of $100,000.00.
(b) Notwithstanding the foregoing, the Borrowers may not select
any LIBOR Rate Advances if (i) the obligation of any of the Banks to make LIBOR
Rate Advances is suspended pursuant to Subsections 2.15(b)(iii) or 2.16(c) or
(d) hereof, or (ii) after giving effect to the Advances, the aggregate number of
different Interest Periods for outstanding LIBOR Rate Advances from the Banks is
greater than ten (10) (for purposes of this clause, Interest Periods of the same
duration, but commencing on different dates, shall be treated as different
Interest Periods).
(c) Neither the Agent nor any Bank shall incur any liability to
the Borrowers in acting upon any telephonic notice referred to herein that the
Agent believes in good faith to have been given by a duly authorized officer or
other person authorized to borrow on behalf of the Borrowers or for otherwise
acting in good faith under this Subsection, and, upon funding of Advances by the
Bank in accordance with this Agreement pursuant to any telephonic notice, the
Borrowers shall be deemed to have received Advances hereunder.
(d) Each notice of a proposed borrowing shall be irrevocable and
binding on the Borrowers. In the case of LIBOR Rate Advances, the Borrowers
shall indemnify each Bank against any loss, costs, or expense incurred by such
Bank as a result of any failure of the Borrowers to fulfill on or before the
date specified for such Advance all conditions for such borrowing set forth in
Section 5 hereof, or as a result of any purported revocation of such Advance
request or any other reason for nonfunding of such Advance, including, without
limitation, any loss (including loss of anticipated profits), cost, or expense
incurred by reason of the liquidation or reemployment of deposits or other funds
acquired by the Bank to fund the Advance, when such Advance is not made on such
date, as more fully described in Subsection 2.13 hereof.
(e) The Agent shall give each Bank notice of each request for
Advances in writing or by telephone or telecopier not later than 12:00 p.m.
(Eastern Time) on the date of receipt of such request, provided that if the
request was not received prior to 10:00 a.m. (Eastern Time), the Agent shall
give such notice no later than 9:00 a.m. (Eastern Time) on the following
Business Day. Not later than 2:00 p.m. (Eastern Time) on the date specified in
such notice, each Bank shall make available to the Agent, at its Lending Office
specified on the signature pages hereof, in immediately available funds, the
Bank's Pro Rata Portion of such borrowing. After the Agent's receipt of such
funds, the Agent will make such funds available to the Borrowers at the Agent's
office referred to above no later than 2:00 p.m. (Eastern Time) on the date
specified in the notice.
(f) Unless the Agent shall have received notice from a Bank prior
to the date of any proposed borrowing that such Bank will not make available to
the Agent such Bank's Pro Rata Portion of the borrowing, the Agent may assume
that the Bank has made such portion available to the Agent on the date of such
borrowing in accordance with the provisions hereof. The Agent may, in reliance
upon such assumption (but shall not be required to), make available to the
Borrowers a corresponding amount. If and to the extent that the Bank shall not
have so made such Pro Rata Portion available to the Agent, the Bank and the
Borrowers severally agree to repay to the Agent forthwith upon demand, to the
extent not collected from the other, such corresponding amount together with
interest thereon, for each day from the date such amount is made available to
the Borrowers until the date such amount is repaid to the Agent at (i) in the
case of the Borrowers, the interest rate applicable at the time to the Advances
comprising the borrowing, and (ii) in the case of the Bank, the Federal Funds
Rate; provided, however, that the Borrowers shall not be required to so repay
such amount if and to the extent that the Agent, in its capacity as a Bank, has
availability therefor under its Revolving Credit Commitment. In such
circumstances, the Agent, in its capacity as a Bank, may, but shall not be
required to, make an Advance under its Revolving Credit Commitment in respect of
such amount. If the delinquent Bank shall repay to the Agent (in its capacity
as Agent or Bank, as appropriate) such amount (with interest), the amount so
repaid shall constitute the Bank's Advance as part of such borrowing for
purposes of this Agreement. If the Borrowers shall repay to the Agent such
corresponding amount, or if the Agent, in its capacity as a Bank, makes an
Advance therefor, such payment or Advance shall not relieve the delinquent Bank
of its obligations hereunder.
(g) The failure of any Bank to make an Advance to be made by it as
part of any borrowing, when required to do so by the provisions hereof, shall
not relieve any other Bank of its obligation hereunder to make its Advance on
the date of such borrowing, but no Bank shall be responsible for the failure of
any other Bank to make the Advance to be made by such other Bank. Nothing
herein shall prejudice any rights or remedies that the Borrowers may have
against any Bank as a result of any failure by such Bank to make an Advance
hereunder if such failure is in breach of its obligations hereunder.
2.3 LETTERS OF CREDIT.
(a) Subject to the terms and conditions hereof, including but not
limited to the limitations set forth in Subsection 2.1(a) and 2.4 hereof, the
Revolving Credit Commitments may be utilized, upon the request of the Borrowers,
for the issuance of standby letters of credit by the Issuing Bank ("Letters of
Credit"). Each Letter of Credit issued hereunder shall be in such form, contain
such terms, and support such transactions as shall be satisfactory to the
Issuing Bank in its sole discretion. No Letter of Credit shall have a term
extending beyond the earlier of (i) one year after the date of issuance or (ii)
the Revolving Credit Maturity Date.
(b) Each Letter of Credit shall be requested by the Borrowers by
irrevocable notice (effective upon receipt) from the Borrowers to the Issuing
Bank and the Agent (which shall promptly give notice thereof to the Banks) no
later than 10:00 a.m. (Eastern Time) three (3) Business Days prior to the date
of the proposed issuance of the Letter of Credit. Each such notice from the
Borrowers shall be in writing, or shall be by telephone or telecopier, confirmed
immediately in writing, specifying the proposed (i) date of issuance of the
Letter of Credit, (ii) maximum amount of such Letter of Credit, (iii) expiration
date of the Letter of Credit, (iv) name and address of the beneficiary of such
Letter of Credit, (v) form of such Letter of Credit, and (vi) description of
transaction supported by the Letter of Credit, and shall be evidenced by an
executed Notice of Borrowing. The request shall be accompanied by such other
applications, agreements, information, and documents as the Agent or the Issuing
Bank shall require, and the payment of the fees and commissions described in
Subsection 2.8 hereof.
(c) If the form of the Letter of Credit and transaction supported
by the Letter of Credit is satisfactory to the Issuing Bank in its sole
discretion, and subject to the other terms and conditions of this Agreement, the
Issuing Bank will make such Letter of Credit available to the Borrower
designated in the Notice of Borrowing at the Issuing Bank's Lending Office
described in the signature pages hereof or as otherwise agreed with the
Borrowers in connection with such issuance.
(d) Upon the issuance of any Letter of Credit by the Issuing Bank,
the Issuing Bank shall be deemed, irrevocably and without further action by any
party hereto, to have sold to each Bank, and each Bank shall be deemed,
irrevocably and without further action by any party hereto, to have purchased
from the Issuing Bank, an undivided interest and participation in, to the extent
of such Bank's Pro Rata Portion, the Letter of Credit and the related Letter of
Credit Contingent Obligation. The Issuing Bank shall notify the Agent of the
issuance of any Letter of Credit, and the Agent shall promptly notify each Bank
of such Bank's Pro Rata Portion of the amount of the Letter of Credit and the
related Letter of Credit Contingent Obligation. Each Bank's Pro Rata Portion of
the Letter of Credit Contingent Obligation shall be deemed to utilize the Bank's
Revolving Credit Commitment and reduce the availability thereunder, until such
time as the Letter of Credit Contingent Obligation terminates by virtue of
expiration of or payment under the Letter of Credit.
(e) The payment by the Issuing Bank of a draft drawn under a
Letter of Credit shall constitute for all purposes hereunder the making by the
Issuing Bank of a Revolving Credit Advance (which shall be a Prime Rate Advance
unless otherwise specified by the Borrowers in accordance with the procedures
contained in Subsection 2.15 hereof), in the amount of such payment (but without
any requirement for compliance with the requirements for the making of a
Revolving Credit Advance contained in Subsections 2.1 and 2.2 and Section 5
hereof).
(f) The Issuing Bank shall give the Agent prompt notice of any
presentation of a draw under a Letter of Credit in writing or by telephone or
telecopier, and the Agent shall give prompt notice thereof to the Banks. Each
Bank shall, on the date of receipt of such notice, either (i) make a Revolving
Credit Advance (which shall be a Prime Rate Advance unless otherwise specified
by the Borrowers in accordance with the procedures contained in Subsection 2.15
hereof) in an amount equal to its Pro Rata Portion of the payment under the
Letter of Credit, subject to the requirements for the making of a Revolving
Credit Advance contained in Subsection 2.1 and 2.2 and Section 5 hereof), and
shall simultaneously make available to the Issuing Bank at its Lending Office
specified in the signature pages hereof, in immediately available funds, the
proceeds of such Revolving Credit Advance, or (ii) if for any reason Borrowers
is not entitled on such day to receive a Revolving Credit Advance each Bank
shall pay to the Issuing Bank such Bank's Pro Rata Portion of such draw,
whereupon such Bank shall acquire a participation, to the extent of such Pro
Rata Portion, in the claim of the Issuing Bank against Borrowers in respect of
such draw.
(g) If and to the extent that any Bank shall not have so made the
proceeds of such a Revolving Credit Advance available to the Issuing Bank, the
Bank and the Borrowers severally agree to repay to the Issuing Bank forthwith
upon demand, to the extent not collected from the other, such corresponding
amount together with interest thereon, for each day from the date of receipt of
notice of the draw until the date the Bank's Pro Rata Portion thereof is paid to
the Issuing Bank at (i) in the case of the Borrowers, the interest rate
applicable at the time to the Advances, and (ii) in the case of the Bank, the
Federal Funds Rate, provided, however, that the Borrowers shall not be required
to so repay such amount if and to the extent that the Agent, in its capacity as
a Bank, has availability therefor under its Revolving Credit Commitment. In
such circumstances, the Agent, in its capacity as a Bank, may, but shall not be
required to, make an Advance under its Revolving Credit Commitment in respect of
such amount. If the Borrowers shall repay to the Agent such corresponding
amount, or if the Agent, in its capacity as a Bank, makes an Advance therefor,
such payment or Advance shall not relieve the delinquent Bank of its obligations
hereunder.
2.4 USE OF PROCEEDS. The Revolving Credit Facility and the proceeds
thereof shall be used by the Borrowers solely for the purpose of acquiring
income producing commercial restaurant and retail properties, either existing or
to be built, which construction must be completed within twelve (12) months
after acquisition of the fee simple estate, and which in any event, are subject
to long term lease agreements and, in an aggregate amount not to exceed Ten
Million Dollars ($10,000,000.00) at any time, for working capital purposes and
the issuance and funding of standby Letters of Credit; provided, however, that
Borrowers may also acquire income producing unsubordinated ground leases which
are intended to support income producing commercial restaurant and retail
properties upon completion and said completion occurs within a reasonable period
of time after acquisition of such ground lease so long as the total number of
such ground leases does not exceed five percent (5%) of the total number of
properties in the Borrowers' portfolio at any time. From time to time and upon
the Agent's request, the Borrowers shall furnish to the Agent evidence
satisfactory to the Agent that such proceeds are being used according to the
terms of this Subsection.
2.5 NOTE. The aggregate indebtedness of the Borrowers to each of the
Banks resulting from the Revolving Credit Advances shall be evidenced by a
single promissory note of the Borrowers payable to the Agent for the benefit of
the Banks, in a principal amount equal to One Hundred Million Dollars
($100,000,000.00) in substantially the form of Exhibit "A" hereto (as may be
amended, renewed, increased, restated, replaced, or otherwise modified from time
to time, the "Revolving Credit Note"). The Revolving Credit Note constitutes a
renewal and modification of the Existing Note which is replaced and superseded
in its entirety by the Revolving Credit Note.
2.5 INTEREST.
(a) The Borrowers shall pay interest on the unpaid principal
amount of each Advance from the date of such Advance until such principal amount
shall be paid in full, at the following rates per annum:
(i) during such periods as an Advance is a Prime Rate
Advance, a rate equivalent to the Prime Rate in effect from time to
time, which rate shall be adjusted daily to reflect changes in the
Prime Rate, with each adjustment to be effective on the day the
change occurs;
(ii) during such periods as an Advance is a LIBOR Rate
Advance, a rate equivalent to the Reserve Adjusted LIBOR Rate for
the Interest Period for such Advance plus one and 70/100 percent
(1.70%) per annum; and
(iii) after the maturity or due date of the Advance (whether
by acceleration or otherwise), a rate equivalent to five percent
(5%) per annum above the rate per annum required to be paid on such
Advance pursuant to paragraphs (i) or (ii) above (the "Default
Rate").
(b) The Borrowers shall pay interest, on demand, on all other
amounts in respect of any other obligations of the Borrowers under the Loan
Documents not paid when due at a rate per annum equal to five (5%) per annum
above the Prime Rate in effect from time to time, which rate shall be adjusted
daily to reflect changes in the Prime Rate, with each adjustment to be effective
on the day the change occurs.
2.7 REPAYMENT.
(a) Interest on the Revolving Credit Advances shall be paid to the
Agent for the account of the Banks as follows:
(i) Interest on each Prime Rate Advance shall be paid
quarterly in arrears on the last day of March, June, September, and
December of each year, and on the Revolving Credit Maturity Date.
(ii) In respect of any LIBOR Loan, interest shall be payable
at the relevant Elected Rate, in arrears, on the last day of the
applicable Interest Period, provided that interest on LIBOR Loans
shall additionally be payable on the 90th day of any Interest Period
that exceeds 90 days in duration.
(iii) In addition to the interest due and payable under (i)
and (ii) above, and as provided elsewhere in the Agreement, all
accrued interest shall be due and payable on each date when all of
the unpaid principal balance of the Credit shall be due (whether by
maturity, acceleration or otherwise).
(b) Principal under the Revolving Credit Advances, if not sooner
paid, shall be paid to the Agent on the Revolving Credit Maturity Date for the
account of the Banks.
(c) If any payment of principal or interest or both is more than
ten (10) days late, the Borrowers will pay to the Agent, for the account of the
Banks, a late charge equal to five percent (5%) of the payment (the "Late Fee").
The provisions herein for a Late Fee shall not be deemed to extend the time for
any payment or to constitute a "grace period" giving the Borrowers a right to
cure such default.
2.8 FEES.
(a) As consideration for making the Revolving Credit Facility
available, the Borrowers shall pay to the Agent, for the pro rata account of the
Banks based on the amounts of the then existing Revolving Credit Commitments, a
fee from the date hereof to the Revolving Credit Maturity Date (as may be
extended hereunder) equal to twenty (20) basis points per annum of the unused
portion of the aggregate Revolving Credit Commitments. Such fee shall be
computed on the basis of the average daily unused portion of the Banks' then
existing Revolving Credit Commitments and shall be payable quarterly in arrears
on each quarterly interest payment date described in Subsection 2.7 hereof.
Notwithstanding the foregoing, no additional fees shall be payable pursuant to
this Subsection in the event (i) the Banks cease to offer LIBOR Rate Advances
pursuant to Subsection 2.16 hereof and (ii) all borrowings hereunder have been
repaid in full by the Borrowers.
(b) The Borrowers shall pay the Issuing Bank a fee of 1% per annum
of the face amount of each Letter of Credit for any Letters of Credit issued
hereunder, payable quarterly in advance. One-eighth (1/8) of such fee shall be
retained by the Issuing Bank as issuing bank and the remaining seven-eighths
(7/8) of such fee shall be shared by the Banks (including the Issuing Bank)
based on the Pro Rata Portion of each. In addition, the Borrowers shall pay the
Issuing Bank such additional fees and charges as are customarily changed by the
Issuing Bank in respect of Letters of Credit.
(c) The Borrowers shall also pay to the Agent such agency and
other fees as the Agent and the Borrowers shall separately agree.
2.9 EXTENSION OF REVOLVING CREDIT MATURITY DATE. Upon the written
request of the Borrowers, which request shall be received by the Agent at least
sixty (60) days prior to the then existing Revolving Credit Maturity Date, the
Revolving Credit Maturity Date shall be extended a single time for a period of
twelve (12) months beyond the then existing Revolving Credit Maturity Date,
provided that the Borrowers have fully complied with all of the financial
covenants pursuant to Subsection 6.2 of this Agreement and materially complied
with all other covenants, terms, conditions and provisions of this Agreement for
the six (6) quarters preceding the then existing Revolving Credit Maturity Date.
In such event, the Borrowers may be required by the Agent, in its discretion, to
execute and deliver to the Banks, not later than the earlier Revolving Credit
Maturity Date, new Revolving Credit Notes, with appropriate inserts therein as
to date, date of payments, and any appropriate recitals.
2.10 SINGLE LOAN. The Advances and all other obligations arising under
this Agreement and the other Loan Documents shall constitute one general
obligation of the Borrowers and shall be secured by the Collateral. Recourse by
the Agent and the Banks to the Collateral will not be required at any time.
2.11 PAYMENTS AND COMPUTATIONS.
(a) The Borrowers shall make each payment due under the Note or
otherwise due hereunder not later than 12:00 p.m. (Eastern Time) on the day when
due to the Agent in immediately available funds. Any such payment received
later than 12:00 p.m. (Eastern Time) shall be deemed received by the Agent on
the following Business Day. In the event any such payment is received by the
Agent not later than 12:00 p.m. (Eastern Time), the Agent will thereafter on the
date such payment is received cause to be distributed like funds ratably to the
Banks, in each case to be applied in accordance with the terms of this
Agreement. If any such payment is received by the Agent after 12:00 p.m.
(Eastern Time), the Agent will thereafter on the following Business Day cause to
be distributed like funds ratably to the Banks, in each case to be applied in
accordance with the terms of this Agreement. In the event the Agent does not so
distribute such funds to the Banks, it shall pay interest thereon, for each day
from the Business Day following the date such amount is payable to the Banks to
the date the Agent repays such amount to the Banks, at the Federal Funds Rate.
(b) If the Agent receives funds for application to the Advances
under circumstances for which the Loan Documents or the Borrowers (to the extent
permitted by the Loan Documents) do not specify the Advances to which, or the
manner in which, such funds are to be applied, the Agent shall distribute such
funds for application to the Advances to each Bank ratably in accordance with
such Bank's Pro Rata Portion of all outstanding Advances, in repayment or
prepayment of such of the outstanding Advances of such Bank, and for application
to such principal installments or interest.
(c) Unless the Agent shall have received notice from the Borrowers
prior to the date on which any payment is due to any Banks hereunder that the
Borrowers will not make such payment in full, the Agent may assume that the
Borrowers have made such payment in full to the Agent on such date. The Agent
may, in reliance upon such assumption, cause to be distributed to each Bank on
the Business Day following the date when due an amount equal to the amount then
due to such Bank. If and to the extent the Borrowers shall not have made such
payment in full to the Agent, each such Bank shall repay to the Agent forthwith
on demand such amount distributed to such Bank together with interest thereon,
for each day from the date such amount is distributed to such Bank until the
date such Bank repays such amount to the Agent, at the Federal Funds Rate.
(d) Each payment and prepayment by the Borrowers of principal or
interest shall be made in such coin or currency of the United States of America
as at the time of payment is legal tender for the payment of public and private
debt. If any installment of principal or interest becomes due and payable on a
day other than a Business Day, the due date thereof shall be extended to the
next succeeding Business Day (except as otherwise provided with respect to LIBOR
Advances in the definition of "Interest Period"), and, in the case of principal,
interest shall be payable during the extension at the annual rate specified in
the note for the payment of interest before maturity.
(e) Unless otherwise specified herein, or unless otherwise
determined by the Required Banks in their sole discretion, all payments (other
than prepayments) of a particular Advance shall be applied pro rata among the
Banks first to interest and lawful charges then accrued and then to principal.
The Borrowers shall, at the time of making payments of Advances, specify to the
Agent (which shall so notify the Banks) of the Advances to be paid.
(f) Each Borrower hereby authorizes the Agent and each Bank, if
and to the extent that any payments owed hereunder are not made when due, to
charge such payments from time to time against any or all of such Borrower's
accounts with the Agent or the Bank, in which event the Agent or the Bank will
give prompt notice to such Borrower of such charge; provided, however, that the
failure to give such notice shall not affect the validity of such charge. Any
such Bank will give notice to the Agent thereof.
(g) Interest and any fees hereunder shall be computed on the basis
of a year of 360 days, but charged for the actual number of days elapsed. Each
determination by the Agent of an interest rate hereunder shall be conclusive and
binding for all purposes, absent manifest error.
(h) Notwithstanding anything contained herein to the contrary, in
no event shall any interest rate provided for herein exceed the maximum rate of
interest allowed by applicable law, as amended from time to time. Neither the
Banks nor the Agent intend to charge any amount of interest or other fees or
charges in the nature of interest that exceeds the maximum amount allowed by
applicable law. If any payment of interest or in the nature of interest would
cause the foregoing interest rate limitation to be exceeded, then such excess
payment shall be credited as a payment of principal, unless the Borrowers notify
the Agent in writing that the excess payment must be returned to the Borrowers,
together with interest at the rate specified in Section 687.04(2), Florida
Statutes, or any successor statute.
2.12 PREPAYMENTS UNDER REVOLVING CREDIT FACILITY.
(a) The Borrowers shall be entitled to prepay Prime Rate Advances
in whole or in part, at any time, without premium or penalty, upon notice to the
Agent no later than 10:00 a.m. (Eastern Time) on the proposed date of the
prepayment, each notice stating the proposed date, Advances to be prepaid, and
aggregate principal amount of the prepayment.
(b) Notwithstanding the provisions of Subsection 2.13 hereof, the
Borrowers shall be entitled to pay LIBOR Rate Advances only on the last days of
the applicable Interest Periods, without premium or penalty, upon notice to the
Agent no later than 10:00 a.m. (Eastern Time) at least three (3) Business Days
prior to the proposed date of the prepayment, each notice stating the proposed
date, Advances to be paid, and aggregate principal amount of the payment.
(c) Any prepayment of Prime Rate Advances shall be in the
aggregate principal amount of $100,000.00 or an integral multiple thereof, and
any payment of LIBOR Rate Advances shall be in the full amount of the LIBOR Rate
Advances so paid.
(d) On or prior to the Revolving Credit Maturity Date, any
prepayment of Revolving Credit Advances (whether optional or required, but not
including any payment after default or acceleration) shall be applied first to
principal and then to interest and lawful charges, unless otherwise specified by
the Borrowers. In the event of a prepayment after default or acceleration, any
prepayment of Revolving Credit Advances shall be applied first to interest
accrued on the principal amount prepaid (to be allocated among the Advances
according to amount of interest accrued) and other lawful charges, and then to
principal. The Borrowers shall, at the time of making prepayments of Advances,
specify to the Agent (which shall so notify the Banks) of the Advances to be
prepaid.
2.13 LIBOR RATE COMPENSATION. Notwithstanding the provisions of
Subsection 2.12(b) hereof, which prohibit prepayment of LIBOR Rate Advances
prior to the end of the applicable Interest Period, in the event that all or any
portion of any LIBOR Rate Advances are repaid, prepaid, or Converted prior to
the end of the applicable Interest Period, regardless of whether such payment or
Conversion is optional or obligatory, or in the event that any LIBOR Rate
Advances are not borrowed or Converted as specified in a notice given pursuant
to Subsection 2.2 or 2.15 hereof for any reason, including the failure of any
conditions precedent, the Borrowers shall be required to pay to the Agent, for
the account of the Banks, compensation as follows. The Borrowers shall be
required to pay an amount equal to the excess, if any, of (i) the amount of
interest which otherwise would have accrued on the portion of the LIBOR Rate
Advances repaid, prepaid, Converted, or not borrowed or Converted from and after
the date of such payment, prepayment, Conversion, failure to borrow, or failure
to Convert, to the last day of the applicable Interest Period (or, in the case
of a failure to borrow or Convert, to the last day of the Interest Period which
would have commenced) at the applicable rate of interest for such Advances
specified herein, minus (ii) the amount of interest which would have accrued on
such LIBOR Rate Advances or portion thereof from and after the date of such
payment, prepayment, Conversion, failure to borrow, or failure to Convert, to
the last day of the applicable Interest Period at the applicable rate of
interest for such Advances specified herein, but calculated with respect to a
LIBOR Rate based on an amount substantially equal to the amount paid, prepaid,
Converted, or not borrowed or Converted, and an Interest Period substantially
equal to the number of days remaining in the applicable Interest Period.
Whether or not the foregoing calculation results in a charge to be paid by the
Borrowers, the Borrowers shall also pay all actual out-of-pocket expenses other
than those taken into account in the foregoing calculation incurred by the Banks
and the Agent (excluding any internal expenses) and reasonably attributable to
such payment, prepayment, Conversion, or failure to borrow or Convert. The
Borrowers acknowledge that the Banks are relying in the LIBOR Rate Advances
remaining outstanding or being borrowed or Converted for the entire Interest
Periods selected, and that the foregoing compensation represents reasonable
liquidated damages and is not a penalty. The foregoing compensation shall apply
with respect to all payments, prepayments, and Conversions of LIBOR Rate Advance
and all failures to borrow and failures to Convert into LIBOR Rate Advances,
whether optional or obligatory (including any required principal installments
and any required Conversions pursuant to the provisions of Subsections 2.15 and
2.16 hereof), and shall include any prepayment, repayment, or Conversion after
default or acceleration of the Note.
2.14 SHARING OF PAYMENTS, ETC.
(a) If any Bank shall obtain from any Borrower payment of any
principal of or interest on any Advance owing to it or payment of any other
amount under this Agreement or any other Loan Document through the exercise of
any right of set-off, banker's lien, counterclaim, similar right, or otherwise
(other than from the Agent as provided herein), and, as a result of such
payment, such Bank shall have received a greater percentage of the principal of
or interest on the Advances or other amounts then due hereunder by Borrowers to
such Bank than the percentage received by any other Banks, it shall promptly
purchase from such other Banks participations in (or, if, and to the extent
specified by such Bank, direct interests in) the Advances or such other amounts,
respectively, owing to such other Banks (or in interest due thereon, as the case
may be) in such amounts, and make such other adjustments from time to time as
shall be equitable, to the end that all the Banks shall share the benefit of
such excess payment (net of any expenses which may be incurred by such Bank in
obtaining or preserving such excess payment) pro rata in accordance with the
unpaid principal of and interest on the Advances or such other amounts,
respectively, owing to each of the Banks. To such end all the Banks shall make
appropriate adjustments among themselves (by the resale of participations sole
or otherwise) if such payment is rescinded or must otherwise be restored.
(b) Nothing contained herein shall require any Bank to exercise
any such right or shall affect the right of any Bank to exercise, and retain the
benefits of exercising, any such right with respect to any other indebtedness or
obligation of any Borrower. If, under any applicable bankruptcy, insolvency, or
other similar law, any Bank receives a secured claim in lieu of a set-off to
which this Subsection applies, such Bank shall, to the extent practicable,
exercise its rights in respect of such secured claim in a matter consistent with
the rights of the Banks entitled under this Subsection to share in the benefits
of any recovery on such secured claim.
2.15 CONVERSION AND CONTINUATION OF ADVANCES; FAILURE TO SELECT INTEREST
PERIOD.
(a) The Borrowers may, upon notice given to the Agent (effective
upon receipt) no later than 10:00 a.m. (Eastern Time) at least three (3)
Business Days prior to the date of a proposed Conversion into or Continuation of
LIBOR Rate Advances and not later than 10:00 a.m. (Eastern Time) at least one
(1) Business Day prior to the date of a proposed Conversion into Prime Rate
Advances, and subject to the provisions hereof, Convert Advances of one Type
into Advances of the other Type or Continue Advances of one Type as Advances of
the same Type at any time and from time to time on any Business Day; provided,
however, that (i) any Conversion or Continuation of LIBOR Rate Advances shall be
made on, and only on, the last day of the Interest Period for the LIBOR Rate
Advances being Converted or Continued, (ii) any Conversion or Continuation of
any Advances into LIBOR Rate Advances shall be in amounts not less than the
minimum aggregate amounts specified in Section 2.2(a), and (iii) no Conversion
or Continuation of Advances shall result in a greater number of different
Interest Periods for LIBOR Rate Advances than is permitted under Section 2.2(b).
Each such notice of Conversion or Continuation shall be in writing or shall be
by telephone or telecopier, confirmed immediately in writing, specifying, within
the restrictions specified above, the date of such Conversion or Continuation,
the Advances to be Converted or Continued, the portion thereof to be Converted
or Continued, and the Type of Advances into which they will be Converted or
Continued, and if such Conversion or Continuation is into LIBOR Rate Advances,
the duration of the Interest Periods for such Advances. Each notice of
Conversion or Continuation shall be irrevocable and binding on the Borrowers.
(b) (i) Whenever the unpaid principal amount of LIBOR Rate
Advances comprising a borrowing shall be reduced, by payment or prepayment or
otherwise, to less than $1,000,000.00, such Advances shall automatically Convert
into Prime Rate Advances on the last day of the then current Interest Period
with respect to such Advances.
(ii) If the Borrowers shall fail to give a notice of
Conversion or Continuation in respect of LIBOR Rate Advances prior to the end of
the Interest Period applicable thereto as provided in paragraph (a) hereof, or
to select the duration of any Interest Period for any LIBOR Rate, such LIBOR
Rate Advances will automatically, on the last day of the then existing Interest
Period therefor, convert into Prime Rate Advances.
(iii) Upon the occurrence and during the continuance of any
Event of Default, (i) all LIBOR Rate Advances will automatically, on the last
days of the then existing Interest Periods therefor, Convert into Prime Rate
Advances and (ii) the obligation of the Banks to make, Continue, or Convert
Advances into LIBOR Rate Advances shall be suspended.
(iv) LIBOR Rate Advances may be subject to automatic
Conversion into Advances of other Types, as provided in Section 2.16(c) and (d).
2.16 INCREASED COSTS, ILLEGALITY, ETC.
(a) If either (i) the introduction of or any change in any law or
regulation or in the interpretation or administration of any law or regulation
by any court or administrative or governmental authority charged with the
interpretation of administration thereof from the date hereof or (ii) the
compliance with any guideline or request from any such governmental authority,
including, without limitation, any central bank (whether or not having the force
of law), (x) subjects any Bank or any corporation controlling any Bank to any
tax of any kind whatsoever with respect to this Agreement or any Advance, or
changes the basis of taxation of payments to such Bank or corporation of
principal, commissions, fees, interest, or any other amount payable hereunder
(except for (A) taxes on or measured by the overall net income of such Bank or
branch, office, or agency through which such Bank is acting for purposes of this
Agreement or (B) changes in the rate of such taxes); (y) imposes, modifies, or
holds applicable any reserve, special deposit, compulsory loan, or similar
requirement against assets held by, or deposits or other liabilities in or for
the account of, advances or loans by, or other credit or commitment therefor
extended by, or any other acquisition of funds by, any office of such Bank which
are not otherwise included in any determination of the Reserve Adjusted LIBOR
Rate or other interest payable hereunder; or (z) imposes on any Bank or the
corporation controlling the Bank any other condition, and as a result there
shall be any increase in the cost to the Bank or the corporation of agreeing to
make or making, funding, or maintaining Advances by an amount deemed by the Bank
to be material, then the Borrowers shall from time to time, upon demand by the
Bank, pay directly to the Bank additional amounts sufficient to compensate the
Bank for such increased cost. A certificate as to the amount of such increased
cost, submitted to the Borrowers by the Bank, shall be conclusive and binding
for all purposes, absent manifest error.
(b) If any Bank determines that compliance with any law or
regulation or with any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) concerning
capital adequacy or otherwise has or would have the effect of reducing the rate
of return on the capital of the Bank or the corporation controlling the Bank, as
a consequence of, or with reference to, the facilities hereunder, or its making
or funding or maintaining Advances below the rate which the Bank or such other
corporation could have achieved but for such compliance (taking into account the
policies of the Bank of such corporation with regard to capital) by an amount
deemed by the Bank to be material, the Borrowers shall from time to time, upon
demand by the Bank, pay to the Bank additional amounts sufficient to compensate
the Bank or such other corporation for such reduction. A certificate as to such
amounts, submitted to the Borrowers by the Bank, shall be conclusive and binding
for all purposes, absent manifest error.
(c) If, with respect to any LIBOR Rate Advances, the Required
Banks notify the Agent that the Reserve Adjusted LIBOR Rate for any Interest
Period for such Advances will not adequately reflect the cost to the Banks of
making, funding, or maintaining the LIBOR Rate Advances for such Interest
Period, the Agent shall forthwith so notify the Borrowers whereupon (i) each
such LIBOR Rate Advance, will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Prime Rate Advance, and (ii)
the obligation of the Banks to make, Continue, or Convert Advances into LIBOR
Rate Advances shall be suspended until the Agent notifies Borrowers that the
Required Banks have determined that the circumstances causing such suspension no
longer exist.
(d) Notwithstanding any other provision of this Agreement, if the
introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful or any central bank or other governmental
authority shall assert that it is unlawful for any Bank to perform its
obligations hereunder to make LIBOR Rate Advances or to continue to fund or
maintain LIBOR Rate Advances hereunder, then, on notice thereof and demand
therefor by the Bank through the Agent, (i) each LIBOR Rate Advance of the Banks
will automatically, upon such demand, Convert into a Prime Rate Advance and (ii)
the obligation of the Banks to make, Continue, or Convert Advances into LIBOR
Rate Advances shall be suspended until the Agent shall notify the Borrowers that
the Bank has determined that the circumstances causing such suspension no longer
exist.
2.17 LETTERS OF CREDIT OBLIGATIONS.
(a) The payment obligations of the Borrowers under this Agreement
with respect to the Letters of Credit shall be unconditional and irrevocable,
and shall be paid strictly in accordance with the terms of this Agreement under
all circumstances, including, without limitation, the following circumstances:
(i) any lack of validity or enforceability of the Letters of
Credit;
(ii) any amendment or waiver of or any consent to departure
from all or any of the Letters of Credit;
(iii) the existence of any claim, set-off, defense or other
right which the Borrowers may have at any time against any beneficiary, or any
transferee, of the Letters of Credit (or any Person for whom any such
beneficiary or transferee may be acting), the Agent, the Issuing Bank, any of
the other Banks, or any other person or entity, whether in connection with this
Agreement, the transactions contemplated herein or in the Letters of Credit, or
any unrelated transaction;
(iv) any statement or any other document presented under the
Letters of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect;
(v) payment by the Issuing Bank under the Letters of Credit
against presentation of a draft or certificate which does not comply (other than
on its face) with the terms of the Letters of Credit; or
(vi) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing.
(b) In addition to (but without duplication of) the amounts
payable as elsewhere provided in this Agreement, or any obligation arising out
of Letters of Credit, the Borrowers hereby agree to protect, indemnify, pay, and
save the Agent, the Issuing Bank, and each other Bank harmless from and against
any and all claims, demands, liabilities, damages, losses, costs, charges, and
expenses (including reasonable attorneys' fees) which such party may incur or be
subject to as a consequence, direct or indirect, of (i) the issuance of the
Letters of Credit, or (ii) the failure by the Issuing Bank to honor, or to make
payment on, a drawing under the Letters 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
"Governmental Acts").
(c) As among the Borrowers, the Issuing Bank, the other Banks, and
the Agent, the Borrowers assume all risks of the acts and omissions of, or
misuse of the Letters of Credit. In furtherance, and not in limitation of the
foregoing, none of the Agent or the Banks shall be responsible: (A) for the
form, validity, sufficiency, accuracy, genuineness, or legal effect of any
document submitted by any party as beneficiary or transferee or otherwise in
connection with a drawing under the Letters of Credit, even if it should in fact
prove to be in any or all respects invalid, insufficient, inaccurate,
fraudulent, or forged; (B) for the validity or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign the Letters of
Credit or the rights or benefits thereunder or proceeds thereof, in whole or in
part, which may prove to be invalid or ineffective for any reason; (C) for
failure of the beneficiary or transferee to comply fully with conditions
required in order to draw upon the Letters of Credit, other than conditions
expressly stated in the Letters of Credit; (D) for 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) for
errors in interpretation of technical terms; (F) for any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under the Letters of Credit or of the proceeds thereof; (G) for the
misapplication by the beneficiary of the Letters of Credit; and (H) for any
consequences arising from causes beyond the control of the Agent, the Issuing
Bank, or the other Banks including, without limitation, any Governmental Acts.
None of the above shall affect, impair, or prevent the vesting of any of the
Agent's, Issuing Bank's, or any other Bank's rights or powers hereunder.
(d) In furtherance and extension, and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by the
Agent, the Issuing Bank, or any other Bank under or in connection with the
Letters of Credit or the related certificates, if taken or omitted in good
faith, shall not result in any liability of the Agent, the Issuing Bank, or any
other Bank to the Borrowers. The Issuing Bank may accept documents that appear
on their face to be in order, without responsibility for further investigation,
regardless of any notice or any information to the contrary.
(e) Notwithstanding anything to the contrary contained in this
Subsection, the Borrowers shall have no obligation to indemnify the Issuing
Bank, any other Bank, or the Agent in respect of any liability incurred by the
Borrowers arising solely out of the bad faith, gross negligence or willful
misconduct of the Agent, the Issuing Bank, or any other Bank, as determined by a
court of competent jurisdiction.
(f) Without prejudice to the survival of any other obligation of
the Borrowers under this Agreement, the indemnities and obligations of the
Borrowers under this Subsection shall survive the payment in full of all other
amounts payable under this Agreement and the termination of the Letters of
Credit.
SECTION 3. SECURITY DOCUMENTS.
Payment of the Credit shall be secured as provided in this Section 3.
3.1 SECURITY AGREEMENT. To secure payment of the Credit, including but
not limited to contingent obligations under Letters of Credit, and all other
obligations of the Borrowers under the Loan Documents, the Borrowers hereby
grant the Agent and the Banks and this Agreement shall be deemed to create,
grant, give, and convey to the Agent and the Banks a first priority lien and
encumbrance upon, and a first priority security interest in, the Collateral.
This Agreement shall also serve as a "Security Agreement" within the meaning of
that term as used in the Uniform Commercial Code as adopted and in force from
time to time in the State of Florida, and shall be operative and effective as a
Security Agreement in addition to, and not in substitution for, any other
Security Agreement executed by the Borrowers in connection with the extension of
credit or loan transaction secured hereby. The Borrowers agree to and shall,
upon the request of the Agent, execute and deliver to the Agent, in form
satisfactory to the Agent, such "Financing Statements," descriptions of property
and such further assurances as the Agent, in its sole discretion, may from time
to time consider necessary to create, perfect, continue, and preserve the lien
and encumbrances hereof and the security interest granted herein upon and in
such Collateral. The Agent, at the expense of the Borrowers, may or shall cause
such statements, descriptions, and assurances to be recorded and re-recorded,
filed and re-filed, at such times and in such places as may be required or
permitted by law to so create, perfect, and preserve the lien and encumbrances
hereof upon all of said Collateral. In addition to any other rights and
remedies contained in the Loan Documents, the Agent and the Banks shall have all
the rights and remedies of a secured party under the Uniform Commercial Code as
adopted and in force from time to time in the State of Florida or other
applicable law, all of which rights shall be cumulative and non-exclusive, to
the extent permitted by law.
3.2 OWNERSHIP AND ENCUMBRANCE OF PROPERTY. Subject to any mortgages
permitted pursuant to Section 7.2 hereof, each Borrower hereby agrees and
represents to the Agent and the Banks that the properties now owned by such
Borrower are not subject to any mortgage, lien, charge, encumbrance, or security
interest. Subject to Sections 7.1 and 7.2 hereof, no Borrower shall, without
the prior written consent of Required Banks, permit or suffer to exist any
mortgage, lien, charge, encumbrance, or security interest in or upon any
properties now owned or hereafter acquired by such Borrower.
3.3 ADDITIONAL SECURITY DOCUMENTS. The Borrowers further agree to
prepare, execute, and deliver to the Agent the following documents (together,
the "Security Documents") each of which shall be properly completed with all
pertinent information and otherwise satisfactory to the Agent:
(a) a Notice of Borrowing, in the form attached as Exhibit "B" to
this Agreement at the time of each request for an Advance under the
Credit;
(b) an Agreement Not To Encumber for each property now owned by
any Borrower, except as otherwise provided for in this Agreement, which
includes a correct legal description of such property in the form attached
hereto as Exhibit "C" at closing and subsequently at the time any real
property is hereafter acquired by any Borrower or an Agreement Not to
Encumber which includes a correct legal description of such property in
the form attached hereto as Exhibit "G" for each property pursuant to
which any Borrower hereafter acquires a leasehold interest permitted
pursuant to Section 2.4 hereof;
(c) a Collateral Assignment of Leases, Rents, and Profits of, from
or pertaining to each property owned by any Borrower, in the form attached
hereto as Exhibit "D" at closing and subsequently at the time any real
property is hereafter acquired by any Borrower executed by such Borrower
or a Collateral Assignment of Leases, Rents, and Profits, of, from or
pertaining to each property in which Borrowers hereafter acquires a
leasehold interest permitted pursuant to Section 2.4 hereof in the form
attached hereto as Exhibit "H" and such Borrower shall use its best
efforts to obtain an acknowledgement of lessee thereon or on a form
satisfactory to Agent in its sole discretion;
(d) an Agreement between the Agent on behalf of the Banks, any
Borrower and the landlord with respect to any leasehold interest hereafter
acquired by any Borrower in substantially the form attached hereto as
Exhibit "I", which form must be acceptable to Agent in its sole
discretion;
(e) UCC Financing Statements, for filing with the Secretary of
State and the local recording office of the State and County where the
property of any Borrower is located, in the form required by such State
and County, reflecting the Banks' security interest in the Collateral at
closing and subsequently at the time any real property is hereafter
acquired by any Borrower; provided, however, that the Agent, in its sole
discretion, may prepare any such Financing Statements upon receipt of the
other documents provided for in this Section 3.3 and forward such
completed Financing Statements to any Borrower for execution;
(f) an Anti-Coercion Statement for each property owned by any
Borrower in the form attached hereto as Exhibit "E" at closing and
subsequently at the time any real property is hereafter acquired by any
Borrower;
(g) evidence of Owner's Title Insurance Policy or commitment
binder therefor for each property owned by any Borrower at closing and
subsequently at the time any real property is hereafter acquired by any
Borrower;
(h) evidence that each property owned by any Borrower at closing
and any property hereafter acquired by any Borrower is insured with fire
and extended coverage to the full insurable value of the requirements on
any such property, and each Borrower hereby agrees that any proceeds from
such insurance coverage will be applied by such Borrower to (i) repair or
rebuild the property for which such proceeds are being received, (ii)
replace such property with a substantially equivalent property with a
substantially equivalent stream of rent payments of similar credit
quality, or (iii) repay any borrowings hereunder;
(i) copies of lease agreements applicable to each property owned
by any Borrower at closing and subsequently at the time any real property
is hereafter acquired by any Borrower; and
(j) an M.A.I. or state certified appraisal or an appraisal in
compliance with the Appraisal Standards for Federally Regulated
Transactions, as required by the Federal Financial Institution Reform
Recovery and Enforcement Act of 1989, as amended from time to time, and
related or subsequent regulations for any real property hereafter acquired
by any Borrower, prepared by an appraiser approved by the Agent and
otherwise in form and substance satisfactory to the Agent.
3.4 RELEASE OF PROPERTY.
(a) Upon the request of the Borrowers, the Agent on behalf of the
Banks will, so long as there exists no Event of Default or circumstance
which with the giving of notice or passage of time would become an Event
of Default, execute releases of property from the lien and encumbrance of
the Security Documents, provided that (a) each property to be released is
being sold in the ordinary course of business to bona fide unrelated third
parties, (b) either (i) each such property is being replaced with
substantially equivalent property with a substantially equivalent stream
of rent payments of similar credit quality, or (ii) the sale of such
property is for cash and the proceeds of the sale, net only of reasonable
seller's closing costs, are applied by the Borrowers as a prepayment of
the Revolving Credit Facility, (c) the property to be released consists of
the entire parcel or parcels of property acquired and is not a mere
portion thereof, and (d) the Borrowers shall submit to the Agent properly
prepared release documents in a form satisfactory to Agent, and with
respect to any new parcel described in clause (b)(i) hereof, properly
prepared Security Documents for such parcel, the warranty deed and closing
statement for such property or properties, and such other information as
the Agent shall reasonably request. The Banks hereby authorize the Agent
to execute such releases and accept the substitution of such Security
Documents under the foregoing conditions without the necessity of notice
to or consent or agreement of the Banks or the Required Banks. If
required by any title company, any Bank will furnish then current
confirmation of the Agent's continued authority to execute and deliver
release documents in connection with any property as provided for in this
Subsection.
(b) Notwithstanding anything to the contrary in this Agreement,
Agent agrees, on behalf of Banks, to execute releases of those properties
of CNLR listed on Schedule I attached hereto from the lien and encumbrance
of the Existing Security Documents in the form of the Release of
Collateral Assignment of Leases, Rents, and Profits and Security Agreement
and UCC-1 Financing Statement attached hereto as Exhibit "J" or in a form
otherwise required by a title insurance company in connection with
Principal Mutual Life Insurance Company's, or an affiliate thereof,
mortgages on such properties. Upon such execution, such properties shall
no longer be included as part of the Collateral hereunder. These releases
of liens and encumbrances are being given to facilitate CNLR's securing of
mortgage loans from Principal Mutual Life Insurance Company, or an
affiliate thereof, totaling not more than $52,600,000.00 on the properties
listed on Schedule I attached hereto. Pursuant to Section 6.18 hereof,
all net proceeds from any such loans shall be applied by CNLR to prepay
outstanding Advances hereunder.
SECTION 4. REPRESENTATIONS AND WARRANTIES.
To induce the Agent and the Banks to enter into this Agreement and to
establish the Credit provided for herein, each Borrower represents and warrants
to the Agent and Banks (which representations and warranties shall survive the
delivery of the documents mentioned herein and the establishment of the Credit
contemplated hereby) as follows:
4.1 CORPORATE EXISTENCE OF BORROWER; COMPLIANCE WITH LAW. The Borrower
is a corporation duly incorporated and organized, validly existing, and in good
standing under the laws of the State of Maryland. The Borrower has the
corporate power to own its properties and assets, and to carry on its business
as now being conducted. The Borrower is in compliance with all other
requirements of law applicable to it and to its business.
4.2 AUTHORIZATION. The Borrower has the corporate power and authority,
and the legal right to execute, deliver, and perform the Loan Documents, and to
borrow thereunder, and has taken all action necessary to authorize the
execution, delivery, and performance of the Loan Documents, and to authorize the
borrowings contemplated thereby. The execution, delivery, and performance of
the Loan Documents by the Borrower is made by individuals of legal capacity;
will not conflict with, result in the breach of, or constitute a violation of or
default under, any applicable law, rule, regulation, writ, or decree or the
charter or bylaws of the Borrower, or any agreement or instrument to which the
Borrower is a party; or result in the creation of any lien, charge, or
encumbrance upon any property or assets of the Borrower pursuant to any
indenture or other agreement or instrument to which the Borrower is a party, or
by which the Borrower or its Collateral may be bound or affected. No consent,
license, or authorization of, or filing with, any Person or entity (including,
without limitation, any Governmental Authority), is required in connection with
the execution, delivery, performance, validity, or enforceability of the Loan
Documents and the borrowings as contemplated thereunder, except for consents,
licenses, approvals, and filings referred to or disclosed in the Loan Documents.
4.3 ENFORCEABLE OBLIGATIONS. The Loan Documents when executed and
delivered to the Agent will constitute legal, valid, and binding agreements
enforceable against the respective parties thereto and any property described
therein in accordance with their respective terms, except (i) as enforceability
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium,
or similar laws affecting the enforceability of creditor's rights; and (ii) as
enforceability may be limited or qualified by general principles of equity,
whether raised in a proceeding at law or in equity.
4.4 FINANCIAL CONDITION OF THE BORROWERS.
(a) The consolidated financial statements of the Borrowers as of
__________________, 1995, a copy of which has been furnished to the Agent, are
materially correct, complete, and fairly present the financial condition of the
Borrowers as at the date of the financial statements and fairly present the
results of the operations of the Borrowers for the period covered thereby.
(b) The Borrowers have no material direct or contingent
liabilities, liabilities for taxes, long-term leases, or unusual forward or
long-term commitments as of the date of the Agreement which are not disclosed
by, provided for, or reserved against in the financial statements or referred to
in notes thereto, and at such date there are no material unrealized or
anticipated losses from any unfavorable commitments of the Borrowers. The
financial statements furnished to the Agent have been prepared in accordance
with Generally Accepted Accounting Principles applied on a Consistent Basis
maintained throughout the period involved. There has been no material adverse
change in the business, properties or condition, financial or otherwise, of the
Borrowers since the date of such financial statements.
4.5 NO LITIGATION. Except as disclosed in a Form 10-K or Form 10-Q
filed by the Borrower with the Securities and Exchange Commission, there is no
suit or proceeding at law or in equity (including proceedings, by or before any
court, arbitrator, governmental or administrative commission, board or bureau,
or other administrative agency) pending, or to the knowledge of the Borrower
threatened, by or against or involving the Borrower or against any of its
properties, existence, or revenues which, if adversely determined, would have a
material adverse effect on the property, assets, or business or on the
condition, financial or otherwise, of the Borrowers or which would be required
to be disclosed in notes to any balance sheet as of the date hereof of the
Borrowers prepared in reasonable detail in accordance with Generally Accepted
Accounting Principles applied on a Consistent Basis.
4.6 DISCLOSURE AND NO UNTRUE STATEMENTS. No representation or warranty
made by the Borrower in the Loan Documents or which will be made by the Borrower
from time to time in connection with the Loan Documents (a) contains or will
contain any misrepresentation or untrue statement of fact; or (b) omits or will
omit to state any material fact necessary to make the statements therein not
misleading, unless otherwise disclosed in writing to the Agent. There is no
fact known to the Borrower or any of its executive financial officers which
adversely affects, or which might in the future adversely affect, the business,
assets, properties, or condition, financial or otherwise, of the Borrower.
4.7 TITLE TO ASSETS; LEASES IN GOOD STANDING. The Borrower has good and
marketable title to its properties and assets, including the properties and
assets reflected in the financial statements and notes thereto described in
Section 4.4 hereof, except for such assets as have been disposed of in the
ordinary course of business, and all such properties and assets are free and
clear of all liens, mortgages, pledges, security interests, charges, title
retention agreements, or other encumbrances of any kind, except as otherwise
permitted pursuant to this Agreement. The Borrower enjoys peaceful and
undisturbed possession under all leases under which it is now operating, none of
which contain any unusual provisions which may adversely affect its operations,
and all said leases are valid, subsisting, and in full force and effect, and the
Borrower is not in violation of any material term of any such lease.
4.8 PAYMENT OF TAXES. The Borrower has filed or caused to be filed all
federal, state, and local tax returns which are required to be filed by it and
has paid or caused to be paid all taxes as shown on said returns or on any
assessment received by it, to the extent that such taxes have become due, except
as otherwise permitted by the provisions hereof, and no controversy in respect
of additional income taxes of the Borrower is pending, or, to the knowledge of
the Borrower, threatened. The Borrower has set up reserves which are believed
by its officers to be adequate for the payment of all taxes for which a notice
of assessment has been received and for the payment of such taxes for the years
that have not been audited by the respective tax authorities.
4.9 AGREEMENT OR CONTRACT RESTRICTIONS. The Borrower is not a party to,
nor is it bound by, any agreement, contract, or instrument or subject to any
charter or other corporate or partnership restriction which materially adversely
affects the business, properties, assets, operations, or condition, financial or
otherwise, of the Borrower except as disclosed in the financial statements and
notes thereto described in Subsection 4.4 hereof. The Borrower is not in
default in the performance, observance, or fulfillment of any obligations,
covenants, or conditions contained in any agreement or instrument to which it is
a party, which would have a material adverse affect on Borrower performing
hereunder.
4.10 PATENTS, TRADEMARKS, ETC. The Borrower owns, possesses, or has the
right to use all necessary patents, patent rights, licenses, trademarks,
trademark rights, trade names, trade name rights, and copyrights to conduct its
business as now conducted, without known conflict with any patent, patent right,
license, trademark, trademark right, trade name, trade name right, or copyright
of any other Person or entity.
4.11 RACKETEER INFLUENCED AND CORRUPT ORGANIZATION(S) ACT. The Borrower
has never been nor is it now engaged, nor will the Borrower engage, directly or
indirectly, in any pattern of "racketeering activity" or in any "collection of
any unlawful debt," as each of the quoted terms or phrases is defined or used by
the Racketeer Influenced and Corrupt Organization(s) Act of either the United
States or the ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, Section 1961 et
seq.; Chapter 895, Florida Statues, respectively, as each act now exists or is
hereafter amended (the "RICO Lien Acts"). No real property of the Borrower, no
interest or interests of any kind, including beneficial interest or interests,
mortgages, and leases, in or on real property of the Borrower, and no personal
property, including money, of the Borrower, has ever been, is now, or is in any
way reasonably anticipated by the Borrower to become, subject to any lien,
notice, civil investigative demand, action, suit, or any proceeding pursuant to
the RICO Lien Acts.
4.12 INVESTMENT COMPANY ACT; REGULATION. (a) The Borrower is not an
"investment company," an "affiliated person" of any investment company," or a
company "controlled" by an "investment company," and the Borrower is not an
"investment advisor" or an "affiliated person" of an "investment advisor" (as
each of the quoted terms is defined or used in the Investment Company Act of
1940, as amended).
(b) The Borrower is not subject to regulation under any state or
local public utilities code or federal, state, or local statute or regulation
limiting the ability of the Borrower to incur indebtedness for money borrowed or
to pledge assets of the type contemplated hereunder.
4.13 LABOR MATTERS. There are no strikes or other labor disputes against
the Borrower pending or, to the Borrower's knowledge, threatened. Hours worked
by and payment made to employees of the Borrower has not been in violation of
the Fair Labor Standards Act or any other applicable law dealing with such
matters. All payments due from the Borrower on account of employee health and
welfare insurance have been paid or accrued as a liability on its books.
4.14 ERISA REQUIREMENT. Except as previously disclosed to Agent in
writing, the Borrower does not have in force any written or oral bonus plan,
stock option plan, employee welfare, pension or profit sharing plan, or any
other employee benefit arrangement or understanding. In addition, the Borrower
and any predecessor of the Borrower is not now or was not formerly during the
five year period immediately preceding the effective date of this Agreement a
participating employer in any multi-employer or "multiple employer" plans within
the meaning of Sections 4001(1)(a)(3), 4063, and 4064 of ERISA. Each employee
benefit plan subject to the requirements of ERISA complies with all of the
requirements of ERISA and those plans which are subject to being "qualified"
under Sections 401(a) and 501(a) of the Internal Revenue Code of 1986, as
amended from time to time, have since their adoption been "qualified" and have
received favorable determination letters from the Internal Revenue Service so
holding. There is no matter which would adversely affect the qualified tax
exempt status of any such trust or plan, and except as previously disclosed to
the Agent, there are no deficiencies or liabilities for any such plan or trust.
No employee benefit plan sponsored by the Borrower has engaged in a non-exempt
"prohibited transaction" as defined in ERISA.
4.15 COMPLIANCE WITH ENVIRONMENTAL REQUIREMENTS. The Borrower warrants
and represents to the Agent and the Banks that to the best of Borrower's
knowledge, the Property described herein is now and at all times hereafter will
continue to be in full compliance with all federal, state and local
environmental laws and regulations as they now exist or are hereafter enacted
and/or amended, including, but not limited to, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986, the Resource Conservation and
Recovery Act of 1976, as amended by the Used Oil Recycling Act of 1980, and the
Hazardous and Solid Waste Amendments of 1984, as amended. The Borrowers shall
indemnify and hold the Agent and the Banks harmless from and against any and all
damages, penalties, fines, claims, liens, suits, liabilities, costs (including
cleanup costs), judgments and expenses (including attorneys', consultants' or
experts' fees and expenses) of every kind and nature suffered by or asserted
against the Agent or the Banks as a direct or indirect result of any warranty or
representation made by the Borrower in this paragraph being false or untrue in
any material respect or any requirement under any law, regulation or ordinance,
whether local, state or federal, which requires the elimination or removal of
any hazardous materials, substances, wastes or other environmentally regulated
substances. The Borrower's obligations hereunder shall not be limited to any
extent by the term of the Indebtedness secured hereby, and, as to any act or
occurrence prior to payment in full and satisfaction of the Indebtedness which
gives rise to liability hereunder, shall continue, survive and remain in full
force and effect notwithstanding payment in full and satisfaction of the
Indebtedness.
4.16 COMPLIANCE WITH REIT REQUIREMENTS. CNLR is in compliance with all
requirements applicable to a Real Estate Investment Trust imposed by the
Internal Revenue Code of 1986, as amended, and all applicable regulations
thereunder, Net I and Net II are in compliance with all requirements applicable
to a Qualified REIT Subsidiary imposed by the Internal Revenue Code of 1986, as
amended, and all applicable regulations thereunder and the Borrower is not aware
of any fact that would negatively impact such qualifications.
4.17 PRINCIPAL OFFICE/CORPORATE NAME. The principal office, chief
executive office, and principal place of business of the Borrower is at ▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. The Borrower maintains its
principal records and books at such address.
4.18 USE OF CREDIT. The Revolving Credit Advances shall be used
exclusively for the purposes specified in Section 2.4 hereof. The Borrower is
not engaged in the business of extending credit for the purpose of purchasing or
carrying "margin stock" (within the meaning of Regulation U, Regulation X or
Regulation G of the Board of Governors of the Federal Reserve System), and no
part of the proceeds of any Advance hereunder will be used to purchase or carry
any "margin stock," to extend credit to others for the purpose of purchasing or
carrying any "margin stock," or for any other purpose which might constitute
this transaction a "purpose credit" within the meaning of Regulation U,
Regulation X, or Regulation G. Neither the Borrower nor any Person acting on
behalf of the Borrower has taken or will take any action which might cause the
Note or any other Loan Documents, including this Agreement, to violate
Regulation U, Regulation X, or Regulation G or any other regulation of the Board
of Governors of the Federal Reserve system or violate Section 8 of the
Securities Exchange Act of 1934 or any rule or regulation thereunder, in each
case as now in effect as the same may hereinafter be in effect. The Borrower
owns no "margin stock" except for that described in the financial statements
referred to in Section 4.4 hereof and, as of the date hereof, the aggregate
value of all "margin stock" owned by the Borrower does not exceed twenty-five
percent (25%) of the value of all of the Borrower's assets. In connection with
the Credit, the Borrower will upon request of the Agent deliver to the Agent a
statement in conformity with the requirements of Federal Reserve Form U-1
referred to in said Regulation.
SECTION 5. CONDITIONS OF LENDING.
The obligation of the Agent and the Banks to establish the Credit or to
permit any borrowing or issue Letters of Credit hereunder is conditioned upon
the performance of all agreements by the Borrowers contained herein, as well as
satisfaction of the following conditions precedent:
5.1 REQUEST FOR BORROWING; SECURITY DOCUMENTS AND INFORMATION. Each
request for a borrowing or the issuance of a Letter of Credit hereunder shall be
evidenced by a Notice of Borrowing in substantially the form of Exhibit "B"
hereto and, if a borrowing is for the purpose of acquiring restaurant or retail
properties pursuant to the Agreement, the Security Documents described in
Section 3.3 above. At least five (5) business days prior to requesting such
Advance, the Borrower must deliver to the Agent all of the information as may be
reasonably requested by the Agent in response to the Borrowers' request for a
borrowing or the issuance of a Letter of Credit. Any Advance of funds by the
Banks without obtaining all such Security Documents and information shall not
constitute a waiver by the Agent or any Bank of its right to receive such
Security Documents and information and a failure of the Borrowers to deliver the
same to the Agent upon demand shall constitute a default hereunder.
5.2 CONTINUING ACCURACY OF REPRESENTATIONS AND WARRANTIES. At the time
of each borrowing or issuance of a Letter of Credit hereunder, the
representations and warranties set forth in this Agreement shall be true,
correct, and complete on and as of the date of such borrowing or Letter of
Credit issuance hereunder with the same effect as though the representations
and warranties had been made on and as of the date of the borrowing or Letter of
Credit issuance.
5.3 NO DEFAULT. At the time of each borrowing or issuance of a Letter
of Credit hereunder, the Borrowers shall be in compliance with all terms and
conditions set forth herein, and no Event of Default, nor any event which upon
notice or lapse of time or both would constitute an Event of Default, shall have
occurred and be continuing at the time of such borrowing or Letter of Credit
issuance.
5.4 LOAN DOCUMENTS. On or prior to the Closing Date, the Agent shall
have received, duly executed this Agreement and the other Loan Documents, all in
form and substance satisfactory to the Agent and counsel for the Agent.
5.5 SUPPORTING DOCUMENTS. On or prior to the Closing Date, the Agent
shall have received the following documents satisfactory in form and substance
to the Agent and counsel for the Agent and, as requested by the Agent, certified
by appropriate corporate or governmental authorities:
(a) a certificate of good standing of each Borrower certified by
the Secretary of State, or other appropriate governmental authority, of
the State of Maryland;
(b) a certificate of qualification of each Borrower to transact
business in the State of Florida certified by the Secretary of State of
the State of Florida;
(c) a copy of the articles of incorporation of each Borrower
certified by the Secretary of State, or other appropriate governmental
authority, of the State of Maryland, accompanied by a certificate from an
appropriate officer of such Borrower that the copy is complete and that
the articles of incorporation have not been amended, annulled, rescinded,
or revoked since the date of the certificate of the Secretary of State or
other appropriate governmental authority;
(d) a copy of the bylaws of each Borrower in effect on the date of
this Agreement, accompanied by a certificate from an appropriate officer
of such Borrower that the copy is true and complete, and that the bylaws
have not been amended, annulled, rescinded, or revoked since the date of
the bylaws or the last amendment reflected in the copy, if any;
(e) a copy of resolutions of the Board of Directors of each
Borrower authorizing the execution, delivery, and performance of the Loan
Documents and the borrowing thereunder, and specifying the officer or
officers of such Borrower authorized to execute the Loan Documents,
accompanied by a certificate from an appropriate officer that the
resolutions are true and complete, were duly adopted at a duly called
meeting in which a quorum was present and acting throughout, or were duly
adopted by written action, and have not been amended, annulled, rescinded,
or revoked in any respect and remain in full force and effect on the date
of the certificate;
(f) an incumbency certificate containing the names, titles, and
genuine signatures of all duly elected officers and directors of each
Borrower as of the date of this Agreement, accompanied by a certificate
from an appropriate officer of such Borrower that the information is true
and complete;
(g) such additional supporting documents as the Agent may request.
5.6 OPINION OF THE BORROWERS' COUNSEL. On or prior to the Closing Date,
and to the extent required by the Agent at the time of any borrowing or Letter
of Credit issuance hereunder, the Agent shall have received the favorable
opinion of counsel for Borrowers, in form and substance satisfactory to the
Agent.
SECTION 6. AFFIRMATIVE COVENANTS.
The Borrowers covenant and agree that, from the date of this Agreement
until payment in full and termination of the Credit and expiration of all
Letters of Credit issued thereunder, unless the Agent shall otherwise consent in
writing, the Borrowers will fully comply with the following provisions:
6.1 FINANCIAL REPORTS AND OTHER DATA.
(a) Quarterly Reports. The Borrowers shall deliver to the Agent
and the Banks within sixty (60) days after the end of each of the
Borrower's fiscal quarters:
(i) The Borrowers' Profit and Loss Statement and Cash Flow
Statement for such quarter and the Borrower's Balance Sheet as at
the last day of such quarter, all in reasonable detail and
satisfactory in scope to the Agent and certified by each Borrower's
chief financial officer as to the fairness and accuracy of such
financial statements and that the same have been prepared in
accordance with Generally Accepted Accounting Principles applied on
a Consistent Basis; and
(ii) a Quarterly Advance Compliance Certificate including a
listing of each Borrower's properties and information on leases,
stating that each Borrower is in compliance with all covenants made
pursuant to the Loan Documents and including a schedule of
computations in reasonable detail demonstrating compliance with the
financial covenants contained in Subsection 6.2 of this Agreement.
Such certificate shall be executed by the chief financial officer of
each Borrower stating that to the best of the officer's knowledge,
such Borrower has kept, observed, performed, and fulfilled each and
every agreement binding on it contained in the Loan Documents, and
is not at the time in default of the keeping, observance,
performance, or fulfillment of any of the terms, provisions, and
conditions thereof, and that none of the Events of Default or events
which upon notice or the lapse of time or both would constitute
Events of Default has occurred (or specifying all such defaults and
events of which officer may have knowledge and what actions such
Borrower is taking or proposes to take with respect thereto).
(b) Annual Reports. The Borrowers shall annually furnish to the
Agent and the Banks within ninety (90) days after the end of each fiscal
year financial statements of the Borrowers which must be acceptable to the
Agent in the Agent's sole discretion. Such statements shall include, but
not be limited to, a statement of profit and loss, and reconciliation of
surplus statement for such year, and a balance sheet as of the end of such
year, all in reasonable detail and satisfactory in scope to the Agent.
All financial statements shall be prepared in accordance with Generally
Accepted Accounting Principles, applied on a Consistent Basis, accompanied
by an unqualified opinion of independent certified public accountants of
recognized national standing selected by the Borrowers and satisfactory to
the Agent. Together with each delivery of financial statements as
required by this subsection 6.1(b), the Borrowers shall deliver to the
Agent a certificate of the independent certified accountants stating that
in making the examination necessary to said certification of the financial
statements, they obtained no knowledge of any condition or event
pertaining to financial or accounting matters, of the Borrowers that
constitutes an Event of Default or event which after notice by the Agent
or lapse of time, or both, would constitute an Event of Default; or if the
accountants have obtained knowledge of any Event of Default or other such
event, a statement specifying the nature and period of existence thereof.
In addition, such accountants' certificate shall state that with respect
to the fulfillment of any of the terms, covenants, provisions, or
conditions of the Loan Documents, other than those relating to financial
or accounting matters, they have obtained no knowledge of any default or
Event of Default, or if the accountants have obtained knowledge of any
such default or Event of Default they shall make disclosure thereof, but
the accountants shall not be liable to the Agent or the Banks for any
failure to obtain knowledge of any default or Event of Default referred to
in this sentence.
(c) Additional Data. With reasonable promptness, the Borrowers
will deliver such additional information respecting the business,
operations, and financial condition of any Borrower as the Agent or any
Bank may from time to time reasonably request, including, without
limitation, (i) any and all correspondence with any auditors and/or
regulatory agencies which request changes in or require alterations in the
procedures used in administering or reporting in any Borrower's
operations, (ii) any and all financial statements, reports, notices, and
proxy statements sent or made available by any Borrower to its security
holders, all regular and periodic reports, and all registration statements
and prospectuses filed by any Borrower with the Securities and Exchange
Commission or any governmental authority succeeding to any of its
functions, and (iii) all press releases and other statements made
available generally by any Borrower to the public concerning material
developments in the business of such Borrower.
(d) Sharing of Financial Information. The Agent and the Banks are
hereby authorized to deliver a copy of any financial statements or any
other information relating to the business operations or financial
condition of any Borrower which may be furnished to them or come to their
attention pursuant to the Loan Documents or otherwise, to any regulatory
body or agency having jurisdiction over Agent or any Bank or to any Person
which shall, or shall have the right or obligation to, succeed to all or
any part of the Agent's or any Bank's interest in the Loan Documents.
6.2 FINANCIAL COVENANTS OF THE BORROWERS. During the term of the
Credit, the Borrowers will maintain the following financial covenants and such
computations shall be made on a consolidated basis in accordance with Generally
Accepted Accounting Principles applied on a Consistent Basis:
(a) the ratio of Total Liabilities to Tangible Net Worth of the
Borrower shall not be more than .85 to 1 at any time.
(b) the ratio of Funded Debt to the Banks to Capital, but
excluding the book value and mortgage debt for those properties to be
mortgaged by CNLR to Principal Mutual Life Insurance Company, or an
affiliate thereof, as provided in this Agreement, at the end of any fiscal
quarter shall not be more than .40 to 1.
(c) the ratio of Funded Debt to Capital at the end of any fiscal
quarter shall not be more than .46 to 1.
(d) the Cash Flow Coverage Ratio defined as Funds from Operations
plus Interest divided by Interest, shall not be less than 2.5 to 1 at any
time.
(e) the Debt Service Coverage Ratio shall not be less than 1.8 to
1. This ratio shall be calculated at the end of each quarter on a rolling
twelve month basis beginning September 30, 1994.
6.3 PAYMENT AND PERFORMANCE OF THE BORROWERS OBLIGATIONS. The Borrowers
will make full and timely payment of the principal of and interest on the
indebtedness owed hereunder. The Borrowers will duly comply with all the terms
and covenants contained in the Loan Documents.
6.4 DEPOSITORY ACCOUNT. Until the Note and the other Loan Documents are
paid in full, each Borrower shall maintain a depository account with the Agent.
6.5 CONDUCT OF BUSINESS; MAINTENANCE OF EXISTENCE. Each Borrower will
do or cause to be done all things necessary to preserve and to keep in full
force and effect its corporate existence and rights and its franchises, trade
names, patents, trademarks, and permits which are necessary for the continuance
of its business; maintain management satisfactory to Required Banks; and
continue to engage principally in the business currently operated by such
Borrower.
6.6 RIGHT OF INSPECTION; DISCUSSIONS. Each Borrower will permit any
person designated by the Agent or any Bank, at such Borrower's expense, to visit
and inspect any of the property, books, records, papers, and financial reports
of such Borrower, including the making of any copies thereof and abstracts
therefrom, and to discuss its affairs, finances, and accounts with its principal
officers, all at such reasonable times and as often as the Agent or any Bank may
reasonably request. Each Borrower will also permit the Agent or any Bank, or
its designated representative, to audit or appraise any of its assets or
financial and business records. Without limiting the foregoing in any way, each
Borrower also agrees to allow the Agent and any Bank or certified public
accountants satisfactory to the Agent or such Bank to review such Borrower's
financial statements, books, and records regarding depreciation and reserves
accounting. Each Borrower further agrees to permit the Agent and the Banks to
review each registration statement and any other offering documents (including
any amendments thereto) (collectively the "Offering Documents") prepared by such
Borrower or at the direction of such Borrower for the purpose of effecting an
offering of an equity interest in such Borrower. The Agent and each Bank shall
have the right to approve any reference to the Agent or such Bank and to the
Credit in such Offering Documents.
6.7 NOTICES. Each Borrower will promptly give notice to the Agent and
the Banks of:
(a) the occurrence of any default or Event of Default (or event
which would constitute a default or Event of Default but for the
requirement that notice be given or time elapse or both) hereunder or
under any other obligation of any Borrower, in which case such notice
shall specify the nature thereof, the period of existence thereof, and the
action that the Borrowers propose to take with respect thereto;
(b) the occurrence of any material casualty to any property of any
Borrower or any other force majeure (including, without limitation, any
strike or other labor disturbance) materially affecting the operation or
value of any Borrower (specifying whether or not such casualty or force
majeure is covered by insurance); and
(c) the occurrence of any event of default pursuant to any lease
pledged as Collateral hereunder, or the commencement of any material
litigation, dispute, investigation or proceeding that may involve a claim
for damages, injunctive relief, enforcement of other relief pending, being
instituted, or threatened by, against or involving a lessee under a lease
pledged as Collateral hereunder or any filing or commencement by or
against any such lessee of a petition, case, proceeding or other action
seeking reorganization, arrangement or readjustment of its debt, or any
relief under any existing or future law relating to bankruptcy,
insolvency, reorganization or relief of debtors, or any adverse change
which might impair the conduct of such lessee's business or might
materially affect financially or otherwise its business, operations,
assets, properties, prospects or condition of which any Borrower has
notice or knowledge.
(d) the commencement or any material change in the nature or
status of any litigation, dispute, investigation, or proceeding that may
involve a claim for damages, injunctive relief, enforcement, or other
relief pending, being instituted, or threatened by, against or involving
any Borrower, or any attachment, levy, execution, or other process being
instituted by or against any assets of any Borrower, or any other adverse
change which might impair the conduct of the business of the Borrowers or
might materially affect financially or otherwise the business, operations,
assets, properties, prospects, or condition of the Borrowers.
6.8 PAYMENT OF TAXES; LIENS. Each Borrower will promptly pay, or cause
to be paid, all taxes, assessments and other governmental charges which may
lawfully be levied or assessed (i) upon the income or profits of such Borrower,
(ii) upon any property, real, personal or mixed, belonging to such Borrower, or
upon any part thereof, or (iii) by reason of employee benefit plans sponsored by
such Borrower, and also any lawful claims for labor, material, and supplies
which, if unpaid, might become a lien or charge against any such property;
provided, however, no Borrower shall be required to pay any such tax,
assessment, charge, levy, or claim so long as the validity thereof shall be
actively contested in good faith by proper proceedings; but provided further
that any such tax, assessment, charge, levy, or claim shall be paid forthwith
upon the commencement of proceedings to foreclose any lien securing the same.
6.9 MAINTENANCE OF PROPERTY, LEASES. Each Borrower will maintain its
property in good condition and repair and, from time to time, make all necessary
and proper repairs, renewals, replacements, additions and improvements thereto,
so that any business carried on may be properly and advantageously conducted at
all times in accordance with prudent business management. Each Borrower will
maintain all leases on its property and ground leases to which it is a party in
good standing, will perform all of its obligations thereunder when due, and the
Borrowers, in the aggregate, will not amend, alter, modify, or change the terms
of more than ten percent (10%) of the total number of such leases, or terminate,
cancel, or permit any surrender of more than ten percent (10%) of the total
number of such leases (other than because the lease term has expired) without
the advance written approval of the Agent. To the extent that any leases have
terminated by their own terms or because of defaults of the tenants, each
Borrower will replace such leases with leases containing comparable provisions
and with tenants of similar quality, credit and otherwise.
6.10 ERISA BENEFIT PLANS. Each Borrower will comply with all
requirements of ERISA applicable to it and will not materially increase its
liabilities under or violate the terms of any present or future benefit plans
maintained by it without the prior approval of the Agent. Each Borrower will
furnish to the Agent as soon as possible and in any event within 10 days after
the Borrower or a duly appointed administrator of a plan (as defined in ERISA)
knows or has reason to know that any reportable event, funding deficiency, or
prohibited transaction (as defined in ERISA) with respect to any plan has
occurred, a statement of the chief financial officer of such Borrower describing
in reasonable detail such reportable event, funding deficiency, or prohibited
transaction and any action which such Borrower proposes to take with respect
thereof, together with a copy of the notice of such event given to the Pension
Benefit Guaranty Corporation or the Internal Revenue Service or a statement that
said notice will be filed with the annual report of the United States Department
of Labor with respect to such plan if such filing has been authorized.
6.11 INSURANCE OF PROPERTY. Each Borrower will keep its business and its
property insured at all times for full replacement value or otherwise in amounts
acceptable to Agent by commercially reasonable insurance companies against the
risks for which provision for such insurance is usually made by other Persons
engaged in a similar business similarly situated (including without limitation
insurance for fire and other hazards and insurance against liability on account
of damage to persons or property and insurance under all applicable workmen's
compensation laws) and to the same extent thereto and carry such other types and
amounts of insurance as are usually carried by Persons engaged in the same or a
similar business similarly situated, and upon request deliver to the Agent, on
behalf of the Banks, a certificate from the insurer setting forth the nature of
the risks covered by such insurance, the amount carried with respect to each
risk, and the name of the insurer. Each Borrower hereby agrees that any
proceeds from such insurance coverage shall be applied to either (i) repair or
rebuild the property for which such proceeds are being received, (ii) acquire a
substantially equivalent property with a substantially equivalent lease stream
of similar credit quality or (iii) repay any borrowings hereunder.
6.12 TRUE BOOKS. Each Borrower will keep proper and true books of record
and account, reasonably satisfactory to the Agent, in which full, true, and
correct entries will be made of all of its dealings and transactions, and
establish on its books such reserves as may be required by Generally Accepted
Accounting Principles with respect to all taxes, assessments, charges, levies,
and claims referred to in Section 6.8 hereof, and with respect to its business
in general, and will include such reserves in any interim as well as year-end
financial statements.
6.13 OBSERVANCE OF LAWS. Each Borrower will conform to and duly observe
all laws, regulations, and other valid requirements of any Governmental
Authority with respect to the conduct of its business, including but not limited
to, applicable ERISA, environmental and transportation laws.
6.14 FURTHER ASSURANCES. At its cost and expense, upon request of the
Agent, each Borrower will duly execute and deliver or cause to be duly executed
and delivered to the Agent, such further instruments or documents and do and
cause to be done such further acts as may be reasonably necessary or proper in
the opinion of the Agent to carry out more effectively the provisions and
purposes of this Agreement.
6.15 CHANGE OF NAME, PRINCIPAL PLACE OF BUSINESS, OFFICE, OR THE AGENT.
Each Borrower will notify the Agent of any change in the name of such Borrower,
the principal place of business of such Borrower, the office where the books and
records of such Borrower are kept, or any change in the registered agent of such
Borrower for the purposes of service of process. No Borrower will change the
chief executive office of such Borrower from Orange County, Florida, without
first notifying the Agent.
6.16 STATUS. CNLR shall at all times comply with all requirements of
applicable laws and regulations necessary to maintain REIT Status. Net I and
Net II shall at all times comply with all requirements of applicable laws and
regulations necessary to maintain Qualified REIT Subsidiary Status.
6.17 SYNDICATION OF CREDIT. Each Borrower agrees to cooperate with the
Agent in connection with its intended further syndication of the Credit, such
cooperation to include, but not be limited to, attendance by management
personnel of the Borrowers at meetings arranged by the Agent with
representatives of potentially participating commercial lending institutions,
provision of information regarding the Borrower's business operations and
financial condition, and response to questions and inquiries regarding the
Borrowers.
6.18 USE OF PROCEEDS FROM MORTGAGE LOANS. Each Borrower agrees to use
all net proceeds from any mortgage loans hereafter secured from Principal Mutual
Life Insurance Company, or an affiliate thereof, pursuant to the release of
certain properties by Banks pursuant to subsection 3.4(b) hereof to prepay
outstanding Advances hereunder.
SECTION 7. NEGATIVE COVENANTS.
The Borrowers covenant and agree that from the date of this Agreement
until payment in full and termination of the Credit and expiration of all
Letters of Credit issued thereunder, the Borrowers will fully comply with the
following provisions:
7.1 OTHER INDEBTEDNESS. No Borrower will, directly or indirectly,
create, incur, assume or permit to exist any indebtedness for borrowed money
without the prior written consent of Required Banks, except (a) pursuant to the
Loan Documents, (b) then existing debt assumed in connection with the
acquisition of properties encumbered by existing mortgages, in an aggregate
amount not to exceed Five Million Dollars ($5,000,000.00) outstanding at any
time, (c) additional debt in the form of a private placement or term
indebtedness (the "Term Credit"), so long as the Borrowers remains in compliance
with all terms and conditions of this Agreement at all times, including, but not
limited to, the financial covenants contained in Subsection 6.2 hereof, and (d)
indebtedness to Principal Mutual Life Insurance Company, or an affiliate
thereof, in an aggregate amount of not more than Fifty-Two Million Six Hundred
Thousand and No/100 Dollars ($52,600,000.00) secured by mortgage loans on the
properties to be released by Banks pursuant to subsection 3.4(b) hereof and
listed on Schedule I hereto.
7.2 LIMITATIONS ON MORTGAGES, LIENS, ETC. No Borrowers will, directly
or indirectly, create, incur, assume, or suffer or permit to exist any security
interest, pledge, lien, or other charge or encumbrance (including the lien or
retained security title of a conditional vendor or lessor) upon or with respect
to any property of the Borrowers without the prior written consent of all of the
Banks except (a) pursuant to the Loan Documents, (b) except workmen's,
materialmen's, or other like liens arising in the ordinary course of business in
respect of obligations which are not due or which are being contested in good
faith, (c) liens for taxes not yet due or being contested in good faith by
appropriate proceedings, (d) other similar encumbrances incurred in the ordinary
course of business, and not interfering with the ordinary course of the
business, (e) then existing mortgages securing indebtedness permitted under
Subsection 7.1(b); (f) liens or security interests in the Collateral (but no
other property of the Borrowers) securing indebtedness permitted under
Subsection 7.1(c); provided however, that such liens or security interests shall
be of equal priority and pari passu with the liens and security interests of the
Banks hereunder pursuant to the provisions of an intercreditor agreement or
similar arrangement in form and substance satisfactory to the Agent and all of
the Banks in their reasonable discretion and (g) mortgages on those properties
listed on Schedule I hereto securing indebtedness to Principal Mutual Life
Insurance Company, or an affiliate thereof, permitted under Subsection 7.1(d)
hereof.
7.3 NO GUARANTIES. No Borrower will, directly or indirectly, guarantee,
assume, endorse, become a surety or accommodation party for, or otherwise in any
way extend credit or become responsible for or remain liable or contingently
liable in connection with any indebtedness or other obligations of any other
Person or entity without the prior written consent of Required Banks except
guaranties and endorsements made in connection with the deposit of negotiable
instruments and other items for collection or credit in the ordinary course of
business and except in the ordinary course of acquiring properties so long as no
material effect on the operation or value of Borrowers results therefrom.
7.4 MERGER, SALE OF ASSETS, DISSOLUTION, ETC. No Borrower will,
directly or indirectly, (a) enter into any transaction of merger or
consolidation; or (b) allow any change in control of any Borrower; or (c)
transfer, sell, assign, lease, or otherwise dispose of all or a substantial part
of its properties or assets; or (d) transfer, sell, assign, lease, convey, or
otherwise dispose of any of its real property (including but not limited to the
property giving rise to the Collateral), except that a Borrower may, so long as
there exists no Event of Default or circumstance which with the giving of notice
or passage of time would become an Event of Default, sell real property in the
ordinary course of business to bona fide unrelated third parties, which either
is replaced with substantially equivalent properties with substantially
equivalent lease streams of similar credit quality, or for which the sale is a
cash sale and the proceeds of which, net only of reasonable seller's closing
costs, are applied by the Borrowers as a prepayment of the Revolving Credit
Facility; or (e) change the nature of its business; or (f) invest in, transfer
any assets to, or do business through any subsidiary except wholly-owned
subsidiaries engaged in the same business as the Borrower which agree to become
borrowers hereunder upon formation; or (g) wind up, liquidate, or dissolve
itself or its business; or (h) agree to any of the foregoing.
7.5 LIMITATIONS ON LOANS, ADVANCES, AND INVESTMENTS. No Borrower will,
directly or indirectly, make or have outstanding a loan or advance to or an
investment in, all or a substantial part of the assets or properties of, or own
or acquire stock or other securities of, any Person, except (a) stock or other
securities received in settlement of a debt that was created in the ordinary
course of business, (b) travel advances in the ordinary course of business to
its officers and employees, (c) readily marketable securities issued by the
United States of America, and (d) certificates of deposit or repurchase
agreements of a Bank or of any other financial institution of comparable
standing; (e) investments in wholly owned subsidiaries engaged in the same
business as the Borrower which agree to become borrowers hereunder upon
formation; or (f) notes and mortgages in favor of the Borrower which secure the
obligation of seller under a property acquisition contract to refund an ▇▇▇▇▇▇▇
money deposit or portion thereof.
7.6 REGULATION U. No Borrower will permit any part of the proceeds of
the Credit to be used to purchase or carry or to reduce or retire any loan
incurred to purchase or carry, any margin stock (within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System) or to
extend credit to others for the purpose of purchasing or carrying any such
margin stock, or to be used for any other purpose which violates, or which would
be inconsistent with, the provisions of Regulation U or other applicable
regulation. Each Borrower covenants that it is not engaged and will not become
engaged as one of its principal or important activities in extending credit for
the purpose of purchasing or carrying such margin stock. If requested by the
Agent, each Borrower will furnish to the Agent in connection with any loan or
loans hereunder, a statement in conformity with the requirements of Federal
Reserve Form U-1 referred to in said Regulation. In addition, each Borrower
covenants that no part of the proceeds of the Credit will be used for the
purchase of commodity future contracts (or margins therefor for short sales) for
any commodity not required for the normal raw material inventory of such
Borrower.
7.7 INSIDER TRANSACTIONS. No Borrower will, directly or indirectly,
purchase, acquire or lease any property or asset from, or sell, dispose of or
lease any property or assets to, or otherwise deal with, in the ordinary course
of business or otherwise, (i) any stockholder or (ii) any other related entity,
except upon terms and conditions not less favorable to such Borrower than if no
such relationship existed and upon approval thereof by the independent members
of such Borrower's board of directors, or except for transactions of which the
Agent has been notified in writing by such Borrower and Required Banks have
consented thereto, which consent will not be unreasonably withheld.
7.8 CHANGES IN GOVERNING DOCUMENTS, ACCOUNTING METHODS, FISCAL YEAR. No
Borrower will amend in any respect its articles of incorporation or bylaws from
that in existence on the date of this Agreement or change its accounting methods
or practices, its depreciation or amortization policy or rates, or its fiscal
year end from that in existence as of the date of the financial statements
provided to the Agent pursuant to Section 6.1 hereof, except as required to
comply with law or with Generally Accepted Accounting Principles or except as
consented to in writing by the Agent, which consent shall not be unreasonably
withheld.
7.9 MANAGEMENT. No Borrower will directly or indirectly permit a
material change in the senior management of such Borrower. For purposes of this
Section, senior management of each of the Borrowers shall be deemed to include
the current officers of CNL Realty Advisors, Inc., a Florida corporation.
SECTION 8. EVENTS OF DEFAULT.
It shall be an Event of Default under the Credit if:
8.1 PAYMENT OF OBLIGATIONS TO THE BANKS. Any Borrower fails to make
payment of any principal, interest, or other amount due on any indebtedness owed
the Agent or the Banks hereunder, or fails to make any other payment to the
Agent or the Banks as contemplated hereunder either by the terms hereof or
otherwise.
8.2 REPRESENTATION OR WARRANTY. Any representation or warranty made or
deemed made by any Borrower herein or in any writing furnished in connection
with or pursuant to the loan application and loan commitment for the Credit or
in connection with or pursuant to the Loan Documents shall be false in any
material adverse respect on the date when made or when deemed made.
8.3 COVENANTS. Any Borrower defaults in the performance or observance
of or breaches any agreement, covenant, term, or condition binding on it
contained in the Loan Documents.
8.4 ANY BORROWER'S LIQUIDATION; DISSOLUTION; BANKRUPTCY; ETC. Any
liquidation or dissolution of any Borrower, suspension of the business of any
Borrower, or the filing or commencement by any Borrower of a voluntary petition,
case, proceeding, or other action seeking reorganization, arrangement,
readjustment of its debts; or commencement of an involuntary petition, case,
proceeding or other action against Borrowers seeking reorganization, arrangement
or readjustment of its debts, which is not vacated, discharged, stayed, bonded
or dismissed within 60 days of its commencement; or the entry of an order for
relief under any existing or future law of any jurisdiction, domestic or
foreign, state or federal, relating to bankruptcy, insolvency, reorganization or
relief of debtors, or any other action of any Borrower indicating its consent
to, approval of, or acquiescence in, any such petition, case, proceeding, or
other action seeking to have an order for relief entered with respect to it or
its debts; the application by any Borrower for, or the appointment, by consent
or acquiescence of, a receiver, trustee, custodian, or other similar official
for any Borrower or for all or a substantial part of its property; the making by
any Borrower of an assignment for the benefit of creditors; or the inability of
any Borrower or the admission by any Borrower in writing of its inability to pay
its debts as they mature.
8.5 ORDER OF DISSOLUTION. Any order is entered in any proceedings
against any Borrower decreeing the dissolution or split-up of such Borrower, and
such order remains in effect for more than sixty (60) days.
8.6 REPORTS AND CERTIFICATES. Any report, certificate, financial
statement, or other instrument delivered to the Agent or the Banks by any
Borrower is at any time false or misleading in any material adverse respect.
8.7 JUDGMENTS. The rendition of a final judgment against any Borrower
for the payment of damages or money in excess of Two Hundred Fifty Thousand
Dollars ($250,000.00) if the same is not discharged, bonded off or transferred
to other security or if a writ of execution or similar process is issued with
respect thereto and is not stayed within the time allowed by law for filing
notice of appeal of the final judgment.
8.8 LIENS IMPOSED BY LAW. The violation of any law or any act or
omission by any Borrower that results in the imposition of a lien by operation
of law on any of its property, if the lien is not discharged, bonded off or
transferred to other security within sixty (60) days after it has attached and
if the lien relates to a claim for the payment of damages or money in excess of
Two Hundred Fifty Thousand Dollars ($250,000.00).
8.9 CORPORATE EXISTENCE. Any act or omission (formal or informal) of
any Borrower or its officers, directors, shareholders, or partners leading to,
or resulting in, the termination, invalidation (partial or total), revocation,
suspension, interruption, or unenforceability of its existence, or the transfer
or disposition (whether by sale, lease, or otherwise) to any Person of all or a
substantial part of its property.
8.10 INVALIDITY OF SECURITY INTEREST AND LIENS. For any reason after the
execution and delivery thereof, any document delivered pursuant hereto that
creates, or was intended to create, a security interest or to provide collateral
security for indebtedness created hereunder ceases to be in full force and
effect or the liens intended to be created thereby cease to be or are not valid
and perfected first priority liens contemplated thereby and the failure by any
Borrower to cure such failure within a period of thirty (30) days.
THEN (i) upon the occurrence of any Event of Default described in
the foregoing Subsections 8.4 or 8.5, the unpaid principal amount of and accrued
interest on the Credit and all other obligations under the Loan Documents shall
automatically become immediately due and payable, without presentment, demand,
protest, or other requirement of any kind, all of which are expressly waived by
each Borrower and the commitments of each Bank to make Advances hereunder and
the obligation of the Issuing Bank to issue Letters of Credit hereunder shall
thereupon terminate; and (ii) upon the occurrence and during the continuance of
any other Event of Default: (a) the Agent shall, upon the written request or
with the written consent of the Required Banks take any one or more of the
following actions: (1) declare all or any portion of the amounts described in
(i) to be, and the same shall forthwith become, immediately due and payable,
without presentment, demand, protest, or other requirement of any kind, all of
which are expressly waived by each Borrower, and (2) declare all commitments to
make Advances hereunder and the obligation of the Issuing Bank to issue Letters
of Credit hereunder to be terminated, and (b) any Bank may give notice to the
Borrowers and the Agent terminating its commitment to make further Advances
hereunder. In any case the Borrowers shall be required to pay to the Agent a
sum equal to the maximum amount available under any Letters of Credit, which sum
the Agent will hold for reimbursement of any amounts drawn under Letters of
Credit and the Issuing Bank may terminate any Letters of Credit providing for
such termination by sending a notice of termination as provided therein. The
Agent may immediately proceed to do all other things provided for by law or the
Loan Documents to enforce the rights of the Agent, the Issuing Bank, and the
Banks hereunder and to collect all amounts owing to the Agent, the Issuing Bank,
and the Banks by the Borrowers. Without limiting the foregoing in any way, upon
any Event of Default, the Agent and the Banks shall be entitled to the
appointment of a receiver to take charge of the Collateral and each Borrower
hereby waives any objection to the appointment of a receiver. No right, power,
or remedy conferred upon the Agent, the Issuing Bank, or the Banks by the Loan
Documents shall be exclusive of any other right, power, or remedy referred to
therein or now or hereafter available at law or in equity. Notwithstanding the
foregoing, an Event of Default under subsection 8.3, 8.6, 8.7 or 8.8 above shall
not be deemed to have occurred if the matter described therein is cured within
thirty (30) days after written notice thereof has been given by the Agent to the
Borrowers, an Event of Default under subsections 8.1 or 8.2 above shall not be
deemed to have occurred if the matter described therein is cured within five (5)
days after written notice thereof has been given by the Agent to the Borrowers.
SECTION 9. THE AGENT
9.1 APPOINTMENT, AUTHORIZATION, AND ACTION.
(a) Each Bank hereby irrevocably appoints and authorizes the Agent
to act as its agent hereunder and take such action on its behalf and to exercise
such powers and discretion under this Agreement and the other Loan Documents as
are delegated to the Agent by the terms hereof, together with such powers as are
reasonably incidental thereto. The relationship between the Agent and each Bank
is and shall be that of agent and principal only and nothing herein or in any of
the other Loan Documents shall be construed to constitute the Agent a trustee
for any Bank or to establish a fiduciary relationship with any Bank or impose on
the Agent any duties, responsibilities, or obligations other than those
expressly set forth in this Agreement or the other Loan Documents.
(b) The Agent shall be entitled to use its discretion with respect
to exercising or refraining from exercising any rights or taking any actions
which may be vested in it or which it may be able to take under or in respect of
this Agreement and the other Loan Documents, unless this Agreement expressly
otherwise provides or unless the Agent shall have been instructed by the
Required Banks to exercise or refrain from exercising such rights or taking such
actions (in which case it shall be required to so act or refrain from acting
pursuant to the directions of the Required Banks); provided, however, that the
Agent shall not be required to take any action or refrain from acting in any
manner which in its judgment exposes the Agent to personal liability or which is
contrary to this Agreement or applicable law. The Agent agrees to give to each
Bank prompt notice of each notice given to it by any Borrower pursuant to the
terms of this Agreement.
9.2 DELEGATION OF DUTIES. The Agent may execute any of its duties under
this Agreement and the other Loan 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 Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by the
Agent with reasonable care.
9.3 EXCULPATORY PROVISIONS. Neither the Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact, subsidiaries or affiliates
shall be (a) liable for any action lawfully taken or omitted to be taken by it
or such Person under or in connection with this Agreement or the other Loan
Documents (except for actions occasioned solely by its or such Person's own bad
faith, gross negligence or willful misconduct), or (b) responsible in any manner
to any of the Banks for any recitals, statements, representations, or warranties
made by any Borrower or any officer thereof contained in this Agreement or the
other Loan Documents or in any certificate, report, statement, or other document
referred to or provided for in, or received by the Agent under or in connection
with, this Agreement or the other Loan Documents or for the value, validity,
effectiveness, genuineness, enforceability, or sufficiency of this Agreement or
the other Loan Documents or for any failure of any Borrower to perform its
obligations hereunder or thereunder. The Agent shall not be under any
obligation to any Bank to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this
Agreement, or to inspect the properties, books, or records of any Borrower.
9.4 RELIANCE BY THE AGENT. The 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 Borrower), independent
accountants, and other experts selected by the Agent. The Agent may deem and
treat the payee of any Note as the owner thereof for all purposes unless such
Note shall have been transferred in accordance with Section 11.4 hereof. The
Agent shall be fully justified in failing or refusing to take any action under
this Agreement and the other Loan Documents unless it shall first receive such
advice or concurrence of the Required Banks (or, when expressly required hereby
or by the relevant other Loan Document, all the Banks) as it deems appropriate
and it shall first be indemnified to its satisfaction by the Banks against any
and all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action except for liabilities arising solely from
its own gross negligence or willful misconduct. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, under this Agreement
and the other Loan Documents in accordance with a request of the Required Banks
(or, when expressly required hereby, all the Banks), and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
Banks and all future holders of the Note.
9.5 AGENT AND AFFILIATES. With respect to its Revolving Credit
Commitment and the Advances made by it, the Agent shall have the same rights and
powers under the Loan Documents as any other Bank and may exercise the same as
though it were not the Agent; and the term "Bank" or "Banks" shall, unless
otherwise indicated, include the Agent in its individual capacity. The Agent
and its affiliates may (without having to account therefor to any Bank) accept
deposits from, lend money to, act as trustee under indentures of, accept
investment banking engagements from, and generally engage in any kind of
business with, any Borrower, and any Person who may do business with or own
securities of any Borrower all as if it were not the Agent. The Agent and its
affiliates may accept fees and other consideration from any Borrower for
services in connection with this Agreement or otherwise without having to
account for the same to the Banks.
9.6 NOTICE OF DEFAULT. The Agent shall not be deemed to have knowledge
or notice of the occurrence of any Event of Default hereunder unless it has
received written notice or telephonic notice confirmed immediately in writing
from a Bank or any Borrower referring to this Agreement, describing such Event
of Default and stating that such notice is a "notice of default". In the event
that the Agent receives such a notice, it shall promptly give notice thereof to
the Banks. The Agent shall take such action with respect to such Event of
Default as shall be reasonably directed by the Required Banks; provided that
unless and until the Agent shall have received such directions, the Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Event of Default as it shall deem advisable in the
best interests of the Banks.
9.7 NON-RELIANCE ON THE AGENT AND OTHER LENDERS. Each Bank expressly
acknowledges that neither the Agent nor any of its respective officers,
directors, employees, agents, attorneys-in-fact, subsidiaries or affiliates has
made any representations or warranties to it and that no act by the Agent
hereinafter taken, including any review of the affairs of any Borrower, shall be
deemed to constitute any representation or warranty by the Agent to any Bank.
Each Bank represents to the Agent that it has, independently and without
reliance upon the Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrowers, and made its own decision to
enter into this Agreement. Each Bank also represents that it will,
independently and without reliance upon the Agent or any other Bank, and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals, and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Borrowers. Except for notices, reports, and other documents expressly required
to be furnished to the Banks by the Agent hereunder or by the other Loan
Documents, the Agent shall not have any duty or responsibility to provide any
bank with any credit or other information concerning the business, operations,
property, financial, and other condition or creditworthiness of the Borrowers
which may come into the possession of the Agent or any of its respective
officers, directors, employees, agents, attorneys-in-fact, subsidiaries, or
affiliates.
9.8 ENFORCEMENT BY THE AGENT. All rights of action under this
Agreement and the other Loan Documents and all rights to any Collateral
hereunder may be enforced by the Agent and any suit or proceeding instituted by
the Agent in furtherance of such enforcement may be brought in its name as the
Agent without the necessity of joining any Banks as plaintiffs or defendants,
and the recovery of any judgment shall be for the benefit of the Banks, subject
to the expenses of the Agent. Unless otherwise permitted by the Required Banks,
no Bank (other than the Agent) shall attempt to enforce any rights of action
under this Agreement and the other Loan Documents or the rights to any
Collateral.
9.9 INDEMNIFICATION. The Banks agree to indemnify the Agent in its
capacity as such and to the extent not promptly reimbursed by the Borrowers and
without limiting the obligations of the Borrowers to do so, ratably according to
the respective principal amounts of the Advances then owing to each of them (or
if no Advances are at the time outstanding, ratably according to the respective
amounts of their Revolving Credit Commitments), from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses, or disbursements or any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against the Agent in any way relating to or
arising out of this Agreement or any other Loan Documents or the transactions
contemplated thereby, or any action taken or omitted by the Agent in connection
therewith (including, without limitation, the costs and expenses payable by the
Borrowers under Subsection 11.2); provided, however, that no Bank shall be
liable for any of the foregoing to the extent they arise from the Agent's gross
negligence, bad faith or willful misconduct. Without limiting the foregoing,
each Bank agrees to reimburse the Agent promptly upon demand for such Bank's
ratable share of any costs and expenses payable by the Borrowers under Section
11.2, to the extent that the Agent is not promptly reimbursed for such costs and
expenses by the Borrowers. The agreements contained in this Subsection shall
survive the repayment of the Advances and termination of the facilities
hereunder.
9.10 FAILURE TO ACT. Except for actions expressly required of the Agent
hereunder and under the other Loan Documents, the Agent shall in all cases be
fully justified in failing or refusing to act hereunder and thereunder unless it
shall receive further assurances to its satisfaction from the Banks of their
indemnification obligations hereunder against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take any such
action.
9.11 SUCCESSOR AGENT. Subject to the appointment and acceptance of a
successor as provided below, the Agent may resign at any time by giving written
notice thereof to the Banks and the Borrowers. Upon any such resignation and
after consultation with the Borrowers, the Required Banks shall have the right
to appoint a successor Agent. If no successor Agent shall have been so
appointed by the Required Banks and shall have accepted such appointment, within
30 days after the retiring Agent's giving of notice of resignation, then the
retiring Agent may, on behalf of the Banks, and after consultation with the
Borrowers, appoint a successor Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any State thereof and
having a combined capital and surplus of at least $500,000,000. Upon the
acceptance of any appointment as the Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, discretion, privileges, and duties of the retiring Agent, and
the retiring Agent shall be discharged from its duties and obligations under the
Loan Documents. After any retiring Agent's resignation hereunder as the Agent,
the provisions of this Section shall inure to its benefit as to any actions
taken or omitted to be taken by its while it was the Agent under this Agreement.
SECTION 10. INDEMNIFICATION BY BORROWERS.
The Borrowers hereby jointly and severally agree to indemnify the Agent,
the Issuing Bank, and each Bank and their respective officers, directors,
employees, and agents (individually an "Indemnified Party" and collectively the
"Indemnified Parties") against and agrees to hold the Indemnified Parties
harmless from, any and all liabilities, losses, claims, damages, and expenses
(including reasonable counsel fees and expenses) of any kind whatsoever arising
out of, or in any way connected with, or as a result of (a) the transactions
contemplated in the Loan Documents, (b) the use of proceeds of the Credit, (c)
the execution and delivery of any subsequent credit documentation or other
document contemplated hereby or thereby by the parties hereto or the performance
of their respective obligations hereunder or thereunder or (d) any claim,
action, suit, investigation, or proceeding relating to the foregoing or to any
Borrower whether or not the Indemnified Party is a party thereto; provided that
in no event shall any Borrower be liable for indemnity hereunder by reason of
any act or omission caused by the bad faith, gross negligence, or willful
misconduct of any Indemnified Party. The foregoing indemnity shall be effective
regardless of any investigation made by or on behalf of the Agent, the Issuing
Bank, any Bank, or any Borrower.
SECTION 11. MISCELLANEOUS.
11.1 COURSE OF DEALING; AMENDMENTS; WAIVER. No course of dealing between
the parties hereto shall be effective to amend, modify, or change any provision
of this Agreement or any other Loan Document. No amendment or waiver of any
provision of this Agreement or any other Loan Document, nor consent to any
departure by the Borrowers therefrom, shall in any event be effective unless the
same shall be in writing and signed by all of the Banks, unless otherwise
specifically provided, and each such waiver or consent shall be effective only
in the specific instance and for the specific purpose for which given;
including, without limitation, any amendment, waiver, or consent which shall,
unless otherwise specifically provided, do any of the following: (i) increase
the Revolving Credit Commitment of any Bank or subject the Banks to any
increased or additional obligations under the Loan Documents; (ii) reduce the
principal of, or interest on, the Advances, or any fees or other amounts payable
hereunder; (iii) postpone any date for any payment of principal of, or interest
on, the Advances, or any fees, or extend the Revolving Credit Maturity Date;
(iv) amend this Subsection or change the amount of Revolving Credit Commitments,
unpaid Advance amounts, or number of Banks required for the Banks or any of them
to take action hereunder; or (v) release all or substantially all of any
Collateral or permit additional encumbrances thereon, other than as may be
expressly permitted in this Agreement or the other Loan Documents; and provided
further, that no amendment, waiver, or consent shall, unless in writing and
signed by the Agent in addition to the Banks required to take such action,
affect the rights or duties of the Agent under this Agreement.
11.2 PAYMENT OF EXPENSES, INCLUDING ATTORNEYS' FEES AND TAXES. The
Borrowers agree (a) to pay or reimburse the Agent, the Issuing Bank, and each
Bank for all of their reasonable and customary out-of-pocket costs and expenses
incurred in connection with the preparation, negotiation, execution, and
delivery of, and any amendment, supplement, or modification to, or waiver or
consent under, the Loan Documents, and the consummation of the transactions
contemplated thereby, including, without limitation, the reasonable and
customary fees and disbursements of counsel for the Agent, the Issuing Bank, and
each Bank, taxes, and all recording or filing fees, (b) to pay or reimburse the
Agent, the Issuing Bank, and each Bank for all of their costs and expenses
incurred in connection with the administration, supervision, collection, or
enforcement of, or the preservation of any rights under, the Loan Documents or
the Letters of Credit, including, without limitation, the fees and disbursements
of counsel for the Agent, the Issuing Bank, and the Banks, including attorneys'
fees out of court, in trial, on appeal, in bankruptcy proceedings, or otherwise,
(c) without limiting the generality of provision (a) hereof, to pay or reimburse
the Agent, the Issuing Bank, and the Banks for, and indemnify and hold the
Agent, the Issuing Bank, and the Banks harmless against liability for, any and
all documentary stamp taxes, annual and non-recurring intangible taxes, or other
taxes, together with any interest, penalties, or other liabilities in connection
therewith, that the Agent, the Issuing Bank, or any Bank now or hereafter
determines are payable with respect to the Loan Documents, the obligations
evidenced by the Loan Documents, any Advances, the Letters of Credit, and any
guaranties or mortgages or other security instruments, and (d) to pay,
indemnify, and hold the Agent, the Issuing Bank, and the Banks harmless from and
against any and all other liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses, or disbursements of any kind or
nature whatsoever with respect to the execution, delivery, enforcement,
performance, and administration of the Loan Documents or the Letters of Credit.
The agreements in this Subsection shall survive repayment of all other amounts
payable hereunder or pursuant hereto, now or in the future, and shall be secured
by the Collateral.
11.3 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the Agent, each Bank, each Borrower, and their
respective successors and permitted assignees or transferees.
11.4 ASSIGNMENTS AND PARTICIPATIONS.
(a) No Borrower may assign or transfer any of its rights or
obligations under this Agreement without the prior written consent of each Bank.
(b) Each Bank may assign to one or more banks or other entities
all or a portion of its rights and obligations under this Agreement (including,
without limitation, all or a portion of its Revolving Credit Commitment and the
Advances owing to it; provided, however, that (i) the assignment shall be of a
uniform, and not a varying, percentage of all of the assigning the Bank's rights
and obligations under and in respect of the facility being assigned; (ii) the
amount of the Revolving Credit Commitment being assigned pursuant to the
assignment (determined as of the date of the assignment) shall not be less than
Five Million Dollars ($5,000,000.00) and shall be an integral multiple of One
Million Dollars ($1,000,000.00); (iii) the Borrowers and the Agent shall consent
to the assignment, which consent, in either case, shall not be unreasonably
withheld (except that no consent by the Borrowers or the Agent shall be required
in the case of any assignment to another Bank and no consent by the Borrowers
shall be required after an Event of Default shall have occurred and be
continuing); and (iv) the parties to the assignment shall execute and deliver to
the Agent an Assignment and Acceptance in the form attached hereto as Exhibit
"F", together with an assignment fee of $2,500.00.
(c) By executing and delivering an Assignment and Acceptance, the
assigning Bank thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows:
(i) other than the representation and warranty that it is
the legal and beneficial owner of the interest being assigned thereby free and
clear of any adverse claim, such assigning Bank makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties, or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency, or
value of this Agreement or any other instrument or document furnished pursuant
hereto;
(ii) such assigning Bank makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrowers or the performance or observance by any Borrower of any of its
obligations or any other instrument or document furnished pursuant hereto;
(iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 6.1 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance;
(iv) such assignee will, independently and without reliance
upon the Agent, such assigning Bank or any other Bank, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement;
(v) such assignee appoints and authorizes the Agent to take
such action as the Agent on its behalf and to exercise such powers under this
Agreement and the other Loan Documents as are delegated to the Agent by the
terms hereof and thereof, together with such powers as are reasonably incidental
thereto; and
(vi) such assignee agrees that it will perform in accordance
with their terms all of the obligations which by the terms of this Agreement are
required to be performed by it as a Bank.
(d) Each Bank may sell participations to one or more banks or
other entities in all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Revolving
Credit Commitment and the Advances owing to it); provided, however, that (i)
each such participation shall be in an amount not less than Five Million Dollars
($5,000,000.00); (ii) the Bank's obligations under this Agreement (including,
without limitation, its Revolving Credit Commitment) shall remain unchanged;
(iii) the Bank shall remain solely responsible to the other parties hereto for
the performance of such obligations; (iv) the Borrowers, the Agent, and the
other Banks shall continue to deal solely and directly with the Bank in
connection with the Bank's rights and obligations under this Agreement; and (v)
the Bank may not agree with the participant to require the participant's consent
or permit the participant to vote on whether to take or refrain from taking any
action or to approve any amendment or waiver of any provision of any Loan
Document, or any consent or any departure by any party therefrom, except that
the Bank may agree with the participant that the Bank will not, without the
consent or vote of the participant, agree to (1) increase the Revolving Credit
Commitment of such Bank or subject such Bank to any additional obligations; (2)
extend any revolving credit or line of credit termination or conversion date
affecting the Bank; (3) reduce the principal of, or interest on, the Advances
payable to the Bank or any fees or other amounts payable to the Bank; (4)
postpone any date for any payment of principal of, or interest on, the Advances
payable to the Bank or any fees or other amounts payable to the Bank; or (5)
release all or substantially all of the Collateral; in each case if the rights
of the participant are or would be affected thereby.
(e) Notwithstanding any of the foregoing to the contrary, nothing
herein is intended to prohibit the assigning, discounting, or pledging of all or
any portion of a Bank's interest in the Advances or the Note to any Federal
Reserve Bank as collateral security pursuant to regulations of the Board of
Governors of the Federal Reserve System and any Operating Circular issued by
such Federal Reserve Bank, and such Advances or interest in the Note shall be
fully transferrable as provided therein. No such assignment shall release the
assigning Bank from its obligations hereunder.
(f) The Borrowers agree that any participants shall have the same
rights of set-off against the Borrowers as granted the Banks in Subsection 11.6
hereof. Upon the written request of the Borrowers, the Banks will advise the
Borrowers of the names of any participants and the extent of their interest
herein.
11.5 CONFIDENTIAL INFORMATION.
(a) The Agent and the Banks shall exercise their good faith
efforts not to make any public disclosure of confidential information obtained
pursuant to the Loan Documents; provided, that the foregoing shall not be
construed to, now or in the future, apply to any information reflected in any
recorded document, information obtained from sources other than the Borrowers,
or otherwise in the public domain nor shall it be construed to prevent the Agent
or any Bank from (i) making any disclosure of any information (A) if required to
do so by any applicable law or regulation or accepted banking practice, (B) to
any governmental agency or regulatory body having or claiming authority to
regulate or oversee any aspect of the Agent's or such Bank's business or any of
its subsidiaries or affiliates in connection with the exercise of such authority
or claimed authority, (C) pursuant to subpoena, (D) to the extent the Agent or
such Bank or their respective counsel deems necessary or appropriate to do so to
effect or preserve the Collateral or to enforce any remedy provided for in the
Loan Documents or otherwise available by law, (ii) subject to the immediately
succeeding sentence, making such disclosures as such Bank reasonably deems
necessary or appropriate to any bank or financial institution (and/or counsel
thereto) which is a prospective assignee or participant under Subsection 11.4
(each such bank or financial institution, a "Prospective Bank") or (iii) making,
on a confidential basis, such disclosures as the Agent or such Bank deems
necessary or appropriate to the Agent's or such Bank's counsel or accountants
(including outside auditors).
(b) Each Bank agrees that prior to (a) disclosing to any
Prospective Bank any information which the Banks have agreed hereunder to hold
as confidential or (b) entering into an agreement granting to a Prospective Bank
an interest in the Advances, the applicable Bank shall make a good faith effort
to obtain an agreement executed by such Prospective Bank in form and substance
similar to the provisions of this Subsection; provided, that in no event shall
such Bank or the Agent be liable for any breach of such agreement by the
Prospective Bank.
11.6 LIENS; SET-OFF. Each Borrower hereby grants to the Agent and the
Banks (including any Banks added at a later time) a continuing lien to secure
all indebtedness of the Borrowers to the Agent and the Banks created hereunder
or pursuant to the Loan Documents upon any and all monies, securities, and other
property of such Borrower and the proceeds thereof, now or hereafter held or
received by or in transit to, the Agent or any Bank from or for the Borrowers,
and also upon any and all deposits (general or special) and credits of the
Borrowers, if any, at the Agent or any Bank, at any time existing. Upon the
occurrence of any Event of Default, the Agent, and the Banks are hereby
authorized at any time and from time to time, without notice to such Borrower,
to set off, appropriate, and apply any or all items hereinabove referred to
against indebtedness of the Borrowers owed to the Agent or the Banks under the
Loan Documents, whether now existing or hereafter arising. The Agent or any
Bank shall be deemed to have exercised such right of set-off and to have made a
charge against such items immediately upon the occurrence of such Event of
Default although made or entered on its books subsequent thereof.
Notwithstanding the foregoing, any Bank exercising any right to set-off
hereunder shall promptly thereafter deliver to the Agent and the Borrowers a
written notice thereof, provided that any failure to deliver such notice shall
not, in any event, limit such Bank's or any other Bank's right of set-off
hereunder.
11.7 NOTICES. Unless otherwise specifically provided herein, any notice
or other communication herein required or permitted to be given shall be in
writing and may be personally served, telecopied, telexed, or sent by United
States mail or courier service and shall be deemed to have been given when
delivered in person, receipt of telecopy or telex or four Business Days after
depositing it in the United States mail, registered or certified, with postage
prepaid and properly addressed. For the purposes hereof, the addresses of the
parties hereto (until notice of a change thereof is delivered as provided in
this Subsection 11.7) shall be as set forth under each party's name on the
signature pages hereof.
11.8 WAIVER OF DEFAULT. The Banks may, in accordance with the provisions
of Subsection 11.1, by written notice to the Borrowers, at any time and from
time to time, waive any Event of Default and its consequences, or any default in
the performance or observance of any condition, covenant, or other term hereof
and its consequences. Any such waiver shall be for such period and subject to
such conditions as shall be specified in any such notice. In the case of any
such waiver, the Borrowers and the Banks shall be restored to their former
positions prior to such Event of Default or default and shall have the same
rights as they had thereto, and any Event of Default or default so waived shall
be deemed to be cured and not continuing; but no such waiver shall extend to any
subsequent or other Event of Default or default, or impair any right consequent
thereto.
11.9 NO WAIVER; CUMULATIVE REMEDIES. No omission or failure of the Agent
or the Banks to exercise and no delay in exercising by the Agent or the Banks of
any power, or privilege, shall operate as a waiver thereof or be construed to be
a waiver thereof; nor shall any single or partial exercise of any right, power,
or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, power, or privilege. The rights and remedies
provided in the Loan Documents are cumulative and not exclusive of any rights or
remedies provided by law, and the warranties, representations, covenants, and
agreements made therein shall be cumulative, except in the case of
irreconcilable inconsistency, in which case the provisions of this Agreement
shall control.
11.10 VENUE AND JURISDICTION. In any litigation in connection with or to
enforce this Agreement or any of the other Loan Documents, each Borrower
irrevocably consents to and confers personal jurisdiction on the courts of the
State of Florida located in Orange County or the United States courts located
within the Middle District of the State of Florida, expressly waives any
objections as to venue in any of such courts, and agrees that service of process
may be made on such Borrower by mailing a copy of the summons and complaint by
registered or certified mail, return receipt requested, to the address set forth
herein below the name of the Borrower on the signature page hereto (or otherwise
expressly provided in writing). Nothing contained herein shall, however,
prevent the Agent from bringing any action or exercising any rights within any
other state or jurisdiction or from obtaining personal jurisdiction by any other
means available by applicable law.
11.11 GOVERNING LAW. The validity, interpretation, and enforcement of
this Agreement, of the rights and obligations of the parties hereto, and of the
other documents delivered in connection herewith shall be governed by, and
construed and interpreted in accordance with, the laws of the State of Florida,
excluding those laws relating to the resolution of conflicts between laws of
different jurisdictions.
11.12 TITLE AND HEADINGS; TABLE OF CONTENTS. The titles and headings
preceding the text of the Sections and Subsections of this Agreement and the
Table of Contents have been inserted and included solely for convenience of
reference and shall neither constitute a part of this Agreement nor affect its
meaning, interpretation, or effect.
11.13 COMPLETE AGREEMENT. The Loan Documents contain the final, complete,
and exclusive expression of the understanding of the Borrowers, the Agent, and
the Banks with respect to the transactions contemplated by the Loan Documents
and supersede any prior or contemporaneous agreement or representation, oral or
written, by or between the parties related to the subject matter hereof.
11.14 LEGAL OR GOVERNMENTAL LIMITATIONS. Anything contained in this
Agreement to the contrary notwithstanding, the Banks shall not be obligated to
extend credit or make any loans to the Borrowers in an amount in violation of
any limitations or prohibitions provided by any applicable statute or
regulation.
11.15 COUNTERPARTS. This Agreement and any amendment hereof may be
executed in several counterparts and by each party on a separate counterpart,
each of which when so executed and delivered shall be an original, and all of
which together shall constitute one instrument.
11.16 ADDITIONAL BANKS.
(a) Agent may, upon the consent of the Borrowers, which consent
shall not be unreasonably withheld, at any time add one or more banks to this
Agreement by each such bank agreeing to be bound by the terms of this Agreement
by virtue of executing a signature page hereto, which shall contain the amount
of such bank's Revolving Credit Commitment. Upon the execution of a signature
page hereto and the satisfaction of the conditions and other terms herein, such
additional bank shall be deemed a "Bank" for the purposes of this Agreement and
shall enjoy all rights and assume all obligations of a Bank as set forth in this
Agreement.
(b) Upon the execution of a signature page hereto by the
additional Bank, the then existing Banks shall be deemed to sell and assign to
the additional Bank, without representation, warranty, or recourse, and the
additional Bank shall be deemed to purchase and assume from the existing Banks,
a portion of the rights and obligations of the existing Banks with respect to
the Credit such that after the sale and assignment each of the Banks (including
the additional Bank) shall own a portion of the Credit, the Advances, and the
Letter of Credit Contingent Obligations in an amount equal to its Pro Rata
Portion (after adjustment to take into account the Revolving Credit Commitment
of the additional Bank). Pursuant to such sale and assignment of a portion of
the Credit, the existing Banks are entitled to payment of all amounts owing
under the portions of the Credit sold and assigned, and the additional Bank
shall pay to the Agent, for the benefit of the existing Banks, at its Lending
Office specified in the signature pages hereof, in immediately available funds,
an amount equal to the additional Bank's Pro Rata Portion of all amounts owing
under the Credit.
(c) By executing and delivering a signature page hereto, the
additional Bank confirms to and agrees with the other parties hereto as follows:
(i) the Banks and the Agent make no representation or
warranty and assume no responsibility with respect to any statements,
warranties, or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency, or
value of this Agreement or any other instrument or document furnished pursuant
hereto;
(ii) the Banks and the Agent make no representation or
warranty and assume no responsibility with respect to the financial condition of
the Borrowers or the performance or observance by any Borrower of any of its
obligations or any other instrument or document furnished pursuant hereto;
(iii) the additional Bank confirms that it has received a copy
of this Agreement, together with copies of the financial statements referred to
in Section 6.1 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Agreement;
(iv) the additional Bank will, independently and without
reliance upon the Agent or any of the Banks, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement;
(v) the additional Bank appoints and authorizes the Agent to
take such action as the Agent on its behalf and to exercise such powers under
this Agreement and the other Loan Documents as are delegated to the Agent by the
terms hereof and thereof, together with such powers as are reasonably incidental
thereto; and
(vi) the additional Bank agrees that it will perform in
accordance with their terms all of the obligations which by the terms of this
Agreement are required to be performed by it as a Bank.
11.17 WAIVER OF JURY TRIAL BY BORROWERS. EACH BORROWER HEREBY KNOWINGLY,
VOLUNTARILY, AND INTENTIONALLY WAIVES ANY RESPECTIVE RIGHTS IT MAY HAVE TO A
TRIAL BY JURY WITH RESPECT TO ANY LITIGATION BASED ON THE LOAN DOCUMENTS OR
ARISING OUT OF, UNDER OR IN CONNECTION THEREWITH, OR ANY AGREEMENT CONTEMPLATED
TO BE EXECUTED IN CONNECTION THEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY WITH
RESPECT HERETO OR THERETO. FURTHERMORE, NO BORROWER SHALL SEEK TO CONSOLIDATE
ANY ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY ACTION IN WHICH A JURY
TRIAL CANNOT BE WAIVED. THIS WAIVER IS A MATERIAL INDUCEMENT FOR THE BANKS
ACCEPTING AND ENTERING INTO THE CREDIT CONTEMPLATED BY THE LOAN DOCUMENTS (OR
ANY AGREEMENT EXECUTED IN CONNECTION WITH THE LOAN DOCUMENTS) FROM, OR WITH, THE
BORROWERS.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.
Signed, sealed and delivered
in the presence of: COMMERCIAL NET LEASE REALTY, INC.
a Maryland corporation
/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------- -------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇, Executive Vice President and
Chief Financial Officer
Address: ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
-----------------------------------
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
TELECOPY NO. 407/423-2894
CONFIRMING TEL. NO. 407/▇▇▇-▇▇▇▇
(SEAL)
Wire Instructions:
BANK: First Union National Bank of Florida
CITY, STATE: Jacksonville, Florida
Attn: Orlando Office
ABA: ▇▇▇▇▇▇▇▇▇
FOR CREDIT TO: Commercial Net Lease
Realty, Inc.
ACCOUNT NO.: 2090000573765
[Signatures continued on next page]
SIGNATURE PAGE
--------------
Second Amended and Restated Revolving Line of Credit and Security
Agreement Among Commercial Net Lease Realty, Inc., Net Lease Realty I, Inc., Net
Lease Realty II, Inc., First Union National Bank of Florida, as the Agent and
the Banks Listed on the Signature Pages Thereof.
-------------------------------------------------------------------------------
Witnesses: NET LEASE REALTY I, INC.
a Maryland corporation
/s/▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------- -------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇, Executive Vice President and
Chief Financial Officer
Address: ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
-----------------------------------
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
TELECOPY NO. 407/423-2894
CONFIRMING TEL. NO. 407/▇▇▇-▇▇▇▇
(SEAL)
Wire Instructions:
BANK: First Union National Bank of Florida
CITY, STATE: Jacksonville, Florida
Attn: Orlando Office
ABA: ▇▇▇▇▇▇▇▇▇
FOR CREDIT TO: Net Lease Realty I, Inc.
ACCOUNT NO.: 2090001569574
[Signatures continued on next page]
SIGNATURE PAGE
--------------
Second Amended and Restated Revolving Line of Credit and Security
Agreement Among Commercial Net Lease Realty, Inc., Net Lease Realty I, Inc., Net
Lease Realty II, Inc., First Union National Bank of Florida, as the Agent and
the Banks Listed on the Signature Pages Thereof.
-------------------------------------------------------------------------------
Witnesses: NET LEASE REALTY II, INC.
a Maryland corporation
/s/▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------- -----------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇, Executive Vice President and
Chief Financial Officer
Address: ▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
-----------------------------------
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
TELECOPY NO. 407/423-2894
CONFIRMING TEL. NO. 407/▇▇▇-▇▇▇▇
Wire Instructions:
BANK: First Union National Bank of Florida
CITY, STATE: Jacksonville, Florida
Attn: Orlando Office
ABA: ▇▇▇▇▇▇▇▇▇
FOR CREDIT TO: Net Lease Realty II, Inc.
ACCOUNT NO.: 2090001569561
[Signatures continued on next page]
SIGNATURE PAGE
--------------
Second Amended and Restated Revolving Line of Credit and Security
Agreement Among Commercial Net Lease Realty, Inc., Net Lease Realty I, Inc., Net
Lease Realty II, Inc., First Union National Bank of Florida, as the Agent and
the Banks Listed on the Signature Pages Thereof.
-------------------------------------------------------------------------------
Witnesses: FIRST UNION NATIONAL BANK OF
FLORIDA, a national banking
association, individually and as Agent
-----------------------------------
By:/s/▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
▇▇▇▇ ▇▇▇▇▇▇, Vice President
-----------------------------------
Address and Lending Office:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
TELECOPIER NO. 407/649-5732
CONFIRMING TEL. NO. 407/▇▇▇-▇▇▇▇
Revolving Credit Commitment: Wire Instructions:
$35,000,000.00 ABA NO.: ▇▇▇▇▇▇▇▇▇
First Union National Bank of Florida
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
[Signatures continued on next page]
SIGNATURE PAGE
--------------
Second Amended and Restated Revolving Line of Credit and Security
Agreement Among Commercial Net Lease Realty, Inc., Net Lease Realty I, Inc., Net
Lease Realty II, Inc., First Union National Bank of Florida, as the Agent and
the Banks Listed on the Signature Pages Thereof.
-------------------------------------------------------------------------------
Witnesses: SOUTHTRUST BANK OF ALABAMA
NATIONAL ASSOCIATION, a national
banking association
------------------------------------
By:/s/▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇ ▇▇▇▇▇▇▇, Vice President
------------------------------------
Address: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
TELECOPIER NO. 813/898-5319
CONFIRMING TEL. NO. 813/▇▇▇-▇▇▇▇
Lending Office: ▇▇▇ ▇. ▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TELECOPIER NO. ▇-▇▇▇-▇▇▇-▇▇▇▇
CONFIRMING TEL. NO. ▇-▇▇▇-▇▇▇-▇▇▇▇
Ext. 5791
Revolving Credit Commitment: Wire Instructions:
---------------------------
$20,000,000.00 ABA: ▇▇▇▇▇▇▇▇▇
ACCOUNT NO.: 515549
ATTN: ▇▇▇▇▇ Dollar
Southeastern Banking
re: Commercial Net Lease Realty, Inc.
[Signatures continued on next page]
SIGNATURE PAGE
--------------
Second Amended and Restated Revolving Line of Credit and Security
Agreement Among Commercial Net Lease Realty, Inc., Net Lease Realty I, Inc., Net
Lease Realty II, Inc., First Union National Bank of Florida, as the Agent and
the Banks Listed on the Signature Pages Thereof.
-------------------------------------------------------------------------------
Witnesses: CREDITANSTALT CORPORATE FINANCE, INC.
By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------- ----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇. Vice President
By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------- ----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Vice President
Address and Lending Office:
Creditanstalt Corporate Finance, Inc.
Two ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
TELECOPIER NO. 203/861-6594
TELEPHONE NO. 203/▇▇▇-▇▇▇▇
With copy to:
Creditanstalt Bankverein
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
TELECOPIER NO. 404/390-1851
TELEPHONE NO. 404/▇▇▇-▇▇▇▇
Revolving Credit Commitment: Wire Instructions:
---------------------------
$20,000,000.00 BANK: Chemical Bank
CITY, STATE: New York, NY
ABA: ▇▇▇▇▇▇▇▇▇
ACCOUNT TITLE: Creditanstalt, NY
ACCOUNT NO.: ▇▇▇-▇-▇▇▇▇▇
ATTN: ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇'▇▇▇▇
With Copy To: ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
[Signatures continued on next page]
SIGNATURE PAGE
--------------
Second Amended and Restated Revolving Line of Credit and Security
Agreement among Commercial Net Lease Realty, Inc., Net Lease Realty I, Inc., Net
Lease Realty II, Inc., First Union National Bank of Florida, as the Agent and
the Banks Listed on the Signature Pages Thereof.
-------------------------------------------------------------------------------
Witnesses: AMSOUTH BANK OF FLORIDA
By:/s/▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------- ----------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President
-----------------------------------
Address and Lending Office:
AmSouth Bank of Florida
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇
TELECOPIER NO. 407/649-8944
CONFIRMING TEL. NO. 407/▇▇▇-▇▇▇▇
Revolving Credit Commitment: Wire Instructions:
---------------------------
$5,000,000.00 BANK: AmSouth Bank of Florida
CITY, STATE: Orlando, Florida
ABA: ▇▇▇▇▇▇▇▇▇
ACCOUNT TITLE: AmSouth Bank of Florida
ACCOUNT NO.:
ATTN: ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇
[Signatures continued on next page]
SIGNATURE PAGE
--------------
Second Amended and Restated Revolving Line of Credit and Security
Agreement among Commercial Net Lease Realty, Inc., Net Lease Realty I, Inc., Net
Lease Realty II, Inc., First Union National Bank of Florida, as the Agent and
the Banks Listed on the Signature Pages Thereof.
--------------------------------------------------------------------------------
Witnesses: COMERICA BANK - TEXAS
By:/s/▇▇▇▇▇▇▇ ▇▇▇▇▇ Gosslie
----------------------------------- ----------------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇ Gosslie
Corporate Banking Officer
-----------------------------------
Address and Lending Office:
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, Second Floor
Commercial Real Estate
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Revolving Credit Commitment: Wire Instructions:
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$20,000,000.00 BANK: COMERICA BANK - TEXAS
CITY, STATE: Dallas, Texas
ABA: 111 000 753
LOAN TITLE: Commercial Net Lease Realty,
Inc.
LOAN NO.:
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ATTN: ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, Second Floor
Commercial Real Estate
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