Exhibit 10.53
SECOND AMENDED AND RESTATED
UNSECURED LINE OF CREDIT LOAN AGREEMENT
By and Among
BRE PROPERTIES, INC.,
as Borrower,
the several financial institutions from time to time party to this Agreement,
as Banks or Designated Bid Lenders
and
BANK OF AMERICA, N.A.,
as Administrative Agent
and
BANK ONE, NA, as Syndication Agent
and
COMMERZBANK AG, as Documentation Agent,
Dated as of December 19, ▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ SECURITIES LLC,
as Sole Lead Arranger and Book Manager
SECOND AMENDED AND RESTATED
UNSECURED
LINE OF CREDIT LOAN AGREEMENT
THIS SECOND AMENDED AND RESTATED UNSECURED LINE OF CREDIT LOAN
AGREEMENT ("Agreement") is entered into as of December 19, 2000, among BRE
PROPERTIES, INC., a Maryland corporation ("Borrower"); the several financial
institutions identified on the signature pages hereto as "Banks" (collectively,
the "Banks", and individually a "Bank"); those entities identified on the
signature pages hereto as "Designated Bid Lenders" (collectively, the
"Designated Bid Lenders", and individually a "Designated Bid Lender"); and BANK
OF AMERICA, N.A., a national banking association ("BofA"), in its capacity as a
Bank and as administrative agent for the Banks (in that capacity,
"Administrative Agent").
RECITALS:
A. Borrower, Administrative Agent, BofA as a "Bank" and the several
financial institutions identified on the signature pages thereto as "Banks" and
"Designated Bid Lenders" (each as defined therein) are parties to an Amended and
Restated Unsecured Line of Credit Loan Agreement dated as of October 21, 1998,
as amended by the First Amendment Agreement thereto dated as of February 4, 2000
(as so amended, the "Existing Agreement").
B. The parties desire to amend and restate the Existing Agreement
all as set forth herein.
NOW, THEREFORE, the Existing Agreement is hereby amended and restated
to read in its entirety as follows:
CERTAIN DEFINITIONS
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The following terms used in this Agreement shall have the following
meanings (such meanings to be applicable, except to the extent otherwise
indicated in a definition of a particular term, both to the singular and the
plural forms of the terms defined; other terms are defined elsewhere in the
Agreement, and capitalized terms that are used herein without definition but
that are defined in the Note or the Guaranty have the definitions ascribed to
them therein):
"Absolute Rate" means, in connection with any Absolute Rate Auction,
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the rate of interest per annum (expressed in multiples of 1/1000th of one basis
point) offered for any Bid Loan to be made pursuant thereto.
"Absolute Rate Auction" means a solicitation of Competitive Bids
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setting forth Absolute Rates pursuant to Section 1.3(b).
"Absolute Rate Bid Loan" means a Bid Loan that bears interest at an
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Absolute Rate.
"Accommodation Obligations", as applied to any Person, means any
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Indebtedness or other Contractual Obligation or liability, contingent or
otherwise, of another Person in respect of which that Person is liable,
including, without limitation, any such indebtedness, obligation or liability
directly or indirectly guaranteed, endorsed (otherwise than for collection or
deposit in the ordinary course of business), co-made or discounted or sold with
recourse by that Person, or in respect of which that Person is otherwise
directly or indirectly liable, including in respect of any partnership in which
that Person is a general partner, Contractual Obligations (contingent or
otherwise) arising through any agreement to purchase, repurchase or otherwise
acquire such indebtedness, obligation or liability or any security therefor, or
to provide funds for the payment or discharge thereof (whether in the form of
loans, advances, stock purchases, capital contributions or otherwise), or to
maintain solvency, assets, level of income, or other financial condition, or to
make payment other than for value received.
"Adjusted EBITDA" means, for the most recent three (3) month period,
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(i) the sum of (a) Borrower's consolidated net income as determined in
accordance with GAAP, (b) depreciation and amortization expense and other non-
cash items deducted on Borrower's consolidated financial statements in
determining such net income, (c) interest expense (as it appears on Borrower's
consolidated income statement in accordance with GAAP), and (d) taxes imposed by
any jurisdiction upon Borrower's or any Consolidated Borrower Entity's or
Consolidated Joint Venture Entity's net income, absent the effect of
extraordinary items or asset sales or write-ups or forgiveness of Indebtedness;
minus (ii) the sum of (a) $50 per apartment unit in the case of a real property
asset, owned by Borrower or any Consolidated Borrower Entity or Consolidated
Joint Venture Entity, that is improved with an apartment project, and (b) in the
case of any other real property asset owned by Borrower or any Consolidated
Borrower Entity or Consolidated Joint Venture Entity, $0.125 for each rentable
square foot of the improvements thereon. (All references in this Agreement to
"apartment project" shall be understood to mean multi-family residential
properties held for rental.)
"Administrative Agent" means BofA in its capacity as administrative
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agent for the Banks hereunder, and any successor administrative agent.
"Administrative Agent-Related Persons" means BofA and any successor
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administrative agent hereunder, together with their respective Affiliates and
the officers, directors, employees and agents of such Persons.
"Administrative Agent's Office" means the address for payments set
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forth herein for Administrative Agent, or such other address as Administrative
Agent may specify.
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"Advance" means any advance of proceeds, whether of a Committed Loan
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(including Swing Line Borrowings and payments under Letters of Credit) or a Bid
Loan, made pursuant to the terms of the Loan Documents.
"Affiliate" means, as to any Person, any other Person which, directly
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or indirectly, is in control of, is controlled by, or is under common control
with, such Person. A Person shall be deemed to control another Person if the
controlling Person possesses, directly or indirectly, the power to direct or
cause the direction of the management and policies of the other Person, whether
through the ownership of voting securities, membership interests, by contract,
or otherwise.
"Applicable Capitalization Rate" means, for any real property asset,
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9.00%, or such rate(s) as the Majority Banks, taking into consideration such
factors as the location or type of such real estate asset, may establish from
time to time (but no more often than once in any calendar year) as the
applicable capitalization rate for all or a particular type of real property
asset.
"Applicable Facility Fee Percentage" means, as of any date of
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determination, (i) if no Rating is then in effect, 0.20%; or (ii) effective on
the first day of the fiscal quarter following Borrower's obtaining a Rating (or
a change in the then-effective Rating) and giving written notice thereof to
Administrative Agent, the Applicable Facility Fee Percentage set forth below in
the definition of "Applicable Margin" opposite the then Rating (as determined in
accordance with the definition of "Applicable Margin") of Borrower. As of the
date of this Agreement, Borrower has obtained Ratings of (x) BBB from Standard &
Poor's, (y) Baa2 from Moody's Investor's Service and (z) BBB+ from Duff &
▇▇▇▇▇▇, Inc., and the Applicable Facility Fee Percentage for the current
calendar quarter is 0.20%.
"Applicable Margin" means, as of any date of determination, (i) if no
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Rating is then in effect, 1.30%; or (ii) effective on the first day of the
fiscal quarter following Borrower's obtaining a Rating (or a change in the then-
effective Rating) and giving written notice thereof to Administrative Agent, the
Applicable Margin set forth below opposite the then Rating (as hereinbelow
determined) of Borrower:
Applicable
Rating Facility Fee
(S&P/Moody's) Applicable Margin Percentage
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A-/A3 or better 0.55% 0.15%
BBB+/Baal 0.60% 0.20%
BBB/Baa2 0.70% 0.20%
BBB-/Baa3 1.00% 0.20%
Below BBB-/Baa3 1.30% 0.20%
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"Availability Period" means the period commencing on the Effective
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Date and ending on the Maturity Date, subject to earlier termination in
accordance with the provisions of the Loan Documents.
"Bank" has the meaning specified in the introductory sentence of this
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Agreement; BofA in its capacity as a lender hereunder is one of the Banks.
"Banking Day" or "Business Day" means any day other than a Saturday,
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Sunday, or other day on which commercial banks are authorized to close under the
Laws of, or are in fact closed in, the state where the Administrative Agent's
Office is located and, if such day relates to any LIBOR Rate Loan, means any
such day on which dealings in Dollar deposits are conducted by and between banks
in the applicable offshore Dollar interbank market.
"Bid Loan" means an Advance by a Bank or its Designated Bid Lender
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pursuant to the Bid Loan Facility, and may be either an Absolute Rate Bid Loan
or a LIBOR Bid Loan.
"Bid Loan Facility" means the credit facility for the requesting and
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making of Bid Loans described in Sections 1.2(c) and 1.3(b).
"Bid Loan Facility Limit" means, at any time, an amount equal to fifty
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percent (50%) of the Maximum Loan Amount.
"Bid Loan Rate Period" means (i) with respect to a LIBOR Bid Loan, the
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period, commencing on the date of such LIBOR Bid Loan and ending on a date
(determined by Administrative Agent in accordance with the practices of the
London U.S. dollar inter-bank market) that is one, two, three or six months
later, but not extending beyond the Maturity Date; and (ii) with respect to an
Absolute Rate Bid Loan, commencing on the date of such Absolute Rate Bid Loan
and ending on a Banking Day that is at least 14, but no more than 180 days,
later (but not extending beyond the Maturity Date), as specified by Borrower in
the relevant Competitive Bid Request.
"BofA" means Bank of America, N.A., a national banking association.
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"Borrower Entity" means each Person, other than a Joint Venture
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Entity, in which Borrower, directly or indirectly, has made an Investment,
whether or not under GAAP the financial results of such Person are reported on a
consolidated basis with the results of Borrower.
"Borrowing" means a borrowing hereunder consisting of Advances of the
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same type (i.e., Committed Loans, Absolute Rate Bid Loans, or LIBOR Bid Loans)
made to Borrower on the same day and (except in the case of Committed Loans
accruing interest at the Reference Rate) having the same Rate Period (as defined
in the Note) or Bid Loan Rate Period, as the case may be.
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"Borrowing Notice" has the meaning ascribed to it in Section 3.1(b).
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"Capital Adequacy Regulation" means any guideline or directive of any
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central bank or other Governmental Authority, or any other law, rule or
regulation regarding capital adequacy of a Bank or of any corporation
controlling a Bank.
"Charter Documents" means, with respect to any Person, such Person's
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partnership agreement (if any), articles or certificate of incorporation or
organization or other document required to effect the formation of such Person
(including all certificates of determination or other instruments relating to
the rights of preferred stockholders of such Person) (if any), by-laws (if any),
and any operating agreement, management agreement or other agreement among any
stockholders or other holders of any interest in such Person, in their
respective capacities as such, in each case, as at any time amended or restated.
"Co-Lender Agreement" has the meaning ascribed to it in Section 10.4.
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"Committed Loan" means an Advance made by the Banks pursuant to the
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Line of Credit described in Section 1.1, and shall include (i) each other
Advance, initially made under the Swing Line, that is deemed converted into a
Committed Loan pursuant to Section 1.2(b)(iii), (ii) except where the context
otherwise requires, each Swing Line Borrowing, and (iii) each Advance consisting
of the payment by Administrative Agent of a draw under a Letter of Credit.
"Committed Loan Availability" means, at any time, the Maximum Loan
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Amount less (i) the aggregate principal amount of all Loans then outstanding,
and (ii) the Letter of Credit Exposure.
"Commitment" means the amount of the Line of Credit for which each
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Bank is obligated.
"Competitive Bid" means an offer by a Bank to make a Bid Loan in
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response to a Competitive Bid Request.
"Competitive Bid Request" means a notice, in substantially the form of
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Exhibit C, requesting that the Banks submit bids for a Bid Loan.
"Consolidated" means, with respect to any Person, that such Person's
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financial results are consolidated (or required to be consolidated) under GAAP
with the financial results of Borrower.
"Contractual Obligation," as applied to any Person, means any
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provision of any securities issued by that Person or any indenture, mortgage,
deed of trust, lease, contract, undertaking, document or instrument to which
that Person is a party or by which it or any of its properties is bound, or to
which it or any of its properties is subject.
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"Controlled" means, as applied to any Borrower Entity or Joint Venture
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Entity, (i) that Borrower, or another Person that is Controlled by Borrower, (a)
owns at least fifty percent (50%) of the outstanding equity interests in such
Borrower Entity or Joint Venture Entity, and (b) serves as a managing partner,
managing member, trustee or in any similar capacity, however denominated, of
such Borrower Entity or Joint Venture Entity, and (ii) that Borrower, or such
other Controlled Person, has discretion and authority, under such Borrower
Entity's or Joint Venture Entity's Charter Documents, to cause such Borrower
Entity or Joint Venture Entity to encumber or sell such Borrower Entity's or
Joint Venture Entity's real property (subject, in the case of BRE Property
Investors LLC and Cambridge Park LLC, to any contractual restrictions on taxable
sales or exchanges of property set forth in its Charter Documents, as in effect
on the date hereof); and "Control" has a correlative meaning.
"Control Agreement" means an agreement in substantially the form of
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Exhibit H, as such agreement may at any time be amended, supplemented or
replaced.
"CPA" means Ernst & Young, LLP, any other "big five" accounting firm
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or another firm of certified public accountants of national standing selected by
Borrower and acceptable to the Majority Banks.
"Current Value Method" means, with respect to each real property asset
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as of any date: (i) if such real property has not been operated under ownership
by Borrower, a Controlled Borrower Entity or a Controlled Joint Venture Entity
for at least three (3) months, or is a completed building that is part of a
larger development project that remains under construction, on a cost basis, as
reflected in such owner's books in accordance with GAAP; and (ii) in any other
case, capitalization of the Net Operating Income for such real property for the
four (4) most recent calendar quarters (or, if Borrower, a Controlled Borrower
Entity or a Controlled Joint Venture Entity has owned a real property asset for
less than such time period, then the annualized Net Operating Income for such
real property based on the period of ownership by such Person), as certified by
Borrower to Administrative Agent and the Banks, at an annual rate equal to the
Applicable Capitalization Rate.
"Designated Bid Lender" means a special purpose corporation, organized
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under the laws of the United States or any subdivision thereof, that is engaged
in making, purchasing or otherwise investing in commercial loans in the ordinary
course of its business and that (i) shall have become a party to a Designation
Agreement pursuant to Section 11.5, and (ii) is not otherwise a Bank.
References herein to a Bank's Designated Bid Lender or a Designating Bank's
Designated Bid Lender mean the Designated Bid Lender party to a Designation
Agreement with such Bank or Designating Bank.
"Designating Bank" means a Bank that has entered into a Designation
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Agreement with a Designated Bid Lender pursuant to Section 11.5.
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"Designation Agreement" means a designation agreement, in
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substantially the form of Exhibit E, entered into by a Bank and a Designated Bid
Lender and accepted by Borrower and Administrative Agent.
"Dollar" and "$" means lawful money of the United States of America.
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"Effective Date" means the date on which this Agreement has been
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executed and delivered by each of the parties hereto and the conditions
precedent to the initial Advance hereunder set forth in Section 4.1 have been
satisfied.
"Eligible Assignee" means (i) a commercial bank or investment bank
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organized under the laws of the United States, or any state thereof, and having
a combined capital and surplus of at least $100,000,000; (ii) a Person that is
primarily engaged in the business of commercial banking and is an Affiliate of a
Bank; or (iii) any other Person approved by Majority Banks and Administrative
Agent.
"Environmental Laws" means all applicable federal, state or local
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statutes, laws, ordinances, codes, rules and regulations (including consent
decrees and administrative orders) relating to public health and safety and
protection of the environment.
"Event of Default" has the meaning given to it in Section 8.
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"Federal Funds Rate" means, for any day, the rate per annum (rounded
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upwards to the nearest 1/100 of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank on the Business Day next succeeding such day; provided that
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(a) if such day is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate charged to BofA on such day on such transactions
as determined by the Administrative Agent.
"Fixed Charges" means, for the most recent three (3) month period,
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Interest Expense for such period plus scheduled or otherwise required principal
amortization (i.e., excluding any balloon payment due at maturity) for such
period on all of Borrower's Indebtedness, determined on a consolidated basis,
plus all dividends accrued during such period in respect of any and all
outstanding preferred shares of Borrower, whether or not declared or paid.
"Funding Date" means (i) with respect to any Advance, the date of the
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funding of such Advance, and (ii) with respect to the issuance of any Letter of
Credit, the date of such issuance.
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"Funds From Operations" means, for any period, Borrower's consolidated
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net income (computed in accordance with GAAP), excluding gains (or losses) from
debt restructuring and sales of property, plus depreciation and amortization,
and after adjustments for unconsolidated Borrower Entities and unconsolidated
Joint Venture Entities. (Adjustments for unconsolidated partnerships and
unconsolidated Joint Venture Entities shall be calculated to reflect funds from
operations on the same basis.)
"GAAP" means generally accepted accounting principles set forth in the
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opinions and pronouncements of the Accounting Principles Board and the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board, or in such other statements by such
other entity as may be in general use by significant segments of the accounting
profession, which are applicable to the circumstances as of the date of
determination.
"Governmental Authority" means any government, state or other
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political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any entity owned or controlled through capital ownership or otherwise by any
of the foregoing.
"Guaranty" means a guaranty of Borrower's obligations under the Loan
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Documents, executed by one or more Borrower Entities or Joint Venture Entities,
in substantially the form of Exhibit I attached hereto.
"Guarantor" means each Borrower Entity or Joint Venture Entity that is
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a party to a Guaranty, including BRE Property Investors LLC and Cambridge Park
LLC.
"Indebtedness," as applied to any Person (and without duplication),
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means (i) all indebtedness, obligations or other liabilities for borrowed money,
(ii) all indebtedness, obligations or other liabilities evidenced by notes,
bonds, debentures or other similar instruments, (iii) all reimbursement
obligations and other liabilities with respect to letters of credit, banker's
acceptances, surety bonds or similar instruments issued for such Person's
account, (iv) all obligations to pay the deferred purchase price of property or
services, (v) all obligations in respect of capital leases, (vi) all
Accommodation Obligations, (vii) net obligations under any interest rate swaps,
caps or other derivatives ("Swap Contracts") in an amount equal to (A) if such
Swap Contract has been closed out, the termination value thereof, or (B) if such
Swap Contract has not been closed out, the ▇▇▇▇-to market value thereof
determined on the basis of readily available quotations provided by any
recognized dealer in such Swap Contract, and (viii) all indebtedness,
obligations or other liabilities of such Person or others secured by a Lien on
any asset of such Person, whether or not such indebtedness, obligations or
liabilities are assumed by, or are a personal liability of, such Person
(including, without limitation, the principal amount of any assessment or
similar indebtedness encumbering any asset); provided that, in determining the
amount of any Person's indebtedness under clause (ii) of this
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definition in respect of construction financing, only the outstanding principal
amount of such construction financing (and not the unused portion of the related
commitment) shall be included.
"Indemnified Liabilities" has the meaning given in Section 2.3.
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"Indemnified Person" has the meaning given in Section 2.3.
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"Insolvency Proceeding" has the meaning given in Section 2.2(b).
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"Intangible Assets" means all assets that would be classified as
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intangible assets under GAAP, including, without limitation, goodwill, patents,
trademarks, trade names, copyrights and franchises, treasury stock held by
Borrower or any Consolidated Borrower Entity or Consolidated Joint Venture
Entity, and deferred charges (including but not limited to unamortized debt
discount and expense, organization expenses, experimental and development
expenses, but excluding prepaid expenses).
"Interest Expense" means, for any period, the total interest expense
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of Borrower, whether paid, accrued or capitalized (including the interest
component of capital leases and including interest-related costs such as amounts
payable under interest rate swaps, caps or other derivatives and loan fees, to
the extent that such costs are permitted to be amortized under GAAP, but
excluding amounts, such as prepayment premiums and breakage fees, that are not
permitted to be amortized under GAAP), for such period, determined on a
consolidated basis.
"Investment" means in the case of each Borrower Entity and Joint
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Venture Entity, Borrower's total investment therein determined on the basis of
actual cost, including all equity contributions, loans, advances and guaranties
or other contractual undertakings in the nature thereof, whether funded or
committed.
"Joint Venture Entity" means a Person (i) in which Borrower, directly
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or indirectly, has made an Investment, whether or not under GAAP the financial
results of such Person should be reported on a consolidated basis with those of
Borrower, and (ii) which is in substance a joint venture, formed for the sole
purpose of developing apartment projects, with a Person, other than an Affiliate
of Borrower, that is (a) a regulated insurance company or a regulated financial
institution or other Person generally recognized as an "institutional investor,"
in each case, that is engaged in the ordinary course of its business (directly
or through wholly-owned subsidiaries) in real estate investment activities, or
(b) a wholly-owned Subsidiary of any such insurance company or other financial
institution or institutional investor.
"Laws" means, collectively, all international, foreign, Federal, state
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and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by
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any Governmental Authority charged with the enforcement, interpretation or
administration thereof, and all applicable administrative orders, directed
duties, requests, licenses, authorizations and permits of, and agreements with,
any Governmental Authority, in each case whether or not having the force of law.
"Lending Office" means, as to any Bank or Designated Bid Lender, the
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office specified as its Lending Office on Schedule 1 or as such Person may
designate to Borrower and Administrative Agent.
"Letter of Credit Documents" has the meaning given to it in Section
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1.2(d).
"Letter of Credit Exposure" means, at any time, the aggregate amount
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remaining to be drawn under all outstanding Letters of Credit.
"Letter of Credit Obligations" mean, collectively, all reimbursement
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and other obligations of Borrower in respect of Letters of Credit.
"Letters of Credit" means the standby letters of credit issued from
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time to time by Administrative Agent, for the account of Borrower, pursuant to
Section 1.2(d), in each case, as the same may be drawn on, advanced, replaced or
modified from time to time.
"LIBOR Auction" means a solicitation of Competitive Bids setting forth
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LIBOR Bid Margins pursuant to Section 1.3(b).
"LIBOR Bid Loan" means a Bid Loan that bears interest at the relevant
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LIBOR Bid Margin above (or below, as the case may be) the LIBOR Rate (determined
as described in the definition of "LIBOR Bid Margin").
"LIBOR Bid Margin" means, in connection with any LIBOR Auction, a
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margin (expressed in multiples of 1/1000th of one basis point) above or below
the LIBOR Rate (determined, with respect to any LIBOR Bid Loan, in the same
manner as the LIBOR Rate is determined under the Note, except based on the
principal amount and Bid Loan Rate Period of the relevant LIBOR Bid Loan)
offered for any Bid Loan to be made pursuant thereto.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
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assignment, deposit arrangement, security interest, encumbrance, preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever, including without limitation any conditional sale or other
title retention agreement, the interest of a lessor under a capital lease, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement or document having similar
effect (other than a financing statement filed by a "true" lessor pursuant to
Section 9408 of the Uniform Commercial Code) naming the owner of the asset to
which such Lien relates as debtor, under the Uniform Commercial Code or other
comparable law of any jurisdiction.
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"Line of Credit" means the line of credit described in Section 1.1.
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"Liquidity Provider" means, for any Designated Bid Lender and at any
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time, on a collective basis, the financial institutions that at such date are
providing liquidity or credit support facilities to or for the account of such
Designated Bid Lender to fund such Designated Bid Lender's obligations hereunder
or to support the securities, if any, issued by such Designated Bid Lender to
fund such obligations.
"Loan" means, collectively, all Advances hereunder from time to time
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outstanding under the Line of Credit.
"Loan Documents" means this Agreement, the Note, each Guaranty, the
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Letter of Credit Documents, each Control Agreement and all other agreements,
instruments and documents (together with amendments and supplements thereto and
replacements thereof) now or hereafter executed by Borrower or any Guarantor
which evidence or support the obligations of Borrower in respect of the credit
facilities made available to Borrower pursuant hereto.
"Majority Banks" means, at any time, a Bank or Banks then having in
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excess of 66 2/3% of the Commitments (or, if the Commitments have been
terminated pursuant to the Loan Documents, holding in excess of 66 2/3% of the
then aggregate unpaid principal amount of the Advances, determined as if each
Designating Bank held (in addition to outstanding Committed Loans and Bid Loans
made for its own account) all outstanding Bid Loans made by its Designated Bid
Lender).
"Material Adverse Effect" means, with respect to a Person, a material
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adverse effect upon the condition (financial or otherwise), operations,
performance or properties of such Person or its ability to perform its
obligations under the Loan Documents. The phrase "has a Material Adverse
Effect" or "will result in a Material Adverse Effect" or words substantially
similar thereto shall in all cases be intended to mean "has resulted, or will or
could reasonably be anticipated to result, in a Material Adverse Effect", and
the phrase "has no (or does not have a) Material Adverse Effect" or "will not
result in a Material Adverse Effect" or words substantially similar thereto
shall in all cases be intended to mean "does not or will not or could not
reasonably be anticipated to result in a Material Adverse Effect".
"Material Borrower Entity" means a Borrower Entity as to which either
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of the following conditions exists: (i) Borrower's pro rata share of the
consolidated assets of such Person (as reflected on the GAAP-prepared financial
statements of such Borrower Entity) exceeds $30,000,000 at the end of any fiscal
quarter, with "pro rata" share being Borrower's effective percentage ownership
of such Person; or (ii) Borrower's pro rata share of such Person's consolidated
net income exceeds five percent (5%) of Borrower's consolidated net income for
the immediately preceding four fiscal quarters, determined in accordance with
GAAP.
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"Maturity Date" means (a) December 19, 2003, or (b) such earlier date
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upon which the Commitments may be terminated in accordance with the terms
hereof.
"Maximum Loan Amount" has the meaning ascribed to it in Section
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1.1(a).
"Net Offering Proceeds" means all cash proceeds received by Borrower
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as a result of the sale of common, preferred or other classes of stock in
Borrower (if and only to the extent reflected in stockholders' equity on the
consolidated balance sheet of Borrower prepared in accordance with GAAP), minus
(i) attorneys' fees and disbursements, (ii) accountants' fees, (iii)
underwriters' or placement agents' fees, discounts or commissions, (iv)
brokerage, consultants' and other fees, and (v) printing, registration and
related expenses, in each case, actually incurred in connection with such sale.
"Net Operating Income" means, at any time with respect to any real
--------------------
property asset, the cash-basis net operating income of such real property
determined on a basis consistent with the operating statements provided by
Borrower to Administrative Agent prior to the Effective Date, adjusted as
follows: (i) by deducting, in respect of capital reserves, on an annualized
basis: (a) $200 per apartment unit in the case of a real property asset
improved with an apartment project, and (b) in the case of any other real
property asset, $0.50 for each rentable square foot of the improvements thereon;
and (ii) by deducting (to the extent not already deducted in determining such
net operating income) actual management fees paid in respect of the management
of such real property asset for the period in question.
"Non-Recourse Indebtedness" means, with respect to any Person,
-------------------------
Indebtedness of that Person with respect to which recourse to such Person for
payment is contractually limited to specific assets encumbered by a Lien
securing such Indebtedness. Notwithstanding the foregoing, Indebtedness of any
Person shall not fail to constitute Non-Recourse Indebtedness by reason of the
inclusion in any document evidencing, governing, securing or otherwise relating
to such Indebtedness to the effect that such Person shall be liable, beyond the
assets securing such Indebtedness, for (i) misapplied moneys, including
insurance and condemnation proceeds and security deposits, (ii) liabilities
(including environmental liabilities) of the holders of such Indebtedness and
their affiliates to third parties, (iii) breaches of customary representations
and warranties given to the holders of such Indebtedness, (iv) commission of
waste with respect to any part of the collateral securing such Indebtedness, (v)
recovery of rents, profits or other income attributable to the collateral
securing such Indebtedness collected following a default, (vi) fraud, gross
negligence or willful misconduct, and (vii) breach of any covenants regarding
compliance with ERISA.
"Note" means the Promissory Note dated as of the date hereof executed
----
by Borrower in favor of Administrative Agent in the form of Exhibit B attached
hereto.
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"Obligations" means all advances, debts, liabilities, obligations and
-----------
covenants arising under any Loan Document owing by Borrower to any Bank or
Designated Bid Lender, Administrative Agent or any Indemnified Person, whether
absolute or contingent, due or to become due, now existing or hereafter arising.
"Other Unencumbered Property Owner" means any Borrower Entity or Joint
---------------------------------
Venture Entity, other than a Guarantor, that owns Unencumbered Real Property any
portion of the value of which is included in calculating Total Real Property
Market Value of Unencumbered Real Property.
"Person" means any natural person, employee, corporation, limited
------
partnership, general partnership, joint stock company, limited liability
company, joint venture, association, company, trust, bank, trust company, land
trust, business trust or other organization, whether or not a legal entity, or
any other non-governmental entity, or any Governmental Authority.
"Pro Rata Share" means, as to any Bank at any time, the percentage
--------------
equivalent (expressed as a decimal rounded to the twelfth decimal place) at such
time of such Bank's share of the Maximum Loan Amount.
"Prudential Indebtedness" means the unsecured Indebtedness of Borrower
-----------------------
to The Prudential Insurance Company of America in the original principal amount
of $73,000,000.
"Rating" means the rating of Borrower's senior long-term unsecured
------
debt obligations, as determined by one or more Rating Agencies. If two Ratings
are obtained by Borrower, then the lower Rating shall control for purposes of
determining the Applicable Margin; provided, however, that if the difference
between the two Ratings is greater than two levels, then Administrative Agent
shall reasonably determine the average of such Ratings, which shall control
(and, if such average is greater than one of the rating levels specified in the
foregoing table but less than the next higher rating level, the lower of the two
rating levels shall be deemed the average of the two Ratings for purposes of
determining the Applicable Margin). If three or more Ratings are obtained by
Borrower, then all but the two highest Ratings shall be disregarded, and the
Applicable Margin shall be determined in accordance with the preceding sentence
as if such two highest Ratings were the only two Ratings obtained. If Borrower
shall obtain a Rating from a Rating Agency other than Standard & Poor's
Corporation or Moody's Investor's Service, Inc., then Administrative Agent shall
reasonably determine the rating-level equivalents of such other Rating Agency
for purposes of determining the Applicable Margin in accordance with the matrix
set forth in the definition of Applicable Margin. Based on Borrower's current
Ratings, the Applicable Margin for the current calendar quarter is 0.70%.
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"Rating Agency" means each of Standard & Poor's Corporation, Moody's
-------------
Investor's Service, Inc., Duff and ▇▇▇▇▇▇ and Fitch Investors or such other
nationally recognized rating service or services as may be mutually agreed upon
by Borrower and Administrative Agent, with the consent of the Majority Banks.
"Real Property" means all improved, income-producing real property (i)
-------------
owned in fee entirely by Borrower or by a Controlled Borrower Entity or
Controlled Joint Venture Entity, and (ii) as to which at least eighty-five
percent (85%) of (a) the apartment units (in the case of real property improved
with an apartment project) or (b) the net rentable square footage of the
improvements thereon, in the case of all other real property, is occupied by
tenants, under written leases, who have commenced paying rent. Where a real
estate development project consisting of several buildings is under
construction, each building, as it is completed and satisfies the requirements
of the preceding clauses (i) and (ii), shall be treated as a separate "Real
Property" for purposes of this definition until such time as all of the
buildings included in that project have been completed. Upon completion, the
project shall be treated as a whole for purposes of determining whether it
qualifies as "Real Property."
"Reference Rate" means for any day a fluctuating rate per annum equal
--------------
to the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of
interest in effect for such day as publicly announced from time to time by BofA
as its "prime rate." Such rate is a rate set by BofA based upon various factors
including BofA 's costs and desired return, general economic conditions and
other factors, and is used as a reference point for pricing some loans, which
may be priced at, above, or below such announced rate. Any change in such rate
announced by BofA shall take effect at the opening of business on the day
specified in the public announcement of such change.
"Secured Indebtedness" means, without duplication, all Indebtedness,
--------------------
of Borrower or any Consolidated Borrower Entity or Consolidated Joint Venture
Entity, that is secured by a Lien on any real property asset.
"Subsidiary" of a Person means any other Person of which 50% or more
----------
of the voting stock, membership interests or other equity interests is owned or
controlled directly or indirectly by the Person, or one or more of the
Subsidiaries of the Person, or a combination thereof.
"Swing Line" has the meaning specified in Section 1.2(b).
----------
"Swing Line Availability Period" means the period commencing on the
------------------------------
Effective Date and ending on the earlier of (i) the last day of the Availability
Period, and (ii) the later of (A) such date as may be designated in a notice
delivered to Borrower by Administrative Agent upon the written instructions (or
with the written consent) of the Majority Banks, and (B) the date that is thirty
(30) days after the date upon which such
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notice becomes effective in accordance with the notice provisions of the Loan
Agreement.
"Swing Line Borrowing" means a Borrowing effected under the Swing
--------------------
Line.
"Swing Line Lender" means Administrative Agent acting in its capacity
-----------------
as the lender under the Swing Line, and any successor to Administrative Agent in
that capacity.
"Tangible Net Worth" means, at any time, (i) shareholders' equity, as
------------------
shown on Borrower's consolidated financial statements prepared in accordance
with GAAP, exclusive of minority interests, minus (ii) all Intangible Assets.
"Total Asset Value" means, at any time, the sum of (i) the aggregate
-----------------
value, using the Current Value Method, of all Real Property owned directly by
Borrower or by any Consolidated Borrower Entity or Consolidated Joint Venture
Entity, plus (ii) to the extent not in excess of 15% of Total Asset Value, the
book value (net of any applicable reserves) of all other tangible assets of
Borrower as shown on its most recent quarterly financial statements prepared on
a consolidated basis in accordance with GAAP.
"Total Liabilities" means (i) all Indebtedness of Borrower, whether or
-----------------
not such Indebtedness should be included as a liability on the balance sheet of
Borrower in accordance with GAAP, plus (ii) all other liabilities of every
nature and kind of Borrower that should be included as liabilities on the
balance sheet of Borrower in accordance with GAAP (other than minority
interests), in each case, determined on a consolidated basis.
"Total Real Property Market Value of Unencumbered Real Property"
--------------------------------------------------------------
means, at any time, the sum of (i) the aggregate value (as determined using the
Current Value Method) of all Unencumbered Real Properties owned directly by
Borrower or by any Controlled Borrower Entity that is a Guarantor, plus (ii) to
the extent that the aggregate contribution to Total Real Property Market Value
of Unencumbered Real Property of this clause (ii) is not in excess of 10% of
Total Real Property Market Value of Unencumbered Real Property, for each Other
Unencumbered Property Owner, Borrower's share of the aggregate value of all
Unencumbered Real Properties owned directly by such Person (as determined using
the Current Value Method).
"Unencumbered Real Property" means all Real Property as to which (i)
--------------------------
neither such Real Property, nor any interest in the Person owning such Real
Property, is subject to any Lien (other than Liens in respect of nondelinquent
real estate taxes or assessments) or to any agreement (other than this Agreement
or any other Loan Document, and including any provision of such Person's charter
documents) that (A) prohibits the creation of any Lien thereon as security for
Indebtedness of the Person owning such Real Property; or (B) limits the
Indebtedness owed to the Banks in respect of which such Real Property may be
encumbered to less than the full market value (determined using the Current
Value Method) of such Real Property; (ii) the Person owning such Real Property,
-15-
if a Borrower Entity or a Joint Venture Entity, has no Indebtedness other than
Unsecured Indebtedness permitted to exist under Section 6.4(j) (whether or not
such Person is a Guarantor); and (iii) no event described in Section 8.3 or
Section 8.4 has occurred and is continuing with respect to the Person that owns
such Real Property (and including, for purposes of this definition only, any
such event with respect to a Guarantor or Other Unencumbered Property Owner,
whether or not it is a Material Borrower Entity, other than a merger or
liquidation of a Guarantor or Other Unencumbered Property Owner into a Material
Borrower Entity or Borrower).
"Unsecured Indebtedness" means Indebtedness of Borrower not secured by a
----------------------
Lien, determined on a consolidated basis.
"Unsecured Interest Expense" means, for any period, the total interest
--------------------------
expense of Borrower with respect to Unsecured Indebtedness (whether paid,
accrued or capitalized (including the interest component of capital leases and
including interest-related costs such as amounts payable under interest rate
swaps, caps or other derivatives and loan fees, to the extent that such costs
are permitted to be amortized under GAAP, but excluding amounts, such as
prepayment premiums and breakage fees, that are not permitted to be amortized
under GAAP)) for such period, determined on a consolidated basis.
1. CREDIT FACILITIES AMOUNTS AND TERMS
1.1 Line of Credit Amount.
---------------------
(a) Line of Credit. During the Availability Period, the Banks will
--------------
provide a line of credit (the "Line of Credit"; also referred to as the "Loan")
to Borrower in accordance with the other provisions hereof. The amount of the
Line of Credit is Four Hundred Fifty Million Dollars ($450,000,000) (the
"Maximum Loan Amount"); provided that the Borrower shall have the right, (A) in
accordance with Section 1.1(b) below to increase the Maximum Loan Amount, and
(B) upon each August 1 following the Effective Date, to reduce the Maximum Loan
Amount by up to $250,000,000 in the aggregate, in increments of $10,000,000 or
integral multiples of $10,000,000. Each reduction under the preceding clause
(B) shall become effective on the date both of the following conditions have
been satisfied:
(i) Borrower shall have given at least ten (10) Business Days'
prior written notice to Administrative Agent irrevocably and
unconditionally reducing the Maximum Loan Amount, as of such August 1, in
an amount equal to $10,000,000 or an integral multiple of $10,000,000 (A)
that, together with all prior reductions in the Maximum Loan Amount, does
not exceed $250,000,000 and (B) that does not cause the Maximum Loan
Amount, as so reduced, to be less than twice the aggregate outstanding
principal amount of all Bid Loans having Bid Loan Rate Periods extending
beyond the proposed reduction date; and (C) that does not
-16-
cause the Maximum Loan Amount, as so reduced, to be less than the sum of
(1) the aggregate outstanding principal amount of all Bid Loans having Bid
Loan Rate Periods extending beyond the proposed reduction date, plus (2)
the Letter of Credit Exposure on the proposed reduction date; and
(ii) if the sum of (A) the aggregate principal balance of all
Advances under the Loan Documents then outstanding, plus (B) the Letter of
Credit Exposure, exceeds the Maximum Loan Amount as so reduced, Borrower
shall have made a voluntary prepayment of principal of the Advances in
accordance with the applicable provisions of the Note and the Loan
Documents, in an aggregate amount sufficient to reduce the sum of the
aggregate outstanding balance of the Advances, plus the Letter of Credit
Exposure, to such reduced amount of the Maximum Loan Amount or less,
together with accrued and unpaid interest on the amount of such prepayment
and any applicable "Prepayment Premium" payable under the Note or any other
Loan Documents.
No such reduction of the Maximum Loan Amount shall relieve Borrower of any
obligation in respect of any fees paid or accrued prior to the date of such
reduction. Upon the effectiveness of each such reduction, Borrower's right to
increase the Maximum Loan Amount shall expire and all references to the "Maximum
Loan Amount" shall be understood to mean and refer to a loan facility of an
amount equal to $450,000,000 (or such higher amount if the Maximum Loan Amount
has been previously increased under Section 1.1(b) below) less the aggregate
amount of the reductions in the Maximum Loan Amount that have been so effected
(including by reason of prior reductions, if any).
(b) Increase of Maximum Loan Amount. No later than 180 days prior
-------------------------------
to the Maturity Date and upon at least 15 days' prior written notice to
Administrative Agent (which notice shall be promptly transmitted by
Administrative Agent to each Bank and Designated Bid Lender), Borrower shall
have the right to increase the Maximum Loan Amount; provided that the ability of
Borrower to effect such increase shall be subject to syndication by Banc of
America Securities LLC and the following terms and conditions:
(i) such increase must be in a minimum amount of $20,000,000
and in integral multiples of $10,000,000 above the then existing Maximum
Loan Amount;
(ii) the Maximum Loan Amount may not be increased to an amount
greater than FIVE HUNDRED MILLION DOLLARS ($500,000,000);
(iii) any such increase in the Maximum Loan Amount shall be
applied, at the option of the Borrower, to (A) upon any existing Bank's
written consent, the Commitment of one or more existing Banks who have
given such consent or (B) one or more institutions that is not an existing
Bank (each, a "New Bank"); provided that each New Bank (x) is an Eligible
Assignee, (y) is acceptable
-17-
to Borrower and Administrative Agent and (z) becomes a Bank hereunder
pursuant to the execution and delivery of an appropriate joinder agreement
or of counterparts to this Loan Agreement in a manner acceptable to
Borrower and Administrative Agent;
(iv) if any Loans are outstanding at the time of the increase in
the Maximum Loan Amount, the Borrower shall, if applicable, prepay one or
more existing Loans (such prepayment to be subject to Section 1.5 and any
applicable "Prepayment Premium" payable under the Note or any other Loan
Document) in an amount necessary such that after giving effect to the
increase in the Maximum Loan Amount, each Bank will hold its Pro Rata Share
of outstanding Loans;
(v) Borrower shall execute and deliver such amendments to Loan
Documents and other documents and certificates, including, but not limited
to a new Note, in favor of Administrative Agent and any New Bank as are
reasonably necessary or as required by financial markets to effect such
increase; and
(vi) Schedule 1 shall be amended to reflect the revised
Commitment of the Banks.
(c) Revolving Credit. This is a revolving line of credit. During
----------------
the Availability Period, Borrower may from time to time repay principal amounts
(subject to the provisions of Exhibit B to the Note) and reborrow such
principal, subject to compliance with the terms and conditions of the Loan
Documents.
(d) Minimum Advance. Each Advance under the Line of Credit, other
---------------
than an Advance in respect of a draw under a Letter of Credit, must be for at
least Five Hundred Thousand Dollars ($500,000), or for the amount of the
remaining available Line of Credit if less.
(e) Limit. Borrower agrees not to permit the sum of the aggregate
-----
principal amount of all Advances under the Loan Documents outstanding at any
time, plus the Letter of Credit Exposure, to exceed the Maximum Loan Amount.
1.2 The Credit Facilities.
----------------------
(a) Line of Credit.
--------------
(i) Subject to the terms and conditions hereof, each Bank
severally agrees to fund its Pro Rata Share of each Committed Loan under
the Line of Credit from time to time during the Availability Period;
provided, however, that at no time shall the aggregate principal amount of
all Committed Loans then outstanding exceed the Committed Loan
Availability. The proceeds of each such Advance shall be delivered to
Borrower in accordance with the provisions of the Loan Documents.
-18-
(ii) Borrower and each Bank acknowledge that, as of the date
hereof the principal amount outstanding under the Existing Agreement is
$267,000,000 and such principal amount (as it may be changed between the
date hereof and the Effective Date) shall be repaid in accordance with
Section 4.1(g); and each Bank's Pro Rata Share and Commitment (by dollar
amount) are as as set forth below its name on the signature pages hereto.
(b) Swing Line Subfacility.
----------------------
(i) In addition to its other agreements with respect to the
making of Committed Loans, the Swing Line Lender additionally agrees, on
the terms and conditions of the Loan Documents (and subject to the Swing
Line Lender's discretion, as provided in Section 1.2(b)(ii)(B)), to make
Advances to Borrower from time to time, on a same-day basis, on Banking
Days during the Swing Line Availability Period that do not fall within the
last three (3) Business Days preceding a noticed reduction in the Maximum
Loan Amount pursuant to Section 1.1(a), in an aggregate principal amount
not exceeding at any one time the lesser of (A) the Committed Loan
Availability and (B) Fifty Million Dollars ($50,000,000) (the foregoing
subfacility, the "Swing Line"). The Swing Line Lender's obligation to fund
Swing Line Borrowings shall be unaffected by its making of any Committed
Loans or issuance of Letters of Credit, notwithstanding that the sum of the
Swing Line Borrowings plus the Swing Line Lender's Pro Rata Share of the
aggregate principal amount of the outstanding Committed Loans and Letter of
Credit Exposure, may exceed the Swing Line Lender's Commitment.
(ii) Procedure.
---------
(A) If Borrower desires to effect a Swing Line
Borrowing, Borrower shall deliver to Administrative Agent, no later than
11:00 a.m. (California time) on the proposed borrowing date, a Borrowing
Notice identifying the requested Borrowing as a Swing Line Borrowing and
otherwise complying with the provisions of the Loan Documents relating
generally to Borrowing Notices. Any Borrowing Notice received after 11:00
a.m. (California time) with respect to a requested Swing Line Borrowing
shall be deemed a request for a Swing Line Borrowing to be made on the next
Banking Day. Each Borrowing Notice requesting that a Swing Line Borrowing
be made shall also constitute a Borrowing Notice requesting that a
Committed Loan in the amount of the requested Swing Line Borrowing be made,
as a Committed Loan to bear interest at the Reference Rate, on the date
that is two (2) Banking Days after the date of such Swing Line Borrowing,
the proceeds of which shall be applied (if the requested Swing Line
Borrowing is made) to repayment of such Swing Line Borrowing. Each Swing
Line Borrowing, and each Committed Loan made pursuant to the related
Borrowing Notice, shall bear interest at the Reference Rate.
-19-
(B) If Administrative Agent, acting in its capacity as the
Swing Line Lender, elects, in its sole and absolute discretion, to make the
requested Swing Line Borrowing (but subject to the limits set forth in
Section 1.2(b)(i) and to the requirement that the requested Funding Date
fall within the Swing Line Availability Period but not within the last
three (3) Business Days preceding a noticed reduction in the Maximum Loan
Amount pursuant to Section 1.1(a)), and if all other conditions precedent
to the making of Committed Loans generally, are then satisfied,
Administrative Agent shall (a) notify Borrower that it has elected to make
the requested Swing Line Borrowing, and (b) disburse the proceeds of such
Swing Line Borrowing in accordance with provisions of this Agreement
generally applicable to the disbursement of Advances. The other Banks shall
have no obligation to fund their respective Pro Rata Shares of any Swing
Line Borrowing, and Administrative Agent alone (as the Swing Line Lender)
shall fund all Swing Line Borrowings.
(iii) Effect of Swing Line Borrowings on Obligations of Banks.
-------------------------------------------------------
(A) Each Bank shall (subject to the limitation that no Bank
shall be required to fund any Committed Loan that would cause its Committed
Loans, plus its Pro Rata Share of the Letter of Credit Exposure, to exceed
such Bank's Commitment), pay to the Swing Line Lender, on the date that is
two (2) Banking Days after the date of any Swing Line Borrowing, in
immediately available funds and otherwise as provided in the Loan Documents
or the Co-Lender Agreement (as defined below), as applicable, such Bank's
Pro Rata Share of the principal amount of such Swing Line Borrowing,
irrespective of the existence of any Event of Default or event that, with
the giving of notice or passage of time, or both, would constitute an Event
of Default, and without regard to whether or not on such date the other
conditions precedent to Committed Loans are satisfied. Upon such funding,
each Bank shall be deemed (1) if the conditions precedent to the making of
Committed Loans are in fact satisfied as of such date, to have made an
Advance to Borrower in a principal amount equal to such Bank's Pro Rata
Share of such Swing Line Borrowing, or (2) in any other event, to have
acquired from the Swing Line Lender (and the Swing Line Lender shall be
deemed to have assigned to each such Bank) a percentage interest in such
Swing Line Borrowing equal to such Bank's Pro Rata Share thereof. For
purposes of determining the availability of Swing Line Borrowings or
Committed Loans, such Swing Line Borrowing shall thereafter be deemed a
Committed Loan, and no longer a Swing Line Borrowing.
(B) Each Bank's obligation to fund (and, if applicable, to
purchase from the Swing Line Lender) its Pro Rata Share of a Swing Line
Borrowing pursuant to this Section 1.2(b) shall be absolute and
unconditional under any and all circumstances (including, without
limitation, irrespective of any
-20-
intervening bankruptcy of Borrower or acceleration of the Loan). It is not
the parties' intent that the obligations of the Banks under this Section
1.2(b) constitute guaranties or obligations of suretyship. If and to the
extent, however, that the obligations of any Bank under this Section 1.2(b)
are determined to be those of a guarantor or surety, such Bank, with full
knowledge of the consequences thereof, hereby expressly waives the benefit
of each and every right or defense of a guarantor or surety the effect of
which would relieve such Bank of all or any portion of its obligations
under this Section 1.2(b). In the event that any Bank fails to pay to the
Swing Line Lender when due any amount it is required to fund under this
Section 1.2(b), such Bank and Borrower severally agree to pay to
Administrative Agent, on demand, the amount such Bank has failed to so pay,
together with interest thereon for each day from the date on which such
payment was due until the date such amount is repaid to Administrative
Agent, at (1) in the case of Borrower, the Reference Rate, or (2) in the
case of such Bank, the Federal Funds Rate. Any such repayment by Borrower
shall be without prejudice to any rights it may have against the Bank that
has failed to pay when due any such amount.
(c) Bid Loan Facility.
-----------------
(i) In addition to its agreement to make Committed Loans
under the Line of Credit, each Bank severally agrees that, subject to the
conditions that at the time of Borrower's submission of the relevant
Competitive Bid Request (X) Borrower's Rating (as determined for purposes
of the definition of "Applicable Margin") is at least BBB/Baa2 or the
equivalent, and (Y) no Event of Default or event that, with the giving of
notice or the lapse of time, or both, has occurred and is continuing,
Borrower may, in accordance with this Section 1.2(c) and the other relevant
provisions of the Loan Documents, from time to time request that the Banks,
during the Availability Period, submit offers to make Bid Loans to
Borrower; provided, however, that the Banks may, but shall not be obligated
to, submit such offers, and Borrower may, but shall not be obligated to,
accept any such offers; and provided further that (A) at no time shall the
aggregate principal amount of all Advances (whether Committed Loans or Bid
Loans) at any time outstanding exceed the Maximum Loan Amount; (B) at no
time shall the aggregate principal amount of all Bid Loans exceed the Bid
Loan Facility Limit; and (C) at no time may the number of Bid Loan Rate
Periods then outstanding plus the number of Rate Periods for Committed
Loans then outstanding exceed twelve. The obligation of a Bank to fund its
Pro Rata Share of Committed Loans shall be unaffected by its (or its
Designated Bid Lender's) making of any Bid Loans, notwithstanding that the
sum of such Bank's Pro Rata Share of the aggregate principal amount of the
outstanding Committed Loans, plus the aggregate amount of such Bank's (and
its Designated Bid Lender's) outstanding Bid Loans, may exceed such Bank's
Commitment.
-21-
(ii) Each Bid Loan shall mature on the last day of the Bid Loan
Rate Period applicable thereto. On the last day of each Bid Loan Rate
Period, Borrower shall pay to Administrative Agent, for the respective
accounts of the Banks and Designated Bid Lenders making Bid Loans maturing
thereon, the full amount of the principal of, and accrued and unpaid
interest on, each Bid Loan ending thereon. Borrower's failure to pay such
amount in full on such date shall constitute an Event of Default without
notice or right to cure.
(d) Letters of Credit.
-----------------
(i) Subject to the terms and conditions set forth in this
Agreement, at any time and from time to time prior to the date that is six
(6) months prior to the then applicable Maturity Date, Administrative Agent
shall issue such Letters of Credit (or amend or otherwise modify an existing
Letter of Credit) for the account of Borrower as Borrower may request,
provided that (A) upon issuance of any such Letter of Credit: (1) the sum of
the aggregate outstanding principal amount of all Committed Loans plus the
Letter of Credit Exposure shall not exceed the Maximum Loan Amount less the
aggregate principal amount of all Bid Loans then outstanding; (2) the Letter
of Credit Exposure shall not exceed the lesser of (a) the Maximum Loan
Amount less the aggregate principal amount of all other Advances then
outstanding, and (b) $15,000,000; and (3) (a) the stated expiration date of
any Letter of Credit (including any automatic extension or renewal clause)
shall not be later than the earlier of (i) the Maturity Date, and (ii) the
date that is twelve (12) months after its date of issuance; and (b) no
Letter of Credit shall be issued for an initial face amount of less than
$500,000. Unless the context otherwise requires: (x) all references herein
to "the outstanding principal balance of the Committed Loans" or similar
references shall be deemed to include, for all purposes, the Letter of
Credit Exposure; and (y) each reference herein to a "Committed Loan" or an
"Advance" shall include both the issuance of a Letter of Credit and (except
with respect to conditions precedent to Advances) the payment of any draw
thereunder by Administrative Agent, as appropriate.
(ii) Borrower shall deliver to Administrative Agent a duly executed
request for Letter of Credit not later than 9:00 A.M. (San Francisco time),
at least three (3) Business Days prior to the date upon which the requested
Letter of Credit is to be issued. Borrower shall further execute and deliver
to Administrative Agent such additional instruments and documents as
Administrative Agent may require, in conformity with the then standard
practices of Administrative Agent's letter of credit department, in
connection with the issuance of such Letter of Credit (collectively, the
"Letter of Credit Documents").
(iii) Administrative Agent shall, if it approves of the content of
the request for a Letter of Credit, and subject to the conditions set forth
in Section 4.2, issue the Letter of Credit on or before 2:00 P.M. (San
Francisco time), on or before
-22-
the day three (3) Business Days following receipt of the documents last due
pursuant to the preceding paragraph (ii). Promptly following issuance of a
Letter of Credit, Administrative Agent shall deliver it to Borrower's
offices.
(iv) (A) If and to the extent that any amounts are drawn under
any Letter of Credit, the amount so drawn shall be considered a Committed
Loan for all purposes hereunder as of the date of such draw, the proceeds of
which were applied to reimburse Administrative Agent for the payment made by
it under the Letter of Credit and bearing interest at the Reference Rate.
Upon receipt by Administrative Agent of a draw request under any Letter of
Credit, Administrative Agent shall promptly notify Borrower, and each Bank,
of such drawing and of the date on which such drawing is proposed to be
paid, and (in the case of a notice to a Bank) of the amount (and such Bank's
Pro Rata Share) thereof. Each Bank shall (subject to the limitation that no
Bank shall be required to fund any Committed Loan that would cause its
Committed Loans, plus its Pro Rata Share of any remaining Letter of Credit
Exposure, to exceed such Bank's Commitment), pay to Administrative Agent, no
later than 11:00 A.M. (San Francisco time) on the date Administrative Agent
pays any draw under a Letter of Credit, in immediately available funds and
otherwise as provided in the Loan Documents or the Co-Lender Agreement, as
applicable, such Bank's Pro Rata Share of the principal amount of such
drawing, irrespective of the existence of any Event of Default or event
that, with the giving of notice or passage of time, or both, would
constitute an Event of Default, and without regard to whether or not on such
date the other conditions precedent to Committed Loans are satisfied. Upon
such funding, each Bank shall be deemed (1) if the conditions precedent to
the making of Committed Loans are in fact satisfied as of such date, to have
made an Advance to Borrower in a principal amount equal to such Bank's Pro
Rata Share of such drawing, or (2) in any other event, to have acquired from
Administrative Agent (and Administrative Agent shall be deemed to have
assigned to each such Bank) a percentage interest in such drawing equal to
such Bank's Pro Rata Share thereof. For purposes of determining the
availability of Letters of Credit or Committed Loans, such drawing shall
thereafter be deemed a Committed Loan, and no longer part of the Letter of
Credit Exposure.
(B) Each Bank's obligation to fund (and, if applicable, to
purchase from Administrative Agent) its Pro Rata Share of a drawing under a
Letter of Credit pursuant to this Section 1.2(d) shall be absolute and
unconditional under any and all circumstances (including, without limitation,
irrespective of any intervening bankruptcy of Borrower or acceleration of the
Loan). It is not the parties' intent that the obligations of the Banks under
this Section 1.2(d) constitute guaranties or obligations of suretyship. If and
to the extent, however, that the obligations of any Bank under this Section
1.2(d) are determined to be those of a guarantor or surety, such Bank, with full
knowledge of the consequences thereof, hereby expressly waives the benefit of
each and
-23-
every right or defense of a guarantor or surety the effect of which would
relieve such Bank of all or any portion of its obligations under this Section
1.2(d). In the event that any Bank fails to pay to Administrative Agent when due
any amount it is required to fund under this Section 1.2(d), such Bank and
Borrower severally agree to pay to Administrative Agent, on demand, the amount
such Bank has failed to so pay, together with interest thereon for each day from
the date on which such payment was due until the date such amount is repaid to
Administrative Agent, at (1) in the case of Borrower, the Reference Rate, or (2)
in the case of such Bank, the Federal Funds Rate. Any such repayment by Borrower
shall be without prejudice to any rights it may have against the Bank that has
failed to pay when due any such amount.
(v) (A) No later than the Maturity Date (or the earlier
acceleration of the Loan or termination of the Commitments prior to the
expiration of all Letters of Credit), Borrower shall immediately make
provision satisfactory to Administrative Agent for the full
collateralization, by cash or cash equivalent, of all such outstanding
Letters of Credit, such provision to include, but not be limited to, (1) the
deposit by Borrower with Administrative Agent of cash or cash equivalents,
in an amount equal to the aggregate Letter of Credit Exposure, to be held by
Administrative Agent as collateral for the Obligations of Borrower with
respect to the Letters of Credit, and (2) the execution and delivery by
Borrower of a Control Agreement with respect to such cash collateral.
(B) Upon the failure of Borrower to comply with the
requirements of the foregoing subparagraph (A), such portion of the Letter
of Credit Exposure as to which Borrower has failed to comply shall be
deemed to be immediately due and payable.
(vi) The issuance of any supplement, modification, amendment,
renewal or extension to or of any Letter of Credit shall be treated in all
respects the same as the issuance of a new Letter of Credit.
(vii) Borrower assumes all risks as to the acts or omissions of any
beneficiary or transferee of any Letter of Credit with respect to its use of
such Letter of Credit. Neither Administrative Agent nor any of its officers
or directors shall be liable or responsible for, nor shall Borrower's
obligations hereunder in respect of any Letter of Credit be impaired as a
result of:
(A) any lack of validity or enforceability of any Letter of
Credit or any Letter of Credit Document;
(B) the use that may be made of any Letter of Credit or any
acts or omissions of any beneficiary or transferee in connection therewith;
-24-
(C) any statement or any other document presented under a
Letter of Credit proving to be forged, fraudulent, invalid or insufficient
in any respect or any statement therein being untrue or inaccurate in any
respect;
(D) the existence of any claim, set-off, defense or other
right that Borrower may have at any time against any beneficiary or any
transferee of a Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), Administrative Agent or
any other Person, whether in connection with the transactions contemplated
by the Letter of Credit Documents or any unrelated transaction;
(E) payment by Administrative Agent against presentation of
documents that do not comply with the terms of a Letter of Credit,
including failure of any documents to bear any reference or adequate
reference to the Letter of Credit; or
(F) any other circumstance whatsoever in making or failing
to make payment under any Letter of Credit.
In furtherance and not in limitation of the foregoing, Administrative Agent may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary. Notwithstanding the foregoing, Borrower may have a
claim against Administrative Agent, and Administrative Agent may be liable to
Borrower, to the extent of any direct (as opposed to consequential or exemplary)
damages suffered by Borrower caused by Administrative Agent's willful misconduct
or gross negligence.
(e) Certain General Provisions.
--------------------------
(i) Each Bank acquiring an interest in the Committed Loans shall
become vested with its Pro Rata Share of Committed Loans upon execution and
delivery of the required documents and upon payment of its Pro Rata Share of
the principal balance of the outstanding Committed Loans and any other fees,
costs or expenses due hereunder or pursuant to another agreement. Upon such
payment, the respective interests of each Bank in the Loan Documents and the
other rights and claims with respect to the Line of Credit shall be of equal
priority with one another, except as otherwise expressly provided.
(ii) A complete set of Loan Documents shall be held by
Administrative Agent.
(iii) No Bank other than a Bank that is also Administrative
Agent, and no Designated Bid Lender, shall have any interest in any (A)
property taken as security for any other loan or financial accommodation
made or furnished to
-25-
Borrower by Administrative Agent (in which such Bank or Designated Bid
Lender has not acquired an interest); (B) property now or hereafter in
Administrative Agent's possession or under Administrative Agent's control
other than by reason of the Loan Documents; or (C) deposits which may be or
might become security for Borrower's Obligations by reason of the general
description contained in any instrument not a Loan Document held by
Administrative Agent or by reason of any right of setoff, counterclaim,
banker's lien or otherwise. If, however, such property shall actually be
applied to the payment of amounts owing by Borrower in connection with the
Advances, then each Bank and Designated Bid Lender shall be entitled to a
pro rata share, if any, of such application to amounts due in connection
with the Advances, based on the ratio of the outstanding principal amount of
all Advances made by such Bank (whether under the Line of Credit or the Bid
Loan Facility) or Designated Bid Lender to the outstanding principal amount
of all Advances.
(iv) All the parties agree that, except as may be otherwise
expressly provided, all of the interest rates for the Advances are those of
and are calculated in accordance with the requirements and any applicable
assessments of Administrative Agent, regardless of which Bank or Designated
Bid Lender is making an Advance or receiving a payment thereon.
(v) If, at any time or for any reason whatsoever, (A) the sum
of the aggregate principal amount of all outstanding Committed Loans shall
exceed the Committed Loan Availability, or (B) the aggregate amount of all
outstanding Bid Loans shall exceed the Bid Loan Facility Limit, or (C) the
aggregate amount of all outstanding Advances (whether Committed Loans or Bid
Loans), plus the Letter of Credit Exposure, shall exceed the Maximum Loan
Amount, then Borrower shall immediately pay to the Banks (for their own
account and for the accounts of their respective Designated Bid Lenders, as
applicable, to be applied to repayment of the affected Advances in such
order as Administrative Agent may determine, in its sole discretion), the
amount of such excess (or, if less, the outstanding principal of all
affected Advances).
1.3 Procedure for Borrowing.
------------------------
(a) Committed Loans.
---------------
(i) Each Borrowing under the Line of Credit shall be made upon
Borrower's irrevocable written notice delivered to Administrative Agent in
accordance with Section 3.1.
(ii) Administrative Agent will promptly notify each Bank of (A)
any election of a LIBOR Alternative Rate (as defined in the Note) by
Borrower pursuant to the provisions of Exhibit A to the Note and of the
amount of such
-26-
Bank's Pro Rata Share of the principal of the Loan with respect to which
such election has been made, and (B) any Notice of Borrowing and of the
amount of such Bank's Pro Rata Share of that Borrowing. With respect to a
Notice of Borrowing, the Banks, acting through Administrative Agent, shall
disburse the requested Advance as provided in the Loan Agreement.
(b) Bid Loans.
---------
(i) When Borrower desires to effect a Borrowing (or Borrowings)
consisting of one or more Bid Loans, but not more often than twice in any
calendar month, Borrower shall notify Administrative Agent by telephone,
followed promptly by facsimile of a Competitive Bid Request in the form of
Exhibit C (to be received no later than 10:00 a.m., San Francisco time, (x)
in the case of a LIBOR Auction, four Banking Days prior to the date of the
proposed Borrowing(s), or (y) in the case of an Absolute Rate Auction, two
Banking Days prior to the date of the proposed Borrowing(s)), specifying
(among the other information required by Exhibit C):
(A) the date of such Borrowing(s), which shall be a Banking
Day;
(B) the aggregate amount of such Borrowing(s), which shall be
in an amount (subject to the limitations set forth in other provisions of
the Loan Documents) equal to $10,000,000 or an integral multiple of
$1,000,000 in excess thereof;
(C) whether the requested Borrowing(s) is/are to be made as
either (1) one or more LIBOR Bid Loans or (2) one or more Absolute Rate Bid
Loans; and
(D) the duration of the requested Bid Loan Rate Period
(subject to the limitations that Borrower may request no more than three Bid
Loan Rate Periods in any single Competitive Bid Request and that each Bid
Loan Rate Period must relate to at least $5,000,000 in principal) and, if
more than one Bid Loan Rate Period is requested, the requested principal
amount of the related Borrowing.
Borrower's right to request Competitive Bids for LIBOR Bid Loans, and each
Bank's or Designated Bid Lender's obligation to fund any LIBOR Bid Loan pursuant
to any Competitive Bid accepted by Borrower, shall be subject in all respects to
the provisions of Section 2.2(d) of Exhibit A to the Note, applied as if each
reference therein to the "LIBOR Alternative" referred as well to LIBOR Bid
Loans.
-27-
(ii) Upon receipt of a Competitive Bid Request, Administrative
Agent shall promptly send a copy thereof to each of the Banks by facsimile,
attaching thereto notice of the date and time by which responses must be
received in order to be considered by Borrower. The Competitive Bid Request
shall not constitute an offer by Borrower, but merely an invitation to the
Banks to submit Competitive Bids with respect to the requested Borrowing(s).
(iii) (A) Each Bank may, in its discretion, submit a Competitive
Bid containing an offer or offers to make Bid Loans in response to any
Competitive Bid Request. Each Competitive Bid must comply with the
provisions of this Section 1.3(b)(iii) and must be submitted to
Administrative Agent (or, in the case of a Competitive Bid being submitted
by Administrative Agent in its capacity as a Bank, to Borrower), by
facsimile, no later than 9:00 a.m. (or, in the case of a Competitive Bid by
Administrative Agent, 8:45 a.m.), San Francisco time, (1) in the case of a
LIBOR Auction, three Banking Days prior to the date of the proposed
Borrowing(s), or (2) in the case of an Absolute Rate Auction, on the date of
the proposed Borrowing(s). Each Competitive Bid so submitted (subject only
to the provisions of Section 2.2(d) of Exhibit A to the Note, as described
above, and to the satisfaction of all conditions precedent to the requested
Advance) shall be irrevocable, unless Borrower otherwise agrees in writing.
(B) Each Competitive Bid shall be in substantially the
form of Exhibit D hereto, shall identify the submitting Bank and the date
of the proposed Borrowing(s) specified in the Competitive Bid Request to
which the submitting Bank is responding and shall specify:
(1) the principal amount of each Bid Loan for which
the Competitive Bid is being made (which shall not be limited by the submitting
Bank's Commitment, but which shall be in an amount, no greater than the amount
of the requested Borrowing, equal to $5,000,000 or an integral multiple of
$1,000,000 in excess thereof); and
(2) (a) in the case of a LIBOR Auction, the LIBOR
Bid Margin offered by the submitting Bank, or (b) in the case of an Absolute
Rate Auction, the Absolute Rate offered by the submitting Bank.
A Competitive Bid may include up to three separate offers by the submitting Bank
with respect to each Bid Loan Rate Period specified in the Competitive Bid
Request to which it responds. Any Competitive Bid that (X) does not include all
the information required by this Section 1.3(b)(iii)(B), (Y) contains language
that qualifies or conditions the submitting Bank's offer to make the Bid Loan(s)
described therein or proposes terms other than (or in addition to) the terms
proposed in the relevant Competitive Bid Request other than to set an aggregate
limit on the principal amount of Bid Loans for which offers being made by the
submitting Bank may be accepted, or (Z) is received by
-28-
Administrative Agent (or Borrower, as applicable) after the time set forth in
Section 1.3(b)(ii)(A) (unless amended to bring it into compliance prior to the
time set forth in Section 1.3(b)(ii)(A)), shall be disregarded.
(iv) Promptly upon receipt, but not later than 10:00 a.m. on the
date by which Competitive Bids are required to have been submitted with
respect to a Competitive Bid Request, Administrative Agent shall notify
Borrower of (A) the terms of each Competitive Bid (other than one that is to
be disregarded as described above) received in response to the Competitive
Bid Request, and (B) (1) the aggregate principal amount of Bid Loans for
which Competitive Bids have been received for each Rate Period requested in
the Competitive Bid Request, and (2) the respective principal amounts and
LIBOR Bid Margins or Absolute Rates, as the case may be, so offered.
(v) No later than 10:30 a.m. on the date by which Competitive
Bids are required to have been submitted with respect to a Competitive Bid
Request, Borrower shall notify Administrative Agent of its acceptance or
rejection of the offers notified to it as provided in Section 1.3(b)(iv).
Borrower shall have no obligation to accept any such offer, and may choose
to reject all of them. If Borrower has failed to timely notify
Administrative Agent of its acceptance or rejection of any one or more
offers by the time specified in the preceding sentence, Borrower shall be
deemed to have rejected such offer(s). Borrower may accept any Competitive
Bid (other than one that is to be disregarded as provided above) in whole or
in part, provided that:
(A) the aggregate principal amount of the Competitive Bids
so accepted may not exceed the aggregate amount of the Borrowing(s)
requested in the relevant Competitive Bid Request;
(B) (1) subject to the provisions set forth below with
respect to multiple offers at the same LIBOR Bid Margin or Absolute Rate,
the principal amount of each accepted Competitive Bid must be in an amount
equal to $5,000,000 or an integral multiple of $1,000,000 in excess
thereof, and (2) Competitive Bids must be accepted with respect to an
aggregate principal amount of at least $10,000,000; and
(C) with respect to each Bid Loan Rate Period for which
Competitive Bids were requested, Borrower may accept offers solely on the
basis of ascending LIBOR Bid Margins or Absolute Rates, as the case may be
(provided that Borrower may, to the extent necessary to comply with the
preceding paragraph (B) or to accept offers in an aggregate principal
amount equal to the aggregate amount of the Borrowing(s) requested in the
relevant Competitive Bid Request, accept only part of an offer at a
particular LIBOR Bid Margin or
-29-
Absolute Rate and accept all or part of one or more offers at a higher
LIBOR Bid Margin or Absolute Rate).
If Borrower chooses to accept one or more offers, Borrower's notice to
Administrative Agent shall specify the aggregate principal amount of offers with
respect to each requested Bid Loan Rate Period that it chooses to accept. If two
or more Banks offer the same LIBOR Bid Margin or Absolute Rate for an aggregate
principal amount greater than the amount for which such offers were requested
with respect to any requested Bid Loan Rate Period, then, notwithstanding that
in all other cases no Bid Loan may be made in an amount less than $5,000,000,
Administrative Agent shall allocate the principal amount of the affected Bid
Loan among such Banks as nearly as possible (in such multiples, not less than
$1,000,000, as Administrative Agent may deem appropriate) in proportion to the
aggregate principal amounts to which their respective offers related.
Administrative Agent's allocation, in the absence of manifest error, shall be
conclusive.
(vi) Administrative Agent shall promptly notify each Bank having
submitted a Competitive Bid whether its offer has been accepted and, if its
offer has been accepted, of the amount of the Bid Loan(s) to be made by it
(or its Designated Bid Lender) on the date of the relevant Borrowing(s).
Each Bid Loan shall bear interest, from and including the date it is made to
but excluding the last day of the Bid Loan Rate Period applicable thereto,
at a rate per annum equal to (A) in the case of an Absolute Rate Bid Loan,
the Absolute Rate specified by the Bank making (or whose Designated Bid
Lender makes) such Absolute Rate Bid Loan in its accepted Competitive Bid,
and (B) in the case of a LIBOR Bid Loan, the sum of (1) the LIBOR Bid Margin
specified by the Bank making (or whose Designated Bid Lender makes) such
LIBOR Bid Loan in its accepted Competitive Bid, plus (2) the LIBOR Rate
(determined in the same manner as the LIBOR Rate is determined under the
Note, except based on the principal amount and Bid Loan Rate Period of such
LIBOR Bid Loan).
(vii) Upon the request of any Bank, Administrative Agent shall
notify such Bank, following a Borrowing of one or more Bid Loans, of the
ranges of bids submitted and the highest and lowest bids accepted for each
Bid Loan Rate Period requested by Borrower and of the aggregate amount of
the Bid Loans made pursuant to such Borrowing. From time to time, Borrower
and the Banks (for themselves and for their respective Designated Bid
Lenders) shall furnish such information to Administrative Agent as
Administrative Agent may reasonably request relating to the Bid Loans,
including the amounts, interest rates, dates of Borrowing and last days of
the applicable Bid Loan Rate Periods, for the purpose of enabling
Administrative Agent to allocate amounts received from Borrower to payment
of amounts due and owing under the Loan Documents.
(viii) All notices or other communications required or desired to
be delivered by Borrower pursuant to this Section 1.3(b) shall be given by
an
-30-
individual authorized to do so pursuant to Section 3.9 of Exhibit A to the
Note in a writing delivered to Administrative Agent by Borrower pursuant
thereto.
(ix) Any Bid Loan that would otherwise be made by a Bank that is
a Designating Bank may from time to time be made by its Designated Bid
Lender, in such Designated Bid Lender's sole discretion. Nothing herein
shall constitute a commitment to make Bid Loans by such Designated Bid
Lender; provided, however, if such Designating Bank's Designated Bid Lender
elects not to, or fails to, make any such Bid Loan, for any reason
whatsoever, such Designating Bank shall make such Bid Loan pursuant to the
terms hereof, it being the obligation of each Designating Bank to make each
Bid Loan with respect to a Competitive Bid submitted by such Designating
Bank and accepted by Borrower, in whole or in part, pursuant hereto, except
to the extent that such Bid Loan is in fact funded by its Designated Bid
Lender.
(c) Certain General Provisions.
--------------------------
(i) Each Bank shall make the aggregate amount of its Pro Rata
Share of each Committed Loan,
(ii) each Bank having a Competitive Bid accepted will make the
aggregate amount of the Bid Loan(s) with respect to which its Competitive
Bid was accepted, and
(iii) each Designated Bid Lender electing to fund one or more Bid
Loans that would otherwise have been made by its Designating Bank with
respect to an accepted Competitive Bid (or, if such Designated Bid Lender
fails to do so, its Designating Bank) will make the aggregate amount of such
Bid Loan(s), available to Administrative Agent for the account of Borrower
at Administrative Agent's Office by 11:00 a.m. (San Francisco time) on the
date of the relevant Borrowing and in funds immediately available to
Administrative Agent. The proceeds of all such Advances will then be made
available to Borrower by Administrative Agent by wire transfer in accordance
with written instructions provided to Administrative Agent by Borrower. If
any Bid Loan is funded by a Designated Bid Lender, its Designating Bank
shall provide Administrative Agent with notice to that effect on the date of
such Borrowing.
(iv) Unless Administrative Agent receives notice from any Bank
at least one Banking Day prior to the date of a Borrowing that such Bank (or
such Bank's Designated Bid Lender, in the case of a Bid Loan) will not make
available to Administrative Agent when required (A) its Pro Rata Share of
the Committed Loan to be made thereon, or (B) the amount of the Bid Loans to
be made by such Bank (or its Designated Bid Lender) thereon, as the case may
be, Administrative Agent may assume that such Bank (or, if applicable, its
Designated Bid Lender) has
-31-
made such amount available to Administrative Agent in immediately available
funds on the date of such Borrowing.
(v) The failure of any Bank or Designated Bid Lender to make
available to Administrative Agent any amount it is required to make so
available in respect of any Borrowing shall not relieve any other Bank or
Designated Bid Lender of any obligation hereunder to make an Advance on the
date of such Borrowing, but, except to the extent expressly provided (A) in
Section 1.3(b)(ix) with respect to the obligation of any Designating Bank to
fund Bid Loans that are not funded by its Designated Bid Lender or (B) in
Section 11.5(b), no Bank or Designated Bid Lender shall be responsible for
the failure of any other Bank or Designated Bid Lender to make any amount so
available.
1.4 Interest Rates.
---------------
(a) The Note sets forth certain provisions regarding the interest
rates and certain other terms and conditions applicable to the credit facilities
provided pursuant to the Loan Documents. Borrower may elect interest rates
applicable to the Committed Loans in accordance with the requirements, terms and
conditions set forth in the Note upon irrevocable written notice to
Administrative Agent to be received by Administrative Agent on the appropriate
day not later than 9:30 a.m. (San Francisco time). Interest rates applicable to
Bid Loans are subject to the provisions of Section 1.3(b)(vi).
(b) Administrative Agent will promptly notify each Bank of receipt of
an election of the Contract Rate (as defined in the Note). If no timely notice
is provided by Borrower, Administrative Agent will promptly notify each Bank of
any automatic conversion to the Reference Rate. All rate elections and
conversions with respect to Committed Loans shall be made ratably according to
the respective outstanding principal amounts of the Committed Loan held by each
Bank with respect to which the notice was given.
1.5 Prepayments.
------------
(a) In the event Borrower elects to prepay the Committed Loans in
whole or in part in accordance with the Loan Documents, Administrative Agent
will promptly notify each Bank of such notice and of each Bank's Pro Rata Share
of such prepayment.
(b) Notwithstanding any other provision of this Agreement or of any
other Loan Document, Borrower shall have no right to prepay any Bid Loan prior
to the last day of the applicable Bid Loan Rate Period.
(c) In the event of any prepayment by Borrower of a Bid Loan prior to
the last day of the Bid Loan Rate Period applicable thereto (by reason of
acceleration or for any other reason), Borrower shall pay to each Bank holding
an interest therein, or whose
-32-
Designated Bid Lender holds an interest therein, a prepayment premium equal to
the sum of
(i) $250; and
(ii) the sum of such losses and expenses as such Bank or its
Designated Bid Lender, as applicable, may incur by reason of such
prepayment, including without limitation any losses or expenses incurred in
obtaining, liquidating or employing deposits from third parties, but
excluding loss of margin for the period after such prepayment.
The prepayment premium provided for herein shall be due and payable not later
than fifteen (15) days after delivery to Borrower, by or on behalf of the
affected Bank or Designated Bid Lender, of a demand for payment accompanied by a
calculation, in reasonable detail, of such losses and expenses, which shall be
conclusive in the absence of manifest error.
(d) Each of the waivers and acknowledgments of Borrower set forth in
Paragraphs 4 and 5 of Exhibit B to the Note shall apply to Borrower's covenants
set forth in this Section 1.5 as if set forth herein.
1.6 Usury.
-----
If a court ultimately determines that the Loan (or any Advance) violates
applicable usury law, then (a) Borrower shall not be required to pay to or for
the account of any Bank or Designated Bid Lender interest on the Loan (or such
Advance) at a rate in excess of the maximum rate that may be lawfully charged
under applicable law; and (b) in the event that any Bank or Designated Bid
Lender shall collect interest or other monies which are deemed to constitute
interest which would increase the effective interest rate on the Loan (or any
Advance) to a rate in excess of that permitted by applicable law, such excess
interest shall, at the option of said Bank or Designated Bid Lender, be returned
to Borrower or credited against the principal balance of the Loan (or such
Advance) then outstanding; (c) provided, however, that if a usury law applies to
one or more but not all Banks and Designated Bid Lenders, then the Banks and
Designated Bid Lenders not affected by the usury law shall be entitled to the
full amount of interest from Borrower under the Loan Documents even though other
Banks or Designated Bid Lenders may receive or retain less due to the usury law.
1.7 Increased Costs and Reduction of Return.
----------------------------------------
If any Bank shall have determined that a change in or compliance with any
Capital Adequacy Regulation affects the amount of capital required to be
maintained by the Bank, or by any Person controlling the Bank, and such Bank
determines that the amount of such required capital is increased as a
consequence of the Line of Credit or other
-33-
obligations under the Loan Documents taking into consideration such Bank's or
controlling Person's policies with respect to capital adequacy and desired
return on capital, then, upon demand of such Bank to Borrower through
Administrative Agent, Borrower shall pay to the Bank an additional amount
sufficient to compensate the Bank for such increase.
2. FEES, EXPENSES
2.1 Fees; Indemnities.
------------------
(a) Facility Fee. Borrower agrees to pay, in quarterly installments,
------------
in arrears, a facility fee in an amount equal to one quarter of the Applicable
Facility Fee Percentage of the daily average Maximum Loan Amount in effect
during the immediately preceding calendar quarter during the term hereof and as
of the last day of the Availability Period (prorated for partial quarters on the
basis of a year of 360 days for the actual number of days elapsed). This fee
shall be due and payable not later than fifteen (15) days following the
rendering of an invoice therefor by Administrative Agent.
(b) Letter of Credit Fees. As additional consideration for the
---------------------
issuance, extension or renewal of Letters of Credit pursuant to Section 1.2(d),
Borrower agrees to pay to Administrative Agent, for the ratable account of the
Banks, a Letter of Credit fee equal to (i) the Applicable Margin times (ii) the
face amount of such Letter of Credit, payable upon issuance (and, in the event
of any extension or renewal of a Letter of Credit, upon such extension or
renewal), pro rated for periods of less than twelve months on the basis of a
year of 360 days and for the actual number of days elapsed. In addition,
Borrower shall pay Administrative Agent an issuing fee in the amount of $150 and
any other fees related to processing, administration, transfer and amendment of
standby letters of credit.
(c) Administrative Fee. Borrower shall pay an administrative fee to
------------------
Administrative Agent for Administrative Agent's own account, as set forth in a
separate letter of understanding between Administrative Agent and Borrower.
(d) Auction Fee. Together with Borrower's submission of each
-----------
Competitive Bid Request, Borrower shall pay to Administrative Agent an auction
fee in the amount of $2,500, which fee shall be fully earned and nonrefundable
upon Administrative Agent's transmittal of the Competitive Bid Request to the
Banks, regardless of whether the request is subsequently cancelled by Borrower,
any Bid Loans are made by any Bank or Designated Bid Lender in response thereto
or any Competitive Bids are accepted by Borrower.
(e) Other Fees. Borrower shall pay to Administrative Agent, for
----------
Administrative Agent's own account, a commitment fee and arrangement fee as set
forth in a separate letter understanding between Borrower and Administrative
Agent.
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2.2 Costs and Expenses.
-------------------
Borrower shall:
(a) pay or reimburse Administrative Agent within five Banking Days
after demand for all costs and expenses (including legal fees) incurred by it in
connection with the preparation, due diligence, administration, syndication and
execution of any Loan Document and any amendment, supplement, waiver or
modification and any other documents prepared in connection herewith or
therewith, (whether or not the particular Loan, transaction or document is
consummated), including reasonable legal fees incurred by BofA (including as
Administrative Agent) with respect thereto; and
(b) pay or reimburse Administrative Agent and each Bank within five
Banking Days after demand for all costs and expenses (including legal fees)
incurred by them in connection with the enforcement or preservation of any
rights or remedies under any Loan Document with respect to an Event of Default
(including any "workout" or restructuring of all or any portion of the
Obligations, any proceeding described in Section 8.3 and 8.4 ("Insolvency
Proceeding"), and any other judicial proceeding or arbitration).
2.3 Indemnification by Borrower.
----------------------------
(a) Borrower shall indemnify, defend and hold Administrative Agent-
Related Persons and each Bank, and each of their respective officers, directors,
employees and agents (each, an "Indemnified Person") harmless from and against:
(i) any and all liabilities, obligations, losses, damages,
actions, judgments, costs and expenses (including legal fees) which may be
incurred by or asserted against any such Person arising out of or relating
to (A) the Line of Credit, the Bid Loan Facility, Advances under the Loan
Documents, Letters of Credit or the Loan Documents or any document or
transaction or action taken or not by any such Person in connection with any
of the foregoing, including but not limited to the execution, delivery,
enforcement, performance and administration of this Agreement and the other
Loan Documents, or (B) the transactions contemplated hereby, including any
investigation, arbitration, litigation, Insolvency Proceeding or other
proceeding thereto related to this Agreement or the other Loan Documents,
the Line of Credit, the Bid Loan Facility, Letters of Credit, Advances under
the Loan Documents or the use of the proceeds thereof (including, without
limitation, any investigation, litigation or proceeding related to the
acquisition by any Borrower Entity or Joint Venture Entity of all or any
portion of its assets), whether or not any Indemnified Person is a party;
and
(ii) any and all writs, subpoenas, claims, demands, actions, or
causes of action that are served on or asserted against any Indemnified
Person (if directly or indirectly related to a writ, subpoena, claim,
demand, action, or cause of
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action against Borrower or any Affiliate of Borrower); and any and all
liabilities, losses, costs, or expenses (including attorneys' fees) that any
Indemnified Person suffers or incurs as a result of any of said matters;
(all the foregoing, collectively, the "Indemnified Liabilities"); provided, that
Borrower shall have no obligation hereunder to any Indemnified Person with
respect to Indemnified Liabilities resulting solely from the gross negligence or
willful misconduct of such Indemnified Person; nor shall Borrower have any
obligation to indemnify any Designating Bank in respect of any matter with
respect to which Borrower is entitled to be indemnified pursuant to Section 11.5
or in respect of any act or omission by such Designating Bank or its Designated
Bid Lender under their Designation Agreement or any other agreement entered into
between them in connection therewith.
(b) Borrower shall further indemnify Administrative Agent, each Bank
and each Designated Bid Lender from and hold it harmless against any transfer or
documentary taxes, assessments or charges imposed by any governmental authority
by reason of the execution, delivery and performance of the Loan Documents.
(c) Borrower's obligations under this Section 2.3 shall survive
payment of all other Obligations, and shall inure to the benefit of
Administrative Agent's, Banks' and Designated Bid Lenders' successors and
assigns.
3. DISBURSEMENTS AND PAYMENTS
3.1 Requests for Credit.
--------------------
(a) Each request for an extension of credit shall be made in writing
in a manner acceptable to Administrative Agent.
(b) Borrowing Notice. Except as otherwise provided in the Loan
----------------
Documents, each draw request shall be made upon the irrevocable written notice
of Borrower (including notice via facsimile confirmed by a mailed copy) pursuant
to a Borrowing Notice in the form attached hereto as Exhibit A ("Borrowing
Notice"). Each Borrowing Notice shall be submitted to and received by the Bank
prior to 9:00 a.m. (California time) at least two (2) Banking Days prior to the
specified borrowing date. The truth and accuracy of each statement made in the
Borrowing Notice shall be a condition precedent to the Advance requested
thereunder.
3.2 Disbursement and Payment Record; Loan Account.
---------------------------------------------
Each disbursement by Administrative Agent, and each payment by
Borrower, shall be evidenced by records kept by Administrative Agent. The
Advances made by each Bank or Designated Bid Lender shall be evidenced by one or
more loan accounts or records maintained by such Bank, Designated Bid Lender
(and its Designating Bank) or Administrative Agent, as the case may be, in the
ordinary course of
-36-
business. The loan accounts or records maintained by Administrative Agent and
each Bank or Designated Bid Lender (and its Designating Bank) shall be
conclusive absent manifest error of the amount of the Advances made by the Banks
or Designated Bid Lenders to Borrower and the interest and payments thereon. Any
failure so to record or any error in doing so shall not, however, limit or
otherwise affect the obligation of Borrower hereunder to pay any amount owing
with respect to Advances made under the Loan Documents.
3.3 Authorization.
--------------
(a) Administrative Agent may honor facsimile instructions for
advances or repayments (or for the designation of any optional interest rates
that may be permitted by the Note) given by any one of the individuals
authorized to sign loan documents on behalf of Borrower, or any other individual
designated by any one of such authorized signers.
(b) Advances will be deposited in Borrower's account number 00333-
10805 maintained with Administrative Agent, or such other of Borrower's accounts
with Administrative Agent as designated in writing by Borrower.
(c) Borrower indemnifies and releases Administrative Agent and each
Bank and Designated Bid Lender (including, in each case, its officers,
employees, and agents) from all liability, loss, and costs in connection with
any act resulting from written instructions any such Person reasonably believes
are made by any individual authorized by Borrower to give such instructions.
This indemnity and release shall survive this Agreement's termination.
3.4 Banking Days.
-------------
All payments and disbursements which would be due on a day which is not a
Banking Day will be due on the next Banking Day. All payments received on a day
which is not a Banking Day will be applied to amounts due under the Loan
Documents on the next Banking Day.
3.5 Payments.
---------
(a) All payments to be made by Borrower shall be made without set-
off, recoupment or counterclaim. Except as otherwise provided, all payments by
Borrower shall be made to Administrative Agent for the account of the Banks and
the Designated Bid Lenders, as applicable, at Administrative Agent's Office, and
shall be made in Dollars and in immediately available funds, in accordance with
the Loan Documents. Administrative Agent will promptly distribute to each Bank
(including, to the extent applicable, for the account of its Designated Bid
Lender, in accordance with Section 11.5), in like funds as received: (i) its Pro
Rata Share (or other applicable share as may
-37-
be agreed by a Bank) of each payment in respect of the Line of Credit and (ii)
its (or, if applicable, its Designated Bid Lender's) pro rata share of each
payment in respect of any one or more Bid Loans (based on the proportion of the
outstanding principal amount of such Bank's (or Designated Bid Lender's) Bid
Loans in respect of which such payment is made to all the outstanding principal
amount of all Bid Loans in respect of which such payment is made); provided that
if any payment is received or otherwise realized by Administrative Agent at a
time when the Availability Period has ended and all outstanding Advances have
become, or have been declared, due and payable, then Administrative Agent shall
distribute to each Bank (including, to the extent applicable, for the account of
its Designated Bid Lender, in accordance with Section 11.5) its (or its
Designated Bid Lender's) pro rata share thereof, based on the proportion of the
aggregate principal amount of such Bank's (or its Designated Bid Lender's)
outstanding Advances to the aggregate principal amount of all outstanding
Advances. Any payment received by Administrative Agent later than 11:00 a.m.
(San Francisco time) shall be deemed to have been received on the following
Banking Day and any applicable interest or fee shall continue to accrue.
(b) To the extent that Borrower makes a payment to Administrative
Agent or the Banks or Designated Bid Lenders, or Administrative Agent or
(notwithstanding any provision of the Co-Lender Agreement to the contrary) the
Banks exercise the right of set-off, and such payment or the proceeds of such
set-off or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including by any settlement)
to be repaid to a trustee, receiver, Borrower or any other party, in connection
with any Insolvency Proceeding or otherwise, then (i) to the extent of such
recovery the obligation or part thereof originally intended to be satisfied
shall be revived and continued in full force and effect as if such payment had
not been made or such set-off had not occurred; and (ii) each Bank severally
agrees to pay to Administrative Agent upon demand (A) in the case of an amount
received in respect of a Bid Loan, its allocable share of any amount so
recovered from or repaid by Administrative Agent, and (B) in the case of any
other amount received under the Loan Documents, its Pro Rata Share of any amount
so recovered from or repaid by Administrative Agent; and (iii) each Designated
Bid Lender agrees to pay such Designated Bid Lender's allocable share of any
amount so recovered from or repaid by Administrative Agent in respect of any Bid
Loan made by such Designated Bid Lender; provided, however, that the foregoing
clause shall not prohibit any Designating Bank from agreeing with its Designated
Bid Lender that, as between such Designating Bank and Designated Bid Lender,
such Designating Bank shall pay to Administrative Agent any amount that would
otherwise be due to Administrative Agent under this Section 3.5(b), and such
Designated Bid Lender shall not be liable for any payment of any such amount to
the extent that its Designating Bank makes such payment.
(c) Administrative Agent shall have the exclusive right to collect on
the Loan from Borrower or any guarantors, third parties, or otherwise including
principal,
-38-
interest, fees or any prepayment premiums, whether such amounts are received
directly from Borrower, any guarantors, or other persons, or are collected by
offset by Administrative Agent against the money or other property of Borrower
or any guarantors deposited at or held by Administrative Agent, or other
enforcement of the Loan Documents. No Bank or Designated Bid Lender shall
independently initiate any judicial action or equivalent action or other
proceeding against Borrower with respect to the Loan.
(d) (i) Notwithstanding any other provision of any Loan Document or
the Co-Lender Agreement to the contrary, Administrative Agent, Banks and
Designated Bid Lenders agree with Borrower that any funds, claims, or
distributions actually received by Administrative Agent for the account of
any Bank or Designated Bid Lender as a result of the enforcement of, or
pursuant to, any Guaranty, net of Administrative Agent's and Banks'
expenses of collection thereof (such net amount, "Guaranty Proceeds"),
shall be made available for distribution equally and ratably (in proportion
to the aggregate amount of principal, interest and other amounts then owed
in respect of the Obligations or of an issuance of Public Debt (as defined
below), as the case may be) among the Administrative Agent, the Banks and
the Designated Bid Lenders and the trustee or trustees (or to the holders)
of (A) the Prudential Indebtedness, for so long as it remains Unsecured
Indebtedness, and (B) any other Unsecured Indebtedness, not subordinated to
the Obligations, issued by Borrower, before or after the Effective Date, in
offerings registered under the Securities Act of 1933, as amended, or in
transactions exempt from registration pursuant to Rule 144A thereof (the
Prudential Indebtedness, and any other such qualifying Unsecured
Indebtedness, "Public Debt"), and Administrative Agent is hereby
authorized, by Borrower, by each Bank (on its own behalf and on behalf of
its Designated Bid Lender, if any) and by each Guarantor (by its execution
and delivery of the Guaranty to which it is party) to make such Guaranty
Proceeds so available. No Bank or Designated Bid Lender shall have any
interest in any amount paid over by Administrative Agent to the trustee or
trustees in respect of any Public Debt (or to the holders thereof) pursuant
to the foregoing authorization. This Section 3.5(d) shall apply solely to
Guaranty Proceeds, and not to any payments, funds, claims or distributions
received by Administrative Agent, any Bank or any Designated Bid Lender
directly or indirectly from Borrower or any other Person other than from a
Guarantor pursuant to a Guaranty. Borrower is aware of the terms of the
Guarantees, and specifically understands and agrees with Administrative
Agent, the Banks and the Designated Bid Lenders that, to the extent
Guaranty Proceeds are distributed to holders of Public Debt or their
respective trustees, such Guarantor has agreed that the Obligations will
not be deemed reduced by any such distributions, and each Guarantor shall
continue to make payments pursuant to its Guaranty until such time as the
Obligations have been paid in full (and the Commitments have been
terminated and any Letter of Credit Exposure reduced to
-39-
zero), after taking into account any such distributions of Guaranty
Proceeds in respect of Indebtedness other than the Obligations.
(ii) Nothing contained herein shall be deemed (A) to limit,
modify, or alter the rights of Administrative Agent, the Banks and the
Designated Bid Lenders under any Guaranty, (B) to subordinate the
Obligations to any Public Debt, or (C) to give any holder of Public Debt
(or any trustee for such holder) any rights of subrogation.
(iii) This Agreement, and each Guaranty, are for the sole
benefit of Administrative Agent, the Banks and the Designated Bid Lenders
and their respective successors and assigns. Nothing contained herein or
in any Guaranty shall be deemed for the benefit of any holder of Public
Debt, or any trustee for such holder; nor shall anything contained herein
or therein be construed to impose on Administrative Agent, any Bank or any
Designated Bid Lender any fiduciary duties, obligations or responsibilities
to the holders of any Public Debt or their trustees (including, but not
limited to, any duty to pursue any Guarantor for payment under its
Guaranty).
4. CONDITIONS
4.1 Conditions Precedent to Initial Funding Date on or after the Effective
----------------------------------------------------------------------
Date.
-----
The obligation of each Bank and Designated Bid Lender under the Loan
Documents to make any Advances, and the obligation of Administrative Agent to
issue any Letter of Credit, on or after the Effective Date is subject to the
further conditions that Administrative Agent has received all of the following
in form and substance satisfactory to Administrative Agent:
(a) Loan Documents. Fully executed originals of this Agreement, the
--------------
Note, a Guaranty, executed on behalf of each Guarantor and the Co-Lender
Agreement and any other documents any Bank may reasonably require or request in
accordance with the Loan Documents.
(b) Authorizations. Evidence that the execution, delivery and
--------------
performance by Borrower and each Material Borrower Entity or other Guarantor (if
any) of each of the Loan Documents to which such Person is or is to become a
party have been duly authorized, including, without limitation, (i) Corporate
Resolution to borrow, certified by the Corporate Secretary of Borrower, together
with a Certificate of Incumbency for the authorized signing officers, containing
their specimen signatures and certified by the Corporate Secretary of Borrower,
and (ii) resolutions, or other required action, by each Material Borrower Entity
or other Guarantor with respect to the execution and delivery of its Guaranty,
together with a Certificate of Incumbency for the authorized signing
-40-
officers, containing their specimen signatures and certified by such Material
Borrower Entity's or other Guarantor's Secretary (or the equivalent).
(c) Governing Documents; Good Standing Certificates. For Borrower,
-----------------------------------------------
BRE Property Investors LLC, Cambridge Park LLC and each other Material Borrower
Entity or Guarantor or Other Unencumbered Property Owner (if any):
(i) a copy of such Person's articles of incorporation and
bylaws, articles of organization, Form LLC-1 and operating agreement, Form
LP-1 and agreement of limited partnership or other charter documents, as the
case may be, and
(ii) a certificate of good standing for such Person from the
state where formed and, at the Bank's request, from any other state in which
such Person is required to qualify to conduct its business.
(d) Reimbursement. Reimbursement of all costs and expenses incurred
-------------
by Administrative Agent in connection with this Agreement, including legal fees
and expenses of Administrative Agent's counsel, and the costs for services of
Administrative Agent's in-house staff, such as legal services.
(e) Payment of Fees. Payment of all accrued and unpaid fees and
---------------
expenses due Administrative Agent as provided for by the Loan Documents,
including those referred to in Section 2.1 that are required by this Agreement
or any letter understanding between Borrower and Administrative Agent to be paid
on or before the Effective Date and all other accrued and unpaid fees and
expenses provided for under the Existing Agreement (including, but not limited
to, the pro-rated facility fee accrued thereunder).
(f) Legal Opinion. An opinion of legal counsel for Borrower and each
-------------
Material Borrower Entity and other Guarantor addressing such matters as
Administrative Agent may reasonably request in the form of Exhibit J hereto.
(g) Amendment and Restatement of Existing Agreement. Evidence that
-----------------------------------------------
the full principal amount of and all accrued interest and fees under the
Existing Agreement have been paid or will be paid with the initial Advance under
this Agreement, and that the Existing Agreement has been amended and restated
and that all obligations of Borrower in respect thereof have been paid in full
or will be paid in full with the proceeds of the initial Advance.
(h) Other Items. Any other documents and other items Administrative
-----------
Agent may reasonably require as conditions precedent to the initial extensions
of credit under this Agreement.
-41-
4.2 Conditions to All Borrowings.
-----------------------------
The obligation of each Bank and Designated Bid Lender to make any
Advance (including its first disbursement on or after the Effective Date), and
of Administrative Agent to issue any Letter of Credit, under the Loan Documents
is subject to the satisfaction on the Funding Date of the relevant Borrowing of
the conditions set forth below, and, in the case of a Bid Loan, shall be subject
to the further condition that each of the statements made in the applicable
Competitive Bid Request shall be true and accurate in all material respects as
if made on and as of the date of such Bid Loan:
(a) Borrower shall have submitted a timely Borrowing Notice or
request for the issuance of a Letter of Credit (and, in the case of a Letter of
Credit, shall have delivered, or caused to be delivered, to Administrative
Agent, each of the Letter of Credit Documents relating thereto, in each case,
duly executed and delivered by each party thereto other than Administrative
Agent);
(b) No Event of Default or event that, with the giving of notice or
the passage of time, or both, would constitute an Event of Default shall have
occurred and be continuing at the time of such Advance or issuance, or would
exist as a result thereof; and
(c) Each of the representations and warranties of Borrower and each
Guarantor contained in this Agreement or the other Loan Documents shall be true
and correct in all material respects on the date of such Advance or issuance
(both before and after giving effect thereto), as if made thereon.
5. REPRESENTATIONS AND WARRANTIES
When Borrower signs this Agreement, and until the Commitments have
terminated, the Letters of Credit have been cancelled or have terminated and all
Obligations have been repaid in full, Borrower makes the following
representations and warranties. Each request for an extension of credit
constitutes a restatement of each such representation and warranty.
5.1 Organization of Borrower; Good Standing.
----------------------------------------
(a) Borrower, and each Guarantor, is duly formed and existing under
the laws of the state where organized. In each state in which Borrower or any
Guarantor does business, it is properly licensed, in good standing, and, where
required, in compliance with any fictitious name statute.
(b) Schedule 2 (if applicable, as updated pursuant to Section 6.18)
sets forth the members, general partners and limited partners, or other holders
of ownership interests in BRE Property Investors LLC and Cambridge Park LLC and
each other Material Borrower Entity or Guarantor, as well as of each Other
Unencumbered Property Owner, and their respective ownership percentages, and
there are no other membership,
-42-
partnership or other ownership interests outstanding. No membership, partnership
or other ownership interest (or any securities, instruments, warrants, option or
purchase rights, conversion or exchange rights, calls, commitments or claims of
any character convertible into or exercisable for such interests) in any
Material Borrower Entity, other Guarantor or Other Unencumbered Property Owner
is subject to issuance under any security, instrument, warrant, option or
purchase rights, conversion or exchange rights, call, commitment or claim of any
right, title or interest therein or thereto. All of the membership, partnership
or other ownership interests in Borrower and each Material Borrower Entity,
other Guarantor or Other Unencumbered Property Owner have been issued in
compliance with all applicable requirements of law.
5.2 Authorization; Enforceable Agreement.
-------------------------------------
This Agreement and the other Loan Documents are within the powers of
Borrower or the Material Borrower Entity or other Guarantor party thereto, have
been duly authorized and do not conflict with any of its organizational
documents. The Loan Documents do not conflict with any law, agreement or
obligation by which Borrower or any Material Borrower Entity or other Guarantor
is bound. This Agreement is a legal, valid and binding agreement of Borrower,
enforceable against Borrower in accordance with its terms, and any instrument or
document required hereunder, when executed and delivered by Borrower or any
Material Borrower Entity or other Guarantor, will be similarly a legal, valid,
binding and enforceable agreement of such Person.
5.3 Financial Information.
----------------------
(a) All financial statements and data submitted in writing by
Borrower to Administrative Agent or any Bank pursuant hereto are true and
correct, and all such financial statements present fairly the financial
condition of Borrower as at the date thereof and the results of the operations
of Borrower for the period(s) covered thereby, and have been prepared in
accordance with GAAP on a basis consistently applied. Borrower has no knowledge
of any liabilities, contingent or otherwise, not reflected in said financial
statements, and neither Borrower nor any Borrower Entity or Joint Venture Entity
has entered into any material commitments or material contracts which are not
reflected in said balance sheet which may have a Material Adverse Effect on
Borrower or any Material Borrower Entity. Since said date there have been no
changes in the assets or liabilities or financial condition of Borrower or any
Material Borrower Entity other than changes in the ordinary course of business,
and no such changes have been materially adverse changes.
(b) All financial and other information that has been or will be
supplied to Administrative Agent or any Bank, including the financial statements
of Borrower or any other Person:
-43-
(i) is sufficiently complete to give Administrative Agent and
the Banks accurate knowledge of the subject's financial condition;
(ii) is in form and content as required by Administrative Agent
and the Banks, previously communicated to Borrower;
(iii) is in compliance with any government regulations that
apply; and
(iv) does not fail to state any material facts necessary to make
the information contained therein not misleading.
All such information (other than Funds From Operations) was and will be prepared
in accordance with GAAP, unless otherwise noted.
5.4 Lawsuits.
---------
There is no lawsuit, arbitration, claim or other dispute pending or
threatened against Borrower or any Borrower Entity or Joint Venture Entity
which, if lost, could reasonably be expected to impair Borrower's or any
Material Borrower Entity's financial condition or ability to repay advances
made, and other amounts due, under the Loan Documents, except as has been
previously disclosed in writing to Administrative Agent and the Banks.
5.5 Title to Assets.
----------------
Borrower, and each Borrower Entity and Joint Venture Entity, has
good and clear title to its assets, and the same are not subject to any Liens
other than those disclosed to Administrative Agent and the Banks in writing.
5.6 Permits, Franchises.
--------------------
Borrower, and each Material Borrower Entity, possesses all permits,
franchises, contracts and licenses required and all trademark rights, trade name
rights, and fictitious name rights necessary to enable it to conduct the
business in which it is now engaged.
5.7 Income Tax Returns.
-------------------
Borrower, and each Borrower Entity and Joint Venture Entity, has
filed all tax returns and reports required to be filed and has paid all
applicable federal, state and local franchise, income and property taxes which
are due and payable. Borrower has no knowledge of any pending assessments or
adjustments of its income taxes or property taxes (or those of Borrower Entity
or Joint Venture Entity) for any year, except as have been disclosed in writing
to Administrative Agent and the Banks. Borrower is not a
-44-
"foreign person" within the meaning of Section 1445(f)(3) of the Internal
Revenue Code of 1986, as amended (the "Code").
5.8 ERISA Plans.
------------
(a) As used herein, (i) "ERISA" means the Employee Retirement Income
Act of 1974, as amended; (ii) "PBGC" means the Pension Benefit Guaranty
Corporation established pursuant to ERISA; and (iii) "Plan" means any employee
pension benefit plan maintained or contributed to by Borrower or any Borrower
Entity and insured by the PBGC.
(b) Borrower, and each Borrower Entity, has fulfilled its
obligations, if any, under the minimum funding standards of ERISA and the Code
with respect to each Plan and is in compliance in all material respects with the
presently applicable provisions of ERISA and the Code, and has not incurred any
liability with respect to any Plan under Title IV of ERISA.
(c) No reportable event has occurred under Section 4043(b) of ERISA
for which the PBGC requires 30 day notice. No action by Borrower or any Borrower
Entity to terminate or withdraw from any Plan has been taken and no notice of
intent to terminate a Plan has been filed under Section 4041 of ERISA. No
proceeding has been commenced with respect to a Plan under Section 4042 of
ERISA, and no event has occurred or condition exists which might constitute
grounds for the commencement of such a proceeding.
5.9 Other Obligations.
------------------
Neither Borrower nor any Material Borrower Entity or Joint Venture
Entity is in default on any Indebtedness or Contractual Obligation of Borrower,
such Material Borrower Entity or such Joint Venture Entity, as the case may be,
except as has been previously disclosed in writing to Administrative Agent and
the Banks.
5.10 Event of Default.
-----------------
There is no event which is, or with notice or lapse of time or both
would be, an Event of Default hereunder.
5.11 Status as a REIT.
-----------------
Borrower (i) is a real estate investment trust as defined in Section
856 of the Code (or any successor provision thereto), (ii) has not revoked its
election to be a real estate investment trust, (iii) has not engaged in any
"prohibited transactions" as defined in Section 856(b)(6)(iii) of the Code (or
any successor provision thereto), and (iv) for its current "tax year" (as
defined in the Code) is and for all prior tax years subsequent to its
-45-
election to be a real estate investment trust has been entitled to a dividends
paid deduction which meets the requirements of Section 857 of the Code.
6. COVENANTS
Borrower agrees, so long as credit is available under this Agreement or any
other Loan Document, until the Letters of Credit have been cancelled or have
terminated and all Obligations have been repaid in full:
6.1 Use of Proceeds.
----------------
Borrower shall use, and shall permit the proceeds of the advances
under the Loan Documents to be used, only for (a) the funding of costs directly
related to the acquisition of apartment projects, or (b) general working capital
and other corporate purposes of Borrower, including (but subject to Section
6.4(h)), development expenditures, or (c) refinancing existing and future
Indebtedness otherwise permitted by this Agreement. In complying with the
provisions of the foregoing clause (a), Borrower shall not be required to apply
advances under the Loan Documents in direct payment of acquisition costs, but
shall be permitted to request and obtain such advances by way of reimbursement
of acquisition costs previously incurred and funded out of Borrower's cash
reserves.
6.2 Financial Information.
----------------------
Borrower shall provide the following financial information and
statements and such additional information as requested by Administrative Agent
from time to time:
(a) As soon as available but not later than ninety (90) days after
Borrower's fiscal year end, a copy of Borrower's Form 10-K Annual Report and (to
the extent not included in such Form 10-K) a copy of Borrower's annual
consolidated financial statements for such fiscal year including balance sheet,
income statement, statement of cash flows and statement of shareholders' equity.
All such financial statements (whether or not included in Borrower's Form 10-K)
must be audited (with an unqualified opinion) by Borrower's CPA.
(b) As soon as available but not later than sixty (60) days after
each fiscal quarter end for the first three fiscal quarters of Borrower,
Borrower's Form 10-Q Quarterly Report and (to the extent not included in such
Form 10-Q) a copy of Borrower's consolidated financial statements for such
fiscal quarter, including balance sheet, income statement, statement of cash
flows and statement of shareholders' equity.
(c) As soon as available but not later than ninety (90) days after
Borrower's fiscal year end, Borrower's annual three-year consolidated financial
projection, including balance sheet and income statement, in a format and with
such detail as Administrative
-46-
Agent may require. These projections must be certified by Borrower's Chief
Financial Officer (or other officer acceptable to Administrative Agent).
(d) Copies of Borrower's Form 8-K Current Reports and all other
filings within fifteen (15) days after the date of filing with the Securities
and Exchange Commission, and copies of all press releases made by Borrower.
(e) As soon as available but not later than sixty (60) days after
the end of each of the first three fiscal quarters of Borrower's fiscal year,
and as soon as available but not later than ninety (90) days after the end of
each of Borrower's fiscal years, Borrower's quarterly internal management
reports (including (i) a schedule of all Fixed Charges for the prior quarter and
a schedule of Unsecured Interest Expense for the prior quarter, (ii) a schedule
of Net Operating Income for each Real Property and other real property asset for
the preceding four (4) fiscal quarters, (iii) a schedule listing all
Indebtedness secured by a Lien on any real property assets of Borrower or any
Borrower Entity or Joint Venture Entity, (iv) a statement of the number of
apartment units (by project and location) under development (as defined in
Section 6.4(h)) by Borrower or any Borrower Entity or Joint Venture Entity at
fiscal quarter-end, (v) a schedule identifying all real property leaseholds held
by Borrower or any Borrower Entity or Joint Venture Entity at fiscal quarter-
end, and (vi) a schedule showing the Borrower's share of each Borrower Entity
that is not a Guarantor and of each Joint Venture Entity at fiscal quarter-end).
These reports must be certified by Borrower's Chief Financial Officer (or other
officer acceptable to Administrative Agent).
(f) At the time of the delivery of the financial statements provided
for in Sections 6.2(a) and (b), a certificate executed by the Chief Financial
Officer of Borrower certifying compliance with all financial covenants herein,
including appropriate supporting schedules and calculations, and certifying that
to the best of the such officer's knowledge, no Event of Default has occurred
and is continuing or would result after notice or passage of time or both or, if
any Event of Default has occurred and is continuing or would result after notice
or passage of time or both, specifying the nature and extent thereof.
Notwithstanding anything to the contrary contained herein and without limiting
Administrative Agent's or the Banks' other rights and remedies, if any
certificate required under this Section 6.2 is not provided on or before the due
date therefor, Borrower shall be prohibited from any further borrowing or
issuances of Letters of Credit under the Loan Documents until such certificate
is provided.
6.3 Other Information.
------------------
Borrower shall provide Administrative Agent:
(a) Promptly upon, and in any event within forty-eight (48) hours
after Borrower first has actual knowledge of (i) its failing to continue to
qualify as a real estate investment trust as defined in Section 856 of the Code
(or any successor provision
-47-
thereof), (ii) any act by Borrower causing its election to be taxed as a real
estate investment trust to be terminated, (iii) any act causing Borrower to be
subject to the taxes imposed by Section 857(b)(6) of the Code (or any successor
provision thereto), or (iv) Borrower failing to be entitled to a dividends paid
deduction which meets the requirements of Section 857 of the Code, a notice of
any such occurrence or circumstance.
(b) Promptly upon receipt of all written claims, complaints, notices
or inquiries relating to compliance with Environmental Laws which are
individually or in the aggregate likely to have a Material Adverse Effect, a
notice of any such occurrence or circumstance, including Borrower's evaluation
of such claims, complaints, notices and inquiries and plan of resolution.
(c) Such additional financial and other information as
Administrative Agent may reasonably request from time to time.
6.4 Financial Covenants.
--------------------
(a) Minimum Net Worth. Borrower will maintain a Tangible Net Worth
-----------------
of not less than (i) $722,097,900, plus (ii) eighty-five percent (85%) of Net
Offering Proceeds received by Borrower after the date hereof.
(b) Total Liabilities to Total Asset Value. The ratio of Total
--------------------------------------
Liabilities to Total Asset Value shall not exceed 0.50:1.
(c) Secured Indebtedness to Total Asset Value. The ratio of Secured
-----------------------------------------
Indebtedness to Total Asset Value shall not exceed 0.30:1.
(d) Unencumbered Real Property to Unsecured Indebtedness. The ratio
----------------------------------------------------
of (A) Total Real Property Market Value of Unencumbered Real Property to (B)
total outstandings under Unsecured Indebtedness shall not be less than 1.75:1.
(e) Unencumbered Real Property NOI to Unsecured Interest Expense.The
------------------------------------------------------------
ratio of
(A) the sum of (1) the aggregate Net Operating Income of
all Unencumbered Real Properties owned directly by Borrower or any
Controlled Borrower Entity that is a Guarantor, plus (2) to the extent that
the aggregate contribution to the amount determined in accordance with this
clause (A) attributable to this subclause (2) is not in excess of 10% of
such total amount, for each (a) Controlled Borrower Entity that is not a
Guarantor or (b) Controlled Joint Venture Entity (whether or not it is a
Guarantor), Borrower's share of the Net Operating Incomes of all
Unencumbered Real Properties owned directly by such Person; to
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(B) Unsecured Interest Expense for any fiscal quarter,
shall not be less than 1.75:1.
(f) Adjusted EBITDA to Fixed Charges. The ratio of Adjusted EBITDA
--------------------------------
to Fixed Charges shall not be less than 1.75:1.
(g) Distributions.
--------------
(i) Subject to subparagraph (ii) below, aggregate
distributions by Borrower, determined on a consolidated basis, shall not
exceed the following, as reported in accordance with GAAP, for any period of
four (4) consecutive fiscal quarters of Borrower ended on December 31 of any
calendar year: the greater of (A) ninety-five percent (95%) of Funds From
Operations for such period, or (B) an amount, but not in excess of one
hundred percent (100%) of Funds From Operations for such period, as Borrower
may be required to distribute to its shareholders in order to maintain
compliance with Section 6.15. For purposes of this Section 6.4(g), the term
"distributions" shall mean and include (A) all dividends and other
distributions to, and the repurchase of shares or other equity interests
from, the holder of any equity interests in Borrower, BRE Property Investors
LLC or any other Consolidated Borrower Entity or Consolidated Joint Venture
Entity, other than (B) (1) redemptions of equity interests for common stock
of Borrower, and (2) to the extent not in excess of $5,000,000 in any one
fiscal year, redemptions of equity interests in BRE Property Investors LLC
or Cambridge Park LLC for cash or property other than common stock of
Borrower pursuant to the redemption provisions of its Charter Documents as
in effect on the date hereof.
(ii) No distributions (or redemptions in cash or property,
other than common stock of Borrower, of equity interests in BRE Property
Investors LLC not constituting distributions) shall be made during the
continuance of any Event of Default arising out of Borrower's failure to pay
any monetary obligation when due under any Loan Document (a "Monetary
Default"). Aggregate distributions or redemptions, in cash or property other
than common stock of Borrower, of equity interests in BRE Property Investors
LLC or Cambridge Park LLC during the continuance of any Event of Default
other than a Monetary Default (determined on a consolidated basis) shall not
exceed the lesser of (A) the aggregate amount of distributions permitted to
be made during the continuance thereof under subparagraph (i) above, or (B)
the minimum amount that Borrower must distribute to its shareholders in
order to maintain compliance with Section 6.15.
(h) Development. At no time shall the total number of apartment
-----------
units under development by Borrower or any Borrower Entity or Joint Venture
Entity exceed the lesser of (i) twenty percent (20%) of the total number of
apartment units (excluding such units under development) then owned by Borrower
or any Borrower Entity or Joint
-49-
Venture Entity, and (ii) 6,000 apartment units. For purposes of the foregoing
covenant, "development" shall mean all units under construction, at or beyond
the foundation stage, within a particular apartment project, until the
construction of all units (or discreet phase(s) thereof, if applicable) shall
have been completed, certificates of occupancy shall have been issued with
respect to such units, and such units shall be available for immediate lease and
occupancy in the normal course of business.
(i) Maximum Unsecured Lines of Credit. Borrower shall not permit
---------------------------------
total commitments (disbursed and undisbursed) with respect to Unsecured
Indebtedness of Borrower, any Borrower Entity or any Joint Venture Entity under
lines of credit to exceed the sum of (i) the Maximum Loan Amount, plus (ii) the
total commitments (disbursed and undisbursed) made available to Borrower under
any and all other lines of credit from time to time provided to Borrower, any
Borrower Entity or any Joint Venture Entity by (A) Administrative Agent and the
Banks, or (B) a group of lenders, consisting of BofA and one or more other
lenders, for whom BofA serves as agent at the time such line of credit is first
made available. Further, neither Borrower nor any Borrower Entity or Joint
Venture Entity shall enter into any commitment for Unsecured Indebtedness under
lines of credit other than under (x) this Agreement, and (y) any other lines of
credit from time to time provided to Borrower, any Borrower Entity or any Joint
Venture Entity by Administrative Agent and the Banks or by a group of lenders,
consisting of BofA and one or more other lenders, for whom BofA serves as agent
at the time such line of credit is first made available.
(j) Unsecured Indebtedness. Neither Borrower nor any Borrower
----------------------
Entity or Joint Venture Entity shall incur, or permit to exist, any Unsecured
Indebtedness other than (i) Indebtedness under revolving lines of credit to the
extent permitted under Section 6.4(i), and (ii) non-revolving, non-amortizing
Indebtedness with a maturity or call date not earlier than one (1) year after
the Maturity Date under the Note; provided, however, that the foregoing
amortization restriction shall not apply to amortization required, as of the
date of this Agreement, under the Prudential Indebtedness, and provided further
that no Guarantor or Other Unencumbered Property Owner shall incur, or permit to
exist, any Indebtedness other than Non-Recourse Indebtedness.
(k) Calculation. Each of the foregoing ratios and financial
-----------
requirements shall be calculated as of the last day of each fiscal quarter, but
shall be satisfied at all times.
6.5 Taxes and Other Liabilities.
----------------------------
Borrower shall pay and discharge, and shall cause each Controlled
Borrower Entity and Controlled Joint Venture Entity to pay and discharge, before
the same become delinquent and before penalties accrue thereon, all taxes,
assessments and governmental charges upon or against it or any of its
properties, and all its other liabilities at any time existing, except to the
extent and so long as:
-50-
(a) The same are being contested in good faith and by appropriate
proceedings in such manner as not to cause any Material Adverse Effect on
Borrower or any Material Borrower Entity or the loss of any right of redemption
from any sale thereunder; and
(b) Borrower shall have set aside on its books reserves (segregated
to the extent required by GAAP) adequate with respect thereto.
6.6 Notices to Administrative Agent.
--------------------------------
Borrower shall promptly notify Administrative Agent in writing of:
(a) any Event of Default hereunder or any event which would become an
Event of Default hereunder upon the giving of notice, the lapse of time, or
both;
(b) any single lawsuit or arbitration claiming over Two Hundred Fifty
Thousand Dollars ($250,000), and lawsuits or arbitrations collectively claiming
over One Million Dollars ($1,000,000), against Borrower or any Guarantor;
(c) any significant dispute between Borrower or any Guarantor and any
government authority;
(d) Borrower's receipt of any notice relating to (i) any change in or
reaffirmation of, or proposed change in or reaffirmation of, the rating of
Borrower's senior long-term unsecured debt obligations by any Rating Agency, or
(ii) the issuance of any Rating by a Rating Agency as to which no Rating is then
in effect; and
(e) any event, circumstance or condition which may have a Material
Adverse Effect on Borrower or any Guarantor.
6.7 Audits; Books and Records.
--------------------------
Borrower shall (i) maintain (and shall cause each Controlled Borrower
Entity and Controlled Joint Venture Entity to maintain) adequate books and
records, and (ii) allow Administrative Agent and its agents (and cause
Controlled Borrower Entities and Controlled Joint Venture Entities to allow
Administrative Agent and its agents) to inspect Borrower's and such Controlled
Borrower Entities' and Controlled Joint Venture Entities' properties and
examine, audit and make copies of books and records at any reasonable time. If
any of Borrower's properties, books or records are in the possession of a third
party, Borrower hereby authorizes that third party to permit Administrative
Agent or its agents to have access to perform inspections or audits and to
respond to Administrative Agent's requests for information concerning such
properties, books and records.
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6.8 Compliance with Laws.
---------------------
Borrower shall comply, and shall cause each Controlled Borrower
Entity and Controlled Joint Venture Entity to comply, with the laws (including
any fictitious name statute), regulations, and orders of any government body
with authority over such Person's business.
6.9 Preservation of Rights.
-----------------------
Borrower shall maintain and preserve, and shall cause each Material
Borrower Entity to maintain and preserve, all rights, privileges, and franchises
Borrower or such Material Borrower Entity now has (or, if later, as of the date
such Person becomes a Material Borrower Entity).
6.10 Maintenance of Properties.
--------------------------
Borrower shall make, and shall cause each Controlled Borrower Entity
and Controlled Joint Venture Entity to make, repairs, renewals, or replacements
to keep such Person's properties in good working condition.
6.11 Insurance.
----------
Borrower shall maintain, or cause to be maintained, insurance in such
amounts and covering such risks as is usually carried by companies engaged in
similar businesses and owning similar properties in the same general areas in
which Borrower and the Controlled Borrower Entities and Controlled Joint Venture
Entities operate and maintain such other insurance and coverages as may be
reasonably required by Administrative Agent. All such insurance shall be in
form and amount and with companies satisfactory to Administrative Agent. Upon
Administrative Agent's request, Borrower shall furnish Administrative Agent with
a copy of the policy or binder of all such insurance and continuing evidence
that such insurance remains in force at applicable renewal dates.
6.12 ERISA Plans.
------------
Borrower shall give prompt written notice to Administrative Agent of
the occurrence of any reportable event under Section 4043(b) of ERISA for which
the PBGC requires 30 day notice; any action by Borrower or any Borrower Entity
to terminate or withdraw from a Plan or the filing of any notice of intent to
terminate under Section 4041 of ERISA; any notice of noncompliance made with
respect to a Plan under Section 4041(b) of ERISA; or the commencement of any
proceeding with respect to a Plan under Section 4042 of ERISA.
-52-
6.13 Indemnity of Guarantors.
------------------------
Borrower shall indemnify and hold harmless each Guarantor from and
against any liability (in the form of indebtedness repaid to Administrative
Agent, any Bank or any Designated Bid Lender) in respect of Borrower's
obligations under the Loan Documents, including (if applicable) by way of
foreclosure on any collateral in which such Guarantor may at any time hereafter
grant to Administrative Agent a security interest) in excess of the benefit
realized by such Guarantor from the proceeds of the Loan. As between Borrower
and each Guarantor, Borrower shall be responsible to reimburse each Guarantor in
respect of amounts paid by such Guarantor pursuant to its Guaranty of Borrower's
obligations under the Loan Documents to the end that Borrower, and each
Guarantor, ultimately bear the burden of their respective shares of such
obligations. Borrower's obligations to the Guarantors under this Section 6.13
shall be subordinated to its obligations to Administrative Agent, the Banks and
the Designated Bid Lenders as provided in the Guaranties.
6.14 Additional Negative Covenants.
------------------------------
Borrower shall not, without Administrative Agent's written consent
(delivered upon such consent of any or all of the Banks as may be required under
the Co-Lender Agreement):
(a) Merge or dissolve into, or consolidate with, any Person, or
permit any Material Borrower Entity to do so, except in each case for mergers
and consolidations (i) which result in Borrower or such Material Borrower
Entity, as the case may be, being the surviving entity (provided that Borrower
shall be the surviving entity in any merger or consolidation with a Material
Borrower Entity), (ii) which do not have a Material Adverse Effect on Borrower
or the affected Material Borrower Entity, and (iii) which do not result in
Borrower, following the consummation of such merger or consolidation, being in
default under any term or condition of this Agreement. Neither Borrower nor any
Material Borrower Entity shall sell, lease, transfer, encumber or otherwise
dispose of all or any substantial part of its properties or assets, whether in a
single transaction or series of transactions, if such sale, lease, transfer,
encumbrance or other disposition would cause a Material Adverse Effect on
Borrower or such Material Borrower Entity; nor shall Borrower transfer to any
Borrower Entity or Joint Venture Entity any Real Property or other material
asset owned as of the date hereof or that constitutes proceeds (or proceeds of
proceeds) of any Real Property or other material asset owned by Borrower as of
the date hereof;
(b) Except for any such amendment that is required under any
requirement of law imposed by any governmental authority or in order to maintain
compliance with Section 6.15, amend its articles of incorporation or by-laws, or
permit any Material Borrower Entity to amend any of its charter documents,
except in each case (i) upon at least ten (10) Banking Days' prior written
notice to Administrative Agent, and (ii) if
-53-
Administrative Agent notifies Borrower within such 10-day period that such
amendment is, in Administrative Agent's reasonable judgment, a material
amendment, with the prior written consent of Administrative Agent;
(c) Suspend its business activity, or permit any Material Borrower
Entity to suspend its business activity, in either case for more than two days;
(d) Voluntarily commence any case under the United States Bankruptcy
Code (or any successor statute) with respect to itself unless Borrower
concurrently causes each Guarantor to commence a voluntary case under the United
States Bankruptcy Code (or such successor statute) with respect to itself, and
requests that all such cases be consolidated with its own;
(e) Use any proceeds of any advance under the Loan Documents (or
permit such proceeds to be used), directly or indirectly, to purchase or carry,
or 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 Margin Stock;
(f) Permit Borrower's aggregate Investments in Borrower Entities or
Joint Venture Entities that have not executed and delivered a Guaranty that
remains in full force and effect to exceed at any time ten percent (10%) of
Borrower's consolidated total asset value, determined in accordance with GAAP;
(g) Cease to Control any Material Borrower Entity, other Guarantor or
Other Unencumbered Property Owner; or
(h) Create, suffer or permit to exist any Lien on its interest in any
Guarantor or Other Unencumbered Property Owner.
6.15 Continued Status as a REIT; Prohibited Transactions.
-----------------------------------------------------
Borrower (i) will continue to be a real estate investment trust as
defined in Section 856 of the Code (or any successor provision thereto), (ii)
will not revoke its election to be a real estate investment trust, (iii) will
not engage in any "prohibited transactions" as defined in Section 856(b)(6)(iii)
of the Code (or any successor provision thereto), and (iv) will continue to be
entitled to a dividend paid deduction meeting the requirements of Section 857 of
the Code.
6.16 NYSE Listed Company.
--------------------
The common stock of Borrower shall at all times be listed for trading
and be traded on the New York Stock Exchange.
-54-
6.17 Conduct of Business.
--------------------
Borrower shall engage primarily in the business of direct ownership,
operation and acquisition or development for its own account of apartment
projects located in the Western United States (which shall be understood to mean
Colorado and States westward); provided, however, that the foregoing shall not
restrict either Borrower's continued ownership and operation of assets owned as
of the Effective Date or other business activities of Borrower or any Borrower
Entity reasonably incidental to business activities otherwise permitted under
this Section 6.17.
6.18 Delivery of Guaranties and Other Documents.
-------------------------------------------
Within fifteen (15) days after (a) any Borrower Entity becomes a
Material Borrower Entity, or (b) Borrower forms or acquires, by merger or
otherwise, a Material Borrower Entity: Borrower shall (x) give Administrative
Agent written notice thereof, (y) cause such Material Borrower Entity to execute
and deliver to Administrative Agent a Guaranty, and (z) deliver to
Administrative Agent (i) with respect to such Material Borrower Entity, the
documents described in Sections 4.1(b) and 4.1(c), (ii) an updated Schedule 2,
reflecting such information with respect to such Material Borrower Entity as is
required to be reflected on Schedule 2 pursuant to Section 5.1(b), and (iii) an
opinion of counsel addressing the due formation, existence and good standing of
such Person, the due authorization, execution and delivery by such Person of
such Guaranty, the enforceability thereof, and such other matters, if any, as
Administrative Agent may reasonably request. Upon the inclusion of any real
property asset owned by a Borrower Entity or Joint Venture Entity other than a
Material Borrower Entity as Unencumbered Real Property by virtue of the
execution and delivery by such Borrower Entity or Joint Venture Entity of a
Guaranty, or by a Person that would, as a result of such inclusion, become an
Other Unencumbered Property Owner (but, in either case, without limiting the
requirement that such real property asset qualify in all respects as
"Unencumbered Real Property" in order to be included as such), Borrower shall
deliver to Administrative Agent (1) with respect to such Guarantor or Other
Unencumbered Property Owner, the documents described in Sections 4.1(b) and
4.1(c), as applicable, (2) an updated Schedule 2, reflecting such information
with respect to such Guarantor or Other Unencumbered Property Owner as is
required to be reflected on Schedule 2 pursuant to Section 5.1(b), and (3) if
such Person is becoming a Guarantor, an opinion of counsel addressing the due
formation, existence and good standing of such Person, the due authorization,
execution and delivery by such Person of such Guaranty, the enforceability
thereof, and such other matters, if any, as Administrative Agent may reasonably
request.
6.19 Cooperation.
------------
Borrower shall take any action reasonably requested by Administrative
Agent to carry out the intent of the Loan Documents.
-55-
7. COLLATERAL
This Line of Credit is unsecured.
8. DEFAULT
If any of the following events occurs (an "Event of Default"),
Administrative Agent may (and shall, upon the instructions of Majority Banks)
declare Borrower in default, stop making any additional credit available to
Borrower, and require Borrower to repay its entire debt immediately and without
prior notice. However, if a bankruptcy petition is filed with respect to
Borrower, the entire debt outstanding under the Loan Documents shall
automatically be due immediately.
8.1 Failure to Pay.
---------------
Borrower, or any Guarantor, fails to make any payment due under the
Loan Documents (i) within fifteen (15) days after the date when due, or (ii)
within such other period, or no period, as may expressly be provided in any
other Loan Document to constitute an Event of Default.
8.2 False Information.
------------------
Borrower, or any Guarantor, has given Administrative Agent, or any
Bank, false or misleading information or representations.
8.3 Bankruptcy.
-----------
Borrower, or any Borrower Entity or Joint Venture Entity, files a
bankruptcy petition or makes a general assignment for the benefit of creditors,
or a bankruptcy petition is filed against any such Person and is not dismissed
within a period of forty-five (45) days after the filing; provided, however,
that neither Administrative Agent, any Bank nor any Designated Bid Lender will
be obligated to extend any additional credit to Borrower during that period.
8.4 Receivers; Dissolution.
-----------------------
A receiver or similar official is appointed for Borrower's, or any
Borrower Entity's or Joint Venture Entity's, business, or the business is
terminated; or any order, judgment or decree is entered against Borrower or any
Borrower Entity or Joint Venture Entity decreeing its involuntary dissolution or
split up and remains undischarged and unstayed for a period in excess of thirty
(30) days; the directors or other managing body of, or the members, shareholders
or other holders of the equity interests in, Borrower or any Material Borrower
Entity shall take any action authorizing the dissolution of Borrower or any
Material Borrower Entity; or Borrower or any Material Borrower Entity shall
otherwise dissolve or (except as the result of the merger of a Material Borrower
-56-
Entity into Borrower) cease to exist; or Borrower or any Borrower Entity or
Joint Venture Entity becomes unable or admits in writing its inability or fails
generally to pay its debts as they become due; or any writ or warrant of
attachment or execution or similar process is issued or levied against all or
any material part of the property of Borrower or any Borrower Entity or Joint
Venture Entity and is not released, vacated or fully bonded within thirty (30)
days of its issue or levy.
8.5 Lawsuits.
---------
Any lawsuit(s) or arbitration(s) are initiated against Borrower or
any Material Borrower Entity involving claims exceeding in the aggregate Fifty
Million Dollars ($50,000,000) or more at any one time in excess of any insurance
coverage.
8.6 Judgments.
----------
Any judgment or arbitration award is entered against Borrower or any
Material Borrower Entity, or Borrower, or any Material Borrower Entity, enters
into any settlement agreement with respect to any litigation, claim or
arbitration, in an aggregate amount of Ten Million Dollars ($10,000,000) or more
in excess of any insurance coverage.
8.7 ERISA Plans.
------------
The occurrence of any of the following event(s) with respect to
Borrower or any Material Borrower Entity, provided such event(s) could
reasonably be expected, in the judgment of Administrative Agent, to subject
Borrower or such Material Borrower Entity to any tax, penalty or liability (or
any combination of the foregoing) which in the aggregate could have a Material
Adverse Effect on Borrower or such Material Borrower Entity with respect to a
Plan:
(a) A reportable event occurs with respect to a Plan which in the
reasonable judgment of Administrative Agent may result in the termination of
such Plan for purposes of ERISA.
(b) Any Plan termination (or commencement of proceedings to terminate
a Plan) or Borrower's, or any Material Borrower Entity's, full or partial
withdrawal from a Plan.
8.8 Government Action.
------------------
Any government authority takes action that the Majority Banks believe
could have a Material Adverse Effect on Borrower or any Material Borrower
Entity.
-57-
8.9 Material Adverse Change.
------------------------
Any event, circumstance or condition shall occur, or is reasonably
likely to occur, which the Majority Banks believe could have a Material Adverse
Effect on Borrower or any Material Borrower Entity.
8.10 Other Breach Under This Agreement or Other Loan Documents.
----------------------------------------------------------
(a) Borrower fails to meet the conditions of or fails to perform any
obligation under any of Sections 6.2, 6.5, 6.11 and 6.18, and such failure
continues uncured for a period of fifteen (15) days.
(b) Borrower, or any Guarantor, fails to meet the conditions of or
fails to perform any obligation under any term of this Agreement or any other
Loan Document not specifically referred to in this Article 8. If, in
Administrative Agent's opinion, the breach is capable of being remedied, the
breach will not be considered an Event of Default under this Agreement for a
period of thirty (30) days after the date on which Administrative Agent gives
written notice of the breach to Borrower; provided, however, that neither
Administrative Agent, the Banks nor the Designated Bid Lenders will be obligated
to extend any additional credit to Borrower during that period.
8.11 Cross-Default.
--------------
Any default occurs under any agreement in connection with any credit
Borrower or any Controlled Borrower Entity, Consolidated Borrower Entity,
Controlled Joint Venture Entity or Consolidated Joint Venture Entity, or any of
Borrower's other Affiliates (other than VelocityHSI, a Delaware corporation),
has obtained from any creditor, or which constitutes an Accommodation Obligation
of Borrower or any such other Person, if the default consists of a failure to
make a payment when due or gives the creditor the right to accelerate (or causes
the acceleration of) the obligation.
8.12 Change in Control.
-----------------
The acquisition by any Person or group (within the meaning of Rule
13d-5 of the Securities and Exchange Commission under the Securities Exchange
Act of 1934), or two or more Persons acting in concert, of beneficial ownership
(within the meaning of Rule 13d-3 of the Securities and Exchange Commission
under the Securities Exchange Act of 1934) of either (i) 33-1/3% or more of the
outstanding shares of voting stock of Borrower or (ii) the power to direct or
cause the direction of the management and policies of Borrower, whether through
the ownership of voting securities, by contract or otherwise
8.13 Impairment of Certain Documents.
--------------------------------
Except as otherwise expressly permitted in any Loan Document, any of
the Loan Documents shall terminate or cease in whole or in part to be the
legally valid,
-58-
binding, and enforceable obligation of Borrower or any Guarantor as applicable,
or such Person contests such validity, binding effect or enforceability, or
purports to revoke any Loan Document.
9. ENFORCING THIS AGREEMENT
9.1 Remedies.
---------
If an Event of Default occurs under the Loan Documents,
Administrative Agent, the Banks and the Designated Bid Lenders may exercise any
right or remedy they have under any of the Loan Documents or which is otherwise
available at law or in equity. All of such rights and remedies shall be
cumulative. At the Majority Banks' option, exercisable in their sole discretion,
all of Borrower's obligations under the Loan Documents will become immediately
due and payable without notice of default, presentment or demand for payment,
protest or notice of nonpayment or dishonor, or other notices or demands of any
kind.
10. APPOINTMENT AND AUTHORIZATION OF AGENT
10.1 Appointment.
------------
Each Bank hereby irrevocably appoints, designates and authorizes
Administrative Agent to take such action on its behalf under the provisions of
this Agreement and each other Loan Document and to exercise such powers and
perform such duties as are expressly delegated to it by the terms of this
Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto and as further provided in the Co-Lender Agreement
described below.
10.2 Powers.
-------
Subject to the limitations set forth in the Loan Documents and Co-
Lender Agreement, Administrative Agent's powers include but are not limited to
the power: (i) to administer, manage and service the Line of Credit and the Bid
Loan Facility; (ii) to enforce the Loan Documents; (iii) to make all decisions
under the Loan Documents in connection with the day-to-day administration of the
Line of Credit and Bid Loan Facility, any inspections authorized by the Loan
Documents, and other routine administration and servicing matters; (iv) to
collect and receive from Borrower or any third persons all payments of amounts
due under the terms of the Loan Documents and to distribute the amounts thereof
to the Banks, for their own account and for the respective accounts of their
Designated Bid Lenders; (v) to collect and distribute or disburse all other
amounts due under the Loan Documents; (vi) to grant or withhold consents,
approvals or waivers, and make any other determinations in connection with the
Loan Documents; and (vii) to exercise all such powers as are incidental to any
of the foregoing matters. Administrative Agent shall furnish to Banks, for their
own use and for
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transmittal to their Designated Bid Lenders, copies of material documents,
including confidential ones, received from Borrower regarding the Line of Credit
or the Bid Loan Facility, the Loan Documents and the transactions contemplated
thereby. Administrative Agent shall have no responsibility with respect to the
authenticity, validity, accuracy or completeness of the information provided.
10.3 Limitation on Duties.
---------------------
Notwithstanding any provision to the contrary contained in any Loan
Document, Administrative Agent shall not have any duties or responsibilities,
except those expressly set forth in the Loan Documents or the Co-Lender
Agreement, nor shall Administrative Agent have any fiduciary relationship with
any Bank or Designated Bid Lender, and no implied covenants, responsibilities,
duties, obligations or liabilities shall be read into this Agreement or any
other Loan Document against Administrative Agent.
10.4 Co-Lender Agreement.
--------------------
Borrower acknowledges that the Banks (and each Designated Bid Lender
at any time party to a Designation Agreement) have executed a Co-Lender
Agreement (as amended from time to time, the "Co-Lender Agreement") to
supplement the Loan Documents with respect to the relationship of the Banks, the
Designated Bid Lenders and Administrative Agent among themselves in connection
with the credit facilities provided under the Loan Documents. The Co-Lender
Agreement is not a Loan Document.
10.5 Resignation; Replacement.
-------------------------
(a) Administrative Agent may, and at the request of the Majority
Banks shall, resign as Administrative Agent upon 30 days' notice to the Banks.
If Administrative Agent resigns under this Agreement, the Majority Banks (other
than Administrative Agent) subject to Section 10.5(b)) shall appoint from among
the Banks a successor agent. If no successor agent is appointed prior to the
effective date of the resignation of Administrative Agent, Administrative Agent
may appoint, after consulting with the Banks, a successor agent from among the
Banks. Upon the acceptance of appointment as successor agent hereunder, such
successor agent shall succeed to all the rights, powers and duties of the
retiring Administrative Agent and the term "Administrative Agent" shall mean
such successor agent, and the retiring Administrative Agent's appointment,
powers and duties as Administrative Agent shall terminate. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions regarding payment of costs and expenses and indemnification of
Administrative Agent shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this
Agreement. If no successor agent has accepted appointment as Administrative
Agent by the date which is 30 days following a retiring Administrative Agent's
notice of resignation, the retiring Administrative Agent's resignation shall
nevertheless thereupon become effective, and
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the Banks shall perform all of the duties of Administrative Agent hereunder
until such time, if any, as the Majority Banks appoint a successor agent.
(b) Each successor Administrative Agent appointed by the Banks shall
concurrently assume the rights and obligations of (i) the Swing Line Lender
(including the Swing Line Lender's commitment to fund Swing Line Borrowings and
its interest in outstanding Advances under the Swing Line) and (ii)
Administrative Agent in its capacity as issuer of all outstanding Letters of
Credit (and who, concurrently with its appointment as Administrative Agent,
issues replacement Letters of Credit for such outstanding Letters of Credit,
which shall be cancelled and returned to the outgoing Administrative Agent).
Neither the commitment of the Swing Line Lender to fund Swing Line Borrowings,
nor the Swing Line Lender's interest in outstanding Swing Line Borrowings, may
be assigned to any Person other than a Person who concurrently becomes both a
successor Administrative Agent and the Swing Line Lender.
11. ASSIGNMENTS, PARTICIPATIONS, ETC.
11.1 Assignments.
------------
A Bank may at any time assign to one or more Eligible Assignees (each
an "Assignee") with the written consent of Borrower (other than during the
existence of an Event of Default) and of Administrative Agent (at all times),
which consent shall not be unreasonably withheld (provided that no written
consent shall be required for an Eligible Assignee that is an Affiliate of such
assignor Bank) all or part of its Pro Rata Share of the Line of Credit and the
other rights and obligations of such assignor Bank hereunder with respect to the
Committed Loans and the Line of Credit (excluding, however, its interest in any
outstanding Bid Loans), in a minimum amount (with respect to such Bank's
Commitment) of $5,000,000; provided, however, that no such assignment (other
than an assignment of the assignor Bank's entire remaining Commitment) shall be
permitted if the effect thereof is to cause the remaining Commitment of the
assignor Bank to be less than $15,000,000, and no assignment may be made of any
outstanding Committed Loan except in connection with an assignment of a
corresponding proportional share of the assignor Bank's Commitment, and provided
further that so long as no Event of Default has occurred and is continuing, no
such assignment shall be permitted for BofA so long as BofA remains the
Administrative Agent if the effect of such assignment is to cause the remaining
Commitment of BofA to be less than $20,000,000. However, such assignment shall
be conditioned on, and Borrower and Administrative Agent may continue to deal
solely and directly with such assignor Bank until, (i) written notice of such
assignment, substantially in the form of the attached Exhibit F shall have been
given to Borrower and Administrative Agent by such Bank and the Assignee; (ii)
such Bank and its Assignee shall have delivered to Administrative Agent and
Borrower an Assignment and Assumption Agreement substantially in the form of the
attached Exhibit G ("Assignment and Assumption Agreement") (together with any
Note(s) subject to such assignment);
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and (iii) the Assignor has paid (or caused to be paid) to Administrative Agent a
processing fee in the amount of $5,000.
11.2 Effects of Assignment.
----------------------
From the date that Administrative Agent notifies the assignor Bank
that all conditions and requirements of the assignment have been met, then to
the extent that rights and obligations hereunder have been assigned (i) the
Assignee thereunder shall be a party hereto and shall have the rights and
obligations of a Bank under the Loan Documents and the Co-Lender Agreement, (ii)
the assignor Bank shall relinquish such assigned rights and be released from
such assigned obligations under the Loan Documents, (iii) this Agreement shall
be deemed to be amended to the extent necessary to reflect the addition of the
Assignee and the resulting adjustment of the Pro Rata Shares of the Loan arising
therefrom, and (iv) the Pro Rata Share allocated to an Assignee shall reduce the
Pro Rata Share of the assigning Bank.
11.3 Participations.
---------------
A Bank or Designated Bid Lender (the "originating Lender") may sell
to one or more Persons not Affiliates of Borrower (a "Participant")
participating interests in the Line of Credit or in any Bid Loans made by the
originating Lender; provided that (i) the originating Lender's obligations under
the Loan Documents and the Co-Lender Agreement shall remain unchanged, (ii) the
originating Lender shall remain solely responsible for the performance of such
obligations, (iii) Borrower and Administrative Agent shall continue to deal
solely and directly with the originating Lender (or, in the case of a Designated
Bid Lender, its Designating Bank) in connection with the Advances and Loan
Documents, (iv) (A) no Bank shall transfer or grant any participating interest
under which the Participant has rights to approve any amendment, consent or
waiver with respect to any Loan Document, except (1) in the case of a
participation that includes an interest in the originating Lender's Commitment,
to the extent such amendment, consent or waiver would require unanimous consent
of the Banks under Section 7(a) of the Co-Lender Agreement, or (2) in the case
of a participation that is limited to an interest in one or more Bid Loans, to
the extent such amendment, consent or waiver would take effect while such Bid
Loan(s) remained outstanding and would require the unanimous consent of the
Banks under any of the following clauses of Section 7(a) of the Co-Lender
Agreement: clause (ii), to the extent that the proposed action would affect Bid
Loans or any amount payable with respect to Bid Loans; clause (iii), to the
extent that the proposed action would affect any amount payable in connection
with Bid Loans; clause (iv); clause (v); and clause (vi); and (B) no Designated
Bid Lender shall transfer or grant any participating interest under which the
Participant has rights to approve any amendment, consent or waiver with respect
to any Loan Document greater that the lesser of (1) such rights of approval as
may have been granted to such Designated Bid Lender in connection with its entry
into the relevant Designation Agreement, or (2) as described in Section 11.5(a)
as being permitted to Designated Bid Lenders, (v) with respect to the sale of
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participating interests in the Line of Credit (it being understood that the
limitations of this clause (v) shall not apply with respect to the sale of a
participating interest in all or any portion of a Bid Loan), each participating
interest in a Bank's Commitment shall be in a minimum amount of $5,000,000, and
no such participation shall be permitted if the non-participated interest of the
originating Lender in its Commitment would thereafter be less than $15,000,000.
A Participant shall not have any rights under the Loan Documents or the Co-
Lender Agreement, and all amounts payable by Borrower hereunder shall be
determined as if the originating Lender had not sold such participation.
11.4 Pledges.
--------
Notwithstanding any other provision of this Agreement, any other Loan
Document or the Co-Lender Agreement: (i) a Bank or Designated Bid Lender may
pledge its interest in Borrower's obligations under the Loan Documents in favor
of any Federal Reserve Bank in accordance with Federal law; and (ii) a
Designated Bid Lender may pledge its interest in Borrower's obligations under
the Loan Documents in respect of any Bid Loan in favor of any Liquidity Provider
qualifying as such with respect to the Bid Loan so pledged.
11.5 Designated Bid Lenders.
-----------------------
(a) Any Bank may at any time, with the prior written consent of
Borrower and Administrative Agent, which consent shall not be unreasonably
withheld, designate one Designated Bid Lender to fund Bid Loans on behalf of
such Designating Bank subject to the terms of this Section 11.5, and the
provisions of Sections 11.1, 11.2 and 11.3 shall not apply to such designation,
except that no Designating Bank shall enter into any agreement under which its
Designated Bid Lender has rights to approve any amendment, consent or waiver
with respect to any Loan Document, except to the extent such amendment, consent
or waiver would amend any right of Designated Bid Lenders or would require the
unanimous consent of the Banks under any of the following clauses of Section
7(a) of the Co-Lender Agreement: clause (ii), to the extent that the proposed
action would affect Bid Loans or any amount payable with respect to Bid Loans;
clause (iii), to the extent that the proposed action would affect any amount
payable in connection with Bid Loans; clause (iv); clause (v), if the proposed
action would take effect while any Bid Loans made by such Designated Bid Lender
were outstanding; and clause (vi). No Bank may designate more than one
Designated Bid Lender at any one time, and, following the termination of a
designation with respect to one Designated Bid Lender, no new Designated Bid
Lender may be designated until all outstanding Bid Loans made by the prior
Designated Bid Lender have been paid in full. The parties to each such
designation shall execute and deliver to Borrower and Administrative Agent for
their acceptance a Designation Agreement, and, upon Administrative Agent's
receipt of (i) an appropriately completed Designation Agreement (A) executed by
a Designating Bank and a designee representing that it is a Designated Bid
Lender and (B) accepted by Borrower, and (ii) a processing fee in the amount of
$2,500, Administrative Agent shall
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accept such Designation Agreement and register such Designated Bid Lender as a
Designated Bid Lender, and give prompt notice thereof to Borrower, whereupon:
from and after the effective date specified in the Designation Agreement, the
Designated Bid Lender shall become a party to this Agreement and to the Co-
Lender Agreement, as a Designated Bid Lender, with (X) a right to make Bid Loans
on behalf of its Designating Bank pursuant to Section 1.3(b)(ix) with respect to
any Competitive Bid of such Designating Bank that is accepted in whole or in
part by Borrower, and (Y) the other rights, and the obligations, provided herein
and therein, subject to the limitation, however, that, notwithstanding the
assumption by a Designated Bid Lender of certain of the obligations of its
Designating Bank (but without limiting the Designating Bank's obligations under
the following paragraph (b)), no Designated Bid Lender shall be required to make
payments with respect to any of its obligations under this Agreement or any
other Loan Document, or under the Co-Lender Agreement, except to the extent of
excess cash flow of such Designated Bid Lender (i.e., cash that is not otherwise
required to repay obligations of such Designated Bid Lender that are then due
and payable).
(b) Notwithstanding any other provision of this Agreement, any other
Loan Document or the Co-Lender Agreement: regardless of any designation of a
Designated Bid Lender hereunder, the Designating Bank making such designation
(i) shall be and remain obligated to Borrower, Administrative Agent and each of
the other Banks and other Designated Bid Lenders for each and every one of the
obligations of the Designating Bank and its Designated Bid Lender with respect
to this Agreement, any other Loan Document or the Co-Lender Agreement
(including, without limitation, any indemnification obligations under the Co-
Lender Agreement and other obligation to pay any amount otherwise payable to
Borrower by the Designated Bid Lender); and (ii) shall indemnify, defend and
hold Administrative Agent, Borrower, each Bank and each Designated Bid Lender
harmless from and against any and all losses, costs, expenses (including
reasonable attorneys' fees and the cost of any services of in-house counsel) and
liabilities incurred by any such Person in connection with or arising from (A)
(1) the non-performance by such Designating Bank's Designated Bid Lender of any
obligation assumed by the Designated Bid Lender under its Designation Agreement,
(2) any other act or omission of the Designated Bid Lender committed in
violation of the provisions of any Loan Document or the Co-Lender Agreement, or
(3) the failure of any representation or warranty made by such Designating
Bank's Designated Bid Lender for the benefit of Administrative Agent, Borrower,
any other Bank or any other Designated Bid Lender to be true and correct in all
material respects, or (B) such Designating Bank's nonperformance of any
obligation owed to its Designated Bid Lender under the Designation Agreement or
any other agreement between such Designating Bank and its Designated Bid Lender
with respect to the transactions contemplated hereby.
(c) Notwithstanding any designation hereunder, Borrower and
Administrative Agent shall continue to deal solely and directly with the
Designating Bank in connection with the Advances (including any Bid Loans made
by such
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Designating Bank's Designated Bid Lender), the Loan Documents and the Co-Lender
Agreement. Each Designating Bank shall serve as the administrative agent of its
Designated Bid Lender and shall on behalf of the Designated Bid Lender: (i)
receive any and all payments made for the benefit of the Designated Bid Lender
(and Borrower's and Administrative Agent's obligation to make any payment to the
Designated Bid Lender shall be satisfied upon payment of such amount to its
Designating Bank for the benefit of such Designated Bid Lender, without any duty
to see to the application thereof by such Designating Bank), and (ii) give and
receive all communications and notices and take all actions under any Loan
Document or the Co-Lender Agreement, including, without limitation, votes,
approvals, waivers, consents and amendments under or relating to this Agreement,
the other Loan Documents and the Co-Lender Agreement; and any notice or other
communication so delivered to a Designating Bank shall be deemed validly
delivered to its Designated Bid Lender, without any duty on the part of Borrower
or Administrative Agent to verify whether such notice or other communication is
actually delivered by such Designating Bank to its Designated Bid Lender.
Administrative Agent shall have no responsibility for, and shall not incur
liability to any Designated Bid Lender arising out of, the disposition by such
Designated Bid Lender's Designating Bank of any funds or notice or other
communication delivered to such Designating Bank for the account of such
Designated Bid Lender in accordance herewith. Any notice, communication, vote,
approval, waiver, consent or amendment of or with respect to any Loan Document
or the Co-Lender Agreement that is delivered or executed on behalf of any
Designated Bid Lender shall be signed by its Designating Bank as administrative
agent for the Designated Bid Lender (whether or not noted as such thereon), and
shall not be signed by the Designated Bid Lender on its own behalf. Borrower,
Administrative Agent, the Banks and the other Designated Bid Lenders may rely
thereon without any requirement that the Designated Bid Lender sign or
acknowledge the same. No Designated Bid Lender may assign or transfer all or any
portion of its interest hereunder or under any other Loan Documents, other than
(X) an assignment to the Designating Bank which originally designated such
Designated Bid Lender, or (Y) in accordance with the provisions of Section 11.3
or 11.4.
(d) A Designated Bid Lender shall not have any right to the payment
of any amount under the Loan Documents or the Co-Lender Agreement other than
with respect to (i) principal of and interest (including, to the extent,
interest at the Default Rate (as defined in the Note)) on Bid Loans made by such
Designated Bid Lender, (ii) late charges with respect to Bid Loans made by such
Designated Bid Lender that are not paid when due, and (iii) compensatory amounts
payable by Borrower in respect of Bid Loans made by such Designated Bid Lender
that are paid prior to the last day of the Bid Rate Interest Period applicable
thereto; and all other amounts payable by Borrower hereunder, under any other
Loan Document or under the Co-Lender Agreement shall be determined as if such
Designated Bid Lender's Designating Bank had not made such designation.
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12. MISCELLANEOUS
12.1 California Law.
---------------
This Agreement is governed by California law but without regard to
the choice of law rules of California.
12.2 Waiver of Jury Trial.
---------------------
EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO
TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (A) ARISING UNDER
THE LOAN DOCUMENTS, INCLUDING, WITHOUT LIMITATION, ANY PRESENT OR FUTURE
MODIFICATION THEREOF, OR (B) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL
TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THE LOAN
DOCUMENTS (AS NOW OR HEREAFTER MODIFIED) OR ANY OTHER INSTRUMENT, DOCUMENT OR
AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH, OR THE TRANSACTIONS
RELATED HERETO OR THERETO, IN EACH CASE WHETHER SUCH CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION IS NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN
CONTRACT OR TORT OR OTHERWISE. EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY
PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO
TO THE WAIVER OF ANY RIGHT THEY MIGHT OTHERWISE HAVE TO TRAIL BY JURY.
12.3 Presentment, Demands and Notice.
--------------------------------
Neither Administrative Agent nor any Bank or Designated Bid Lender
shall be under any duty or obligation to make or give any presentment, demands
for performances, notices of nonperformance, protests, notices of protest or
notices of dishonor in connection with any obligation or indebtedness under the
Loan Documents.
12.4 Attorneys' Fees.
----------------
In the event of a lawsuit or arbitration proceeding, including any
tort proceeding, between or among the parties hereto, the prevailing party is
entitled to recover costs and reasonable attorneys' fees (including any
allocated costs of in-house counsel) incurred in connection with the lawsuit or
arbitration proceeding, as determined by the court or arbitrator.
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12.5 Integration.
------------
The Loan Documents, including this Agreement: (a) integrate all the
terms and conditions incidental to the Loan Documents; (b) supersede all oral
negotiations and prior and other writings with respect to their subject matter;
and (c) are intended by the parties as the final expression of their agreement
with respect to the terms and conditions set forth in those documents and as the
complete and exclusive statement of the terms agreed to by the parties. If
there is any conflict between the terms, conditions and provisions of this
Agreement and those of any other agreement or instrument, including any of the
other Loan Documents, the terms, conditions and provisions of this Agreement
shall prevail. The Co-Lender Agreement addresses matters among the Banks, the
Designated Bid Lenders and Administrative Agent and is intended by the Banks,
the Designated Bid Lenders and Administrative Agent to supplement and be
compatible with and not abrogate the Loan Documents, and Borrower's rights,
obligations and liabilities shall not be diminished or increased by the Co-
Lender Agreement.
12.6 Electronic Notices.
-------------------
Any agreement of Administrative Agent to receive certain notices from
Borrower or the Banks (in their own capacities or in their capacities as
administrative agent for any Designated Bid Lender) by telephone or facsimile is
solely for their convenience and at their request. Administrative Agent shall
be entitled to rely on the authority of any Person giving such notice and
Administrative Agent shall not have any liability to Borrower, any Bank, any
Designated Bid Lender or other Persons on account of any action taken or not
taken by Administrative Agent in reliance upon such telephonic or facsimile
notice.
12.7 Notices.
--------
Notices and other communications that Borrower, Administrative Agent
or any Lender is required to deliver under any Loan Document, or that any such
Person desires to deliver to any other party to a Loan Document, shall be sent
to the address for such Person set forth on the signature pages hereto. As
provided in Section 11.5, any notice or other communication to a Designated Bid
Lender shall be sent to its Designating Bank. Except as otherwise specified:
(x) all notices or other communications sent by mail, if duly given, shall be
effective three (3) Business Days after deposit into the mails, postage prepaid,
(y) all notices or other communications sent by a nationally recognized
overnight courier service, if duly given, shall be effective one (1) Business
Day after delivery to such courier service (with the relevant fees paid or duly
provided for), and (z) all other notices or other communications, if duly given
or made, shall be effective upon receipt. Any party may change its address for
notices by notice delivered to Administrative Agent or Borrower, as the case may
be, in accordance with the provisions of this Section 12.7.
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12.8 No Bankruptcy Proceedings Against Designated Bid Lenders.
---------------------------------------------------------
Each of Borrower, the Banks, and Administrative Agent hereby agrees
that it will not institute against any Designated Bid Lender, or join with any
other Person in instituting against any Designated Bid Lender, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding under any
federal or state bankruptcy or similar law, at any time prior to the date that
is one year and one day after payment in full of the latest maturing commercial
paper note issued by such Designated Bid Lender.
12.9 Certain Acknowledgments by Borrower.
-------------------------------------
Borrower acknowledges that (i) it has been advised by counsel in the
negotiation, execution and delivery of this Agreement and the other Loan
Documents; and (ii) the relationship between Borrower, on the one hand, and
Administrative Agent and the Banks and Designated Bid Lenders, on the other
hand, in connection with the Loan Documents and the transactions contemplated
thereby is solely that of debtor and creditor; no joint venture is created
hereby or by the other Loan Documents or otherwise exists (among Borrower, the
Banks and the Designated Bid Lenders or between Borrower and Administrative
Agent) by virtue of the transactions contemplated hereby.
12.10 Successors and Assigns.
-----------------------
This Agreement is binding on each of the parties' successors and
assignees. Borrower agrees that it may not assign this Agreement or the other
Loan Documents without Administrative Agent's prior consent. Administrative
Agent, the Banks and the Designated Bid Lenders may sell participations in or
assign their rights under the Loan Documents in accordance with Section 11, and
may provide financial information about Borrower and the Guarantors to actual or
potential participants or assignees, without notice to or consent of Borrower.
12.11 No Third Parties Benefited.
---------------------------
This Agreement is made and entered into for the sole protection and
benefit of Borrower, Administrative Agent, the Banks and the Designated Bid
Lenders and their respective successors and assigns. No trust fund is created
by this Agreement and no other persons or entities (other than Indemnified
Persons) shall have any right of action under this Agreement or any right to the
proceeds of advances made pursuant to the Loan Documents.
12.12 Headings, Schedules, Exhibits.
------------------------------
(a) Headings and captions are for reference only and shall not affect
the interpretation or meaning of any provisions of this Agreement.
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(b) The schedule(s) and exhibit(s) to this Agreement are hereby
incorporated in this Agreement.
12.13 Interpretation.
---------------
(a) Time is of the essence in the performance of this Agreement by
Borrower.
(b) The word "include(s)" means "include(s), without limitation," and
the word "including" means "including but not limited to." No listing of
specific instances, items or matters in any way limits the scope or generality
of any language of this Agreement.
(c) Any accounting terms used in this Agreement which are not
specifically defined shall have the meanings customarily given them in
accordance with GAAP. All references herein to Borrower or any other Person, in
connection with any financial or related covenant, representation or
calculation, shall be understood to mean and refer to Borrower and such other
Person on a consolidated basis in accordance with GAAP, unless otherwise
specifically provided and subject in all events to any adjustments herein set
forth.
(d) Any time the phrase "to the best of Borrower's knowledge" or a
phrase similar thereto is used herein, it means: "to the actual knowledge of the
then officers of Borrower, after reasonable inquiry of those agents, employees
or contractors of Borrower who could reasonably be anticipated to have knowledge
with respect to the subject matter or circumstances in question and after review
of those documents or instruments which could reasonably be anticipated to be
relevant to the subject matter or circumstances in question."
(e) In each case where the consent or approval of Administrative
Agent or the Banks is required, or Administrative Agent's or the Banks' non-
obligatory action is requested by Borrower, such consent, approval or action
shall be in the sole and absolute discretion of Administrative Agent or the
Banks, as the case may be (subject, in the case of Administrative Agent, to
receipt of such authorizations of the Banks as may be required under the Co-
Lender Agreement), unless otherwise specifically indicated.
(f) Any time the word "or" is used herein, unless the context
otherwise clearly requires, it has the inclusive meaning represented by the
phrase "and/or". The words "hereof", "herein", "hereby", "hereunder" and similar
terms refer to this Agreement as a whole and not to any particular provision of
this Agreement. Article, section, subsection, clause, exhibit and schedule
references are to this Agreement unless otherwise specified. Any reference in
this Agreement to this Agreement or to any other Loan Document includes any and
all amendments, modifications, supplements, renewals or restatements thereto or
thereof, as applicable.
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12.14 Severability; Waivers; Amendments.
----------------------------------
This Agreement may not be modified or amended except by a written
agreement signed by the parties. Any consent or waiver under this Agreement
must be in writing. If any part of this Agreement is not enforceable, the rest
of the Agreement may be enforced. If Administrative Agent (with such consent of
any or all of the Banks as may be required under the Co-Lender Agreement) waives
a default, Administrative Agent and the Banks may nevertheless enforce a later
default. No waiver shall be construed as a continuing waiver. No waiver shall
be implied from Administrative Agent's, or any Bank's or Designated Bid
Lender's, delay in exercising or failure to exercise any right or remedy against
Borrower. Consent by Administrative Agent or the Banks to any act or omission
by Borrower shall not be construed as a consent to any other or subsequent act
or omission or as a waiver of the requirement for Administrative Agent's or the
Banks' consent to be obtained in any future or other instance. Administrative
Agent, the Banks and the Designated Bid Lenders retain all of their respective
rights and remedies, even if one or more Advances is made after the occurrence
of any default.
12.15 Publicity; Confidentiality.
---------------------------
(a) Publicity. Each Bank and Designated Bid Lender may refer to the
---------
credit facilities provided pursuant to the Loan Documents in its own promotional
and advertising materials.
Borrower shall not identify a Bank or Designated Bid Lender as a lender, except
with such Bank's or Designated Bid Lender's prior written consent, provided
through Administrative Agent in each instance.
(b) Confidentiality. Administrative Agent, and each of the Banks and
---------------
Designated Bid Lenders, understands that some of the information and documents
furnished to it pursuant to this Agreement or the other Loan Documents may be
confidential, and agrees that it will keep all non-public information, documents
and agreements so furnished to it confidential and will make no disclosure to
other Persons of such information or agreements until it shall have become
public, except (i) to the extent required in connection with matters involving
operations under or enforcement or amendment of the Loan Documents; (ii) in
accordance with Administrative Agent's or such Bank's or Designated Bid Lender's
obligations under law or regulations or pursuant to subpoenas or other legal
process to make information available to governmental agencies and examiners or
to others; (iii) to any corporate parent or (if such Affiliate is a financial
institution) other Affiliate of Administrative Agent or such Bank or Designated
Bid Lender, solely for purposes of the administration or enforcement of the
Loan, so long as such parent or other Affiliate agrees to accept such
information or agreement subject to the restrictions provided in this Section
12.15(b); (iv) to any participant of the Administrative Agent or such Lender
that agrees to keep such information, documents or
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agreement confidential in accordance with the restrictions provided in this
Section 12.15(b); (v) to Administrative Agent or to any other Bank or Designated
Bid Lender and Administrative Agent's and such other Bank's or Designated Bid
Lender's respective counsel and other professional advisors so long as such
Persons are instructed to keep such information confidential in accordance with
the provisions of this Section 12.15(b); (vi) to proposed assignees,
participants and Designated Bid Lenders that agree to keep such information,
documents or agreements confidential in accordance with the provisions of this
Section 12.15(b); or (g) with the prior written consent of Borrower (which shall
not be unreasonably withheld).
12.16 Counterparts.
-------------
This Agreement may be executed in counterparts each of which, when
executed, shall be deemed an original, and all such counterparts shall
constitute one and the same agreement.
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This Agreement is executed as of the date stated at the top of the first
page.
BRE PROPERTIES, INC., a Maryland
corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
----------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Executive Vice President & Chief Financial
Officer
By:
----------------------------------
Name:
Title:
Address for Notices: BRE Properties, Inc.
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
BANK OF AMERICA, NA, as a Bank
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Director
Pro Rata Share: 14.222222222222%
Commitment: $64,000,000
Address for Notices: Bank of America, N.A.
Real Estate Group - Structured Debt
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Phone: (▇▇▇)▇▇▇-▇▇▇▇
Fax: (▇▇▇)▇▇▇-▇▇▇▇
S-1
BANK ONE, NA, as a Bank and Syndication Agent
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Title: First Vice President
---------------------------------------
Pro Rata Share: 14.000000000000%
Commitment: $63,000,000
Address for Notices: Bank One, NA
1 Bank ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
COMMERZBANK AG NEW YORK AND
GRAND CAYMAN BRANCHES, as a Bank
and as Documentation Agent
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Title: Vice President
---------------------------------------
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Title: Assistant Vice President
---------------------------------------
Pro Rata Share: 14.000000000000%
Commitment: $63,000,000
Address for Notices: Commerzbank AG
2 World Financial Center
New York, New York 10281
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S-2
THE INDUSTRIAL BANK OF JAPAN,
LIMITED
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------
Title: General Manager
---------------------------------
Pro Rata Share: 7.777777777777%
Commitment: $35,000,000
Address for Notices: The Industrial Bank of Japan, Limited
Los Angeles, Agency
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
DRESDNER BANK AG. New York Branch
and Grand Cayman Branch
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
---------------------------------
By: /s/ Gabe Polyondy
------------------------------------
Name: Gabe Polyondy
----------------------------------
Title: Assistant Treasurer
---------------------------------
Pro Rata Share: 7.777777777777%
Commitment: $35,000,000
S-3
Address for Notices: Dresdner Bank AG,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
SANWA BANK CALIFORNIA
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Title: Vice President
---------------------------------
Pro Rata Share: 5.555555555555%
Commitment: $25,000,000
Address for Notices: Sanwa Bank California
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
MANUFACTURERS BANK
By: /s/ Cevill Lewis, Jr.
------------------------------------
Name: Cevill ▇▇▇▇▇ ▇▇.
----------------------------------
Title: Vice President
---------------------------------
Pro Rata Share: 3.333333333333%
Commitment: $15,000,000
S-4
Address for Notices: Manufacturers Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
U.S. BANK NATIONAL ASSOCIATION
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Title: Vice President
---------------------------------
Pro Rata Share: 5.555555555555%
Commitment: $25,000,000
Address for Notices: U.S. Bank N.A.
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
BANK HAPOALIM BM
By: /s/ Shloato ▇▇▇▇▇
------------------------------------
Name: Shloato ▇▇▇▇▇
----------------------------------
Title: Senior Vice President
---------------------------------
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
----------------------------------
Title: Vice President
---------------------------------
Pro Rata Share: 4.444444444444%
Commitment: $20,000,000
S-5
Address for Notices: BANK HAPOALIM BM
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
CHEVY CHASE BANK
By: /s/ ▇. ▇▇▇▇▇▇ ▇'▇▇▇▇▇
------------------------------------
Name: ▇. ▇▇▇▇▇▇ ▇'▇▇▇▇▇, III
----------------------------------
Title: Vice President
---------------------------------
Pro Rata Share: 4.444444444444%
Commitment: $20,000,000
Address for Notices: Chevy Chase Bank F.S.B.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
FIRST UNION NATIONAL BANK
By: /s/ ▇▇▇▇ Schissol
------------------------------------
Name: ▇▇▇▇ Schissol
----------------------------------
Title: Director
---------------------------------
Pro Rata Share: 7.777777777777%
Commitment: $35,000,000
S-6
Adresss for Notices: FIRST UNION NATIONAL BANK
REIT Banking Group
One First Union Center (NC 01 66)
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Phone: (▇▇▇)▇▇▇-▇▇▇▇
Fax: (▇▇▇)▇▇▇-▇▇▇▇
GUARANTY FEDERAL BANK, F.D.B
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇
----------------------------------
Title: Vice President
---------------------------------
Pro Rata Share: 5.555555555555%
Commitment: $25,000,000
Address for Notices: Guaranty Federal Bank, F.D.B.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
UNION BANK OF CALIFORNIA
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Title: Vice President
---------------------------------
Pro Rata Share: 5.555555555555%
Commitment: $25,000,000
Address for Notices: Union Bank of California
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇/▇▇/ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S-7
BANK OF AMERICA, N.A., as Administrative
Agent
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇
Managing Director
Address for Notices: Bank of America, N.A.
Real Estate Group - Structured Debt
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
S-8