EXHIBIT 4.1
TERM LOAN CREDIT AGREEMENT
DATED AS OF MAY 20, 2004
AMONG
DEVELOPERS DIVERSIFIED REALTY CORPORATION,
AS BORROWER,
BANC ONE CAPITAL MARKETS, INC.
AND WACHOVIA CAPITAL MARKETS, LLC,
AS LEAD ARRANGERS/BOOK RUNNERS,
AND
BANK ONE, NA,
AS ADMINISTRATIVE AGENT,
AND
▇▇▇▇▇ FARGO BANK, N.A.,
AS SYNDICATION AGENT,
AND
WACHOVIA BANK, NA,
AS DOCUMENTATION AGENT,
AND
THE SEVERAL LENDERS
FROM
TIME TO TIME PARTIES HERETO,
AS LENDERS
TERM LOAN CREDIT AGREEMENT
This Term Loan Credit Agreement, dated as of May 20 2004, is among
Developers Diversified Realty Corporation, a corporation organized under the
laws of the State of Ohio (the "Borrower"), Bank One, NA, a national banking
association, and the several banks, financial institutions and other entities
from time to time parties to this Agreement (collectively, the "Lenders"), Bank
One, NA, not individually, but as "Administrative Agent", ▇▇▇▇▇ Fargo Bank,
N.A., not individually, but as "Syndication Agent", and Wachovia Bank, NA, not
individually but as "Documentation Agent".
RECITALS
A. The Borrower is primarily engaged in the business of purchasing,
developing, owning, operating, leasing and managing retail, office and
industrial properties.
B. The Borrower is listed on the New York Stock Exchange and is qualified
as a real estate investment trust under Section 856 of the Code.
C. Borrower is acquiring certain retail assets known as the Benderson
Projects.
D. The Borrower, the Administrative Agent, and certain of the Lenders
entered into a Fifth Amended and Restated Credit Agreement dated as of December
12, 2003 as amended by that First Amendment to Credit Agreement dated as of May
13, 2004 (the "Revolving Credit Agreement"), pursuant to which the Lenders that
are parties thereto agreed to make loans to the Borrower in the aggregate amount
of up to $650,000,000.
E. Borrower has requested that the Administrative Agent act as
administrative agent for the Lenders and that the Lenders make Loans available
to Borrower pursuant to the terms of this Agreement to finance a portion of the
Borrower's obligations in connection with the acquisition of the Benderson
Projects.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"ABR Applicable Margin" means, as of any date, the Applicable Margin in
effect on such date with respect to Floating Rate Advances and Floating Rate
Loans.
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Borrower or any of its Subsidiaries (i) acquires any going business or all or
substantially all of the assets of any firm, corporation or division thereof,
whether through purchase of assets, merger or otherwise or (ii) directly or
indirectly acquires (in one transaction or as the most recent transaction in a
series of transactions) at least a majority (in number of votes) of the
securities of a corporation which have ordinary voting power for the election of
directors (other than securities having such power only by reason of the
happening of a contingency) or a majority (by percentage or voting power) of the
outstanding partnership interests of a partnership.
"Acquisition Asset" means any asset acquired by Borrower or any Subsidiary
after the Effective Date, until such asset has been owned for at least a period
of one (1) year, at which time it will no longer be treated as an Acquisition
Asset.
"Administrative Agent" means Bank One, NA in its capacity as agent for the
Lenders pursuant to Article X, and not in its individual capacity as a Lender,
and any successor Administrative Agent appointed pursuant to Article X.
"Advance" means all or any portion of the borrowing hereunder as portions
of the borrowing may be allocated among different interest rate options from
time to time in accordance with the terms hereof.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Aggregate Commitment" means the aggregate Commitments of all the Lenders,
which is $200,000,000.
"Agreement" means this Term Loan Credit Agreement, as it may be amended or
modified and in effect from time to time.
"Agreement Execution Date" means the date this Agreement has been fully
executed and delivered by all parties hereto.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Prime Rate for such day and (ii) the sum of
Federal Funds Effective Rate for such day plus 1/2% per annum.
"Applicable Margin" means the applicable margin set forth in the table in
Section 2.4 used in calculating the interest rate applicable to the various
Types of Advances, which shall vary from time to time in accordance with
Borrower's long term unsecured debt ratings.
"Arrangers" means Banc One Capital Markets, Inc. and Wachovia Capital
Markets, LLC.
"Article" means an article of this Agreement unless another document is
specifically referenced.
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"Assets Under Development" means, as of any date of determination, all
Projects and expansion areas of existing Projects owned by the Consolidated
Group and the Investment Affiliates which are then treated as assets under
development under GAAP, both such land and improvements under construction to be
valued for purposes of this Agreement at (i) 100% of then-current book value, as
determined in accordance with GAAP, for each Asset Under Development owned by
members of the Consolidated Group and (ii) the applicable Consolidated Group Pro
Rata Share of then-current book value, as determined in accordance with GAAP,
for each Asset Under Development owned by an Investment Affiliate; provided,
however, in no event, except for purposes of calculating the covenant contained
in Section 6.23(e), shall Assets Under Development include any Project or any
expansion area of an existing Project which is encumbered by a First Mortgage
Receivable as designated by the Borrower.
"Authorized Officer" means any of the President and Chief Executive
Officer, Executive Vice President and Chief Operating Officer, Vice President
and Chief Financial Officer or Vice President and General Counsel of the
Borrower, acting singly.
"Bank One" means Bank One, NA in its individual capacity, and its
successors.
"Benderson Projects" means those 110 retail assets acquired or to be
acquired by the Borrower, comprised of 18,800,000 square feet located mainly in
the Eastern United States.
"Borrower" means Developers Diversified Realty Corporation, a corporation
organized under the laws of the State of Ohio, and its successors and assigns.
"Borrowing Date" means the date on which the disbursement of the Loans
hereunder occurs.
"Borrowing Notice" is defined in Section 2.9.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of LIBOR Advances, a day (other than a Saturday or Sunday) on which
banks generally are open in Chicago, Illinois and New York, New York for the
conduct of substantially all of their commercial lending activities and on which
dealings in United States dollars are carried on in the London interbank market
and (ii) for all other purposes, a day (other than a Saturday or Sunday) on
which banks generally are open in Chicago, Illinois and New York, New York for
the conduct of substantially all of their commercial lending activities.
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person which is not a corporation
and any and all warrants or options to purchase any of the foregoing.
"Capitalized Lease" of a Person means any lease of Property imposing
obligations on such Person, as lessee thereunder, which are required in
accordance with GAAP to be capitalized on a balance sheet of such Person.
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"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with GAAP.
"Cash Equivalents" means, as of any date:
(i) securities issued or directly and fully guaranteed or insured
by the United States Government or any agency or
instrumentality thereof having maturities of not more than one
year from such date;
(ii) mutual funds organized under the United States Investment
Company Act rated AAm or AAm-G by S&P, P-1 by ▇▇▇▇▇'▇ and A by
Fitch;
(iii) certificates of deposit or other interest-bearing obligations
of a bank or trust company which is a member in good standing
of the Federal Reserve System having a short term unsecured
debt rating of not less than A-1 by S&P, not less than P-1 by
▇▇▇▇▇'▇ and F-1 by Fitch (or in each case, if no bank or trust
company is so rated, the highest comparable rating then given
to any bank or trust company, but in such case only for funds
invested overnight or over a weekend) provided that such
investments shall mature or be redeemable upon the option of
the holders thereof on or prior to a date one month from the
date of their purchase;
(iv) certificates of deposit or other interest-bearing obligations
of a bank or trust company which is a member in good standing
of the Federal Reserve System having a short term unsecured
debt rating of not less than A-1+ by S&P, and not less than
P-1 by ▇▇▇▇▇'▇ and which has a long term unsecured debt rating
of not less than A1 by ▇▇▇▇▇'▇ (or in each case, if no bank or
trust company is so rated, the highest comparable rating then
given to any bank or trust company, but in such case only for
funds invested overnight or over a weekend) provided that such
investments shall mature or be redeemable upon the option of
the holders thereof on or prior to a date three months from
the date of their purchase;
(v) bonds or other obligations having a short term unsecured debt
rating of not less than A-1+ by S&P and P-1+ by ▇▇▇▇▇'▇ and
having a long term debt rating of not less than A1 by ▇▇▇▇▇'▇
issued by or by authority of any state of the United States,
any territory or possession of the United States, including
the Commonwealth of Puerto Rico and agencies thereof, or any
political subdivision of any of the foregoing;
(vi) repurchase agreements issued by an entity rated not less than
A-1+ by S&P, and not less than P-1 by ▇▇▇▇▇'▇ which are
secured by U.S. Government securities of the type described in
clause (i) of this definition maturing on or prior to a date
one month from the date the repurchase agreement is entered
into;
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(vii) short term promissory notes rated not less than A-1+ by S&P,
and not less than P-1 by ▇▇▇▇▇'▇ maturing or to be redeemable
upon the option of the holders thereof on or prior to a date
one month from the date of their purchase; and
(viii) commercial paper (having original maturities of not more than
365 days) rated at least A-1+ by S&P and P-1 by ▇▇▇▇▇'▇ and
issued by a foreign or domestic issuer who, at the time of the
investment, has outstanding long-term unsecured debt
obligations rated at least A1 by ▇▇▇▇▇'▇.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Commitment" means the obligations of each of the Lenders to make a Loan
not exceeding the amount set forth opposite its signature below.
"Consolidated Capitalization Value" means, as of any date, an amount equal
to the sum of (i) Consolidated Cash Flow for the most recent period of two
consecutive fiscal quarters for which the Borrower has reported results
(excluding any portion of Consolidated Cash Flow attributable to: (A) Assets
Under Development, (B) Projects owned by Investment Affiliates which are
encumbered by First Mortgage Receivables, and (C) Acquisition Assets) multiplied
by 2, and divided by 0.090, plus (ii) Acquisition Assets valued at the lower of
their acquisition cost or market value, as determined in accordance with GAAP.
"Consolidated Cash Flow" means, for any period, an amount equal to (a)
Funds From Operations for such period plus (b) Consolidated Interest Expense for
such period.
"Consolidated Debt Service" means, for any period, without duplication,
(a) Consolidated Interest Expense for such period plus (b) the aggregate amount
of scheduled principal payments attributable to Consolidated Outstanding
Indebtedness (excluding optional prepayments and scheduled principal payments in
respect of any such Indebtedness which is not amortized through equal periodic
installments of principal and interest over the term of such Indebtedness)
required to be made during such period by any member of the Consolidated Group
plus (c) a percentage of all such scheduled principal payments required to be
made during such period by any Investment Affiliate on Indebtedness taken into
account in calculating Consolidated Interest Expense, equal to the greater of
(x) the percentage of the principal amount of such Indebtedness for which any
member of the Consolidated Group is liable and (y) the Consolidated Group Pro
Rata Share of such Investment Affiliate.
"Consolidated Group" means the Borrower and all Subsidiaries which are
consolidated with it for financial reporting purposes under GAAP.
"Consolidated Group Pro Rata Share" means, with respect to any Investment
Affiliate, the percentage of the total equity ownership interests held by the
Consolidated Group in the aggregate, in such Investment Affiliate determined by
calculating the greater of (i) the percentage of the issued and outstanding
stock, partnership interests or membership interests in such Investment
Affiliate held by the Consolidated Group in the aggregate and (ii) the
percentage of the total book value of such Investment Affiliate that would be
received by the
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Consolidated Group in the aggregate, upon liquidation of such Investment
Affiliate, after repayment in full of all Indebtedness of such Investment
Affiliate.
"Consolidated Interest Expense" means, for any period without duplication,
the sum of (a) the amount of interest expense, determined in accordance with
GAAP, of the Consolidated Group for such period attributable to Consolidated
Outstanding Indebtedness during such period plus (b) the Consolidated Group Pro
Rata Share of any interest expense, determined in accordance with GAAP, of any
Investment Affiliate, for such period, whether recourse or non-recourse less (c)
with respect to each consolidated Subsidiary of the Borrower in which the
Borrower does not directly or indirectly hold a 100% ownership interest, a
percentage of the interest expense attributable to such consolidated Subsidiary
which is included under clause (a) of this definition and which is not related
to Indebtedness which is a Guarantee Obligation of the Borrower equal to the
percentage ownership in such consolidated Subsidiary which is not held either
(i) directly or indirectly by the Borrower, or (ii) by holders of operating
partnership units in such consolidated Subsidiary which are convertible into
stock of the Borrower.
"Consolidated Market Value" means, as of any date, an amount equal to the
sum of (a) the Consolidated Capitalization Value as of such date, plus (b) the
value of Unrestricted Cash and Cash Equivalents, plus (c) the lesser of (i) the
value of Assets Under Development, or (ii) ten percent (10%) of the Consolidated
Capitalization Value plus (d) the lesser of (i) 100% of the then-current value
under GAAP of all First Mortgage Receivables or (ii) five percent (5%) of the
Consolidated Capitalization Value, plus (e) the lesser of (i) 100% of the
then-current book value, as determined in accordance with GAAP, of Developable
Land, or (ii) 5% of total Consolidated Capitalization Value plus (f) cash from
like-kind exchanges on deposit with a qualified intermediary (provided that the
amount included in Consolidated Market Value pursuant to this clause (f) shall
not exceed 5% of the Value of Unencumbered Assets, except that such cap shall be
$200,000,000 during the 1031 exchange period relating to the sale of assets to
the Macquarie Fund from the initial two closings of the Macquarie Fund).
"Consolidated Net Income" means, for any period, consolidated net income
(or loss) of the Consolidated Group for such period determined on a consolidated
basis in accordance with GAAP; plus that portion of any amount deducted as
minority equity interest in calculating such consolidated net income which is
attributable to minority interest holders holding operating partnership units in
a member of the Consolidated Group which are convertible into stock in the
Borrower, but provided that there shall be excluded (a) the income (or deficit)
of any other Person accrued prior to the date it becomes a Subsidiary of the
Borrower or is merged into or consolidated with the Borrower or any of its
Subsidiaries and (b) the undistributed earnings of any Subsidiary which has not
furnished a Subsidiary Guaranty to the extent that the declaration or payment of
dividends or similar distributions by such Subsidiary is not at the time
permitted by the terms of any contractual obligation or requirement of law
applicable to such Subsidiary.
"Consolidated Net Worth" means, as of any date of determination, an amount
equal to (a) Consolidated Market Value minus (b) Consolidated Outstanding
Indebtedness as of such date.
"Consolidated Outstanding Indebtedness" means, as of any date of
determination, without duplication, the sum of (a) all Indebtedness of the
Consolidated Group outstanding at
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such date, determined on a consolidated basis in accordance with GAAP, plus (b)
the applicable Consolidated Group Pro Rata Share of any Indebtedness of each
Investment Affiliate other than Indebtedness of such Investment Affiliate to a
member of the Consolidated Group, less (c) with respect to each consolidated
Subsidiary of the Borrower in which the Borrower does not directly or indirectly
hold a 100% ownership interest, a percentage of any Indebtedness of such
consolidated Subsidiary which is not a Guarantee Obligation of the Borrower
equal to the percentage ownership interest in such consolidated Subsidiary which
is not held directly or indirectly by the Borrower.
"Consolidated Secured Indebtedness" means, as of any date of
determination, without duplication, the sum of (a) the aggregate principal
amount of that portion of the Consolidated Outstanding Indebtedness which is
secured by any Lien on the Property of Borrower or its Subsidiaries, without
regard to recourse, plus (b) the excess, if any, over $5,000,000, of the sum of
(x) the aggregate principal amount of all Senior Unsecured Indebtedness of the
Subsidiaries of the Borrower which have not furnished Subsidiary Guaranties,
determined on a consolidated basis in accordance with GAAP and (y) a percentage
of the aggregate principal amount of all Indebtedness of each Investment
Affiliate equal to the greater of (x) the percentage of such Indebtedness for
which any member of the Consolidated Group is liable and (z) the Consolidated
Group Pro Rata Share of such Investment Affiliate.
"Consolidated Senior Unsecured Indebtedness" means, as of any date of
determination, the aggregate principal amount of all Senior Unsecured
Indebtedness of the Consolidated Group outstanding at such date, including
without limitation all the outstanding Indebtedness under this Agreement and the
Revolving Credit Agreement as of such date, determined on a consolidated basis
in accordance with GAAP.
"Controlled Group" means all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower or any of its Subsidiaries, are treated as a
single employer under Section 414 of the Code.
"Conversion/Continuation Notice" is defined in Section 2.10.
"Default" means an event described in Article VII.
"Defaulting Lender" means any Lender which fails or refuses to perform its
obligations under this Agreement within the time period specified for
performance of such obligation, or, if no time frame is specified, if such
failure or refusal continues for a period of five Business Days after written
notice from the Administrative Agent; provided that if such Lender cures such
failure or refusal, such Lender shall cease to be a Defaulting Lender.
"Default Rate" means the interest rate which may apply during the
continuance of a Default pursuant to Section 2.12.
"Developable Land" means land which is appropriately zoned, has access to
all necessary utilities and has access to publicly dedicated streets.
"Disbursement" shall have the meaning set forth in Section 2.1.
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"Effective Date" means May 13, 2004, the date on which the First Amendment
to the Revolving Credit Agreement became effective.
"Environmental Laws" means any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect, in each case to the extent the
foregoing are applicable to the Borrower or any Subsidiary or any of their
respective assets or Projects.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Equity Value" means, with respect to a Subsidiary owned as of the
Agreement Execution Date or owned and in operation for a period of two or more
consecutive full fiscal quarters after the Agreement Execution Date, by the
Borrower or one of its other Subsidiaries, an amount equal to (A) the product of
(i) the sum of net income (or loss) for the most recent two consecutive fiscal
quarters without giving effect to depreciation and amortization, gains or losses
from extraordinary items, gains or losses on sales of real estate, and gains or
losses on investments in marketable securities for such period, plus the amount
of interest expense for such period on the aggregate principal amount of the
Indebtedness of such Subsidiary, multiplied by (ii) 2, divided by (B) 0.090, and
then minus (C) Indebtedness of the Subsidiary as of the date of determination.
For any Subsidiary formed or purchased after the Agreement Execution Date, until
it or its Properties have been owned and operated by the Borrower or one of its
other Subsidiaries for two or more consecutive full fiscal quarters, "Equity
Value" shall mean the Borrower's estimated annual Net Operating Income for the
Projects owned by such Subsidiary based on leases in existence at the date such
Subsidiary is formed or purchased divided by 0.090, and then minus the
Indebtedness of such Subsidiary as of the date of determination.
"Excluded Taxes" means, in the case of each Lender or applicable Lending
Installation and the Administrative Agent, taxes imposed on its overall net
income, and franchise taxes imposed on it, by any jurisdiction with taxing
authority over the Lender.
"Facility" shall have the meaning set forth in Section 2.1.
"Facility Termination Date" means May 18, 2007, subject to extension
pursuant to Section 2.22.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum 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 for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10 a.m. (Chicago
time) on such day on such transactions received by the Administrative Agent from
three Federal funds brokers of recognized standing selected by the
Administrative Agent in its sole discretion.
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"Financeable Ground Lease" means, a ground lease satisfactory to the
Required Lenders and the Administrative Agent's counsel in their reasonable
discretion, which must provide protections for a potential leasehold mortgagee
("Mortgagee") which include, among other things (i) a remaining term, including
any optional extension terms exercisable unilaterally by the tenant, of no less
than 25 years from the Agreement Execution Date, (ii) that the ground lease will
not be terminated until the Mortgagee has received notice of a default, has had
a reasonable opportunity to cure or complete foreclosure, and has failed to do
so, (iii) provision for a new lease on the same terms to the Mortgagee as tenant
if the ground lease is terminated for any reason, (iv) non-merger of the fee and
leasehold estates, (v) transferability of the tenant's interest under the ground
lease without any requirement for consent of the ground lessor unless based on
reasonable objective criteria as to the creditworthiness or line of business of
the transferee or delivery of customary assignment and assumption agreements
from the transferor and transferee, and (vi) that insurance proceeds and
condemnation awards (from the fee interest as well as the leasehold interest)
will be applied pursuant to the terms of the applicable leasehold mortgage.
"Financial Contract" of a Person means (i) any exchange - traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, or (ii) any Rate Management
Transaction.
"Financial Undertaking" of a Person means (i) any transaction which is the
functional equivalent of or takes the place of borrowing but which does not
constitute a liability on the consolidated balance sheet of such Person, or (ii)
any agreements, devices or arrangements designed to protect at least one of the
parties thereto from the fluctuations of interest rates, exchange rates or
forward rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, interest rate exchange agreements,
forward currency exchange agreements, interest rate cap or collar protection
agreements, forward rate currency or interest rate options.
"First Mortgage Receivable" means any Indebtedness owing to a member of
the Consolidated Group which is secured by a first-priority mortgage or deed of
trust on commercial real estate having a value in excess of the amount of such
Indebtedness and which has been designated by the Borrower as a "First Mortgage
Receivable" in its most recent compliance certificate.
"Fitch" means Fitch Inc. and its successors.
"Fixed Charges" shall mean, for any period, the sum of (i) Consolidated
Interest Expense, (ii) all scheduled principal payments due on account of
Consolidated Outstanding Indebtedness (excluding balloon payments), (iii) all
dividends payable on account of preferred stock or preferred operating
partnership units of the Borrower or any other Person in the Consolidated Group
and (iv) all ground lease payments to the extent not deducted as an expense in
calculating Consolidated Cash Flow.
"Floating Rate" means, for any day, a rate per annum equal to (i) the
Alternate Base Rate for such day plus (ii) ABR Applicable Margin for such day,
in each case changing when and as the Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which bears interest at the
Floating Rate.
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"Floating Rate Loan" means a Loan which bears interest at the Floating
Rate.
"Funds From Operations" means, for any period, the sum of (i) Consolidated
Net Income for such period, excluding (A) gains (losses) on sales of property,
(B) non-recurring charges and extraordinary items, and (C) non-cash charges
(including, without limitation, depreciation and amortization, and equity gains
(losses) from each Investment Affiliate included therein, but excluding any
amortization of deferred finance costs), plus (ii) the applicable Consolidated
Group Pro Rata Share of funds from operations of each Investment Affiliate that
is due to the Consolidated Group for such period, all determined on a consistent
basis. With regard to the foregoing sentence, for each consolidated Subsidiary
of the Borrower in which the Borrower does not directly or indirectly hold a
100% ownership interest, each of clauses (A), (B) and (C) shall exclude the pro
rata share of such item attributable to minority interest holders which do not
hold operating partnership units convertible to stock in the Borrower.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect from time to time, applied in a manner consistent with
that used in preparing the financial statements referred to in Section 6.1.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guarantee Obligation" means, as to any Person (the "guaranteeing
person"), any obligation (determined without duplication) of (a) the
guaranteeing person or (b) another Person (including, without limitation, any
bank under any Letter of Credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counter-indemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
of any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation of the
guaranteeing person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security therefor,
(ii) to advance or supply funds (1) for the purchase or payment of any such
primary obligation or (2) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the term
Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The amount of any Guarantee
Obligation of any guaranteeing person shall be deemed to be the maximum stated
amount of the primary obligation relating to such Guarantee Obligation (or, if
less, the maximum stated liability set forth in the instrument embodying such
Guarantee Obligation), provided, that in the absence of any such stated amount
or stated liability, the amount of such Guarantee Obligation shall be such
guaranteeing person's maximum reasonably anticipated liability in respect
thereof as determined by the Borrower in good faith.
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"Indebtedness" of any Person at any date means without duplication, (a)
all indebtedness of such Person for borrowed money including without limitation
any repurchase obligation or liability of such Person with respect to
securities, accounts or notes receivable sold by such Person, (b) all
obligations of such Person for the deferred purchase price of property or
services (other than current trade liabilities incurred in the ordinary course
of business and payable in accordance with customary practices), to the extent
such obligations constitute indebtedness for the purposes of GAAP, (c) any other
indebtedness of such Person which is evidenced by a note, bond, debenture or
similar instrument, (d) all Capitalized Lease Obligations, (e) all obligations
of such Person in respect of acceptances issued or created for the account of
such Person, (f) all Guarantee Obligations of such Person (excluding in any
calculation of consolidated Indebtedness of the Consolidated Group, Guarantee
Obligations of one member of the Consolidated Group in respect of primary
obligations of any other member of the Consolidated Group), (g) all
reimbursement obligations of such Person for letters of credit and other
contingent liabilities, (h) any Net ▇▇▇▇-to-Market Exposure and (i) all
liabilities secured by any lien (other than liens for taxes not yet due and
payable) on any property owned by such Person even though such Person has not
assumed or otherwise become liable for the payment thereof.
"Investment" of a Person means any loan, advance (other than commission,
travel and similar advances to officers and employees made in the ordinary
course of business), extension of credit (other than accounts receivable arising
in the ordinary course of business on terms customary in the trade), deposit
account or contribution of capital by such Person to any other Person or any
investment in, or purchase or other acquisition of, the stock, partnership
interests, notes, debentures or other securities of any other Person made by
such Person.
"Investment Affiliate" means any Person in which the Consolidated Group,
directly or indirectly, has an ownership interest, whose financial results are
not consolidated under GAAP with the financial results of the Consolidated
Group.
"Lenders" means the lending institutions listed on the signature pages of
this Agreement, their respective successors and assigns, any other lending
institutions that subsequently become parties to this Agreement.
"Lending Installation" means, with respect to a Lender, any office,
branch, subsidiary or affiliate of such Lender.
"LIBOR Advance" means an Advance that bears interest at the LIBOR Rate.
"LIBOR Applicable Margin" means, as of any date with respect to any LIBOR
Interest Period, the Applicable Margin in effect for such LIBOR Interest Period
as determined in accordance with Section 2.4 hereof.
"LIBOR Base Rate" means, with respect to a LIBOR Advance for the relevant
LIBOR Interest Period, the applicable British Bankers' Association LIBOR rate
for deposits in U.S. dollars as reported by any generally recognized financial
information service as of 11:00 a.m. (London time) two Business Days prior to
the first day of such LIBOR Interest Period, and having a maturity equal to such
LIBOR Interest Period, provided that, if no such British Bankers' Association
LIBOR rate is available to the Administrative Agent, the applicable LIBOR Base
Rate for the relevant LIBOR Interest Period shall instead be the rate determined
by
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the Administrative Agent to be the rate at which Bank One or one of its
Affiliate banks offers to place deposits in U.S. dollars with first-class banks
in the London interbank market at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of such LIBOR Interest Period, in the
approximate amount of Bank One's relevant LIBOR Loan and having a maturity equal
to such LIBOR Interest Period.
"LIBOR Interest Period" means a period of one, two, three or six months
commencing on a Business Day selected by the Borrower pursuant to this Agreement
(provided however from time to time, at the discretion of Administrative Agent,
a period may be of a duration of less than one month). Such LIBOR Interest
Period shall end on (but exclude) the day which corresponds numerically to such
date one, two, three or six months thereafter, provided, however, that if there
is no such numerically corresponding day in such next, second, third or sixth
succeeding month, such LIBOR Interest Period shall end on the last Business Day
of such next, second, third or sixth succeeding month. If a LIBOR Interest
Period would otherwise end on a day which is not a Business Day, such LIBOR
Interest Period shall end on the next succeeding Business Day, provided,
however, that if said next succeeding Business Day falls in a new calendar
month, such LIBOR Interest Period shall end on the immediately preceding
Business Day.
"LIBOR Loan" means a Loan which bears interest at a LIBOR Rate.
"LIBOR Rate" means, with respect to a LIBOR Advance for the relevant LIBOR
Interest Period, the sum of (i) the quotient of (a) the LIBOR Base Rate
applicable to such LIBOR Interest Period, divided by (b) one minus the Reserve
Requirement (expressed as a decimal) applicable to such LIBOR Interest Period,
plus (ii) the LIBOR Applicable Margin in effect from time to time during such
LIBOR Interest Period. The LIBOR Rate shall be rounded to the next higher 1/100
of 1% if the rate is not a multiple of 1/100 of 1%.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means, with respect to a Lender, such Lender's pro rata portion of
any Advance.
"Loan Documents" means this Agreement, the Notes, the Subsidiary Guaranty,
and any other document from time to time evidencing or securing indebtedness
incurred by the Borrower under this Agreement, as any of the foregoing may be
amended or modified from time to time.
"Macquarie Fund" means DDR Macquarie Fund LLC, a Delaware limited
liability company, together with its subsidiaries.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property or condition (financial or otherwise) of the Borrower and its
Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform its
obligations under the Loan Documents, or (iii) the validity or enforceability of
any of the Loan Documents.
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"Materials of Environmental Concern" means any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Maximum Legal Rate" means the maximum nonusurious interest rate, if any,
that at any time or from time to time may be contracted for, taken, reserved,
charged or received on the indebtedness evidenced by the Note and as provided
for herein or in the Note or other Loan Documents, under the laws of such state
or states whose laws are held by any court of competent jurisdiction to govern
the interest rate provisions of the Loan.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its successors.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"Net ▇▇▇▇-to-Market Exposure" of a Person means, as of any date of
determination, the excess (if any) of all unrealized losses over all unrealized
profits of such Person arising from Rate Management Transactions or any other
Financial Contract. "Unrealized losses" means the fair market value of the cost
to such Person of replacing such Rate Management Transaction or other Financial
Contract as of the date of determination (assuming the Rate Management
Transaction or other Financial Contract were to be terminated as of that date),
and "unrealized profits" means the fair market value of the gain to such Person
of replacing such Rate Management Transaction or other Financial Contract as of
the date of determination (assuming such Rate Management Transaction or other
Financial Contract were to be terminated as of that date).
"Net Operating Income" means, with respect to any Project for any period,
"property rental and other income" (as determined by GAAP) attributable to such
Project accruing for such period minus the amount of all expenses (as determined
in accordance with GAAP) incurred in connection with and directly attributable
to the ownership and operation of such Project for such period, including,
without limitation, Management Fees and amounts accrued for the payment of real
estate taxes and insurance premiums, but excluding interest expense or other
debt service charges and any non-cash charges such as depreciation or
amortization of financing costs. As used herein "Management Fees", means, with
respect to each Project for any period, an amount equal to (i) three percent
(3%) of the aggregate base rent and percentage rent due and payable under leases
with anchor tenants at such Project, plus (ii) three percent (3%) of the
aggregate base rent and percentage rent due and payable under leases with
tenants other than anchor tenants at such Project.
"Non-U.S. Lender" is defined in Section 3.5(iv).
"Note" means a promissory note, in substantially the form of Exhibit A
hereto, duly executed by the Borrower and payable to the order of a Lender in
the amount of its Loan, including any amendment, modification, renewal or
replacement of such promissory note.
"Notice of Assignment" is defined in Section 12.3.2.
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"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Notes, accrued and unpaid fees and all expenses, reimbursements
and indemnities and other obligations of Borrower to the Administrative Agent or
the Lenders arising under this Agreement or any of the other Loan Documents.
"Other Taxes" is defined in Section 3.5(ii).
"Participants" is defined in Section 12.2.1.
"Passive Non-Real Estate Investments" means stock or other equity
interests in or debt of entities not primarily involved in commercial real
estate development or ownership.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Percentage" means for each Lender the ratio that the outstanding balance
of such Lender's outstanding Loans bear to the outstanding balance of all Loans,
expressed as a percentage.
"Permitted Acquisitions" are defined in Section 6.15.
"Permitted Liens" are defined in Section 6.16.
"Person" means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, trust or other entity or organization, or
any government or political subdivision or any agency, department or
instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Prime Rate" means a rate per annum equal to the prime rate of interest
publicly announced from time to time by Bank One or its parent as its prime rate
(which is not necessarily the lowest rate charged to any customer), changing
when and as said prime rate changes. In the event that there is a successor to
the Administrative Agent by merger, or the Administrative Agent assigns its
duties and obligations to an Affiliate, then the term "Prime Rate" as used in
this Agreement shall mean the prime rate, base rate or other analogous rate of
the new Administrative Agent.
"Pre-Leased Project Under Construction" means a Project under development
(in accordance with GAAP) on which construction of buildings has been commenced
but which has not been substantially completed and occupied and over 50% of
which has been leased to a tenant or tenants pursuant to fully executed and
binding leases.
"Project" means any real estate asset owned by Borrower or any of its
Subsidiaries or any Investment Affiliate, and operated or intended to be
operated as a retail, office or industrial property.
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"Property" of a Person means any and all property, whether real, personal,
tangible, intangible, or mixed, of such Person, or other assets owned, leased or
operated by such Person.
"Purchasers" is defined in Section 12.3.1.
"Qualifying Jointly-Owned Subsidiary" means a Subsidiary which (i) is a
Subsidiary Guarantor but is not a Wholly-Owned Subsidiary, (ii) is governed by
organizational documents which prohibit voluntary sales of such Subsidiary's
Projects for a certain period of time after the contribution of such Project to
such Subsidiary or require approval from one or more of its limited partners or
non-managing members (other than a Wholly-Owned Subsidiary) for such voluntary
sales, and (iii) is governed by organizational documents which expressly
authorize the Borrower or the Wholly-Owned Subsidiary which is its general
partner or managing member to cause such Subsidiary to guaranty, or pledge such
Subsidiary's assets to secure, indebtedness of the Borrower.
"Rate Management Transaction" means any transaction (including an
agreement with respect thereto) now existing or hereafter entered into by the
Borrower which is a rate swap, basis swap, forward rate transaction, commodity
swap, commodity option, equity or equity index swap, equity or equity index
option, bond option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, forward transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
these transactions) or any combination thereof, whether linked to one or more
interest rates, foreign currencies, commodity prices, equity prices or other
financial measures.
"Recourse Indebtedness" means any Indebtedness of Borrower or any of its
Subsidiaries with respect to which the liability of the obligor is not limited
to the obligor's interest in specified assets securing such Indebtedness,
subject to customary limited exceptions for certain acts or types of liability.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor thereto or other
regulation or official interpretation of said Board of Governors relating to
reserve requirements applicable to member banks of the Federal Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Reportable Event" means a reportable event as defined in Section 4043 of
ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.
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"Required Lenders" means Lenders in the aggregate holding at least 66 2/3%
of the aggregate unpaid principal amount of the outstanding Advances.
"Reserve Requirement" means, with respect to a LIBOR Loan and LIBOR
Interest Period, that percentage (expressed as a decimal) which is in effect on
such day, as prescribed by the Federal Reserve Board or other governmental
authority or agency having jurisdiction with respect thereto for determining the
maximum reserves (including, without limitation, basic, supplemental, marginal
and emergency reserves) for eurocurrency funding (currently referred to as
"Eurocurrency Liabilities" in Regulation D) maintained by a member bank of the
Federal Reserve System.
"Revolving Credit Agreement" is defined in Recital D.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Senior Unsecured Indebtedness" means all Indebtedness other than
Subordinated Indebtedness of any Person that is not secured by a Lien on any
asset of such Person.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"S&P" means Standard & Poor's Ratings Group and its successors.
"Subordinated Indebtedness" means Indebtedness which is contractually
subordinated to the Obligations on customary subordination terms reasonably
acceptable to the Administrative Agent.
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, association, joint venture or similar business
organization more than 50% of the ownership interests having ordinary voting
power of which shall at the time be so owned or controlled. Unless otherwise
expressly provided, all references herein to a "Subsidiary" shall mean a
Subsidiary of the Borrower.
"Subsidiary Guarantor" means each Subsidiary of the Borrower which is
required to execute a Subsidiary Guaranty pursuant to Section 6.13.
"Subsidiary Guaranty" means the guaranty to be executed and delivered by
certain Subsidiaries of the Borrower, substantially in the form of Exhibit F, as
the same may be amended, supplemented or otherwise modified from time to time.
"Substantial Portion" means, with respect to the Property of the Borrower
and its Subsidiaries, Property which (i) represents more than 10% of the assets
of the Consolidated Group as would be shown in the consolidated financial
statements of the Consolidated Group as at the beginning of the twelve-month
period ending with the month immediately preceding the month in which such
determination is made, or (ii) is responsible for more than 10% of the
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consolidated net sales or of the consolidated net income of the Consolidated
Group as reflected in the financial statements referred to in clause (i) above.
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes and Other Taxes.
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating Rate
Advance or LIBOR Advance.
"Unencumbered Asset" means, any Project located in the United States 100%
of which is owned in fee simple or ground leased by the Borrower or a Subsidiary
Guarantor (provided that a Project which is ground leased shall be included as
an Unencumbered Asset only if such ground lease is a Financeable Ground Lease)
which, as of any date of determination, (a) is not subject to any Liens or
claims (including restrictions on transferability or assignability) of any kind
(including any such Lien, claim or restriction imposed by the organizational
documents of any Subsidiary Guarantor) other than (i) Permitted Liens set forth
in Sections 6.16(i) through 6.16(iv)), and (ii) restrictions on transferability
in the case of a Qualifying Jointly-Owned Subsidiary (b) is not subject to any
agreement (including (i) any agreement governing Indebtedness incurred in order
to finance or refinance the acquisition of such asset, and (ii) if applicable,
the organizational documents of any Subsidiary Guarantor) which prohibits or
limits the ability of the Borrower or any Subsidiary Guarantor to create, incur,
assume or suffer to exist any Lien upon any assets or Capital Stock of the
Borrower or any Subsidiary Guarantor, including, without limitation, any
negative pledge or similar covenant or restriction, (c) is not subject to any
agreement (including any agreement governing Indebtedness incurred in order to
finance or refinance the acquisition of such asset) which entitles any Person to
the benefit of any Lien (other than Permitted Liens set forth in Sections
6.16(i) through 6.16(iv)) on any assets or Capital Stock of the Borrower or any
Subsidiary Guarantor, or would entitle any Person to the benefit of any Lien
(other than Permitted Liens set forth in Sections 6.16(i) through 6.16(iv)) on
such assets or Capital Stock upon the occurrence of any contingency (including,
without limitation, pursuant to an "equal and ratable" clause), and (d) either
has been improved with an income-producing building or buildings which are
substantially completed and occupied or is a Pre-Leased Project Under
Construction. For the purposes of this Agreement, any Project of a Subsidiary
Guarantor shall not be deemed to be unencumbered unless (i) both such Project
and all Capital Stock of such Subsidiary Guarantor held by the Borrower is
unencumbered and (ii) each intervening entity between the Borrower and such
Subsidiary Guarantor does not have any Indebtedness for borrowed money or, if
such entity has any Indebtedness, such Indebtedness is unsecured and the entity
is a Subsidiary Guarantor.
"Unfunded Liabilities" means the amount (if any) by which the present
value of all vested nonforfeitable benefits under all Single Employer Plans
exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans.
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"Unmatured Default" means an event which but for the lapse of time or the
giving of notice, or both, would constitute a Default.
"Unrestricted Cash and Cash Equivalents" means, in the aggregate, all cash
and Cash Equivalents which are not pledged or otherwise restricted for the
benefit of any creditor and which are owned by members of the Consolidated Group
or Investment Affiliates, to be valued for purposes of this Agreement at (i)
100% of its then-current book value, as determined under GAAP, for any such
items owned by a member of the Consolidated Group or (ii) the applicable
Consolidated Group Pro Rata Share of its then-current book value, as determined
under GAAP, for any such items owned by an Investment Affiliate.
"Value of Unencumbered Assets" means, as of any date, the sum of (A) the
amount determined by dividing the Net Operating Income for each Project which is
an Unencumbered Asset (excluding the Net Operating Income for any Acquisition
Asset which is an Unencumbered Asset) as of such date for a calculation period
which shall be either the immediately preceding two (2) full fiscal quarters or,
if so requested by Borrower or the Administrative Agent, the one (1) immediately
preceding full fiscal quarter and the then current partial quarter (in all cases
as annualized) by 0.090 (provided that not more than 15% of the Value of
Unencumbered Assets with respect to Projects shall be attributable to
Unencumbered Assets which are ground leased) plus (B) for each Pre-Leased
Project Under Construction, 100% of the then-current book value, as determined
in accordance with GAAP, of such Pre-Leased Project Under Construction, provided
that the aggregate amount added to value under this clause (B) shall not exceed
ten percent (10%) of the total Value of Unencumbered Assets, plus (C) cash from
like-kind exchanges on deposit with a qualified intermediary (provided that not
more than 5% of the Value of Unencumbered Assets shall be attributable to the
proceeds of this clause (C), except that such cap shall be $200,000,000 during
the 1031 exchange period relating to the sale of assets to the Macquarie Fund
from the initial two closings of the Macquarie Fund). If a Project is no longer
owned as of the date of determination, then no value shall be included from such
Project, except for purposes of such financial covenant comparing the Net
Operating Income from Unencumbered Assets to Consolidated Interest Expense under
this Agreement. Notwithstanding the foregoing and with respect to any
Acquisition Asset which is an Unencumbered Asset, each such Acquisition Asset
shall be valued at the lower of its acquisition cost or market value, as
determined in accordance with GAAP.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of the
outstanding voting securities of which shall at the time be owned or controlled,
directly or indirectly, by such Person or one or more Wholly-Owned Subsidiaries
of such Person, or by such Person and one or more Wholly-Owned Subsidiaries of
such Person, or (ii) any partnership, association, joint venture or similar
business organization 100% of the ownership interests having ordinary voting
power of which shall at the time be so owned or controlled.
The foregoing definitions shall be equally applicable to both the singular
and plural forms of the defined terms.
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ARTICLE II
THE CREDIT
2.1 Commitments. This Facility ("Facility") is a three-year single draw
unsecured term loan in the maximum amount of the Aggregate Commitment. Subject
to the terms and conditions of this Agreement, each Lender severally agrees to
make a single disbursement (the "Disbursement") in an amount not to exceed its
Commitment to the Administrative Agent for the benefit of the Borrower. This
Facility is not a revolving credit facility and, except as provided in Section
3.3, any part of the Loans repaid may not be reborrowed. The commitment to lend
hereunder shall expire on May 28, 2004.
2.2 Final Principal Payment. Any outstanding Advances and all other unpaid
Obligations shall be paid in full by the Borrower on the Facility
Termination Date.
2.3 Ratable Loans. Each Advance hereunder shall consist of Loans made from
the several Lenders ratably in proportion to their respective Percentages. The
Advances may be Floating Rate Advances or LIBOR Advances, or a combination
thereof, selected by Borrower in accordance with Sections 2.9 and 2.10.
2.4 Applicable Margins. Each of the ABR Applicable Margin and the LIBOR
Applicable Margin to be used in calculating the interest rate applicable to
different Types of Advances shall vary from time to time in accordance with the
higher of Borrower's then applicable Moody's debt rating and S&P's debt rating
unless one of such two ratings is more than one rating category lower than the
other, in which case the average of the two different Applicable Margins shall
be used. The Applicable Margins shall be adjusted effective on the next Business
Day following any change in Borrower's Moody's debt rating and/or S&P's debt
rating, as the case may be. The applicable debt ratings and the Applicable
Margins are set forth in the following table:
-▇▇-
▇▇▇▇▇ ▇▇▇
APPLICABLE APPLICABLE
S&P RATING ▇▇▇▇▇'▇ RATING MARGIN MARGIN
---------- -------------- ---------- ----------
A- or higher A3 or higher 0.625% 0.00%
BBB+ Baa1 0.675% 0.00%
BBB Baa2 0.75% 0.00%
BBB- Baa3 1.00% 0.00%
Less than BBB- Less than Baa3 1.375% 0.125%
In the event that either S&P or Moody's shall discontinue their ratings of the
REIT industry or the Borrower, the Borrower may seek a debt rating from another
substitute rating agency reasonably satisfactory to the Administrative Agent and
the Borrower. For the period from the date of such discontinuance until the
first to occur of (i) the date the Borrower receives a debt rating from such new
rating agency or (ii) a date 180 days after such discontinuance, the single
rating from S&P or Moody's, as the case may be, shall be used to determine the
Applicable Margin. If the debt rating of the Borrower from such new rating
agency is not received within such 180 day period, or if both S&P and Moody's
shall discontinue their ratings of the REIT industry or the Borrower, the
Applicable Margin to be used for the calculation of interest on Advances
hereunder shall be the highest Applicable Margin for each Type.
If a rating agency downgrade or discontinuance results in an increase in
the ABR Applicable Margin or the LIBOR Applicable Margin and if such increase is
reversed and the affected Applicable Margin is restored within ninety (90) days
thereafter, at Borrower's request, Borrower shall receive a credit against
interest next due the Lenders equal to interest accrued at the differential
between such Applicable Margins during such period of downgrade or
discontinuance.
If a rating agency upgrade results in a decrease in the ABR Applicable
Margin or the LIBOR Applicable Margin and if such upgrade is reversed and the
affected Applicable Margin is restored within ninety (90) days thereafter,
Borrower shall be required to pay an amount to the Lenders equal to the interest
differential on the Advances during such period of upgrade.
2.5 Intentionally Omitted.
2.6 Other Fees. The Borrower agrees to pay all fees payable to the
Administrative Agent and the Arranger pursuant to the Borrower's letter
agreement with the Administrative Agent and the Arranger dated April
29, 2004.
2.7 Minimum Amount of Each LIBOR Advance. Each LIBOR Advance shall be in
the minimum amount of $1,000,000 (and in multiples of $100,000 if in excess
thereof).
2.8 Optional Principal Payments. The Borrower may from time to time pay,
without penalty or premium, all or any part of outstanding Floating Rate
Advances provided notice is
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given to the Administrative Agent not later than 10:00 a.m. (Chicago time) on
the date of payment. A LIBOR Advance may be paid on the last day of the
applicable LIBOR Interest Period or, if and only if the Borrower pays any
amounts due to the Lenders under Sections 3.4 and 3.5 as a result of such
prepayment, on a day prior to such last day, provided notice is given to
Administrative Agent not later than 10:00 a.m. (Chicago time) on the Business
Day preceding the date of prepayment. All prepayments shall be in a minimum
amount of $5,000,000.
2.9 Method of Selecting Types and Interest Periods for New Advances. The
Borrower shall select the Type of Advance and, in the case of each LIBOR
Advance, the LIBOR Interest Period applicable to each Advance from time to time.
The Borrower shall give the Administrative Agent irrevocable notice (a
"Borrowing Notice") (i) not later than 9:00 a.m. Chicago time on the Borrowing
Date if the disbursement is comprised entirely of a Floating Rate Advance, and
(ii) not later than 10:00 a.m. Chicago time, at least three (3) Business Days
before the Borrowing Date if the disbursement includes one or more LIBOR
Advances specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each LIBOR Advance, the LIBOR Interest Period
applicable thereto.
The Administrative Agent shall provide a copy to the Lenders by facsimile
of its standard notice regarding the Advances selected pursuant to the Borrowing
Notice and each Conversion/Continuation Notice not later than the close of
business on the Business Day it is received. Each Lender shall make available
its Loan or Loans, in funds immediately available in Chicago, Illinois to the
Administrative Agent at its address specified pursuant to Article XIII on the
Borrowing Date not later than noon (Chicago time). The Administrative Agent will
make the funds so received from the Lenders available to the Borrower at the
Administrative Agent's aforesaid address.
No LIBOR Interest Period may end after the Facility Termination Date and,
unless the Lenders otherwise agree in writing, in no event may there be more
than ten (10) different Interest Periods for LIBOR Advances outstanding at any
one time.
2.10 Conversion and Continuation of Outstanding Advances. Floating Rate
Advances shall continue as Floating Rate Advances unless and until such Floating
Rate Advances are converted into LIBOR Advances. Each LIBOR Advance shall
continue as a LIBOR Advance until the end of the then applicable LIBOR Interest
Period therefor, at which time such LIBOR Advance shall be automatically
converted into a Floating Rate Advance unless the Borrower shall have given the
Administrative Agent a Conversion/Continuation Notice requesting that, at the
end of such LIBOR Interest Period, such LIBOR Advance either continue as a LIBOR
Advance for the same or another LIBOR Interest Period or be converted to a
Floating Advance. Subject to the terms of Section 2.7, the Borrower may elect
from time to time to convert all or any part of an Advance of any Type into any
other Type or Types of Advances; provided that any conversion of any LIBOR
Advance shall be made on, and only on, the last day of the LIBOR
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Interest Period applicable thereto. The Borrower shall give the Administrative
Agent irrevocable notice (a "Conversion/Continuation Notice") of each
conversion/continuation of an Advance not later than 10:00 a.m. (Chicago time)
at least three Business Days prior to the date of the request into, or
continuation of a LIBOR Advance, specifying:
(i) the requested date which shall be a Business Day, of such
conversion or continuation;
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued (the amount of each Advance shall be subject to the
minimum amount and increments set forth in Section 2.7); and
(iii) the amount and Type(s) of Advance(s) into which such Advance
is to be converted or continued and, in the case of a conversion into or
continuation of a LIBOR Advance, the duration of the LIBOR Interest Period
applicable thereto.
2.11 Changes in Interest Rate, Etc. Each Floating Rate Advance shall bear
interest on the outstanding principal amount thereof, for each day from and
including the date such Advance is made or is converted from a LIBOR Advance
into a Floating Rate Advance pursuant to Section 2.10 to but excluding the date
it becomes due or is converted into a LIBOR Advance pursuant to Section 2.10
hereof, at a rate per annum equal to the Floating Rate for such day. Changes in
the rate of interest on that portion of any Advance maintained as a Floating
Rate Advance will take effect simultaneously with each change in the Alternate
Base Rate. Each LIBOR Advance shall bear interest from and including the first
day of the LIBOR Interest Period applicable thereto to (but not including) the
last day of such LIBOR Interest Period at the interest rate determined as
applicable to such LIBOR Advance.
2.12 Rates Applicable After Default. Notwithstanding anything to the
contrary contained in Section 2.9 or 2.10, during the continuance of a Default
or Unmatured Default the Required Lenders may, at their option, by notice to the
Borrower (which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that no Advance may be made as,
converted into or continued as a LIBOR Advance. During the continuance of a
Default the Required Lenders may, at their option, by notice to the Borrower
(which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 8.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that (i) each LIBOR Advance shall
bear interest for the remainder of the applicable LIBOR Interest Period at the
rate otherwise applicable to such LIBOR Interest Period plus 2% per annum and
(ii) each Floating Rate Advance shall bear interest at a rate per annum equal to
the Floating Rate otherwise applicable to the Floating Rate Advance plus 2% per
annum.
2.13 Method of Payment.
(i) All payments of the Obligations hereunder shall be made, without
setoff, deduction, or counterclaim, in immediately available funds to the
Administrative Agent at the Administrative Agent's address specified
pursuant to Article XIII, or at any other Lending Installation of the
Administrative Agent specified in writing by the Administrative Agent to
the Borrower, by noon (Chicago time) on the date when due and
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shall be applied ratably by the Administrative Agent among the Lenders in
accordance with their respective percentages.
(ii) As provided elsewhere herein, all Lenders' interests in the
Advances and the Loan Documents shall be ratable undivided interests and
none of such Lenders' interests shall have priority over the others. Each
payment delivered to the Administrative Agent for the account of any
Lender or amount to be applied or paid by the Administrative Agent to any
Lender shall be paid promptly (on the same day as received by the
Administrative Agent if received prior to noon (Chicago time) on such day
and otherwise on the next Business Day) by the Administrative Agent to
such Lender in the same type of funds that the Administrative Agent
received at its address specified pursuant to Article XIII or at any
Lending Installation specified in a notice received by the Administrative
Agent from such Lender. Payments received by the Administrative Agent but
not timely funded to the Lenders shall bear interest payable by the
Administrative Agent at the Federal Funds Effective Rate from the date due
until the date paid. The Administrative Agent is hereby authorized to
charge the account of the Borrower maintained with Bank One for each
payment of principal, interest and fees as it becomes due hereunder.
2.14 Notes; Telephonic Notices. Each Lender is hereby authorized to record
the principal amount of each of its Loans and each repayment on the schedule
attached to its Note, provided, however, that the failure to so record shall not
affect the Borrower's obligations under such Note. The Borrower hereby
authorizes the Lenders and the Administrative Agent to extend, convert or
continue Advances, effect selections of Types of Advances and to transfer funds
based on telephonic notices made by any Authorized Officer. The Borrower agrees
to deliver promptly to the Administrative Agent a written confirmation, if such
confirmation is requested by the Administrative Agent or any Lender, of each
telephonic notice signed by an Authorized Officer. If the written confirmation
differs in any material respect from the action taken by the Administrative
Agent and the Lenders, the records of the Administrative Agent and the Lenders
shall govern absent manifest error.
2.15 Interest Payment Dates; Interest and Fee Basis. Interest accrued on
each Advance shall be payable in arrears on the last day of each month, upon any
prepayment, whether by acceleration or otherwise, and at the Facility
Termination Date. Interest shall be calculated for actual days elapsed on the
basis of a 360-day year. Interest shall be payable for the day an Advance is
made but not for the day of any payment on the amount paid if payment is
received prior to noon (local time) at the place of payment. If any payment of
principal of or interest on an Advance shall become due on a day which is not a
Business Day, such payment shall be made on the next succeeding Business Day
and, in the case of a principal payment, such extension of time shall be
included in computing interest in connection with such payment.
2.16 Notification of Advances, Interest Rates and Prepayments. The
Administrative Agent will notify each Lender of the contents of each Borrowing
Notice, Conversion/Continuation Notice, and repayment notice received by it
hereunder not later than the close of business on the Business Day such notice
is received by the Administrative Agent. The Administrative Agent will notify
each Lender of the interest rate applicable to each LIBOR
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Advance promptly upon determination of such interest rate and will give each
Lender prompt notice of each change in the Alternate Base Rate.
2.17 Lending Installations. Subject to Section 3.6, each Lender may book
its Loans at any Lending Installation selected by such Lender and may change its
Lending Installation from time to time. All terms of this Agreement shall apply
to any such Lending Installation and the Notes shall be deemed held by each
Lender for the benefit of such Lending Installation. Each Lender may, by written
or telex notice to the Administrative Agent and the Borrower, designate a
Lending Installation through which Loans will be made by it and for whose
account Loan payments are to be made.
2.18 Non-Receipt of Funds by the Administrative Agent. Unless the Borrower
or a Lender, as the case may be, notifies the Administrative Agent prior to the
time at which it is scheduled to make payment to the Administrative Agent of (i)
in the case of a Lender, the proceeds of a Loan or (ii) in the case of the
Borrower, a payment of principal, interest or fees to the Administrative Agent
for the account of the Lenders, that it does not intend to make such payment,
the Administrative Agent may assume that such payment has been made. The
Administrative Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Administrative Agent, the recipient of such payment shall, on
demand by the Administrative Agent, repay to the Administrative Agent the amount
so made available together with interest thereon in respect of each day during
the period commencing on the date such amount was so made available by the
Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to (i) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day or (ii) in the case of payment by the
Borrower, the interest rate applicable to the relevant Loan. If such Lender so
repays such amount and interest thereon to the Administrative Agent within one
Business Day after such demand, all interest accruing on the Loan not funded by
such Lender during such period shall be payable to such Lender when received
from the Borrower.
2.19 Replacement of Lenders under Certain Circumstances. The Borrower
shall be permitted to replace any Lender which (a) is not capable of receiving
payments without any deduction or withholding of United States federal income
tax pursuant to Section 3.5, or (b) cannot maintain its LIBOR Loans at a
suitable Lending Installation pursuant to Section 3.3, with a replacement bank
or other financial institution; provided that (i) such replacement does not
conflict with any applicable legal or regulatory requirements affecting the
Lenders, (ii) no Default or (after notice thereof to Borrower) no Unmatured
Default shall have occurred and be continuing at the time of such replacement,
(iii) the Borrower shall repay (or the replacement bank or institution shall
purchase, at par) all Loans and other amounts owing to such replaced Lender
prior to the date of replacement, (iv) the Borrower shall be liable to such
replaced Lender under Sections 3.4 and 3.6 if any LIBOR Loan owing to such
replaced Lender shall be prepaid (or purchased) other than on the last day of
the LIBOR Interest Period relating thereto, (v) the replacement bank or
institution, if not already a Lender, and the terms and conditions of such
replacement, shall be reasonably satisfactory to the Administrative Agent, (vi)
the replaced Lender shall be obligated to make such replacement in accordance
with the provisions of Section 12.3 (provided that the Borrower shall be
obligated to pay the processing fee referred to therein), (vii) until such time
as such replacement shall be consummated, the Borrower shall pay
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all additional amounts (if any) required pursuant to Section 3.5 and (viii) any
such replacement shall not be deemed to be a waiver of any rights which the
Borrower, the Administrative Agent or any other Lender shall have against the
replaced Lender.
2.20 Application of Moneys Received. All moneys collected or received by
the Administrative Agent on account of the Facility directly or indirectly,
shall be applied in the following order of priority:
(i) to the payment of all reasonable costs incurred in the
collection of such moneys of which the Administrative Agent shall have
given notice to the Borrower;
(ii) to the reimbursement of any yield protection due to any of the
Lenders in accordance with Section 3.1;
(iii) first to interest then due to the Lenders (other than
Defaulting Lenders) until paid in full and then to principal for all
Lenders (other than Defaulting Lenders) in accordance with the Percentages
of the Lenders;
(iv) any other sums due to the Administrative Agent or any Lender
under any of the Loan Documents; and
(v) to the payment of any sums due to each Defaulting Lender as
their respective Percentages appear (provided that Administrative Agent
shall have the right to set-off against such sums any amounts due from
such Defaulting Lender).
2.21 Usury. This Agreement and each Note are subject to the express
condition that at no time shall Borrower be obligated or required to pay
interest on the principal balance of the Loan at a rate which could subject any
Lender to either civil or criminal liability as a result of being in excess of
the Maximum Legal Rate. If by the terms of this Agreement or the Loan Documents,
Borrower is at any time required or obligated to pay interest on the principal
balance due hereunder at a rate in excess of the Maximum Legal Rate, the
interest rate or the Default Rate, as the case may be, shall be deemed to be
immediately reduced to the Maximum Legal Rate and all previous payments in
excess of the Maximum Legal Rate shall be deemed to have been payments in
reduction of principal and not on account of the interest due hereunder. All
sums paid or agreed to be paid to Lender for the use, forbearance, or detention
of the sums due under the Loan, shall, to the extent permitted by applicable
law, be amortized, prorated, allocated, and spread throughout the full stated
term of the Loan until payment in full so that the rate or amount of interest on
account of the Loan does not exceed the Maximum Legal Rate of interest from time
to time in effect and applicable to the Loan for so long as the Loan is
outstanding.
2.22 Extension of Facility Termination Date. Borrower shall have two (2)
options to extend the Facility Termination Date for successive periods of twelve
(12) months each, upon satisfaction of the following conditions precedent:
(i) Borrower shall provide Administrative Agent with written notice
of Borrower's intent to exercise each extension option at least 30 days
prior to the existing
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Facility Termination Date (and Administrative Agent will promptly
thereafter notify Lenders);
(ii) As of the date of Borrower's delivery of notice of its intent
to exercise each extension option, and as of the then current Facility
Termination Date, no Default or Unmatured Default shall have occurred and
be continuing, and Borrower shall so certify in writing; and
(iii) Concurrently with Borrower's delivery of its notice of its
intent to exercise each extension option, Borrower shall pay to
Administrative Agent for the ratable benefit of the Lenders an extension
fee in an amount equal to 0.10% of the aggregate principal balance of all
Loans then outstanding hereunder.
ARTICLE III
CHANGE IN CIRCUMSTANCES
3.1 Yield Protection. If, on or after the date of this Agreement, the
adoption of any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
change in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency:
(i) subjects any Lender or any applicable Lending Installation to
any Taxes, or changes the basis of taxation of payments (other than with
respect to Excluded Taxes) to any Lender or the Issuing Bank in respect of
its LIBOR Loans or participations therein, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar requirement
against assets of, deposits with or for the account of, or credit extended
by, any Lender or any applicable Lending Installation (other than reserves
and assessments taken into account in determining the interest rate
applicable to LIBOR Advances), or
(iii) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Installation of making,
funding or maintaining its LIBOR Loans, or reduces any amount receivable
by any Lender or any applicable Lending Installation in connection with
its LIBOR Loans or participations therein, or requires any Lender or any
applicable Lending Installation to make any payment calculated by
reference to the amount of LIBOR Loans received by it, by an amount deemed
material by such Lender,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation of making or maintaining its LIBOR Loans or to
reduce the return received by such Lender or applicable Lending Installation, in
connection with such LIBOR Loans,or
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participations therein, then, within 30 days of demand by such Lender, the
Borrower shall pay such Lender such additional amount or amounts as will
compensate such Lender for such increased cost or reduction in amount received.
3.2 Changes in Capital Adequacy Regulations. If a Lender in good faith
determines the amount of capital required or expected to be maintained by such
Lender, any Lending Installation of such Lender or any corporation controlling
such Lender is increased as a result of a Change (as hereinafter defined), then,
within 30 days of demand by such Lender, the Borrower shall pay such Lender the
amount necessary to compensate for any shortfall in the rate of return on the
portion of such increased capital which such Lender in good faith determines is
attributable to this Agreement, its outstanding Loans or its obligation to make
Loans hereunder (after taking into account such Lender's policies as to capital
adequacy). "Change" means (i) any change after the date of this Agreement in the
Risk-Based Capital Guidelines (as hereinafter defined) or (ii) any adoption of
or change in any other law, governmental or quasi-governmental rule, regulation,
policy, guideline, interpretation, or directive (whether or not having the force
of law) after the date of this Agreement which affects the amount of capital
required or expected to be maintained by any Lender or any Lending Installation
or any corporation controlling any Lender. "Risk-Based Capital Guidelines" means
(i) the risk-based capital guidelines in effect in the United States on the date
of this Agreement, including transition rules, and (ii) the corresponding
capital regulations promulgated by regulatory authorities outside the United
States implementing the July 1988 report of the Basle Committee on Banking
Regulation and Supervisory Practices Entitled "International Convergence of
Capital Measurements and Capital Standards," including transition rules, and any
amendments to such regulations adopted prior to the date of this Agreement.
3.3 Availability of Types of Advances. If any Lender in good faith
determines that maintenance of any of its LIBOR Loans at a suitable Lending
Installation would violate any applicable law, rule, regulation or directive,
whether or not having the force of law, the Administrative Agent shall suspend
the availability of the affected Type of Advance and require any LIBOR Advances
of the affected Type to be repaid; or if the Required Lenders in good faith
determine that (i) deposits of a type or maturity appropriate to match fund
LIBOR Advances are not available, the Administrative Agent shall suspend the
availability of the affected Type of Advance with respect to any LIBOR Advances
made after the date of any such determination, or (ii) an interest rate
applicable to a Type of Advance does not accurately reflect the cost of making a
LIBOR Advance of such Type, then, if for any reason whatsoever the provisions of
Section 3.1 are inapplicable, the Administrative Agent shall suspend the
availability of the affected Type of Advance with respect to any LIBOR Advances
made after the date of any such determination. If the Borrower is required to so
repay a LIBOR Advance, the Borrower may concurrently with such repayment borrow
from the Lenders, in the amount of such repayment, a Loan bearing interest at
the Alternate Base Rate.
3.4 Funding Indemnification. If any payment of a LIBOR Advance occurs on a
date which is not the last day of the applicable LIBOR Interest Period, whether
because of acceleration, prepayment or otherwise, or a LIBOR Advance is not made
on the date specified by the Borrower for any reason other than default by the
Lenders or as a result of unavailability pursuant to Section 3.3, the Borrower
will indemnify each Lender for any loss or cost incurred by it resulting
therefrom, including, without limitation, any loss or cost in liquidating or
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employing deposits acquired to fund or maintain the LIBOR Advance, and shall pay
all such losses or costs within fifteen (15) days after written demand therefor.
Without limitation of any losses arising from changes in the LIBOR Rate adverse
to the Lenders, in no event will the administrative cost payable by the Borrower
as a result of such early payment or failure to make an advance exceed $250 per
occurrence per Lender.
3.5 Taxes.
(i) All payments by the Borrower to or for the account of any Lender
or the Administrative Agent hereunder or under any Note shall be made free
and clear of and without deduction for any and all Taxes. If the Borrower
shall be required by law to deduct any Taxes from or in respect of any sum
payable hereunder to any Lender or the Administrative Agent, (a) the sum
payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable
under this Section 3.5) such Lender or the Administrative Agent (as the
case may be) receives an amount equal to the sum it would have received
had no such deductions been made, (b) the Borrower shall make such
deductions, (c) the Borrower shall pay the full amount deducted to the
relevant authority in accordance with applicable law and (d) the Borrower
shall furnish to the Administrative Agent the original copy of a receipt
evidencing payment thereof within 30 days after such payment is made.
(ii) In addition, the Borrower hereby agrees to pay any present or
future stamp or documentary taxes and any other excise or property taxes,
charges or similar levies which arise from any payment made hereunder or
under any Note or from the execution or delivery of, or otherwise with
respect to, this Agreement or any Note ("Other Taxes").
(iii) The Borrower hereby agrees to indemnify the Administrative
Agent and each Lender for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed on
amounts payable under this Section 3.5) paid by the Administrative Agent
or such Lender and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto. Payments due under
this indemnification shall be made within 30 days of the date the
Administrative Agent or such Lender makes demand therefor pursuant to
Section 3.6.
(iv) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof (each a "Non-U.S. Lender")
agrees that it will, not more than ten Business Days after the date of
this Agreement, (i) deliver to each of the Borrower and the Administrative
Agent two duly completed copies of United States Internal Revenue Service
Form W-8BEN or W-8ECI, certifying in either case that such Lender is
entitled to receive payments under this Agreement without deduction or
withholding of any United States federal income taxes, and (ii) deliver to
each of the Borrower and the Administrative Agent a United States Internal
Revenue Form W-8 or W-9, as the case may be, and certify that it is
entitled to an exemption from United States backup withholding tax. Each
Non-U.S. Lender further undertakes to deliver to each of the Borrower and
the Administrative Agent (x) renewals or additional copies of such form
(or any successor form) on or before the date that such form expires or
becomes obsolete, and (y) after the occurrence of any event requiring a
change in the most recent forms so
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delivered by it, such additional forms or amendments thereto as may be
reasonably requested by the Borrower or the Administrative Agent. All
forms or amendments described in the preceding sentence shall certify that
such Lender is entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income taxes, unless
an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery
would otherwise be required which renders all such forms inapplicable or
which would prevent such Lender from duly completing and delivering any
such form or amendment with respect to it and such Lender advises the
Borrower and the Administrative Agent that it is not capable of receiving
payments without any deduction or withholding of United States federal
income tax.
(v) For any period during which a Non-U.S. Lender has failed to
provide the Borrower with an appropriate form pursuant to clause (iv),
above (unless such failure is due to a change in treaty, law or
regulation, or any change in the interpretation or administration thereof
by any governmental authority, occurring subsequent to the date on which a
form originally was required to be provided), such Non-U.S. Lender shall
not be entitled to indemnification under this Section 3.5 with respect to
Taxes imposed by the United States.
(vi) Any Lender that is entitled to an exemption from or reduction
of withholding tax with respect to payments under this Agreement or any
Note pursuant to the law of any relevant jurisdiction or any treaty shall
deliver to the Borrower (with a copy to the Administrative Agent), at the
time or times prescribed by applicable law, such properly completed and
executed documentation prescribed by applicable law as will permit such
payments to be made without withholding or at a reduced rate following
receipt of such documentation.
(vii) If the U.S. Internal Revenue Service or any other governmental
authority of the United States or any other country or any political
subdivision thereof asserts a claim that the Administrative Agent did not
properly withhold tax from amounts paid to or for the account of any
Lender (because the appropriate form was not delivered or properly
completed, because such Lender failed to notify the Administrative Agent
of a change in circumstances which rendered its exemption from withholding
ineffective, or for any other reason), such Lender shall indemnify the
Administrative Agent fully for all amounts paid, directly or indirectly,
by the Administrative Agent as tax, withholding therefor, or otherwise,
including penalties and interest, and including taxes imposed by any
jurisdiction on amounts payable to the Administrative Agent under this
subsection, together with all costs and expenses related thereto
(including attorneys fees and time charges of attorneys for the
Administrative Agent, which attorneys may be employees of the
Administrative Agent). The obligations of the Lenders under this Section
3.5(vii) shall survive the payment of the Obligations and
termination of this Agreement and any such Lender obligated to indemnify
the Administrative Agent shall not be entitled to indemnification from the
Borrower with respect to such amounts, whether pursuant to this Article or
otherwise, except to the extent the Borrower participated in the
actions giving rise to such liability.
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3.6 Lender Statements; Survival of Indemnity. To the extent reasonably
possible, each Lender shall designate an alternate Lending Installation with
respect to its LIBOR Loans to reduce any liability of the Borrower to such
Lender under Sections 3.1, 3.2 and 3.5 or to avoid the unavailability of LIBOR
Advances under Section 3.3, so long as such designation is not, in the
reasonable judgment of such Lender, disadvantageous to such Lender. Each Lender
shall deliver a written statement of such Lender to the Borrower (with a copy to
the Administrative Agent) as to the amount due, if any, under Section 3.1, 3.2,
3.4 or 3.5. Such written statement shall set forth in reasonable detail the
calculations upon which such Lender determined such amount and shall be final,
conclusive and binding on the Borrower in the absence of manifest error.
Determination of amounts payable under such Sections in connection with a LIBOR
Loan shall be calculated as though each Lender funded its LIBOR Loan through the
purchase of a deposit of the type and maturity corresponding to the deposit used
as a reference in determining the LIBOR applicable to such Loan, whether in fact
that is the case or not. Unless otherwise provided herein, the amount specified
in the written statement of any Lender shall be payable on demand after receipt
by the Borrower of such written statement. The obligations of the Borrower under
Sections 3.1, 3.2, 3.4 and 3.5 shall survive payment of the Obligations and
termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT
4.1 Advance. The Lenders shall not be required to make the single
disbursement contemplated hereunder unless:
(i) the Borrower, prior to or concurrently with such disbursement,
shall have paid all fees due and payable to the Lenders and the
Administrative Agent hereunder;
(ii) the Borrower shall have furnished to the Administrative Agent,
with sufficient copies for the Lenders, the following:
(a) The duly executed originals of the Loan Documents,
including the Notes, payable to the order of each of the Lenders,
this Agreement and the Subsidiary Guaranty;
(b) Certificates of good standing for the Borrower and the
top three Subsidiary Guarantors, from the State of Ohio for the
Borrower and the states of organization of the top three Subsidiary
Guarantors, certified by the appropriate governmental officer and
dated not more than thirty (30) days prior to the Agreement
Execution Date;
(c) Copies of the formation documents (including code of
regulations, if appropriate) of the Borrower and the top three
Subsidiary Guarantors by aggregate assets owned, certified by an
officer of the Borrower or such Subsidiary Guarantor, as
appropriate, together with all amendments thereto;
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(d) Incumbency certificates, executed by officers of the
Borrower and the top three Subsidiary Guarantors, which shall
identify by name and title and bear the signature of the Persons
authorized to sign the Loan Documents and to make borrowings
hereunder on behalf of the Borrower, upon which certificate the
Administrative Agent and the Lenders shall be entitled to rely until
informed of any change in writing by the Borrower or any such
Subsidiary Guarantor;
(e) Copies, certified by a Secretary or an Assistant
Secretary of the Borrower and each Subsidiary Guarantor, of the
Board of Directors' resolutions (and resolutions of other bodies, if
any are reasonably deemed necessary by counsel for any Lender)
authorizing the Advances provided for herein, with respect to the
Borrower, and the execution, delivery and performance of the Loan
Documents to be executed and delivered by the Borrower and each
Subsidiary Guarantor hereunder;
(f) A written opinion of the Borrower's and Subsidiary
Guarantors' counsel, addressed to the Lenders in substantially the
form of Exhibit B hereto or such other form as the Administrative
Agent may reasonably approve;
(g) A certificate, signed by an officer of the Borrower,
stating that on the initial Borrowing Date no Default or Unmatured
Default has occurred and is continuing and that all representations
and warranties of the Borrower are true and correct as of the
initial Borrowing Date provided that such certificate is in fact
true and correct;
(h) The most recent financial statements of the Borrower;
(i) UCC financing statement, judgment, and tax lien searches
with respect to the Borrower from the State of Ohio;
(j) Written money transfer instructions, in substantially
the form of Exhibit E hereto, addressed to the Administrative Agent
and signed by an Authorized Officer, together with such other
related money transfer authorizations as the Administrative Agent
may have reasonably requested;
(k) Evidence that all upfront fees due to each of the
Lenders under the terms of their respective commitment letters have
been paid, or will be paid out of the proceeds of the Advance
hereunder; and
(l) Such other documents as any Lender or its counsel may
have reasonably requested, the form and substance of which documents
shall be reasonably acceptable to the parties and their respective
counsel.
Notwithstanding anything in this Section 4.1 to the contrary,
Borrower shall not have to furnish or cause to be furnished to the
Administrative Agent any updated good standing certificates,
searches, organizational documents, officer certifications, or other
documentation listed in this Section 4.1 to the extent such
documentation was provided to the Administrative Agent in connection
with the
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Revolving Credit Agreement and Borrower certifies, in form and
substance reasonably satisfactory to the Administrative Agent, that
there has been no material change in the facts and circumstances
described in such documentation since the date it was previously
furnished to the Administrative Agent in connection with the
Revolving Credit Agreement.
(iii) There exists no Default or Unmatured Default;
(iv) The representations and warranties contained in Article V are
true and correct as of such Borrowing Date with respect to Borrower and to
any Subsidiary in existence on such Borrowing Date, except to the extent
any such representation or warranty is stated to relate solely to an
earlier date, in which case such representation or warranty shall be true
and correct on and as of such earlier date;
(v) There shall have been no change in the business, Property or
condition (financial or otherwise) of the Borrower and its subsidiaries
from the preparation date of the most recent consolidated financial
statements which could reasonably be expected to have a Material Adverse
Effect;
(vi) The acquisition of a portion of the Benderson Projects with a
purchase price of not less than $700,000,000 has been closed;
(vii) There shall have been no material adverse change in the
primary and secondary loan syndication markets or capital markets
generally that could impair the syndication of the facility; and
(viii) The Borrowing Notice shall constitute a representation and
warranty by the Borrower that the conditions contained in Section 4.1 have
been satisfied in accordance with the terms hereof concurrently with the
funding, including without limitation that any deliveries required
pursuant to subsection (b) above have been delivered, or have not changed
from the deliveries made in connection with the Revolving Credit
Agreement.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
5.1 Existence. Borrower is a corporation duly organized and validly
existing under the laws of the State of Ohio, with its principal place of
business in Beachwood, Ohio and is duly qualified as a foreign corporation,
properly licensed (if required), in good standing and has all requisite
authority to conduct its business in each jurisdiction in which its business is
conducted, except where the failure to be so qualified, licensed and in good
standing and to have the requisite authority would not have a Material Adverse
Effect. Each of Borrower's Subsidiaries is duly incorporated, validly existing
and in good standing under the laws of its jurisdiction of
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incorporation and has all requisite authority to conduct its business in each
jurisdiction in which its business is conducted.
5.2 Authorization and Validity. The Borrower has the corporate power and
authority and legal right to execute and deliver the Loan Documents and to
perform its obligations thereunder. The execution and delivery by the Borrower
of the Loan Documents and the performance of its obligations thereunder have
been duly authorized by proper corporate proceedings, and the Loan Documents
constitute legal, valid and binding obligations of the Borrower enforceable
against the Borrower in accordance with their terms, except as enforceability
may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally.
5.3 No Conflict; Government Consent. Neither the execution and delivery
by the Borrower of the Loan Documents, nor the consummation of the transactions
therein contemplated, nor compliance with the provisions thereof will violate
any law, rule, regulation, order, writ, judgment, injunction, decree or award
binding on the Borrower or any of its Subsidiaries or the Borrower's or any
Subsidiary's articles of incorporation or by-laws, or the provisions of any
indenture, instrument or agreement to which the Borrower or any of its
Subsidiaries is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder, except where such
violation, conflict or default would not have a Material Adverse Effect, or
result in the creation or imposition of any Lien in, of or on the Property of
the Borrower or a Subsidiary pursuant to the terms of any such indenture,
instrument or agreement. No order, consent, approval, license, authorization, or
validation of, or filing, recording or registration with, or exemption by, any
governmental or public body or authority, or any subdivision thereof, is
required to authorize, or is required in connection with the execution, delivery
and performance of, or the legality, validity, binding effect or enforceability
of, any of the Loan Documents other than the filing of a copy of this Agreement,
or the filing of information concerning this Agreement, with the Securities and
Exchange Commission.
5.4 Financial Statements; Material Adverse Change. All consolidated
financial statements of the Borrower and its Subsidiaries heretofore or
hereafter delivered to the Lenders were prepared in accordance with GAAP in
effect on the preparation date of such statements and fairly present in all
material respects the consolidated financial condition and operations of the
Borrower and its Subsidiaries at such date and the consolidated results of their
operations for the period then ended, subject, in the case of interim financial
statements, to normal and customary year-end adjustments. From the preparation
date of the most recent financial statements delivered to the Lenders through
the Agreement Execution Date, there was no change in the business, properties,
or condition (financial or otherwise) of the Borrower and its Subsidiaries which
could reasonably be expected to have a Material Adverse Effect.
5.5 Taxes. The Borrower and its Subsidiaries have filed all United
States federal tax returns and all other tax returns which are required to be
filed and have paid all taxes due pursuant to said returns or pursuant to any
assessment received by the Borrower or any of its Subsidiaries except such
taxes, if any, as are being contested in good faith and as to which adequate
reserves have been provided. No tax liens have been filed and remain outstanding
for amounts in excess of $250,000. The charges, accruals and reserves on the
books of the Borrower and its Subsidiaries in respect of any taxes or other
governmental charges are adequate.
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5.6 Litigation and Guarantee Obligations. Except as set forth on
Schedule 3 hereto or as set forth in written notice to the Administrative Agent
from time to time, there is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the knowledge of any of
their officers, threatened against or affecting the Borrower or any of its
Subsidiaries which could reasonably be expected to have a Material Adverse
Effect. Notwithstanding the disclosure of the litigation identified on Schedule
3 or in a notice to Administrative Agent, unless such disclosure has been
approved by the Required Lenders, the Borrower, based on consultation with its
counsel, represents that the Borrower is unlikely to suffer any material adverse
result in such litigation. The Borrower has no material contingent obligations
not provided for or disclosed in the financial statements referred to in Section
6.1 or as set forth in written notices to the Administrative Agent given from
time to time after the Agreement Execution Date on or about the date such
material contingent obligations are incurred.
5.7 Subsidiaries. Schedule 1 hereto contains, as of the Agreement
Execution Date, an accurate list of all of the presently existing Subsidiaries
of the Borrower, setting forth their respective jurisdictions of incorporation
or formation and the percentage of their respective capital stock or partnership
or membership interest owned by the Borrower or other Subsidiaries. Schedule 6
hereto contains, as of the Agreement Execution Date, an accurate list of all of
the presently existing Subsidiaries of the Borrower which own one or more
Projects that are not single purpose entities formed solely for the purpose of
owning Projects in connection with securitized Indebtedness which also have
restrictions on the creation of additional Indebtedness and other safeguards
typically imposed on such single-purpose entities in securitized financings. All
of the issued and outstanding shares of capital stock of such Subsidiaries that
are corporations have been duly authorized and issued and are fully paid and
non-assessable.
5.8 ERISA. The Unfunded Liabilities of all Single Employer Plans do not
in the aggregate exceed $1,000,000. Neither the Borrower nor any other member of
the Controlled Group has incurred, or is reasonably expected to incur, any
withdrawal liability to Multiemployer Plans in excess of $250,000 in the
aggregate. Each Plan complies in all material respects with all applicable
requirements of law and regulations, no Reportable Event has occurred with
respect to any Plan, neither the Borrower nor any other members of the
Controlled Group has withdrawn from any Plan or initiated steps to do so, and no
steps have been taken to reorganize or terminate any Plan.
5.9 Accuracy of Information. All factual information heretofore or
contemporaneously furnished by or on behalf of the Borrower or any of its
Subsidiaries to the Administrative Agent or any Lender for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all other such factual information hereafter furnished by or on behalf of the
Borrower or any of its Subsidiaries to the Administrative Agent or any Lender
will be, to the knowledge of Borrower, true and accurate (taken as a whole) on
the date as of which such information is dated or certified and not incomplete
by omitting to state any material fact necessary to make such information (taken
as a whole) not misleading in light of the circumstances and purposes for which
such information was provided at such time.
5.10 Regulation U. The Borrower has not used the proceeds of any Advance
to buy or carry any margin stock (as defined in Regulation U) in violation of
the terms of this Agreement.
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5.11 Material Agreements. Neither the Borrower nor any Subsidiary is a
party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could have a Material Adverse Effect, or (ii) any agreement or instrument
evidencing or governing Indebtedness, which default would constitute a Default
hereunder.
5.12 Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof, having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property, except for any
non-compliance which would not have a Material Adverse Effect. Neither the
Borrower nor any Subsidiary has received any notice to the effect that its
operations are not in material compliance with any of the requirements of
applicable federal, state and local environmental, health and safety statutes
and regulations or the subject of any federal or state investigation evaluating
whether any remedial action is needed to respond to a release of any toxic or
hazardous waste or substance into the environment, which non-compliance or
remedial action could have a Material Adverse Effect.
5.13 Ownership of Properties. Except as set forth on Schedule 2 hereto,
on the date of this Agreement, the Borrower and its Subsidiaries will have good
and marketable title, free of all Liens other than those permitted by Section
6.16, to all of the Property and assets reflected in the financial statements as
owned by it and will contemporaneously with the disbursement hereunder, have
good and marketable (or the equivalent) title, free and clear of all Liens other
than those permitted by Section 6.16 to the Benderson Projects which have been
acquired with a purchase price of not less than $700,000,000.
5.14 Investment Company Act. Neither the Borrower nor any Subsidiary is
an "investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended.
5.15 Public Utility Holding Company Act. Neither the Borrower nor any
Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.16 Solvency.
(i) Immediately after the Agreement Execution Date and immediately
following the making of each Loan and taking into account the Indebtedness
incurred hereunder, and after giving effect to the application of the
proceeds of such Loans, (a) the fair value of the assets of the Borrower
and its Subsidiaries on a consolidated basis, at a fair valuation, will
exceed the debts and liabilities, subordinated, contingent or otherwise,
of the Borrower and its Subsidiaries on a consolidated basis; (b) the
present fair saleable value of the Property of the Borrower and its
Subsidiaries on a consolidated basis will be greater than the amount that
will be required to pay the probable liability of the Borrower
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and its Subsidiaries on a consolidated basis on their debts and other
liabilities, subordinated, contingent or otherwise, as such debts and
other liabilities become absolute and matured; (c) the Borrower and its
Subsidiaries on a consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such debts and
liabilities become absolute and matured; and (d) the Borrower and its
Subsidiaries on a consolidated basis will not have unreasonably small
capital with which to conduct the businesses in which they are engaged as
such businesses are now conducted and are proposed to be conducted after
the date hereof.
(ii) The Borrower does not intend to, or to permit any of its
Subsidiaries to, and does not believe that it or any of its Subsidiaries
will, incur debts beyond its ability to pay such debts as they mature,
taking into account the timing of and amounts of cash to be received by it
or any such Subsidiary and the timing of the amounts of cash to be payable
on or in respect of its Indebtedness or the Indebtedness of any such
Subsidiary.
5.17 Insurance. The Borrower and its Subsidiaries carry insurance on
their Projects with financially sound and reputable insurance companies, in such
amounts, with such deductibles and covering such risks as are customarily
carried by companies engaged in similar businesses and owning similar Projects
in localities where the Borrower and its Subsidiaries operate, including,
without limitation:
(i) Property and casualty insurance (including coverage for flood
and other water damage for any Project located within a 100-year flood
plain) in the amount of the replacement cost of the improvements at the
Project (to the extent replacement cost insurance is maintained by
companies engaged in similar business and owning similar properties);
(ii) Builder's risk insurance for any Project under construction in
the amount of the construction cost of such Project;
(iii) Loss of rental income insurance in the amount not less than
one year's gross revenues from the Projects; and
(iv) Comprehensive general liability insurance in the amount of
$20,000,000 per occurrence.
5.18 REIT Status. The Borrower is in good standing on the New York Stock
Exchange, is qualified as a real estate investment trust under Section 856 of
the Code and currently is in compliance in all material respects with all
provisions of the Code applicable to the qualification of the Borrower as a real
estate investment trust.
5.19 Environmental Matters. Each of the following representations and
warranties is true and correct on and as of the Agreement Execution Date except
to the extent that the facts and circumstances giving rise to any such failure
to be so true and correct, in the aggregate, could not reasonably be expected to
have a Material Adverse Effect:
(a) To the best knowledge of the Borrower, the Projects of
the Borrower and its Subsidiaries do not contain any Materials of
Environmental
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Concern in amounts or concentrations which constitute a violation
of, or could reasonably give rise to liability of the Borrower or
any Subsidiary under, Environmental Laws.
(b) To the best knowledge of the Borrower, (i) the Projects
of the Borrower and its Subsidiaries and all operations at the
Projects are in compliance with all applicable Environmental Laws,
and (ii) with respect to all Projects owned by the Borrower and/or
its Subsidiaries (x) for at least two (2) years, have in the last
two years, or (y) for less than two (2) years, have for such period
of ownership, been in compliance in all material respects with all
applicable Environmental Laws.
(c) Neither the Borrower nor any of its Subsidiaries has
received any notice of violation, alleged violation, non-compliance,
liability or potential liability regarding environmental matters or
compliance with Environmental Laws with regard to any of the
Projects, nor does the Borrower have knowledge or reason to believe
that any such notice will be received or is being threatened.
(d) To the best knowledge of the Borrower, Materials of
Environmental Concern have not been transported or disposed of from
the Projects of the Borrower and its Subsidiaries in violation of,
or in a manner or to a location which could reasonably give rise to
liability of the Borrower or any Subsidiary under, Environmental
Laws, nor have any Materials of Environmental Concern been
generated, treated, stored or disposed of at, on or under any of the
Projects of the Borrower and its Subsidiaries in violation of, or in
a manner that could give rise to liability of the Borrower or any
Subsidiary under, any applicable Environmental Laws.
(e) No judicial proceedings or governmental or
administrative action is pending, or, to the knowledge of the
Borrower, threatened, under any Environmental Law to which the
Borrower or any of its Subsidiaries is or, to the Borrower's
knowledge, will be named as a party with respect to the Projects of
the Borrower and its Subsidiaries, nor are there any consent decrees
or other decrees, consent orders, administrative order or other
orders, or other administrative of judicial requirements outstanding
under any Environmental Law with respect to the Projects of the
Borrower and its Subsidiaries.
(f) To the best knowledge of the Borrower, there has been no
release or threat of release of Materials of Environmental Concern
at or from the Projects of the Borrower and its Subsidiaries, or
arising from or related to the operations of the Borrower and its
Subsidiaries in connection with the Projects in violation of or in
amounts or in a manner that could give rise to liability under
Environmental Laws.
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ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1 Financial Reporting. The Borrower will maintain, for itself and each
Subsidiary, a system of accounting established and administered in accordance
with GAAP, and furnish to the Lenders:
(i) As soon as available, but in any event not later than 45 days
after the close of each fiscal quarter, for the Borrower and its
Subsidiaries, an unaudited consolidated balance sheet as of the close of
each such period and the related unaudited consolidated statements of
income and retained earnings and of cash flows of the Borrower and its
Subsidiaries for such period and the portion of the fiscal year through
the end of such period, setting forth in each case in comparative form the
figures for the previous year, all certified by the Borrower's chief
financial officer or chief accounting officer;
(ii) As soon as available, but in any event not later than 45 days
after the close of each fiscal quarter, for the Borrower and its
Subsidiaries, the following reports in form and substance reasonably
satisfactory to the Lenders, all certified by the entity's chief financial
officer or chief accounting officer: a statement of Funds From Operations,
a statement of cash flows for each individual Project, a statement
detailing Consolidated Outstanding Indebtedness, Consolidated Secured
Indebtedness, and Consolidated Senior Unsecured Indebtedness, Consolidated
Cash Flow (with a breakdown between Unencumbered Assets and other assets),
a listing of capital expenditures, a report listing and describing all
newly acquired Projects, including their net operating income, cash flow,
cost and secured or unsecured Indebtedness assumed in connection with such
acquisition, if any, summary information and such other information on all
Projects as may be reasonably requested;
(iii) As soon as available, but in any event not later than 90 days
after the close of each fiscal year, for the Borrower and its
Subsidiaries, audited financial statements, including a consolidated
balance sheet as at the end of such year and the related consolidated
statements of income and retained earnings and of cash flows for such
year, setting forth in each case in comparative form the figures for the
previous year, without a "going concern" or like qualification or
exception, or qualification arising out of the scope of the audit,
prepared by PricewaterhouseCoopers (or other independent certified public
accountants of nationally recognized standing reasonably acceptable to
Administrative Agent);
(iv) As soon as available, but in any event not later than 90 days
after the close of each fiscal year, for the Borrower and its
Subsidiaries, a statement detailing the contributions to Consolidated Cash
Flow from each individual Project for the prior fiscal
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year in form and substance reasonably satisfactory to the Lenders,
certified by the entity's chief financial officer or chief accounting
officer;
(v) Together with the quarterly and annual financial statements
required hereunder, a compliance certificate in substantially the form of
Exhibit C hereto signed by the Borrower's chief financial officer or chief
accounting officer showing the calculations and computations necessary to
determine compliance with this Agreement and stating that, to such
officer's knowledge, no Default or Unmatured Default exists, or if, to
such officer's knowledge, any Default or Unmatured Default exists, stating
the nature and status thereof;
(vi) As soon as possible and in any event within 10 days after a
responsible officer of the Borrower knows that any Reportable Event has
occurred with respect to any Plan, a statement, signed by the chief
financial officer of the Borrower, describing said Reportable Event and
the action which the Borrower proposes to take with respect thereto;
(vii) As soon as possible and in any event within 10 days after
receipt by a responsible officer of the Borrower, a copy of (a) any notice
or claim to the effect that the Borrower or any of its Subsidiaries is or
may be liable to any Person as a result of the release by the Borrower,
any of its Subsidiaries, or any other Person of any toxic or hazardous
waste or substance into the environment, and (b) any notice alleging any
violation of any federal, state or local environmental, health or safety
law or regulation by the Borrower or any of its Subsidiaries, which, in
either case, could have a Material Adverse Effect;
(viii) Promptly upon the furnishing thereof to the shareholders of
the Borrower, copies of all financial statements, reports and proxy
statements so furnished;
(ix) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other reports and any other
public information which the Borrower or any of its Subsidiaries files
with the Securities Exchange Commission; and
(x) Such other information (including, without limitation,
financial statements for the Borrower and non-financial information) as
the Administrative Agent or any Lender may from time to time reasonably
request.
6.2 Use of Proceeds. The Borrower will use the proceeds of the Facility
solely to finance the acquisition of the Benderson Projects. The Borrower will
not, nor will it permit any Subsidiary to, use any of the proceeds of the
Advances (i) to purchase or carry any "margin stock" (as defined in Regulation
U) if such usage could constitute a violation of Regulation U by any Lender,
(ii) to fund any purchase of, or offer for, any Capital Stock of any Person,
unless such Person has consented to such offer prior to any public announcements
relating thereto, or (iii) to make any Acquisition other than a Permitted
Acquisition.
6.3 Notice of Default. The Borrower will give, and will cause each of
its Subsidiaries to give, prompt notice in writing to the Administrative Agent
and the Lenders of the occurrence
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of any Default or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material Adverse Effect.
6.4 Conduct of Business. The Borrower will do, and will cause each of
its Subsidiaries to do, all things necessary to remain duly incorporated or duly
qualified, validly existing and in good standing as a real estate investment
trust, corporation, general partnership, limited liability company, or limited
partnership, as the case may be, in its jurisdiction of incorporation/formation
(except with respect to mergers permitted pursuant to Section 6.12 and Permitted
Acquisitions) and maintain all requisite authority to conduct its business in
each jurisdiction in which its business is conducted and to carry on and conduct
their businesses in substantially the same manner as they are presently
conducted where the failure to do so could reasonably be expected to have a
Material Adverse Effect and, specifically, neither the Borrower nor its
Subsidiaries may undertake any business other than the acquisition, development,
ownership, management, operation and leasing of retail, office or industrial
properties, and ancillary businesses specifically related to such types of
properties.
6.5 Taxes. The Borrower will pay, and will cause each of its
Subsidiaries to pay, when due all taxes, assessments and governmental charges
and levies upon them of their income, profits or Projects, except those which
are being contested in good faith by appropriate proceedings and with respect to
which adequate reserves have been set aside.
6.6 Insurance. The Borrower will, and will cause each of its
Subsidiaries to, maintain insurance which is consistent with the representation
contained in Section 5.17 on all their Property and the Borrower will furnish to
any Lender upon reasonable request full information as to the insurance carried.
6.7 Compliance with Laws. The Borrower will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which they may be subject, the
violation of which could reasonably be expected to have a Material Adverse
Effect.
6.8 Maintenance of Properties. The Borrower will, and will cause each of
its Subsidiaries to, do all things necessary to maintain, preserve, protect and
keep their respective Projects and Properties, reasonably necessary for the
continuous operation of the Projects, in good repair, working order and
condition, ordinary wear and tear excepted.
6.9 Inspection. The Borrower will, and will cause each of its
Subsidiaries to, permit the Lenders upon reasonable notice, by their respective
representatives and agents, to inspect any of the Projects, corporate books and
financial records of the Borrower and each of its Subsidiaries, to examine and
make copies of the books of accounts and other financial records of the Borrower
and each of its Subsidiaries, and to discuss the affairs, finances and accounts
of the Borrower and each of its Subsidiaries with officers thereof, and to be
advised as to the same by, their respective officers at such reasonable times
and intervals as the Lenders may designate.
6.10 Maintenance of Status. The Borrower shall at all times (i) remain a
corporation listed and in good standing on the New York Stock Exchange, and (ii)
maintain its status as a real estate investment trust in compliance with all
applicable provisions of the Code relating to such status.
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6.11 Dividends. Provided there is no then-existing Default or (after
notice thereof to Borrower) Unmatured Default hereunder, the Borrower and its
Subsidiaries shall be permitted to declare and pay dividends on their Capital
Stock from time to time in amounts determined by Borrower, provided, however,
that in no event shall Borrower declare or pay dividends on its Capital Stock if
(a) dividends paid on account of any fiscal quarter, in the aggregate, would
exceed 95% of Funds From Operations for such fiscal quarter, or (b) dividends
paid on account of any fiscal year, in the aggregate, would exceed 90% of Funds
From Operations for such fiscal year. Notwithstanding the foregoing, the
Borrower shall be permitted at all times to distribute whatever amount of
dividends is necessary to maintain its tax status as a real estate investment
trust. Notwithstanding the foregoing, the Borrower shall be permitted at all
times to distribute whatever amount of dividends is necessary to maintain its
tax status as a real estate investment trust.
6.12 Merger; Sale of Assets. The Borrower will not, nor will it permit
any of its Subsidiaries to, enter into any merger (other than mergers in which
such entity is the survivor and mergers of Subsidiaries (but not the Borrower)
as part of transactions that are Permitted Acquisitions provided that following
such merger the target entity becomes a Wholly-Owned Subsidiary of Borrower),
consolidation, reorganization or liquidation or transfer or otherwise dispose of
all or a Substantial Portion of their Properties, except for (a) such
transactions that occur between Wholly-Owned Subsidiaries or between Borrower
and a Wholly-Owned Subsidiary, (b) mergers solely to change the jurisdiction of
organization of a Subsidiary Guarantor, and (c) as otherwise approved in advance
by the Required Lenders.
6.13 Delivery of Subsidiary Guaranties. Borrower shall cause each of its
existing Subsidiaries listed on Schedule 6 to execute and deliver to the Agent
the Subsidiary Guaranty. Within 10 days after the later of the date Borrower
forms or acquires any Subsidiary or the date such Subsidiary first owns a
Project (other than a Subsidiary which is a single-purpose entity which owns
only Projects subject to Indebtedness and which has restrictions on the creation
of additional Indebtedness and other safeguards typically imposed on such
single-purpose entities in financings), Borrower shall cause such Subsidiary to
execute and deliver to the Administrative Agent a Subsidiary Guaranty.
6.14 Sale and Leaseback. The Borrower will not, nor will it permit any of
its Subsidiaries to, sell or transfer a Substantial Portion of its Property in
order to concurrently or subsequently lease such Property as lessee.
6.15 Acquisitions and Investments. The Borrower will not, nor will it
permit any Subsidiary to, make or suffer to exist any Investments (including
without limitation, loans and advances to, and other Investments in,
Subsidiaries), or commitments therefor, or become or remain a partner in any
partnership or joint venture, or to make any Acquisition of any Person, except:
(i) Cash Equivalents;
(ii) Investments in existing Subsidiaries, Investments in
Subsidiaries formed for the purpose of developing or acquiring Properties,
Investments in joint ventures and partnerships engaged solely in the
business of purchasing, developing, owning, operating,
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leasing and managing retail properties and office and industrial
properties, and Investments in existence on the date hereof and described
in Schedule 1 hereto;
(iii) transactions permitted pursuant to Section 6.12; and
(iv) Acquisitions of Persons whose primary operations consist of
the ownership, development, operation and management of retail, office or
industrial properties;
provided that, after giving effect to such Acquisitions and Investments,
Borrower continues to comply with all its covenants herein. Acquisitions
permitted pursuant to this Section 6.15 shall be deemed to be "Permitted
Acquisitions".
6.16 Liens. The Borrower will not, nor will it permit any of its
Subsidiaries to, create, incur, or suffer to exist any Lien in, of or on the
Property of the Borrower or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or levies
on its Property if the same shall not at the time be delinquent or
thereafter can be paid without penalty, or are being contested in good
faith and by appropriate proceedings and for which adequate reserves shall
have been set aside on its books;
(ii) Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the ordinary course of
business which secure payment of obligations not more than 60 days past
due or which are being contested in good faith by appropriate proceedings
and for which adequate reserves shall have been set aside on its books;
(iii) Liens arising out of pledges or deposits under workers'
compensation laws, unemployment insurance, old age pensions, or other
social security or retirement benefits, or similar legislation;
(iv) Easements, restrictions and such other encumbrances or charges
against real property as are of a nature generally existing with respect
to properties of a similar character and which do not in any material way
affect the marketability of the same or interfere with the use thereof in
the business of the Borrower or its Subsidiaries;
(v) Liens on Projects existing on the date hereof which secure
Indebtedness as described in Schedule 2 hereto; and
(vi) Liens other than Liens described in subsections (i) through
(iv) above arising in connection with any Indebtedness permitted hereunder
to the extent such Liens will not result in a Default in any of Borrower's
covenants herein.
Liens permitted pursuant to this Section 6.16 shall be deemed to be "Permitted
Liens".
6.17 Affiliates. The Borrower will not, nor will it permit any of its
Subsidiaries to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or
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service) with, or make any payment or transfer to, any Affiliate except in the
ordinary course of business and pursuant to the reasonable requirements of the
Borrower's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to the Borrower or such Subsidiary than the Borrower or such
Subsidiary would obtain in a comparable arms-length transaction.
6.18 Financial Undertakings. The Borrower will not enter into or remain
liable upon, nor will it permit any Subsidiary to enter into or remain liable
upon, any Financial Undertaking, except to the extent required to protect the
Borrower and its Subsidiaries against increases in interest payable by them
under variable interest Indebtedness.
6.19 Variable Interest Indebtedness. The Borrower and its Subsidiaries
shall not at any time permit the outstanding principal balance of Indebtedness
which bears interest at an interest rate that is not fixed through the maturity
date of such Indebtedness to exceed 35% of Consolidated Market Value, unless all
of such Indebtedness in excess of 35% of Consolidated Market Value is subject to
a Rate Management Transaction approved by the Administrative Agent that
effectively converts the interest rate on such excess to a fixed rate.
6.20 Consolidated Net Worth. The Borrower shall maintain a Consolidated
Net Worth of not less than the sum of (i) $1,300,000,000 plus (ii) ninety
percent (90%) of the aggregate proceeds received by the Borrower (net of
customary related fees and expenses) in connection with any offering of stock,
including, without limitation, perpetual preferred stock and all other preferred
stock, in the Borrower after May 29, 2002 and on or prior to the date such
determination of Consolidated Net Worth is made provided that no proceeds shall
be deemed received to the extent that such offering involves only the
replacement or reissuance of common or preferred stock.
6.21 Indebtedness and Cash Flow Covenants. The Borrower on a consolidated
basis with its Subsidiaries shall not permit:
(i) Consolidated Outstanding Indebtedness to exceed sixty percent
(60%) of Consolidated Market Value;
(ii) Consolidated Secured Indebtedness to exceed thirty-five
percent (35%) of Consolidated Market Value, as of the last day of any
fiscal quarter;
(iii) Subordinated Indebtedness to exceed ten percent (10%) of the
Value of Unencumbered Assets, as of any date;
(iv) the Value of Unencumbered Assets to be less than 1.60 times
the Consolidated Senior Unsecured Indebtedness, as of any date;
(v) the aggregate Net Operating Income for the two (2) most recent
fiscal quarters of the Consolidated Group for which results have been
reported under Section 6.1 from all Unencumbered Assets qualifying for
inclusion in the Value of Unencumbered Assets as of the date of
determination to be less than 1.75 times the portion of Consolidated
Interest Expense for such two (2) fiscal quarters attributable to
Consolidated Senior Unsecured Indebtedness, as of the last day of any
fiscal quarter;
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(vi) Consolidated Cash Flow to be less than 2.0 times the
Consolidated Debt Service, based on the most recent two (2) fiscal
quarters, for which the Consolidated Group has reported results under
Section 6.1, annualized, as of the last day of any fiscal quarter; or
(vii) Consolidated Cash Flow to be less than 1.5 times Fixed
Charges, based on the most recent two (2) fiscal quarters, as of the last
day of any fiscal quarter.
6.22 Environmental Matters. Borrower and its Subsidiaries shall:
(a) Comply with, and use all reasonable efforts to ensure
compliance by all tenants and subtenants, if any, with, all
applicable Environmental Laws and obtain and comply with and
maintain, and use all reasonable efforts to ensure that all tenants
and subtenants obtain and comply with and maintain, any and all
licenses, approvals, notifications, registrations or permits
required by applicable Environmental Laws, except to the extent that
failure to do so could not be reasonably expected to have a Material
Adverse Effect; provided that in no event shall the Borrower or its
Subsidiaries be required to modify the terms of leases, or renewals
thereof, with existing tenants (i) at Projects owned by the Borrower
or its Subsidiaries as of the date hereof, or (ii) at Projects
hereafter acquired by the Borrower or its Subsidiaries as of the
date of such acquisition, to add provisions to such effect.
(b) Conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all
material respects with all lawful orders and directives of all
Governmental Authorities regarding Environmental Laws, except to the
extent that (i) the same are being contested in good faith by
appropriate proceedings and the pendency of such proceedings could
not be reasonably expected to have a Material Adverse Effect, or
(ii) the Borrower has determined in good faith that contesting the
same is not in the best interests of the Borrower and its
Subsidiaries and the failure to contest the same could not be
reasonably expected to have a Material Adverse Effect.
(c) Defend, indemnify and hold harmless Administrative Agent
and each Lender, and their respective officers and directors, from
and against any claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature
known or unknown, contingent or otherwise, arising out of, or in any
way relating to the violation of, noncompliance with or liability
under any Environmental Laws applicable to the operations of the
Borrower, its Subsidiaries or the Projects, or any orders,
requirements or demands of Governmental Authorities related thereto,
including, without limitation, attorney's and consultant's fees,
investigation and laboratory fees, response costs, court costs and
litigation expenses, except to the extent that any of the foregoing
arise out of the gross negligence or willful misconduct of the party
seeking indemnification therefor. This indemnity shall continue in
full force and effect regardless of the termination of this
Agreement.
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(d) Prior to the acquisition of a new Project after the
Agreement Execution Date, perform or cause to be performed an
environmental investigation which investigation shall at a minimum
comply with the specifications and procedures attached hereto as
Exhibit G. In connection with any such investigation, Borrower shall
cause to be prepared a report of such investigation, to be made
available to any Lenders upon reasonable request, for informational
purposes and to assure compliance with the specifications and
procedures.
6.23 Permitted Investments.
(a) The Consolidated Group's Investment in Investment
Affiliates, as determined in accordance with GAAP, shall not at any
time exceed thirty percent (30%) of Consolidated Market Value.
(b) The Consolidated Group's Investment in Developable Land
(with each asset valued at the lower of its acquisition cost and its
fair market value) shall not at any time exceed seven and one half
percent (7.5%) of Consolidated Capitalization Value.
(c) The Consolidated Group's Investment in Passive Non-Real
Estate Investments (with each asset valued at the lower of its
acquisition cost and its fair market value) shall not at any time
exceed seven and one half percent (7.5%) of Consolidated
Capitalization Value.
(d) The Consolidated Group's Investment in First Mortgage
Receivables (with each asset valued at the lower of its acquisition
cost and its fair market value) shall not at any time exceed five
percent (5%) of Consolidated Capitalization Value.
(e) The Consolidated Group's Investment in Assets Under
Development shall not at any time exceed fifteen percent (15%) of
Consolidated Capitalization Value.
(f) The Consolidated Group's aggregate Investment in
Developable Land, Passive Non-Real Estate Investments, First
Mortgage Receivables and Assets Under Development shall not at any
time exceed twenty-five (25%) of Consolidated Capitalization Value.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall constitute
a Default:
7.1 Nonpayment of any principal payment on any Note when due.
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7.2 Nonpayment of interest upon any Note or other payment Obligations
under any of the Loan Documents within five (5) Business Days after the same
becomes due.
7.3 The breach of any of the terms or provisions of Sections 6.2 through
6.21 and 6.23.
7.4 Any representation or warranty made or deemed made by or on behalf
of the Borrower or any of its Subsidiaries to the Lenders or the Administrative
Agent under or in connection with this Agreement, any Loan, or any material
certificate or information delivered in connection with this Agreement or any
other Loan Document shall be materially false on the date as of which made.
7.5 The breach by the Borrower (other than a breach which constitutes a
Default under Section 7.1, 7.2, 7.3 or 7.4) of any of the terms or provisions of
this Agreement which is not remedied within fifteen (15) days after written
notice from the Administrative Agent or any Lender.
7.6 Failure of the Borrower or any of its Subsidiaries to pay when due
(A) any Recourse Indebtedness in excess of $10,000,000 in the aggregate or (B)
any Indebtedness, whether or not Recourse Indebtedness, in excess of $40,000,000
in the aggregate; or the default by the Borrower or any of its Subsidiaries in
the performance of any term, provision or condition contained in any agreement,
or any other event shall occur or condition exist, which causes or permits (A)
any Recourse Indebtedness of the Borrower or any of its Subsidiaries in excess
of $10,000,000 in the aggregate or (B) any Indebtedness, whether or not Recourse
Indebtedness, in excess of $40,000,000 in the aggregate to be due and payable or
required to be prepaid (other than by a regularly scheduled payment) prior to
the stated maturity thereof (provided that the failure to pay any such
Indebtedness shall not constitute a Default so long as the Borrower or its
Subsidiaries is diligently contesting the payment of the same by appropriate
legal proceedings and the Borrower or its Subsidiaries have set aside, in a
manner reasonably satisfactory to Administrative Agent, a sufficient reserve to
repay such Indebtedness plus all accrued interest thereon calculated at the
default rate thereunder and costs of enforcement in the event of an adverse
outcome).
7.7 The Borrower, or any Subsidiary having more than $10,000,000 of
Equity Value, shall (i) have an order for relief entered with respect to it
under the Federal bankruptcy laws as now or hereafter in effect, (ii) make an
assignment for the benefit of creditors, (iii) apply for, seek, consent to, or
acquiesce in, the appointment of a receiver, custodian, trustee, examiner,
liquidator or similar official for it or any Substantial Portion of its
Property, (iv) institute any proceeding seeking an order for relief under the
Federal bankruptcy laws as now or hereafter in effect or seeking to adjudicate
it as a bankrupt or insolvent, or seeking dissolution, winding up, liquidation,
reorganization, arrangement, adjustment or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief of
debtors or fail to file an answer or other pleading denying the material
allegations of any such proceeding filed against it, (v) take any corporate
action to authorize or effect any of the foregoing actions set forth in this
Section 7.7, (vi) fail to contest in good faith any appointment or proceeding
described in Section 7.8 or (vii) admit in writing its inability to pay its
debts generally as they become due.
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7.8 A receiver, trustee, examiner, liquidator or similar official shall
be appointed for the Borrower or any Subsidiary having more than $10,000,000 of
Equity Value, or for any Substantial Portion of the Property of the Borrower or
such Subsidiary, or a proceeding described in Section 7.7(iv) shall be
instituted against the Borrower or any such Subsidiary and such appointment
continues undischarged or such proceeding continues undismissed or unstayed for
a period of ninety (90) consecutive days.
7.9 The Borrower or any of its Subsidiaries shall fail within sixty (60)
days to pay, bond or otherwise discharge any judgments or orders for the payment
of money in an amount which, when added to all other judgments or orders
outstanding against Borrower or any Subsidiary would exceed $10,000,000 in the
aggregate, which have not been stayed on appeal or otherwise appropriately
contested in good faith.
7.10 The Borrower or any other member of the Controlled Group shall have
been notified by the sponsor of a Multiemployer Plan that it has incurred
withdrawal liability to such Multiemployer Plan in an amount which, when
aggregated with all other amounts required to be paid to Multiemployer Plans by
the Borrower or any other member of the Controlled Group as withdrawal liability
(determined as of the date of such notification), exceeds $1,000,000 or requires
payments exceeding $500,000 per annum.
7.11 The Borrower or any other member of the Controlled Group shall have
been notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of Title IV
of ERISA, if as a result of such reorganization or termination the aggregate
annual contributions of the Borrower and the other members of the Controlled
Group (taken as a whole) to all Multiemployer Plans which are then in
reorganization or being terminated have been or will be increased over the
amounts contributed to such Multiemployer Plans for the respective plan years of
each such Multiemployer Plan immediately preceding the plan year in which the
reorganization or termination occurs by an amount exceeding $500,000.
7.12 Failure to remediate within the time period permitted by law or
governmental order, after all administrative hearings and appeals have been
concluded (or within a reasonable time in light of the nature of the problem if
no specific time period is so established), environmental problems at Properties
owned by the Borrower or any of its Subsidiaries or Investment Affiliates if the
estimated costs of remediation at all such Properties in the aggregate exceed
$20,000,000.
7.13 The occurrence of any "Default" as defined in any Loan Document or
the breach of any of the terms or provisions of any Loan Document, which default
or breach continues beyond any period of grace therein provided.
7.14 The occurrence of any Material Adverse Effect.
7.15 The occurrence of any "Default" as such term is defined in the
Revolving Credit Agreement.
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ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1 Acceleration. If any Default described in Section 7.7 or 7.8 occurs
with respect to the Borrower, the Obligations shall immediately become due and
payable without any election or action on the part of the Administrative Agent
or any Lender. If any other Default occurs, the Required Lenders may declare the
Obligations to be due and payable, whereupon the Obligations shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which the Borrower hereby expressly waives. If any automatic or
optional acceleration has occurred, the Administrative Agent, as directed by the
Required Lenders (or if no such direction is given within 30 days after a
request for direction, as the Administrative Agent deems in the best interests
of the Lenders, in its sole discretion), shall use its good faith efforts to
collect, including without limitation, by filing and diligently pursuing
judicial action, all amounts owed by the Borrower and any Subsidiary Guarantor
under the Loan Documents.
If, after acceleration of the maturity of the Obligations and before any
judgment or decree for the payment of the Obligations due shall have been
obtained or entered, all of the Lenders (in their sole discretion) shall so
direct, the Administrative Agent shall, by notice to the Borrower, rescind and
annul such acceleration and/or termination.
8.2 Amendments. Subject to the provisions of this Article VIII, the
Required Lenders (or the Administrative Agent with the consent in writing of the
Required Lenders) and the Borrower may enter into agreements supplemental hereto
for the purpose of adding or modifying any provisions to the Loan Documents or
changing in any manner the rights of the Lenders or the Borrower hereunder or
waiving any Default hereunder; provided, however, that no such supplemental
agreement or waiver shall, without the consent of all Lenders:
(i) Extend the Facility Termination Date, subject to the
provisions of Section 2.22, or forgive all or any portion of the principal
amount of any Loan or accrued interest thereon, reduce the Applicable
Margins (or modify any definition herein which would have the effect of
reducing the Applicable Margins) or the underlying interest rate options
or extend the time of payment of any such principal, interest or fees.
(ii) Release any Subsidiary Guarantor (other than a Subsidiary
Guarantor that has liquidated all of its assets and applied all of the
proceeds of such liquidation in accordance with its organizational
documents) from the Subsidiary Guaranty or any other future guarantor
(other than a Subsidiary Guarantor that has liquidated all of its assets
and applied all of the proceeds of such liquidation in accordance with its
organizational documents) from any liability it may undertake with respect
to the Obligations.
(iii) Reduce the percentage specified in the definition of Required
Lenders.
(iv) Increase the Aggregate Commitment beyond $200,000,000.
(v) Permit the Borrower to assign its rights under this Agreement.
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(vi) Amend Sections 2.3, 2.13(ii), 2.20, 8.1, 8.2, 11.2 or the
definition of Required Lenders.
No amendment of any provision of this Agreement relating to the Administrative
Agent shall be effective without the written consent of the Administrative
Agent.
8.3 Preservation of Rights. No delay or omission of the Lenders or the
Administrative Agent to exercise any right under the Loan Documents shall impair
such right or be construed to be a waiver of any Default or an acquiescence
therein, and the making of a Loan notwithstanding the existence of a Default or
the inability of the Borrower to satisfy the conditions precedent to such Loan
shall not constitute any waiver or acquiescence. Any single or partial exercise
of any such right shall not preclude other or further exercise thereof or the
exercise of any other right, and no waiver, amendment or other variation of the
terms, conditions or provisions of the Loan Documents whatsoever shall be valid
unless in writing signed by the Lenders required pursuant to Section 8.2, and
then only to the extent in such writing specifically set forth. All remedies
contained in the Loan Documents or by law afforded shall be cumulative and all
shall be available to the Administrative Agent and the Lenders until the
Obligations have been paid in full.
ARTICLE IX
GENERAL PROVISIONS
9.1 Survival of Representations. All representations and warranties of
the Borrower contained in this Agreement shall survive delivery of the Notes and
the making of the Loans herein contemplated.
9.2 Governmental Regulation. Anything contained in this Agreement to the
contrary notwithstanding, no Lender shall be obligated to extend credit to the
Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3 Taxes. Any taxes (excluding taxes on the overall net income of any
Lender) or other similar assessments or charges made by any governmental or
revenue authority in respect of the Loan Documents shall be paid by the
Borrower, together with interest and penalties, if any.
9.4 Headings. Section headings in the Loan Documents are for convenience
of reference only, and shall not govern the interpretation of any of the
provisions of the Loan Documents.
9.5 Entire Agreement. The Loan Documents embody the entire agreement and
understanding among the Borrower, the Administrative Agent and the Lenders and
supersede all prior commitments, agreements and understandings among the
Borrower, the Administrative Agent and the Lenders relating to the subject
matter thereof.
9.6 Several Obligations; Benefits of this Agreement. The respective
obligations of the Lenders hereunder are several and not joint and no Lender
shall be the partner or agent of any
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other (except to the extent to which the Administrative Agent is authorized to
act as such). The failure of any Lender to perform any of its obligations
hereunder shall not relieve any other Lender from any of its obligations
hereunder. This Agreement shall not be construed so as to confer any right or
benefit upon any Person other than the parties to this Agreement and their
respective successors and assigns.
9.7 Expenses; Indemnification. The Borrower shall reimburse the
Administrative Agent for any costs, internal charges and out-of-pocket expenses
(including, without limitation, all reasonable fees for consultants and fees and
reasonable expenses for attorneys for the Administrative Agent, which attorneys
may be employees of the Administrative Agent) paid or incurred by the
Administrative Agent in connection with the amendment, modification, and
enforcement of the Loan Documents. The Borrower also agrees to reimburse the
Administrative Agent and the Lenders for any reasonable costs, internal charges
and out-of-pocket expenses (including, without limitation, all fees and
reasonable expenses for attorneys for the Administrative Agent and the Lenders,
which attorneys may be employees of the Administrative Agent or the Lenders)
paid or incurred by the Administrative Agent or any Lender in connection with
the collection and enforcement of the Loan Documents (including, without
limitation, any workout). The Borrower further agrees to indemnify the
Administrative Agent, the Syndication Agent, the Documentation Agent, each
Lender and their Affiliates, and their directors and officers against all
losses, claims, damages, penalties, judgments, liabilities and expenses
(including, without limitation, all fees and reasonable expenses for attorneys
of the indemnified parties, all expenses of litigation or preparation therefor
whether or not the Administrative Agent, the Syndication Agent, the
Documentation Agent or any Lender is a party thereto) which any of them may pay
or incur arising out of or relating to this Agreement, the other Loan Documents,
the Projects, the transactions contemplated hereby or the direct or indirect
application or proposed application of the proceeds of any Loan hereunder,
except to the extent that any of the foregoing arise out of the gross negligence
or willful misconduct of the party seeking indemnification therefor. The
obligations of the Borrower under this Section shall survive the termination of
this Agreement.
9.8 Numbers of Documents. All statements, notices, closing documents,
and requests hereunder shall be furnished to the Administrative Agent with
sufficient counterparts so that the Administrative Agent may furnish one to each
of the Lenders.
9.9 Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP.
9.10 Severability of Provisions. Any provision in any Loan Document that
is held to be inoperative, unenforceable, or invalid in any jurisdiction shall,
as to that jurisdiction, be inoperative, unenforceable, or invalid without
affecting the remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other jurisdiction, and to
this end the provisions of all Loan Documents are declared to be severable.
9.11 Nonliability of Lenders. The relationship between the Borrower, on
the one hand, and the Lenders and the Administrative Agent, on the other, shall
be solely that of borrower and lender. Neither the Administrative Agent nor any
Lender shall have any fiduciary
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responsibilities to the Borrower. Neither the Administrative Agent nor any
Lender undertakes any responsibility to the Borrower to review or inform the
Borrower of any matter in connection with any phase of the Borrower's business
or operations.
9.12 CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE CONTAINING A
CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN ACCORDANCE WITH
THE INTERNAL LAWS (AND NOT THE LAW OF CONFLICTS) OF THE STATE OF ILLINOIS, BUT
GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.
9.13 CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY SUBMITS TO
THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR ILLINOIS STATE
COURT SITTING IN CHICAGO IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS
IN RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE
ADMINISTRATIVE AGENT OR ANY LENDER TO BRING PROCEEDINGS AGAINST THE BORROWER IN
THE COURTS OF ANY OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER
AGAINST THE ADMINISTRATIVE AGENT OR ANY LENDER OR ANY AFFILIATE OF THE
ADMINISTRATIVE AGENT OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT SHALL
BE BROUGHT ONLY IN A COURT IN CHICAGO, ILLINOIS.
9.14 WAIVER OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT AND
EACH LENDER HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING,
DIRECTLY OR INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR
OTHERWISE) IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN
DOCUMENT OR THE RELATIONSHIP ESTABLISHED THEREUNDER.
ARTICLE X
THE ADMINISTRATIVE AGENT
10.1 Appointment; Nature of Relationship. Bank One, NA is hereby
appointed by each of the Lenders as its contractual representative (herein
referred to as the "Administrative Agent") hereunder and under each other Loan
Document, and each of the Lenders irrevocably authorizes the Administrative
Agent to act as the contractual representative of such Lender with the rights
and duties expressly set forth herein and in the other Loan Documents. The
Administrative Agent agrees to act as such contractual representative upon the
express conditions contained in this Article X. Notwithstanding the use of the
defined term
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"Administrative Agent," it is expressly understood and agreed that the
Administrative Agent shall not have any fiduciary responsibilities to any Lender
by reason of this Agreement or any other Loan Document and that the
Administrative Agent is merely acting as the contractual representative of the
Lenders with only those duties as are expressly set forth in this Agreement and
the other Loan Documents. In its capacity as the Lenders' contractual
representative, the Administrative Agent (i) does not hereby assume any
fiduciary duties to any of the Lenders, (ii) is a "representative" of the
Lenders within the meaning of the term "secured party" as defined in the
Illinois Uniform Commercial Code and (iii) is acting as an independent
contractor, the rights and duties of which are limited to those expressly set
forth in this Agreement and the other Loan Documents. Each of the Lenders hereby
agrees to assert no claim against the Administrative Agent on any agency theory
or any other theory of liability for breach of fiduciary duty, all of which
claims each Lender hereby waives.
10.2 Powers. The Administrative Agent shall have and may exercise such
powers under the Loan Documents as are specifically delegated to the
Administrative Agent by the terms of each thereof, together with such powers as
are reasonably incidental thereto. The Administrative Agent shall have no
implied duties to the Lenders, or any obligation to the Lenders to take any
action thereunder except any action specifically provided by the Loan Documents
to be taken by the Administrative Agent. The Administrative Agent shall
administer this Agreement in the same manner and with the same standard of care
as it administers similar agreements for its own account.
10.3 General Immunity. Neither the Administrative Agent nor any of its
directors, officers, agents or employees shall be liable to the Borrower, the
Lenders or any Lender for (i) any action taken or omitted to be taken by it or
them hereunder or under any other Loan Document or in connection herewith or
therewith except for its or their own gross negligence or willful misconduct; or
(ii) any determination by the Administrative Agent that compliance with any law
or any governmental or quasi-governmental rule, regulation, order, policy,
guideline or directive (whether or not having the force of law) requires the
Advances hereunder to be classified as being part of a "highly leveraged
transaction". The foregoing shall not limit the liability of the Administrative
Agent for a breach of its express obligations and undertakings to the Lenders
hereunder which continues after written notice to the Administrative Agent of
such breach and its failure to cure such breach within a reasonable time after
such notice.
10.4 No Responsibility for Loans, Recitals, etc. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be responsible for or have any duty to ascertain, inquire into, or verify
(i) any statement, warranty or representation made in connection with any Loan
Document or any borrowing hereunder; (ii) the performance or observance of any
of the covenants or agreements of any obligor under any Loan Document,
including, without limitation, any agreement by an obligor to furnish
information directly to each Lender; (iii) the satisfaction of any condition
specified in Article IV, except receipt of items required to be delivered to the
Administrative Agent; or (iv) the validity, effectiveness or genuineness of any
Loan Document or any other instrument or writing furnished in connection
therewith. Except as otherwise specifically provided herein, the Administrative
Agent shall have no duty to disclose to the Lenders information that is not
required to be furnished by the Borrower to the Administrative Agent at such
time, but is voluntarily furnished by the Borrower to the
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Administrative Agent (either in its capacity as Administrative Agent or in its
individual capacity). Notwithstanding anything to the contrary herein,
Administrative Agent shall make available promptly after the Agreement Execution
Date to any Lender copies of all Loan Documents in its possession which are
requested by any such Lender. Administrative Agent shall also furnish to all
Lenders promptly after such items are available in final form copies of Default
notices issued to the Borrower, amendments to any Loan Documents being proposed
by the Administrative Agent or the Borrower, financial statements of the
Borrower required hereunder, compliance certificates from the Borrower required
by this Agreement or any other notice or communication from the Borrower
specifically relating to this Agreement which is actually received by the
Administrative Agent. Promptly after the Administrative Agent has actual
knowledge of the occurrence of a Default hereunder, the Administrative Agent
shall so notify the Lenders.
10.5 Action on Instructions of Lenders. Notwithstanding anything herein
to the contrary, the Administrative Agent shall in all cases be fully protected
in so acting, or refraining from acting, hereunder and under any other Loan
Document in accordance with written instructions signed by the Required Lenders
or all of the Lenders, as the case may be, and such instructions and any action
taken or failure to act pursuant to such written instructions shall be binding
on all of the Lenders and on all holders of Notes and on the Administrative
Agent.
10.6 Employment of Agents and Counsel. The Administrative Agent may
execute any of its duties as Administrative Agent hereunder and under any other
Loan Document by or through employees, agents, and attorneys-in-fact and shall
not be answerable to the Lenders, except as to money or securities received by
it or its authorized agents, for the default or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. The Administrative Agent
shall be entitled to advice of counsel concerning all matters pertaining to the
agency hereby created and its duties hereunder and under any other Loan
Document.
10.7 Reliance on Documents; Counsel. The Administrative Agent shall be
entitled to rely upon any Note, notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in respect
to legal matters, upon the opinion of counsel selected by the Administrative
Agent, which counsel may be employees of the Administrative Agent.
10.8 Administrative Agent's Reimbursement and Indemnification. The
Lenders agree to reimburse and indemnify the Administrative Agent ratably in
proportion to their respective Percentage (i) for any amounts not reimbursed by
the Borrower for which the Administrative Agent is entitled to reimbursement by
the Borrower under the Loan Documents, (ii) for any other expenses incurred by
the Administrative Agent on behalf of the Lenders, in connection with the
preparation, execution, delivery, administration and enforcement of the Loan
Documents, if not paid by Borrower and (iii) for any liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Administrative Agent in any way relating to
or arising out of the Loan Documents or any other document delivered in
connection therewith or the transactions contemplated thereby, or the
enforcement of any of the terms thereof or of any such other documents, provided
that no Lender shall be liable for any of the foregoing to the extent they arise
from the gross negligence or willful misconduct or a breach of the
-53-
Administrative Agent's express obligations and undertakings to the Lenders which
is not cured after written notice and within the period described in Section
10.3. To the extent any amounts so paid by Lenders are thereafter recovered by
the Administrative Agent from the Borrower or any Subsidiary Guarantor or
otherwise, such recovered amount shall be remitted to the Lenders making such
payment on a pro rata basis in accordance with their respective portions of such
payment. The obligations of the Lenders and the Administrative Agent under this
Section 10.8 shall survive payment of the Obligations and termination of this
Agreement.
10.9 Rights as a Lender. In the event the Administrative Agent is a
Lender, the Administrative Agent shall have the same rights and powers hereunder
and under any other Loan Document as any Lender and may exercise the same as
though it were not the Administrative Agent, and the term "Lender" or "Lenders"
shall, at any time when the Administrative Agent is a Lender, unless the context
otherwise indicates, include the Administrative Agent in its individual
capacity. The Administrative Agent may accept deposits from, lend money to, and
generally engage in any kind of trust, debt, equity or other transaction, in
addition to those contemplated by this Agreement or any other Loan Document,
with the Borrower or any of its Subsidiaries in which the Borrower or such
Subsidiary is not restricted hereby from engaging with any other Person. The
Administrative Agent, in its individual capacity, is not obligated to remain a
Lender but if the Administrative Agent is no longer a Lender, the Administrative
Agent shall resign and a successor shall be appointed as described in Section
10.11. The rights and duties of the Administrative Agent are separate from its
rights and duties as a Lender and no transfer of all or any part of the
Administrative Agent's Percentage as a Lender in the Loans hereunder shall be
deemed to transfer any of its rights and duties as Administrative Agent to its
successor or successors as a Lender.
10.10 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on the financial statements prepared by the Borrower and such
other documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement and the other Loan Documents.
10.11 Successor Administrative Agent. Except as otherwise provided below,
Bank One shall serve as Administrative Agent at all times during the term of
this Facility. Bank One may resign as Administrative Agent in the event (x) Bank
One and Borrower shall mutually agree in writing or (y) an Event of Default
shall occur and be continuing under the Loan Documents, or (z) Bank One shall
determine, in its sole reasonable discretion, that because of its other banking
relationships with Borrower and/or Borrower's Affiliates at the time of such
decision Bank One's resignation as Administrative Agent would be necessary in
order to avoid creating an appearance of impropriety on the part of Bank One.
Bank One shall also resign as Administrative Agent, within 30 days after receipt
of a written request from the Required Lenders, if the Administrative Agent's
Commitment, after giving effect to any assignments or reductions hereunder, is
less than 5% of the then-current Aggregate Commitment. Bank One (or any
successor Administrative Agent) may be removed as Administrative Agent by
written notice
-54-
received by Administrative Agent from the Required Lenders (excluding the then
existing Administrative Agent) at any time with cause (i.e., a breach by Bank
One (or any successor Administrative Agent) of its duties as Administrative
Agent hereunder) or for gross negligence or willful misconduct. Upon any such
resignation, the Required Lenders shall have the right to appoint, on behalf of
the Borrower and the Lenders, a successor Administrative Agent. If no successor
Administrative Agent shall have been so appointed by the Required Lenders within
thirty days after the resigning Administrative Agent's giving notice of its
intention to resign or receiving such a request to resign, then the resigning
Administrative Agent shall, prior to the effective date of its resignation,
appoint, on behalf of the Borrower and the Lenders, a successor Administrative
Agent. No successor Administrative Agent shall be deemed to be appointed
hereunder until such successor Administrative Agent has accepted the
appointment. Any such successor Administrative Agent shall be a commercial bank
having capital and retained earnings of at least $500,000,000. Upon the
acceptance of any appointment as Administrative Agent hereunder by a successor
Administrative Agent, such successor Administrative Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the resigning Administrative Agent. Upon the effectiveness of the resignation
of the Administrative Agent, the resigning Administrative Agent shall be
discharged from its duties and obligations hereunder and under the Loan
Documents. After the effectiveness of the resignation of an Administrative
Agent, the provisions of this Article XI shall continue in effect for the
benefit of such Administrative Agent in respect of any actions taken or omitted
to be taken by it while it was acting as the Administrative Agent hereunder and
under the other Loan Documents.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1 Setoff. In addition to, and without limitation of, any rights of the
Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any of its Affiliates to or for the credit or account of the Borrower may be
offset and applied toward the payment of the Obligations owing to such Lender at
any time prior to the date that such Default has been fully cured, whether or
not the Obligations, or any part hereof, shall then be due.
11.2 Ratable Payments. If any Lender, whether by setoff or otherwise, has
payment made to it upon its Loans (other than payments received pursuant to
Sections 3.1, 3.2 or 3.4) in a greater proportion than that received by any
other Lender, such Lender agrees, promptly upon demand, to purchase a portion of
the Loans held by the other Lenders so that after such purchase each Lender will
hold its ratable proportion of Loans. If any Lender, whether in connection with
setoff or amounts which might be subject to setoff or otherwise, receives
collateral or other protection for its Obligations or such amounts which may be
subject to setoff, such Lender agrees, promptly upon demand, to take such action
necessary such that all Lenders share in the benefits of such collateral ratably
in proportion to their Loans. In case any such payment is disturbed by legal
process, or otherwise, appropriate further adjustments shall be made.
-55-
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1 Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. Notwithstanding clause (ii) of this Section, any Lender may
at any time, without the consent of the Borrower or the Administrative Agent,
assign all or any portion of its rights under this Agreement and its Notes to a
Federal Reserve Bank; provided, however, that no such assignment shall release
the transferor Lender from its obligations hereunder. The Administrative Agent
may treat the payee of any Note as the owner thereof for all purposes hereof
unless and until such payee complies with Section 12.3 in the case of an
assignment thereof or, in the case of any other transfer, a written notice of
the transfer is filed with the Administrative Agent. Any assignee or transferee
of a Note agrees by acceptance thereof to be bound by all the terms and
provisions of the Loan Documents. Any request, authority or consent of any
Person, who at the time of making such request or giving such authority or
consent is the holder of any Note, shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note or Notes
issued in exchange therefor.
12.2 Participations.
12.2.1 Permitted Participants; Effect. Any Lender may, in the
ordinary course of its business and in accordance with applicable law, at any
time sell to one or more banks, financial institutions, pension funds, or any
other funds or entities ("Participants") participating interests in any Loan
owing to such Lender, any Note held by such Lender, or any other interest of
such Lender under the Loan Documents. In the event of any such sale by a Lender
of participating interests to a Participant, such Lender's obligations under the
Loan Documents shall remain unchanged, such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
such Lender shall remain the holder of any such Note for all purposes under the
Loan Documents, all amounts payable by the Borrower under this Agreement shall
be determined as if such Lender had not sold such participating interests, and
the Borrower and the Administrative Agent shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under the Loan Documents.
12.2.2 Voting Rights. Each Lender shall retain the sole right to
approve, without the consent of any Participant, any amendment, modification or
waiver of any provision of the Loan Documents other than any amendment,
modification or waiver with respect to any Loan in which such Participant has an
interest which forgives principal, interest or fees or reduces the interest rate
or fees payable with respect to any such Loan or postpones any date fixed for
any regularly-scheduled payment of principal of, or interest or fees on, any
such Loan or releases any Subsidiary from the Subsidiary Guaranty.
-56-
12.2.3 Benefit of Setoff. The Borrower agrees that each Participant
which has previously advised the Borrower in writing of its purchase of a
participation in a Lender's interest in its Loans shall be deemed to have the
right of setoff provided in Section 11.1 in respect of its participating
interest in amounts owing under the Loan Documents to the same extent as if the
amount of its participating interest were owing directly to it as a Lender under
the Loan Documents. Each Lender shall retain the right of setoff provided in
Section 11.1 with respect to the amount of participating interests sold to each
Participant, provided that such Lender and Participant may not each setoff
amounts against the same portion of the Obligations, so as to collect the same
amount from the Borrower twice. The Lenders agree to share with each
Participant, and each Participant, by exercising the right of setoff provided in
Section 11.1, agrees to share with each Lender, any amount received pursuant to
the exercise of its right of setoff, such amounts to be shared in accordance
with Section 11.2 as if each Participant were a Lender.
12.3 Assignments.
12.3.1 Permitted Assignments. Any Lender may, in the ordinary course
of its business and in accordance with applicable law, at any time assign to any
of such Lender's affiliates or to one or more banks, financial institutions or
pension funds, or with the prior approval of the Borrower, which shall not be
unreasonably withheld or delayed, any other entity ("Purchasers") all or any
portion of its rights and obligations under the Loan Documents. Notwithstanding
the foregoing, no approval of the Borrower shall be required for any such
assignment if a Default has occurred and is then continuing. Such assignment
shall be substantially in the form of Exhibit D hereto or in such other form as
may be agreed to by the parties thereto. The consent of the Administrative Agent
shall be required prior to an assignment becoming effective with respect to a
Purchaser which is not a Lender or an Affiliate thereof. Such consent shall not
be unreasonably withheld.
12.3.2 Effect; Effective Date. Upon (i) delivery to the
Administrative Agent of a notice of assignment, substantially in the form
attached as Exhibit "I" to Exhibit D hereto (a "Notice of Assignment"), together
with any consents required by Section 12.3.1, and (ii) payment of a $3,500 fee
by the assignor or assignee to the Administrative Agent for processing such
assignment, such assignment shall become effective on the effective date
specified in such Notice of Assignment. The Notice of Assignment shall contain a
representation by the Purchaser to the effect that none of the consideration
used to make the purchase of the Loans under the applicable assignment agreement
are "plan assets" as defined under ERISA and that the rights and interests of
the Purchaser in and under the Loan Documents will not be "plan assets" under
ERISA. On and after the effective date of such assignment, such Purchaser shall
for all purposes be a Lender party to this Agreement and any other Loan Document
executed by the Lenders and shall have all the rights and obligations of a
Lender under the Loan Documents, to the same extent as if it were an original
party hereto, and no further consent or action by the Borrower, the Lenders or
the Administrative Agent shall be required to release the transferor Lender, and
the transferor Lender shall automatically be released on the effective date of
such assignment, with respect to the percentage of the Loans assigned to such
Purchaser. Upon the consummation of any assignment to a Purchaser pursuant to
this Section 12.3.2, the transferor Lender, the Administrative Agent and the
Borrower shall make appropriate arrangements so that replacement
-57-
Notes are issued to such transferor Lender and new Notes or, as appropriate,
replacement Notes, are issued to such Purchaser.
12.4 Dissemination of Information. The Borrower authorizes each Lender to
disclose to any Participant or Purchaser or any other Person acquiring an
interest in the Loan Documents by operation of law (each a "Transferee") and any
prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries, subject to
Section 12.6.
12.5 Tax Treatment. If any interest in any Loan Document is transferred
to any Transferee which is organized under the laws of any jurisdiction other
than the United States or any State thereof, the transferor Lender shall cause
such Transferee, concurrently with the effectiveness of such transfer, to comply
with the provisions of Section 3.5.
12.6 Confidentiality. The Administrative Agent and Lenders agree to take
normal and reasonable precautions and exercise due care to maintain the
confidentiality of all non-public information provided to them by the Borrower
or by any other Person on the Borrower's behalf in connection with the Loan
Documents and agree and undertake that neither they nor any of their Affiliates
shall disclose any such information for any purpose or in any manner other than
pursuant to the terms contemplated by the Loan Documents. The Administrative
Agent and each Lender may disclose such information (1) at the request of any
regulatory authority with jurisdiction over the Administrative Agent and/or the
Lenders or in connection with an examination of such Person by any such
authority, (2) pursuant to subpoena or other process of a court having
jurisdiction over the Administrative Agent and/or the Lenders, (3) when required
to do so in accordance with the provisions of any applicable law, (4) at the
express direction of any other governmental authority, with jurisdiction over
the Administrative Agent and/or the Lenders, of any State of the United States
of America or of any other jurisdiction in which such Person conducts its
business, (5) to such Person's independent auditors, attorneys and other
professional advisors, (6) if such information has become public other than
through disclosure by such Person or any Lender, (7) in connection with any
litigation involving such Person, and (8) to any Affiliate of such Person which
agrees to be bound by this Section 12.6. Notwithstanding the foregoing, the
Borrower authorizes each of the Administrative Agent and each Lender to disclose
to any prospective or actual Transferee such financial and other information in
its possession (i) which has been delivered to such Person pursuant to the Loan
Documents or which has been delivered to such Person by the Borrower prior to
entering into the Loan Documents, or (ii) which is reasonably necessary to
effectuate the purposes of this Agreement and the Loan Documents; provided that,
unless otherwise agreed by the Borrower, such Transferee shall agree to keep
such information confidential to the same extent required to the Administrative
Agent or any Lender, as applicable, hereunder.
-58-
ARTICLE XIII
NOTICES
13.1 Giving Notice. Except as otherwise permitted by Section 2.14 with
respect to borrowing notices, all notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing or by telex or by facsimile and addressed or delivered to such party at
its address set forth below its signature hereto or at such other address (or to
counsel for such party) as may be designated by such party in a notice to the
other parties. Any notice, if mailed and properly addressed with postage
prepaid, shall be deemed given when received; any notice, if transmitted by
telex or facsimile, shall be deemed given when transmitted (answerback confirmed
in the case of telexes).
13.2 Change of Address. The Borrower, the Administrative Agent and any
Lender may each change the address for service of notice upon it by a notice in
writing to the other parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart. This Agreement shall be
effective when it has been executed by the Borrower, the Administrative Agent
and the Lenders and each party has notified the Administrative Agent by telex or
telephone, that it has taken such action.
(Remainder of page intentionally left blank.)
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IN WITNESS WHEREOF, the Borrower, the Lenders and the Administrative Agent
have executed this Agreement as of the date first above written.
DEVELOPERS DIVERSIFIED REALTY CORPORATION
By:______________________________________
Print Name:______________________________
Title:___________________________________
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Phone: 216/▇▇▇-▇▇▇▇
Facsimile: 216/755-1506
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
S-1
COMMITMENTS: BANK ONE, NA,
$32,500,000 Individually and as Administrative Agent
By:______________________________________
Print Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title:___________________________________
1 Bank One Plaza, IL 1-0315
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Phone: 312/▇▇▇-▇▇▇▇
Facsimile: 312/325-3122
Attention: Large Corporate Real Estate
S-2
$50,000,000 ▇▇▇▇▇ FARGO BANK, N.A.,
Real Estate Finance Group,
Individually and as Syndication Agent
By:______________________________________
Print Name:______________________________
Title:___________________________________
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: 312/▇▇▇-▇▇▇▇
Facsimile: 312/782-0969
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇
S-3
$32,500,000 WACHOVIA BANK, NA,
Individually and as Documentation Agent
By:______________________________________
Print Name:______________________________
Title:___________________________________
Mail Code GA-8057, 28th Floor
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇., ▇.▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: 404/▇▇▇-▇▇▇▇
Facsimile: 404/332-4066
Attention: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇
S-4
$20,000,000 EUROHYPO AG, NEW YORK BRANCH,
By:______________________________________
Print Name:______________________________
Title:___________________________________
By:______________________________________
Print Name:______________________________
Title:___________________________________
Eurohypo AG, New York Branch
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
S-5
$20,000,000 SUNTRUST BANK
By:______________________________________
Print Name:______________________________
Title:___________________________________
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: 703/▇▇▇-▇▇▇▇
Facsimile: 703/902-9190
Attention: Ms. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
S-6
$15,000,000 ALLIED IRISH BANKS, P.L.C.
New York Branch
By:______________________________________
Print Name:______________________________
Title:___________________________________
By:______________________________________
Print Name:______________________________
Title:___________________________________
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: 212/▇▇▇-▇▇▇▇
Facsimile: 212/339-8325
Attention: ▇▇. ▇▇▇▇▇▇▇ ▇'▇▇▇▇▇▇
▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
S-7
$15,000,000 LASALLE BANK, N.A.
By:______________________________________
Print Name:______________________________
Title:___________________________________
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: 312/▇▇▇-▇▇▇▇
Facsimile: 312/904-6691
Attention: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇-▇
$15,000,000 PNC BANK, NATIONAL ASSOCIATION
By:______________________________________
Print Name:______________________________
Title:___________________________________
One PNC Plaza
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇▇▇▇-▇▇-▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: 412/▇▇▇-▇▇▇▇
Facsimile: 412/762-6500
Attention: Mr. ▇▇▇▇▇▇▇ ▇▇▇▇▇
S-9
EXHIBIT A
NOTE
May ___, 2004
Developers Diversified Realty Corporation, a corporation organized under
the laws of the State of Ohio (the "Borrower"), promises to pay to the order of
_________________________ (the "Lender") the aggregate unpaid principal amount
of the Loan made by the Lender to the Borrower pursuant to Article II of the
Term Loan Credit Agreement (as the same may be amended or modified, the
"Agreement") hereinafter referred to, in immediately available funds at the main
office of Bank One, NA in Chicago, Illinois, as Agent, together with interest on
the unpaid principal amount hereof at the rates and on the dates set forth in
the Agreement. The Borrower shall pay remaining unpaid principal of and accrued
and unpaid interest on the Loans in full on the Facility Termination Date or
such earlier date as may be required under the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Loan and the date and amount of each principal
payment hereunder.
This Note is one of the Notes issued pursuant to, and is entitled to the
benefits of, the Term Loan Credit Agreement, dated as of May ___, 2004 among the
Borrower, Bank One, NA, individually and as Administrative Agent, and the other
Lenders named therein, to which Agreement, as it may be amended from time to
time, reference is hereby made for a statement of the terms and conditions
governing this Note, including the terms and conditions under which this Note
may be prepaid or its maturity date accelerated. Capitalized terms used herein
and not otherwise defined herein are used with the meanings attributed to them
in the Agreement.
If there is a Default under the Agreement or any other Loan Document and
Agent exercises the remedies provided under the Agreement and/or any of the Loan
Documents for the Lenders, then in addition to all amounts recoverable by the
Agent and the Lenders under such documents, Agent and the Lenders shall be
entitled to receive reasonable attorneys fees and expenses incurred by Agent and
the Lenders in connection with the exercise of such remedies.
Borrower and all endorsers severally waive presentment, protest and
demand, notice of protest, demand and of dishonor and nonpayment of this Note,
and any and all lack of diligence or delays in collection or enforcement of this
Note, and expressly agree that this Note, or any payment hereunder, may be
extended from time to time, and expressly consent to the release of any party
liable for the obligation secured by this Note, the release of any of the
security for this Note, the acceptance of any other security therefor, or any
other indulgence or forbearance whatsoever, all without notice to any party and
without affecting the liability of the Borrower and any endorsers hereof.
A-1
This Note shall be governed and construed under the internal laws of the
State of Illinois.
BORROWER AND LENDER, BY ITS ACCEPTANCE HEREOF, EACH HEREBY WAIVE ANY RIGHT
TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHT
UNDER THIS NOTE OR ANY OTHER LOAN DOCUMENT OR RELATING THERETO OR ARISING FROM
THE LENDING RELATIONSHIP WHICH IS THE SUBJECT OF THIS NOTE AND AGREE THAT ANY
SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A JUDGE AND NOT BEFORE A JURY.
DEVELOPERS DIVERSIFIED REALTY
CORPORATION, an Ohio corporation
By:___________________________________
Print Name:___________________________
Title:________________________________
A-2
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
NOTE OF DEVELOPERS DIVERSIFIED REALTY CORPORATION,
DATED ____________, 2004
Maturity
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
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A-3
EXHIBIT B
FORM OF OPINION
B-1
EXHIBIT C
COMPLIANCE CERTIFICATE
C-1
EXHIBIT D
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption (the "Assignment and Assumption") is dated
as of the Effective Date set forth below and is entered into by and between
[Insert name of Assignor] (the "Assignor") and [Insert name of Assignee] (the
"Assignee"). Capitalized terms used but not defined herein shall have the
meanings given to them in the Credit Agreement identified below (as amended, the
"Credit Agreement"), receipt of a copy of which is hereby acknowledged by the
Assignee. The Terms and Conditions set forth in Annex 1 attached hereto are
hereby agreed to and incorporated herein by reference and made a part of this
Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and
assigns to the Assignee, and the Assignee hereby irrevocably purchases and
assumes from the Assignor, subject to and in accordance with the Terms and
Conditions and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below, the interest in and to all of the
Assignor's rights and obligations in its capacity as a Lender under the Credit
Agreement and any other documents or instruments delivered pursuant thereto that
represents the amount and percentage interest identified below of all of the
Assignor's outstanding rights and obligations under the respective facilities
identified below (including without limitation any letters of credit, guaranties
and swingline loans included in such facilities and, to the extent permitted to
be assigned under applicable law, all claims (including without limitation
contract claims, tort claims, malpractice claims, statutory claims and all other
claims at law or in equity), suits, causes of action and any other right of the
Assignor against any Person whether known or unknown arising under or in
connection with the Credit Agreement, any other documents or instruments
delivered pursuant thereto or the loan transactions governed thereby) (the
"Assigned Interest"). Such sale and assignment is without recourse to the
Assignor and, except as expressly provided in this Assignment and Assumption,
without representation or warranty by the Assignor.
1. Assignor:
2. Assignee: _________________________________ [and is an Affiliate/Approved
Fund of [identify Lender](1)
3. Borrower(s):
4. Administrative Agent: ____________________________________ , as the agent
under the Credit Agreement.
5. Credit Agreement: The [amount] Credit Agreement dated as of
_______________ among
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[name of Borrower(s)], the Lenders party
thereto, [name of Administrative Agent], as
Agent, and the other agents party thereto.
(1) Select as applicable.
6. Assigned Interest:
Aggregate Amount of
Commitment/Loans for all Amount of Commitment/Loans Percentage Assigned of
Facility Assigned Lenders* Assigned* Commitment/Loans(2)
----------------- ------------------------ --------------------------- ----------------------
(3) $ $ %
------------ --------
------------ $ $ -------%
------------ $ $ -------%
7. Trade Date:__________________________________________________(4)
Effective Date: ____________________, 20__ [TO BE INSERTED BY AGENT AND WHICH
SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER BY THE AGENT.]
The terms set forth in this Assignment and Assumption are hereby agreed
to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:____________________________
Title:_________________________
ASSIGNEE
[NAME OF ASSIGNEE]
By:____________________________
Title:_________________________
[Consented to and](5) Accepted:
[NAME OF ADMINISTRATIVE AGENT], as Administrative Agent
By:____________________________
Title:_________________________
[Consented to:](6)
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*Amount to be adjusted by the counterparties to take into account any payments
or prepayments made between the Trade Date and the Effective Date.
(2) Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans
of all Lenders thereunder.
(3) Fill in the appropriate terminology for the types of facilities under the
Credit Agreement that are being assigned under this Assignment (e.g. "Revolving
Credit Commitment," "Term Loan Commitment,", etc.)
(4) Insert if satisfaction of minimum amounts is to be determined as of the
Trade Date.
(5) To be added only if the consent of the Agent is required by the terms of the
Credit Agreement.
(6) To be added only if the consent of the Borrower and/or other parties (e.g.
Swingline Lender, L/C Issuer) is required by the terms of the Credit Agreement.
[NAME OF RELEVANT PARTY]
By:_____________________________
Title:__________________________
D-3
ANNEX 1
TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor. The Assignor represents and warrants that (i) it is the
legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest
is free and clear of any lien, encumbrance or other adverse claim and (iii) it
has full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby. Neither the Assignor nor any of its officers, directors,
employees, agents or attorneys shall be responsible for (i) any statements,
warranties or representations made in or in connection with the Credit Agreement
or any other Loan Document, (ii) the execution, legality, validity,
enforceability, genuineness, sufficiency, perfection, priority, collectibility,
or value of the Loan Documents or any collateral thereunder, (iii) the financial
condition of the Borrower, any of its Subsidiaries or Affiliates or any other
Person obligated in respect of any Loan Document, (iv) the performance or
observance by the Borrower, any of its Subsidiaries or Affiliates or any other
Person of any of their respective obligations under any Loan Document, (v)
inspecting any of the property, books or records of the Borrower, or any
guarantor, or (vi) any mistake, error of judgment, or action taken or omitted to
be taken in connection with the Loans or the Loan Documents.
1.2. Assignee. The Assignee (a) represents and warrants that (i) it has
full power and authority, and has taken all action necessary, to execute and
deliver this Assignment and Assumption and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) from
and after the Effective Date, it shall be bound by the provisions of the Credit
Agreement as a Lender thereunder and, to the extent of the Assigned Interest,
shall have the obligations of a Lender thereunder, (iii) agrees that its payment
instructions and notice instructions are as set forth in Schedule 1 to this
Assignment and Assumption, (iv) confirms that none of the funds, monies, assets
or other consideration being used to make the purchase and assumption hereunder
are "plan assets" as defined under ERISA and that its rights, benefits and
interests in and under the Loan Documents will not be "plan assets" under ERISA,
(v) agrees to indemnify and hold the Assignor harmless against all losses, costs
and expenses (including, without limitation, reasonable attorneys' fees) and
liabilities incurred by the Assignor in connection with or arising in any manner
from the Assignee's non-performance of the obligations assumed under this
Assignment and Assumption, (vi) it has received a copy of the Credit Agreement,
together with copies of financial statements and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Assumption and to purchase the
Assigned Interest on the basis of which it has made such analysis and decision
independently and without reliance on the Agent or any other Lender, and (vii)
attached as Schedule 1 to this Assignment and Assumption is any documentation
required to be delivered by the Assignee with respect to its tax status pursuant
to the terms of the Credit Agreement, duly completed and executed by the
Assignee and (b) agrees that (i) it will, independently and without reliance on
the Agent, the Assignor or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Loan Documents, and
(ii) it will perform in accordance with their terms all of the
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obligations which by the terms of the Loan Documents are required to be
performed by it as a Lender.
2. Payments. The Assignee shall pay the Assignor, on the Effective Date,
the amount agreed to by the Assignor and the Assignee. From and after the
Effective Date, the Agent shall make all payments in respect of the Assigned
Interest (including payments of principal, interest, fees and other amounts) to
the Assignor for amounts which have accrued to but excluding the Effective Date
and to the Assignee for amounts which have accrued from and after the Effective
Date.
3. General Provisions. This Assignment and Assumption shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment and Assumption may be executed in any
number of counterparts, which together shall constitute one instrument. Delivery
of an executed counterpart of a signature page of this Assignment and Assumption
by telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment and Assumption. This Assignment and Assumption shall be governed
by, and construed in accordance with, the law of the State of Illinois.
D-5
ADMINISTRATIVE QUESTIONNAIRE
(Schedule to be supplied by Closing Unit or Trading Documentation Unit)
(For Forms for Primary Syndication call ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ at 312-732-8844)
(For Forms after Primary Syndication call ▇▇▇ ▇▇▇▇▇ at ▇▇▇-▇▇▇-▇▇▇▇)
US AND NON-US TAX INFORMATION REPORTING REQUIREMENTS
(Schedule to be supplied by Closing Unit or Trading Documentation Unit)
(For Forms for Primary Syndication call ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ at 312-732-8844)
(For Forms after Primary Syndication call ▇▇▇ ▇▇▇▇▇ at ▇▇▇-▇▇▇-▇▇▇▇)
D-6
EXHIBIT E
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To: Bank One, NA,
as Administrative Agent (the "Agent")
under the Credit Agreement Described Below
Re: Term Loan Credit Agreement, dated ________, 2004 (as the same may be
amended or modified, the "Credit Agreement"), among Developers Diversified
Realty Corporation, a corporation organized under the laws of the State of
Ohio (the "Borrower"), the Agent, and the Lenders named therein. Terms
used herein and not otherwise defined shall have the meanings assigned
thereto in the Credit Agreement.
The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Agent of a specific written revocation of such instructions by the Borrower,
provided, however, that the Agent may otherwise transfer funds as hereafter
directed in writing by the Borrower in accordance with Section 13.1 of the
Credit Agreement or based on any telephonic notice made in accordance with
Section 2.14 of the Credit Agreement.
Facility Identification Number(s)______________________________________________
Customer/Account Name _________________________________________________________
Transfer Funds To _____________________________________________________________
_____________________________________________________________
For Account No.________________________________________________________________
Reference/Attention To ________________________________________________________
Authorized Officer (Customer Representative) Date __________________________
____________________________________________ _______________________________
(Please Print) Signature
Bank Officer Name Date __________________________
____________________________________________ _______________________________
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
E-1
EXHIBIT F
SUBSIDIARY GUARANTY
This Guaranty is made as of _________, 2004 by the parties identified in
the signature pages thereto, and any Joinder to Guaranty hereafter delivered
(collectively, the "Subsidiary Guarantors"), to and for the benefit of Bank One,
NA, individually ("Bank One") and as administrative agent ("Administrative
Agent") for itself and the lenders under the Credit Agreement (as defined below)
and their respective successors and assigns (collectively, the "Lenders").
RECITALS
A. Developers Diversified Realty Corporation, a corporation organized
under the laws of the State of Ohio ("Borrower"), and Subsidiary Guarantors have
requested that the Lenders make a single disbursement term loan credit facility
available to Borrower in an aggregate principal amount of $200,000,000 in
accordance with the terms thereof (the "Facility").
B. The Lenders have agreed to make available the Facility to Borrower
pursuant to the terms and conditions set forth in a Term Loan Credit Agreement
of even date herewith between Borrower, Bank One, individually, and as
Administrative Agent, and the Lenders named therein (as amended, modified or
restated from time to time, the "Credit Agreement"). All capitalized terms used
herein and not otherwise defined shall have the meanings ascribed to such terms
in the Credit Agreement.
C. Borrower has executed and delivered or will execute and deliver to the
Lenders promissory notes in the principal amount of each Lender's Loan as
evidence of Borrower's indebtedness to each such Lender with respect to the
Facility (the promissory notes described above, together with any amendments or
allonges thereto, or restatements, replacements or renewals thereof, and/or new
promissory notes to new Lenders under the Credit Agreement, are collectively
referred to herein as the "Notes").
D. Subsidiary Guarantors are subsidiaries of Borrower. Subsidiary
Guarantors acknowledge that the extension of credit by the Administrative Agent
and the Lenders to Borrower pursuant to the Credit Agreement will benefit
Subsidiary Guarantors by making funds available to Subsidiary Guarantors through
Borrower and by enhancing the financial strength of the consolidated group of
which Subsidiary Guarantors and Borrower are members. The execution and delivery
of this Guaranty by Subsidiary Guarantors are conditions precedent to the
performance by the Lenders of their obligations under the Credit Agreement.
F-1
AGREEMENTS
NOW, THEREFORE, Subsidiary Guarantors, in consideration of the matters
described in the foregoing Recitals, which Recitals are incorporated herein and
made a part hereof, and for other good and valuable consideration, hereby agree
as follows:
1. Subsidiary Guarantors absolutely, unconditionally, and irrevocably
guaranty to each of the Lenders:
(a) the full and prompt payment of the principal of and interest on
the Notes when due, whether at stated maturity, upon acceleration or
otherwise, and at all times thereafter, and the prompt payment of all sums
which may now be or may hereafter become due and owing under the Notes,
the Credit Agreement, and the other Loan Documents;
(b) the payment of all Enforcement Costs (as hereinafter defined in
Paragraph 7 hereof); and
(c) the full, complete, and punctual observance, performance, and
satisfaction of all of the obligations, duties, covenants, and agreements
of Borrower under the Credit Agreement and the Loan Documents.
All amounts due, debts, liabilities, and payment obligations described in
subparagraphs (a) and (b) of this Paragraph 1 are referred to herein as the
"Facility Indebtedness." All obligations described in subparagraph (c) of this
Paragraph 1 are referred to herein as the "Obligations." Subsidiary Guarantors
and Lenders agree that Subsidiary Guarantors' obligations hereunder shall not
exceed the greater of: (i) the aggregate amount of all monies received, directly
or indirectly, by Subsidiary Guarantors from Borrower after the date hereof
(whether by loan, capital infusion or other means), or (ii) the maximum amount
of the Facility Indebtedness not subject to avoidance under Title 11 of the
United States Code, as same may be amended from time to time, or any applicable
state law (the "Bankruptcy Code"). To that end, to the extent such obligations
would otherwise be subject to avoidance under the Bankruptcy Code if Subsidiary
Guarantors are not deemed to have received valuable consideration, fair value or
reasonably equivalent value for its obligations hereunder, each Subsidiary
Guarantor's obligations hereunder shall be reduced to that amount which, after
giving effect thereto, would not render such Subsidiary Guarantor insolvent, or
leave such Subsidiary Guarantor with an unreasonably small capital to conduct
its business, or cause such Subsidiary Guarantor to have incurred debts (or
intended to have incurred debts) beyond its ability to pay such debts as they
mature, as such terms are determined, and at the time such obligations are
deemed to have been incurred, under the Bankruptcy Code. In the event a
Subsidiary Guarantor shall make any payment or payments under this Guaranty each
other guarantor of the Facility Indebtedness shall contribute to such Subsidiary
Guarantor an amount equal to such non-paying Subsidiary Guarantor's pro rata
share (based on their respective maximum liabilities hereunder and under such
other guaranty) of such payment or payments made by such Subsidiary Guarantor,
provided that such contribution right shall be subordinate and junior in right
of payment in full of all the Facility Indebtedness to Lenders.
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2. In the event of any default by Borrower in making payment of the
Facility Indebtedness, or in performance of the Obligations, as aforesaid, in
each case beyond the expiration of any applicable grace period, Subsidiary
Guarantors agree, on demand by the Administrative Agent or the holder of a Note,
to pay all the Facility Indebtedness and to perform all the Obligations as are
then or thereafter become due and owing or are to be performed under the terms
of the Notes, the Credit Agreement, and the other Loan Documents.
3. Subsidiary Guarantors do hereby waive (i) notice of acceptance of this
Guaranty by the Administrative Agent and the Lenders and any and all notices and
demands of every kind which may be required to be given by any statute, rule or
law, (ii) any defense, right of set-off or other claim which Subsidiary
Guarantors may have against Borrower or which Subsidiary Guarantors or Borrower
may have against the Administrative Agent or the Lenders or the holder of a
Note, (iii) presentment for payment, demand for payment (other than as provided
for in Paragraph 2 above), notice of nonpayment (other than as provided for in
Paragraph 2 above) or dishonor, protest and notice of protest, diligence in
collection and any and all formalities which otherwise might be legally required
to charge Subsidiary Guarantors with liability, (iv) any failure by the
Administrative Agent and the Lenders to inform Subsidiary Guarantors of any
facts the Administrative Agent and the Lenders may now or hereafter know about
Borrower, the Facility, or the transactions contemplated by the Credit
Agreement, it being understood and agreed that the Administrative Agent and the
Lenders have no duty so to inform and that Subsidiary Guarantors are fully
responsible for being and remaining informed by Borrower of all circumstances
bearing on the existence or creation, or the risk of nonpayment of the Facility
Indebtedness or the risk of nonperformance of the Obligations, and (v) any and
all right to cause a marshalling of assets of Borrower or any other action by
any court or governmental body with respect thereto, or to cause the
Administrative Agent and the Lenders to proceed against any other security given
to a Lender in connection with the Facility Indebtedness or the Obligations.
Credit may be granted or continued from time to time by the Lenders to Borrower
without notice to or authorization from Subsidiary Guarantors, regardless of the
financial or other condition of Borrower at the time of any such grant or
continuation. The Administrative Agent and the Lenders shall have no obligation
to disclose or discuss with Subsidiary Guarantors the Lenders' assessment of the
financial condition of Borrower. Subsidiary Guarantors acknowledge that no
representations of any kind whatsoever have been made by the Administrative
Agent and the Lenders to Subsidiary Guarantors. No modification or waiver of any
of the provisions of this Guaranty shall be binding upon the Administrative
Agent and the Lenders except as expressly set forth in a writing duly signed and
delivered on behalf of the Administrative Agent and the Lenders. Subsidiary
Guarantors further agree that any exculpatory language contained in the Credit
Agreement, the Notes, and the other Loan Documents shall in no event apply to
this Guaranty, and will not prevent the Administrative Agent and the Lenders
from proceeding against Subsidiary Guarantors to enforce this Guaranty.
4. Subsidiary Guarantors further agree that Subsidiary Guarantors'
liability as guarantor shall in no way be impaired by any renewals or extensions
which may be made from time to time, with or without the knowledge or consent of
Subsidiary Guarantors of the time for payment of interest or principal under a
Note or by any forbearance or delay in collecting interest
F-3
or principal under a Note, or by any waiver by the Administrative Agent and the
Lenders under the Credit Agreement, or any other Loan Documents, or by the
Administrative Agent or the Lenders' failure or election not to pursue any other
remedies they may have against Borrower, or by any change or modification in a
Note, the Credit Agreement, or any other Loan Documents, or by the acceptance by
the Administrative Agent or the Lenders of any security or any increase,
substitution or change therein, or by the release by the Administrative Agent
and the Lenders of any security or any withdrawal thereof or decrease therein,
or by the application of payments received from any source to the payment of any
obligation other than the Facility Indebtedness, even though a Lender might
lawfully have elected to apply such payments to any part or all of the Facility
Indebtedness, it being the intent hereof that Subsidiary Guarantors shall remain
liable as principal for payment of the Facility Indebtedness and performance of
the Obligations until all indebtedness has been paid in full and the other
terms, covenants and conditions of the Credit Agreement, and other Loan
Documents and this Guaranty have been performed, notwithstanding any act or
thing which might otherwise operate as a legal or equitable discharge of a
surety. Subsidiary Guarantors further understand and agree that the
Administrative Agent and the Lenders may at any time enter into agreements with
Borrower to amend and modify a Note, the Credit Agreement or any of the other
Loan Documents, or any thereof, and may waive or release any provision or
provisions of a Note, the Credit Agreement, or any other Loan Document and, with
reference to such instruments, may make and enter into any such agreement or
agreements as the Administrative Agent, the Lenders and Borrower may deem proper
and desirable, without in any manner impairing this Guaranty or any of the
Administrative Agent and the Lenders' rights hereunder or any of Subsidiary
Guarantors' obligations hereunder.
5. This is an absolute, unconditional, complete, present and continuing
guaranty of payment and performance and not of collection. Subsidiary Guarantors
agree that its obligations hereunder shall be joint and several with any and all
other guarantees given in connection with the Facility from time to time.
Subsidiary Guarantors agree that this Guaranty may be enforced by the
Administrative Agent and the Lenders without the necessity at any time of
resorting to or exhausting any security or collateral, if any, given in
connection herewith or with a Note, the Credit Agreement, or any of the other
Loan Documents or by or resorting to any other guaranties, and Subsidiary
Guarantors hereby waive the right to require the Administrative Agent and the
Lenders to join Borrower in any action brought hereunder or to commence any
action against or obtain any judgment against Borrower or to pursue any other
remedy or enforce any other right. Subsidiary Guarantors further agree that
nothing contained herein or otherwise shall prevent the Administrative Agent and
the Lenders from pursuing concurrently or successively all rights and remedies
available to them at law and/or in equity or under a Note, the Credit Agreement
or any other Loan Documents, and the exercise of any of their rights or the
completion of any of their remedies shall not constitute a discharge of any of
Subsidiary Guarantors' obligations hereunder, it being the purpose and intent of
Subsidiary Guarantors that the obligations of such Subsidiary Guarantors
hereunder shall be primary, absolute, independent and unconditional under any
and all circumstances whatsoever. Neither Subsidiary Guarantors' obligations
under this Guaranty nor any remedy for the enforcement thereof shall be
impaired, modified, changed or released in any manner whatsoever by any
impairment, modification, change, release or limitation of the liability of
Borrower under a Note, the Credit Agreement or any other Loan Document or by
reason of Borrower's bankruptcy or by reason of any creditor or
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bankruptcy proceeding instituted by or against Borrower. This Guaranty shall
continue to be effective and be deemed to have continued in existence or be
reinstated (as the case may be) if at any time payment of all or any part of any
sum payable pursuant to a Note, the Credit Agreement or any other Loan Document
is rescinded or otherwise required to be returned by the payee upon the
insolvency, bankruptcy, or reorganization of the payor, all as though such
payment to such Lender had not been made, regardless of whether such Lender
contested the order requiring the return of such payment. The obligations of
Subsidiary Guarantors pursuant to the preceding sentence shall survive any
termination, cancellation, or release of this Guaranty.
6. This Guaranty shall be assignable by a Lender to any assignee of all or
a portion of such Lender's rights under the Loan Documents.
7. If: (i) this Guaranty, a Note, or any of the Loan Documents are placed
in the hands of an attorney for collection or is collected through any legal
proceeding; (ii) an attorney is retained to represent the Administrative Agent
or any Lender in any bankruptcy, reorganization, receivership, or other
proceedings affecting creditors' rights and involving a claim under this
Guaranty, a Note, the Credit Agreement, or any Loan Document; (iii) an attorney
is retained to enforce any of the other Loan Documents or to provide advice or
other representation with respect to the Loan Documents in connection with an
enforcement action or potential enforcement action; or (iv) an attorney is
retained to represent the Administrative Agent or any Lender in any other legal
proceedings whatsoever in connection with this Guaranty, a Note, the Credit
Agreement, any of the Loan Documents, or any property subject thereto (other
than any action or proceeding brought by any Lender or participant against the
Administrative Agent alleging a breach by the Administrative Agent of its duties
under the Loan Documents), then Subsidiary Guarantors shall pay to the
Administrative Agent or such Lender upon demand all reasonable attorney's fees,
costs and expenses, including, without limitation, court costs, filing fees and
all other costs and expenses incurred in connection therewith (all of which are
referred to herein as "Enforcement Costs"), in addition to all other amounts due
hereunder.
8. The parties hereto intend that each provision in this Guaranty comports
with all applicable local, state and federal laws and judicial decisions.
However, if any provision or provisions, or if any portion of any provision or
provisions, in this Guaranty is found by a court of law to be in violation of
any applicable local, state or federal ordinance, statute, law, administrative
or judicial decision, or public policy, and if such court should declare such
portion, provision or provisions of this Guaranty to be illegal, invalid,
unlawful, void or unenforceable as written, then it is the intent of all parties
hereto that such portion, provision or provisions shall be given force to the
fullest possible extent that they are legal, valid and enforceable, that the
remainder of this Guaranty shall be construed as if such illegal, invalid,
unlawful, void or unenforceable portion, provision or provisions were not
contained therein, and that the rights, obligations and interest of the
Administrative Agent and the Lender or the holder of a Note under the remainder
of this Guaranty shall continue in full force and effect.
9. Any indebtedness of Borrower to Subsidiary Guarantors now or hereafter
existing is hereby subordinated to the Facility Indebtedness. Subsidiary
Guarantors will not seek, accept, or retain for Subsidiary Guarantors' own
account, any payment from Borrower on account of
F-5
such subordinated debt at any time when a Default or Unmatured Default exists
under the Credit Agreement or the Loan Documents, and any such payments to
Subsidiary Guarantors made while any Default or Unmatured Default then exists
under the Credit Agreement or the Loan Documents on account of such subordinated
debt shall be collected and received by Subsidiary Guarantors in trust for the
Lenders and shall be paid over to the Administrative Agent on behalf of the
Lenders on account of the Facility Indebtedness without impairing or releasing
the obligations of Subsidiary Guarantors hereunder.
10. Subsidiary Guarantors hereby subordinate to the Facility Indebtedness
any and all claims and rights, including, without limitation, subrogation
rights, contribution rights, reimbursement rights and set-off rights, which
Subsidiary Guarantors may have against Borrower arising from a payment made by
Subsidiary Guarantors under this Guaranty and agree that, until the entire
Facility Indebtedness is paid in full, not to assert or take advantage of any
subrogation rights of Subsidiary Guarantors or the Lenders or any right of
Subsidiary Guarantors or the Lenders to proceed against (i) Borrower for
reimbursement, or (ii) any other guarantor or any collateral security or
guaranty or right of offset held by the Lenders for the payment of the Facility
Indebtedness and performance of the Obligations, nor shall Subsidiary Guarantors
seek or be entitled to seek any contribution or reimbursement from Borrower or
any other guarantor in respect of payments made by Subsidiary Guarantors
hereunder. It is expressly understood that the agreements of Subsidiary
Guarantors set forth above constitute additional and cumulative benefits given
to the Lenders for their security and as an inducement for their extension of
credit to Borrower.
11. Any amounts received by a Lender from any source on account of any
indebtedness may be applied by such Lender toward the payment of such
indebtedness, and in such order of application, as a Lender may from time to
time elect.
12. Subsidiary Guarantors hereby submit to personal jurisdiction in the
State of Illinois for the enforcement of this Guaranty and waives any and all
personal rights to object to such jurisdiction for the purposes of litigation to
enforce this Guaranty. Subsidiary Guarantors hereby consent to the jurisdiction
of either the Circuit Court of ▇▇▇▇ County, Illinois, or the United States
District Court for the Northern District of Illinois, in any action, suit, or
proceeding which the Administrative Agent or a Lender may at any time wish to
file in connection with this Guaranty or any related matter. Subsidiary
Guarantors hereby agree that an action, suit, or proceeding to enforce this
Guaranty may be brought in any state or federal court in the State of Illinois
and hereby waives any objection which Subsidiary Guarantors may have to the
laying of the venue of any such action, suit, or proceeding in any such court;
provided, however, that the provisions of this Paragraph shall not be deemed to
preclude the Administrative Agent or a Lender from filing any such action, suit,
or proceeding in any other appropriate forum.
13. All notices and other communications provided to any party hereto
under this Agreement or any other Loan Document shall be in writing or by telex
or by facsimile and addressed or delivered to such party at its address set
forth below or at such other address as may be designated by such party in a
notice to the other parties. Any notice, if mailed and properly
F-6
addressed with postage prepaid, shall be deemed given when received; any notice,
if transmitted by facsimile, shall be deemed given when transmitted. Notice may
be given as follows:
To Subsidiary Guarantors:
c/o Developers Diversified Realty Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
c/o Developers Diversified Realty Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
To Bank One as Administrative Agent and as a Lender:
Bank One, NA
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Director, Capital Markets
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
F-7
If to any other Lender, to its address set forth in the Credit
Agreement.
14. This Guaranty shall be binding upon the heirs, executors, legal and
personal representatives, successors and assigns of Subsidiary Guarantors and
shall inure to the benefit of the Administrative Agent and the Lenders'
successors and assigns.
15. This Guaranty shall be construed and enforced under the internal laws
of the State of Illinois.
16. SUBSIDIARY GUARANTORS, THE ADMINISTRATIVE AGENT AND THE LENDERS, BY
THEIR ACCEPTANCE HEREOF, EACH HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY
ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHT UNDER THIS GUARANTY OR ANY
OTHER LOAN DOCUMENT OR RELATING THERETO OR ARISING FROM THE LENDING RELATIONSHIP
WHICH IS THE SUBJECT OF THIS GUARANTY AND AGREE THAT ANY SUCH ACTION OR
PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
17. From time to time, additional parties may execute a joinder
substantially in the form of Exhibit A hereto, and thereby become a party to
this Guaranty. From and after delivery of such joinder, the Subsidiary
delivering such joinder shall be a Subsidiary Guarantor, and be bound by all of
the terms and provisions of this Guaranty.
F-8
IN WITNESS WHEREOF, Subsidiary Guarantors have delivered this Guaranty in
the State of Illinois as of the date first written above.
______________________________________
By:___________________________________
By:__________________________
Its:_________________________
______________________________________
By:___________________________________
By:__________________________
Its:_________________________
______________________________________
By:___________________________________
By:__________________________
Its:_________________________
F-9
EXHIBIT A TO SUBSIDIARY GUARANTY
FORM OF JOINDER TO GUARANTY
THIS JOINDER is executed by __________, a __________ ("Subsidiary"), which
hereby agrees as follows:
1. All capitalized terms used herein and not defined in this Joinder shall
have the meanings provided in that certain Subsidiary Guaranty (the "Guaranty")
dated as of , 2004 executed for the benefit of Bank One, NA, as agent for itself
and certain other lenders, with respect to a loan from the Lenders to Developers
Diversified Realty Corporation ("Borrower").
2. As required by the Credit Agreement described in the Guaranty,
Subsidiary is executing this Joinder to become a party to the Guaranty.
3. Each and every term, condition, representation, warranty, and other
provision of the Guaranty, by this reference, is incorporated herein as if set
forth herein in full and the undersigned agrees to fully and timely perform each
and every obligation of a Subsidiary Guarantor under such Guaranty.
[INSERT SIGNATURE BLOCK]
A-1
EXHIBIT G
ENVIRONMENTAL INVESTIGATION SPECIFICATIONS AND PROCEDURES
Phase I Environmental Site Assessments to be prepared in accordance with
the ASTM Standard Practice for Environmental Site Assessments: Phase I
Environmental Site Assessment Process (ASTM Designation E1527-94), a summary of
which follows:
This ASTM practice is generally considered the industry standard for
conducting a Phase I Environmental Site Assessment (ESA). The purpose of
this standard is to "define good commercial and customary practice in the
Untied States of America for conducting an ESA of a parcel of commercial
real estate with respect to the range of contaminants within the scope of
the Comprehensive Environmental Response, Compensation and Liability Act
(CERCLA) and petroleum products." The ASTM Phase I ESA is intended to
permit a user to satisfy one of the requirements to qualify for the
innocent landowner defense to CERCLA liability; that is, the practice that
constitutes "all appropriate inquiry into the previous ownership and uses
of the property consistent with good commercial or customary practices" as
defined in 42 USC 9601(35)(B).
The goal of the ASTM Phase I ESA is to identify "recognized environmental
conditions." Recognized environmental conditions means the presence or
likely presence of any hazardous substances or petroleum products on a
property under conditions that indicate an existing release, a past
release, or a material threat of a release of any hazardous substances or
petroleum products into structures on the property or into the ground,
groundwater, or surface water of the property. The term includes hazardous
substances or petroleum products even under conditions in compliance with
laws. The term is not intended to include de minimus conditions that
generally would not be the subject of an enforcement action if brought to
the attention of appropriate governmental agencies.
The ASTM standard indicates that a Phase I ESA should consist of four main
components: 1) Records Review; 2) Site Reconnaissance; 3) Interviews; and
4) Report. The purpose of the records review is to obtain and review
records that will help identify recognized environmental conditions in
connection with the property. The site reconnaissance involves physical
observation of the property's exterior and interior, as well as an
observation of adjoining properties. Interviews with previous and current
owners and occupants, and local government officials provides insight into
the presence or absence of recognized environmental conditions in
connection with the property. The final component of the ESA, the report,
contains the findings of the ESA and conclusions regarding the presence or
absence of recognized environmental conditions in connection with the
property. It includes documentation to support the analysis, opinions, and
conclusions found in the report.
While the use of this practice is intended to constitute appropriate
inquiry for purposes of CERCLA's innocent landowner defense, it is not
intended that its use be limited to that purpose. The ASTM standard is
intended to be an approach to conducting an inquiry
G-1
designed to identify recognized environmental conditions in connection
with a property, and environmental site assessments.
G-2
SCHEDULE 1
SUBSIDIARIES
SCHEDULE 2
INDEBTEDNESS AND LIENS
(SEE SECTIONS 5.13 AND 6.16)
Maturity
Indebtedness Indebtedness Property and Amount
Incurred By Owed To Encumbered of Indebtedness
----------- ------------ ---------- ---------------
SCHEDULE 3
LITIGATION
(SEE SECTION 5.6)
SCHEDULE 4
ENVIRONMENTAL MATTERS
(SEE SECTION 5.19)
SCHEDULE 5
INTENTIONALLY DELETED
SCHEDULE 6
LIST OF SUBSIDIARY GUARANTORS