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EXHIBIT 10.1
FIRST AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
dated as of June 7, 1999
among
IRVINE APARTMENT COMMUNITIES, L.P.,
THE BANKS LISTED HEREIN,
BANK OF AMERICA NT&SA,
as Administrative Agent,
and
▇▇▇▇▇ FARGO BANK, N.A.,
as Documentation Agent
with
▇.▇. ▇▇▇▇▇▇ SECURITIES, INC.,
as Syndication Agent
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TABLE OF CONTENTS
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ARTICLE I. DEFINITIONS...................................................................1
SECTION 1.1. Definitions........................................................1
SECTION 1.2. Accounting Terms and Determinations...............................26
SECTION 1.3. Types of Borrowings...............................................27
ARTICLE II. THE CREDITS.................................................................27
SECTION 2.1. Commitments to Lend and Original Loans............................27
SECTION 2.2. Notice of Borrowing...............................................27
SECTION 2.3. Reserved..........................................................28
SECTION 2.4. Notice to Banks; Funding of Loans.................................28
SECTION 2.5. Notes.............................................................29
SECTION 2.6. Method of Electing Interest Rates.................................29
SECTION 2.7. Interest Rates....................................................31
SECTION 2.8. Reserved..........................................................32
SECTION 2.9. Fees..............................................................32
SECTION 2.10. Maturity Date....................................................33
SECTION 2.11. Optional Prepayments.............................................33
SECTION 2.12. General Provisions as to Payments................................34
SECTION 2.13. Funding Losses...................................................35
SECTION 2.14. Computation of Interest and Fees.................................36
SECTION 2.15. Use of Proceeds..................................................36
SECTION 2.16. Letters of Credit................................................36
ARTICLE III. CONDITIONS.................................................................39
SECTION 3.1. Closing...........................................................39
SECTION 3.2. Borrowings........................................................41
ARTICLE IV. REPRESENTATIONS AND WARRANTIES..............................................42
SECTION 4.1. Existence and Power...............................................42
SECTION 4.2. Power and Authority...............................................42
SECTION 4.3. No Violation......................................................43
SECTION 4.4. Financial Information.............................................43
SECTION 4.5. Litigation........................................................44
SECTION 4.6. Compliance with ERISA.............................................44
SECTION 4.7. Environmental Matters.............................................44
SECTION 4.8. Taxes.............................................................45
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SECTION 4.9. Full Disclosure...................................................45
SECTION 4.10. Solvency.........................................................45
SECTION 4.11. Use of Proceeds; Margin Regulations..............................45
SECTION 4.12. Governmental Approvals...........................................45
SECTION 4.13. Investment Company Act; Public Utility Holding Company Act.......46
SECTION 4.14. Principal Offices................................................46
SECTION 4.15. Reserved.........................................................46
SECTION 4.16. Patents, Trademarks, etc.........................................46
SECTION 4.17. Qualifying Unencumbered Properties...............................46
SECTION 4.18. No Default.......................................................47
SECTION 4.19. Licenses, etc....................................................47
SECTION 4.20. Compliance With Law..............................................47
SECTION 4.21. No Burdensome Restrictions.......................................47
SECTION 4.22. Brokers' Fees....................................................47
SECTION 4.23. Labor Matters....................................................47
SECTION 4.24. Insurance........................................................48
SECTION 4.25. Organizational Documents.........................................48
SECTION 4.26. Year 2000 Compliance..............................................48
ARTICLE V. AFFIRMATIVE AND NEGATIVE COVENANTS...........................................48
SECTION 5.1. Financial Information.............................................48
SECTION 5.2. Other Information.................................................50
SECTION 5.3. Payment of Obligations............................................52
SECTION 5.4. Maintenance of Property; Insurance; Leases........................52
SECTION 5.5. Conduct of Business and Maintenance of Existence..................52
SECTION 5.6. Compliance with Laws..............................................53
SECTION 5.7. Inspection of Property, Books and Records.........................53
SECTION 5.8. Existence.........................................................53
SECTION 5.9. Financial Covenants...............................................54
SECTION 5.10. Restriction on Fundamental Changes...............................54
SECTION 5.11. Changes in Business..............................................55
SECTION 5.12. Margin Stock.....................................................56
SECTION 5.13. Hedging Requirements.............................................56
SECTION 5.14. General Partner Status...........................................56
SECTION 5.15. Environmental Matters............................................57
SECTION 5.16. Cooperation......................................................58
SECTION 5.17. Distributions....................................................58
ARTICLE VI. DEFAULTS....................................................................58
SECTION 6.1. Events of Default.................................................58
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SECTION 6.2. Rights and Remedies...............................................61
SECTION 6.3. Notice of Default.................................................62
SECTION 6.4. Distribution of Proceeds after Default............................62
ARTICLE VII. THE AGENTS.................................................................63
SECTION 7.1. Appointment and Authorization.....................................63
SECTION 7.2. Agency and Affiliates.............................................63
SECTION 7.3. Action by Administrative Agent....................................63
SECTION 7.4. Consultation with Experts.........................................63
SECTION 7.5. Liability of Administrative Agent.................................64
SECTION 7.6. Indemnification...................................................64
SECTION 7.7. Credit Decision...................................................64
SECTION 7.8. Successor Administrative Agent....................................65
SECTION 7.9. Consents and Approvals............................................65
ARTICLE VIII. CHANGE IN CIRCUMSTANCES...................................................66
SECTION 8.1. Basis for Determining Interest Rate Inadequate or Unfair..........66
SECTION 8.2. Illegality........................................................67
SECTION 8.3. Increased Cost and Reduced Return.................................68
SECTION 8.4. Taxes.............................................................69
SECTION 8.5. Base Rate Loans Substituted for Affected LIBOR Loans..............72
ARTICLE IX. MISCELLANEOUS...............................................................72
SECTION 9.1. Notices...........................................................72
SECTION 9.2. No Waivers........................................................73
SECTION 9.3. Expenses; Indemnification.........................................73
SECTION 9.4. Sharing of Set-Offs...............................................75
SECTION 9.5. Amendments and Waivers............................................76
SECTION 9.6. Successors and Assigns............................................76
SECTION 9.7. Collateral........................................................78
SECTION 9.8. Governing Law; Submission to Jurisdiction.........................79
SECTION 9.9. Counterparts; Integration; Effectiveness..........................79
SECTION 9.10. WAIVER OF JURY TRIAL.............................................80
SECTION 9.11. Survival.........................................................80
SECTION 9.12. Domicile of Loans................................................80
SECTION 9.13. Limitation of Liability..........................................80
SECTION 9.14. Recourse Obligation..............................................80
SECTION 9.15. Bank's Failure to Fund...........................................80
SECTION 9.16. Dispute Resolution...............................................86
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Schedule 1 - Commitments
Schedule 4.6 - Borrower and General Partner ERISA Plans
Schedule 4.17 - Initial Qualified Unencumbered Property
Schedule 5.14(c)(i) - General Partner Investments
Schedule 5.14(c)(2) - General Partner Property
Exhibit A - Notice of Borrowing (Section 2.2)
Exhibit B - Reserved
Exhibit C - Reserved
Exhibit D - Reserved
Exhibit E - Reserved
Exhibit F - Reserved
Exhibit G - Form of Notice of Notice of Interest Rate Election
(Section 2.6(a)(ii))
Exhibit H - Reserved
Exhibit I - Reserved
Exhibit J - Transfer Supplement (Section 9.6(c))
Exhibit K - Request for Letter of Credit (Section 2.16)
Exhibit L - Form of L/C Application (Section 2.16)
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FIRST AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
THIS FIRST AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (this
"Agreement") dated as of June 7, 1999 among IRVINE APARTMENT COMMUNITIES, L.P.,
a Delaware limited partnership (the "Borrower"), the BANKS listed on Schedule 1
hereof, BANK OF AMERICA NT&SA, as Administrative Agent, and ▇▇▇▇▇ FARGO BANK,
N.A., as Documentation Agent.
RECITALS
(a) Pursuant to the Original Credit Agreement, the Original
Banks made the Original Loan to Borrower.
(b) Borrower, the Banks, the Administrative Agent and the
Documentation Agent desire to amend and restate the Original Credit Agreement
and certain of the Original Loan Documents, all as more particularly set forth
below.
(c) This Agreement is being executed by Borrower and the
Required Banks (in accordance with Section 9.5 of the Original Credit Agreement)
and Administrative Agent and Documentation Agent.
NOW, THEREFORE, Borrower, the Banks, the Administrative Agent
and the Documentation Agent do hereby amend and restate the Original Credit
Agreement as follows:
ARTICLE I.
DEFINITIONS
SECTION 1.1. Definitions. The following terms, as used herein,
have the following meanings:
"Adjusted London Interbank Offered Rate" has the meaning set
forth in Section 2.7(b).
"Administrative Agent" shall mean Bank of America NT&SA in its
capacity as Administrative Agent hereunder, and its permitted successors in such
capacity in accordance with the terms of this Agreement.
"Administrative Questionnaire" means, with respect to each Bank,
an administrative questionnaire in the form prepared by the Administrative Agent
and
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submitted to the Administrative Agent (with a copy to the Borrower) duly
completed by such Bank.
"Aggregate Commitment" shall mean the aggregate of all of the
Commitments hereunder, for a total of $125,000,000 unless and until such time as
the Commitments are reduced pursuant hereto.
"Agreement" shall mean this First Amended and Restated Revolving
Credit Agreement as the same may from time to time hereafter be modified,
supplemented or amended.
"Applicable Interest Rate" means (i) with respect to any Fixed
Rate Indebtedness, the fixed interest rate applicable to such Fixed Rate
Indebtedness at the time in question, and (ii) with respect to any Floating Rate
Indebtedness, either (x) the rate at which the interest rate applicable to such
Floating Rate Indebtedness is actually capped (or fixed pursuant to an interest
rate hedging device), at the time of calculation, if Borrower has entered into
an interest rate cap agreement or other interest rate hedging device with
respect thereto or (y) if Borrower has not entered into an interest rate cap
agreement or other interest rate hedging device with respect to such Floating
Rate Indebtedness, the greater of (A) the rate at which the interest rate
applicable to such Floating Rate Indebtedness could be fixed for the remaining
term of such Floating Rate Indebtedness, at the time of calculation, by
Borrower's entering into any unsecured interest rate hedging device either not
requiring an upfront payment or if requiring an upfront payment, such upfront
payment shall be amortized over the term of such device and included in the
calculation of the interest rate (or, if such rate is incapable of being fixed
by entering into an unsecured interest rate hedging device at the time of
calculation, a fixed rate equivalent reasonably determined by Administrative
Agent) or (B) the floating rate applicable to such Floating Rate Indebtedness at
the time in question.
"Applicable Lending Office" means, with respect to any Bank, (i)
in the case of its Base Rate Loans, its Domestic Lending Office, and (ii) in the
case of its LIBOR Loans, its LIBOR Lending Office.
"Applicable Margin" means, with respect to each Loan, the
respective percentages per annum determined, at any time, based on the range
into which Borrower's Credit Rating then falls, in accordance with the table set
forth below. Any change in Borrower's Credit Rating causing it to move to a
different range on the table shall effect an immediate change in the Applicable
Margin (including existing Loans). Promptly after learning of a change in the
Borrower's Credit Rating, Administrative Agent shall give notice of such change
to the Banks and include in such notice the new Applicable Margin and the
effective date of such change. In the event that two (2) different Credit
Ratings have been
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assigned, the lower of the two Credit Ratings will prevail unless such Credit
Ratings are more than one Level (as shown in the table below) apart, in which
case the average of the margins corresponding to the two Credit Ratings will
constitute the Applicable Margin. In the event that three (3) different Credit
Ratings have been assigned, the average of the margins corresponding to the two
highest Credit Ratings will constitute the Applicable Margin. For purposes of
illustration only, if (i) two (2) different Credit Ratings were assigned and one
was Level I and the other was Level III, the Applicable Margin for LIBOR Loans
would be 0.700 (i.e., the average of Level I (0.650) and Level III (0.750)); or
(ii) three (3) different Credit Ratings had been assigned and such levels were
Level I, Level III and Level IV, the Applicable Margin for LIBOR Loans would be
0.700 (i.e., the average of Level I and Level III).
Applicable
Margin for Applicable
Range of Base Rate Margin for
Borrower's Loans LIBOR Loans
Credit Rating (% per annum) (% per annum)
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Level I A-/A3
or better 0.0 0.650
Level II BBB+/Baa1 0.0 0.650
Level III BBB/Baa2 0.0 0.750
Level IV BBB-/Baa3 0.0 0.950
Level V Below Investment
Grade 0.50 1.25
"Acquired Asset" means a Qualifying Unencumbered Property which
has been acquired by Borrower (directly or indirectly) after the date of this
Agreement.
"Acquired Stabilized Asset" means a Qualifying Unencumbered
Property which had an Occupancy Rate greater than or equal to 85% on the date
acquired by Borrower.
"Approved Financial Institutions" shall mean financial
institutions which have (i)(a) a minimum net worth of $500,000,000 or (b) total
assets of $10,000,000,000, and (ii) a minimum long term debt rating of (a) BBB+
or higher by S&P, and (b) Baa1 or higher by ▇▇▇▇▇'▇.
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"Assignee" has the meaning set forth in Section 9.6(c).
"Bank" means each bank listed on Schedule 1 hereof, each
Assignee which becomes a Bank pursuant to Section 9.6(c), and their respective
successors and assigns.
"Bank of America" means Bank of America NT&SA, in its individual
capacity, or any successor to Bank of America NT&SA by merger, acquisition of
assets or otherwise.
"Bankruptcy Code" shall mean Title 11 of the United States Code,
entitled "Bankruptcy", as amended from time to time, and any successor statute
or statutes.
"Base Rate" means, for any day, a rate per annum equal to the
greater of (i) the rate of interest most recently publicly announced by the
Administrative Agent in San Francisco, California from time to time as its rate
for domestic commercial loans for such day minus 0.25% and (ii) the sum of 0.50%
plus the Federal Funds Rate for such day.
"Base Rate Loan" means a Committed Loan to be made by a Bank as
a Base Rate Loan in accordance with the applicable Notice of Borrowing or
pursuant to Article VIII.
"Benefit Arrangement" means at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Borrower" means Irvine Apartment Communities, L.P., a Delaware
limited partnership.
"Borrower Party" means the Borrower and any Subsidiary of the
Borrower. "Borrower Parties" shall mean each of the foregoing Persons
individually, and all of the foregoing Persons collectively.
"Borrower's Share" means Borrower's share of the liabilities of
an Investment Affiliate based upon Borrower's percentage ownership of such
Investment Affiliate.
"Borrowing" has the meaning set forth in Section 1.3.
"Capital Leases" as applied to any Person, means any lease of
any property (whether real, personal or mixed) by that Person as lessee which,
in conformity with
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GAAP, is or should be accounted for as a capital lease on the balance sheet of
that Person.
"Cap Rate" means the Treasury Rate plus 2.8%.
"Capital Reserve" shall mean, for any period, $50.00 for each
Fiscal Quarter to occur during such period.
"Capital Stock" means, with respect to any Person, all (i)
shares, interests, participations or other equivalents (however designated) of
capital stock and other equity interests of such Person and (ii) rights (other
than debt securities convertible into capital stock or other equity interests),
warrants or options to acquire any such capital stock or other equity interests.
"Cash and Cash Equivalents" shall mean (i) cash, (ii) direct
obligations of the United States Government, including without limitation,
treasury bills, notes and bonds, (iii) interest bearing or discounted
obligations of Federal agencies and Government sponsored entities or pools of
such instruments offered by Approved Financial Institutions and dealers,
including without limitation, Federal Home Loan Mortgage Corporation
participation sale certificates, Government National Mortgage Association
modified pass through certificates, Federal National Mortgage Association bonds
and notes, and Federal Farm Credit System securities, (iv) time deposits,
Domestic and Eurodollar certificates of deposit, bankers acceptances, commercial
paper rated at least A-1 by S&P and P-1 by ▇▇▇▇▇'▇ and/or guaranteed by an Aa
rating by ▇▇▇▇▇'▇, a AA rating by S&P or better rated credit, floating rate
notes, other money market instruments and letters of credit each issued by
Approved Financial Institutions (and in the case of a letter of credit, an
Approved Financial Institution which is a bank) (provided that the same shall
cease to be a "Cash or Cash Equivalent" if at any time any such bank shall cease
to be an Approved Financial Institution), (v) obligations of domestic
corporations, including, without limitation, commercial paper, bonds, debentures
and loan participations, each of which is rated at least AA by S&P and/or Aa2
by ▇▇▇▇▇'▇ and/or guaranteed by an Aa rating by ▇▇▇▇▇'▇, a AA rating by S&P or
better rated credit, (vi) obligations issued by states and local governments or
their agencies, rated at least MIG-1 by ▇▇▇▇▇'▇ and/or SP-1 by S&P and/or
guaranteed by an irrevocable letter of credit of an Approved Financial
Institution, which is a bank (provided that the same shall cease to be a "Cash
or Cash Equivalent" if at any time any such financial institution shall cease to
be an Approved Financial Institution), (vii) repurchase agreements with major
financial institutions and primary government security dealers fully secured by
the U.S. Government or agency collateral equal to or exceeding the principal
amount on a daily basis and held in safekeeping, and (viii) real estate loan
pool participations, guaranteed by an AA rating given by S&P or Aa2 rating given
by ▇▇▇▇▇'▇ or better rated credit.
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"Certifying Officer" has the meaning set forth in Section
5.1(c).
"Closing Date" means the date on or after the Effective Date on
which the conditions set forth in Section 3.1 shall have been satisfied to the
satisfaction of the Administrative Agent.
"Code" shall mean the Internal Revenue Code of 1986, as amended,
and as it may be further amended from time to time, any successor statutes
thereto, and applicable U.S. Department of Treasury regulations issued pursuant
thereto in temporary or final form.
"Committed Borrowing" has the meaning set forth in Section 1.3.
"Committed Loan" means a loan made by a Bank pursuant to Section
2.1; provided that, if any such loan or loans (or portions thereof) are combined
or subdivided pursuant to a Notice of Interest Rate Election, the term
"Committed Loan" shall refer to the combined principal amount resulting from
such combination or to each of the separate principal amounts resulting from
such subdivision, as the case may be.
"Commitment" means, with respect to each Bank, the amount set
forth in Schedule 1 attached hereto and incorporated herein by this reference
(and, for each Bank which is an Assignee, the amount set forth in the Transfer
Supplement entered into pursuant to Section 9.6(c) as the Assignee's
Commitment), as such amount may be reduced from time to time pursuant to Section
2.11(c) or in connection with an assignment to an Assignee.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity which is consolidated with Borrower in accordance with GAAP.
"Consolidated Tangible Net Worth" means at any date the
consolidated partners' capital (determined on a book basis and without
duplication), less their consolidated Intangible Assets and loans to officers
and directors of Borrower or its Consolidated Subsidiaries, all determined as of
such date. For purposes of this definition "Intangible Assets" means the amount
(to the extent reflected in determining such consolidated partners' capital) of
(i) unamortized deferred charges and debt discount; (ii) all write-ups (other
than write-ups resulting from foreign currency translations and write-ups of
assets of a going concern business made within twelve months after the
acquisition of such business) subsequent to December 31, 1996 in the book value
of any asset owned by the Borrower or a Consolidated Subsidiary and (iii)
goodwill, patents, trademarks, service marks, trade names, anticipated future
benefit of tax loss carry forwards, copyrights, organization or developmental
expenses and other intangible assets.
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"Contingent Obligation" means, as to any Person, without
duplication, any obligation, direct or indirect, contingent or otherwise, of
such Person (i) with respect to any Indebtedness or other obligation of another
Person, including any direct or indirect guarantee of such Indebtedness (other
than any endorsement for collection in the ordinary course of business) or any
other direct or indirect obligation, by agreement or otherwise, to purchase or
repurchase any such Indebtedness or obligation or any security therefor, or to
provide funds for the payment or discharge of any such Indebtedness or
obligation (whether in the form of loans, advances, stock purchases, capital
contributions or otherwise), (ii) to provide funds to maintain the financial
condition of any other Person, (iii) otherwise to assure or hold harmless the
holders of Indebtedness or other obligations of another Person against loss in
respect thereof, or (iv) under Hedging Contracts. The amount of any Contingent
Obligation under clause (i) or (ii) shall be the lesser of (a) the amount of
such Indebtedness or obligation guaranteed or otherwise supported thereby, or
(b) the maximum amount so guaranteed or supported. The amount of any obligation
under a Hedging Contract shall be determined in accordance with standard methods
of calculating credit exposure under similar arrangements as prescribed by the
Administrative Agent from time to time, taking into account potential movements
in interest rates, exchange rates or other relevant indices and the notional
principal amount, term and termination provisions of the arrangement. For the
purposes of this definition only, "Indebtedness" shall be deemed not to include
subclause (c) of the definition of "Indebtedness" set forth in this Agreement.
"Contractual Obligation," as applied to any Person, means any
provision of any Securities issued by that Person or any indenture, mortgage,
deed of trust, lease, contract, undertaking, document or instrument to which
that Person is a party or by which it or any of its properties is bound, or to
which it or any of its properties is subject (including without limitation any
restrictive covenant affecting such Person or any of its properties).
"Convertible Securities" means evidences of shares of stock,
limited or general partnership interests or other ownership interests, warrants,
options, or other rights or securities which are convertible into or
exchangeable for, with or without payment of additional consideration,
partnership interests of Borrower, either immediately or upon the arrival of a
specified date or the happening of a specified event.
"Credit Rating" means the rating(s) assigned by the Rating
Agencies to Borrower's senior unsecured long term indebtedness.
"Debt Restructuring" means a restatement of, or material change
in, the amortization or other financial terms of any Indebtedness of the
Borrower or any Investment Affiliate.
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"Debt Service" means, for any period, Interest Expense for such
period plus scheduled principal amortization (excluding any individual scheduled
principal payment which exceeds 25% of the original principal amount of an
issuance of Indebtedness) for such period on all Indebtedness of General Partner
(calculated as provided in Section 1.2), on a consolidated basis, plus
Borrower's Share of scheduled principal amortization for such period on all
Indebtedness of Investment Affiliates for which there is no recourse to General
Partner or Borrower (or any Property thereof), plus, without duplication,
General Partner's and Borrower's actual or potential liability for principal
amortization for such period on all Indebtedness of Investment Affiliates that
is recourse to General Partner or Borrower (or any Property thereof).
"Default" means any condition or event which with the giving of
notice or lapse of time or both would, unless cured or waived, become an Event
of Default.
"Default Rate" has the meaning set forth in Section 2.7(d).
"Documentation Agent" shall mean ▇▇▇▇▇ Fargo Bank, N.A. in its
capacity as Documentation Agent hereunder, and its successors in such capacity.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in San Francisco, California are
authorized by law to close.
"Domestic Lending Office" means, as to each Bank, its office
located at its address in the United States set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its Domestic
Lending office) or such other office as such Bank may hereafter designate as its
Domestic Lending Office by notice to the Borrower and the Administrative Agent.
"EBITDA" means, for any period, (i) Net Income for such period,
plus (ii) depreciation and amortization expense and other non-cash items
deducted in the calculation of Net Income for such period, plus (iii) Interest
Expense deducted in the calculation of Net Income for such period, plus (iv)
Taxes deducted in the calculation of Net Income for such period, plus (v)
Borrower's Share of distributed earnings of Investment Affiliates for such
period, minus (vi) the gains (and plus the losses) from extraordinary items or
asset sales or write-ups or forgiveness of indebtedness included in the
calculation of Net Income, for such period, minus (vii) Borrower's Share of
accrued income and losses of Investment Affiliates for such period minus (viii)
earnings of Subsidiaries for such period distributed to third parties, all of
the foregoing without duplication.
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"Effective Date" means the date this Agreement becomes effective
in accordance with Section 9.9.
"Environmental Affiliate" means any partnership, joint venture,
trust or corporation for which Borrower or General Partner is liable
contractually or under applicable law for Environmental Claims against such
entity.
"Environmental Approvals" means any permit, license, approval,
ruling, variance, exemption or other authorization required under applicable
Environmental Laws.
"Environmental Claim" means, with respect to any Person, any
notice, claim, demand or similar communication (written or oral) by any other
Person alleging potential liability of such Person for investigatory costs,
cleanup costs, governmental response costs, natural resources damage, property
damages, personal injuries, fines or penalties arising out of, based on or
resulting from (i) the presence, or release into the environment, of any
Materials of Environmental Concern at any location, whether or not owned by such
Person or (ii) circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law.
"Environmental Laws" means any and all federal, state, and local
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, plans, injunctions, permits, concessions, grants, licenses,
agreements and other governmental restrictions relating to the environment, or
to emissions, discharges or releases of Materials of Environmental Concern into
the environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Materials of Environmental Concern or the clean up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, or any successor statute.
"ERISA Group" means the Borrower, any Subsidiary and 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
Subsidiary, are treated as a single employer under Section 414 of the Code.
"Estimated Environmental Cost" shall have the meaning set forth
in Section 5.15 hereof.
"Event of Default" has the meaning set forth in Section 6.1.
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"Existing Letter of Credit" means the following letter of
credit: that certain Standby Letter of Credit Number 3010442, dated June 12,
1998, issued by Bank of America in favor of California Statewide Communities
Development Authority as the beneficiary, in the amount of $2,000,000, in which
Borrower is the applicant.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Domestic
Business Day next succeeding such day, provided that (i) if such day is not a
Domestic Business Day, the Federal Funds Rate for such day shall be such rate on
such transactions on the next preceding Domestic Business Day as so published on
the next succeeding Domestic Business Day, and (ii) if no such rate is so
published on such next succeeding Domestic Business Day, the Federal Funds Rate
for such day shall be the average rate quoted to the Administrative Agent on
such day on such transactions as determined by the Administrative Agent.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System as constituted from time to time.
"Fiscal Quarter" means a fiscal quarter of a Fiscal Year.
"Fiscal Year" means the fiscal year of Borrower and its
Consolidated Subsidiaries which shall be the twelve (12) month period ending on
the last day of December in each year.
"Fitch" means Fitch Investors Service, or any successor thereto.
"Fixed Charges" for any Fiscal Quarter period means the sum of
(i) Debt Service for such period, plus (ii) the greater of (a) the product of
the number of apartment units owned (directly or beneficially) by Borrower at
the beginning of the applicable period and the Capital Reserve for such period
or (b) the average quarterly amount of recurring capital expenditures of the
Borrower based upon the actual recurring capital expenditures of Borrower and
Consolidated Subsidiaries over the immediately preceding four calendar quarters,
plus (iii) Borrower's Share of the aggregate sum of the product of the number of
apartment units owned (directly or beneficially) by each Investment Affiliate at
the beginning of the applicable period and the Capital Reserve for such period,
plus (iv) dividends on preferred units payable by Borrower for such period.
"Fixed Rate Borrowing" has the meaning set forth in Section 1.3.
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"Fixed Rate Indebtedness" means all Indebtedness which accrues
interest at a fixed rate.
"Floating Rate Indebtedness" means all Indebtedness which is not
Fixed Rate Indebtedness and which is not a Contingent Obligation or an Unused
Commitment.
"FMV Cap Rate" means 8.0%.
"GAAP" means generally accepted accounting principles recognized
as such in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and the Financial
Accounting Standards Board or in such other statements by such other entity as
may be approved by a significant segment of the accounting profession, which are
applicable to the circumstances as of the date of determination.
"General Partner" means TICALLC.
"Gross Asset Value" means, with respect to any Person or
Property, (i) the product of four (4) and a fraction, the numerator of which is
EBITDA for such Fiscal Quarter (exclusive of EBITDA from any Property which has
been acquired or been disposed of by the Borrower in the Fiscal Quarter most
recently ended) and the denominator of which is the FMV Cap Rate, plus (ii) for
any Property which has been acquired by the Borrower in the Fiscal Quarter most
recently ended, the Net Price of the Property paid by Borrower for such
Property, plus (iii) in the case of any Person, the value of any Cash or Cash
Equivalents owned by such Person and not subject to any Lien, plus (iv) the
value of all construction in process (including, without limitation, the value
of the land owned by the Borrower or any Subsidiary upon which construction has
commenced, at the lower of cost or fair market value determined in accordance
with GAAP) plus (v) the value of all land owned by the Borrower or any
Subsidiary for which construction has not commenced, as of the end of the most
recently concluded Fiscal Quarter, calculated at the lower of cost or fair
market value (in each case determined in accordance with GAAP).
"Guaranty" means the Second Amended and Restated General
Continuing Repayment Guaranty, dated of the same date as this Agreement,
executed by TICALLC in favor of Administrative Agent and the Banks.
"Hedging Contract" means, for any Person, any interest rate,
commodity, foreign exchange or other hedging agreement (including swaps,
collars, caps and forward contracts) between such Person and one or more
counterparties providing for the transfer or mitigation of fluctuations of
interest rates, exchange rates or other prices either generally or under
specific contingencies.
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"IAC" means Irvine Apartment Communities, Inc., a Maryland
corporation.
"Indebtedness" as applied to any Person (and without
duplication), means (a) all indebtedness, obligations or other liabilities of
such Person for borrowed money, (b) all indebtedness, obligations or other
liabilities of such Person evidenced by Securities or other similar instruments,
(c) all Contingent Obligations of such Person exclusive of all indebtedness,
obligations and other liabilities in respect of Hedging Contracts purchased to
hedge Indebtedness, (d) all reimbursement obligations and other liabilities of
such Person with respect to letters of credit or banker's acceptances issued for
such Person's account or other similar instruments for which a contingent
liability exists, (e) all obligations of such Person to pay the deferred
purchase price of Property or services, (f) all obligations in respect of
Capital Leases (including ground leases) of such Person, (g) all indebtedness
obligations or other liabilities of such Person or others secured by a Lien on
any asset of such Person, whether or not such indebtedness, obligations or
liabilities are assumed by, or are a personal liability of such Person, (h) all
indebtedness, obligations or other liabilities (other than interest expense
liability) in respect of Interest Rate Contracts and foreign currency exchange
agreements (other than Interest Rate Contracts purchased to hedge Indebtedness),
(i) ERISA obligations currently due and payable, and (j) all trade payables for
construction in progress. As used herein, "Indebtedness" shall not include
assessment district or community facilities district indebtedness not shown on
the Borrower's balance sheet.
"Indemnitee" has the meaning set forth in Section 9.3(b).
"Initial Closing Date" means June 27, 1997.
"Interest Expense" means, for any period, the sum (without
duplication) for such period of (i) total interest expense, whether paid or
accrued, of the Borrower and the Consolidated Subsidiaries, including without
limitation the portion of any obligations under any Capital Lease allocable to
interest expense, and the Borrower's Share of interest expenses in
Unconsolidated Joint Ventures but excluding amortization or write-off of debt
discount and expense, (ii) capitalized interest, (iii) to the extent not
included in clauses (i) and (ii) the Borrower's pro rata share of interest
expense and other amounts of the type referred to in such clauses of the
Unconsolidated Joint Ventures, and (iv) interest incurred on any liability or
obligation that constitutes a contingent Obligation of Borrower or any
Consolidated Subsidiary, and in each case taking into account the benefit of any
Hedging Contract and the amortized cost therefor for the applicable period. For
purposes of clause (iii), Borrower's pro rata share of interest expense or other
amount of any Unconsolidated Joint Venture shall be deemed equal to the product
of (a) the interest expense or other relevant amount of such Unconsolidated
Joint Venture, multiplied by (b) the percentage of
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the total outstanding Capital Stock of such Person held by Borrower or any
Consolidated Subsidiary, expressed as a decimal.
"Interest Period" means, with respect to each LIBOR Borrowing,
the period commencing on the date of such Borrowing specified in the Notice of
Borrowing or on the date specified in the applicable Notice of Interest Rate
Election and ending 1, 2, 3, or 6 months thereafter, as the Borrower may elect
in the applicable Notice of Borrowing or Notice of Interest Rate Election;
provided that: (a) any Interest Period which would otherwise end on a day which
is not a LIBOR Business Day shall be extended to the next succeeding LIBOR
Business Day unless such LIBOR Business Day falls in another calendar month, in
which case such Interest Period shall end on the next preceding LIBOR Business
Day; (b) any Interest Period which begins on the last LIBOR Business Day of a
calendar month (or on a day for which there is no numerically corresponding day
in the calendar month at the end of such Interest Period) shall, subject to
clause (c) below, end on the last LIBOR Business Day of a calendar month; and
(c) any Interest Period which would otherwise end after the Maturity Date shall
end on the Maturity Date.
"Interest Rate Contracts" means, collectively, interest rate
swap, collar, cap or similar agreements providing interest rate protection.
"Interest Rate ▇▇▇▇▇▇" has the meaning set forth in Section
5.13.
"Investment" means, with respect to any Person, (i) any direct
or indirect purchase or other acquisition by that Person of stock or securities,
or any beneficial interest in stock or other securities, of any other Person,
any partnership interest (whether general or limited) in any other Person, or
all or any substantial part of the business or assets of any other Person, (ii)
any direct or indirect loan, advance or capital contribution by that Person to
any other Person, including all indebtedness and accounts receivable from that
other Person that are not current assets or did not arise from sales to that
other Person in the ordinary course of business. The amount of any Investment
shall be the original cost of such Investment plus the cost of all additions
thereto, without any adjustments for increases or decreases in value, or
write-ups, write-downs or write-offs with respect to such Investment.
"Investment Affiliate" means any Person in whom Borrower holds
an equity interest, directly or indirectly, whose financial results are not
consolidated under GAAP with the financial results of Borrower on the
consolidated financial statements of Borrower.
"Joint Venture" means a joint venture, partnership or similar
arrangement, whether in corporate, partnership or other legal form.
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"L/C Agreement" means (a) so long as Bank of America is the
Administrative Agent and issuer of Letters of Credit pursuant to Section 2.16, a
letter of credit application and reimbursement agreement in the form of Exhibit
"L"; and (b) if Bank of America ceases to be the Administrative Agent or the
Agreement is amended to provide for a Bank other than Bank of America to be the
issuer of Letters of Credit pursuant to Section 2.16, a letter of credit
application in form and content reasonably satisfactory to the successor
Administrative Agent or such Bank, as the case may be.
"Letter of Credit" means a standby or direct pay letter of
credit issued for the account of Borrower pursuant to this Agreement, either as
originally issued as the same may from time to time be supplemented, modified,
amended, renewed or extended.
"Letter of Credit Fee" means, with respect to each Letter of
Credit issued, a fee equal to the face amount of the applicable Letter of Credit
multiplied by the Letter of Credit Margin. The Letter of Credit Fee shall be
payable in advance as follows: (i) the first installment of the Letter of Credit
Fee shall be due upon the issuance, supplementation, modification, amendment,
renewal or extension, as the case may be, of any Letter of Credit; and (ii)
subsequent installments shall be due quarterly thereafter. The amount of each
installment pursuant to clause (i) above shall be one quarter of the product of
(y) the applicable Letter of Credit Fee for the date the payment is due and (z)
the face amount of the Letter of Credit issued, supplemented, modified, amended,
renewed or extended. The amount of each installment pursuant to clause (ii)
above shall be one quarter of the product of (y) the applicable Letter of Credit
Fee for the date the payment is due and (z) the face amount of the Letter of
Credit then outstanding.
"Letter of Credit Margin" means, with respect to each Letter of
Credit, the respective percentages per annum determined, at any time, based on
the range into which Borrower's Credit Rating falls on the date of issuance of
the applicable Letter of Credit, in accordance with the table set forth below
(the percentage set forth in the Letter of Credit Margin column is inclusive of
the percentage set forth in the Override to Administrative Agent column). In the
event that two (2) different Credit Ratings have been assigned, the lower of the
two Credit Ratings will prevail unless such Credit Ratings are more than one
Level (as shown in the table below) apart, in which case the average of the
margins corresponding to the two Credit Ratings will constitute the Letter of
Credit Margin. In the event that three (3) different Credit Ratings have been
assigned, the average of the margins corresponding to the two highest Credit
Ratings will constitute the
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Letter of Credit Margin. For purposes of illustration only, if (i) two (2)
different Credit Ratings were assigned and one was Level I and the other was
Level III, the Letter of Credit Margin would be 0.700 (i.e., the average of
Level I (0.650) and Level III (0.750)); or (ii) three (3) different Credit
Ratings had been assigned and such levels were Level I, Level III and Level IV,
the Letter of Credit Margin would be 0.700 (i.e., the average of Level I and
Level III).
Range of Letter of Override to
Borrower's Credit Margin Administrative Agent
Credit Rating (% per annum) (% per annum)
------------- ------------- -------------
Level I A-/A3
or better 0.650 0.100
Level II BBB+/Baa1 0.650 0.100
Level III BBB/Baa2 0.750 0.100
Level IV BBB-/Baa3 0.950 0.100
Level V Below Investment
Grade 1.250 0.100
"LIBOR Borrowing" has the meaning set forth in Section 1.3.
"LIBOR Business Day" means any Domestic Business Day on which
commercial banks are open for international business (including dealings in
dollar deposits) in London.
"LIBOR Lending Office" means, as to each Bank, its office,
branch or affiliate located at its address set forth in its Administrative
Questionnaire (or identified in its Administrative Questionnaire as its LIBOR
Lending Office) or such other office, branch or affiliate of such Bank as it may
hereafter designate as its LIBOR Lending Office by notice to the Borrower and
the Administrative Agent.
"LIBOR Loan" means a Committed Loan to be made by a Bank as a
LIBOR Loan in accordance with the applicable Notice of Borrowing.
"LIBOR Reserve Percentage" has the meaning set forth in Section
2.7(b).
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"Lien" means with respect to any Property, any mortgage, pledge,
negative pledge, charge, security interest or encumbrance of any kind, or any
other type of preferential arrangement, in each case that has the effect of
creating a security interest, in respect of such Property, including without
limitation, all assessment district and community facility district debt shown
on the balance sheet of the owner of such Property. For the purposes of this
Agreement, the Borrower or any Consolidated Subsidiary shall be deemed to own
subject to a Lien any Property which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such Property.
"Loan" means a Base Rate Loan or a LIBOR Loan and "Loans" means
Base Rate Loans, LIBOR Loans or any combination of the foregoing.
"Loan Documents" means this Agreement, the Notes and the
Guaranty, as each of them may from time to time hereafter be modified,
supplemented or amended.
"London Interbank Offered Rate" or "LIBOR" has the meaning set
forth in Section 2.7(b).
"Mandate Letter" means that certain letter dated June 4, 1997,
as amended or supplemented from time to time, between Borrower and the
Administrative Agent.
"Margin Stock" shall have the meaning provided such term in
Regulation U and Regulation G of the Federal Reserve Board.
"Material Adverse Effect" means an effect resulting from any
circumstance or event or series of circumstances or events, of whatever nature
(but excluding general economic conditions), which does or could reasonably be
expected to, materially and adversely (i) effect the business, operations,
properties, assets or financial condition of the Borrower and its Consolidated
Subsidiaries taken as a whole, or (ii) impair the ability of the Borrower and
its Consolidated Subsidiaries, taken as a whole, to perform their respective
obligations under the Loan Documents.
"Materials of Environmental Concern" means any chemical
substance (i) the presence of which requires investigation or remediation under
any Environmental Laws; or (ii) that is or becomes defined as a "hazardous
waste" or "hazardous substance" under any Environmental Laws, including the
Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C.
Section 9601 et seq.) or the Resource Conservation and Recovery Act (42 U.S.C.
Section 6901 et seq.); or (iii) that is toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic, or otherwise hazardous and is
or becomes regulated by any governmental authority; or (iv)
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the presence of which on any Real Property Asset causes a nuisance upon the Real
Property Asset or to adjacent properties or poses a hazard to any Real Property
Asset or to the health or safety of Persons on or about any Real Property Asset;
or (v) without limitation, which contains gasoline, diesel fuel or other
petroleum hydrocarbons; or (vi) without limitation which contains
polychlorinated biphenyls (PCBs) or asbestos.
"Maturity Date" shall mean the date when all of the Obligations
hereunder shall be due and payable which shall be June 27, 2001, unless
accelerated pursuant to the terms hereof.
"Merger" means the merger of IAC into TICALLC.
"Merger Date" means the date upon which the Merger is legally
effective.
"Moody's" means ▇▇▇▇▇'▇ Investors Services, Inc. or any
successor thereto.
"▇▇▇▇▇▇" means ▇▇▇▇▇▇ Guaranty Trust Company of New York, in its
individual capacity.
"Multiemployer Plan" means at any time an employee pension
benefit plan within the meaning of Section 4001(a)(3) of ERISA to which any
member of the ERISA Group is then making or accruing an obligation to make
contributions or has within the preceding five plan years made contributions,
including for these purposes any Person which ceased to be a member of the ERISA
Group during such five year period.
"Multiple Employer Plan" means a Plan to which Section 413(c) of
the Code applies.
"Net Income" means, for any period, the net earnings (or loss)
after Taxes of the Borrower, on a consolidated basis for such period, calculated
in conformity with GAAP.
"Net Offering Proceeds" means all cash or other assets received
by Borrower as a result of the sale or issuance of common shares of beneficial
interest, preferred shares of beneficial interest, partnership interests,
limited liability company interests, Convertible Securities or other ownership
or equity interests in Borrower less customary costs and discounts of issuance
paid by Borrower, as the case may be.
"Net Operating Income" means, for any period with respect to any
Property owned (directly or beneficially) by Borrower, the net operating income
of such Property for such period (i) determined in accordance with GAAP, (ii)
determined in a manner
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which is consistent with the past practices of Borrower, and (iii) inclusive of
an allocation of reasonable management fees and administrative costs to each
Property, consistent with the past practices of Borrower, except that, for
purposes of determining Net Operating Income, income shall not (a) include any
items reasonably deemed by Administrative Agent to be of a non-recurring nature
or (b) be reduced by depreciation or amortization.
"Net Price" means, with respect to the purchase and sale of any
Property, without duplication, (i) Cash and Cash Equivalents paid as
consideration for such purchase or sale (after adjusting for the proration of
taxes, assessments, utility and security deposits and other items prorated or
adjusted) plus (ii) the principal amount of any note received or other deferred
payment to be made in connection with such purchase or sale (except as described
in clause (iv) below), plus (iii) the value of any other considerations
delivered in connection with such purchase or sale (as reasonably determined by
Administrative Agent), minus (only in the case of a sale) (iv) until actually
received, the value of any consideration deposited into escrow or subject to
disbursement or claim upon the occurrence of any event, minus (only in the case
of a sale), (v) the value of any consideration required to be paid to any Person
other than the Borrower and its Subsidiaries owning a beneficial interest in
such Property, minus (vi) reasonable costs of sale and taxes paid or payable in
connection with such purchase or sale.
"Net Present Value" shall mean, as to a specified or
ascertainable dollar amount, the present value, as of the date of calculation of
any such amount using a discount rate equal to the Base Rate in effect as of the
date of such calculation.
"Non-Recourse Indebtedness" means Indebtedness with respect to
which recourse is limited to (i) specific assets related to a particular
Property or group of Properties encumbered by a Lien securing such Indebtedness
or (ii) any Subsidiary (provided that if a Subsidiary is a partnership, there is
no recourse to Borrower or General Partner); provided, however, that personal
recourse of Borrower or General Partner for any such Indebtedness for fraud,
misrepresentation, misapplication of cash, waste, environmental claims and
liabilities and other circumstances customarily excluded by institutional
lenders from exculpation provisions and/or included in separate indemnification
agreements in non-recourse financing of real estate shall not, by itself,
prevent such Indebtedness from being characterized as Non-Recourse Indebtedness.
"Notes" means the "Notes" as defined in the Original Credit
Agreement, and "Note" means any one of such "Notes".
"Notice of Borrowing" means a Notice of Borrowing (as defined in
Section 2.4).
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"Notice of Interest Rate Election" has the meaning set forth in
Section 2.6.
"Obligations" means all obligations, liabilities, indemnity
obligations and Indebtedness of every nature of the Borrower, from time to time
owing to Administrative Agent or any Bank under or in connection with this
Agreement or any other Loan Document.
"Occupancy Rate" with respect to any Real Property Asset, shall
mean the ratio of (a) apartment units in such Real Property Asset which are
physically occupied by tenants paying rent pursuant to a lease to (b) the number
of apartment units in such Real Property Asset, expressed as a percentage.
"Other Indebtedness" means all Indebtedness other than the
Obligations.
"Original Banks" means the "Banks" listed on the signature pages
of the Original Credit Agreement.
"Original Credit Agreement" means that certain Revolving Credit
Agreement, dated as of June 27, 1997, by and among Borrower, the Banks listed
therein, Bank of America NT&SA, as Administrative Agent, and ▇▇▇▇▇ Fargo Bank,
N.A., as Documentation Agent, as amended by (a) that certain First Amendment to
Revolving Credit Agreement, dated as of July 10, 1998, by and among Borrower,
the Banks listed therein, Bank of America NT&SA, as Administrative Agent, and
▇▇▇▇▇ Fargo Bank, N.A., as Documentation Agent, and (b) that certain Second
Amendment to Revolving Credit Agreement, dated as of August 4, 1998, by and
among Borrower, the Banks listed therein, Bank of America NT&SA, as
Administrative Agent, and ▇▇▇▇▇ Fargo Bank, N.A., as Documentation Agent.
"Original Guarantor" means the "Guarantor" as defined in the
Original Credit Agreement.
"Original Guaranty" means the "Guaranty" as defined in the
Original Credit Agreement.
"Original Loan Documents" means that the "Loan Documents" as
defined in the Original Credit Agreement.
"Original Notes" means the "Notes", the "Money Market Notes" and
the "Swing Line Notes", all as defined in the Original Credit Agreement.
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"Parent" means, with respect to any Bank, any Person controlling
such Bank.
"Participant" has the meaning set forth in Section 9.6(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Liens" means:
a. liens for Taxes, assessments or other governmental
charges not yet due and payable or which are being contested in good
faith by appropriate proceedings promptly instituted and diligently
conducted in accordance with the terms hereof;
b. statutory liens of carriers, warehousemen, mechanics,
materialmen and other similar liens imposed by law, which are incurred
in the ordinary course of business for sums not more than sixty (60)
days delinquent or which are being contested in good faith in accordance
with the terms hereof;
c. deposits made in the ordinary course of business to
secure liabilities to insurance carriers;
d. liens for purchase money obligations for equipment;
provided that (i) the Indebtedness secured by any such Lien does not
exceed the purchase price of such equipment, and (ii) any such Lien
encumbers only the asset so purchased and the proceeds upon sale,
disposition, loss or destruction thereof;
e. easements, rights-of-way, zoning restrictions, other
similar charges or encumbrances and all other items listed on Schedule B
to Borrower's owner's title insurance policies, except in connection
with any Indebtedness, for any of Borrower's Real Property Assets, so
long as the foregoing do not interfere in any material respect with the
use or ordinary conduct of the business of Borrower and do not diminish
in any material respect the value of the Property to which it is
attached or for which it is listed;
f. liens and judgments which have been or will be bonded or
released of record within thirty (30) days after the date such Lien or
judgment is entered or filed against General Partner, Borrower, or any
Subsidiary;
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g. liens on Property of the Borrower or its Subsidiaries
(other than Qualifying Unencumbered Property) securing Indebtedness
which may be incurred or remain outstanding without resulting in an
Event of Default hereunder; and
h. assessment or community facilities district
indebtedness, in each case not then in default, building restrictions,
zoning laws and the like, and residential leases entered into in the
ordinary course of business.
"Person" means an individual, a corporation, a partnership,
joint venture, limited liability company, an association, a trust or any other
entity or organization, including a government or political subdivision or an
agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan (other
than a Multiemployer Plan) which is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Code and either (i) is
maintained, or contributed to, by any member of the ERISA Group for employees of
any member of the ERISA Group or (ii) has at any time within the preceding five
years been maintained, or contributed to, by any Person which was at such time a
member of the ERISA Group for employees of any Person which was at such time a
member of the ERISA Group.
"Property" means, with respect to any Person, any real or
personal property, building, facility, structure, equipment or unit, or other
asset owned by such Person.
"Qualifying Unencumbered Property" means, as of the Initial
Closing Date, the Real Property Assets set forth on Schedule 4.17 hereto (the
"Initial Qualifying Unencumbered Properties") and thereafter any other Real
Property Assets (without duplication) as designated by Borrower from time to
time; provided, however that each such Real Property Asset, including the
Initial Qualifying Unencumbered Property, must: (v) be a Real Property Asset
upon which an apartment project and related improvements has been, or is being,
constructed; (w) be wholly-owned (directly or beneficially) by Borrower; (x) not
be subject (nor may any equity interests in such Property be subject) to a Lien
(other than Permitted Liens) which secures Indebtedness of any Person; (y) not
be subject (nor may any equity interests in such Property be subject) to any
covenant, condition, or other restriction which prohibits the creation or
assumption of any Lien upon such Real Property Asset; and (z) to the best
knowledge of Borrower, not have Materials of Environmental Concern located on,
under or above such Real Property Asset, which are reasonably expected, pursuant
to Section 5.15, to involve an expenditure of Significant Environmental Cost.
The Borrower may designate, in its sole discretion and at any time, the Real
Property Assets which satisfy the requirements set forth herein and are thus
Qualifying Unencumbered Properties. If, at any time, a Real Property Asset
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does not satisfy the requirements of subclauses (v) through (z) above, then it
shall not be a Qualifying Unencumbered Property.
"Rating Agencies" means, collectively, S&P, ▇▇▇▇▇'▇ and Fitch;
other nationally recognized rating agencies shall be "Rating Agencies" following
approval thereof by the Administrative Agent.
"Real Property Asset(s)" means as of any time, the real property
asset(s) owned directly or indirectly by the Borrower and the Consolidated
Subsidiaries at such time.
"Recourse Debt" shall mean Indebtedness that is not Non-Recourse
Indebtedness.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"Required Banks" means at any time Banks having at least 61% of
the Aggregate Commitments or, if the Commitments shall have been terminated,
holding Notes evidencing at least 61% of the aggregate unpaid principal amount
of the Loans.
"Restricted Payment" means (i) any dividend or other
distribution, direct or indirect, on account of any Capital Stock of any
Borrower Party now or hereafter outstanding, except (a) a dividend or other
distribution payable solely in shares or equivalents of the same class of
Capital Stock and (b) the issuance of equity interests upon the exercise of
outstanding warrants, options or other rights, or (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any Capital Stock of any Borrower Party now or
hereafter outstanding.
"S&P" means Standard & Poor's Ratings Services, a division of
The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., or any successor thereto.
"Secured Debt" means Indebtedness, the payment of which is
secured by a Lien on any Property owned or leased by General Partner, Borrower,
or any Subsidiary.
"Securities" means any stock, partnership interests, shares,
shares of beneficial interest, voting trust certificates, bonds, debentures,
notes or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities," or any certificates of interest, shares, or participations in
temporary or interim certificates for the purchase or acquisition of, or any
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right to subscribe to, purchase or acquire any of the foregoing, but shall not
include any evidence of the obligations.
"Series A Preferred Securities" means the 8 1/4% Series A REIT
Trust Originated Preferred Securities sold by IAC Capital Trust, a Delaware
business trust.
"Series B Preferred Securities" means the Series B Preferred
Limited Partner Units issued by Borrower pursuant to the Designation Instrument
for such Series B Preferred Limited Partner Units.
"Significant Environmental Costs" means, as to any Real Property
Asset, Estimated Environmental Costs determined pursuant to Section 5.15 hereof,
to exceed one and one-half percent (1.5%) of (i) the Gross Asset Value of such
Real Property Asset in the case of a Real Property Asset that has been fully
constructed, or (ii) the sum of land cost (at the lower of cost or fair market
value) plus Borrower's estimated construction cost in the case of any other Real
Property Asset.
"Stabilized Asset" means any Qualifying Unencumbered Property
which, while owned by Borrower achieved (i) an average Occupancy Rate greater
than or equal to 85% during a calendar month and (ii) an Occupancy Rate of at
least 85% on the last day of such month. As used herein, "Stabilized Asset"
means any Qualifying Unencumbered Property which, while owned by Borrower, at
one time satisfied the foregoing requirements, regardless of whether such
Property subsequently fails to maintain such Occupancy Rates.
"Solvent" means, with respect to any Person, that the fair
saleable value of such Person's assets exceeds the Indebtedness of such Person.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by the Borrower.
"Super-Majority Banks" means at any time Banks having at least
66 of the Aggregate Commitment or, if the Commitments shall have been
terminated, holding Notes evidencing at least 66 2/3% of the aggregate unpaid
principal amount of the Loans.
"Syndication Agent" shall mean ▇.▇. ▇▇▇▇▇▇ Securities, Inc.
"Taxes" means all federal, state, local and foreign income and
gross receipts taxes.
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"Term" has the meaning set forth in Section 2.10.
"Termination Event" shall mean (i) a "reportable event", as such
term is described in Section 4043 of ERISA (other than a "reportable event" not
subject to the provision for 30-day notice to the PBGC), or an event described
in Section 4062(e) of ERISA, (ii) the withdrawal by any member of the ERISA
Group from a Multiple Employer Plan during a plan year in which it is a
"substantial employer" (as defined in Section 4001(a)(2) of ERISA), or the
incurrence of liability by any member of the ERISA Group under Section 4064 of
ERISA upon the termination of a Multiple Employer Plan, (iii) the filing of a
notice of intent to terminate any Plan under Section 4041 of ERISA, other than
in a standard termination within the meaning of Section 4041 of ERISA, or the
treatment of a Plan amendment as a distress termination under Section 4041 of
ERISA, (iv) the institution by the PBGC of proceedings to terminate, impose
liability (other than for premiums under Section 4007 of ERISA) in respect of,
or cause a trustee to be appointed to administer, any Plan or (v) any other
event or condition that might reasonably constitute grounds for the termination
of, or the appointment of a trustee to administer, any Plan or the imposition of
any liability or encumbrance or Lien on the Real Property Assets or any member
of the ERISA Group under ERISA.
"TIC" means The Irvine Company, a Delaware corporation.
"TICALLC" means TIC Acquisition LLC, a Delaware limited
liability company.
"Total Liabilities" means, as of the date of determination and
without duplication, all Indebtedness of General Partner (calculated as provided
in Section 1.2), on a consolidated basis, plus Borrower's Share of all
Indebtedness of Investment Affiliates for which there is no recourse to General
Partner or Borrower (or any Property thereof) plus the actual or potential
liability of General Partner, Borrower or any Subsidiary for any Indebtedness of
Investment Affiliates that is recourse to General Partner or Borrower (or
Property thereof) plus accounts payable incurred in the ordinary course of
business, plus all other items which, in accordance with GAAP, would be included
as liabilities on the liability side of the balance sheet of such Person.
"Treasury Rate" means, as of any date, a rate equal to the
annual yield to maturity on the U.S. Treasury Constant Maturity Series with a
ten year maturity, as such yield is reported in Federal Reserve Statistical
Release H.15 -- Selected Interest Rates, published most recently prior to the
date the applicable Treasury Rate is being determined. Such yield shall be
determined by straight line linear interpolation between the yields reported in
Release H.15, if necessary. In the event Release H.15 is no longer published,
the Administrative Agent shall select, in its reasonable discretion, an
alternate basis for the
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determination of Treasury yield for U.S. Treasury Constant Maturity Series with
ten year maturities.
"Unconsolidated Joint Venture" means (i) any Joint Venture of
Borrower or any Consolidated Subsidiary in which Borrower or such Consolidated
Subsidiary holds any Capital Stock but which would not be combined with Borrower
or such Consolidated Subsidiary in the consolidated financial statements of
Borrower in accordance with GAAP, and (ii) any Investment of Borrower or any
Consolidated Subsidiary in any Person that is not a Joint Venture.
"Unencumbered Asset Pool Value" means, without duplication, the
sum of the following with respect to Qualifying Unencumbered Properties:
(i) the Net Price of any Acquired Asset that was acquired
(directly or indirectly) by the Borrower during the most recent Fiscal Quarter;
plus
(ii) the aggregate Unencumbered Net Operating Income for the
three (3) calendar months most recently ended multiplied by four (4) and divided
by the FMV Cap Rate with respect to (v) any Acquired Stabilized Asset that was
acquired (directly or indirectly) by the Borrower during one of the four (4)
consecutive Fiscal Quarters most recently ended (other than the most recent
Fiscal Quarter), (w) any Acquired Asset which was not an Acquired Stabilized
Asset and which has not become a Stabilized Asset during one of the four (4)
consecutive Fiscal Quarters most recently ended, (x) any Acquired Asset which
was not an Acquired Stabilized Asset but which has become a Stabilized Asset
during one of the four (4) consecutive Fiscal Quarters most recently ended, (y)
any Qualifying Unencumbered Property which became a Stabilized Asset during the
four (4) consecutive Fiscal Quarters most recently ended, and (z) any Qualifying
Unencumbered Property which is not a Stabilized Asset (provided, however, that
the Unencumbered Asset Pool Value attributable to the Qualifying Unencumbered
Properties included in subclauses (w) and (z) above, together with Acquired
Assets in (i) above which were not Acquired Stabilized Assets, may not exceed
twenty-five percent (25%) of the aggregate Unencumbered Asset Pool Value); and
(iii) the aggregate Unencumbered Net Operating Income for the
four (4) consecutive Fiscal Quarters most recently ended divided by the FMV Cap
Rate with respect to (x) any Acquired Stabilized Asset which has been owned
(directly or beneficially) by the Borrower for more than four (4) consecutive
Fiscal Quarters and which is a Qualifying Unencumbered Property, and (y) any
Qualifying Unencumbered Property which became a Stabilized Asset prior to the
beginning of the four (4) consecutive Fiscal Quarters most recently ended and
which has been owned (directly or indirectly) by the Borrower for more than four
(4) consecutive Fiscal Quarters.
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Notwithstanding the foregoing, in the event that Borrower or Administrative
Agent has determined that there is a Significant Environmental Cost with respect
to any Real Property Asset referred to in this definition (and only for so long
as Borrower or Administrative Agent has made such determination), then the value
attributed to such asset shall be reduced, but not below zero, by the amount of
such Significant Environmental Cost.
"Unencumbered Net Operating Income" means for any period for all
Qualifying Unencumbered Properties owned (directly or beneficially) by the
Borrower during the applicable period, Net Operating Income from each such
Qualifying Unencumbered Property.
"United States" means the United States of America, including
the fifty states and the District of Columbia.
"Unsecured Debt" means Indebtedness of Borrower which is not
Secured Debt, including without limitation the aggregate amount of all Loans
outstanding hereunder.
"Unsecured Interest Expense" means Interest Expense other than
Interest Expense payable in respect of Secured Debt.
"Unused Commitments" shall mean an amount equal to all
unadvanced funds (other than unadvanced funds in connection with any
construction loan) which any third party is obligated to advance to Borrower or
another Person or otherwise pursuant to any loan document, written instrument or
otherwise.
"▇▇▇▇▇ Fargo" means ▇▇▇▇▇ Fargo Bank, N.A., in its individual
capacity, or any successor to ▇▇▇▇▇ Fargo Bank, N.A., by merger, acquisition of
assets or otherwise.
SECTION 1.2. Accounting Terms and Determinations. Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP applied on a basis consistent (except for changes concurred
in by Ernst & Young LLP) with the most recent audited consolidated financial
statements of the Borrower and its Consolidated Subsidiaries delivered to the
Administrative Agent; provided that for purposes of references to the financial
results and information of "General Partner, on a consolidated basis," General
Partner shall be deemed to own one hundred percent (100%) of the partnership
interests in Borrower; and provided further that, if the Borrower notifies the
Administrative Agent that the Borrower wishes to amend any covenant in Article V
to
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eliminate the effect of any change in GAAP on the operation of such covenant (or
if the Administrative Agent notifies the Borrower that the Required Banks wish
to amend Article V for such purpose), then the Borrower's compliance with such
covenant shall be determined on the basis of GAAP in effect immediately before
the relevant change in GAAP became effective, until either such notice is
withdrawn or such covenant is amended in a manner reasonably satisfactory to the
Borrower and the Required Banks.
SECTION 1.3. Types of Borrowings. The term "Borrowing" denotes
the aggregation of Loans of one or more Banks to be made to the Borrower
pursuant to Article 2 on the same date, all of which Loans are of the same type
(subject to Article VIII) and, except in the case of Base Rate Loans, have the
same initial Interest Period. Borrowings are classified for purposes of this
Agreement either by reference to the pricing of Loans comprising such Borrowing
(e.g., a "Fixed Rate Borrowing" is a LIBOR Borrowing, and a "LIBOR Borrowing" is
a Borrowing comprised of LIBOR Loans) or by reference to the provisions of
Article 2 under which participation therein is determined (i.e., a "Committed
Borrowing" is a Borrowing under Section 2.1 in which all Banks participate in
proportion to their Commitments).
ARTICLE II.
THE CREDITS
SECTION 2.1. Commitments to Lend and Original Loans. (a) Each
Bank severally agrees, on the terms and conditions set forth in this Agreement,
to make Loans to the Borrower pursuant to this Article from time to time during
the term hereof in amounts such that the aggregate principal amount of Committed
Loans by such Bank at any one time outstanding shall not exceed the amount of
its Commitment. Each Borrowing outstanding under this Section 2.1 shall be in an
aggregate principal amount of $3,000,000 for LIBOR Loans or $500,000 for Base
Rate Loans, or an integral multiple of $100,000 in excess thereof (except that
any such Borrowing may be in the aggregate amount available in accordance with
Section 3.2(c)) and shall be made from the several Banks ratably in proportion
to their respective Commitments. Subject to the limitations set forth herein,
any amounts repaid may be reborrowed.
(b) As of the Effective Date, the "Loans" outstanding under
the Original Credit Agreement shall be deemed Loans hereunder.
SECTION 2.2. Notice of Borrowing. The Borrower shall give
Administrative Agent notice, in the form set forth as Exhibit "A" attached
hereto and incorporated herein by this reference ("Notice of Borrowing"), not
later than 11:00 a.m.
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(San Francisco time) (x) one Domestic Business Day before each Base Rate
Borrowing, or (y) three LIBOR Business Days before each LIBOR Borrowing,
specifying:
(i) the date of such Borrowing, which shall be a
Domestic Business Day in the case of a Base Rate Borrowing or a LIBOR Business
Day in the case of a LIBOR Borrowing;
(ii) the aggregate amount of such Borrowing;
(iii) whether the Loans comprising such Borrowing are
to be Base Rate Loans or LIBOR Loans; and
(iv) in the case of a LIBOR Borrowing, the duration
of the Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
SECTION 2.3. Reserved.
SECTION 2.4. Notice to Banks; Funding of Loans.
(a) Upon receipt of a notice from Borrower in accordance
with Section 2.2 hereof (each such notice being a "Notice of Borrowing"), the
Administrative Agent shall, on the date such Notice of Borrowing is received by
the Administrative Agent, notify each Bank of the contents thereof and of such
Bank's share of such Borrowing, of the interest rate determined pursuant thereto
and the Interest Period(s) and such Notice of Borrowing shall not thereafter be
revocable by the Borrower.
(b) Not later than 12:00 Noon (San Francisco time) on the
date of each Borrowing as indicated in the Notice of Borrowing, each Bank shall
(except as provided in subsection (c) of this Section) make available its share
of such Borrowing in Federal funds immediately available in San Francisco, to
the Administrative Agent at its address referred to in Section 9.1.
(c) Unless the Administrative Agent shall have received
notice from a Bank prior to the date of any Borrowing that such Bank will not
make available to the Administrative Agent such Bank's share of such Borrowing,
the Administrative Agent may assume that such Bank has made such share available
to the Administrative Agent on the date of such Borrowing in accordance with
subsection (b) of this Section 2.4 and the Administrative Agent may, in reliance
upon such assumption, but shall not be obligated to, make available to the
Borrower on such date a corresponding amount on behalf of such Bank. If and to
the extent that such Bank shall not have so made such share available to the
Administrative Agent, such Bank and the Borrower severally agree to
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repay to the Administrative Agent forthwith on demand, and in the case of the
Borrower two (2) Domestic Business Days after demand, such corresponding amount
together with interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid to the
Administrative Agent, at (i) in the case of the Borrower, a rate per annum equal
to the interest rate applicable thereto pursuant to Section 2.7 and (ii) in the
case of such Bank, the Federal Funds Rate. If such Bank shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall
constitute such Bank's Loan included in such Borrowing for purposes of this
Agreement.
SECTION 2.5. Notes.
(a) The Loans of each Bank shall be evidenced by such Bank's
Note.
(b) Reserved.
(c) Each Bank shall record the date, amount, type and
maturity of each Loan made by it and the date and amount of each payment of
principal made by the Borrower with respect thereto, and may, if such Bank so
elects in connection with any transfer or enforcement of its Note, endorse on
the appropriate schedule appropriate notations to evidence the foregoing
information with respect to each such Loan then outstanding; provided that the
failure of any Bank to make any such recordation or endorsement shall not affect
the obligations of the Borrower hereunder or under the Notes. Each Bank is
hereby irrevocably authorized by the Borrower so to endorse its Note and to
attach to and make a part of its Note a continuation of any such schedule as and
when required.
(d) The Committed Loans shall mature, and the principal
amount thereof shall be due and payable, on the Maturity Date.
(e) Reserved.
(f) There shall be no more than five (5) LIBOR Loans
outstanding at any one time.
SECTION 2.6. Method of Electing Interest Rates. (a) The Loans
included in each Committed Borrowing shall bear interest initially at the type
of rate specified by the Borrower in the applicable Notice of Borrowing.
Thereafter, the Borrower may from time to time elect to change or continue the
type of interest rate borne by each Loan (subject in each case to the provisions
of Article VIII), as follows:
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(i) if such Loans are Base Rate Loans, the Borrower
may elect to convert all or any portion of such Loans to LIBOR Loans as of any
LIBOR Business Day;
(ii) if such Loans are LIBOR Loans, the Borrower may
elect to convert all or any portion of such Loans to Base Rate Loans and/or
elect to continue all or any portion of such Loans as LIBOR Loans for an
additional Interest Period or additional Interest Periods, in each case
effective on the last day of the then current Interest Period applicable to such
Loans, or on such other date designated by Borrower in the Notice of Interest
Rate Election provided Borrower shall pay any losses pursuant to Section 2.13.
Each such election shall be made by delivering a notice in the
form of Exhibit "G" (a "Notice of Interest Rate Election") to the Administrative
Agent by 11:00 A.M. (San Francisco time) at least three (3) LIBOR Business Days
before the conversion or continuation selected in such notice is to be
effective. A Notice of Interest Rate Election may, if it so specifies, apply to
only a portion of the aggregate principal amount of the relevant Loans; provided
that (i) such portion is allocated ratably among such Loans, (ii) the portion to
which such Notice applies, and the remaining portion to which it does not apply,
are each $3,000,000 or any larger multiple of $100,000, (iii) there shall be no
more than five (5) LIBOR Loans outstanding at any time, (iv) no Committed Loan
may be continued as, or converted into, a LIBOR Loan when any Event of Default
has occurred and is continuing, and (v) no Interest Period shall extend beyond
the Maturity Date.
(b) Each Notice of Interest Rate Election shall specify:
(i) the Loans (or portion thereof) to which such
notice applies;
(ii) the date on which the conversion or continuation
selected in such notice is to be effective, which shall comply with the
applicable clause of subsection (a) above;
(iii) if the Loans are to be converted, the new type
of Loans and, if such new Loans are LIBOR Loans, the duration of the initial
Interest Period applicable thereto; and
(iv) if such Loans are to be continued as LIBOR Loans
for an additional Interest Period, the duration of such additional Interest
Period.
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Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election from
the Borrower pursuant to subsection (a) above, the Administrative Agent shall
notify each Bank the same day as it receives such Notice of Interest Rate
Election of the contents thereof and the Interest Periods (if different from
those requested by the Borrower) and such notice shall not thereafter be
revocable by the Borrower. If the Borrower fails to deliver a timely Notice of
Interest Rate Election to the Administrative Agent for any LIBOR Loans, such
Loans shall be converted into Base Rate Loans on the last day of the then
current Interest Period applicable thereto. Within one LIBOR Business Day after
receipt of a Notice of Interest Rate Election from the Borrower pursuant to
subsection (a) above, the Administrative Agent shall notify each Bank of the
interest rates determined pursuant thereto.
SECTION 2.7. Interest Rates.
(a) Each Base Rate Loan shall bear interest on the
outstanding principal amount thereof, for each day from the date such Loan is
made until the date it is repaid or converted into a LIBOR Loan pursuant to
Section 2.6 or at the Maturity Date, at a rate per annum, equal to the Base Rate
plus the Applicable Margin for Base Rate Loans for such day. Such interest shall
be payable for each Interest Period on the first day of each calendar month.
(b) Each LIBOR Loan shall bear interest on the outstanding
principal amount thereof, for each day during the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Applicable Margin for LIBOR
Loans for such day plus the Adjusted London Interbank Offered Rate applicable to
such Interest Period. Such interest shall be payable for each Interest Period on
the first day of each calendar month.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained (rounded
upward, if necessary, to the next higher 1/100 of 1%) by dividing (i) the London
Interbank Offered Rate applicable during such Interest Period by (ii) 1.00 minus
the LIBOR Reserve Percentage.
The "London Interbank Offered Rate" applicable to any Interest
Period means the respective per annum U.S. Dollar rates listed on page 3750
(i.e., the LIBOR page) of the Telerate News Services titled "British Banker
Association Interest Settlement Rates" (rounded upward, if necessary, to the
next highest 1/100 of 1%) determined at approximately 11:00 a.m. (London time)
two LIBOR Business Days before the first day
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of such Interest Period in an amount approximately equal to the principal amount
of the LIBOR Borrowing or Loans or portion thereof to be converted into or
continued as LIBOR Loans to which such Interest Period is to apply and for a
period of time comparable to such Interest Period. If the Telerate News Services
ceases to publish the "London Interbank Offered Rate", then such rate shall be
determined from such substitute financial reporting service as the
Administrative Agent in its reasonable discretion shall determine.
"LIBOR Reserve Percentage" means for any day that percentage
(expressed as a decimal) which is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) under
Regulation D, as Regulation D may be amended, modified or supplemented, for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities which includes deposits by reference to which the interest rate on
LIBOR Loans is determined or any category of extensions of credit or other
assets which includes loans by a non-United States office of any Bank to United
States residents). The Adjusted London Interbank Offered Rate shall be adjusted
automatically on and as of the effective date of any change in the LIBOR Reserve
Percentage.
(c) Reserved.
(d) In the event that, and for so long as, any Event of
Default shall have occurred and be continuing, the outstanding principal amount
of the Loans, and, to the extent permitted by applicable law, overdue interest
in respect of all Loans, shall bear interest at a rate per annum equal to the
sum of four percent (4%) plus the Base Rate (the "Default Rate").
(e) The Administrative Agent shall determine each interest
rate applicable to the Loans hereunder. The Administrative Agent shall give
prompt notice to the Borrower and the Banks of each rate of interest so
determined, and its determination thereof shall be conclusive in the absence of
demonstrable error.
SECTION 2.8. Reserved.
SECTION 2.9. Fees.
(a) Facility Fee. The Borrower shall pay to the
Administrative Agent for the account of the Banks ratably in proportion to their
respective Commitments a facility fee (the "Facility Fee") on the Aggregate
Commitment. The Facility Fee shall be
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payable in arrears in quarterly installments which shall be due on each January
1, April 1, July 1 and October 1 during the Term. The amount of each installment
(which shall be prorated by the Administrative Agent if due with respect to a
period which is less than a full quarter) shall be one quarter of the product of
(A) for the period commencing on the Effective Date and ending on June 30, 2000,
(i) 0.200% and (ii) the Aggregate Commitment , and (B) for the period commencing
on July 1, 2000, (i) 0.250% and (ii) the Aggregate Commitment.
(b) Other Fees. From the period commencing on the Effective
Date and ending on the Maturity Date, the Borrower shall pay to the
Administrative Agent, for the benefit of the Administrative Agent and
Documentation Agent, the fees specified in the letter agreement, dated as of the
same date as this Agreement, between Borrower and the Administrative Agent with
respect to fees.
(c) Fees Non-Refundable. All fees set forth in this Section
2.9 shall be deemed to have been earned on the earlier of when accrued or when
payable hereunder and shall be non-refundable. The obligation of the Borrower to
pay such fees in accordance with provisions hereof shall be binding upon the
Borrower and shall inure to the benefit of the Administrative Agent, and the
Documentation Agent, the Syndication Agent and the Banks regardless of whether
any Loans are actually made.
SECTION 2.10. Maturity Date.
The term (the "Term") of the Commitments (and each Bank's
obligations to make Loans hereunder) shall terminate and expire on the Maturity
Date. Upon the date of the termination of the Term, any Loans then outstanding
(together with accrued interest thereon and all other Obligations) shall be due
and payable on such date.
SECTION 2.11. Optional Prepayments.
(a) The Borrower may, upon at least one (1) Domestic
Business Day's notice to the Administrative Agent, prepay any Base Rate Loans,
in whole or in part at any time, or from time to time in part in amounts
aggregating Five Hundred Thousand Dollars ($500,000) or any larger multiple of
One Hundred Thousand Dollars ($100,000), by paying the principal amount thereof.
Each such optional prepayment shall be applied to prepay ratably the Loans of
the several Banks included in such Borrowing.
(b) The Borrower may, upon at least three (3) LIBOR Business
Days' notice to the Administrative Agent, prepay any LIBOR Loan as of the last
day of the Interest Period applicable thereto. Except as provided in Article
VIII and except with respect to any LIBOR Loan which has been converted to a
Base Rate Loan pursuant to
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Section 8.2, 8.3 or 8.4 hereof, the Borrower may not prepay all or any portion
of the principal amount of any LIBOR Loan prior to the end of the Interest
Period applicable thereto unless the Borrower shall also pay any applicable
expenses pursuant to Section 2.13. Each such optional prepayment shall be in the
amounts set forth in Section 2.11(a) above, except that any LIBOR Loan which has
been converted to a Base Rate Loan pursuant to Section 8.2, 8.3 or 8.4 hereof
may be prepaid without ratable payment of other Loans which have not been so
converted.
(c) The Borrower may at any time and from time to time
cancel all or any part of the Commitments by the delivery to the Administrative
Agent of a notice of cancellation within the applicable time periods set forth
in Sections 2.11(a) and (b) if there are Loans then outstanding or, if there are
no Loans outstanding at such time as to which the Commitments with respect
thereto are being canceled, upon at least one (1) Domestic Business Day's notice
to the Administrative Agent, whereupon, in either event, all or such portion of
the Commitments, as applicable, shall terminate as to the Banks, pro rata on the
date set forth in such notice of cancellation, and, if there are any Loans then
outstanding, Borrower shall prepay, as applicable, all or such portion of Loans
outstanding on such date in accordance with the requirements of Section 2.11(a)
and (b). Borrower shall be required to designate in its notice of cancellation
which Loans, if any, are to be prepaid.
(d) Any amounts so prepaid pursuant to Section 2.11(a) or
(b) may be reborrowed. In the event Borrower elects to cancel all or any portion
of the Commitments pursuant to Section 2.11(c) hereof, such amounts may not be
reborrowed.
SECTION 2.12. General Provisions as to Payments.
(a) The Borrower shall make each payment of interest and
principal on the Loans and of fees hereunder, not later than 10:00 A.M. (San
Francisco time) on the date when due, in Federal or other funds immediately
available in San Francisco, to the Administrative Agent at its address referred
to in Section 9.1. The Administrative Agent will promptly (and in any event
within one (1) Domestic Business Day after receipt thereof) distribute to each
Bank its ratable share of each such payment received by the Administrative Agent
for the account of the Banks. If and to the extent that the Administrative Agent
shall receive any such payment for the account of the Banks on or before 10:00
A.M. (San Francisco time) on any Domestic Business Day, and Administrative Agent
shall not have distributed to any Bank its applicable share of such payment on
such Domestic Business Day, Administrative Agent shall distribute such amount to
such Bank together with interest thereon, for each day from the date such amount
should have been distributed to such Bank until the date Administrative Agent
distributes such amount to such Bank, at the Federal Funds Rate. Whenever any
payment
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of principal of, or interest on the Base Rate Loans or of fees shall be due on a
day which is not a Domestic Business Day, the date for payment thereof shall be
extended to the next succeeding Domestic Business Day. Whenever any payment of
principal of, or interest on, the LIBOR Loans shall be due on a day which is not
a LIBOR Business Day, the date for payment thereof shall be extended to the next
succeeding LIBOR Business Day unless such LIBOR Business Day falls in another
calendar month, in which case the date for payment thereof shall be the next
preceding LIBOR Business Day. If the date for any payment of principal is
extended by operation of law or otherwise, interest thereon shall be payable for
such extended time.
(b) Unless the Administrative Agent shall have received
notice from the Borrower prior to the date on which any payment is due to the
Banks hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each Bank on such due
date an amount equal to the amount then due such Bank. If and to the extent that
the Borrower shall not have so made such payment, each Bank shall repay to the
Administrative Agent forthwith on demand such amount distributed to such Bank
together with interest thereon, for each day from the date such amount is
distributed to such Bank until the date such Bank repays such amount to the
Administrative Agent, at the Federal Funds Rate.
SECTION 2.13. Funding Losses. If the Borrower makes any payment
of principal with respect to any LIBOR Loan (pursuant to Article II, VI or VIII
or otherwise) on any day other than the last day of the Interest Period
applicable thereto, or if the Borrower fails to borrow any LIBOR Loans after
notice has been given to any Bank in accordance with Section 2.4(a), or if
Borrower shall deliver a Notice of Interest Rate Election specifying that a
LIBOR Loan shall be converted on a date other than the first (1st) day of the
then current Interest Period applicable thereto, the Borrower shall reimburse
each Bank within fifteen (15) days after certification of such Bank of such loss
or expense (which shall be delivered by each such Bank to Administrative Agent
for delivery to Borrower) for any resulting loss or expense incurred by it (or
by an existing Participant in the related Loan), including (without limitation)
any loss incurred in obtaining, liquidating or employing deposits from third
parties, but excluding loss of margin for the period after any such payment or
failure to borrow, provided that such Bank shall have delivered to
Administrative Agent and Administrative Agent shall have delivered to the
Borrower a certification as to the amount of such loss or expense, which
certification shall set forth in reasonable detail the basis for and calculation
of such loss or expense and shall be conclusive in the absence of demonstrable
error.
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SECTION 2.14. Computation of Interest and Fees. All interest and
fees shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the last
day).
SECTION 2.15. Use of Proceeds. The Borrower shall use the
proceeds of the Loans for general corporate purposes, including, without
limitation, the acquisition of multifamily apartment projects and real property
to be used in connection with construction, management, development, acquisition
and operation of multifamily apartment projects and for general working capital
needs of the Borrower.
SECTION 2.16. Letters of Credit.
(a) Subject to the terms and conditions set forth in this
Agreement, at any time and from time to time from the Effective Date through the
day that is five (5) days prior to the Maturity Date, the Administrative Agent
shall, as soon as reasonably practical, issue such Letters of Credit as the
Borrower may request by submitting to Administrative Agent a properly completed
and executed Request for Letter of Credit in the form attached hereto as Exhibit
K, provided that, (i) upon issuance of such Letters of Credit, the sum of all
outstanding Loans plus outstanding Letters of Credit shall not exceed the
Aggregate Commitment, (ii) the aggregate face amount of all outstanding Letters
of Credit shall not at any time exceed Fifty Million Dollars ($50,000,000) and
(iii) in no event shall Letters of Credit be issued for the benefit of any of
the Banks or for purposes of securing repayment of loans extended to the
Borrower or any Subsidiary thereof. Notwithstanding anything to the contrary
with respect to the foregoing sentence, it is not the intention thereof to
restrict the issuance of Letters of Credit in connection with bond indebtedness
and/or the enhancement thereof. No Letter of Credit shall have an expiration
date later than the earlier of (i) twelve (12) months after the date of the
issuance of such Letter of Credit or (ii) the Maturity Date. Letters of Credit
may contain automatic extension or renewal clauses, provided that any such
automatic extension or renewal shall be subject to the right of the
Administrative Agent to give written notice to the beneficiary under any such
Letter of Credit not less than thirty (30) days prior to the expiration date of
such Letter of Credit that Administrative Agent will not extend or renew such
Letter of Credit. As of the Effective Date, the Existing Letter of Credit shall
be a Letter of Credit for all purposes of this Agreement.
(b) Each Request for Letter of Credit shall be submitted to
the Administrative Agent, together with an L/C Agreement duly executed on behalf
of the Borrower by a Certifying Officer and addressed to the Administrative
Agent, not later than 9:00 a.m., California time, at least three (3) Domestic
Business Days prior to the date upon which the requested Letter of Credit is to
be issued. The Borrower shall further deliver to the Administrative Agent such
additional instruments and documents as
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the Administrative Agent may reasonably require, in conformity with the then
standard practices of its letter of credit department, in connection with the
issuance of such Letter of Credit; provided that in no event shall the Letter of
Credit Fee or Letter of Credit Margin be altered or increased other than
pursuant to an amendment of the Credit Agreement.
(c) The Administrative Agent shall, if it approves of the
proposed wording of the Letter of Credit as set forth in the Request for Letter
of Credit and L/C Agreement (which approval shall not be unreasonably withheld),
and subject to the satisfaction of the conditions set forth in this Agreement,
issue the Letter of Credit on or before 5:00 p.m., California time, on or before
the day three (3) Domestic Business Days following receipt of the documents last
due pursuant to Section 2.16(b). Upon issuance of a Letter of Credit, the
Administrative Agent shall promptly notify the Banks of the amount and terms of
such Letter of Credit. The Administrative Agent shall deliver copies of Letters
of Credit to the Banks promptly following issuance thereof, and shall notify the
Banks of payments, reimbursements, expirations, negotiations, transfers and
other activity with respect to outstanding Letters of Credit promptly following
receipt of the same.
(d) Upon the issuance of a Letter of Credit, each Bank shall
be deemed to have purchased a pro rata participation therein from the
Administrative Agent in an amount equal to that Bank's pro rata share of such
Letter of Credit.
(e) If and to the extent that any amounts are drawn upon any
Letters of Credit, the amounts so drawn shall, from the date of payment thereof
by the Administrative Agent, be considered Base Rate Loans for all purposes
hereunder.
(f) Promptly after payment by the Administrative Agent of
any amount drawn upon any Letter of Credit, the Administrative Agent shall,
without notice to or the consent of the Borrower, direct the Banks to remit
funds to the Administrative Agent pursuant to Section 2.4(b) of this Agreement,
pro rata in accordance with their respective pro rata shares, in an aggregate
amount equal to the amount so paid by the Administrative Agent. Such funds shall
be paid to the Administrative Agent to reimburse it for the payment made by it
under the Letter of Credit. The Administrative Agent shall give prompt written
notice to the Banks of any reduction in the amount available to be drawn under
any Letter of Credit and of any extension of the term of any Letter of Credit.
(g) On or before the Maturity Date or any earlier
termination of this Agreement, the Borrower shall provide to the Administrative
Agent a standby letter of credit issued by a bank or other financial institution
reasonably satisfactory to the Administrative Agent, in form and substance
reasonably satisfactory to the Administrative Agent, in favor of the
Administrative Agent, in a face amount equal to outstanding
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Letters of Credit issued for the account of the Borrower on that date, or shall
make other provisions satisfactory to the Administrative Agent for the full
collateralization, by Cash or Cash Equivalent, of such outstanding Letter of
Credit. In the event that Borrower makes a Cash or Cash Equivalent deposit
pursuant to the requirements of this Section 2.16(g), (i) Borrower's cash
deposit shall earn the rate of interest then currently paid by the
Administrative Agent on comparable deposits, taking into account the amount
deposited and the term of the deposit and (ii) promptly following the expiration
of the outstanding Letter of Credit for which the Cash or Cash Equivalent
deposit was made, Administrative Agent shall, to the extent the Letter of Credit
has not been drawn, return such deposit, together with any interest earned
thereon, to Borrower. In the event of failure of the Borrower to comply with the
requirements of this Section 2.16(g), such portion of the face amount of all
outstanding Letters of Credit as to which the Borrower has failed to comply
shall be deemed to be advanced and due and payable in accordance with the terms
hereof.
(h) The issuance of any supplement, modification, amendment,
renewal or extension to or of any Letter of Credit shall be treated in all
respects the same as the issuance of a new Letter of Credit.
(i) Borrower shall pay Administrative Agent, on written
demand, commissions and fees for amendments to the Letter of Credit, payments
under the Letter of Credit, extensions of the Letter of Credit, cancellation of
the Letter of Credit, and other services in the amounts Borrower and
Administrative Agent may agree, or, in the absence of such agreement, in the
amounts customarily charged by Administrative Agent to other similarly-rated
borrowers under corporate unsecured facilities similar to this Agreement, on the
date of Administrative Agent's demand.
(j) Upon the occurrence of any of the following events,
Borrower shall deposit with Administrative Agent, on written demand and as cash
security for Borrower's obligations to Administrative Agent under this
Agreement, an amount equal to the undrawn amount of the Letter of Credit:
(i) Any Event of Default occurs under this
Agreement; or
(ii) Any court order, injunction or other legal
process is issued restraining or seeking to restrain drawing or payment under
the Letter of Credit.
(k) Borrower authorizes Administrative Agent to charge any
of Borrower's accounts with Administrative Agent for all amounts then due and
payable to Administrative Agent under this Agreement.
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(l) Borrower shall pay, on written demand, all actual costs,
expenses and reasonable attorneys' fees (including allocated costs for in-house
legal services) incurred by Administrative Agent in connection with (a) any
dispute concerning the Letter of Credit or this Agreement or (b) the enforcement
of this Agreement.
(m) Subject to the laws, customs and practices of the trade
in the area where the beneficiary is located, the Letter of Credit will be
subject to, and performance under the Letter of Credit by Administrative Agent,
its correspondents, and the beneficiary will be governed by, the "Uniforms
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce, Publication No. 500," or by later Uniform Customs and
Practice fixed by later Congresses of the International Chamber of Commerce as
in effect on the date the Letter of Credit is issued.
ARTICLE III.
CONDITIONS
SECTION 3.1. Closing. The closing hereunder shall occur on the
date when each of the following conditions is satisfied (or waived by the
Administrative Agent and the Banks).
(a) The Merger Date shall have occurred and the
Administrative Agent shall have received such evidence of the occurrence of the
Merger Date as the Administrative Agent may reasonably require;
(b) the Borrower, the Administrative Agent and each of the
Banks shall have executed and delivered to the Borrower and the Administrative
Agent a duly executed original of this Agreement;
(c) TICALLC shall have executed and delivered to the
Administrative Agent the duly executed original of the Guaranty;
(d) the Administrative Agent shall have received an opinion
of O'Melveny & ▇▇▇▇▇, LLP, counsel for the Borrower, acceptable to the
Administrative Agent, and its counsel;
(e) Reserved;
(f) the Administrative Agent shall have received all
documents the Administrative Agent may reasonably request relating to the
existence of the Borrower and General Partner, the authority for and the
validity of this Agreement and the other
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Loan Documents, and any other matters relevant hereto, all in form and substance
satisfactory to the Administrative Agent. Such documentation shall include,
without limitation, the agreement of limited partnership of the Borrower, as
well as the certificate of limited partnership of the Borrower, both as amended,
modified or supplemented prior to the Closing Date, certified to be true,
correct and complete by a senior officer of the Borrower as of a date not more
than ten (10) days prior to the Closing Date, together with a long-form
certificate of good standing as to the Borrower from the Secretary of State (or
the equivalent thereof) of Delaware, a good standing certificate issued by the
Secretary of State of the State of California, each to be dated not more than
thirty (30) days prior to the Closing Date, as well as the certificate of
formation and limited liability company agreement of General Partner, as
amended, modified or supplemented prior to the Closing Date, certified to be
true, correct and complete by the managing member of General Partner as of a
date not more than ten (10) days prior to the Closing Date, together with a good
standing certificate as to General Partner from the Secretary of State (or the
equivalent thereof) of Delaware, to be dated not more than thirty (30) days
prior to the Closing Date;
(g) the Administrative Agent shall have received all
certificates, agreements and other documents and papers referred to in this
Section 3.1 and the Notice of Borrowing referred to in Section 3.2, if
applicable, unless otherwise specified, in sufficient counterparts, satisfactory
in form and substance to the Administrative Agent in its sole discretion;
(h) the Borrower shall have taken all actions required to
authorize the execution and delivery of this Agreement and the other Loan
Documents and the performance thereof by the Borrower;
(i) the Administrative Agent shall be satisfied that none of
the Borrower, General Partner nor any Consolidated Subsidiary is subject to any
present or contingent environmental liability which could have a Material
Adverse Effect;
(j) the Administrative Agent shall have received, for its
and any other Bank's account, all fees due and payable pursuant to Section 2.9
hereof on or before the Closing Date;
(k) the Administrative Agent shall have received copies of
all consents, licenses and approvals, if any, required in connection with the
execution, delivery and performance by the Borrower, General Partner and the
applicable Consolidated Subsidiaries, and the validity and enforceability, of
the Loan Documents, or in connection with any of the transactions contemplated
thereby, and such consents, licenses and approvals shall be in full force and
effect;
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(l) the Administrative Agent shall have received the audited
financial statements of the Borrower and its Consolidated Subsidiaries and of
IAC for the Fiscal Year ending December 31, 1998; and
(m) no Default or Event of Default shall have occurred.
SECTION 3.2. Borrowings. The obligation of any Bank to make a
Loan is subject to the satisfaction of the following conditions:
(a) the Closing Date shall have occurred on or prior to June
30, 1999;
(b) receipt by the Administrative Agent of a Notice of
Borrowing as required by Section 2.2, signed by (i) a Certifying Officer or (ii)
such other Person as may be designated in writing from time to time in a written
notice delivered to Administrative Agent which has been signed by a Certifying
Officer;
(c) immediately after such Borrowing, the aggregate
outstanding principal amount of the Loans together with the aggregate face
amount of all outstanding Letters of Credit, to the extent the Letters of Credit
have not been drawn, will not exceed the Aggregate Commitments;
(d) immediately before and after such Borrowing, no Default
or Event of Default shall have occurred and be continuing both before and after
giving effect to the making of such Loans;
(e) the representations and warranties of the Borrower
contained in this Agreement (other than representations and warranties which
expressly speak as of a different date) shall be true and correct in all
material respects on and as of the date of such Borrowing both before and after
giving effect to the making of such Loans;
(f) no law or regulation shall have been adopted, no order,
judgment or decree of any governmental authority shall have been issued, and no
litigation shall be pending, which does or seeks to enjoin, prohibit or
restrain, the making or repayment of the Loans or the consummation of the
transactions contemplated by this Agreement; and
(g) no event, act or condition shall have occurred after the
Closing Date which, in the reasonable judgment of the Super-Majority Banks has
had or is reasonably expected to have a Material Adverse Effect.
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Each Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Borrowing as to the facts specified in clauses
(c), (d), (e), (f), and (g) (to the extent that Borrower is or should have been
aware of any Material Adverse Effect) of this Section, except as otherwise
disclosed in writing by Borrower to the Banks.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
In order to induce the Administrative Agent and each of the
other Banks which is or may become a party to this Agreement to make the Loans,
the Borrower makes the following representations and warranties as of the
Closing Date. Such representations and warranties shall survive the
effectiveness of this Agreement, the execution and delivery of the other Loan
Documents and the making of the Loans.
SECTION 4.1. Existence and Power. The Borrower is a limited
partnership, duly formed and validly existing as a limited partnership under the
laws of the State of Delaware and has all powers and all material governmental
licenses, authorizations, consents and approvals required to own its property
and assets and carry on its business as now conducted or as it presently
proposes to conduct and has been duly qualified and is in good standing in the
State of California and in every other jurisdiction in which the failure to be
so qualified and/or in good standing is likely to have a Material Adverse
Effect. General Partner is a limited liability company, duly formed, validly
existing and in good standing as a limited liability company under the laws of
the State of Delaware and has all powers and all material governmental licenses,
authorizations, consents and approvals required to own its property and assets
and carry on its business as now conducted or as it presently proposes to
conduct and has been duly qualified and is in good standing in every
jurisdiction in which the failure to be so qualified and/or in good standing is
reasonably expected to have a Material Adverse Effect.
SECTION 4.2. Power and Authority. The Borrower has the
partnership power and authority to execute, deliver and carry out the terms and
provisions of each of the Loan Documents to which it is a party and has taken
all necessary partnership action, if any, to authorize the execution and
delivery on behalf of the Borrower and the performance by the Borrower of such
Loan Documents. The Borrower has duly executed and delivered each Loan Document
to which it is a party in accordance with the terms of this Agreement, and each
such Loan Document constitutes the legal, valid and binding obligation of the
Borrower, enforceable in accordance with its terms, except as enforceability may
be limited by applicable insolvency, bankruptcy or other laws affecting
creditors rights generally, or general principles of equity, whether such
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enforceability is considered in a proceeding in equity or at law. General
Partner has the power and authority to execute, deliver and carry out the terms
and provisions of each of the Loan Documents on behalf of the Borrower to which
the Borrower is a party and has taken all necessary action to authorize the
execution and delivery on behalf of the Borrower and the performance by the
Borrower of such Loan Documents.
SECTION 4.3. No Violation. Neither the execution, delivery or
performance by or on behalf of the Borrower of the Loan Documents to which it is
a party, nor compliance by the Borrower with the terms and provisions thereof
nor the consummation of the transactions contemplated by the Loan Documents, (i)
will contravene any applicable provision of any law, statute, rule, regulation,
order, writ, injunction or decree of any court or governmental instrumentality,
(ii) will conflict with or result in any breach of, any of the terms, covenants,
conditions or provisions of, or constitute a default under, or result in the
creation or imposition of (or the obligation to create or impose) any Lien upon
any of the property or assets of the Borrower or any of its Consolidated
Subsidiaries pursuant to the terms of any indenture, mortgage, deed of trust, or
other agreement or other instrument to which the Borrower (or of any partnership
of which the Borrower is a partner) or any of its Consolidated Subsidiaries is a
party or by which it or any of its property or assets is bound or to which it is
subject, or (iii) will cause a default by the Borrower under any organizational
document of any Person in which the Borrower has an interest, or cause a default
under the Borrower's agreement or certificate of limited partnership, the
consequences of any such contravention, conflict, breach or default described in
clauses (i), (ii) or (iii) is reasonably expected to have a Material Adverse
Effect, or result in or require the creation or imposition of any Lien
whatsoever upon any Property (except as contemplated herein).
SECTION 4.4. Financial Information.
(a) The consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries, dated as of December 31, 1998, and the related
consolidated statements of Borrower's financial position for the Fiscal Year
then ended, reported on by Ernst & Young LLP, a copy of which has been delivered
to each of the Banks, fairly present, in conformity with GAAP, the consolidated
financial position of the Borrower and its Consolidated Subsidiaries as of such
date and their consolidated results of operations and cash flows for such Fiscal
Year.
(b) Reserved.
(c) Reserved.
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(d) Since December 31, 1998, (i) except as may have been
disclosed in writing to the Banks, nothing has occurred having a Material
Adverse Effect, and (ii) except as previously disclosed to the Banks, neither
the Borrower nor General Partner has incurred any material indebtedness or
guaranty on or before the Closing Date.
SECTION 4.5. Litigation. Except as previously disclosed by the
Borrower in writing to the Banks, there is no action, suit or proceeding pending
against, or to the knowledge of the Borrower threatened against or affecting,
(i) the Borrower, General Partner or any of their Consolidated Subsidiaries,
(ii) the Loan Documents or any of the transactions contemplated by the Loan
Documents or (iii) any of their assets, before any court or arbitrator or any
governmental body, agency or official in which there is a reasonable possibility
of an adverse decision which actions, suits or proceedings described in clauses
(i), (ii) or (iii) would, individually, or in the aggregate have a Material
Adverse Effect or which in any manner draws into question the validity of this
Agreement or the other Loan Documents.
SECTION 4.6. Compliance with ERISA.
(a) Except as set forth on Schedule 4.6 attached hereto,
neither Borrower nor General Partner is a member of any Plan or Multiemployer
Plan or any other Benefit Arrangement.
(b) The transactions contemplated by the Loan Documents will
not constitute a nonexempt prohibited transaction (as such term is defined in
Section 4975 of the Code or Section 406 of ERISA) which would, individually or
in the aggregate, have a Material Adverse Effect on Borrower or that could
subject the Administrative Agent or the Banks to any tax or penalty or
prohibited transactions imposed under Section 4975 of the Code or Section 502(i)
of ERISA.
SECTION 4.7. Environmental Matters. The Borrower conducts
reviews of the effect of Environmental Laws on the business, operations and
properties of the Borrower and its Consolidated Subsidiaries when necessary in
the course of which it identifies and evaluates associated liabilities and costs
(including, without limitation, any capital or operating expenditures required
for clean-up or closure of properties presently owned, any capital or operating
expenditures required to achieve or maintain compliance with environmental
protection standards imposed by law or as a condition of any license, permit or
contract, any related constraints on operating activities, and any actual or
potential liabilities to third parties, including employees, and any related
costs and expenses). On the basis of this review, the Borrower has reasonably
concluded that no such associated liabilities and costs, including the costs of
compliance with Environmental Laws, (i) are, as of the date hereof, Significant
Environmental Costs, or
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(ii) would have a Material Adverse Effect on the Borrower, General Partner and
their Consolidated Subsidiaries.
SECTION 4.8. Taxes. United States Federal income tax returns of
the Borrower, General Partner and their Consolidated Subsidiaries have been
prepared and filed through the Fiscal Year ended December 31, 1998. The
Borrower, General Partner and their Consolidated Subsidiaries have filed all
United States Federal income tax returns and all other material tax returns
which are required to be filed by them and have paid all taxes due pursuant to
such returns or pursuant to any assessment received by the Borrower, General
Partner or any Consolidated Subsidiary, except such taxes, if any, as are
reserved against in accordance with GAAP, such taxes as are being contested in
good faith by appropriate proceedings or such taxes, the failure to make payment
of which when due and payable will not have, in the aggregate, a Material
Adverse Effect. The charges, accruals and reserves on the books of the Borrower,
General Partner and their Consolidated Subsidiaries in respect of taxes or other
governmental charges are, in the opinion of the Borrower, adequate.
SECTION 4.9. Full Disclosure. All factual information heretofore
prepared by the Borrower and furnished by the Borrower to the Administrative
Agent or any Bank for purposes of or in connection with this Agreement or any
transaction contemplated hereby or thereby is true and accurate in all material
respects as of the date as of which such information is stated or certified.
There is no fact known to the Borrower (other than matters of a general economic
nature) that has had or could reasonably be expected to have a Material Adverse
Effect and that has not been disclosed herein or in such other documents,
certificates or statements executed or delivered in connection herewith.
SECTION 4.10. Solvency. On the Closing Date and after giving
effect to the transactions contemplated by the Loan Documents occurring on the
Closing Date, the Borrower will be Solvent.
SECTION 4.11. Use of Proceeds; Margin Regulations. All proceeds
of the Loans will be used by the Borrower only in accordance with the provisions
hereof. No part of the proceeds of any Loan will be used by the Borrower to
purchase or carry any Margin Stock or to extend credit to others for the purpose
of purchasing or carrying any Margin Stock. Neither the making of any Loan nor
the use of the proceeds thereof will violate or be inconsistent with the
provisions of Regulations T, U or X of the Federal Reserve Board.
SECTION 4.12. Governmental Approvals. No order, consent,
approval, license, authorization, or validation of, or filing, recording or
registration with, or
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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 any Loan Document or the consummation of
any of the transactions contemplated thereby other than those that have already
been duly made or obtained and remain in full force and effect or those which,
if not made or obtained, would not have a Material Adverse Effect.
SECTION 4.13. Investment Company Act; Public Utility Holding
Company Act. Neither the Borrower, General Partner nor any Consolidated
Subsidiary is (x) an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended, (y) a "holding company" or a subsidiary company" of a "holding
company" or an "affiliate" of either a "holding company" or a "subsidiary
company" within the meaning of the Public Utility Holding Company Act of 1935,
as amended, or (z) subject to any other federal or state law or regulation which
purports to restrict or regulate its ability to borrow money.
SECTION 4.14. Principal Offices. As of the Closing Date, the
principal office, chief executive office and principal place of business of the
Borrower is ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
SECTION 4.15. Reserved.
SECTION 4.16. Patents, Trademarks, etc. The Borrower has
obtained and holds in full force and effect all patents, trademarks,
servicemarks, trade names, copyrights and other such rights, free from
burdensome restrictions, which are necessary for the operation of its business
as presently conducted, the impairment of which is reasonably expected to have a
Material Adverse Effect.
SECTION 4.17. Qualifying Unencumbered Properties. Schedule 4.17
attached hereto and made a part hereof sets forth all the Qualifying
Unencumbered Property owned by the Borrower, directly or indirectly, as of the
Closing Date. As of the Closing Date, all of the Properties set forth in
Schedule 4.17 are Qualifying Unencumbered Properties.
Borrower represents and warrants that, as of the Closing Date,
the Borrower has good and insurable fee title to the Qualifying Unencumbered
Property, free of all Liens other than Permitted Liens and that to its best
knowledge, except as disclosed in writing to the Administrative Agent in
connection with the extension of credit contemplated hereby or hereafter
disclosed in writing to the Administrative Agent from time to time, no Materials
of Environmental Concern are located on, under, over or about such real
property.
SECTION 4.18. No Default. As of the date hereof, no Event of
Default or Default exists under or with respect to any Indebtedness of the
Borrower and the Borrower
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is not in default in any material respect beyond any applicable grace period
under or with respect to any other material agreement, instrument or undertaking
to which it is a party or by which it or any of its property is bound in any
respect in any such case, the existence of which default is reasonably expected
to result in a Material Adverse Effect.
SECTION 4.19. Licenses, etc. The Borrower has obtained and does
hold in full force and effect, all franchises, licenses, permits, certificates,
authorizations, qualifications, accreditation, easements, rights of way and
other consents and approvals which are necessary for the operation of its
businesses as presently conducted, the absence of which is reasonably expected
to have a Material Adverse Effect.
SECTION 4.20. Compliance With Law. The Borrower and each of the
Real Property Assets are in compliance with all laws, rules, regulations,
orders, judgments, writs and decrees, including, without limitation, all
building and zoning ordinances and codes, the failure to comply with which is
reasonably expected to have a Material Adverse Effect.
SECTION 4.21. No Burdensome Restrictions. Except as may have
been disclosed by the Borrower in writing to the Banks, Borrower is not a party
to any agreement or instrument or subject to any other obligation or any charter
or corporate or partnership restriction, as the case may be, which, individually
or in the aggregate, is reasonably expected to have a Material Adverse Effect.
SECTION 4.22. Brokers' Fees. The Borrower has not dealt with any
broker or finder with respect to the transactions contemplated by this Agreement
or otherwise in connection with this Agreement, and the Borrower has not done
any act, had any negotiations or conversation, or made any agreements or
promises which will in any way create or give rise to any obligation or
liability for the payment by the Borrower of any brokerage fee, charge,
commission or other compensation to any party with respect to the transactions
contemplated by the Loan Documents, other than the fees payable to the
Administrative Agent, the Documentation Agent and the Banks, and certain other
Persons as previously disclosed in writing to the Administrative Agent.
SECTION 4.23. Labor Matters. As of the date hereof, there are no
collective bargaining agreements or Multiemployer Plans covering the employees
of the Borrower. As of the date hereof, the Borrower is not suffering any
strikes, walkouts, work stoppages or other material labor difficulty which are
reasonably expected to result in a Material Adverse Effect.
SECTION 4.24. Insurance. The Borrower currently maintains 100%
replacement cost insurance coverage (subject to customary deductibles) in
respect of each of the Real Property Assets, as well as commercial general
liability insurance (including
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"builders' risk" where applicable) against claims for personal, and bodily
injury and/or death, to one or more persons, or property damage, as well as
workers' compensation insurance, in each case with respect to liability and
casualty insurance with insurers having an A.M. Best policyholders, rating of
not less than A-VII (or such lesser rating satisfactory to Administrative Agent
in its reasonable discretion) in amounts that prudent owner of assets such as
the Real Property Assets would maintain.
SECTION 4.25. Organizational Documents. The documents delivered
pursuant to Section 3.1(f) constitute, as of the Closing Date, all of the
material organizational documents (together with all amendments and
modifications thereof) of the Borrower and General Partner. The Borrower
represents that it has delivered to the Administrative Agent true, correct and
complete copies of each of the documents set forth in Section 3.1(f).
SECTION 4.26. Year 2000 Compliance. The Borrower and General
Partner have each conducted a comprehensive review and assessment of the
Borrower's and General Partner's computer applications and made inquiry of the
Borrower's and General Partner's key suppliers, vendors and customers with
respect to the "year 2000 problem" (that is the risk that computer applications
may not be able to properly perform date-sensitive functions after December 31,
1999) and, based on that review and inquiry, neither the Borrower nor General
Partner believes the year 2000 problem will result in a material adverse change
in the Borrower's or General Partner's ability to repay the Loans.
ARTICLE V.
AFFIRMATIVE AND NEGATIVE COVENANTS
The Borrower covenants and agrees that, so long as any Bank has
any Commitment hereunder or any Obligations remain unpaid:
SECTION 5.1. Financial Information. The Borrower will deliver to
Administrative Agent (with sufficient copies to distribute to all of the Banks):
(a) as soon as available, but in no event later than
ninety-five (95) days after the end of each Fiscal Year of the Borrower, an
audited consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of the end of such Fiscal Year and the related consolidated
statements of Borrower's operations and consolidated statements of Borrower's
cash flow for such Fiscal Year, setting forth in each case in comparative form
the figures for the previous Fiscal Year, all reported on by Ernst & Young LLP
or other independent public accountants of nationally recognized standing;
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(b) as soon as available, but in no event later than sixty
(60) days after the end of each of the first three Fiscal Quarters of the
Borrower, (i) a consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as of the end of such quarter and the related consolidated
statements of Borrower's operations and consolidated statements of Borrower's
cash flow for such Fiscal Quarter and for the portion of the Borrower's Fiscal
Year ended at the end of such Fiscal Quarter, all reported on by Ernst & Young
LLP or other independent public accountants of nationally recognized standing,
and (ii) and such other information reasonably requested by the Administrative
Agent or any Bank;
(c) forty-five (45) days after the end of each Fiscal
Quarter, a certificate of the chief financial officer or the chief accounting
officer of the Borrower or its general partner (the "Certifying Officer") (i)
setting forth in reasonable detail the calculations required to establish
whether the Borrower was in compliance with the requirements of Section 5.9 on
the date of such financial statements; (ii) certifying (x) that such financial
statements fairly present the financial condition and the results of operations
of the Borrower on the dates and for the periods indicated, on the basis of
GAAP, with respect to the Borrower subject, in the case of interim financial
statements, to normally recurring year-end adjustments, and (y) that such
officer has reviewed the terms of the Loan Documents and has made, or caused to
be made under his or her supervision, a review in reasonable detail of the
business and condition of the Borrower during the period beginning on the date
through which the last such review was made pursuant to this Section 5.1(c) (or,
in the case of the first certification pursuant to this Section 5.1(c), the
Closing Date) and ending on a date not more than ten (10) Domestic Business Days
prior to the date of such delivery and that (1) on the basis of such financial
statements and such review of the Loan Documents, no Event of Default existed
under Section 6.1(b) with respect to Sections 5.9 and 5.10 at or as of the date
of said financial statements, and (2) on the basis of such review of the Loan
Documents and the business and condition of the Borrower, to the best knowledge
of such officer, as of the last day of the period covered by such certificate no
Default or Event of Default under any other provision of Section 6.1 occurred
and is continuing or, if any such Default or Event of Default has occurred and
is continuing, specifying the nature and extent thereof and, the action the
Borrower proposes to take in respect thereof. Such certificate shall set forth
the calculations required to establish the matters described in clause (1) above
and shall attach as exhibits thereto the following: escrow closing statements,
certified by the Certifying Officer, for each Qualifying Unencumbered Property
which was acquired during the preceding Fiscal Quarter; an occupancy report
setting forth the average Occupancy Rate for each Qualifying Unencumbered
Property during the preceding Fiscal Quarter; and a report stating the Net
Operating Income for each Qualifying Unencumbered Property during the preceding
Fiscal Quarter with reasonable detail as to all property expenses and capital
expenditures.
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(d) not less frequently than annually, and in any event
within fifteen (15) days after adoption by Borrower's Board of Directors, the
Borrower's business plan, any subsequent material revisions thereto, and a
statement of projected cash flow of the Borrower and its Consolidated
Subsidiaries for the twelve (12) month period following the date of such
Business Plan.
SECTION 5.2. Other Information. The Borrower will deliver to the
Administrative Agent (with sufficient copies to distribute to all of the Banks):
(a) (i) within five (5) Domestic Business Days after any
executive officer of the Borrower or its general partner obtains knowledge of
any Default, if such Default is then continuing, a certificate of a Certifying
Officer, or other executive officer of the Borrower or its general partner
setting forth the details thereof and the action which the Borrower is taking or
proposes to take with respect thereto; and (ii) promptly and in any event within
five (5) Domestic Business Days after an executive officer of the Borrower or
its general partner obtains knowledge thereof, notice of (y) any litigation or
governmental proceeding pending or threatened against the Borrower or the Real
Property Assets as to which there is a reasonable possibility of an adverse
determination and which, if adversely determined, would individually or in the
aggregate, result in a Material Adverse Effect and (z) any other event, act or
condition which is reasonably expected to result in a Material Adverse Effect;
(b) Reserved.
(c) Reserved.
(d) promptly and in any event within thirty (30) days after
any member of the ERISA Group (i) gives or is required to give notice to the
PBGC of any "reportable event" (as defined in Section 4043 of ERISA) with
respect to any Plan which might constitute grounds for a termination of such
Plan under Title IV of ERISA, or knows that the plan administrator of any Plan
has given or is required to give notice of any such reportable event, a copy of
the notice of such reportable event given or required to be given to the PBGC;
(ii) receives notice of complete or partial withdrawal liability under Title IV
of ERISA or notice that any Multiemployer Plan is in reorganization, is
insolvent or has been terminated, a copy of such notice; (iii) receives notice
from the PBGC under Title IV of ERISA of an intent to terminate, impose
liability (other than for premiums under Section 4007 of ERISA) in respect of,
or appoint a trustee to administer any Plan, a copy of such notice; (iv) applies
for a waiver of the minimum funding standard under Section 412 of the Code, a
copy of such application; (v) gives notice of intent to terminate any Plan under
Section 4041(c) of ERISA, a copy of such notice and other information filed with
the PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063
of ERISA, a
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copy of such notice; or (vii) fails to make any payment or contribution to any
Plan or Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security, and in
the case of clauses (i) through (vii) above, which event could result in a
Material Adverse Effect, a certificate of the chief financial officer or the
chief accounting officer of the Borrower setting forth details as to such
occurrence and action, if any, which the Borrower or applicable member of the
ERISA Group is required or proposes to take;
(e) promptly and in any event within ten (10) days after an
executive officer of the Borrower or its general partner obtains actual
knowledge of any of the following events, a certificate of the Borrower,
executed by a Certifying Officer of the Borrower or its general partner,
specifying the nature of such condition, and the Borrower's or, if the Borrower
has actual knowledge thereof, the Environmental Affiliate's proposed initial
response thereto: (i) the receipt by an executive officer of the Borrower or its
general partner, or, if the Borrower has actual knowledge thereof, any of the
Environmental Affiliates of any communication (written or oral), whether from a
governmental authority, citizens group, employee or otherwise, that alleges that
the Borrower, or, if the Borrower has actual knowledge thereof, any of the
Environmental Affiliates, is not in compliance with applicable Environmental
Laws, and such noncompliance is reasonably expected to have a Material Adverse
Effect, (ii) the Borrower shall obtain actual knowledge that there exists any
Environmental Claim pending against the Borrower or any Environmental Affiliate
and such Environmental Claim is reasonably expected to have a Material Adverse
Effect or is reasonably expected to involve an expenditure of Significant
Environmental Cost or (iii) the Borrower obtains actual knowledge of any
release, emission, discharge or disposal of any Material of Environmental
Concern that is likely to form the basis of any Environmental Claim against the
Borrower or any Environmental Affiliate which in any such event is likely to
have a Material Adverse Effect or is reasonably expected to involve an
expenditure of Significant Environmental Cost;
(f) promptly and in any event within five (5) Domestic
Business Days after receipt of any material notices or correspondence from any
company or agent for any company providing insurance coverage to the Borrower
relating to any loss which is reasonably expected to result in a Material
Adverse Effect, copies of such notices and correspondence;
(g) promptly and in any event within five (5) days after an
executive officer of the Borrower or its general partner obtains actual
knowledge of a change in the Credit Rating, a certificate of the Borrower,
executed by a Certifying Officer of the Borrower or its general partner,
specifying the new Credit Rating, and
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(h) from time to time such additional information regarding
the financial position or business of the Borrower, General Partner and their
Subsidiaries as the Administrative Agent, at the request of any Bank, may
reasonably request in writing.
SECTION 5.3. Payment of Obligations. The Borrower, General
Partner and their Consolidated Subsidiaries will pay and discharge, at or before
maturity, all its respective material obligations and liabilities including,
without limitation, Taxes and any obligation pursuant to any agreement by which
it or any of its properties is bound, in each case where the failure to so pay
or discharge such obligations or liabilities is reasonably expected to result in
a Material Adverse Effect, and will maintain in accordance with GAAP,
appropriate reserves for the accrual of any of the same.
SECTION 5.4. Maintenance of Property; Insurance; Leases.
(a) The Borrower will keep, and will cause each Consolidated
Subsidiary to keep, all property useful and necessary in its business, including
without limitation the Real Property Assets (for so long as it constitutes Real
Property Assets), in good repair, working order and condition, ordinary wear and
tear excepted, in each case where the failure to so maintain and repair will
have a Material Adverse Effect.
(b) The Borrower shall maintain, or cause to be maintained,
insurance comparable to that described in Section 4.24 hereof with insurers
meeting the qualifications described therein, which insurance shall in any event
not provide for less coverage than insurance customarily carried by owners of
properties similar to, and in the same locations as, the Real Property Assets.
The Borrower will deliver to the Administrative Agent (i) upon the reasonable
request of the Administrative Agent from time to time full information as to the
insurance carried, and (ii) forthwith, notice of any cancellation or nonrenewal
of coverage by any insurer of the Borrower (other than any cancellation or
non-renewal due to Borrower's placement of replacement coverage with new
insurers meeting the requirements of this Section 5.4(b)).
SECTION 5.5. Conduct of Business and Maintenance of Existence.
The Borrower and General Partner will continue to engage in business of the same
general type as now conducted by the Borrower and General Partner and each will
preserve, renew and keep in full force and effect, its partnership and limited
liability company existence and its respective rights, privileges and franchises
necessary for the normal conduct of business unless the failure to maintain such
rights and franchises does not have a Material Adverse Effect.
SECTION 5.6. Compliance with Laws. The Borrower will and will
cause its Subsidiaries to comply in all material respects with all applicable
laws, ordinances, rules,
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regulations, and requirements of governmental authorities (including, without
limitation, Environmental Laws, and all zoning and building codes with respect
to the Real Property Assets and ERISA and the rules and regulations thereunder
and all federal securities laws) except where the necessity of compliance
therewith is contested in good faith by appropriate proceedings or where the
failure to do so will not have a Material Adverse Effect or expose
Administrative Agent or Banks to any material liability therefor.
SECTION 5.7. Inspection of Property, Books and Records. The
Borrower (i) will keep proper books of record and account in which full, true
and correct entries shall be made of all dealings and transactions in relation
to its business and activities in conformity with GAAP, modified as required by
this Agreement and applicable law; (ii) will permit representatives of any Bank
at such Bank's expense to visit any of its properties, including without
limitation the Real Property Assets, without notice; provided that the Bank
shall not unreasonably interfere with the operation of such properties or any
tenants thereon and such visitation shall occur within normal business hours;
(iii) will permit the representatives of any Bank, at such Bank's expense, to
inspect its properties, examine and make abstracts from any of its books and
records and to discuss its affairs, finances and accounts with its executive
officers, property managers and independent public accountants, in each such
case under this subclause (iii) all at such reasonable times during normal
business hours, upon reasonable prior notice and as often as may reasonably be
desired. Administrative Agent shall coordinate any such visit or inspection to
arrange for review by any Bank requesting any such visit or inspection.
SECTION 5.8. Existence. The Borrower shall do or cause to be
done, all things necessary to preserve and keep in full force and effect its,
General Partner's and their Consolidated Subsidiaries' existence and its
patents, trademarks, servicemarks, tradenames, copyrights, franchises, licenses,
permits, certificates, authorizations, qualifications, accreditation, easements,
rights of way and other rights, consents and approvals the nonexistence of which
is reasonably expected to have a Material Adverse Effect.
SECTION 5.9. Financial Covenants.
(a) Total Liabilities to Gross Asset Value. Borrower shall
not permit the ratio of Total Liabilities to Gross Asset Value of Borrower and
its Subsidiaries to exceed 0.55:1 at any time.
(b) Secured Debt to Gross Asset Value. Borrower shall not
permit the ratio of Secured Debt to Gross Asset Value of Borrower and its
Subsidiaries to exceed 0.45:1 at any time.
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(c) Unencumbered Pool. Borrower shall not permit the ratio
of the Unencumbered Asset Pool Value to outstanding Unsecured Debt to be less
than 1.75:1 at any time.
(d) EBITDA to Fixed Charges Ratio. Borrower shall not permit
the ratio of EBITDA for the then most recently completed Fiscal Quarter to Fixed
Charges for the then most recently completed Fiscal Quarter to be less than
1.75:1.
(e) Interest Coverage Ratio. Borrower shall not permit the
ratio of EBITDA for the then most recently completed Fiscal Quarter to Interest
Expense for the then most recently completed Fiscal Quarter to be less than
2.25:l.
(f) Reserved.
(g) Minimum Consolidated Tangible Net Worth. The
Consolidated Tangible Net Worth of the Borrower and its Consolidated
Subsidiaries will at no time be less than $200,000,000 plus ninety percent (90%)
of all Net Offering Proceeds received by General Partner (or General Partner's
predecessor in interest) or Borrower after December 31, 1996.
SECTION 5.10. Restriction on Fundamental Changes.
(a) Neither the Borrower, the General Partner nor any
Consolidated Subsidiary shall directly or indirectly enter into any merger or
consolidation without the prior written consent of the Required Banks which
consent may be withheld in its respective sole and absolute discretion unless
(i) (A) the entity with which or into which the Borrower or General Partner is
merged is TIC or a wholly-owned (directly or indirectly) subsidiary of TIC or
(B) the Borrower or the General Partner is the surviving entity, (ii) the entity
which is merged into the Borrower or the General Partner is not engaged in any
substantial business other than the management, development, ownership or
operation of multifamily residential apartment communities, and (iii) the gross
fair market value of the assets of the entity which is merged into the Borrower
or the General Partner is not in excess of ten percent (10%) of Borrower's
aggregate Gross Asset Value immediately prior to such merger or consolidation.
Neither the Borrower, the General Partner, nor any Consolidated Subsidiary shall
directly or indirectly enter into any reorganization or recapitalization,
reclassify its Capital Stock, liquidate, wind up or dissolve or sell, lease,
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or substantially all of its or their business or assets,
whether now owned or hereafter acquired. Nothing in this Section shall be deemed
to prohibit the sale or leasing of portions of the Real Property Assets in the
ordinary course of business.
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(b) The Borrower shall not amend its agreement of limited
partnership or other organizational documents in any manner that would have a
Material Adverse Effect. General Partner shall not amend its certificate of
formation, limited liability company agreement, or other organizational
documents in any manner that would have a Material Adverse Effect.
(c) The Borrower shall deliver to Administrative Agent
copies of all amendments to its agreement of limited partnership or to General
Partner's certificate of formation, limited liability company agreement or other
organizational documents (other than amendments solely reflecting changes in
ownership interests occurring in the ordinary course of business) no less than
ten (10) Domestic Business Days after the effective date of any such amendment.
(d) The Banks hereby approve the Merger and the replacement
of IAC by TICALLC as the general partner of Borrower.
SECTION 5.11. Changes in Business.
(a) The Borrower shall carry on its business operations
through the Borrower and its Subsidiaries.
(b) All or substantially all of Borrower's assets shall be
multifamily residential properties, unimproved land held for the development of
multifamily residential property, or equity interests in companies whose primary
business is the ownership, operation, development or management of multifamily
residential property. Borrower shall not engage in any line of business other
than ownership, operation and development of multifamily residential property
and the provision of services incidental thereto, whether directly or through
its Subsidiaries and Investment Affiliates.
SECTION 5.12. Margin Stock. None of the proceeds of the Loan
will be used, directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of buying or carrying any Margin Stock.
SECTION 5.13. Hedging Requirements. Within five (5) Domestic
Business Days after the last day of each calendar quarter, commencing March 31,
1998 the Borrower shall have in effect "Interest Rate ▇▇▇▇▇▇" on Borrower's
Indebtedness so that such Indebtedness, together with all Fixed Rate
Indebtedness of Borrower, shall constitute at least fifty percent (50%) of the
then aggregate Indebtedness of the Borrower. "Interest Rate ▇▇▇▇▇▇" shall mean
interest rate exchange, collar, cap, swap, adjustable strike cap, adjustable
strike corridor or similar agreements, each of which (i) shall have a minimum
term of two (2) years, or, in the case of loans pursuant to which interest shall
accrue at a
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rate other than a fixed rate, a term equal to the term of such floating rate
loan (to the extent the term of such floating rate loan is less than two (2)
years), (ii) shall have the effect of capping the interest rates covered thereby
at a rate equal to or lower than the Cap Rate at the time of purchase or
execution, and (iii) shall be with an Approved Financial Institution as the
counterparty. It is acknowledged and agreed that the Borrower shall have no
obligation to replace any Interest Rate Hedge even if the counterparty thereto
shall cease to be an Approved Financial Institution. The Borrower shall certify
its compliance with Interest Rate ▇▇▇▇▇▇ to the Administrative Agent in the
certificate required to be delivered by the Borrower pursuant to Section 5.1(c).
SECTION 5.14. General Partner Status.
(a) Status. TICALLC shall at all times (i) maintain its
status as a wholly-owned (directly or through one or more subsidiaries)
subsidiary of TIC, and (ii) engage in no business other than functioning as the
general partner of Borrower.
(b) Indebtedness. General Partner shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly, create, incur, assume
or otherwise become or remain directly or indirectly liable with respect to, any
Indebtedness, except:
(1) The Obligations; and
(2) Indebtedness which, after giving effect thereto, may be
incurred or may remain outstanding without giving rise to an Event of
Default or Default under any provision of this Article V.
(c) Restriction on Fundamental Changes.
(1) General Partner shall not have an Investment in any
Person other than Borrower and the interests identified on Schedule
5.14(c)(1) as being owned by General Partner.
(2) General Partner shall not acquire an interest in any
Property other than Securities issued by Borrower and the interests
identified on Schedule 5.14(c)(2).
(d) Disposal of Partnership Interests. General Partner shall
not directly or indirectly convey, sell, transfer, assign, pledge or otherwise
encumber or dispose of any of its partnership interests in Borrower.
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(e) General Partner shall have the right to change its name
provided that it shall give Administrative Agent not less than 15 days prior
written notice before any such name change becomes effective.
SECTION 5.15. Environmental Matters.
(a) Promptly upon the discovery of any Environmental Claim
or of any violation or alleged violation of Environmental Laws with respect to
any Qualifying Unencumbered Asset, the Borrower shall attempt in good faith, as
soon as practicable, to determine all costs it reasonably expects any party to
expend in connection with the investigation and resolution of such Environmental
Claim or of such violation or alleged violation of Environmental Laws. The
Borrower shall thereupon notify the Administrative Agent in writing of the
Borrower's reasonable, good faith estimate of the cost to investigate and
resolve such Environmental Claim or such violation or alleged violation if such
cost is equal to or greater than $250,000. Such good faith estimate of such
costs, as revised from time to time pursuant hereto, shall be deemed to be the
"Estimated Environmental Cost" of such Environmental Claim or such violation or
alleged violation of Environmental Laws. After the end of each Fiscal Quarter,
the Borrower shall review and update all Estimated Environmental Costs and shall
deliver, with the Borrower's quarterly reports delivered in accordance with
Section 5.1 hereof, a written report to the Administrative Agent, setting forth,
in reasonable detail, each Estimated Environmental Cost which is in excess of
$250,000, the basis for the determination of such Estimated Environmental Cost,
and the Borrower's plans with respect to such Environmental Claim or such
violation or alleged violation of Environmental Laws. If the Borrower at any
time is not diligently and in good faith pursuing a determination of or an
update of a Estimated Environmental Cost which exceeds $250,000, the
Administrative Agent may, in reliance upon the opinions and judgments of
environmental consultants (either independent or employed by the Administrative
Agent), estimate or update, in good faith, the cost to investigate and resolve
an Environmental Claim or alleged or actual violation of Environmental Laws. In
the event that the Administrative Agent makes any such determination, the
Estimated Environmental Cost of investigating and resolving such Environmental
Claim or such alleged or actual violation of Environmental Laws shall be the
Administrative Agent's estimate, until such time as Borrower again diligently
pursues in good faith the determination or update of Estimated Environmental
Cost, and upon Borrower's determination of a Estimated Environmental Cost in
compliance herewith the Estimated Environmental Cost shall thereafter be
Borrower's estimate thereof, as set forth herein.
(b) The Borrower shall, at all times, diligently and in good
faith pursue resolution of all Environmental Claims, and all violations or
alleged violations of Environmental Laws, with respect to its Properties.
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SECTION 5.16. Cooperation. The Borrower shall take any action
reasonably requested by the Administrative Agent to carry out the intent of the
Loan Documents.
SECTION 5.17. Distributions. Unless waived by the Required
Banks, no Borrower Party shall make any Restricted Payments after the occurrence
of and during the continuation of an Event of Default under Section 6.1(a),
other than Restricted Payments with respect to the Series A Preferred Securities
and the Series B Preferred Securities.
ARTICLE VI.
DEFAULTS
SECTION 6.1. Events of Default. If one or more of the following
events ("Events of Default") shall have occurred and be continuing:
(a) (i) the Borrower shall fail to pay when due any
principal of any Loan; or (ii) the Borrower shall fail to pay when due interest
on any Loan or any fees or any other amount payable hereunder, under the Mandate
Letter or under the letter agreement referred to in Section 2.9(b) and the same
shall continue for a period of ten (10) calendar days after the same becomes
due;
(b) the Borrower shall fail to observe or perform any
covenant contained in Section 5.9, Section 5.10(a) or (b), or Sections 5.11,
5.12, and 5.14;
(c) the Borrower shall fail to observe or perform any
covenant or agreement contained in this Agreement (other than those covered by
clause (a), (b), (e), (f), (g), (h), (l) or (m) of this Section 6.1) for 30 days
after written notice thereof has been given to the Borrower by the
Administrative Agent, or if such default is of such a nature that it cannot with
reasonable effort be completely remedied within said period of thirty (30) days
such additional period of time as may be reasonably necessary to cure same,
provided Borrower commences such cure within said thirty (30) day period and
diligently prosecutes same, until completion, but in no event shall such
extended period exceed ninety (90) days;
(d) any representation, warranty, certification or statement
made by the Borrower in this Agreement or in any certificate, financial
statement or other document delivered pursuant to this Agreement shall prove to
have been incorrect in any material respect when made (or deemed made) and the
defect causing such representation or warranty to be incorrect when made (or
deemed made) is not removed within thirty (30) days after written notice thereof
from Administrative Agent to Borrower, or if such default is of such a nature
that it cannot with reasonable effort be completely removed within said period
of thirty (30) days such additional period of time as may be reasonably
necessary to
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remove same, provided Borrower commences such removal within said thirty (30)
day period and diligently prosecutes same, until completion, but in no event
shall such extended period exceed ninety (90) days;
(e) the Borrower, General Partner, any Subsidiary or any
Investment Affiliate shall default in the payment when due (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise) of any amount
owing in respect of any Recourse Debt (other than the Obligations) for which the
aggregate outstanding principal amount exceeds $10,000,000 and such default
shall continue beyond the giving of any required notice and the expiration of
any applicable grace period and such default has not been waived, in writing, by
the holder of any such Debt; or the Borrower, General Partner, any Subsidiary or
any Investment Affiliate shall default in the performance or observance of any
other obligation or condition with respect to any such Recourse Debt or any
other event shall occur or condition exist beyond the giving of any required
notice and the expiration of any applicable grace period, if the effect of such
other default, event or condition is to accelerate the maturity of any such
indebtedness or to permit (without any further requirement of notice or lapse of
time) the holder or holders thereof, or any trustee or agent for such holders,
to accelerate the maturity of any such indebtedness;
(f) the Borrower or General Partner shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or other
relief with respect to itself or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any action to authorize any of the foregoing;
(g) an involuntary case or other proceeding shall be
commenced against the Borrower or General Partner seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for a
period of 90 days; or an order for relief shall be entered against the Borrower
or General Partner under the federal bankruptcy laws as now or hereafter in
effect;
(h) one or more final, non-appealable judgments or decrees
in an aggregate amount of Ten Million Dollars ($10,000,000) or more shall be
entered by a court or courts of competent jurisdiction against the Borrower,
General Partner or its
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Consolidated Subsidiaries (other than any judgment as to which, and only to the
extent, a reputable insurance company has acknowledged coverage of such claim in
writing) and (i) any such judgments or decrees shall not be stayed, discharged,
paid, bonded or vacated within thirty (30) days or (ii) enforcement proceedings
shall be commenced by any creditor on any such judgments or decrees and such
enforcement proceedings shall not immediately be stayed;
(i) TIC shall cease to be the managing member of General
Partner;
(j) any Termination Event with respect to a Plan shall occur
as a result of which Termination Event or Events any member of the ERISA Group
has incurred or may incur any liability to the PBGC or any other Person and the
sum (determined as of the date of occurrence of such Termination Event) of the
insufficiency of such Plan and the insufficiency of any and all other Plans with
respect to which such a Termination Event shall occur and be continuing (or, in
the case of a Multiple Employer Plan with respect to which a Termination Event
described in clause (ii) of the definition of Termination Event shall occur and
be continuing, the liability of the Borrower) is equal to or greater than
$10,000,000 and which the Administrative Agent reasonably determines will have a
Material Adverse Effect;
(k) any member of the ERISA Group shall commit a failure
described in Section 302(f)(1) of ERISA or Section 412(n)(1) of the Code and the
amount of the lien determined under Section 302(f)(3) of ERISA or Section
412(n)(3) of the Code that could reasonably be expected to be imposed on any
member of the ERISA Group or their assets in respect of such failure shall be
equal to or greater than $10,000,000 and which the Administrative Agent
reasonably determines will have a Material Adverse Effect;
(l) at any time, for any reason the Borrower seeks to
repudiate its obligations under any Loan Document; or
(m) a default beyond any applicable notice and grace period
under any of the other Loan Documents.
SECTION 6.2. Rights and Remedies.
(a) Upon the occurrence of any Event of Default described in
Sections 6.1(f) or (g), the Commitment shall immediately terminate and the
unpaid principal amount of, and any and all accrued interest on, the Loans and
any and all accrued fees and other Obligations hereunder shall automatically
become immediately due and payable, with all additional interest from time to
time accrued thereon and without presentation, demand, or protest or other
requirements of any kind (including, without
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limitation, valuation and appraisement, diligence, presentment, notice of intent
to demand or accelerate and notice of acceleration), all of which are hereby
expressly waived by the Borrower; and upon the occurrence and during the
continuance of any other Event of Default, the Administrative Agent upon the
demand of the Required Banks shall, by written notice to the Borrower, in
addition to the exercise of all of the rights and remedies permitted the
Administrative Agent and the Banks at law or equity or under any of the other
Loan Documents, declare the unpaid principal amount of and any and all accrued
and unpaid interest on the Loans and any and all accrued fees and other
obligations hereunder to be, and the same shall thereupon be, immediately due
and payable with all additional interest from time to time accrued thereon and
(except as otherwise as provided in the Loan Documents) without presentation,
demand, or protest or other requirements of any kind (including, without
limitation, valuation and appraisement, diligence, presentment, notice of intent
to demand or accelerate and notice of acceleration), all of which are hereby
expressly waived by the Borrower.
(b) Notwithstanding anything to the contrary contained in
this Agreement or in any other Loan Document, the Administrative Agent, and the
Banks each agree that any exercise or enforcement of the rights and remedies
granted to the Administrative Agent or the Banks under this Agreement or at law
or in equity with respect to this Agreement or any other Loan Documents shall be
commenced and maintained by the Administrative Agent on behalf of the
Administrative Agent and/or the Banks. The Administrative Agent shall act at the
direction of the Required Banks in connection with the exercise of any and all
remedies at law, in equity or under any of the Loan Documents or, if the
Required Banks are unable to reach agreement on the exercise of remedies, then,
from and after Administrative Agent shall have declared the Loan immediately due
and payable, the Administrative Agent may pursue such rights and remedies as it
may determine.
SECTION 6.3. Notice of Default. The Administrative Agent shall
give notice to the Borrower under Section 6.1(c) promptly upon being requested
to do so by the Required Banks and shall thereupon notify all the Banks thereof.
The Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default (other than nonpayment of
principal of or interest on the Loans) unless the Administrative Agent has
received notice in writing from a Bank or Borrower referring to this Agreement
or the other Loan Documents, describing such event or condition. Should
Administrative Agent receive notice of the occurrence of a Default or Event of
Default expressly stating that such notice is a notice of a Default or Event of
Default, or should Administrative Agent send Borrower a notice of Default or
Event of Default, Administrative Agent, shall promptly give notice thereof to
each Bank.
SECTION 6.4. Distribution of Proceeds after Default. Subject to
Section 7.6, from and after an Event of Default, to the extent proceeds are
received by
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Administrative Agent, such proceeds will be distributed to the Banks pro rata in
accordance with the unpaid principal amount of the Loans. Regardless of how each
Bank may treat payments received by it pursuant to this Agreement and the Notes
delivered to evidence debt hereunder for the purpose of its own accounting, for
the purpose of computing the Borrower's obligations under this Agreement and
under such Notes, the payments shall be applied first, to the costs and expenses
(including attorneys' fees and disbursements and the allocated costs and
expenses of in-house legal and other professional services) of the
Administrative Agent, acting as Administrative Agent, and of the Banks as set
forth herein, second, to the payment of accrued and unpaid interest on all Notes
to and including the date of such application (ratably according to the accrued
and unpaid interest on the Notes), third, to the ratable payment of the unpaid
principal of all the Notes, and fourth, to the payment of all other amounts
(including fees) then owing to the Administrative Agents or the Banks under the
Loan Documents. No application of the payments will cure any Event of Default or
prevent acceleration, or continued acceleration, of amounts payable under the
Loan Documents or prevent the exercise, or continued exercise, of rights or
remedies of the Banks under this Agreement or under law.
ARTICLE VII.
THE AGENTS
SECTION 7.1. Appointment and Authorization. Each Bank
irrevocably appoints and authorizes the Administrative Agent to take such action
as agent on its behalf and to exercise such powers under this Agreement and the
other Loan Documents as are delegated to the Administrative Agent by the terms
hereof or thereof, together with all such powers as are reasonably incidental
thereto. Except as set forth in Sections 7.8 and 7.9 hereof, the provisions of
this Article VII are solely for the benefit of Administrative Agent and the
Banks, and Borrower shall not have any rights to rely on or enforce any of the
provisions hereof. In performing its functions and duties under this Agreement,
the Administrative Agent shall act solely as an agent of the Banks and shall not
assume and shall not be deemed to have assumed any obligation toward or
relationship of agency or trust with or for the Borrower.
SECTION 7.2. Agency and Affiliates. Bank of America, ▇▇▇▇▇ Fargo
and ▇▇▇▇▇▇ shall have the same rights and powers under this Agreement as any
other Bank and may exercise or refrain from exercising the same as though it
were not the Administrative Agent, Documentation Agent or an affiliate of the
Syndication Agent, respectively, and Bank of America, ▇▇▇▇▇ Fargo, ▇▇▇▇▇▇ and
their affiliates may accept deposits from, lend money to, and generally engage
in any kind of business with the Borrower, General Partner or any Subsidiary or
affiliate of the Borrower as if they were not the Administrative Agent,
Documentation Agent or an affiliate of the Syndication Agent, respectively,
hereunder, and
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the term "Bank" and "Banks" shall include Bank of America, ▇▇▇▇▇ Fargo and
▇▇▇▇▇▇ in their individual capacities.
SECTION 7.3. Action by Administrative Agent. The obligations of
the Administrative Agent hereunder are only those expressly set forth herein.
Without limiting the generality of the foregoing, the Administrative Agent shall
not be required to take any action with respect to any Default or Event of
Default, except as expressly provided in Article VI. The duties of
Administrative Agent shall be administrative in nature. Subject to the
provisions of Sections 7.1, 7.5 and 7.6, Administrative Agent shall administer
the Loans in the same manner as it administers its own loans.
SECTION 7.4. Consultation with Experts. As between
Administrative Agent and the Banks, the Administrative Agent may consult with
legal counsel (who may be counsel for the Borrower), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
advice of such counsel, accountants or experts.
SECTION 7.5. Liability of Administrative Agent. As between
Administrative Agent and the Banks, none of the Administrative Agent nor any of
their affiliates nor any of their respective directors, officers, agents or
employees shall be liable for any action taken or not taken by it in connection
herewith (i) with the consent or at the request of the Required Banks or (ii) in
the absence of its own gross negligence or willful misconduct. As between
Administrative Agent and the Banks, none of 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 this Agreement or any borrowing
hereunder; (ii) the performance or observance of any of the covenants or
agreements of the Borrower; (iii) the satisfaction of any condition specified in
Article III, except receipt of items required to be delivered to the
Administrative Agent; or (iv) the validity, effectiveness or genuineness of this
Agreement, the other Loan Documents or any other instrument or writing furnished
in connection herewith. As between Administrative Agent and the Banks, the
Administrative Agent shall not incur any liability by acting in reliance upon
any notice, consent, certificate, statement, or other writing (which may be a
bank wire, telex or similar writing) believed by it to be genuine or to be
signed by the proper party or parties.
SECTION 7.6. Indemnification. Each Bank shall, ratably in
accordance with its Commitment, indemnify the Administrative Agent and its
affiliates and its respective directors, officers, agents and employees (to the
extent not reimbursed by the Borrower) against any cost, expense (including
counsel fees and disbursements), claim, demand, action, loss or liability
(except such as result from such indemnitee's gross negligence or willful
misconduct) that such indemnitee may suffer or incur in connection with its
duties
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as Administrative Agent under this Agreement, the other Loan Documents or any
action taken or omitted by such indemnitee hereunder. In the event that the
Administrative Agent shall, subsequent to its receipt of indemnification
payment(s) from Banks in accordance with this Section, recoup any amount from
the Borrower, or any other party liable therefor in connection with such
indemnification, the Administrative Agent shall reimburse the Banks which
previously made the payment(s) pro rata, based upon the actual amounts which
were theretofore paid by each Bank. The Administrative Agent shall reimburse
such Banks so entitled to reimbursement within two (2) Domestic Business Days of
its receipt of such funds from the Borrower or such other party liable therefor.
SECTION 7.7. Credit Decision. Each Bank acknowledges that it
has, independently and without reliance upon the Administrative Agent or any
other Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Bank also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Bank, and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking any action under this
Agreement.
SECTION 7.8. Successor Administrative Agent. The Administrative
Agent may resign at any time by giving notice thereof to the Banks and the
Borrower and the Administrative Agent shall resign in the event its Commitment
is reduced to below six percent (6%) of the Aggregate Commitment. Upon any such
resignation, the Required Banks shall have the right to appoint a successor
Administrative Agent, which successor Administrative Agent shall, provided no
Event of Default has occurred and is then continuing, be subject to Borrower's
approval, which approval shall not be unreasonably withheld or delayed (except
that Borrower shall, in all events, be deemed to have approved ▇▇▇▇▇ Fargo as a
successor Administrative Agent). If no successor Administrative Agent shall have
been so appointed by the Required Banks and approved by the Borrower, and shall
have accepted such appointment, within 30 days after the retiring Administrative
Agent gives notice of resignation, then the retiring Administrative Agent may,
on behalf of the Banks, appoint a successor Administrative Agent, who shall act
until the Required Banks shall appoint a Administrative Agent. Upon the
acceptance of its appointment as the Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. After any retiring
Administrative Agent's resignation hereunder, the provisions of this Article
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was the Administrative Agent. For gross negligence or willful
misconduct, as determined by the Super-Majority Banks (excluding for such
determination Administrative Agent in its capacity as a Bank),
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Administrative Agent may be removed at any time by giving at least thirty (30)
Domestic Business Days prior written notice to Administrative Agent and
Borrower. Such resignation or removal shall take effect upon the acceptance of
appointment by a successor Administrative Agent, in accordance with the
provisions of this Section 7.8.
SECTION 7.9. Consents and Approvals. All communications from
Administrative Agent to the Banks requesting the Banks' determination, consent,
approval or disapproval (i) shall be given in the form of a written notice to
each Bank (ii) shall be accompanied by a description of the matter or item as to
which such determination, approval, consent or disapproval is requested, or
shall advise each Bank where such matter or item may be inspected, or shall
otherwise describe the matter or issue to be resolved, (iii) shall include, if
reasonably requested by a Bank and to the extent not previously provided to such
Bank, written materials and a summary of all oral information provided to
Administrative Agent by Borrower in respect of the matter or issue to be
resolved, and (iv) shall include Administrative Agent's recommended course of
action or determination in respect thereof. Each Bank shall reply promptly, but
in any event within ten (10) Domestic Business Days after receipt of the request
therefor from Administrative Agent (the "Bank Reply Period"). Unless a Bank
shall give written notice to Administrative Agent that it objects to the
recommendation or determination of Administrative Agent (together with a written
explanation of the reasons behind such objection) within the Bank Reply Period,
such Bank shall be deemed to have approved of or consented to such
recommendation or determination. With respect to decisions requiring the
approval of the Required Banks or all the Banks, Administrative Agent shall
submit its recommendation or determination for approval of or consent to such
recommendation or determination to all Banks and upon receiving the required
approval or consent shall follow the course of action or determination of the
Required Banks (and each non-responding Bank shall be deemed to have concurred
with such recommended course of action) or all the Banks, as the case may be.
ARTICLE VIII.
CHANGE IN CIRCUMSTANCES
SECTION 8.1. Basis for Determining Interest Rate Inadequate or
Unfair. If on or prior to the first day of any Interest Period for any LIBOR
Borrowing:
(a) the Administrative Agent has determined in good faith
that deposits in dollars (in the applicable amounts) are not being offered in
the relevant market for such Interest Period, or
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(b) Banks having 50% or more of the Aggregate Commitment
advise the Administrative Agent that the Adjusted London Interbank Offered Rate,
as determined by the Administrative Agent, will not adequately and fairly
reflect the cost to such Bank of funding its LIBOR Loans for such Interest
Period, the Administrative Agent shall forthwith give notice thereof to the
Borrower and the Banks, whereupon until the Administrative Agent notifies the
Borrower that the circumstances giving rise to such suspension no longer exist,
the obligations of the Banks to make LIBOR Loans shall be suspended. Unless the
Borrower notifies the Administrative Agent at least two Domestic Business Days
before the date of any LIBOR Borrowing for which a Notice of Borrowing has
previously been given that it elects not to borrow on such date, such Borrowing
shall instead be made as a Base Rate Borrowing. For purposes of this Section
8.1(b), in determining whether the Adjusted London Interbank Offered Rate, as
determined by Administrative Agent, will not adequately and fairly reflect the
cost to any Bank of funding its LIBOR Loans for such Interest Period, such
determination will be based solely on the ability of such Bank to obtain
matching funds in the London interbank market at a reasonably equivalent rate.
SECTION 8.2. Illegality. If, on or after the date of this
Agreement, the adoption of any applicable law, rule or regulation, or any change
in any applicable law, rule or regulation, or any change in the interpretation
or administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Bank (or its LIBOR Lending Office) with any request or
directive (whether or not having the force of law) made after the Closing Date
of any such authority, central bank or comparable agency shall make it unlawful
for any Bank (or its LIBOR Lending Office) to make, maintain or fund its LIBOR
Loans, the Administrative Agent shall forthwith give notice thereof to the other
Banks and the Borrower, whereupon until such Bank notifies the Borrower and the
Administrative Agent that the circumstances giving rise to such suspension no
longer exist, the obligation of such Bank to make LIBOR Loans shall be
suspended. With respect to LIBOR Loans, before giving any notice to the
Administrative Agent pursuant to this Section, such Bank shall designate a
different LIBOR Lending Office if such designation will avoid the need for
giving such notice and will not, in the judgment of such Bank, be otherwise
disadvantageous to such Bank. If such Bank shall determine that it may not
lawfully continue to maintain and fund any of its outstanding LIBOR Loans to
maturity and shall so specify in such notice, the Borrower shall be deemed to
have delivered a Notice of Interest Rate Election and such LIBOR Loan shall be
converted as of such date to a Base Rate Loan (without payment of any amounts
that Borrower would otherwise be obligated to pay pursuant to Section 2.13
hereof with respect to Loans converted pursuant to this Section 8.2) in an equal
principal amount from such Bank (on which interest and principal shall be
payable contemporaneously with the related LIBOR Loans of the other Banks), and
such Bank shall make such a Base Rate Loan.
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If at any time, it shall be unlawful for any Bank to make,
maintain or fund its LIBOR Loans, the Borrower shall have the right, upon five
(5) Domestic Business Day's notice to the Administrative Agent, to either (x)
cause a bank, reasonably acceptable to the Administrative Agent, to offer to
purchase the Commitments of such Bank for an amount equal to such Bank's
outstanding Loans, and to become a Bank hereunder, or obtain the agreement of
one or more existing Banks to offer to purchase the Commitments of such Bank for
such amount, which offer such Bank is hereby required to accept, or (y) to repay
in full all Loans then outstanding of such Bank, together with interest and all
other amounts due thereon, upon which event, such Bank's Commitments shall be
deemed to be canceled pursuant to Section 2.11(c).
SECTION 8.3. Increased Cost and Reduced Return.
(a) If, on or after the date hereof in the case of Committed
Loans made pursuant to Section 2.1, the adoption of any applicable law, rule or
regulation, or any change in any applicable law, rule or regulation, or any
change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Bank (or its Applicable Lending
Office) with any request or directive (whether or not having the force of law)
made at the Closing Date of any such authority, central bank or comparable
agency shall impose, modify or deem applicable any reserve (including, without
limitation, any such requirement imposed by the Board of Governors of the
Federal Reserve System (but excluding with respect to any LIBOR Loan any such
requirement reflected in an applicable LIBOR Reserve Percentage)), special
deposit, insurance assessment or similar requirement against assets of, deposits
with or for the account of, or credit extended by, any Bank (or its Applicable
Lending Office) or shall impose on any Bank (or its Applicable Lending Office)
or on the London interbank market any other condition materially more burdensome
in nature, extent or consequence than those in existence as of the Closing Date
affecting such Bank's LIBOR Loans, its Note, or its obligation to make LIBOR
Loans, and the result of any of the foregoing is to increase the cost to such
Bank (or its Applicable Lending Office) of making or maintaining any LIBOR Loan,
or to reduce the amount of any sum received or receivable by such Bank (or its
Applicable Lending Office) under this Agreement or under its Note with respect
to such LIBOR Loans, by an amount deemed by such Bank to be material, then,
within fifteen (15) days after demand by such Bank (with a copy to the
Administrative Agent), the Borrower shall pay to such Bank such additional
amount or amounts (based upon a reasonable allocation thereof by such Bank to
the LIBOR Loans made by such Bank hereunder) as will compensate such Bank for
such increased cost or reduction to the extent such Bank generally imposes such
additional amounts on other borrowers of such Bank in similar circumstances.
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(b) If any Bank shall have reasonably determined that, after
the date hereof, the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change in any such law, rule or regulation,
or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or any request or directive regarding
capital adequacy (whether or not having the force of law) made after the Closing
Date of any such authority, central bank or comparable agency, has or would have
the effect of reducing the rate of return on capital of such Bank (or its
Parent) as a consequence of such Bank's obligations hereunder to a level below
that which such Bank (or its Parent) could have achieved but for such adoption,
change, request or directive (taking into consideration its policies with
respect to capital adequacy) by an amount reasonably deemed by such Bank to be
material, then from time to time, within fifteen (15) days after demand by such
Bank (with a copy to the Administrative Agent), the Borrower shall pay to such
Bank such additional amount or amounts as will compensate such Bank (or its
Parent) for such reduction to the extent such Bank generally imposes such
additional amounts on other borrowers of such Bank in similar circumstances.
(c) Each Bank will promptly notify the Borrower and the
Administrative Agent of any event of which it has knowledge, occurring after the
date hereof, which will entitle such Bank to compensation pursuant to this
Section and will designate a different Applicable Lending office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the reasonable judgment of such Bank, be otherwise
disadvantageous to such Bank. If such Bank shall fail to notify Borrower of any
such event within ninety (90) days following the end of the month during which
such event occurred, then Borrower's liability for any amounts described in this
Section incurred by such Bank as a result of such event shall be limited to
those attributable to the period occurring subsequent to the ninetieth (90th)
day prior to the date upon which such Bank actually notified Borrower of the
occurrence of such event. A certificate of any Bank claiming compensation under
this Section and setting forth a reasonably detailed calculation of the
additional amount or amounts to be paid to it hereunder shall be conclusive in
the absence of demonstrable error. In determining such amount, such Bank may use
any reasonable averaging and attribution methods.
(d) If at any time, any Bank shall be owed amounts pursuant
to this Section 8.3, the Borrower shall have the right, upon five (5) Domestic
Business Day's notice to the Administrative Agent to either (x) cause a bank,
reasonably acceptable to the Administrative Agent, to offer to purchase the
Commitments of such Bank for an amount equal to such Bank's outstanding Loans,
and to become a Bank hereunder, or to obtain the agreement of one or more
existing Banks to offer to purchase the Commitments of such Bank for such
amount, which offer such Bank is hereby required to accept, or (y) to repay in
full all Loans then outstanding of such Bank, together with interest and all
other amounts
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due thereon, upon which event, such Bank's Commitment shall be deemed to be
canceled pursuant to Section 2.11(c).
SECTION 8.4. Taxes.
(a) Any and all payments by the Borrower to or for the
account of any Bank or the Administrative Agent hereunder or under any other
Loan Document shall be made free and clear of and without deduction for any and
all present or future taxes, duties, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in the case
of each Bank and the Administrative Agent, taxes imposed on its income, and
franchise taxes imposed on it, by the jurisdiction under the laws of which such
Bank or the Administrative Agent (as the case may be) is organized or any
political subdivision thereof and, in the case of each Bank, taxes imposed on
its income, and franchise or similar taxes imposed on it, by the jurisdiction of
such Bank's Applicable Lending Office or any political subdivision thereof or by
any other jurisdiction (or any political subdivision thereof) as a result of a
present or former connection between such Bank or Administrative Agent and such
other jurisdiction or by the United States (all such non-excluded taxes, duties,
levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as "Non-Excluded Taxes"). If the Borrower shall be
required by law to deduct any Non-Excluded Taxes from or in respect of any sum
payable hereunder or under any Note, (i) 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 8.4) such Bank 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, (ii) the Borrower shall
make such deductions, (iii) the Borrower shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with applicable
law and (iv) the Borrower shall furnish to the Administrative Agent, at its
address referred to in Section 9.1, the original or a certified copy of a
receipt evidencing payment thereof.
(b) In addition, the Borrower agrees to pay any present or
future stamp or documentary taxes and any other excise or property taxes, or
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 (hereinafter referred to as "Other Taxes").
(c) The Borrower agrees to indemnify each Bank and the
Administrative Agent for the full amount of Non-Excluded Taxes or Other Taxes
(including, without limitation, any Non-Excluded Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section 8.4) paid by
such Bank or the Administrative Agent (as the case may be) and, so long as such
Bank or Administrative Agent has promptly paid
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any such Non-Excluded Taxes or Other Taxes, any liability for penalties and
interest arising therefrom or with respect thereto. This indemnification shall
be made within fifteen (15) days from the date such Bank or the Administrative
Agent (as the case may be) makes demand therefor.
(d) Each Bank organized under the laws of a jurisdiction
outside the United States, on or prior to the date of its execution and delivery
of this Agreement in the case of each Bank listed on the signature pages hereof
and on or prior to the date on which it becomes a Bank in the case of each other
Bank, shall provide the Borrower with (a) two duly completed copies of Internal
Revenue Service form 1001 or 4224, as appropriate, or any successor form
prescribed by the Internal Revenue Service, and (b) an Internal Revenue Service
Form W-8 or W-9, or any successor form prescribed by the Internal Revenue
Service, and shall provide Borrower with two further copies of any such form or
certification on or before the date that any such form or certification expires
or becomes obsolete and after the occurrence of any event requiring a change in
the most recent form previously delivered by it to Borrower, certifying (i) in
the case of a Form 1001 or 4224, that such Bank is entitled to benefits under an
income tax treaty to which the United States is a party which reduces the rate
of withholding tax on payments of interest or certifying that the income
receivable pursuant to this Agreement is effectively connected with the conduct
of a trade or business in the United States, and (ii) in the case of a Form W-8
or W-9, that it is entitled to an exemption from United States backup
withholding tax. If the form provided by a Bank at the time such Bank first
becomes a party to this Agreement indicates a United States interest withholding
tax rate in excess of zero, withholding tax at such rate shall be considered
excluded from "Non-Excluded Taxes" as defined in Section 8.4(a).
(e) For any period with respect to which a Bank has failed
to provide the Borrower with the appropriate form pursuant to Section 8.4(d)
(unless such failure is due to a change in treaty, law or regulation occurring
subsequent to the date on which a form originally was required to be provided),
such Bank shall not be entitled to indemnification under Section 8.4(c) with
respect to Non-Excluded Taxes imposed by the United States, provided, however,
that should a Bank, which is otherwise exempt from or subject to a reduced rate
of withholding tax, become subject to Non-Excluded Taxes because of its failure
to deliver a form required hereunder, the Borrower shall take such steps as such
Bank shall reasonably request to assist such Bank to recover such Taxes so long
as Borrower shall incur no cost or liability as a result thereof.
(f) If the Borrower is required to pay additional amounts to
or for the account of any Bank pursuant to this Section 8.4, then such Bank will
change the jurisdiction of its Applicable Lending Office so as to eliminate or
reduce any such
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additional payment which may thereafter accrue if such change, in the judgment
of such Bank, is not otherwise disadvantageous to such Bank.
(g) If at any time, any Bank shall be owed amounts pursuant
to this Section 8.4, the Borrower shall have the right, upon five (5) Domestic
Business Day's notice to the Administrative Agent to either (x) cause a bank,
reasonably acceptable to the Administrative Agent, to offer to purchase the
Commitments of such Bank for an amount equal to such Bank's outstanding Loans,
and to become a Bank hereunder, or to obtain the agreement of one or more
existing Banks to offer to purchase the Commitments of such Bank for such
amount, which offer such Bank is hereby required to accept, or (y) to repay in
full all Loans then outstanding of such Bank, together with interest and all
other amounts due thereon, upon which event, such Bank's Commitment shall be
deemed to be canceled pursuant to Section 2.11(c).
SECTION 8.5. Base Rate Loans Substituted for Affected LIBOR
Loans. If (i) the obligation of any Bank to make LIBOR Loans has been suspended
pursuant to Section 8.2 or (ii) any Bank has demanded compensation under Section
8.3 or 8.4 with respect to its LIBOR Loans and the Borrower shall, by at least
five LIBOR Business Days' prior notice to such Bank through the Administrative
Agent, have elected that the provisions of this Section shall apply to such
Bank, then, unless and until such Bank notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer exist:
(a) Borrower shall be deemed to have delivered a Notice of
Interest Rate Election with respect to such affected LIBOR Loans and thereafter
all Loans which would otherwise be made by such Bank as LIBOR Loans shall be
made instead as Base Rate Loans (on which interest and principal shall be
payable contemporaneously with the related LIBOR Loans of the other Banks), and
(b) after each of its LIBOR Loans has been repaid, all
payments of principal which would otherwise be applied to repay such LIBOR Loans
shall be applied to repay its Base Rate Loans instead, and
(c) Borrower will not be required to make any payment which
would otherwise be required by Section 2.12 with respect to such LIBOR Loans
converted to Base Rate Loans pursuant to clause (a) above.
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ARTICLE IX.
MISCELLANEOUS
SECTION 9.1. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, facsimile transmission followed by telephonic confirmation or similar
writing) and shall be given to such party: (x) in the case of the Borrower or
the Administrative Agent, at its address, telex number or facsimile number set
forth on the signature pages hereof with a duplicate copy thereof, in the case
of the Borrower, to the Borrower, at Irvine Apartment Communities, L.P. c/o TIC
Acquisition LLC, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attn: Vice President, Corporate Finance, and to O'Melveny & ▇▇▇▇▇, LLP, ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn:
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq., (y) in the case of any Bank, at its address, telex number
or facsimile number set forth on the signature pages hereof or (z) in the case
of any party, such other address, telex number or facsimile number as such party
may hereafter specify for the purpose by notice to the Administrative Agent and
the Borrower. Each such notice, request or other communication shall be
effective (i) if given by telex or facsimile transmission, when such telex or
facsimile is transmitted to the telex number or facsimile number specified in
this Section and the appropriate answerback or facsimile confirmation is
received (provided, however, if the date of such transmission and confirmation
is not a Domestic Business Day, then the next succeeding Domestic Business Day),
(ii) if given by certified registered mail, return receipt requested, with first
class postage prepaid, addressed as aforesaid, upon receipt or refusal to accept
delivery, (iii) if given by a nationally recognized overnight carrier, 24 hours
after such communication is deposited with such carrier with postage prepaid for
next day delivery, or (iv) if given by any other means, when delivered at the
address specified in this Section; provided that notices to the Administrative
Agent under Article II or Article VIII shall not be effective until received.
SECTION 9.2. No Waivers. No failure or delay by the
Administrative Agent or any Bank in exercising any right, power or privilege
hereunder or under any Note shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any rights or
remedies provided by law.
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SECTION 9.3. Expenses; Indemnification.
(a) The Borrower shall pay within thirty (30) days after
written notice from the Administrative Agent all reasonable out-of-pocket costs
and expenses of the Administrative Agent (including the fees and disbursements
of outside counsel as well as the allocated cost of Administrative Agent's
internal legal services), in connection with the preparation of this Agreement,
the Loan Documents and the documents and instruments referred to therein, and
any waiver, consent hereunder and any amendment hereof, the administration
hereof and any Default or alleged Default hereunder, (ii) in connection with the
syndication of the Loans and (iii) if an Event of Default occurs, all reasonable
out-of-pocket expenses incurred by the Administrative Agent and the Banks as a
group, including fees and disbursements of counsel for the Administrative Agent
and each of the Banks, in connection with the enforcement of the Loan Documents
and the instruments referred to therein and such Event of Default and
collection, bankruptcy, insolvency and other enforcement proceedings resulting
therefrom; provided, however, that the attorneys' fees and disbursements for
which Borrower is obligated under this subsection (a)(iii) shall be limited to
the reasonable non-duplicative fees and disbursements of (a) counsel for
Administrative Agent and (b) counsel for all of the Banks as a group. For
purposes of this Section 9.3(a)(iii), (1) counsel for Administrative Agent shall
mean a single outside law firm representing Administrative Agent together with
the allocated cost of Administrative Agent's internal legal services, and (2)
counsel for all of the Banks as a group shall mean a single outside law firm
representing such Banks as a group (which law firm may or may not be the same
law firm representing Administrative Agent).
(b) The Borrower agrees to indemnify the Administrative
Agent, each Bank and their respective affiliates and the respective directors,
officers, agents and employees of the foregoing (each an "Indemnitee") and hold
each Indemnitee harmless from and against any and all liabilities, losses,
damages, costs and expenses of any kind, including, without limitation, the
reasonable fees and disbursements of counsel, which may be incurred by such
Indemnitee in connection with any investigative, administrative or judicial
proceeding that may at any time (including, without limitation, at any time
following the payment of the Obligations) be asserted against any Indemnitee, as
a result of, or arising out of, or related to or by reason of, (i) any of the
transactions contemplated by the Loan Documents or the execution, delivery or
performance of any Loan Document, (ii) any violation by the Borrower or the
Environmental Affiliates of any applicable Environmental Law, (iii) any
Environmental Claim arising out of the management, use, control, ownership or
operation of property or assets by the Borrower or any of the Environmental
Affiliates, including, without limitation, all on-site and off-site activities
of Borrower or any Environmental Affiliate involving Materials of Environmental
Concern, (iv) the breach of any environmental representation or warranty set
forth herein, but in all cases excluding those liabilities, losses, damages,
costs and expenses (a) for which such
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Indemnitee has been compensated pursuant to the terms of this Agreement, (b)
incurred solely by reason of the gross negligence, willful misconduct, bad faith
or fraud of any Indemnitee as finally determined by a court of competent
jurisdiction, (c) violations of Environmental Laws relating to a Property which
are caused by the act or omission of such Indemnitee after such Indemnitee takes
possession or control (but in no event shall appointment of a receiver or a
trustee be deemed control) of such Property or (d) any liability of such
Indemnitee to any third party based upon Contractual Obligations of such
Indemnitee owing to such third party which are not expressly set forth in the
Loan Documents. In addition, the indemnification set forth in this Section
9.3(b) in favor of any director, officer, agent or employee of Administrative
Agent or any Bank shall be solely in their respective capacities as such
director, officer, agent or employee. The Borrower's obligations under this
Section shall survive the termination of this Agreement and the payment of the
Obligations.
(c) Each Indemnitee will promptly notify the Borrower of
each event of which it has knowledge that may give rise to a claim under clause
(b) of Section 9.3, provided that the failure to so notify the Borrower shall in
no way impair the Borrower's obligations under this Section 9.3 (except to the
extent that such failure to so notify arises from the gross negligence or
willful misconduct of such Indemnitee and has an adverse effect on the
Borrower). If any investigative, judicial or administrative proceeding is
brought against any Indemnitee indemnified or intended to be indemnified
pursuant to this Section 9.3, the Borrower, to the extent and in the manner
directed by the Indemnitee, will resist and defend such proceeding with counsel
designated by the Borrower (which counsel shall be reasonably satisfactory to
the Indemnitee). Each Indemnitee will use its best efforts to cooperate in the
defense of any such action, writ, or proceeding. The Borrower shall keep such
Indemnitee advised of the status of such defense and consult with such
Indemnitee prior to taking any material position with respect thereto. Such
Indemnitee shall, however, be entitled to employ counsel separate from counsel
for the Borrower and from any other party in such proceeding if such Indemnitee
shall reasonably determine that a conflict of interest or other circumstance
exists that makes representation by counsel chosen by the Borrower not
advisable. The fees and disbursements of such separate counsel shall be paid by
the Borrower. Such Indemnitee shall not agree to the settlement of any such
claim without the consent of the Borrower, unless the Borrower shall have been
given notice of the commencement of an action and shall have failed to provide
the defense thereof as herein provided or an Event of Default shall have
occurred.
SECTION 9.4. Sharing of Set-Offs. In addition to any rights now
or hereafter granted under applicable law or otherwise, and not by way of
limitation of any such rights, and after acceleration of the Obligations, each
Bank is hereby authorized at any time or from time to time, without presentment,
demand, protest or other notice of any kind to the Borrower or to any other
Person, any such notice being hereby expressly
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waived, but subject to the prior consent of the Administrative Agent, to set off
and to appropriate and apply any and all deposits (general or special, time or
demand, provisional or final) and any other indebtedness at any time held or
owing by such Bank (including, without limitation, by branches and agencies of
such Bank wherever located) to or for the credit or the account of the Borrower
against and on account of the Obligations of the Borrower then due and payable
to such Bank under this Agreement or under any of the other Loan Documents,
including, without limitation, all interests in Obligations purchased by such
Bank. Each Bank shall notify the Borrower in writing promptly after any such
set-off and the application thereof made by such Bank; provided however that the
failure to give such notice shall not affect the validity of such set-off and
application. Each Bank agrees that if it shall by exercising any right of
set-off or counterclaim or otherwise, receive payment of a proportion of the
aggregate amount of principal and interest due with respect to any Note held by
it which is greater than the proportion received by any other Bank, the Bank
receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Banks, and such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks shall be shared by the
Banks pro rata; provided that nothing in this Section shall impair the right of
any Bank to exercise any right of setoff or counterclaim it may have to any
deposits not received in connection with the Loans and to apply the amount
subject to such exercise to the payment of indebtedness of the Borrower other
than its indebtedness under the Notes. The Borrower agrees, to the fullest
extent it may effectively do so under applicable law, that any holder of a
participation in a Note, whether or not acquired pursuant to the foregoing
arrangements, may exercise rights of set-off or counterclaim and other rights
with respect to such participation as fully as if such holder of a participation
were a direct creditor of the Borrower in the amount of such participation.
Notwithstanding anything to the contrary contained herein, any Bank may, by
separate agreement with the Borrower, waive its right to set off contained
herein or granted by law and any such written waiver shall be effective against
such Bank under this Section 9.4.
SECTION 9.5. Amendments and Waivers. Any provision of this
Agreement, the Notes or any other Loan Documents may be amended or waived if,
but only if, such amendment or waiver is in writing and is signed by the
Borrower and the Required Banks; provided that no such amendment or waiver with
respect to this Agreement, the Notes or any other Loan Documents shall, unless
signed by all the Banks, (i) except as contemplated by this Agreement, increase
or decrease the Commitment of any Bank (except for a ratable decrease in the
Commitments of all Banks by election of Borrower pursuant to Section 2.11(c)) or
subject any Bank to any additional obligation, (ii) reduce the principal of or
rate of interest on any Loan or any fees hereunder, (iii) postpone the date
fixed for any payment of principal of or interest on any Loan or any fees
hereunder or for any reduction or termination of any Commitment, (iv) except as
contemplated by this Agreement, change the percentage of the Commitments or of
the aggregate unpaid principal amount of the Notes,
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or the number of Banks, which shall be required for the Banks or any of them to
take any action under this Section or any other provision of this Agreement, (v)
release the Guaranty or (vi) modify the provisions of this Section 9.5. No
amendment or waiver shall be binding against the Administrative Agent until it
shall have been notified thereof in writing.
SECTION 9.6. Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns, except that the Borrower may not assign or otherwise transfer any
of its rights under this Agreement or the other Loan Documents without the prior
written consent of all Banks and the Administrative Agent and a Bank may not
assign or otherwise transfer any of its interest under this Agreement except as
permitted in subsection (b) and (c) of this Section 9.6.
(b) Any Bank may at any time grant to any Person in any
amount, participating interests in any Loans made pursuant to this Agreement. In
addition, any Bank may at any time grant to any existing Bank or one or more
banks, finance companies, insurance or other financial institutions which (A)
has (or, in the case of a bank which is a subsidiary, such bank's parent has) a
rating of its senior debt obligations of not less than Baa-1 by Moody's, BBB by
S&P or a comparable rating by a rating agency acceptable to Administrative Agent
and (B) has total assets in excess of Ten Billion Dollars ($10,000,000,000),
participating interests in its Commitment, in an amount not less than
$10,000,000; provided that such Bank retains at least one-half of its Commitment
free and clear of any participation interest. If any Bank sells or grants an
interest to a Person described above (in each case, a "Participant"), (i) such
Bank shall make and receive all payments for the account of its Participant,
(ii) such Bank's obligations under this Agreement shall remain unchanged, (iii)
such Bank shall continue to be the sole holder of its Note and other Loan
Documents subject to the participation and shall have the sole right to enforce
its rights and remedies under the Loan Documents, (iv) the Borrower, the
Administrative Agent and the Banks shall continue to deal solely and directly
with such Bank in connection with such Bank's rights and obligations under the
Loan Documents, and (v) the participation agreement shall not restrict such
Bank's ability to agree to any amendment of the terms of the Loan Documents, or
to exercise or refrain from exercising any powers or rights that such Bank may
have under or in respect of the Loan Documents, except that the Participant may
be granted the right to consent to any (A) reduction of the rate or amount, or
any extension of the stated maturity or due date, of any principal, interest or
fees payable by the Borrower and subject to the participation, (B) increase in
the amount or extension of the stated termination or any reduction date of the
affected Commitment, or (C) release the Guaranty, except to the extent otherwise
provided in the Loan Documents. The Borrower agrees that each Participant shall,
to the extent provided in its
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participation agreement, be entitled to the benefits of Article VIII with
respect to its participating interest.
(c) Subject to the requirement that each Bank continues to
hold a minimum of six percent (6%) of the Aggregate Commitment for so long as it
is a Bank hereunder, any Bank may at any time assign, prior to the occurrence of
an Event of Default, to an existing Bank or one or more banks, finance
companies, insurance or other financial institutions which (A) has (or, in the
case of a bank which is a subsidiary, such bank's parent has) a rating of its
senior debt obligations of not less than Baa-1 by Moody's, BBB by S&P or a
comparable rating by a rating agency acceptable to Administrative Agent and (B)
has total assets in excess of Ten Billion Dollars ($10,000,000,000), in minimum
amounts of not less than six percent (6%) of the Aggregate Commitment and
integral multiples of One Million Dollars ($1,000,000) thereafter (or any lesser
amount in the case of assignments to an existing Bank) so long as such
assignment is made with (and subject to) the consent of the Administrative
Agent, which shall not be unreasonably withheld or delayed; provided that if an
Assignee is an affiliate of such transferor Bank or was a Bank immediately prior
to such assignment, no such consent shall be required. After the occurrence and
during the continuance of an Event of Default, any Bank may at any time assign
to any Person in any amount, all or a proportionate part of all, of its rights
and obligations under this Agreement, the Notes and the other Loan Documents. In
either case, such Person (in each case, an "Assignee") shall assume such rights
and obligations, pursuant to a Transfer Supplement in substantially the form of
Exhibit "J" hereto executed by such Assignee and such transferor Bank, and a
copy thereof shall be promptly furnished to the Administrative Agent. Upon
execution and delivery of a Transfer Supplement and payment by such Assignee to
such transferor Bank of an amount equal to the purchase price agreed between
such transferor Bank and such Assignee, such Assignee shall be a Bank party to
this Agreement and shall have all the rights and obligations of a Bank with a
Commitment as set forth in such a Transfer Supplement, and no further consent or
action by any party shall be required and the transferor Bank shall be released
from its obligations hereunder to a corresponding extent. Upon the consummation
of any assignment pursuant to this subsection (c), the transferor Bank, the
Administrative Agent and the Borrower shall make appropriate arrangements so
that, if required, a new Note is issued to the Assignee. In connection with any
such assignment, the transferor Bank shall pay to the Administrative Agent an
administrative fee for processing such assignment in the amount of $2,500. If
the Assignee is not incorporated under the laws of the United States of America
or a state thereof, it shall deliver to the Borrower and the Administrative
Agent certification as to exemption from deduction or withholding of any United
States federal, income taxes in accordance with Section 8.4. Any assignment,
made during the continuation of an Event of Default shall not be affected by any
subsequent cure of such Event of Default.
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(d) Any Bank may at any time assign all or any portion of
its rights under this Agreement and its Note to a Federal Reserve Bank. No such
assignment shall release the transferor Bank from its obligations hereunder.
(e) No Assignee, Participant or other transferee of any
Bank's rights shall be entitled to receive any greater payment under Section 8.3
or 8.4 than such Bank would have been entitled to receive with respect to the
rights transferred, unless such transfer is made with the Borrower's prior
written consent or by reason of the provisions of Section 8.2, 8.3 or 8.4
requiring such Bank to designate a different Applicable Lending Office under
certain circumstances or at a time when the circumstances giving rise to such
greater payment did not exist.
SECTION 9.7. Collateral. Each of the Banks represents to the
Administrative Agent and each of the other Banks that it in good faith is not
relying upon any "margin stock" (as defined in Regulation U) as collateral in
the extension or maintenance of the credit provided for in this Agreement.
SECTION 9.8. Governing Law; Submission to Jurisdiction. (a) THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
GOVERNED BY THE LAWS OF THE STATE OF CALIFORNIA EXCEPT TO THE EXTENT PREEMPTED
BY FEDERAL LAW (WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING TO
CONFLICTS OF LAW).
(b) Any legal action or proceeding with respect to this
Agreement or any other Loan Document and any action for enforcement of any
judgment in respect thereof may be brought in the courts of the State of
California or of the United States of America located in Orange County,
California, and, by execution and delivery of this Agreement, the Banks and the
Borrower each hereby accepts for itself and in respect of its property,
generally and unconditionally, the non-exclusive jurisdiction of the aforesaid
courts and appellate courts from any thereof. The Banks and the Borrower
irrevocably consent to the service of process out of any of the aforementioned
courts in any such action or proceeding by the hand delivery, or mailing of
copies thereof by registered or certified mail, postage prepaid, to the Banks
and the Borrower at their respective addresses set forth below. The Banks and
the Borrower hereby irrevocably waive any objection which it may now or
hereafter have to the laying of venue of any of the aforesaid actions or
proceedings arising out of or in connection with this Agreement or any other
Loan Document brought in the courts referred to above and hereby further
irrevocably waive and agree not to plead or claim in any such court that any
such action or proceeding brought in any such court has been brought in an
inconvenient forum. Nothing herein shall affect the right of the
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Borrower or Administrative Agent to serve process in any other manner permitted
by law or to commence legal proceedings or otherwise proceed against any other
party in any other jurisdiction.
SECTION 9.9. Counterparts; Integration; Effectiveness. This
Agreement may be signed in any number of counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument. This Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all prior
agreements and understandings, oral or written, relating to the subject matter
hereof. This Agreement shall become effective upon receipt by the Administrative
Agent and the Borrower of counterparts hereof signed by each of the parties
hereto (or, in the case of any party as to which an executed counterpart shall
not have been received, receipt by the Administrative Agent in form satisfactory
to it of telegraphic, telex or other written confirmation from such party of
execution of a counterpart hereof by such party), and the date on which such
receipt occurs shall be the "Effective Date."
SECTION 9.10. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
ADMINISTRATIVE AGENT AND THE BANKS HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 9.11. Survival. All indemnities set forth herein shall
survive the execution and delivery of this Agreement and the other Loan
Documents and the making and repayment of the Loans hereunder.
SECTION 9.12. Domicile of Loans. Each Bank may transfer and
carry its Loans at, to or for the account of any domestic or foreign branch
office, subsidiary or affiliate of such Bank.
SECTION 9.13. Limitation of Liability. No claim may be made by
the Borrower or any other Person acting by or through Borrower against the
Administrative Agent or any Bank or the affiliates, directors, officers,
employees, attorneys or agent of any of them for any consequential or punitive
damages in respect of any claim for breach of contract or any other theory of
liability arising out of or related to the transactions contemplated by this
Agreement or by the other Loan Documents, or any act, omission or event
occurring in connection therewith; and the Borrower hereby waives, releases and
agrees not to ▇▇▇ upon any claim for any such damages, whether or not accrued
and whether or not known or suspected to exist in its favor.
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SECTION 9.14. Recourse Obligation. This Agreement and the
Obligations hereunder are fully recourse to the Borrower. Notwithstanding the
foregoing, no recourse under or upon any obligation, covenant, or agreement
contained in this Agreement shall be had against any limited partner of
Borrower, or any of their or Borrower's or General Partner's respective
officers, directors, or employees except in the event of fraud or
misappropriation of funds on the part of such officer, director, shareholder or
employee.
SECTION 9.15. Bank's Failure to Fund.
(a) Unless the Administrative Agent shall have received
notice from a Bank prior to the date of any Borrowing that such Bank will not
make available to the Administrative Agent such Bank's share of such Borrowing,
the Administrative Agent may assume that such Bank has made such share available
to the Administrative Agent on the date of such Borrowing in accordance with
subsection (b) of Section 2.4 hereof, and the Administrative Agent may, in
reliance upon such assumption, make available to Borrower on such date a
corresponding amount. If and to the extent that such Bank shall not have so made
such share available to the Administrative Agent, such Bank and Borrower
severally agree to repay to the Administrative Agent forthwith on demand such
corresponding amount together with interest thereon, in accordance with the
provisions of Section 2.4(c) hereof. If such Bank shall repay to the
Administrative Agent such corresponding amount, such amount so repaid shall
constitute such Bank's Loan included in such Borrowing for purposes of this
Agreement. Nothing contained in this Section or Section 2.4(c) shall be deemed
to reduce the Commitment of any Bank or in any way affect the rights of Borrower
with respect to any defaulting Bank or Administrative Agent. The failure of any
Bank to make available to the Administrative Agent such Bank's share of any
Borrowing in accordance with Section 2.4(b) hereof shall not relieve any other
Bank of its obligations to fund its Commitment, in accordance with the
provisions hereof.
(b) If a Bank does not advance to Administrative Agent such
Bank's pro rata share of a Loan in accordance herewith, then neither
Administrative Agent nor the other Banks shall be required or obligated to fund
such Bank's pro rata share of such Loan.
(c) As used herein, the following terms shall have the
meanings set forth below:
(i) "Defaulting Bank" shall mean any Bank which (x)
does not advance to the Administrative Agent such Bank's pro rata share of a
Loan in accordance herewith for a period of five (5) Domestic Business Days
after notice of such failure from Administrative Agent, (y) shall otherwise fail
to perform such Bank's obligations under the Loan Documents for a period of five
(5) Domestic Business Days after notice of such failure from Administrative
Agent, or (z) shall fail to pay the Administrative Agent or any
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other Bank, as the case may be, upon demand, such Bank's pro rata share of any
costs, expenses or disbursements incurred or made by the Administrative Agent
pursuant to the terms of the Loan Documents for a period of five (5) Domestic
Business Days after notice of such failure from Administrative Agent, and in all
cases, such failure is not as a result of a good faith dispute as to whether
such advance is properly required to be made pursuant to the provisions of this
Agreement, or as to whether such other performance or payment is properly
required pursuant to the provisions of this Agreement.
(ii) "Junior Creditor" means any Defaulting Bank
which has not (x) fully cured each and every default on its part under the Loan
Documents and (y) unconditionally tendered to the Administrative Agent such
Defaulting Bank's pro rata share of all costs, expenses and disbursements
required to be paid or reimbursed pursuant to the terms of the Loan Documents.
(iii) "Payment in Full" means, as of any date, the
receipt by the Banks who are not Junior Creditors of an amount of cash, in
lawful currency of the United States, sufficient to indefeasibly pay in full all
Senior Debt.
(iv) "Senior Debt" means (x) collectively, any and
all indebtedness, obligations and liabilities of the Borrower to the Banks who
are not Junior Creditors from time to time, whether fixed or contingent, direct
or indirect, joint or several, due or not due, liquidated or unliquidated,
determined or undetermined, arising by contract, operation of law or otherwise,
whether on open account or evidenced by one or more instruments, and whether for
principal, premium, interest (including, without limitation, interest accruing
after the filing of a petition initiating any proceeding referred to in Section
6.1(f) or (g)), reimbursement for fees, indemnities, costs, expenses or
otherwise, which arise under, in connection with or in respect of the Loans or
the Loan Documents, and (y) any and all deferrals, renewals, extensions and
refundings of, or amendments, restatements, rearrangements, modifications or
supplements to, any such indebtedness, obligation or liability.
(v) "Subordinated Debt" means (x) any and all
indebtedness, obligations and liabilities of Borrower to one or more Junior
Creditors from time to time, whether fixed or contingent, direct or indirect,
joint or several, due or not due, liquidated or unliquidated, determined or
undetermined, arising by contract, operation of law or otherwise, whether on
open account or evidenced by one or more instruments, and whether for principal,
premium, interest (including, without limitation, interest accruing after the
filing of a petition initiating any proceeding referred to in Section 6.1(f) or
(g)), reimbursement for fees, indemnities, costs, expenses or otherwise, which
arise under, in connection with or in respect of the Loans or the Loan
Documents, and (y) any and all deferrals, renewals, extensions and refundings
of, or amendments, restatements,
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rearrangements, modifications or supplements to, any such indebtedness,
obligation or liability.
(d) No Junior Creditor shall, prior to Payment in Full of
all Senior Debt:
(i) accelerate, demand payment of, ▇▇▇ upon,
collect, or receive any payment upon, in any manner, or satisfy or otherwise
discharge, any Subordinated Debt, whether for principal, interest and otherwise;
(ii) take or enforce any Liens to secure Subordinated
Debt or attach or levy upon any assets of Borrower, to enforce any Subordinated
Debt;
(iii) enforce or apply any security for any
Subordinated Debt; or
(iv) incur any debt or liability, or the like, to, or
receive any loan, return of capital, advance, gift or any other property, from,
the Borrower.
(e) In the event of:
(i) any insolvency, bankruptcy, receivership,
liquidation, dissolution, reorganization, readjustment, composition or other
similar proceeding relating to Borrower;
(ii) any liquidation, dissolution or other winding-up
of the Borrower, voluntary or involuntary, whether or not involving insolvency,
reorganization or bankruptcy proceedings;
(iii) any assignment by the Borrower for the benefit
of creditors;
(iv) any sale or other transfer of all or
substantially all assets of the Borrower; or
(v) any other marshaling of the assets of the
Borrower;
each of the Banks shall first have received Payment in Full of all Senior Debt
before any payment or distribution, whether in cash, securities or other
property, shall be made in respect of or upon any Subordinated Debt. Any payment
or distribution, whether in cash, securities or other property that would
otherwise be payable or deliverable in respect of Subordinated Debt to any
Junior Creditor but for this Agreement shall be paid or delivered directly to
the Administrative Agent for distribution to the Banks in accordance with this
Agreement until Payment in Full of all Senior Debt. If any Junior Creditor
receives any
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such payment or distribution, it shall promptly pay over or deliver the same to
the Administrative Agent for application in accordance with the preceding
sentence.
(f) Each Junior Creditor shall file in any bankruptcy or
other proceeding of Borrower in which the filing of claims is required by law,
all claims relating to Subordinated Debt that such Junior Creditor may have
against Borrower and assign to the Banks who are not Junior Creditors all rights
of such Junior Creditor thereunder. If such Junior Creditor does not file any
such claim prior to forty-five (45) days before the expiration of the time to
file such claim, Administrative Agent, as attorney-in-fact for such Junior
Creditor, is hereby irrevocably authorized to do so in the name of such Junior
Creditor or, in Administrative Agent's sole discretion, to assign the claim to a
nominee and to cause proof of claim to be filed in the name of such nominee. The
foregoing power of attorney is coupled with an interest and cannot be revoked.
The Administrative Agent shall, to the exclusion of each Junior Creditor, have
the sole right, subject to Section 9.5 hereof, to accept or reject any plan
proposed in any such proceeding and to take any other action that a party filing
a claim is entitled to take. In all such cases, whether in administration,
bankruptcy or otherwise, the Person or Persons authorized to pay such claim
shall pay to Administrative Agent the amount payable on such claim and, to the
full extent necessary for that purpose, each Junior Creditor hereby transfers
and assigns to the Administrative Agent all of the Junior Creditor's rights to
any such payments or distributions to which Junior Creditor would otherwise be
entitled.
(g) (i) If any payment or distribution of any character
or any security, whether in cash, securities or other property, shall be
received by any Junior Creditor in contravention of any of the terms hereof,
such payment or distribution or security shall be received in trust for the
benefit of, and shall promptly be paid over or delivered and transferred to,
Administrative Agent for application to the payment of all Senior Debt, to the
extent necessary to achieve Payment in Full. In the event of the failure of any
Junior Creditor to endorse or assign any such payment, distribution or security,
Administrative Agent is hereby irrevocably authorized to endorse or assign the
same as attorney-in-fact for such Junior Creditor.
(ii) Each Junior Creditor shall take such action
(including, without limitation, the execution and filing of a financing
statement with respect to this Agreement and the execution, verification,
delivery and filing of proofs of claim, consents, assignments or other
instructions that Administrative Agent may require from time to time in order to
prove or realize upon any rights or claims pertaining to Subordinated Debt or to
effectuate the full benefit of the subordination contained herein) as may, in
Administrative Agent's sole and absolute discretion, be necessary or desirable
to assure the effectiveness of the subordination effected by this Agreement.
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(h) (i) Each Bank that becomes a Junior Creditor
understands and acknowledges by its execution hereof that each other Bank is
entering into this Agreement and the Loan Documents in reliance upon the
absolute subordination in right of payment and in time of payment of
Subordinated Debt to Senior Debt as set forth herein.
(ii) Only upon the Payment in Full of all Senior Debt
shall any Junior Creditor be subrogated to any remaining rights of the Banks
which are not Defaulting Banks to receive payments or distributions of assets of
the Borrower made on or applicable to any Senior Debt.
(iii) Each Junior Creditor agrees that it will deliver
all instruments or other writings evidencing any Subordinated Debt held by it to
Administrative Agent, promptly after request therefor by the Administrative
Agent.
(iv) No Junior Creditor may at any time sell, assign
or otherwise transfer any Subordinated Debt, or any portion thereof, including,
without limitation, the granting of any Lien thereon, unless and until
satisfaction of the requirements of Section 9.6 above and the proposed
transferee shall have assumed in writing the obligation of the Junior Creditor
to the Banks under this Agreement, in a form acceptable to the Administrative
Agent.
(v) If any of the Senior Debt, should be
invalidated, avoided or set aside, the subordination provided for herein
nevertheless shall continue in full force and effect and, as between the Banks
which are not Defaulting Banks and all Junior Creditors, shall be and be deemed
to remain in full force and effect.
(vi) Each Junior Creditor hereby irrevocably waives,
in respect of Subordinated Debt, all rights (x) under Sections 361 through 365,
502(e) and 509 of the Bankruptcy Code (or any similar sections hereafter in
effect under any other Federal or state laws or legal or equitable principles
relating to bankruptcy, insolvency, reorganizations, liquidations or otherwise
for the relief of debtors or protection of creditors), and (y) to seek or obtain
conversion to a different type of proceeding or to seek or obtain dismissal of a
proceeding, in each case in relation to a bankruptcy, reorganization, insolvency
or other proceeding under similar laws with respect to the Borrower. Without
limiting the generality of the foregoing, each Junior Creditor hereby
specifically waives (A) the right to seek to give credit (secured or otherwise)
to the Borrower in any way under Section 364 of the Bankruptcy Code unless the
same is subordinated in all respects to Senior Debt in a manner acceptable to
Administrative Agent in its sole and absolute discretion and (B) the right to
receive any collateral security (including any "super priority" or equal or
"priming" or replacement Lien) for any Subordinated Debt unless the Banks which
are not Defaulting Banks have received a senior position acceptable to the Banks
in
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their sole and absolute discretion to secure all Senior Debt (in the same
collateral to the extent collateral is involved).
(i) (i) In addition to and not in limitation of the
subordination effected by this Section 9.15, the Administrative Agent and each
of the Banks which are not Defaulting Banks may in their respective sole and
absolute discretion, also exercise any and all other rights and remedies
available at law or in equity in respect of a Defaulting Bank; and
(ii) The Administrative Agent shall give each of the
Banks notice of the occurrence of a default under this Section 9.15 by a
Defaulting Bank and if the Administrative Agent and/or one or more of the other
Banks shall, at their option, fund any amounts required to be paid or advanced
by a Defaulting Bank, the other Banks who have elected not to fund any portion
of such amounts shall not be liable for any reimbursements to the Administrative
Agent and/or to such other funding Banks.
(j) Notwithstanding anything to the contrary contained or
implied herein, a Defaulting Bank shall not be entitled to vote on any matter as
to which a vote by the Banks is required hereunder, including, without
limitation, any actions or consents on the part of the Administrative Agent as
to which the approval or consent of all the Banks or the Required Banks is
required under Article VIII, Section 9.5 or elsewhere, so long as such Bank is a
Defaulting Bank; provided, however, that in the case of any vote requiring the
unanimous consent of the Banks, if all the Banks other than the Defaulting Bank
shall have voted in accordance with each other, then the Defaulting Bank shall
be deemed to have voted in accordance with such Banks.
(k) Each of the Administrative Agent and any one or more of
the Banks which are not Defaulting Banks may, at their respective option, (i)
advance to the Borrower such Bank's pro rata share of the Loans not advanced by
a Defaulting Bank in accordance with the Loan Documents, or (ii) pay to the
Administrative Agent such Bank's pro rata share of any costs, expenses or
disbursements incurred or made by the Administrative Agent pursuant to the terms
of this Agreement not theretofore paid by a Defaulting Bank. Immediately upon
the making of any such advance by the Administrative Agent or any one of the
Banks, such Bank's pro rata share and the pro rata share of the Defaulting Bank
shall be recalculated to reflect such advance. All payments, repayments and
other disbursements of funds by the Administrative Agent to Banks shall
thereupon and, at all times thereafter be made in accordance with such Bank's
recalculated pro rata share unless and until a Defaulting Bank shall fully cure
all defaults on the part of such Defaulting Bank under the Loan Documents or
otherwise existing in respect of the Loans or this Agreement, at which time the
pro rata share of the Bank(s) which advanced sums on behalf of the Defaulting
Bank and of the Defaulting Bank shall be restored to their original percentages.
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SECTION 9.16. Dispute Resolution.
(a) Mandatory Arbitration
(i) If requested by any party thereto, any
controversy or claim between the parties hereto arising out of or relating to
this Agreement or any of the other Loan Documents (including any controversy or
claim regarding the arbitrability of such controversy or claim or based on or
arising out of an alleged tort) shall be determined by arbitration to be held in
Orange County, California in accordance with Title 9 of the U.S. Code and the
Commercial Arbitration Rules of the American Arbitration Association (the "AAA")
and the AAA's Supplementary Procedures for Large, Complex Disputes.
(ii) Any arbitration hereunder shall be held before a
single arbitrator mutually agreed to by the parties thereto, except that, if the
parties shall fail to agree to such an arbitrator within ten (10) days from the
date on which the claimant's request for arbitration is delivered to the other
party to the arbitration, such arbitration shall be held before a panel of three
arbitrators and each party shall appoint one arbitrator. The arbitrator(s) must
be either a retired judge from the California Superior or Appellate Courts or
the United States District Courts located in California or a member of the AAA
panel for hearing large, complex cases in Orange County, California. If a party
fails to nominate an arbitrator within 10 days from the date on which the
claimant's request for arbitration has been communicated to the other party, the
appointment shall be made by the AAA. The two arbitrators so appointed shall
attempt to agree upon the third arbitrator to act as chairman. If the two
arbitrators fail to nominate the chairman within 10 days from the date of
appointment of the later appointed arbitrator, the chairman shall be selected by
the AAA.
(iii) Discovery may be taken in the arbitration
proceedings pursuant to the provisions of California Code of Civil Procedure
Section 1283.05, which are incorporated herein by reference and made applicable
to any arbitration held pursuant to this Section.
(iv) The award of the arbitrator(s) shall be final,
and the parties agree to waive their right to any form of appeal, to the
greatest extent allowed by law, and to share equally the fees and expenses of
the arbitrators. Judgment upon any award of the arbitrators may be entered in
any court having jurisdiction or application may be made to such court for the
judicial acceptance of the award and for order of enforcement. All statutes of
limitation and waivers that would otherwise be applicable shall apply to any
arbitration proceeding under this Section 9.16(a).
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(b) Judicial Reference
If any such controversy or claim is not submitted to arbitration
as provided in subsection (a), but becomes the subject of a judicial action, it
shall be resolved solely and exclusively pursuant to the provisions for
reference and trial by referee set forth in California Code of Civil Procedure
Section 638 et seq., or any statute containing reasonably similar provisions
that replaces such sections, except as expressly modified by the provisions
hereof. The referee shall be a retired or former Superior Court judge practicing
in Orange County, California, who is either (i) agreed to by the parties within
ten (10) days of the notice by any party to the other of the intention to invoke
this Section to resolve the dispute, or (ii) failing such agreement, is
appointed pursuant to California Code of Civil Procedure Section 638.l (or any
statute containing reasonably similar provisions that replaces such section) in
an action filed in the Superior Court of Orange County, California. The parties
agree that any party may file (and, if necessary, the other party shall join in
such filing) with the Clerk of the Orange County Superior Court, or with the
appropriate judge of such Court, any and all petitions, motions, applications or
other documents necessary to obtain the appointment of such a referee
immediately upon the commencement of any action or proceeding to resolve any
such dispute and to conduct all necessary discovery and to proceed to a trial as
expeditiously as possible. All proceedings, including trial, before the referee
shall be conducted at a neutral location (unless otherwise stipulated by the
parties) within five miles of the Orange County Superior Court. The parties
agree that the referee shall be a judge for all purposes (including (i) ruling
on any and all discovery matters and motions and any and all pretrial or trial
motions, (ii) setting a schedule of pretrial proceedings, and (iii) making any
other orders or rulings a sitting judge of the Superior Court would be empowered
to make in any action or proceeding in the Superior Court). Any matter before
the referee shall be governed by the California Code of Civil Procedure, the
California Rules of Court, the California Evidence Code and the Local Rules of
the Orange County Superior Court. Any decision of the referee shall be
appealable to the same extent and in the same manner that such decisions would
be appealable if rendered by a judge of the Orange County Superior Court. The
Referee shall in his or her statement of decision set forth his or her findings
of fact and conclusions of law. The parties intend this reference agreement to
be specifically enforceable in accordance with Section 638.l of the California
Code of Civil Procedure.
(c) Provisional Remedies, Self-Help
Subject to Section 9.4, nothing herein shall limit the right of
any party to exercise self-help remedies such as setoff or to obtain provisional
or ancillary remedies, including an order of attachment, a temporary restraining
order, preliminary injunction or other interim relief from any court of
competent jurisdiction if such is necessary to
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93
preserve that party's rights before, during or after the pendency of any
arbitration, reference or bankruptcy proceeding.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
IRVINE APARTMENT COMMUNITIES, L.P.,
a Delaware limited partnership
By: TIC Acquisition LLC, a
Delaware limited liability company,
Its general partner
By: The Irvine Company,
a Delaware corporation,
Its managing member
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
By:
-----------------------------
Name:
---------------------------
Title:
--------------------------
Facsimile number: (▇▇▇) ▇▇▇-▇▇▇▇
Address:
c/o TIC Acquisition LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Vice President, Corporate Finance
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94
Commitment Amount
$25,000,000
LIBOR Lending Office: BANK OF AMERICA NT & SA
▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ By:
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇ Title: Vice President
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office:
▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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95
Commitment Amount
$25,000,000
LIBOR Lending Office: ▇▇▇▇▇ FARGO BANK, ▇▇
▇▇▇▇▇ Fargo Bank, NA By:
-------------------------------------
Disbursement and Operations Center Name:
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ -----------------------------------
El ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ Title:
----------------------------------
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office:
▇▇▇▇▇ Fargo Bank, NA
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Office Manager
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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Commitment Amount
$22,500,000
LIBOR Lending Office: ▇▇▇▇▇▇ GUARANTY TRUST
COMPANY OF NEW YORK
▇▇▇▇▇▇ Guaranty Trust Company
of New York
Nassau, Bahamas Office By:
c/o ▇.▇. ▇▇▇▇▇▇ Services, Inc. -------------------------------------
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ Name:
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ -----------------------------------
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Title:
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇/1872 ----------------------------------
▇▇▇▇▇▇ Guaranty Trust Company
Domestic Lending Office: of New York
c/o ▇.▇. ▇▇▇▇▇▇ Services, Inc.
▇▇▇▇▇▇ Guaranty Trust Company ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇ Newark, DE 19713-2107
Nassau, Bahamas Office Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
c/o ▇.▇. ▇▇▇▇▇▇ Services, Inc. Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇/1872
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Commitment Amount U.S. BANK NATIONAL ASSOCIATION
$20,000,000 By:
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
LIBOR Lending Office: Title: Senior Vice President
U.S. Bank National Association
▇▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office:
-----------------------------------
-----------------------------------
Attn:
---------------- --------------
____________Telecopy: (_____)______
-------------------------
-▇▇-
▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ AG LOS ANGELES
BRANCH
$12,500,000
By:
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Libor Lending Office : Title: Vice President
COMMERZBANK AG By:
Grand Cayman Branch -------------------------------------
c/o COMMERZBANK AG Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
New York Branch Title: Assistant Vice President
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Domestic Lending Office:
COMMERZBANK AG
Grand Cayman Branch
c/o COMMERZBANK AG
New York Branch
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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Commitment Amount
$10,000,000
LIBOR Lending Office: FIRST UNION NATIONAL BANK
First Union National Bank
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇-▇▇▇▇ By:
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ -------------------------------------
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Name:
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Title:
Domestic Lending Office:
First Union National Bank
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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100
Address: BANK OF AMERICA NT & SA,
as Administrative Agent
Bank of America NT & SA
▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ By:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ -------------------------------------
Attn: ▇▇▇▇ ▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Title: Vice President
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101
Address: ▇▇▇▇▇ FARGO BANK, N.A.,
as Documentation Agent
▇▇▇▇▇ Fargo Bank, NA
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ By:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ -------------------------------------
Attn: Office Manager Name:
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ Title:
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102
SCHEDULE 1
Bank Commitments
---------------------------------------------------------------------------------------------------
SHARE OF AGGREGATE
BANK COMMITMENT COMMITMENT
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
Bank of America NT & SA $ 25,000,000 20.00%
---------------------------------------------------------------------------------------------------
▇▇▇▇▇ Fargo Bank, NA $ 25,000,000 20.00%
---------------------------------------------------------------------------------------------------
▇▇▇▇▇▇ Guaranty Trust $ 22,500,000 18.00%
Company of New York
---------------------------------------------------------------------------------------------------
U.S. Bank $ 20,000,000 16.00%
---------------------------------------------------------------------------------------------------
Commerzbank AG Los $ 12,500,000 10.00%
Angeles Branch
---------------------------------------------------------------------------------------------------
First Union Bank, N.A. $ 10,000,000 8.00%
---------------------------------------------------------------------------------------------------
Fleet National Bank $ 10,000,000 8.00%
---------------------------------------------------------------------------------------------------
Total $125,000,000 100.00%
---------------------------------------------------------------------------------------------------
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103
SCHEDULE 4.6
Borrower and General Partner ERISA Plans
Irvine Apartment Communities, Inc. Savings Plan
Customary health, life and disability plans for active employees
-98-
104
Schedule 4.17
Qualifying Unencumbered Properties
Amherst Court
Newport Ridge
Orchard Park
Rancho Monterey
San Carlo
San Mateo
Santa ▇▇▇▇▇
Santa ▇▇▇▇
▇▇▇▇▇▇ Vista
Villa Coronado
Windwood ▇▇▇▇▇
Woodbridge Oaks
Woodbridge Villas
Baypointe
Cupertino
Santa Fe
Santa ▇▇▇▇▇
Santa ▇▇▇▇ ▇▇
The Colony
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105
SCHEDULE 5.14(c)(1)
San ▇▇▇▇▇▇ Limited Partnership, L.P.
IAC Management, Inc.
-100-
106
SCHEDULE 5.14(c)(2)
None
-101-
107
EXHIBIT A
FORM OF
NOTICE OF BORROWING
TO: BANK OF AMERICA, NATIONAL
TRUST AND SAVINGS ASSOCIATION
-------------------------------------
-------------------------------------
-------------------------------------
-------------------------------------
Attention:
---------------------------
Loan No.:
----------------------------
Accounting Unit No.:
-----------------
Reference is hereby made to the First Amended and Restated
Revolving Credit Agreement dated as of June 7, 1999 (as amended, supplemented,
replaced, renewed or otherwise modified from time to time, the "Credit
Agreement") among IRVINE APARTMENT COMMUNITIES, L.P., a Delaware limited
partnership (the "Borrower"), the banks listed on the signature pages thereof,
Bank of America NT&SA, as Administrative Agent, and ▇▇▇▇▇ Fargo Bank, N.A., as
Documentation Agent. Terms with initial capital letters used but not defined
herein have the meanings assigned to them in the Credit Agreement.
Pursuant to Article 2 of the Credit Agreement:
1. The Borrower hereby requests a Loan in the amount of
$___________________ on _____________________, ____(1) in the form of a
______________________________(2) [with an interest period of ________](3); and
--------
(1) Must be a Business Day.
(2) Insert form of Loan (Base Rate Loan or Fixed Rate Loan).
(3) Insert Fixed Rate Period in the case of a Fixed Rate Loan.
A-1
108
2. The Borrower hereby represents and warrants as follows:
(a) All of the representations and warranties contained in
the Credit Agreement are true and correct in all material respects on and as of
the date hereof as though made on and as of this date (except to the extent that
such representations and warranties expressly were made only as of a specific
date);
(b) No Default or Event of Default exists or would result
from the making of the Loan; and
(c) All other conditions to borrowing set forth in the
Credit Agreement are satisfied.
Date: ____________________, ____
IRVINE APARTMENT COMMUNITIES,
L.P., a Delaware limited partnership
By: TIC Acquisition LLC, a
Delaware limited liability company,
Its general partner
By: The Irvine Company,
a Delaware corporation,
Its managing member
By:
-----------------------------
[Certifying Officer]
Name:
---------------------------
Title:
--------------------------
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Exhibit G
EXHIBIT G
[FORM OF NOTICE OF CONTINUATION/ CONVERSION]
NOTICE OF CONTINUATION/CONVERSION
Pursuant to that certain First Amended and Restated Revolving
Credit Agreement dated as of June 7, 1999 among Irvine Apartment Communities,
L.P., a Delaware limited partnership (the "Borrower"), the banks listed on the
signature pages thereof, Bank of America NT&SA, as Administrative Agent, and
▇▇▇▇▇ Fargo Bank, N.A., as Documentation Agent (as the same may be amended,
supplemented, replaced, renewed or otherwise modified from time to time, the
"Credit Agreement"), this represents Borrower's request to [SELECT A OR B WITH
APPROPRIATE INSERTIONS AND DELETIONS: [A: convert $_______ in principal amount
of presently outstanding Loans that are [Base/LIBOR] Rate Loans [having an
Interest Period that expires on ___________, ____] to [Base/LIBOR] Rate Loans on
___________, ____. [The initial Interest Period for such LIBOR Rate Loans is
requested to be a ________ month period.]] [B: continue as LIBOR Rate Loans
$_____ in principal amount of presently outstanding Loans having an Interest
Period that expires on ____________, ____. The Interest Period for such LIBOR
Rate Loans commencing on _________, ____ is requested to be a _______ month
period.]] Terms with initial capital letters used but not defined herein have
the meanings assigned to them in the Credit Agreement.
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110
The undersigned Certifying Officer, to the best of his or her
knowledge, and Borrower certify that no Event of Default or Default has occurred
and is continuing under the Credit Agreement.
IRVINE APARTMENT COMMUNITIES, L.P.,
a Delaware limited partnership
By: TIC Acquisition LLC, a
Delaware limited liability company,
Its general partner
By: The Irvine Company,
a Delaware corporation,
Its managing member
By:
-----------------------------
[Certifying Officer]
Name:
---------------------------
Title:
--------------------------
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111
Exhibit J
EXHIBIT J
TRANSFER SUPPLEMENT
TRANSFER SUPPLEMENT (this "Transfer Supplement") dated as of
_______________, 199_ between _________________ (the "Assignor") and
____________________ having an address at ____________________________ (the
"Purchasing Bank").
W I T N E S S E T H:
WHEREAS, the Assignor has made loans to Irvine Apartment Communities,
L.P., a Delaware limited partnership (the "Borrower"), pursuant to the First
Amended and Restated Revolving Credit Agreement, dated as of June 7, 1999 (as
the same may be amended, supplemented, replaced, renewed or otherwise modified
from time to time through the date hereof, the "Credit Agreement"), among the
Borrower, the banks listed on the signature pages thereof, Bank of America
NT&SA, as Administrative Agent, and ▇▇▇▇▇ Fargo Bank, N.A., as Documentation
Agent. All capitalized terms used and not otherwise defined herein shall have
the respective meanings set forth in the Credit Agreement;
WHEREAS, the Purchasing Bank desires to purchase and assume from the
Assignor, and the Assignor desires to sell and assign to the Purchasing Bank,
certain rights, title, interest and obligations under the Credit Agreement.
NOW, THEREFORE, IT IS AGREED:
1. In consideration of the amount set forth in the receipt (the
"Receipt") given by Assignor to Purchasing Bank of even date herewith, and
transferred by wire to Assignor, the Assignor hereby assigns and sells, without
recourse, representation or warranty except as specifically set forth herein, to
the Purchasing Bank, and the Purchasing Bank hereby purchases and assumes from
the Assignor, a ___% interest (the "Purchased Interest") of the Loans
constituting a portion of the Assignor's rights and obligations under the Credit
Agreement as of the Effective Date (as defined below) including, without
limitation, such percentage interest of the Assignor in any Loans owing to the
Assignor, and Note held by the Assignor, any Loan Commitment of the Assignor and
any other interest of the Assignor under any of the Loan Documents.
2. The Assignor (i) represents and warrants that as of the date
hereof the aggregate outstanding principal amount of its share of the Loans
owing to it (without giving effect to assignments thereof which have not yet
become effective) is
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$______________; (ii) represents and warrants that it is the legal and
beneficial owner of the interests being assigned by it hereunder and that such
interests are free and clear of any adverse claim; (iii) represents and warrants
that it has not received any notice of Default or Event of Default from the
Borrower; (iv) represents and warrants that it has full power and authority to
execute and deliver, and perform under, this Transfer Supplement, and all
necessary corporate and/or partnership action has been taken to authorize, and
all approvals and consents have been obtained for, the execution, delivery and
performance thereof; (v) represents and warrants that this Transfer Supplement
constitutes its legal, valid and binding obligation enforceable in accordance
with its terms; (vi) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations (or
the truthfulness or accuracy thereof) made in or in connection with the Credit
Agreement, or the other Loan Documents or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit Agreement, or
the other Loan Documents or any other instrument or document furnished pursuant
thereto; and, (vii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or the
performance or observance by the Borrower of any of its obligations under the
Credit Agreement or the other Loan Documents or any other instrument or document
furnished pursuant thereto. Except as specifically set forth in this Paragraph
2, this assignment shall be without recourse to Assignor.
3. The Purchasing Bank (i) confirms that it has received a copy of
the Credit Agreement, and the other Loan Documents, together with such 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 Transfer
Supplement and to become a party to the Credit Agreement, and has not relied on
any statements made by Assignor or ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP; (ii) agrees that
it will, independently and without reliance upon any of the Administrative
Agent, the Assignor or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
appraisal of and investigation into the business, operations, property,
prospects, financial and other conditions and creditworthiness of the Borrower
and will make its own credit analysis, appraisals and decisions in taking or not
taking action under the Credit Agreement, and the other Loan Documents; (iii)
appoints and authorizes the Administrative Agent to take such action as agent on
its behalf and to exercise such powers under the Credit Agreement, and the other
Loan Documents as are delegated to the Agent by the terms thereof, together with
such powers as are incidental thereto; (iv) agrees that it will be bound by and
perform in accordance with their terms all of the obligations which by the terms
of the Credit Agreement are required to be performed by it as a Bank; (v)
specifies as its address for notices and lending office, the office set forth
beneath its name on the signature page hereof; (vi) it has full power and
authority to execute and deliver, and perform under, this Transfer Supplement,
and all necessary corporate and/or partnership action has been taken to
authorize, and all
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approvals and consents have been obtained for, the execution, delivery and
performance thereof; (vii) this Transfer Supplement constitutes its legal, valid
and binding obligation enforceable in accordance with its terms; and (viii) the
interest being assigned hereunder is being acquired by it for its own account,
for investment purposes only and not with a view to the public distribution
thereof and without any present intention of its resale in either case that
would be in violation of applicable securities laws.
4. This Transfer Supplement shall be effective on the date (the
"Effective Date") on which all of the following have occurred (i) it shall have
been executed and delivered by the parties hereto, (ii) copies hereof shall have
been delivered to the Administrative Agent and the Borrower, (iii) Purchasing
Bank shall have received an original Note and (iv) the Purchasing Bank shall
have paid to the Assignor the agreed purchase price as set forth in the Receipt.
5. On and after the Effective Date, (i) the Purchasing Bank shall
be a party to the Credit Agreement and, to the extent provided in this Transfer
Supplement, have the rights and obligations of a Bank thereunder and be entitled
to the benefits and rights of the Banks thereunder and (ii) the Assignor shall,
to the extent provided in this Transfer Supplement as to the Purchased Interest,
relinquish its rights and be released from its obligations under the Credit
Agreement.
6. From and after the Effective Date, the Assignor shall cause the
Administrative Agent to make all payments under the Credit Agreement, and the
Notes in respect of the Purchased Interest assigned hereby (including, without
limitation, all payments of principal, fees and interest with respect thereto
and any amounts accrued but not paid prior to such date) to the Purchasing Bank.
7. This Transfer Supplement may be executed in any number of
counterparts which, when taken together, shall be deemed to constitute one and
the same instrument.
8. Assignor hereby represents and warrants to Purchasing Bank that
it has made all payments demanded to date by Bank of America, NT&SA ("Bank of
America") as Administrative Agent in connection with the Assignor's pro rata
share of the obligation to reimburse the Agent for its expenses and made all
Loans required. In the event Bank of America, as Administrative Agent, shall
demand reimbursement for fees and expenses from Purchasing Bank for any period
prior to the Effective Date, Assignor hereby agrees to promptly pay Bank of
America, as Administrative Agent, such sums directly, subject, however, to
Paragraph 12 hereof.
9. Assignor will, at the cost of Assignor, and without expense to
Purchasing Bank, do, execute, acknowledge and deliver all and every such further
acts,
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deeds, conveyances, assignments, notices of assignments, transfers and
assurances as Purchasing Bank shall, from time to time, reasonably require, for
the better assuring conveying, assigning, transferring and confirming unto
Purchasing Bank the property and rights hereby given, granted, bargained, sold,
aliened, enfeoffed, conveyed, confirmed, assigned and/or intended now or
hereafter so to be, on which Assignor may be or may hereafter become bound to
convey or assign to Purchasing Bank, or for carrying out the intention or
facilitating the performance of the terms of this Agreement or for filing,
registering or recording this Agreement.
10. The parties agree that no broker or finder was instrumental in
bringing about this transaction. Each party shall indemnify, defend the other
and hold the other free and harmless from and against any damages, costs or
expenses (including, but not limited to, reasonable attorneys, fees and
disbursements) suffered by such party arising from claims by any broker or
finder that such broker or finder has dealt with said party in connection with
this transaction.
11. Subject to the provisions of Paragraph 12 hereof, if, with
respect to the Purchased Interest only, Assignor shall on or after the Effective
Date receive (a) any cash, note, securities, property, obligations or other
consideration in respect of or relating to the Loan or the Loan Documents or
issued in substitution or replacement Loan or the Loan Documents, (b) any cash
or non-cash consideration in any form whatsoever distributed, paid or issued in
any bankruptcy proceeding in connection with the Loan or the Loan Documents or
(c) any other distribution (whether by means of repayment, redemption,
realization of security or otherwise), Assignor shall accept the same as
Purchasing Bank's agent and hold the same in trust on behalf of and for the
benefit of Purchasing Bank, and shall deliver the same forthwith to Purchasing
Bank in the same form received, with the endorsement (without recourse) of
Assignor when necessary or appropriate. If the Assignor shall fail to deliver
any funds received by it within the same Business Day of receipt, unless such
funds are received by Assignor after 4:00 p.m., Pacific Standard Time, then the
following business day after receipt, said funds shall accrue interest at the
federal funds interest rate and in addition to promptly remitting said amount,
Assignor shall remit such interest from the date received to the date such
amount is remitted to the Purchasing Bank.
12. Assignor and Purchasing Bank each hereby agree to indemnify and
hold harmless the other, each of its directors and each of its officers in
connection with any claim or cause of action based on any matter or claim based
on the acts of either while acting as a Bank under the Credit Agreement.
Promptly after receipt by the indemnified party under this Section of notice of
the commencement of any action, such indemnified party shall notify the
indemnifying party in writing of the commencement thereof. If any such action is
brought against any indemnified party and that party notifies the indemnifying
party of the commencement thereof, the indemnifying party shall be
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entitled to participate therein, and to the extent that it may elect by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof, with counsel
satisfactory to such indemnified party, and after receipt of notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, the indemnifying party will not be liable to such indemnified
party under this Section for any legal or other expenses subsequently incurred
by such indemnified party in connection with the defense thereof. In no event
shall the indemnified party settle or consent to a settlement of such cause of
action or claim without the consent of the indemnifying party.
13. THIS TRANSFER SUPPLEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE
LAWS OF THE STATE OF CALIFORNIA.
Wire Transfer Instructions:
----------------------------------
----------------------------------
----------------------------------
----------------------------------
By:
-------------------------------------
Name:
-----------------------------------
Title
-----------------------------------
By:
-------------------------------------
Name:
-----------------------------------
Title
-----------------------------------
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Receipt and Consent acknowledged this
_________ day of ____________, 199_:
BANK OF AMERICA, NT&SA,
as Administrative Agent
By:
--------------------------------
Name:
---------------------------
Title:
--------------------------
[IF REQUIRED ADD THE
FOLLOWING:]
IRVINE APARTMENT COMMUNITIES, L.P.,
a Delaware limited partnership
By: TIC Acquisition LLC,
a Delaware limited liability company,
Its general partner
By: The Irvine Company,
a Delaware corporation,
Its managing member
By:
-----------------------
[Certifying Officer]
Name:
---------------------
Title:
--------------------
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Exhibit K
EXHIBIT K
REQUEST FOR LETTER OF CREDIT
1. This REQUEST FOR LETTER OF CREDIT is executed and delivered
pursuant to that certain FIRST AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
dated as of June 7, 1999 among IRVINE APARTMENT COMMUNITIES, L.P., a Delaware
limited partnership (the "Borrower"), the banks listed on the signature pages
thereof, BANK OF AMERICA NT&SA, as Administrative Agent, and ▇▇▇▇▇ FARGO BANK,
N.A., as Documentation Agent (as the same may be amended, supplemented,
replaced, renewed or otherwise modified from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used herein with the same
meanings.
2. The Borrower hereby requests that Administrative Agent issue a
Letter of Credit in accordance with the L/C Application accompanying this
request.
3. In connection with the Letter of Credit requested herein, the
Borrower hereby represents, warrants and certifies to the Banks that, as of the
date of the Letter of Credit requested herein, each representation and warranty
made by the Borrower in Article IV of the Credit Agreement will be true and
correct, both immediately before and after such Letter of Credit is issued, as
though such representation and warranty was made on and as of the date of such
issuance. (If the foregoing statement is not true and correct, attach a
statement specifying in detail the circumstances thereof and the actions the
Borrower is taking or proposes to take with respect thereto.)
4. This Request for Letter of Credit is executed on
________________, 19__, by a Certifying Officer of the Borrower on behalf of the
Borrower. The undersigned in such capacity, hereby certifies each and every
matter contained herein to be true and correct.
Dated:
----------------------------------------
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Exhibit L
EXHIBIT L
FORM OF L/C APPLICATION
APPLICATION AND AGREEMENT
FOR STANDBY LETTER OF CREDIT
To: Bank of America National Trust and Savings Association ("Bank")
For Bank Use Only
L/C No. ______________________
A. APPLICATION.
__________________ ("Customer") requests Bank to issue an irrevocable letter of
credit ("Letter of Credit") as follows: [ ] Full text teletransmission [ ]
Airmail with brief preliminary teletransmission advise [ ] Airmail [ ] Courier
For account of (Customer Name and Address)
--------------------------------------------
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--------------------------------------------
Advising Bank
--------------------------------------------
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--------------------------------------------
Amount ( )
--------------------------- ---------
(in words and figures)
Currency
------------------------------------
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--------------------------------------------
--------------------------------------------
In favor of (Beneficiary Name and Address)
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Expiration Date: Drafts to be drawn on and
presented at Bank's issuing
unit on or before:
---------------------------
19__
--------------------------------------------
--------------------------------------------
Available by drafts drawn at sight on Bank's issuing unit when accompanied by
the following documentation
1. The original standby letter of credit.
2. The signed statement of the beneficiary worded as follows (state exact
wording that is to appear in the statement accompanying the draft):
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Special Instructions:
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