LOAN AGREEMENT
Dated: As of December 16, 2005
Among
WRT REALTY L.P., a Delaware
limited partnership
(the "Borrower")
and
KEYBANK, NATIONAL ASSOCIATION ("Agent"),
and
KEYBANK, NATIONAL ASSOCIATION
and any other Lenders, which are, or may become, parties to this Agreement (the
"Lenders")
Up to $100,000,000.00 Credit Facility
--------------------------------------------------------------------------------
KEYBANC CAPITAL MARKETS ("Arranger")
TABLE OF CONTENTS
Page
ARTICLE 1 BACKGROUND...........................................................1
1.1 Defined Terms....................................................1
1.2 Borrower.........................................................1
1.3 Use of Loan Proceeds.............................................1
1.4 Guaranties.......................................................1
1.5 Loan.............................................................2
ARTICLE 2 LOAN PROVISIONS......................................................2
2.1 The Facility/Advances............................................2
2.2 Term of Loan; Extension Rights...................................3
2.3 Interest Rate and Payment Terms..................................3
2.4 Interest Rate....................................................4
2.5 Principal........................................................6
2.6 Fees.............................................................8
2.7 Acceleration.....................................................8
2.8 Conditions to Extending Loan.....................................8
2.9 Increased Costs and Capital Adequacy.............................9
2.10 Borrower Withholding............................................11
2.11 Interest Rate Agreements........................................11
ARTICLE 3 SECURITY FOR THE LOANS; LOAN AND SECURITY DOCUMENTS.................12
3.1 Security for Loan...............................................12
3.2 Loan Documents and Security Documents...........................14
3.3 Additional Borrowing Base Collateral............................14
ARTICLE 4 CONTINUING AUTHORITY OF AUTHORIZED REPRESENTATIVES..................15
4.1 Authorized Representatives......................................15
ARTICLE 5 CONDITIONS PRECEDENT................................................15
5.1 Satisfactory Loan Documents and Related Documents; Loan
Agenda Items....................................................16
5.2 Financial Information; No Material Change.......................16
5.3 Warranties and Representations Accurate.........................16
5.4 Validity and Sufficiency of Security Documents..................17
5.5 Payment Direction And Authorization.............................17
5.6 Litigation......................................................17
5.7 Formation Documents and Entity Agreements.......................18
5.8 Compliance With Law.............................................19
5.9 Compliance With Financial Covenants.............................19
5.10 Due Diligence...................................................19
5.11 Condition of Property...........................................19
5.12 Insurance.......................................................19
5.13 Third Party Consents and Agreements.............................20
5.14 Legal Opinions..................................................20
5.15 No Default......................................................20
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ARTICLE 6 WARRANTIES AND REPRESENTATIONS......................................20
6.1 Formation.......................................................20
6.2 Proceedings; Enforceability.....................................20
6.3 Conflicts.......................................................21
6.4 Ownership and Taxpayer Identification Numbers...................21
6.5 Litigation......................................................22
6.6 Information.....................................................22
6.7 Taxes...........................................................22
6.8 Financial Information...........................................22
6.9 Management Agreements...........................................22
6.10 Control Provisions..............................................22
6.11 Formation Documents.............................................23
6.12 Related Documents...............................................23
6.13 Bankruptcy Filings..............................................23
6.14 Options.........................................................23
6.15 Investment Company..............................................23
6.16 Holding Company.................................................23
6.17 Individual Properties...........................................24
6.18 Use of Proceeds.................................................26
6.19 Insurance.......................................................26
6.20 Deferred Compensation and ERISA.................................26
6.21 No Default......................................................26
6.22 Other Loan Parties' Warranties and Representations..............26
ARTICLE 7 AFFIRMATIVE COVENANTS...............................................26
7.1 Notices.........................................................26
7.2 Financial Statements; Reports; Officer's Certificates...........27
7.3 Existence.......................................................30
7.4 Payment of Taxes................................................30
7.5 Insurance; Casualty, Taking.....................................30
7.6 Inspection......................................................31
7.7 Loan Documents..................................................31
7.8 Further Assurances..............................................31
7.9 Books and Records...............................................31
7.10 Business and Operations.........................................32
7.11 Title...........................................................32
7.12 Estoppel........................................................32
7.13 ERISA...........................................................32
7.14 Depository Accounts.............................................33
7.15 Cash Flow; Payment Direction Letters............................34
7.16 Distributions...................................................34
7.17 Costs and Expenses..............................................35
7.18 Appraisals......................................................35
7.19 Indemnification.................................................35
7.20 RESERVED........................................................36
7.21 Future Collateral Obligations...................................36
7.22 Replacement Documentation.......................................37
7.23 Other Covenants.................................................37
7.24 Related Documents...............................................37
7.25 Reserved........................................................38
7.26 Financial Covenants.............................................38
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ARTICLE 8 NEGATIVE COVENANTS..................................................41
8.1 No Changes to the Borrower and other Loan Parties...............42
8.2 Restrictions on Liens...........................................42
8.3 Consolidations, Mergers, Sales of Assets, Issuance and
Sale of Equity..................................................43
8.4 Restrictions on Debt............................................44
8.5 Respecting Individual Properties................................45
8.6 Other Business..................................................45
8.7 Change of Control...............................................45
8.8 Forgiveness of Debt.............................................45
8.9 Affiliate Transactions..........................................45
8.10 Amendments; Terminations of Related Documents...................45
8.11 ERISA...........................................................45
8.12 Bankruptcy Filings..............................................45
8.13 Investment Company..............................................45
8.14 Holding Company.................................................46
8.15 Use of Proceeds.................................................46
8.16 Distributions...................................................46
8.17 Restrictions on Investments.....................................46
8.18 Contracts of a Material or Significant Nature...................47
8.19 Negative Pledges, Etc...........................................47
8.20 Business Transactions...........................................47
8.21 ▇▇▇▇▇▇▇ Pledged Securities......................................47
ARTICLE 9 SPECIAL PROVISIONS..................................................47
9.1 Legal Requirements..............................................47
9.2 Distributions...................................................48
9.3 Limited Recourse Provisions.....................................48
9.4 Payment of Obligations..........................................49
ARTICLE 10 EVENTS OF DEFAULT..................................................49
10.1 Default and Events of Default...................................49
10.2 Grace Periods and Notice........................................52
ARTICLE 11 REMEDIES...........................................................53
11.1 Remedies........................................................53
11.2 Written Waivers.................................................54
11.3 Power of Attorney...............................................54
ARTICLE 12 SECURITY INTEREST AND SET-OFF......................................54
12.1 Security Interest...............................................54
12.2 Set-Off.........................................................54
12.3 Application.....................................................55
12.4 Right to Freeze.................................................55
12.5 Additional Rights...............................................55
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ARTICLE 13 THE AGENT AND THE LENDERS..........................................56
13.1 Appointment.....................................................56
13.2 Reliance on Agent...............................................56
13.3 Powers..........................................................56
13.4 Disbursements...................................................57
13.5 Distribution and Apportionment of Payments......................58
13.6 Agency Provisions Relating to Collateral........................60
13.7 Lender Actions Against Borrower or the Collateral...............62
13.8 Assignment and Participation....................................62
13.9 Ratable Sharing.................................................62
13.10 General Immunity................................................62
13.11 No Responsibility for Loan, Recitals, Etc.......................63
13.12 Action on Instructions of Lenders...............................63
13.13 Employment of Agents and Counsel................................63
13.14 Reliance on Documents; Counsel..................................63
13.15 Agent' Reimbursement and Indemnification........................63
13.16 Rights as a Lender..............................................64
13.17 Lenders' Credit Decisions.......................................64
13.18 Notice of Events of Default.....................................64
13.19 Successor Agent.................................................64
13.20 Distribution by Agent...........................................65
13.21 Holders.........................................................65
13.22 Assignment and Participation....................................66
13.23 Several Liability...............................................69
13.24 Miscellaneous Assignment Provisions.............................69
13.25 Assignment by Borrower..........................................69
13.26 Consents and Approvals..........................................70
13.27 Lead Arranger...................................................72
ARTICLE 14 GENERAL PROVISIONS.................................................72
14.1 Notices.........................................................72
14.2 Limitations on Assignment.......................................74
14.3 Further Assurances..............................................74
14.4 Payments........................................................74
14.5 Parties Bound...................................................74
14.6 Governing Law; Consent to Jurisdiction; Mutual Waiver of
Jury Trial......................................................74
14.7 Survival........................................................75
14.8 Cumulative Rights...............................................76
14.9 Claims Against Agent or Lenders.................................76
14.10 Regarding Consents..............................................77
14.11 Obligations Absolute............................................77
14.12 Table of Contents, Title and Headings...........................77
14.13 Counterparts....................................................77
14.14 Satisfaction of Commitment......................................77
14.15 Time Of the Essence.............................................77
14.16 No Oral Change..................................................77
14.17 Monthly Statements..............................................78
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EXHIBITS
Exhibit A -- Definitions
Exhibit B -- Form of Assignment and Assumption Agreement
Exhibit C -- Form of Note
Exhibit D -- Authorized Representatives
Exhibit E -- Required Property, Hazard and Other Insurance
Exhibit F -- Ownership Interests and Taxpayer Identification Numbers
Exhibit G-1 -- Form of Compliance Certificate
Exhibit G-2 -- Form of Financial Covenant Compliance Certificate
Exhibit H -- Form of Notice of Rate Selection
Exhibit I -- Lenders' Commitments
Exhibit K -- Loan Agenda
Exhibit L -- Reserved
Exhibit M -- Borrower Subsidiaries
Exhibit N -- Pledged Securities
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SCHEDULES
Schedule 6.4..................................................................21
Schedule 6.5..................................................................22
Schedule 6.9..................................................................22
Schedule 6.10.................................................................23
Schedule 6.17.3...............................................................24
Schedule 6.17.4...............................................................22
Schedule 6.17.5...............................................................25
Schedule 6.17.7...............................................................25
Schedule 8.4.2(b).............................................................44
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LOAN AGREEMENT
This agreement ("Loan Agreement" or "Agreement") is made and entered into
as of the 16th day of December, 2005, by and between WRT REALTY L.P., a Delaware
limited partnership having an address of ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇.▇. ▇▇▇
▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the "Borrower"), KEYBANK NATIONAL
ASSOCIATION, a national banking association, having an address at ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, and the other lending
institutions which are, or may become, parties to this Agreement pursuant to
Section 13.22 (singly and collectively, the "Lenders"), KEYBANK NATIONAL
ASSOCIATION, a national banking association, with a place of business at ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, as Agent for itself and such other lending
institutions (the "Agent"), and KEYBANC CAPITAL MARKETS, as the Arranger.
WITNESSETH:
ARTICLE 1
BACKGROUND.
1.1 Defined Terms
Capitalized terms used in this Agreement are defined either in Exhibit A,
or in specific sections of this Agreement, or in another Loan Document, as
referenced in Exhibit A.
1.2 Borrower
The Borrower is a limited partnership organized under the laws of the
State of Delaware. Winthrop Realty Trust, an Ohio business trust (the "REIT"),
is the holder of 100% of the preferred units and 99.8% of the common units in
the Borrower, and WRT TRS Management Corp. ("Management") is the holder of .2%
of the common units in the Borrower.
1.3 Use of Loan Proceeds
The Borrower has applied to Lenders for a revolving loan facility (the
"Facility") of up to ONE HUNDRED MILLION DOLLARS ($100,000,000.00), with an
initial commitment of FIFTY MILLION DOLLARS ($50,000,000.00) (each advance under
the Facility being a "Loan" and collectively, the "Loans"), the proceeds of
which are to be used to provide funding for the working capital of the Borrower
and its Subsidiaries.
1.4 Guaranties
As an inducement to Lenders to make the Loans, the following entities have
agreed to furnish certain guaranties and indemnities to the Agent with respect
to the Loan (the following, in such capacity, are severally and collectively
called "Guarantor"): (i) REIT, (ii) WRT TRS Management Corp., a Delaware
corporation and a wholly owned subsidiary of REIT, and (iii) the following
wholly owned subsidiaries of the Borrower (each, a "Subsidiary Guarantor"):
FT-Westside Loan Participation LLC, WRT-Springing Member LLC, FT-Clearwater Loan
LLC, FT-5400 Westheimer LLC, FT-5400 New Unit Lender LLC, FT-MARC Loan LLC, and
FT-MARC Class B LLC (all Delaware limited liability companies).
1.5 Loan.
Subject to all of the terms, conditions and provisions of this Agreement,
and of the agreements and instruments referred to herein, each of the Lenders
agrees severally to make Loans to the Borrower under the Facility up to the
amount such Lender's Commitment, and the Borrower agrees to accept and repay the
Loans.
ARTICLE 2
LOAN PROVISIONS.
2.1 The Facility/Advances.
2.1.1 Subject to Section 2.1.2, in no event shall the aggregate
amount of Loans outstanding from time to time exceed the lesser of (a) the
Facility Amount or (b) the Borrowing Base (the lesser of (a) or (b) being
the "Availability").
2.1.2 Provided no Default or Event of Default shall then be in
existence (or would be after giving effect thereto), the Borrower shall
have the right prior to September 16, 2008, to elect to further increase
the Facility Amount and obtain Loans (subject in all instances to the
terms and conditions of this Agreement) from the Lenders in the amount of
such increase; provided, however, that (i) the total of such increases
shall not be in excess of Fifty Million Dollars ($50,000,000.00) in the
aggregate, (ii) such increases shall be approved by the Agent, such
approval not to be unreasonably withheld, (iii) each such increase shall
be in a minimum amount of $10,000,000.00, (iv) after any such increase the
Facility Amount shall not exceed the Total Commitments of the Lenders (as
such may be increased after the date hereof) as determined by the Agent,
and (v) the Borrower pays the commitment fee on such increase set forth in
the addendum to the Agent's terms letter. Such right may be exercised by
the Borrower by written notice to the Agent (which the Agent will forward
promptly to the Lenders), which election shall designate the increased
Facility Amount. The Borrower shall execute and deliver any and all
documentation and satisfy other conditions reasonably required by the
Agent in order to evidence and effectuate the increase in the Facility
Amount, including, without limitation, any new or replacement Note(s) as
may be required by any Lender changing its Commitment or any new Lender
issuing a new Commitment, and payment of any commitment fee by the
Borrower as may be required by the Agent in connection with such increase.
Any such increase of the Facility Amount shall not be effective until
written confirmation from the Agent to the Borrower and the Lenders of
such increased amount and the confirmation that such amount does not
exceed the Total Commitments of the Lenders. The Borrower acknowledge and
agree that neither Agent nor any Lender has agreed to increase its
Commitment to provide funding for such increased Facility Amount, and that
2
any such agreement by Agent or any Lender shall be in its sole discretion.
The Arranger agrees to exercise reasonable best efforts to secure such
additional commitments if so requested by Borrower. The Arranger shall
give the existing Lenders written notice of the Borrower's request to so
increase the Facility Amount hereunder, and the existing Lenders shall
have a right of first refusal with respect to electing to increase their
respective Commitments, which right must be exercised by providing the
Agent with written notice of such election within ten (10) Business Days
of the notice provided by the Arranger. In the event the existing Lenders
shall agree to increase their Commitments by an amount that is in excess
of the requested increase, such increased Commitments shall be allocated
by the Agent on a pro rata basis. In connection with any increase in the
Facility Amount, (a) no Lender shall be required to increase the amount of
such Lender's Commitment, and (b) each existing Lender's respective
Percentage shall be adjusted to reflect the participation of the new
Lender (or existing Lender increasing its Commitment) in the Facility and
the increase in the Total Commitment.
2.1.3 Any and all advances of proceeds of the Loans shall be made by
the Lenders pro rata in accordance with each Lender's Percentage. Loans
may be prepaid and reborrowed in accordance with the provisions hereof,
provided the aggregate principal amount of Loans outstanding from any
Lender shall not exceed at any one time such Bank's Commitment.
2.1.4 The aggregate principal amount of each Borrowing of Loans
hereunder shall be not less than One Million Dollars ($1,000,000.00) for
Adjusted Prime Rate Loans, and Five Million Dollars ($5,000,000.00) for
LIBOR Rate Loans, or in greater integral multiples of One Million Dollars
($1,000,000.00) thereafter.
2.1.5 The obligations of the Lenders hereunder are several and not
joint. Failure of any Lender to fulfill its obligations hereunder shall
not result in any other Lender becoming obligated to advance more than its
Percentage of any Loan, nor shall such failure release or diminish the
obligations of any other Lender to fund its Percentage provided herein.
2.1.6 Each request for a Loan hereunder shall constitute a
representation and warranty by Borrower that the conditions set forth in
ARTICLE 5 hereof, as the case may be, have been satisfied on the date of
such request and will be satisfied on the proposed drawdown date, unless
otherwise disclosed in writing to the Agent prior to or at the time of
such request, including the Borrower's continued compliance with the
Financial Covenants, except to the extent the contemplated Loan will
result in noncompliance with the Financial Covenants. Notwithstanding any
such disclosure, the disclosure by Borrower to Agent that one or more of
the conditions set forth in ARTICLE 5 hereof are not satisfied as of the
date of Borrower's request for a Loan or will not be satisfied as of the
proposed Drawdown Date shall entitle Agent to refuse to make the Loan
requested by Borrower
2.2 Term of Loan; Extension Rights
The Facility shall be for a term ("Initial Term") commencing on the date
hereof and ending on December 16, 2008 ("Initial Maturity Date"). The Initial
Term of the Facility may be extended for one (1) year ("Extended Term") until
December 16, 2009 ("Extended Maturity Date") upon satisfaction of the conditions
set forth in Section 2.8.
2.3 Interest Rate and Payment Terms
The Loans shall be payable as to interest and principal in accordance with
the provisions of this Agreement and the Note. This Agreement also provides for
interest at a Default Rate, Late Charges and prepayment rights and fees. All
payments for the account of Lenders made by the Borrower shall be applied to the
respective accounts of the Lenders in accordance with each Lender's Percentage
of the Loan. The Agent will disburse such payments to the Lenders on the date of
3
receipt thereof if received prior to 10:00 a.m. on such date and, if not, on the
next Business Day. Any and all interest rate selection and conversion provisions
in this Agreement are to be administered by the Agent and to be allocated on a
pro rata basis to the portion of the balance due under the Notes held by each
Lender based upon such Lender's Percentage.
2.4 Interest Rate.
2.4.1 The Loans will bear interest at the Applicable Rate, unless
the Default Rate is applicable. The Adjusted Prime Rate shall be the
"Applicable Rate", except that the Adjusted LIBOR Rate shall be the
"Applicable Rate" with respect to portions of the Loans as to which a
LIBOR Rate Option is then in effect. For each disbursement of proceeds of
the Loan, Borrower shall deliver to Agent irrevocable notice (which may be
verbal notice provided that Borrower delivers to Agent facsimile
confirmation or electronic mail confirmation within twenty four (24) hours
of such verbal notice) of the requested amount of such disbursement (x) if
such disbursement is to bear interest at the Adjusted Prime Rate, not
later than 11:00 a.m. Eastern Time on the second Business Day prior to the
desired date of disbursement and (y) if such disbursement is to bear
interest at an Adjusted LIBOR Rate, not later than 11:00 a.m. Eastern Time
on the third Business Day prior to the desired date of disbursement.
Commencing February 1, 2006, Borrower shall pay interest in arrears on the
first day of every calendar month in the amount of all interest accrued
and unpaid on the Loan. All payments (whether of principal or of interest)
shall be deemed credited to Borrower's account only if received by 12:00
noon Eastern Time on a Business Day; otherwise, such payment shall be
deemed received on the next Business Day.
2.4.2 Provided that no Event of Default exists, Borrower shall have
the option (the "LIBOR Rate Option") to elect from time to time in the
manner and subject to the conditions hereinafter set forth an Adjusted
LIBOR Rate as the Applicable Rate for all or any portion of a Loan which
would otherwise bear interest at the Adjusted Prime Rate.
2.4.3 The only manner in which Borrower may exercise the LIBOR Rate
Option is by giving Agent irrevocable notice (which may be verbal notice
provided that Borrower delivers to Agent facsimile or email confirmation
in the form of Exhibit H attached hereto within twenty-four (24) hours) of
such exercise not later than 11:00 a.m. Eastern Time on the second LIBOR
Business Day prior to the proposed commencement of the relevant LIBOR Rate
Interest Period, which written notice shall specify: (i) the portion of
the Loans with respect to which Borrower is electing the LIBOR Rate
Option, (ii) the LIBOR Business Day upon which the applicable LIBOR Rate
Interest Period is to commence and (iii) the duration of the applicable
LIBOR Rate Interest Period. The Applicable Rate for any portion of the
Loans with respect to which Borrower has elected the LIBOR Rate Option
shall revert to the Adjusted LIBOR Rate with a LIBOR Rate Interest Period
of one-month (the "One-Month LIBOR Rate"), as of the last day of the LIBOR
Rate Interest Period applicable thereto (unless Borrower again exercises
the LIBOR Rate Option for such portion of the Loan). Agent shall be under
no duty to notify Borrower that the Applicable Rate on any portion of the
Loan is about to revert from an Adjusted LIBOR Rate to the One-Month LIBOR
Rate. The LIBOR Rate Option may be exercised by Borrower only with respect
to any portion of the Loans equal to or in excess of $500,000.00. At no
time may there be more than six (6) LIBOR Rate Interest Periods in effect
with respect to the Loan.
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2.4.4 If Agent determines (which determination shall be conclusive
and binding upon Borrower, absent manifest error) (i) that Dollar deposits
in an amount approximately equal to the portion of the Loans for which
Borrower has exercised the LIBOR Rate Option for the designated LIBOR Rate
Interest Period are not generally available at such time in the London
interbank market for deposits in Dollars, (ii) that the rate at which such
deposits are being offered will not adequately and fairly reflect the cost
to any Lender of maintaining a LIBOR Rate on such portion of the Loans or
of funding the same for such LIBOR Rate Interest Period due to
circumstances affecting the London interbank market generally, (iii) that
reasonable means do not exist for ascertaining a LIBOR Rate, or (iv) that
an Adjusted LIBOR Rate would be in excess of the maximum interest rate
which Borrower may by law pay, then, in any such event, to the extent that
such Lender makes such determination generally with respect to its
Borrower who borrow funds at a rate based upon the LIBOR Rate, Agent shall
so notify Borrower and all portions of the Loans bearing interest at an
Adjusted LIBOR Rate that are so affected shall, as of the date of such
notification with respect to an event described in clause (ii) or (iv)
above, or as of the expiration of the applicable LIBOR Rate Interest
Period with respect to an event described in clause (i) or (iii) above,
bear interest at the Adjusted Prime Rate until such time as the situations
described above are no longer in effect or can be avoided by Borrower
exercising a LIBOR Rate Option for a different LIBOR Rate Interest Period.
2.4.5 Interest at the Applicable Rate (or Default Rate) shall be
calculated for the actual number of days elapsed on the basis of a 360-day
year, including the first date of the applicable period to, but not
including, the date of repayment.
2.4.6 Borrower shall pay all Breakage Costs incurred from time to
time by Lender upon demand within fifteen (15) Business Days of receipt of
written notice from Agent.
2.4.7 If the introduction of or any change in any law, regulation or
treaty, or in the interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof, shall make it
unlawful for any Lender to maintain the Applicable Rate at an Adjusted
LIBOR Rate with respect to the Loans or any portion thereof, or to fund
the Loans or any portion thereof in Dollars in the London interbank
market, or to give effect to its obligations regarding the LIBOR Rate
Option as contemplated by the Loan Documents, then, to the extent that
such Lender makes such determination generally with respect to its
Borrower who borrow funds at a rate based upon the LIBOR Rate, (1) Agent
shall notify Borrower that such Lender is no longer able to maintain the
Applicable Rate at an Adjusted LIBOR Rate, (2) the LIBOR Rate Option shall
immediately terminate, (3) the Applicable Rate for any portion of the
Loans for which the Applicable Rate is then an Adjusted LIBOR Rate shall
automatically be converted to the Adjusted Prime Rate, and (4) Borrower
shall pay to Agent the amount of Breakage Costs (if any) incurred by such
Lender in connection with such conversion. Thereafter, Borrower shall not
be entitled to exercise the LIBOR Rate Option until such time as the
situation described herein is no longer in effect or can be avoided by
Borrower exercising a LIBOR Rate Option for a different LIBOR Rate
5
Interest Period. So long as no Event of Default has occurred and is
continuing, upon written demand of Borrower, the Borrower may with thirty
(30) days written notice to the Agent, require any such Lender unable to
maintain the Applicable Rate at an Adjusted LIBOR Rate pursuant to this
Section 2.4.7 to sell and assign its entire interest in the Loans pursuant
to Section 13.22 hereof to any Eligible Assignee identified by the
Borrower in its demand and reasonably approved by the Agent, upon payment
by such Eligible Assignee of the entire par amount of such Lender's
interest in the Loan, plus any applicable Breakage Costs.
2.5 Principal.
2.5.1 Scheduled Payments. No scheduled payments of principal shall
be due prior to the Maturity Date.
(a) Mandatory Principal Repayments. The Borrower shall make
mandatory prepayments of principal equal to the excess of the
outstanding balance of the Facility, over the Availability, as
determined by the Agent from time to time (singly and collectively,
the "Mandatory Principal Prepayments") each of which shall be due
and payable on the later of (x) within five (5) Business Days of the
event giving rise to such Mandatory Principal Prepayment obligation
(the "Mandatory Prepayment Event") or (y) within three (3) Business
Days of written demand therefor by the Agent; provided, however, at
the request of the Borrower, the Agent agrees to hold the amount of
any such Mandatory Principal Prepayment in the Mandatory Principal
Payment Account (as defined in the Cash Management Agreement,
pledged to the Agent, on behalf of the Lenders, to secure the
repayment of the Obligations), until the earlier of (x) the
expiration of any relevant Interest Period so that the prepayment
can be made without the Borrower incurring any costs under Section
2.5.7 or (y) ninety (90) days:
Any Mandatory Principal Prepayment shall be applied to then
outstanding principal balance due under the Loan.
(b) Prepayment. Notwithstanding anything to the contrary
contained in this Agreement or any of the other Loan Documents to
the contrary, the Loans or any portion thereof may be prepaid in
whole or in part by the Borrower on any Business Day during the term
of the Loan, upon five (5) days' prior written notice to the Agent.
Any prepayment made pursuant to the foregoing shall be accompanied
by the payment of interest accrued through the date of prepayment
and the payment of any applicable Breakage Costs.
2.5.2 Maturity. At maturity all accrued interest, principal and
other charges due with respect to the Loans shall be due and payable in
full and the principal balance and such other charges, but not unpaid
interest, shall bear interest at the Default Rate until so paid.
2.5.3 Method of Payment; Date of Credit. All payments of interest,
principal and fees shall be made in lawful money of the United States in
immediately available funds, without counterclaim or set off and free and
clear, and without any deduction or withholding for, any taxes (other than
income taxes or franchise taxes of any Lender) or other payments (a) by
direct charge to an account of Borrower maintained with Agent (or then
holder of the Loan), or (b) by wire transfer to Agent or to such other
bank or address as the holder of the Loans may designate in a written
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notice to Borrower. Payments shall be credited on the Business Day on
which immediately available funds are received prior to 12:00 noon
Cleveland Time; payments received after 12:00 noon Eastern Time shall be
credited to the Loans on the next Business Day; payments which are by
check, which Agent may at its option accept or reject, or which are not in
the form of immediately available funds shall not be credited to the Loans
until such funds become immediately available to Agent, and, with respect
to payments by check, such credit shall be provisional until the item is
finally paid by the payer bank.
2.5.4 ▇▇▇▇▇▇▇▇. Agent may submit monthly ▇▇▇▇▇▇▇▇ reflecting
payments due from the Borrower; however, any changes in the interest rate
which occur between the date of billing and the due date may be reflected
in the billing for a subsequent month. Neither the failure of Agent to
submit a billing nor any error in any such billing shall excuse the
Borrower from the obligation to make full payment of the Borrower's
payment obligations when due.
2.5.5 Default Rate. Agent shall have the option of imposing (and
shall upon demand of the Required Lenders impose), and Borrower shall pay
upon billing therefor, an interest rate which is three percent (3%) per
annum above the interest rate otherwise payable ("Default Rate"): (a)
following any Event of Default, unless and until the Event of Default is
cured with the consent of Required Lenders or waived by Required Lenders;
and (b) after Maturity. Borrower's right to select LIBOR pricing options
shall be suspended upon the occurrence and during the continuance of a
monetary Default or following any Event of Default or at Maturity.
2.5.6 Late Charges. The Borrower shall pay, upon billing therefor, a
"Late Charge" equal to five percent (5%) of the amount of any regularly
scheduled payment of principal (other than principal due at Maturity or
any Mandatory Principal Prepayment), interest, or both, which is not paid
within ten (10) days of the due date thereof (other than with respect to
any payment as to which the said ten (10) day period expires after the
implementation of the Default Rate). Late charges are: (a) except as
provided above, payable in addition to, and not in limitation of, the
Default Rate, (b) intended to compensate Agent for administrative and
processing costs incident to late payments, (c) are not interest, and (d)
shall not be subject to refund or rebate or credited against any other
amount due.
2.5.7 Prepayment Costs. The Borrower shall pay to Agent, immediately
upon request and notwithstanding contrary provisions contained in any of
the Loan Documents, such amounts as shall, in the conclusive judgment of
Agent (in the absence of manifest error), compensate Agent and the Lenders
for the loss, cost or expense which they may reasonably incur as a result
of (i) any payment or prepayment, under any circumstances whatsoever,
whether voluntary or involuntary, of all or any portion of an Adjusted
LIBOR Rate Advance on a date other than the last day of the applicable
Interest Period of an Adjusted LIBOR Rate Advance, (ii) the conversion,
for any reason whatsoever, whether voluntary or involuntary, of any
Adjusted LIBOR Rate Advance to a Adjusted Prime Rate Advance on a date
other than the last day of the applicable Interest Period, (iii) the
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failure of all or a portion of a Loan which was to have borne interest at
the Adjusted LIBOR Rate pursuant to the request of Borrower to be made
under the Loan Agreement (except as a result of a failure by any Lender to
fulfill such Lender's obligations to fund), or (iv) the failure of the
Borrower to borrow in accordance with any request submitted by it for an
Adjusted LIBOR Rate Advance. Such amounts payable by the subject Borrower
shall be equal to (a) any administrative costs actually incurred plus (b)
the Breakage Costs.
2.6 Fees.
2.6.1 Loan Fees. Borrower shall pay to the Agent the fees as and
when provided in the addendum to the terms letter between the Borrower and
the Agent. The fee shall be based upon the amount of the Total Commitment
and shall be fully earned by the Agent on the Closing Date.
2.6.2 Unused Commitment Fee. The Borrower agree to pay to the Agent
for distribution to each Lender an unused commitment fee (the "Unused
Commitment Fee") for the period from the Closing Date until the Maturity
Date (or such earlier date as the Total Commitment shall have been
terminated) equal to the average daily amount of the Total Commitment then
in effect which was unused (through the extension of Loans) during the
immediately preceding calendar quarter calculated on the basis of actual
days elapsed over the actual number of days for such quarter, multiplied
by (a) if the average daily utilization of the Total Commitment is less
than or equal to fifty percent (50%), twenty five basis points (.25%), or
(b) if the average daily utilization of the Total Commitment is greater
than fifty percent (50%), fifteen basis points (.15%). The Unused
Commitment Fee shall be due and payable quarterly in arrears on the first
day of each quarter and on the Maturity Date or upon such earlier date as
the Total Commitment shall be terminated
2.6.3 Extension Fees. The Borrower shall pay to the Agent for the
account of the Lenders "Extension Fees" (so referred to herein) in amounts
representing one quarter of one percent (0.25%) of the Total Commitment of
the Lenders at the Initial Maturity Date, in connection with the
Borrower's exercise of its extension right, and as a condition precedent
to the effectiveness thereof, in each instance, as provided in Section
2.8. In the event the Facility is not extended for any reason, the Agent
shall promptly return the Extension Fee to the Borrower.
2.7 Acceleration
The Agent may, and upon the request of the Required Lenders shall,
accelerate the applicable Loan, after the occurrence and during the continuance
of an Event of Default. Upon such an acceleration, all principal, accrued
interest and costs and expenses shall be due and payable together with interest
on such principal at the Default Rate and any applicable Prepayment Fee and any
amounts due under Section 2.5.7.
2.8 Conditions to Extending Loan
Upon satisfaction of each of the following conditions, the Borrower may
extend the Facility until the Extended Maturity Date:
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2.8.1 No Default. No Default shall exist on the date of the
Borrower's written notice for an extension as provided for below and on
the Initial Maturity Date.
2.8.2 Notice From Borrower. The Borrower shall have given Agent
written notice of its request to exercise its extension right at least
forty-five (45) days, but no more than ninety (90) days, before the
Initial Maturity Date.
2.8.3 Covenant Compliance. No breach of any covenants imposed upon
the Borrower shall exist including, without limitation, the Financial
Covenants;
2.8.4 Conditions Satisfied. All of the conditions set forth in
ARTICLE 5 of this Agreement shall continue to be satisfied;
2.8.5 Extension Fee. The Extension Fee of 0.25% of the Facility
referred to in Section 2.6.3 shall have been paid at least five (5) days
prior to the Initial Maturity Date;
2.8.6 Additional Documents. The Borrower and each Guarantor shall
have executed and delivered to Agent such agreements and documents as
Agent may reasonably require to effectuate the extension; provided,
however, none of said requested agreements or documents shall provide for
additional collateral or include any substantive modification of the terms
and provisions of the Loan Documents;
2.8.7 Before End of Term. Each of the foregoing conditions are
satisfied not later than, and on, the Initial Maturity Date.
Within twenty (20) days following receipt by Agent of Borrower's
written notice under clause 2.8.2 above requesting the extension
accompanied by the items described in Section 2.8, Agent shall notify the
Borrower in writing if all of the conditions precedent to the extension,
other than payment of the extension fee, have been satisfied, or if
further information or documents set forth in Section 2.8 are required,
specifying such missing information or documents. If Agent determines that
the conditions to extension have been satisfied (or if the Agent notified
the Borrower as provided above of any outstanding information or documents
required by this Section 2.8, specifying such missing information or
documents, and the Borrower provides outstanding information or documents
prior to ten (10) days before the Initial Maturity Date), other than
payment of the Extension Fee, Agent shall so notify the Borrower and upon
Agent's receipt of the Extension Fee not later than five (5) days prior to
the Initial Maturity Date, so long as no Default exists, the term of the
Facility shall be extended until the Extended Maturity Date.
2.9 Increased Costs and Capital Adequacy.
2.9.1 Borrower recognizes that the cost to any Lender of maintaining
the Loans or any portion thereof may fluctuate and, to the extent that
such Lender makes such determination generally with respect to similarly
situated borrowers, Borrower agrees to pay Agent additional amounts to
compensate any such Lender for any increase in its actual costs incurred
in maintaining the Loans or any portion thereof outstanding or for the
reduction of any amounts received or receivable from Borrower as a result
of:
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(a) any change after the date hereof in any applicable law,
regulation or treaty, or in the interpretation or administration
thereof, or by any domestic or foreign court, (A) changing the basis
of taxation of payments under this Agreement to any Lender (other
than taxes imposed on all or any portion of the overall net income
or receipts of Lenders or franchise taxes), or (B) imposing,
modifying or applying any reserve, special deposit or similar
requirement against assets of, deposits with or for the account of,
credit extended by, or any other acquisition of funds for loans by
any Lender (which includes the Loans or any applicable portion
thereof) (provided, however, that Borrower shall not be charged
again the Reserve Percentage already accounted for in the definition
of the Adjusted LIBOR Rate), or (C) imposing on any Lender, or the
London interbank market generally, any other condition affecting the
Loan, provided that the result of the foregoing is to increase the
cost to any Lender of maintaining the Loans or any portion thereof
or to reduce the amount of any sum received or receivable from
Borrower by any Lender under the Loan Documents; or
(b) the maintenance by any Lender of reserves in accordance
with reserve requirements promulgated by the Board of Governors of
the Federal Reserve System of the United States with respect to
"Eurocurrency Liabilities" of a similar term to that of the
applicable portion of the Loans (without duplication for reserves
already accounted for in the calculation of a LIBOR Rate pursuant to
the terms hereof).
So long as no Event of Default has occurred and is continuing, upon written
demand of Borrower, the Borrower may with thirty (30) days' written notice to
the Agent, require any such Lender whose costs of maintaining the Loans or any
portion thereof has increased as provided for in this Section 2.9.1 to sell and
assign its entire interest in the Loans pursuant to Section 13.22 hereof to any
Eligible Assignee identified by the Borrower in its demand and reasonably
approved by the Agent, upon payment by such Eligible Assignee of the entire par
amount of such Lender's interest in the Loan, plus any compensation required to
be paid hereunder and any applicable Breakage Costs.
2.9.2 If the application of any law, rule, regulation or guideline
adopted or arising out of the report of the Basle Committee on Banking
Regulations and Supervisory Practices entitled "International Convergence
of Capital Measurement and Capital Standards", or the adoption after the
date hereof of any other law, rule, regulation or guideline regarding
capital adequacy, or any change after the date hereof in any of the
foregoing, or in the interpretation or administration thereof by any
domestic or foreign Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or
compliance by any Lender, with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has the effect of reducing the rate of
return on such Lender's capital to a level below that which such Lender
would have achieved but for such application, adoption, change or
compliance (taking into consideration the policies of such Lender with
respect to capital adequacy), then, to the extent that such Lender
requires such compensation generally with respect to similarly situated
Borrower, from time to time Borrower shall pay to such Lender such
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additional amounts as will compensate such Lender for such reduction with
respect to any portion of the Loans outstanding. So long as no Event of
Default has occurred and is continuing, upon written demand of Borrower,
the Borrower may with thirty (30) days written notice to the Agent,
require any such Lender to whom compensation is due and payable by the
Borrower as provided for in this Section 2.9.2 to sell and assign its
entire interest in the Loans pursuant to Section 13.22 hereof to any
Eligible Assignee identified by the Borrower in its demand and reasonably
approved by the Agent, upon payment by such Eligible Assignee of the
entire par amount of such Lender's interest in the Loan, plus any
compensation required to be paid hereunder and any applicable Breakage
Costs.
2.9.3 Any amount payable by Borrower under subsection 2.9.1 or 2.9.2
above shall be paid within five (5) days of receipt by Borrower of a
certificate signed by an authorized officer of Agent setting forth the
amount due and the basis for the determination of such amount, which
statement shall be conclusive and binding upon Borrower, absent manifest
error. Failure on the part of Agent to demand payment from Borrower for
any such amount attributable to any particular period shall not constitute
a waiver of Lender's right to demand payment of such amount for any
subsequent or prior period. Agent shall use reasonable efforts to deliver
to Borrower prompt notice of any event described in subsection 2.9.1 or
2.9.2 above, of the amount of the reserve and capital adequacy payments
resulting therefrom and the reasons therefor and of the basis of
calculation of such amount; provided, however, that any failure by Agent
so to notify Borrower shall not affect Borrower's obligation to pay the
reserve and capital adequacy payment resulting therefrom.
2.10 Borrower Withholding
If by reason of a change in any applicable laws occurring after the date
hereof, or, as to an Eligible Assignee acquiring an interest in the Loans after
the date hereof, after such Eligible Assignee purchases such interest in the
Loan, Borrower is required by law to make any deduction or withholding in
respect of any taxes (other than taxes imposed on or measured by the net income
of any Lender or any franchise tax imposed on any Lender), duties or other
charges from any payment due under the Note to the maximum extent permitted by
law, to the extent that such Lender imposes such requirement generally with
respect to similarly situated Borrower, the sum due from Borrower in respect of
such payment shall be increased to the extent necessary to ensure that, after
the making of such deduction or withholding, each Lender receives and retains a
net sum equal to the sum which it would have received had no such deduction or
withholding been required to be made. So long as no Event of Default has
occurred and is continuing, upon written demand of Borrower, the Borrower may
with thirty (30) days written notice to the Agent, require any such Lender
requiring the Borrower to make such deductions or withholdings as set forth in
this Section 2.10 to sell and assign its entire interest in the Loans pursuant
to Section 13.22 hereof to any Eligible Assignee identified by the Borrower in
its demand and reasonably approved by the Agent, upon payment by such Eligible
Assignee of the entire par amount of such Lender's interest in the Loan, plus
any amounts required to be paid hereunder and any applicable Breakage Costs.
2.11 Interest Rate Agreements.
2.11.1 Any indebtedness incurred pursuant to an Interest Rate
Agreement entered into by Borrower and Agent shall constitute indebtedness
evidenced by the Note and secured by the other Loan Documents to the same
extent and effect as if the terms and provisions of such Interest Rate
Agreement were set forth herein, whether or not the aggregate of such
indebtedness, together with the disbursements made by Lenders of the
proceeds of the Loan, shall exceed the face amount of the Note.
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2.11.2 Borrower hereby collaterally assigns to Agent for the benefit
of Lenders any and all Interest Rate Protection Products, if any,
purchased or to be purchased by Borrower in connection with the Loan, as
additional security for the Loan, and agrees to provide Lenders with any
additional documentation requested by Lenders in order to confirm or
perfect such security interest during the term of the Loan. If Borrower
obtains an Interest Rate Protection Product from a party other than Agent,
Borrower shall deliver to Lenders such third party's consent to such
collateral assignment. No Interest Rate Protection Product purchased from
a third party may be secured by an interest in Borrower or the Collateral.
ARTICLE 3
SECURITY FOR THE LOANS; LOAN AND SECURITY DOCUMENTS.
3.1 Security for Loan
The Loans, together with interest thereon and all other charges and
amounts payable by, and all other Obligations of, the Borrower and the
other Loan Parties to the Agent and/or each of the Lenders, shall be
secured by the following collateral (the "Collateral") which the Borrower
agrees to provide and maintain, or cause to be provided and maintained
(whether provided for each in separate agreements or combined with various
other agreements):
3.1.1 Security Agreement. To the extent permitted under the terms of
the applicable Formation Documents or documents evidencing any Subsidiary
Debt, a first priority security agreement and collateral assignment
granted by the Borrower to the Agent, on behalf of the Lenders, respecting
all assets of the Borrower, whether now owned, now due, or in which the
Borrower has an interest, or hereafter, at any time in the future,
acquired, arising, to become due, or in which the Borrower obtains an
interest.
3.1.2 Borrower Ownership Interest Pledge and Security Agreements.
First priority Ownership Interest Pledge and Security Agreements granted
by the Borrower to the Agent, on behalf of the Lenders, with respect (a)
to all right, title, and interest of the Borrower to and in the Borrower's
respective ownership interests in those Subsidiaries as set forth in
Exhibit M annexed hereto, and (b) all right, title, and interest of the
Borrower to and in the Securities (the "Pledged Securities") described on
Exhibit N annexed hereto, together with any required third party consents,
waivers or control agreements required in order to vest, perfect and
confirm the Agent's lien and rights with respect to such interests.
3.1.3 Depository Account Pledge and Security Agreements. A first
priority Depository Account Pledge and Security Agreement granted by the
Borrower and any Loan Party to the Agent, on behalf of the Lenders,
respecting any of the Borrower's Accounts to the extent established by
such Persons at KEYBANK NATIONAL ASSOCIATION (or any successor thereto or
affiliate thereof) (singly and collectively the "Depository Account Pledge
and Security Agreement").
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3.1.4 Guaranties and Security Agreements from Guarantor.
(a) The unlimited guaranty from each Guarantor, pursuant to
which each Guarantor shall guaranty the prompt, punctual, and
faithful payment of the Loans and the performance of all other
Obligations to the Agent and each of the Lenders under the Loan
Documents (singly and collectively, the "Guaranty").
(b) First priority security agreement and collateral
assignment granted by each Subsidiary Guarantor to the Agent, on
behalf of the Lenders, respecting all assets of each Subsidiary
Guarantor, whether now owned, now due, or in which each Subsidiary
Guarantor has an interest, or hereafter, at any time in the future,
acquired, arising, to become due, or in which the Borrower obtains
an interest.
3.1.5 Subsidiary Collateral Documents. The following collateral
documents granted to the Agent from the applicable Subsidiary listed
below:
(a) A Collateral Assignment of Loan Documents granted by
FT-Clearwater Loan LLC, which consists of a first mortgage loan held
by FT-Clearwater Loan LLC, secured by, without limitation, a first
mortgage on property located in Clearwater, Florida, and certain
other security documents and agreements executed in connection
therewith, together with all consents and other agreements required
by the Agent in connection therewith (the "Clearwater Loan
Facility");
(b) An Ownership Interest Pledge and Security Agreement
granted by FT-5400 Westheimer LLC with respect to its limited
partnership interests in ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Holding L.P., a Delaware
limited partnership, together with all necessary consents and
agreements required by the Agent in connection therewith;
(c) A Collateral Assignment of Loan Documents granted by
FT-5400 New Unit Lender LLC, which consists of certain promissory
notes evidencing loans made by FT-5400 New Unit Lender LLC to the
underlying borrowers in connection therewith, and secured by,
without limitation, assignments granted by the underlying borrowers
to FT-5400 New Unit Lender LLC of each borrower's respective
participation interest in the ownership of ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ Holding
L.P., and other loan documents held by FT-5400 New Unit Lender LLC,
together with all consents and agreements required by the Agent in
connection therewith; and
(d) A Collateral Assignment of Loan Documents granted by
FT-MARC Loan LLC, which consists of certain promissory notes
evidencing loans made by FT-Marc Loan LLC to the Marc Borrowers, and
secured by, without limitation, pledges of ownership granted by
certain of the MARC Borrowers, a second mortgage granted by North
Star Trust Company, and other loan documents held by FT-MARC Loan
LLC, together with all consents and agreements required by the Agent
in connection therewith.
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3.1.6 Environmental Compliance and Indemnification Agreement. A
compliance and indemnification agreement with respect to environmental
matters ("Environmental Indemnity") from the Borrower and each Guarantor
(collectively, the "Indemnitor") in favor of the Agent and each of the
Lenders.
3.1.7 Additional Documents. Any other documents, instruments and
agreements with respect to the Loans as set forth on the Loan Agenda.
3.2 Loan Documents and Security Documents
The Loans shall be made, evidenced, administered, secured and governed by
all of the terms, conditions and provisions of the "Loan Documents", each as the
same may be hereafter modified or amended, consisting of: (i) this Loan
Agreement; (ii) the promissory notes in the form of Exhibit C, annexed hereto,
payable by the Borrower to each of the respective Lenders in the original
aggregate principal amount of up to FIFTY MILLION DOLLARS ($50,000,000.00)
(collectively, the "Note"); (iii) the various documents and agreements
referenced in Section 3.1, above; (iv) any Consents or Payment Direction Letters
executed by any Borrower Subsidiary; (v) the Interest Rate Protection Agreement
(if any), (vi) the Cash Management Agreement (if any); and (vii) any other
documents, instruments, or agreements heretofore or hereafter executed to
further evidence or secure the Loan.
Each of the Loan Documents listed above is dated as of the date hereof.
The Loan Documents referenced in Section 3.1 , together with any additional
documents granted in favor of the Agent under Section 3.3 in connection with the
grant of Additional Collateral, are sometimes referred to herein, singly and
collectively as the "Security Documents".
3.3 Additional Borrowing Base Collateral. From time to time during the
term of this Agreement following Borrower's written request ("Additional
Collateral Request"), and the Borrower's compliance with the provisions of this
Section 3.3, the Required Lenders shall authorize the Agent to accept additional
assets ("Additional Collateral") from the Borrower or any Borrower Subsidiary or
other Loan Party and include the value of such Additional Collateral in the
determination of the Borrowing Base (based on the formula set forth in the
definition of Borrowing Base, or on such other basis as the Agent and the
Lenders may reasonably determine with respect to such Additional Collateral).
The Lenders shall agree to the inclusion of such Additional Collateral in the
Borrowing Base, only upon the satisfaction of the following conditions, in a
manner reasonably acceptable to the Agent and the Required Lenders:
3.3.1 No Event of Default shall exist under this Agreement or the
other Loan Documents at the time of the Additional Collateral Request or
at the time of any such assets becoming Additional Collateral hereunder,
except for any Default which is cured or remedied by such Additional
Collateral becoming part of the Borrowing Base.
3.3.2 All representations and warranties contained herein or in the
other Loan Documents shall be true and correct in all material respects as
of the time of the delivery of any such Additional Collateral (or shall
become true by virtue of such Additional Collateral becoming part of the
Borrowing Base), including the Borrower's continued compliance with the
Financial Covenants.
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3.3.3 The Borrower shall pay or reimburse the Agent for all
appraisal fees, title insurance and recording costs, reasonable legal fees
and expenses and other costs and expenses incurred by Agent in connection
with the additional Collateral.
3.3.4 The Borrower or the applicable Loan Party shall have executed
all such documents and taken all such action (and caused any Person to
take such action and execute such documents) as the Agent may request to
vest, perfect and confirm the guaranties, liens and security interests
required by the Agent with respect to such Additional Collateral.
3.3.5 The Borrower, any applicable Borrower Subsidiary or Loan
Party, and the subject Additional Collateral shall have satisfied all
applicable conditions precedent set forth in Article 5 prior to the
inclusion of the Additional Collateral in the Borrowing Base.
Any failure of the proposed Additional Collateral to meet in all material
respects all of the foregoing conditions shall be deemed a rejection of the
proposed addition of the Additional Collateral in the Borrowing Base for that
Additional Collateral Request and such proposed Additional Collateral shall not
be included in the Borrowing Base for any purpose unless and until all of the
foregoing conditions are satisfied or waived by the Agent and the Required
Lenders. The Agent shall give the Borrower prompt written notice of the decision
of the Required Lenders with respect to the admission or rejection of any
Additional Collateral as a component of the Borrowing Base.
ARTICLE 4
CONTINUING AUTHORITY OF AUTHORIZED REPRESENTATIVES
4.1 Authorized Representatives
Agent and each of the Lenders are authorized to rely upon the continuing
authority of the persons, officers, signatories or agents hereafter designated
("Authorized Representatives") to bind the Borrower with respect to all matters
pertaining to the Loans and the Loan Documents including, but not limited to,
the selection of interest rates, the submission of any request for a Loan and
certificates with regard thereto. Such authorization may be changed only upon
written notice to Agent accompanied by evidence, reasonably satisfactory to
Agent, of the authority of the person giving such notice. The present Authorized
Representatives as to the Borrower are listed on Exhibit D. The Agent shall have
a right of approval, not to be unreasonably withheld or delayed, over the
identity of the Authorized Representatives so as to assure Agent and each of the
Lenders that each Authorized Representative is a responsible and senior official
of the Borrower.
ARTICLE 5
CONDITIONS PRECEDENT.
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It shall be a condition precedent of Lenders' obligation to close the
Facility and to fund the initial Loans under the Facility that each of the
following conditions precedent be satisfied in full (as determined by each
Lender in its discretion which discretion shall be exercised in good faith
having due regard for the advice of the Agent), unless specifically waived in
writing by all of the Lenders at or prior to the date of the funding of the
initial Loans under the Facility (the date of the closing of the Loan shall be
referred to herein as the "Closing Date" and the date of the initial Loan under
the Facility shall be referred to herein as the "Funding Date"), and the Lenders
shall, subject to compliance with all of the other terms, conditions and
provisions of this Agreement, make disbursement of the initial Loan under the
Facility on the Closing Date and shall, if so requested by Borrower as and when
provided in Section 2.1 and as otherwise provided herein, make disbursement of
Loans subject to the satisfaction of said following conditions precedent:
5.1 Satisfactory Loan Documents and Related Documents; Loan Agenda Items
On the Funding Date, each of the Loan Documents and the Related Documents
shall be satisfactory in form, content and manner of execution and delivery to
Agent and Agent's counsel and all Loan Documents and Related Documents shall be
in full force and effect. Without limiting the foregoing, the Agent shall have
received each of the instruments, documents, and agreements itemized on the Loan
Agenda, each executed and delivered in favor of, and/or in form and substance
reasonably satisfactory to, the Agent.
5.2 Financial Information; No Material Change.
(a) No change shall have occurred in the financial condition,
business, affairs, operations or control of the Borrower, the Loan
Parties, and/or the other Loan Parties since the date of their
respective financial statements most recently delivered to Agent,
which change has had or could reasonably be expected to have a
Material Adverse Effect; and the Borrower and the other Loan Parties
shall have furnished Agent such other financial information and
certifications as reasonably requested by the Agent.
(b) The absence of any material adverse change in the loan
syndication, financial or capital market conditions generally from
those currently in effect.
(c) The Borrower shall have provided to the Agent a copy
certified by an officer of the Borrower of its balance sheet after
giving effect to the Loan, to evidence that the Borrower is solvent,
has assets having a fair value in excess of the amount required to
pay the Borrower's probable liabilities on the Borrower's existing
Debts as such become absolute and mature, and has adequate capital
for the conduct of the Borrower's business and the ability to pay
the Borrower's Debts from time to time incurred in connection
therewith as such Debts mature.
5.3 Warranties and Representations Accurate
All warranties and representations made by or on behalf of any of the
Borrower and the other Loan Parties, or any of them, to Agent or any of the
Lenders shall be true, accurate and complete in all material respects and, to
the best of the Borrower's Knowledge, shall not omit any material fact necessary
to make the same not misleading.
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5.4 Validity and Sufficiency of Security Documents
The Security Documents shall create a valid and perfected lien on the
Collateral described therein and each of the Security Documents and related UCC
filings shall have been duly recorded and filed to the satisfaction of Agent and
Agent's counsel, including, without limitation, as follows:
(a) On the Funding Date, the Borrower and the other Loan
Parties shall have delivered to the Agent evidence of the completion
of all recordings and filings of, or with respect to, the Security
Documents or, in the case of UCC-1 financing statements, delivery of
such financing statements in proper form for recording, and shall
have taken all such other actions as may be necessary or, in the
reasonable opinion of the Agent, desirable to perfect the Liens and
security interests intended to be created by the Security Documents
in the Collateral covered thereby. Such filings, recordings and
other actions shall include, without limitation, in addition to the
UCC-1 financing statements, (x) delivery to the Agent of the
certificates, if any, representing the respective partnership and
membership interests in each partnership and limited liability
company, the partnership or membership interests in which are being
pledged to Agent on behalf of the Lenders pursuant to the Security
Documents, and (y) delivery to the Agent of all consents,
acknowledgments, and approvals relating in any way to the Security
Documents as the Agent in its reasonable discretion determines
appropriate, including, without limitation, those consents and
approvals set forth in the Loan Agenda with respect to the granting
of the Security Documents and the acknowledgment of the interests of
the Agent and the Lenders created therein (the "Consents"); and
(b) on or prior to the Funding Date, the Agent shall have
received the results of a UCC, tax lien and judgment search in the
jurisdictions in which the Borrower, the Borrower Subsidiaries, and
the other Loan Parties, respectively, are organized, have assets, or
have their chief executive office, and the results of such search
shall indicate there are no judgments or Liens not permitted under
the Loan Documents.
5.5 Payment Direction And Authorization
Agent shall have received evidence of such Payment Direction Letters set
forth in the Loan Agenda in order to evidence the intended management of the
cash flow of the Borrower and the other Loan Parties.
5.6 Litigation
Except as noted on Schedule 6.5, on the Funding Date, there shall not be
any actions, suits or proceedings at law or in equity or by or before any
governmental instrumentality or other agency or regulatory authority by any
entity (private or governmental) pending or, to the best of the Borrower's
Knowledge, threatened with respect to the Loan, the transactions contemplated in
the Loan Documents or any documentation executed in connection therewith, or in
connection with the Borrower or any other Loan Party, which the Agent shall
determine in good faith is likely to have a Material Adverse Effect.
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5.7 Formation Documents and Entity Agreements.
(a) On the Funding Date, the Agent shall have received a
certificate of the general partner or managing member or manager, as
applicable, of the Borrower and each other Loan Party which is a
partnership or limited liability company, annexing and certifying as
to (a) the Formation Documents of such entity having been duly
executed, delivered and filed and remaining in full force and effect
and unmodified as of the date of such certificate (and annexing a
copy thereof), (b) due authorization, execution and delivery by such
entity of the Loan Documents to which it is a party, and (c) such
entity being in good standing and authorized to do business in each
jurisdiction where the ownership of its assets and operation of its
business requires such qualification, as each of the foregoing is
set forth in Loan Agenda;
(b) On the Funding Date, the Agent shall have received a
certificate of the managing member or manager of each Loan Party
which is a limited liability company annexing and certifying as to
(a) resolutions of such entity authorizing and approving the
transactions contemplated by the Loan Documents, and the execution
and delivery thereof by such entity in respect of the documents to
which it is a party and on behalf of the other entities in which
such limited liability company is a general partner or managing
member in respect of any of the Loan Documents, (b) signatures and
incumbency of all officers of such limited liability company
executing documentation on behalf of such entity or on behalf of any
entity as to which such limited liability company is a general
partner or managing member, as the case may be, in connection with
the transactions contemplated by the Loan Documents, (c) the
Formation Documents of such entity having been duly executed,
delivered and filed and remaining in full force and effect and
unmodified as of the date of such certificate (and annexing copies
thereof) and (d) such entity being in good standing and authorized
to do business in each jurisdiction where the conduct of its
business and ownership of its assets requires such qualification, as
each of the foregoing is set forth in the Loan Agenda.
(c) On the Funding Date, the Agent shall have received a
certificate of the secretary of each Loan Party which is a
corporation annexing and certifying as to (a) corporate resolutions
of such entity authorizing and approving the transactions
contemplated by the Loan Documents, and the execution and delivery
thereof by such entity in respect of the documents to which it is a
party and on behalf of the other entities in which such corporation
is a general partner or managing member in respect of any of the
Loan Documents, (b) signatures and incumbency of all officers of
such corporation executing documentation on behalf of such entity or
on behalf of any entity as to which such corporation is a general
partner or managing member, as the case may be, in connection with
the transactions contemplated by the Loan Documents, (c) the
Formation Documents of such entity having been duly executed,
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delivered and filed and remaining in full force and effect and
unmodified as of the date of such certificate (and annexing copies
thereof) and (d) such entity being in good standing and authorized
to do business in each jurisdiction where the conduct of its
business and ownership of its assets requires such qualification,
including, as each of the foregoing is set forth in the Loan Agenda.
5.8 Compliance With Law
There are no Legal Requirements which prohibit or adversely limit the
capacity or authority of the Borrower to enter into the Facility or any Loan
Party to execute the Loan Documents to which it is a party, and perform the
obligations of such Person with respect thereto.
5.9 Compliance With Financial Covenants
Agent shall have received an Officer's Certificate reflecting compliance
with the Financial Covenants and the terms and conditions hereof.
5.10 Due Diligence
Agent shall have received and completed a review of such due diligence as
the Agent may require with respect to any Collateral, including, without
limitation:
(a) Updated title reports and copies of existing owner's or
lender's title insurance policies with respect to the Individual
Properties owned (fee simple or land estate) or ground leased by any
Loan Party, or subject to a mortgage or participation interest in
any loan held by a Loan Party (the "Title Reports");
(b) Copies of all notes, mortgages and other loan documents
evidencing any Collateral;
(c) Borrower's certification as to the principal balance and
the regularly scheduled principal and interest payments due on all
Subsidiary Debt as of December, 2005;
(d) Copies of all agreements and restrictions related to the
Pledged Securities; and
(e) To the extent available, zoning reports and surveys for
each Individual Property.
5.11 Condition of Property
There shall have been no uninsured, unrepaired, or unrestored damage or
destruction by fire or otherwise to any of the real or tangible personal
property comprising or intended to comprise the Individual Properties which
could reasonably be expected to have a Material Adverse Effect.
5.12 Insurance
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To the extent requested by the Agent, the Borrower shall have provided to
Agent evidence of the following insurance, each meeting the requirements of the
Agent: (i) reasonably satisfactory blanket liability insurance in favor of the
Borrower and each of the Borrower Subsidiaries, and physical all-risk insurance;
(ii) a reasonably satisfactory report from the third party monitoring the
insurance as to the hazard and other insurance on the Individual Properties
maintained by the respective owner or tenant thereof, and (iii) a reasonably
satisfactory third party contract regarding the monitoring of the insurance to
be obtained by tenants under Leases with respect to the Individual Properties.
5.13 Third Party Consents and Agreements
The Agent shall have received the Consents and such other third party
consents, control agreements and other agreements as the Agent may require with
respect to the Loan.
5.14 Legal Opinions
Agent shall have received and approved legal opinion letters from counsel
representing the Borrower and the other Loan Parties which meet Agent's legal
opinion requirements and covering such matters incident to the transactions
contemplated herein, as the Agent may reasonably request.
5.15 No Default
There shall not be any Default under any of the Loan Documents.
ARTICLE 6
WARRANTIES AND REPRESENTATIONS.
The Borrower warrants and represents to Agent and each of the Lenders for
the express purpose of inducing Lenders to enter into this Agreement, to make
each Loan, and to otherwise complete all of the transactions contemplated hereby
that upon the date of each Loan advance and at all times thereafter until the
Loan has been repaid and all Obligations have been satisfied as follows:
6.1 Formation
Each of the Borrower and the other Loan Parties has been duly formed and
is validly existing and in good standing as a corporation, limited partnership,
limited liability company or trust, as the case may be, under the laws of the
State of its formation. Each of the Borrower and the other Loan Parties has the
requisite power and authority to own its assets and conduct its businesses as
currently conducted and owned, and to enter into and perform its obligations
under each Loan Document and/or Related Document to which it is a party. Each of
the Borrower and the other Loan Parties is in good standing and authorized to do
business in each jurisdiction where the ownership of its assets and/or the
conduct of its business requires such qualification except where the failure to
be so qualified would not have a Material Adverse Effect.
6.2 Proceedings; Enforceability
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Each of the Borrower and the other Loan Parties has taken all requisite
action to authorize the execution, delivery and performance by such Person of
the Loan Documents and/or the Related Documents to which it is a party. Each
Loan Document and the Related Document to which it is a party which is required
to be executed and delivered on or prior to the date on which this
representation and warranty is being made has been duly authorized, executed and
delivered and constitutes the legal, valid and binding obligation of each of the
Borrower and the other Loan Parties which is a party thereto, enforceable
against each such Person in accordance with its respective terms except to the
extent that the enforceability thereof may be limited by applicable bankruptcy,
insolvency and similar laws affecting rights of creditors generally and to
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
6.3 Conflicts
Neither the execution, delivery and performance of the Loan Documents and
the Related Documents by each of the Borrower and the other Loan Parties or
compliance by any such Person with the terms and provisions thereof (including,
without limitation, the granting of Liens pursuant to the Security Documents),
(i) will contravene any provision of any law, statute, rule or regulation or any
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
or conditions of, or constitute a default under, or result in the creation or
imposition (or the obligation to create or impose) of any Lien (except pursuant
to the Security Documents) upon any of the property or assets of any such Person
pursuant to the terms of any indenture, mortgage, deed of trust, credit
agreement or loan agreement or any other agreement, contract or instrument to
which any such Person is a party or by which it or any of its properties or
assets is bound or to which it may be subject or (iii) will violate any
provision of any Formation Document of any such Person.
6.4 Ownership and Taxpayer Identification Numbers.
(a) All of the partners, owners, stockholders, and members,
respectively and as may be applicable, of each of the Borrower and
the other Loan Parties (other than the REIT) are listed in Exhibit
F. The exact correct name and organizational number(s) and federal
employer identification number(s) of the Borrower and the other Loan
Parties are accurately stated in Exhibits F and M.
(b) The Borrower is the owner of all of the ownership
interests set forth in Section 3.1.2, above, pledged by it to the
Agent, on behalf of the Lenders. Except for such ownership
interests, the Borrower does not directly hold any stock,
membership, partnership or ownership interest in any other Person.
(c) The applicable Loan Party is each the owner, respectively,
of all of the Collateral to be pledged by such Loan Party to the
Agent, on behalf of the Lenders, pursuant to the Loan Documents.
Except for such ownership interests and except as shown on Schedule
6.4, the Borrower and the other Loan Parties do not directly hold
any stock, membership, partnership or ownership interest in any
other Person.
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(d) Except as shown on Schedule 6.4, no Loan Party or third
party, directly or indirectly, owns or controls any interest in any
asset relating to the Borrower or the business operations of the
Borrower and/or the Borrower Subsidiaries.
6.5 Litigation
Except as set forth in Schedule 6.5, there are no actions, suits or
proceedings at law or in equity or by or before any governmental instrumentality
or other agency or regulatory authority by any entity (private or governmental)
pending or, to the best of the Borrower's Knowledge, threatened with respect to
the Loan, or the transactions contemplated in the Loan Documents or the Related
Documents, or any documentation executed in connection therewith, or against the
Borrower and/or any of the other Loan Parties which could reasonably be expected
to have a Material Adverse Effect.
6.6 Information
All factual information furnished by or on behalf of the Borrower and the
other Loan Parties to the Agent and/or any of the Lenders (including, without
limitation, all information contained in the Loan Documents) for purposes of or
in connection with this Agreement, the other Loan Documents or any transaction
contemplated herein or therein is, and all other such factual information
hereafter furnished by or on behalf of the Borrower and the other Loan Parties
to the Agent and/or any of the Lenders will be, true and accurate in all
material respects on the date as of which such information is dated or certified
and to the best of the Borrower's Knowledge, not incomplete by omitting to state
any fact necessary to make such information not misleading in any material
respect at such time in light of the circumstances under which such information
was provided.
6.7 Taxes
Each of the Borrower and the other Loan Parties has made all required tax
filings and have paid all federal, state and local taxes applicable to them
and/or their respective assets, except if contested in accordance with Section
9.1.
6.8 Financial Information
The financial statements of the Borrower and the other Loan Parties
provided to the Agent present fairly the financial conditions of each at the
dates of such statements of financial condition and the results of operations
for the periods covered thereby. Since the dates of the relevant financial
statements, no change has occurred which could have or reasonably be expected to
have a Material Adverse Effect.
6.9 Management Agreements
Except for the agreements listed on Schedule 6.9 (the "Management
Agreements"), there are no other management agreements or asset management
agreements respecting the management of the assets of the Borrower and/or any of
the other Loan Parties.
6.10 Control Provisions.
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(a) The Borrower controls, directly or indirectly, and without
the requirement for consent of any other Person, the management of
each Borrower Subsidiary.
(b) Except as set forth on Schedule 6.10, there are no
provisions in any limited partnership agreement, operating
agreement, certificate of incorporation, bylaws or any other
agreement or instrument to which the Borrower or any Borrower
Subsidiary is party, under which any Person (other than the Borrower
or a Borrower Subsidiary) has the right to exercise the management
or control rights, powers or authority currently belonging to the
Borrower or any Borrower Subsidiary, except as set forth in any
mortgage, deed of trust or similar security agreement encumbering
any Individual Property upon exercise of the rights and remedies
upon default set forth in any of the foregoing.
6.11 Formation Documents
The Borrower has delivered or caused to be delivered to the Agent true and
complete copies of all Formation Documents of the Borrower and the other Loan
Parties, and all amendments thereto as of the date hereof and as of the date of
each Loan.
6.12 Related Documents
To the extent not provided for otherwise in this Article 6, true and
correct copies of all other Related Documents, together with all amendments and
modifications thereto, have been delivered to the Agent, each of which is in
full force and effect and, to the best of the Borrower's Knowledge, no material
default has occurred thereunder which could have a Material Adverse Effect.
6.13 Bankruptcy Filings
None of the Borrower or any of the other Loan Parties is contemplating
either a filing of a petition under any state or federal bankruptcy or
insolvency laws or the liquidation of all or a major portion of its assets or
property, and the Borrower has no Knowledge of any Person contemplating the
filing of any such petition against any of the Borrower and/or any of the other
Loan Parties.
6.14 Options
Except as set forth on Schedule 6.10, no Person holds a right of first
refusal or option to purchase with respect to any item of Collateral other than
as set forth in any Lease.
6.15 Investment Company
None of the Borrower and/or any of the other Loan Parties is an
"investment company" or a company "controlled" by an "investment company,"
within the meaning of the Investment Company Act of 1940, as amended.
6.16 Holding Company
23
None of the Borrower and/or any of the other Loan Parties is a "holding
company," or a "subsidiary company" of a "holding company," or an "affiliate" of
a "holding company" or of a "subsidiary company" of a "holding company," within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
6.17 Individual Properties.
6.17.1 Each of the Property Owners possesses such Licenses and
Permits issued by the appropriate federal, state, or local regulatory
agencies or bodies necessary to own and operate each Individual Property,
except where the failure to possess any such License or Permit would not
have a Material Adverse Effect. The Property Owners are in material
compliance with the terms and conditions of all such Licenses and Permits,
except where the failure so to comply would not, singly or in the
aggregate, result in a Material Adverse Effect. All of the Licenses and
Permits are valid and in full force and effect, except where the
invalidity of such Licenses and Permits or the failure of such Licenses
and Permits to be in full force and effect would not result in a Material
Adverse Effect. Neither the Borrower nor any of the Property Owners has
received any notice of proceedings relating to the revocation or
modification of any such Licenses and Permits which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would result in a Material Adverse Effect.
6.17.2 Except to the extent the failure of the following to be true
would not result in a Material Adverse Effect, (i) the Property Owners
have either (x) fee simple title to the Individual Properties, (y) a land
estate interest for a specified number of years in the Individual
Properties, or (z) a leasehold estate interest in the Individual
Properties; (ii) the interests of the Property Owners in the Individual
Properties are not subject to any Liens securing the repayment of money
except for those securing the repayment of the Subsidiary Debt, as set
forth in Schedule 6.17.7, and (iii) each land estate remainderman interest
and lessor interest under a Ground Lease is not, directly or indirectly,
owned or controlled by a Loan Party, Borrower Subsidiary or other Loan
Party;
6.17.3 Except to the extent the failure of the following to be true
would not result in a Material Adverse Effect, (i) to the best of
Borrower's Knowledge and except as otherwise disclosed in those reports
identified on Schedule 6.17.3, each Individual Property is free of any
Hazardous Materials in violation of any Environmental Laws applicable to
such property; (ii) none of the Property Owners or Borrower has received
any notice of a claim under or pursuant to any Environmental Laws
applicable to an Individual Property or under common law pertaining to
Hazardous Materials on or originating from any Individual Property; and
(iii) none of the Property Owners or Borrower has received any notice from
any Governmental Authority claiming any material violation of any
Environmental Laws that is uncured or unremediated as of the date hereof;
6.17.4 Except as set forth on Schedule 6.17.4, the mortgages and
deeds of trust encumbering the Individual Properties of any Property
Owners are not cross-defaulted or cross-collateralized to any Individual
Property owned by any other Property Owners;
6.17.5 Except to the extent the failure of the following to be true
would not result in a Material Adverse Effect, (i) with respect to the
Individual Properties, each Lease is in full force and effect, (ii) except
as set forth in Schedule 6.17.5, to the best of Borrower's Knowledge, none
of the Property Owners is in default in the performance of any material
obligation under any Lease and Borrower has no Knowledge of any
24
circumstances which, with the passage of time or the giving of notice, or
both, would constitute an event of default by any party under any of the
Leases, (iii) except as set forth in Schedule 6.17.5, to the best of
Borrower's Knowledge, no tenant is in monetary default beyond thirty (30)
days or material non-monetary default under its Lease, (iv) except as
otherwise expressly set forth in Schedule 6.17.5, to the best of
Borrower's Knowledge, there are no actions, voluntary or involuntary,
pending against any tenant under a Lease under any bankruptcy or
insolvency laws, (v) none of the Leases and none of the rents or other
amounts payable thereunder has been assigned, pledged or encumbered by any
of the Property Owners or any other Person, except in connection with
financing secured by the applicable Individual Property (the foregoing
schedule, as updated from time to time as provided herein, being referred
to herein as the "Lease Schedule").
6.17.6 Except to the extent the failure of the following to be true
would not result in a Material Adverse Effect, (i) each Ground Lease is
valid, binding and in full force and effect as against the applicable
Property Owners and, to the best of Borrower's Knowledge, the other party
thereto, (ii) except for tenants under the Leases and except in connection
with security relating to the Subsidiary Debt, none of the Ground Leases
is subject to any pledge, lien, assignment, license or other agreement
granting to any third party any interest therein or any right to the use
or occupancy of any premises leased thereunder, and (iii) no payments
under any Ground Lease are delinquent and no notice of default thereunder
has been sent or received by any Loan Party which has not been cured or
waived prior to the date hereof, and to the best of Borrower's Knowledge,
there does not exist under any of the Ground Leases any default by any
Property Owners or any event which merely with notice or lapse of time or
both, would constitute such a default by any of the Property Owners.
6.17.7 Schedule 6.17.7 accurately details in all material respects
the approximate amount, term, and interest rate applicable to all
Subsidiary Debt encumbering the (the foregoing schedule, as updated from
time to time as provided herein, the "Subsidiary Debt Schedule"). Except
as noted on Schedule 6.17.7, no notice of default thereunder has been sent
or received by any Loan Party which has not been cured or waived prior to
the date hereof, and to the best of the Borrower's Knowledge, there does
not exist with respect to any Subsidiary Debt any default by any Property
Owners or any event which merely with notice or lapse of time or both,
would constitute such a default by any of the Property Owners. None of the
Borrower, any Loan Party, any Borrower Subsidiary, or any other Loan Party
owns, directly or indirectly, any material interest in any Subsidiary
Debt.
6.17.8 Each of the Property Owners is treated as a partnership for
federal income tax purposes and does not constitute a publicly traded
partnership within the meaning of Section 7704 of the Code.
6.17.9 Each of the Property Owners possesses valid owner's policy
title insurance from title insurers of recognized financial responsibility
on each of the Individual Properties in amounts not less than the original
purchase price of such properties, and such title insurance is in full
force and effect.
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6.18 Use of Proceeds
The proceeds of the Loan shall be used solely and exclusively as provided
in Section 1.3. No portion of the proceeds of the Loan shall be used by the
Borrower directly or indirectly, and whether immediately, incidentally or
ultimately for any purpose which would violate or be inconsistent with the
provisions of regulations of the Board of Governors of the Federal Reserve
System including, without limitation, Regulations G, T, U and X thereof.
6.19 Insurance
(i) The Individual Properties are insured by insurers of recognized
financial responsibility against such losses and risks in compliance with the
requirements of the Leases and as set forth in Exhibit E, hereto, such insurance
maintained by the tenants under the Leases; (ii) the Borrower has a monitoring
system in place to periodically verify whether the tenants under the Leases have
in place insurance as required by the applicable Lease; and (iii) the Borrower
has satisfactory liability insurance in favor of the Borrower and each of the
Borrower.
6.20 Deferred Compensation and ERISA
None of the Borrower and/or any of the other Loan Parties has any pension,
profit sharing, stock option, insurance or other arrangement or Plan for
employees covered by ERISA except as may be designated to Agent in writing by
the Borrower from time to time and no Reportable Event has occurred and is now
continuing with respect to any such ERISA Plan. The granting of the Loan, the
performance by the Borrower and/or of any of the other Loan Parties of their
respective obligations under the Loan Documents and/or such Persons' conducting
of their respective operations do not and will not violate any provisions of
ERISA.
6.21 No Default
There is no Default on the part of the Borrower or any of the other Loan
Parties under this Agreement or any of the other Loan Documents and no event has
occurred and is continuing which would constitute a Default under any Loan
Document.
6.22 Other Loan Parties' Warranties and Representations
The Borrower has no reason to believe that any warranties or
representations made in writing by any of the other Loan Parties to the Agent or
any of the Lenders are untrue, incomplete or misleading in any material respect.
ARTICLE 7
AFFIRMATIVE COVENANTS.
The Borrower covenants and agrees that from the date hereof and so long as
any indebtedness is outstanding hereunder, or any of the Loan or other
Obligations remains outstanding, as follows:
7.1 Notices
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The Borrower shall, with reasonable promptness, but in all events within
five (5) days after it has actual Knowledge thereof, notify Agent and each of
the Lenders in writing of the occurrence of any act, event or condition which
constitutes a Default or Event of Default under any of the Loan Documents. Such
notification shall include a written statement of any remedial or curative
actions which the Borrower proposes to undertake and/or to cause any of the
other Loan Parties to undertake to cure or remedy such Default or Event of
Default.
7.2 Financial Statements; Reports; Officer's Certificates
The Borrower shall furnish or cause to be furnished to Agent as set forth
herein from time to time, the following financial statements, reports,
certificates, and other information, all in form, manner of presentation and
substance acceptable to Agent and each of the Lenders:
(a) Annual Statements. Within one hundred twenty (120) days
after the close of each fiscal year of the Borrower, the
consolidated statements of financial condition of the REIT, the
Borrower and all non-consolidated Borrower Subsidiaries as at the
end of such fiscal year and the related consolidated statements of
income and retained earnings and statements of changes in financial
position for such fiscal year, in each case, commencing with the
Fiscal Year ending December 31, 2005, setting forth comparative for
the preceding fiscal year, internally prepared in accordance with
GAAP, all in form and manner of presentation acceptable to Agent,
such financial statements to include and to be supplemented by such
detail and supporting data and schedules as Agent may from time to
time reasonably determine, together with an Officer's Certificate
from the Borrower certifying that such financial statements are
true, accurate, and complete in all material respects and that no
Default or Event of Default has occurred and is continuing.
(b) Periodic Statements. Within forty-five (45) days after the
close of each calendar quarter (excluding the quarter ending on
December 31) commencing March 31, 2006, the following: (i) the
consolidated statements of financial condition of the REIT, the
Borrower and all non-consolidated Borrower Subsidiaries, internally
prepared in accordance with GAAP, consistently applied, as at the
end of such quarterly period and the related consolidated statements
of income and retained earnings and statements of changes in
financial position for such quarterly period and for the elapsed
portion of the Fiscal Year ended with the last day of such quarterly
period, in each case commencing with the Fiscal Year ending December
31, 2005, setting forth comparative figures for the related periods
in the prior fiscal year, subject to normal year-end audit
adjustments, all in form and manner of presentation acceptable to
Agent, such financial statements to include and to be supplemented
by such detail and supporting data and schedules as Agent may from
time to time reasonably determine, and (ii) an Officer's Certificate
from the Borrower certifying that such financial statements are
true, accurate, and complete in all material respects and that no
Default or Event of Default has occurred and is continuing.
(c) Compliance Certificates. Within forty-five (45) days after
the close of each quarterly Accounting period in each Fiscal Year of
the Borrower commencing March 31, 2006, Compliance Certificates in
the form of Exhibit G-1 and Exhibit G-2 annexed hereto, together
with an Officer's Certificate from the Borrower providing and
otherwise certifying with respect to the following:
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(i) the compliance with the Financial Covenants, with
such supporting detail as is deemed necessary by the Agent to
verify the calculations incorporated therein;
(ii) any changes to the Subsidiary Debt Schedule,
including, without limitation, (a) any prepayments made on any
Subsidiary Debt since the date of the then prior Officer's
Certificate, (b) specific identification of all Subsidiary
Debt which matures within the twelve (12) months following the
date of the Officer's Certificate, (c) any refinancing of such
Subsidiary Debt which has occurred (or for which an
application has been made or a loan commitment received) since
the date of the then prior Officer's Certificate, together
with a summary of the use and disbursement of the proceeds
thereof, and (d) any defaults then existing under any
Subsidiary Debt not included in a prior Officer's Certificate
or Subsidiary Debt Schedule, with such supporting detail as is
deemed necessary by the Agent to verify the calculations
incorporated therein;
(iii) A listing of any material assets (a) sold by the
Borrower, the Borrower Subsidiaries, and/or any of the other
Loan Parties since the date of then prior Officer's
Certificate, together with specific detail as to the use and
disbursement of the proceeds of the sale, and (b) as to which
an agreement has been entered into since the date of the then
prior Officer's Certificate for the sale thereof, together
with the primary terms of such agreement;
(iv) a listing of any material assets acquired, or as to
which an agreement to acquire has been entered into, by the
Borrower, the Borrower Subsidiaries, and/or any of the other
Loan Parties since the date of then prior Officer's
Certificate, together with the primary terms of such
acquisition or agreement;
(v) except as disclosed in such Officer's Certificate,
to the extent of the knowledge of such officer, a
certification that all insurance premiums in respect of
insurance policies covering the properties owned (directly or
indirectly) by the Property Owners have been paid or are not
past due more than sixty (60) days, all debt service payments
in respect of any Subsidiary Debt of have been made and all
real estate taxes and other impositions relating to any
Property Owner or its related assets have been paid; and
(vi) a summary of the status of any pending insurance
claims or condemnation award proceedings.
(d) Data Requested. Within a reasonable period of time and
from time to time such other financial data or information as Agent
may reasonably request with respect to the Individual Properties,
the Borrower, the Borrower Subsidiaries, and/or any of the other
Loan Parties, including, but not limited to, rent rolls, aged
receivables, aged payables, leases, budgets, forecasts, reserves,
cash flow projections, deposit accounts, mortgage information,
physical condition of the Borrower's Investments.
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(e) Tax Returns. To the extent prepared and filed, upon
Agent's request, copies of all federal and state tax returns of the
Borrower and any of the other Loan Parties.
(f) Debt Notices. Concurrently with the giving thereof, and
within ten (10) Business Days of receipt thereof, copies of all
notices, other than routine correspondence, given or received by the
Borrower, or any Loan Party with respect to any Subsidiary Debt.
(g) Entity Notices. Concurrently with the issuance thereof,
copies of all written notices (excluding routine correspondence)
given to the partners, owners, stockholders, and/or members,
respectively, of the REIT, the Borrower and/or any of the other Loan
Parties.
(h) Notice of Distributions. Concurrently with the giving
thereof, and within ten (10) Business Days of receipt thereof,
copies of all notices of Distributions to the extent given by any
Borrower Subsidiaries to the Borrower.
(i) Property Acquisition or Sale. Within ten (10) Business
Days of receipt thereof, copies of all contracts or agreements in
any way relating to a sale or acquisition of any material asset by
the Borrower, and Borrower Subsidiary, and/or any of the other Loan
Parties, along with a pro forma Compliance Certificate with respect
to the Financial Covenants after giving effect to the proposed
transaction.
(j) Third Party Default Notices. Immediately upon notice or
receipt thereof by the Borrower and/or any of the other Loan
Parties, copies of all notices of default, other non-performance,
and/or exercise (or intended exercise) relating in any way to any
one or more of the Related Documents.
(k) Notice of Litigation. Promptly, and in any event within
ten (10) Business Days after the Borrower obtains Knowledge thereof,
written notice of any pending or, to the best of the Borrower's
Knowledge, threatened action, suit or proceeding at law or in equity
or by or before any governmental instrumentality or other agency or
regulatory authority by any entity (private or governmental)
relating in any way to the Loan, the transactions contemplated in
the Loan Documents (including, without limitation, with regard to
all Distributions), the Related Documents, or relating to the
Borrower and/or any of the other Loan Parties, which could
reasonably be expected to have a Material Adverse Effect.
(l) Notice of Hazardous Materials Promptly, and in any event
within ten (10) Business Days after the Borrower obtains Knowledge
thereof, written notice of (i) any Release (as defined in the
Environmental Indemnity) or Threat of Release (as defined in the
Environmental Indemnity) of Hazardous Materials on, in, under or
affecting all or any portion of any Individual Property or (ii) the
violation of any Environmental Law, in each case which could
reasonably be expected to have a Material Adverse Effect.
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(m) Net Cash Flow. Within fifteen (15) days after the end of
each calendar quarter, a certification of the Net Cash Flow for the
quarter then ended.
7.3 Existence
The Borrower shall do or cause to be done all things necessary to (i)
preserve, renew and keep in full force and effect (x) the existence of the Loan
Parties and the Borrower Subsidiaries and (y) the material rights, licenses,
permits and franchises of the Loan Parties and the Borrower Subsidiaries, (ii)
comply with all laws and other Legal Requirements applicable to it and its
assets, business and operations and those of the Loan Parties and the Borrower
Subsidiaries, and (iii) to the extent applicable, at all times maintain,
preserve and protect all material franchises and trade names and all the
remainder of its property used or useful in the conduct of its business, and
keep its assets in good working order and repair, ordinary wear and tear
excepted, and from time to time make, or cause to be made, all reasonably
necessary repairs, renewals, replacements, betterments and improvements thereto.
7.4 Payment of Taxes
The Borrower shall duly pay and discharge, and cause the Loan Parties and
each Borrower Subsidiary to duly pay and discharge, before the same shall become
overdue, all taxes, assessments, impositions, and other governmental charges
payable by it or with respect to the Individual Properties, to the extent that
same are not paid by the tenants under the respective Leases, except if
contested in accordance with Section 9.1.
7.5 Insurance; Casualty, Taking.
7.5.1 The Borrower shall at all times maintain or cause the
appropriate Person to maintain in full force and effect the following
insurance: (i) to the best of the Borrower's Knowledge, the Individual
Properties shall be insured by insurers of recognized financial
responsibility against such losses and risks in compliance with the Leases
or, if such Lease does not require the tenant to maintain insurance for
the entire Individual Property, the requirements set forth in Exhibit E
hereto; (ii) the Borrower shall have a monitoring system in place to
periodically verify whether the tenants under the Leases have in place
insurance as required by the applicable Lease; and (iii) the Borrower
shall have satisfactory liability insurance in favor of the Borrower and
each of the Borrower Subsidiaries in compliance with the requirements in
effect of the date hereof.
7.5.2 In the event of any damage or destruction to any Individual
Property (or to the extent now or hereafter applicable, any Collateral) by
reason of fire or other hazard or casualty, the Borrower shall give
immediate written notice thereof to Agent. If there is any condemnation
for public use of any Individual Property (or to the extent now or
hereafter applicable, any Collateral), the Borrower shall give immediate
written notice thereof to Agent. Further, the Borrower shall upon the
request of the Agent provide to the Agent with a report as to the status
of any insurance adjustment, condemnation claim, or restoration resulting
from any casualty or taking.
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7.6 Inspection
The Borrower shall cause the Borrower Subsidiaries to permit the Agent and
the Lenders and its/their agents, representatives and employees to inspect the
Collateral at reasonable hours upon reasonable notice.
7.7 Loan Documents
The Borrower (i) shall observe, perform and satisfy all the terms,
provisions, covenants and conditions to be performed by it under, and to pay
when due all costs, fees and expenses, and other Obligations of the Borrower to
the extent required under, the Loan Documents and (ii) shall cause the other
Borrower Subsidiaries and other Loan Parties to observe, perform and satisfy all
the terms, provisions, covenants and conditions to be performed by such Person
under, and to pay when due all costs, fees and expenses, and other Obligations
to the extent required under, the Loan Documents.
7.8 Further Assurances
The Borrower shall and shall cause the Borrower Subsidiaries and other
Loan Parties to execute and deliver to the Agent and the other Lenders such
documents, instruments, certificates, assignments and other writings, and do
such other acts, necessary or desirable in the reasonable judgment of the Agent,
to evidence, preserve and/or protect the Collateral at any time securing or
intended to secure the Obligations and do and execute all and such further
lawful acts, conveyances and assurances as the Agent may reasonably require for
the better and more effective carrying out of the intents and purposes of this
Agreement and the other Loan Documents.
7.9 Books and Records
The Borrower shall and shall cause the Loan Parties and the Borrower
Subsidiaries and other Loan Parties to keep and maintain in accordance with GAAP
(or such other Accounting basis reasonably acceptable to the Agent), proper and
accurate books, records and accounts reflecting all of the financial affairs of
the Borrower and such other Persons and all items of income and expense in
connection with their respective business and operations and in connection with
any services, equipment or furnishings provided in connection with the operation
of the business of the Borrower and such Persons, whether such income or expense
is realized thereby or by any other Person. The Agent shall have the right, not
more than once each quarter (unless an Event of Default shall have occurred and
be continuing in which case as often as the Agent shall determine), during
normal business hours and upon reasonable notice, to examine such books, records
and accounts of the Borrower, and the other Loan Parties at the office of the
Person maintaining such books, records, and accounts and to make such copies or
extracts thereof as the Agent shall desire. The Borrower shall maintain all of
its business records at the address specified at the beginning of this
Agreement, subject to change upon advance written notification to the Agent. The
Agent may discuss the financial and other affairs of the Borrower and/or the
other Loan Parties with any of their respective partners, owners, and any
accountants (as to accountants, prior to the occurrence of an Event of Default
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and following the cure of any Event of Default, upon prior approval of the
Borrower, not to be unreasonably withheld, and at the cost and expense of the
Agent and the Lenders) hired by the Borrower, it being agreed that Agent and
each of the Lenders shall use best efforts to not divulge information obtained
from such examination to others except in connection with Legal Requirements and
in connection with administering the Loan, enforcing its rights and remedies
under the Loan Documents and in the conduct, operation and regulation of its
banking and lending business (which may include, without limitation, the
transfer of the Loan or of participation interests therein). Any assignee or
transferee of the Loan, co-lender, or any holder of a participation interest in
the Loan shall be entitled to deal with such information in the same manner and
in connection with any subsequent transfer of its interest in the Loan or of
further participation interests therein.
7.10 Business and Operations
The Borrower shall (and shall cause the Loan Parties and the Borrower
Subsidiaries to) (i) continue to engage in the type of businesses presently
conducted by them as of the Closing Date, respectively and otherwise permitted
to be conducted by the REIT and the Borrower, and (ii) be qualified to do
business and in good standing under the laws of each jurisdiction, and otherwise
to comply with all Legal Requirements, as and to the extent the same are
required for the ownership, maintenance, management and operation of the assets
of such Person except where the failure to be so qualified could not reasonably
be expected to have a Material Adverse Effect.
7.11 Title
The Borrower shall and shall cause the Borrower Subsidiaries and each Loan
Party to warrant and defend (x) the title to each item of Collateral owned by
such Person and every part thereof, subject only to the Liens (if any) permitted
hereunder, and (y) the validity and priority of the Liens and security interests
held by the Agent pursuant to the Loan Documents, in each case against the
claims of all Persons whomsoever. The Borrower shall be responsible to reimburse
Agent and the Lenders for any losses, costs, damages or expenses (including
reasonable attorneys' fees and court costs) incurred by the Agent and/or any of
the Lenders if an interest in any item of Collateral, other than as permitted
hereunder, is claimed by another Person.
7.12 Estoppel
The Borrower shall (and shall cause the Borrower Subsidiaries to), within
ten (10) days after a request therefor from the Agent, which request shall not
be made by Agent more than once each quarter during each Fiscal Year, furnish to
the Agent a statement, duly acknowledged and certified, setting forth (i) the
amount then owing by the Borrower in respect of the Obligations, (ii) the date
through which interest on the Loan has been paid, (iii) any offsets,
counterclaims, credits or defenses to the payment by the Borrower or any
Borrower Subsidiary to the Obligations and (iv) whether any written notice of
Default from Agent to the Borrower or any of the Borrower Subsidiaries is then
outstanding and acknowledging that this Agreement and the other Loan Documents
are in full force and effect and unmodified, or if modified, giving the
particulars of such modification.
7.13 ERISA
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The Borrower shall (and shall cause each of the Loan Parties and the
Borrower Subsidiaries to) as soon as possible and, in any event, within ten (10)
days after the Borrower, the Loan Parties, any Borrower Subsidiary or any ERISA
Affiliate knows or has reason to know of the occurrence of any of the following
which could have or reasonably be expected to have a Material Adverse Effect,
deliver to Agent a certificate of the an executive officer of the Borrower
setting forth details as to such occurrence and the action, if any, that the
Borrower, the Loan Parties, or applicable Borrower Subsidiary or such ERISA
Affiliate is required or proposes to take, together with any notices required or
proposed to be given to or filed with or by such the Borrower, the Loan Parties,
Borrower Subsidiary, the ERISA Affiliate, the PBGC, a Plan participant or the
Plan administrator with respect thereto: (i) that a Reportable Event has
occurred; (ii) that an accumulated funding deficiency has been incurred or an
application may be or has been made to the Secretary of the Treasury for a
waiver or modification of the minimum funding standard (including any required
installment payments) or an extension of any amortization period under Section
412 of the Code with respect to a Plan; (iii) that a contribution required to be
made to a Plan has not been timely made; (iv) that a Plan has been or may be
terminated, reorganized, partitioned or declared insolvent under Title IV of
ERISA; (v) that a Plan has an Unfunded Current Liability giving rise to a lien
under ERISA or the Code; (vi) that proceedings may be or have been instituted to
terminate or appoint a trustee to administer a Plan; (vii) that a proceeding has
been instituted pursuant to Section 515 of ERISA to collect a delinquent
contribution to a Plan; (viii) that the Borrower, the Loan Parties, Borrower
Subsidiary, or ERISA Affiliate will or may incur any liability (including any
indirect, contingent, or secondary liability) to or on account of the
termination of or withdrawal from a Plan under Section 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or with respect to a Plan under Section 401(a)(29),
4971, 4975 or 4980 of the Code or Section 409 or 502(i) or 502(l) of ERISA; (ix)
or that the Borrower, the Loan Parties, or Borrower Subsidiary may incur any
material liability pursuant to any employee welfare benefit plan (as defined in
Section 3(l) of ERISA) that provides benefits to retired employees or other
former employees (other than as required by Section 601 of ERISA) or any
employee pension benefit plan (as defined in Section 3(2) of ERISA). The
Borrower shall (and shall cause the Loan Parties and the Borrower Subsidiaries
to) deliver to Agent a complete copy of the annual report (Form 5500) of each
Plan required to be filed with the Internal Revenue Service. In addition to any
certificates or notices delivered to Agent pursuant to the first sentence
hereof, copies of any material notices received by the Borrower, the Loan
Parties, a Borrower Subsidiary, or any ERISA Affiliate with respect to any Plan
shall be delivered to Agent no later than ten (10) days after the date such
report has been filed with the Internal Revenue Service or such notice has been
received by Borrower, the Loan Parties, or Borrower Subsidiary or ERISA
Affiliate, as applicable.
7.14 Depository Accounts
The Agent and the Borrower shall negotiate in good faith regarding the
establishment by the Borrower and each of the other Loan Parties of operating
and other depository accounts, with the Agent (or any successor thereto) (singly
and collectively, including the Depository Accounts, the "Borrower Accounts"),
and the completion of Cash Management Agreements with respect to the use and
disbursement of funds in any the Borrower Account. Each of the Borrower Accounts
shall be subject to the Pledge and Security Agreement.
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7.15 Cash Flow; Payment Direction Letters. To the extent Borrower Accounts
and Cash Management Agreements are established under Section 7.14 above, some or
all of the following may be required:
7.15.1 The Borrower agrees that appropriate procedures satisfactory
to the Agent may be put in place such that subject to any limitations
provided for with respect to any Subsidiary Debt: (i) any Distributions
and other revenues due or payable to the Loan Parties and/or any Borrower
Subsidiary shall be paid directly in to the designated Depository Account
in the name of the Borrower or as otherwise directed by the Agent, and
(ii) any Distributions by any Borrower Subsidiary payable to the Borrower
and/or the Loan Parties shall be directly deposited in the designated
Depository Account in the name of the Borrower or as otherwise directed by
the Agent. Further, subject to any limitations provided for with respect
to any Subsidiary Debt, after the occurrence and during the continuance of
an Event of Default, Agent shall have the right to receive any and all
such Distributions or other revenues and make application thereof to the
Obligations.
7.15.2 The use and disbursement of all funds in the Depository
Accounts and the Borrower Accounts shall be subject to the terms and
provisions hereof and the Cash Management Agreement.
7.15.3 The Borrower agrees that to the extent that the Borrower, the
Loan Parties, any Borrower Subsidiary or any other Loan Party receives
directly any Distributions or revenues or other payments which are
required to be deposited as provided for herein, the Borrower shall, and
shall cause such Person to deposit such funds in the applicable designated
Depository Account as directed by the Agent.
7.15.4 The Borrower shall (and shall cause the Loan Parties and the
Borrower Subsidiaries) to maintain in place during the term of the Loan
such direction letters and agreements as the Agent may from time to time
require in order to effectuate the terms and provisions hereof relating to
the management of the cash flow of such Persons (together with the
Consents (to the extent that the Consents provide for the management of
cash flow), the "Payment Direction Letters.
7.15.5 the Borrower shall (and shall cause the other Loan Parties
to) keep in effect all Payment Direction Letters, including, without
limitation, any replacements, substitutions, or renewals thereof as the
Agent shall reasonably deem appropriate from time to time.
7.16 Distributions.
Subject to the requirements set forth in clause (h)(xvi) of the definition
of "Single-Purpose Entity" contained herein, the Borrower shall cause the
Borrower Subsidiaries to make the maximum amount of all Distributions to
the Borrower at the earliest opportunity permitted under the respective
Formation Documents of each of the Borrower Subsidiaries, but not less
often than quarterly and shall take all actions necessary (and as may be
directed by the Agent) to preserve and maintain the Distribution scheme
provided for herein.
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7.17 Costs and Expenses
The Borrower shall pay all costs and expenses (excluding salaries or wages
of employees of Agent) reasonably incurred by Agent in connection with the
implementation and syndication of the Loan and the administration of the Loan,
and reasonably incurred by the Agent or any of the Lenders in connection with
the enforcement of the Agent's and Lenders' rights under the Loan Documents,
including, without limitation, legal fees and disbursements, appraisal fees,
inspection fees, plan review fees, travel costs and fees and out-of-pocket costs
of independent engineers and consultants. The Borrower's obligations to pay such
costs and expenses shall include, without limitation, all attorneys' fees and
other costs and expenses for preparing and conducting litigation or dispute
resolution arising from any breach by the Borrower or the Loan Parties of any
covenant, warranty, representation or agreement under any one or more of the
Loan Documents. Unless an Event of Default has occurred and is then continuing,
the Agent shall use its best efforts to notify the Borrower prior to the
incurrence of any such cost or expense if the aggregate amount of such costs and
expenses in any one calendar year will exceed $10,000.00; provided, however,
that the failure shall provide such notice shall not affect in any manner
whatsoever on the Borrower's obligations hereunder.
7.18 Appraisals
7.18.1 Appraisal. Agent shall have the right at its option, from
time to time, to order an appraisal of one or more of the Individual
Properties prepared at Agent's direction by an appraiser selected by Agent
(the "Appraisal"). An appraiser selected by Agent shall be an MAI member
with appropriate experience appraising commercial properties in the
respective area(s) of the Individual Properties and otherwise qualified
pursuant to provisions of applicable laws and regulations under and
pursuant to which Agent operates).
7.18.2 Costs of Appraisal. The Borrower shall pay for the costs of
(i) each Appraisal and (ii) each updated Appraisal only after the
occurrence and during the continuance of an Event of Default; provided,
however, Borrower shall not be required to pay for more than one appraisal
per year, per property.
7.19 Indemnification
The Borrower shall at all times, both before and after repayment of the
Loan, at its sole cost and expense defend, indemnify, exonerate and save
harmless Agent and each of the Lenders and all those claiming by, through or
under Agent and each of the Lenders ("Indemnified Party") (to the extent not
paid by the Borrower in this Section 7.19 or under the applicable provisions of
this or any other Loan Document) against and from all damages, losses,
liabilities, obligations, penalties, claims, litigation, demands, defenses,
judgments, suits, proceedings, costs, disbursements or expenses of any kind
whatsoever, including, without limitation, attorneys' fees and experts' fees and
disbursements, which may at any time (including, without limitation, before or
after discharge or foreclosure of the Security Documents) be imposed upon,
incurred by or asserted or awarded against the Indemnified Party and arising
from or out of:
35
(a) any liability for damage to person or property arising out
of any violation of any Legal Requirement with respect to the
Borrower, any other Loan Party or any Individual Property, or
(b) any and all liabilities, damages, penalties, costs, and
expenses, relating in any manner to any brokerage or finder's fees
in respect of the Loan, or
(c) as a result of litigation that may arise in connection
with Borrower's activities, or
(d) the payment of any fees to any Loan Party or any manager
or owner of the Borrower; or
(e) any act, omission, negligence or conduct at any Individual
Property, or arising or claimed to have arisen, out of any act,
omission, negligence or conduct of the Borrower or any tenant,
occupant or invitee thereof which is in any way related to any
Individual Property.
Notwithstanding the foregoing, an Indemnified Party shall not be entitled
to indemnification in respect of claims arising from acts of its own gross
negligence or willful misconduct to the extent that such gross negligence
or willful misconduct is determined by the final judgment of a court of
competent jurisdiction, not subject to further appeal, in proceedings to
which such Indemnified Party is a proper party.
7.20 RESERVED.
7.21 Future Collateral Obligations
The Borrower acknowledges that the determination by the Agent as to the
Collateral was based upon an analysis of the assets owned by the Borrower and
the Borrower Subsidiaries, and the assets owned by Loan Parties that are parties
to the Security Documents. The Borrower shall (and shall cause each of the other
Loan Parties to) agree to the following undertaking (in each instance subject to
the provisions of any Debt incurred or assumed in connection therewith or any
limitations set forth in any equity documents executed in connection therewith):
7.21.1 In the event that at any time the Borrower or any Loan Party
acquires or obtains any interest in any asset, the Borrower shall notify
the Agent in writing and shall execute, or cause the applicable Person to
execute, such documents as shall be reasonably requested by the Agent to
confirm, or establish, that the interest so acquired or obtained is
included within the Collateral and to effectuate the terms and provisions
of this Agreement with respect thereto.
7.21.2 In the event that at any time the Borrower shall establish or
acquire a Person such that such Person is a Borrower Subsidiary, the
Borrower shall notify the Agent in writing and shall execute, or cause the
applicable Borrower Subsidiary to execute, such documents as shall be
reasonably requested by the Agent to confirm, or establish, that the
ownership interests in such Borrower Subsidiary and the assets of such
Subsidiary (other than the assets of Property Owners) are included within
the Collateral (subject to any existing Liens associated with any such
asset) and to effectuate the terms and provisions of this Agreement with
respect thereto.
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7.21.3 In the event that at any time the Borrower or any Borrower
Subsidiary acquires or obtains any interest in any asset (other than an
Individual Property), the Borrower shall notify the Agent in writing and
shall execute, or cause the applicable Borrower Subsidiary to execute,
such documents as shall be reasonably requested by the Agent to confirm,
or establish, that the asset so acquired or obtained is included within
the Collateral (subject to any existing Liens associated with any such
asset) and to effectuate the terms and provisions of this Agreement with
respect thereto (if the value of the asset acquired is less than
$1,000,000.00, the notification and documentation will be provided
annually).
7.21.4 Upon the payment in full of the Debt on any Individual
Property or if at any time any Individual Property is free and clear of
all Debt, at the option of the Agent, the applicable Property Owner (to
the extent same is a Borrower Subsidiary) shall grant to the Agent, on
behalf of the Lenders, a mortgage or deed of trust interest in and to said
Individual Property; provided, however, in the event of the incurrence of
Permitted Debt on the Individual Property, the Agent shall release the
said mortgage or deed of trust to the refinanced loan subject to the
payment.
7.21.5 The Borrower agrees to provide to the Agent written notice of
any of the events described in this Section 7.21 within five (5) Business
Days of Knowledge thereof by the Borrower and further agrees to execute
and deliver any documents as reasonably requested by the Agent to
effectuate the terms and provisions hereof within five (5) Business Days
of the Agent's request therefor.
7.22 Replacement Documentation
Upon receipt of an affidavit of an officer of Agent as to the loss, theft,
destruction or mutilation of the Note or any other Security Document which is
not of public record, and, in the case of any such loss, theft, destruction or
mutilation, upon surrender and cancellation of such Note or other Security
Document, the Borrower will issue, in lieu thereof, a replacement Note or other
security document in the same principal amount and otherwise of like tenor upon
receipt by the Borrower of a suitable indemnity.
7.23 Other Covenants
The Borrower hereby represents and warrants that no Collateral is in the
possession of any third party bailee (such as at a warehouse). In the event that
the Borrower and/or any of the other Loan Parties, after the date hereof,
intends to store or otherwise deliver any Collateral or other personal property
in which the Agent has been granted a security interest to such a bailee, then
the Borrower shall receive the prior written consent of the Agent and such
bailee must acknowledge in writing that the bailee is holding such Collateral or
such other personal property for the benefit of the Agent and the Lenders.
7.24 Related Documents
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The Borrower will, or will cause each Borrower Subsidiary and the Loan
Parties to, comply with the terms and provisions of all of the Related
Documents.
7.25 Reserved.
7.26 Financial Covenants
The Borrower shall comply with the following financial covenants:
7.26.1 Coverage Ratios.
(a) Certain Definitions.
(i) "Calculation Date" shall mean the last day of each
calendar quarter commencing with March 31, 2006.
(ii) "Calculation Period" shall mean each successive
twelve (12) month period ending on a Calculation Date.
(iii) "Consolidated Debt Service" shall mean the sum of
the aggregate Pro Rata regularly scheduled actual principal
and interest paid or payable respecting all Debt of the REIT,
the Borrower and their Subsidiaries (other than principal
amortization required under the loan made by Keybank National
Association to FT-FIN Acquisition LLC in the original
principal amount of $53,000,000.00) during the subject
Calculation Period.
(iv) "Consolidated Debt Service Coverage" shall mean the
ratio for the Calculation Period of: (A) Adjusted Earnings to
(B) Consolidated Debt Service
(v) "Debt Service" shall mean the sum of the aggregate
regularly scheduled actual principal and interest paid or
payable respecting all Debt of the Borrower during the subject
Calculation Period.
(vi) "Debt Service Coverage" shall mean the ratio for
the Calculation Period of: (A) Net Cash Flow to (B) Debt
Service.
(vii) "Fixed Charges" shall mean the aggregate of the
Borrower's and the REIT's Pro Rata share of all (a) interest
expenses, (b) regularly scheduled principal amortization
payments (other than any final "balloon" payments due at
maturity) on all Debt of the Borrower and its Subsidiaries,
(c) preferred dividend payments or required Distributions
(other than Distributions by the REIT to common equity
holders) paid or payable by the REIT, (d) ground lease
payments unless already deducted from Net Cash Flow, and (e)
tax expenses for the Borrower and its Subsidiaries, all of the
foregoing as determined in accordance with GAAP and in each
instance excluding amount due under the Repo Agreement.
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(viii) "Fixed Charge Coverage" shall mean the ratio of
(a) Adjusted Earnings to (b) Fixed Charges.
(ix) "Net Cash Flow" shall mean the sum of (i) (a) all
cash revenues from the aggregate of the Borrower and all of
the Borrower's Subsidiaries which are Loan Parties, including,
without limitation, all rents, management fees, ground rent,
loan payments, distributions, common area maintenance charges,
insurance premium and tax reimbursements and proceeds from
rental interruption insurance, less the aggregate of (ii) all
operating costs and expenses (excluding any debt service) of
the Borrower and all of the Borrower's Subsidiaries which are
Loan Parties related to such investments, amounts reserved for
taxes and insurance, replacement reserves, and capital
expenditures, all of the foregoing as reasonably determined by
the Agent in a manner consistent with the procedures and
methods utilized by the Agent in analyzing the financial
information provided by the Borrower prior to closing.
(b) Minimum Consolidated Debt Service Coverage. The
Consolidated Debt Service Coverage for each Calculation Period
determined on each Calculation Date shall be not less than 1.50:1.
The compliance with the Consolidated Debt Service Coverage covenant
shall be tested by the Agent on the Calculation Date with results
based upon the most recent Calculation Period results, as reasonably
determined by the Agent in a manner consistent with the procedures
and methods utilized by the Agent in analyzing the financial
information provided by the Borrower prior to closing. If such
Consolidated Debt Service Coverage covenant shall not be satisfied
on any Calculation Date, the Borrower shall prepay a sufficient
amount of principal outstanding on the Loan such that if such
principal reduction had been made on the first day of the
Calculation Period the Debt Service Coverage covenant would have
been satisfied. It shall be an Event of Default if the Borrower
fails to make such a prepayment not later than the first to occur
of: (i) ten (10) Business Days after notice from Agent to the
Borrower properly requesting the payment, or (ii) if the Borrower
has failed to give Agent sufficient reports to enable Agent to make
the necessary calculations, forty-five (45) days following the
applicable Calculation Date, provided the Borrower shall have an
additional five (5) days to supply additional information to the
Agent from the date the Agent notifies the Borrower that the initial
reports have been deemed insufficient by the Agent.
(c) Minimum Debt Service Coverage. The Debt Service Coverage
for each Calculation Period determined on each Calculation Date
shall be not less than 1.50:1. The compliance with the Debt Service
Coverage covenant shall be tested by the Agent on the Calculation
Date with results based upon the most recent Calculation Period
results, as reasonably determined by the Agent in a manner
consistent with the procedures and methods utilized by the Agent in
analyzing the financial information provided by the Borrower prior
to closing. If such Debt Service Coverage covenant shall not be
satisfied on any Calculation Date, the Borrower shall prepay a
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sufficient amount of principal outstanding on the Loan such that if
such principal reduction had been made on the first day of the
Calculation Period the Debt Service Coverage covenant would have
been satisfied. It shall be an Event of Default if the Borrower
fails to make such a prepayment not later than the first to occur
of: (i) ten (10) Business Days after notice from Agent to the
Borrower properly requesting the payment, or (ii) if the Borrower
has failed to give Agent sufficient reports to enable Agent to make
the necessary calculations, forty-five (45) days following the
applicable Calculation Date, provided the Borrower shall have an
additional five (5) days to supply additional information to the
Agent from the date the Agent notifies the Borrower that the initial
reports have been deemed insufficient by the Agent.
(d) Minimum Fixed Charge Coverage. The Fixed Charge Coverage
for each Calculation Period determined on each Calculation Date
beginning for the Calculation Period ending on December 31, 2006
shall be not less than 1.25:1. The compliance with the Fixed Charge
Coverage covenant shall be tested by the Agent on the Calculation
Date with results based upon the most recent Calculation Period
results, as reasonably determined by the Agent in a manner
consistent with the procedures and methods utilized by the Agent in
analyzing the financial information provided by the Borrower prior
to closing. If such Fixed Charge Coverage covenant shall not be
satisfied on any Calculation Date, the Borrower shall prepay a
sufficient amount of principal outstanding on the Loan such that if
such principal reduction had been made on the first day of the
Calculation Period the Fixed Charge Coverage covenant would have
been satisfied. It shall be an Event of Default if the Borrower
fails to make such a prepayment not later than the first to occur
of: (i) ten (10) Business Days after notice from Agent to the
Borrower properly requesting the payment, or (ii) if the Borrower
has failed to give Agent sufficient reports to enable Agent to make
the necessary calculations, forty-five (45) days following the
applicable Calculation Date, provided the Borrower shall have an
additional five (5) days to supply additional information to the
Agent from the date the Agent notifies the Borrower that the initial
reports have been deemed insufficient by the Agent
7.26.2 Consolidated Leverage Ratio. The quotient resulting from
dividing (i) the sum of (1) the Borrower's and the REIT's Pro Rata share
of the aggregate amount of all Debt respecting the Borrower, its
Subsidiaries and Investments (including, without limitation, the
outstanding balance of the Loan, but excluding the Debt under the Repo
Agreement) by (ii) the REIT's Total Asset Value, all as reasonably
determined by the Agent in a manner consistent with the procedures and
methods utilized by the Agent in analyzing the financial information
provided by the Borrower prior to closing, shall at all times be less than
sixty (60%) percent.
The compliance with the Consolidated Leverage Ratio covenant shall be
tested by the Agent on the Calculation Date with results based upon then
current financial information, as reasonably determined solely by the
Agent. If such Consolidated Leverage Ratio covenant shall not be satisfied
on any Calculation Date, the Borrower shall prepay a sufficient amount of
principal outstanding on the Loan such that if such principal reduction
had been made on the Calculation Date the Consolidated Leverage Ratio
covenant would have been satisfied on such Calculation Date. It shall be
an Event of Default if the Borrower fails to make such a prepayment not
later than the first to occur of: (i) ten (10) Business Days after Notice
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from Agent to the Borrower properly requesting the payment, or (ii) if the
Borrower has failed to give Agent and each of the Lenders sufficient
reports to enable Agent to make the necessary calculations, forty-five
(45) days following the applicable Calculation Date, provided the Borrower
shall have an additional five (5) days to supply additional information to
the Agent from the date the Agent notifies the Borrower that the initial
reports have been deemed insufficient by the Agent.
7.26.3 Minimum Net Worth. The Net Worth of the REIT shall at all
times be equal to or greater than $100,000,000.00, plus 75% of the amount
of any net proceeds received by the REIT in connection with any securities
issuances or offerings consummated from and after the Closing Date. The
compliance with the Minimum Net Worth covenant shall be tested by the
Agent on each Calculation Date. If such Minimum Net Worth covenant shall
not be satisfied on any Calculation Date, the Borrower shall prepay a
sufficient amount of principal outstanding on the Loan such that if such
principal reduction had been made on the Calculation Date the Minimum Net
Worth covenant would have been satisfied on such Calculation Date. It
shall be an Event of Default if the Borrower fails to make such a
prepayment not later than the first to occur of: (i) ten (10) Business
Days after Notice from Agent to the Borrower properly requesting the
payment, or (ii) if the Borrower has failed to give Agent and each of the
Lenders sufficient reports to enable Agent to make the necessary
calculations, forty-five (45) days following the applicable Calculation
Date, provided the Borrower shall have an additional five (5) days to
supply additional information to the Agent from the date the Agent
notifies the Borrower that the initial reports have been deemed
insufficient by the Agent.
7.26.4 Dividend Payout. Distributions or dividends made by the
Borrower to the REIT, and by the REIT to its owners, shall not exceed 100%
of Adjusted Earnings, to be calculated on a trailing twelve-month basis,
provided however, distributions or dividends may be paid to the extent
necessary to maintain the status of the REIT as a real estate investment
trust.
7.26.5 Minimum Liquidity. The sum of all of the REIT's Liquid Assets
(excluding, however, the Liquid Assets of any Borrower Subsidiary as to
which there exists a default or event of default on any Debt of such
Borrower Subsidiary) must at all times be at least $10,000,000.00, as
evidenced by the REIT's annual and quarterly SEC filings. If such Minimum
Liquidity shall not be satisfied on any date of testing, the REIT shall
arrange for an infusion of Liquid Assets in an amount necessary to satisfy
the requirements of this Section 7.28.5. It shall be an Event of Default
if the REIT fails to arrange for any required additional Liquid Assets not
later than ten (10) Business Days after Notice from Agent to the Borrower
notifying the Borrower of the noncompliance.
ARTICLE 8
NEGATIVE COVENANTS.
The Borrower covenants and agrees that from the date hereof and so long as
any Obligations remain outstanding hereunder, the Borrower shall not (and shall
not suffer or permit the other Loan Parties and/or the Borrower Subsidiaries
to):
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8.1 No Changes to the Borrower and other Loan Parties
Without the prior written consent of the Agent, which consent will not be
unreasonably withheld, after not less than thirty (30) days' prior written
notice (with reasonable particularity of the facts and circumstances attendant
thereto):(i) change its jurisdiction of organization, (ii) change its
organizational structure or type, (iii) change its legal name, or (iv) change
the organizational number (if any) assigned by its jurisdiction of formation or
its federal employer identification number (if any).
8.2 Restrictions on Liens
Create, incur, assume or suffer to exist any Lien upon or with respect to
any property or assets (real or personal, tangible or intangible, including,
without limitation, the Individual Properties), whether now owned or hereafter
acquired, or sell any such property or assets subject to an understanding or
agreement, contingent or otherwise, to repurchase such property or assets
(including sales of accounts receivable with recourse) or assign any right to
receive income or permit the filing of any financing statement under the UCC or
any other similar notice of Lien under any similar recording or notice statute,
or grant rights with respect to, or otherwise encumber or create a security
interest in, such property or assets (including, without limitation, any item of
Collateral) or any portion thereof or any other revenues therefrom or the
proceeds payable upon the sale, transfer or other disposition of such property
or asset or any portion thereof, or permit or suffer any such action to be
taken, except the following (singly and collectively, "Permitted Liens"):
8.2.1 Liens created by the Loan Documents;
8.2.2 Liens for taxes, assessments or other governmental charges not
yet delinquent or which are being diligently contested in good faith and
by appropriate proceedings, if (x) reasonable reserves in an amount not
less than the tax, assessment or governmental charge being so contested
shall have been established in a manner reasonably satisfactory to the
Agent or deposited in cash (or cash equivalents) with the Agent to be held
during the pendency of such contest, or such contested amount shall have
been duly bonded in accordance with applicable law, (y) no risk of sale,
forfeiture or loss of any interest in any Individual Property or the
Collateral or any part thereof arises during the pendency of such contest
and (z) such contest does not have and could not reasonably be expected to
have a Material Adverse Effect;
8.2.3 Liens in respect of property or assets imposed by law, which
were incurred in the ordinary course of business and do not secure Debt,
such as carriers', warehousemen's, materialmen's and mechanics' liens and
other similar Liens arising in the ordinary course of business, and (x)
which do not in the aggregate materially detract from the value of any
property or assets or have, and could not reasonably be expected to have,
a Material Adverse Effect or (y) which are being contested in good faith
by appropriate proceedings, which proceedings have the effect of
preventing the forfeiture or sale of the property or assets subject to any
such Lien;
8.2.4 Liens existing as of the Closing Date in favor of the holders
of the Subsidiary Debt;
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8.2.5 A Lien on a Borrower Subsidiary asset which may be granted to
secure Permitted Debt; and
8.2.6 To the extent that the Borrower or any Borrower Subsidiary or
any Loan Party acquires any other asset, any Lien as to which the
acquisition of such asset is subject.
8.3 Consolidations, Mergers, Sales of Assets, Issuance and Sale of Equity
(i) Dissolve, terminate, liquidate, consolidate with or merge with or into
any other Person, (ii) issue, sell, lease, transfer or assign to any Persons or
otherwise dispose of (whether in one transaction or a series of transactions)
any portion of its assets (whether now owned or hereafter acquired), including,
without limitation, any securities, membership or partnership interests, or
other interests of any kind in any other Loan Party or Borrower Subsidiary,
directly or indirectly (whether by the issuance of rights of, options or
warrants for, or securities convertible into, any such security, membership or
partnership interests or other interests of any kind), (iii) withdraw from or
resign as general partner or managing member of any Person, including, without
limitation, any withdrawal or resignation of: (x) the REIT as general partner of
the Borrower, (iv) permit another Person to merge with or into it, (v) acquire
all or substantially all the capital stock, membership or partnership interests
or assets of any other Person, or (vi) take any action which could have the
effect, directly or indirectly, of diluting the economic interest of any Loan
Party in any other Loan Party or Borrower Subsidiary; except the following:
8.3.1 Transfers pursuant to the Security Documents and other
agreements in favor of Agent on behalf of the Lenders;
8.3.2 Transfers or mergers to facilitate a Permitted Investment (to
the extent required, the Agent shall release any security interest which
it may have thereon to effectuate such transfer or merger);
8.3.3 Mergers, consolidations, transfers and sales between and among
Loan Parties of partnership interests, membership interests or capital
stock, so long as after giving effect to any such merger, consolidation,
transfer or sale, the Agent shall have a security interest, directly or
through its security interest in the partnership interests, membership
interests or capital stock of another Loan Party, in the partnership
interests, membership interests or capital stock of each Borrower
Subsidiary which is the survivor of such merger or consolidation or the
recipient of such partnership interests, membership interests or capital
stock transferred and/or sold, provided that in no event may any such
merger, consolidation, transfer or sale cause a Change of Control or
otherwise adversely affect the interests of the Agent and/or the Lenders,
as determined solely by the Agent;
8.3.4 Sales of any Individual Property or other Investment or the
ownership interest of the Borrower in any Property Owner or, with the
prior consent of the Agent; provided (a) the Agent receives the Mandatory
Principal Payment (if any) required under Section 2.5.1(a) above, (b) the
Borrower submits to the Agent an Officer's Certificate reflecting a
pro-forma calculation that such sale will not result in a failure to
comply with any Financial Covenants considering the consequences of the
sale (to the extent required, the Agent shall release any security
interest which it may have thereon to effectuate such sale);
43
8.3.5 Sales or dispositions in the ordinary course of business of
worn, obsolete or damaged items of personal property or fixtures which are
suitably replaced (to the extent required, the Agent shall release any
security interest which it may have thereon to effectuate such sale or
disposition);
8.3.6 Leases to the extent provided for herein;
8.3.7 The issuance of equity interests in the Borrower or the REIT,
provided no Change in Control shall occur; and
8.3.8 Transactions, whether outright or as security, for which
Agent's prior written consent has been obtained.
8.4 Restrictions on Debt
(i) Create, incur or assume any Debt, (ii) enter into, acquiesce, suffer
or permit any amendment, restatement or other modification of the documentation
evidencing and/or securing any Debt under which it is an obligor, or (iii)
increase the amount of any Debt existing as of the Closing Date; except with
respect to the following (singly and collectively, "Permitted Debt"):
8.4.1 The Obligations;
8.4.2 The following Debt existing as of the Closing Date in the
amount disclosed to the Agent hereunder:
(a) the Subsidiary Debt (none of which is recourse to the
Borrower, except for the type of recourse obligation set forth in
Section 8.4.3, below);
(b) Debt described in Schedule 8.4.2(b) annexed hereto;.
8.4.3 With respect to any Debt incurred by any Borrower Subsidiary,
obligations under (i) limited guaranties by the Borrower as to usual and
customary exceptions to non-recourse provisions (e.g., fraud and
misappropriation of funds) provided that such limited guaranties are
evidenced by documentation approved by the Agent and (ii) indemnifications
by the Borrower as to usual Hazardous Materials issues relating to the
subject Individual Property provided that such indemnifications are
evidenced by documentation customary for transactions of that type;
8.4.4 Debt (which is non-recourse to the Borrower) incurred by any
Borrower Subsidiary;
8.4.5 Indebtedness incurred in the ordinary course of business under
capitalized lease and for the purchase of goods or services which are
payable, without interest, within thirty (30) days of billing; and
8.4.6 Transactions, whether secured or unsecured, for which Agent's
prior written consent has been obtained.
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Upon the incurrence of any such Debt by any Loan Party, the Agent shall
review and, as necessary, adjust the Borrowing Base to reflect the
incurrence of such Debt.
8.5 Respecting Individual Properties
Permit or otherwise suffer to occur any event such that the
representations and warranties of the Borrower set forth in Section 6.17 would
be untrue or misleading in any material respect.
8.6 Other Business
Enter into any line of business or make any material change in the nature
of its business, purposes or operations, except as otherwise specifically
permitted by this Agreement or the other Loan Documents.
8.7 Change of Control
Permit or otherwise suffer to occur any Change of Control.
8.8 Forgiveness of Debt
Cancel or otherwise forgive or release any Debt owed to it by any Person
if such cancellation, forgiveness or release of such Debt would cause the
Borrower to fail to comply with the Financial Covenants or have Loans
outstanding in excess of the Borrowing Base unless otherwise approved by the
Agent.
8.9 Affiliate Transactions
On and after the Closing Date, enter into, or be a party to, any
transaction with any Person who is an Affiliate of the Borrower, or any Borrower
Subsidiary, or any Loan Party, except for transactions with terms consistent
with arms length contracts with independent third parties.
8.10 Amendments; Terminations of Related Documents
Enter into, acquiesce in, suffer or permit any amendment, restatement or
other modification or termination of any of the Formation Documents, without the
express prior written consent of the Agent.
8.11 ERISA
Except for Code Section 401(k) plans, establish or be obligated to
contribute to any Plan.
8.12 Bankruptcy Filings
File a petition under any state or federal bankruptcy or insolvency laws
or the liquidation of all or a major portion of its assets or property.
8.13 Investment Company
45
Become an "investment company" or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended.
8.14 Holding Company
Become a "holding company," or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
8.15 Use of Proceeds
Permit the proceeds of the Loan, or any other accommodation at any time
made hereunder, to be used for any purpose which entails a violation of, or is
inconsistent with, Regulation T, U or X of the Board of Governors of the Federal
Reserve, or for any purpose other than those set forth in Section 1.3.
8.16 Distributions
Authorize, declare, or pay any Distributions on behalf of the Borrower,
except for Permitted Distributions or (ii) take any action which would amend,
modify, or terminate any Distribution due, or the terms of any Formation
Document relating to Distributions due, to the Borrower, or any Borrower
Subsidiary. The term "Permitted Distributions" shall mean, (x) distributions
contemplated by Section 7.26.4 and (y) so long as no Default or Event of Default
exists and is continuing, or would be created thereby, subject to requirements
set forth in Section 9.2, hereof, any Distributions by the Borrower and the REIT
in accordance with its Formation Documents.
8.17 Restrictions on Investments
Make or permit to exist or to remain outstanding any Investment except
which is or results in ("Permitted Investments"):
8.17.1 marketable direct or guaranteed general obligations of the
United States of America which mature within one year from the date of
purchase;
8.17.2 bank deposits, certificates of deposit and banker's
acceptances, or other obligations in or of the Lenders or banks located
within and chartered by the United States of America or a state and having
assets of over $500,000,000.00; and
8.17.3 the Borrower's Subsidiaries, subject in all instances to the
terms of this Agreement;
8.17.4 the acquisition of any asset related to the operation,
ownership or management of the Individual Properties or any of the other
assets of the Borrower or the Borrower Subsidiaries;
8.17.5 the acquisition of any asset related to the operation,
ownership or management of real estate properties consistent with the
Borrower's existing investments and otherwise permitted to be acquired by
the REIT in accordance with its organizational documents.
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8.18 Contracts of a Material or Significant Nature
Except for contracts otherwise complying with this Agreement, not enter
into any other contracts, agreements or purchase orders which would involve the
expenditure of more than $1,000,000.00 in any instance or $1,000,000.00 in the
aggregate without Agent's prior written consent, which consent shall not be
unreasonably withheld or delayed, but which consent may be conditioned upon a
demonstration by the Borrower to Agent's reasonable satisfaction that the
contract, agreement or purchase order is reasonable and that the Party entering
into such contract has adequate resources to pay and perform the same.
8.19 Negative Pledges, Etc.
Enter into any agreement subsequent to the Closing Date (other than a Loan
Document) which (a) prohibits the creation or assumption of any Lien upon any of
the Collateral, including, without limitation, any hereafter acquired property,
(b) specifically prohibits the amendment or other modification of this Agreement
or any other Loan Document, or (c) could reasonably be expected to have a
Material Adverse Effect.
8.20 Business Transactions
Conduct any business activities that relate, directly or indirectly, to
the Property Owners, their properties or assets through any Person other than
the Borrower and/or a Loan party, except pursuant to the structure of ownership
existing as of the Closing Date and disclosed to the Agent.
8.21 ▇▇▇▇▇▇▇ Pledged Securities. (i) Exercise (or permit the exercise of)
any rights to register the ▇▇▇▇▇▇▇ Pledged Securities except upon prior written
notice to the Agent, and unless the Borrower has executed and delivered to the
Agent such documents, instruments and agreements as may reasonably be required
by the Agent to continue the perfection of the Agent's security interest in such
common stock; (ii) agree to or permit any amendment, modification or termination
of the Registration Rights Agreement, (iii) fail to preserve all of the
Borrower's and/or the REIT's registration rights under the Registration Rights
Agreement, (iv) agree to or permit the waiver of any provisions of the
Registration Rights Agreement which benefit the Borrower, the REIT or their
successors and assigns, (v) register or cause the registration of the ▇▇▇▇▇▇▇
Pledged Securities without providing therein for the sale by the Agent of the
▇▇▇▇▇▇▇ Pledged Securities in event of the exercise by the Agent of the rights
upon default under the Ownership Interest Pledge and Security Agreement, and
(vi) impair the exercise by the Agent during an Event of Default of its rights
under the Registration Rights Agreement. Further, at the request of the Agent,
the Borrower shall cause NRT to register the ▇▇▇▇▇▇▇ Pledged Securities in
accordance with the terms of the Registration Rights Agreement. In addition, the
Borrower shall collaterally assign to the Agent all of its rights under the
Registration Rights Agreement and will obtain an acknowledgment by NRT that the
Agent, and its successors and assigns are entitled to the rights, benefits,
powers and privileges of the Borrower or the REIT thereunder.
ARTICLE 9
SPECIAL PROVISIONS.
9.1 Legal Requirements
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The Borrower, any Loan Party, or any Borrower Subsidiary may contest in
good faith any claim, demand, levy or assessment under any Legal Requirements or
taxes owed by any person or entity if: (i) the contest is based upon a material
question of law or fact raised by such Person in good faith; (ii) such Person
properly commences and thereafter diligently pursues the contest; (iii) the
contest will not materially impair the ability to ultimately comply with the
contested Legal Requirement should the contest not be successful; (iv)
reasonable reserves in an amount necessary to undertake and pay for such contest
and any corrective or remedial action then or thereafter reasonably likely to be
necessary shall have been established in a manner satisfactory to the Agent or
deposited in cash (or cash equivalents) with the Agent to be held during the
pendency of such contest, or such contested amount shall have been duly bonded
in accordance with applicable law; (v) if the contest relates to a Legal
Requirement under Environmental Law, the conditions set forth in the
Environmental Indemnity relating to such contests shall be satisfied; (vi) no
risk of sale, forfeiture or loss of any interest in any Individual Property or
the Collateral or any part thereof arises during the pendency of such contest;
and (vii) such contest does not have and could not reasonably be expected to
have a Material Adverse Effect.
9.2 Distributions.
9.2.1 Notice of Intention to Distribute. At least ten (10) Business
Days prior to making any Distribution to its owners, the Borrower shall
submit to Agent a written statement of its intent to make such
Distribution accompanied by an Officer's Certificate reflecting a
pro-forma calculation that the Borrower will be in compliance with the
Financial Covenants after the proposed Distribution, together with such
other documentation and information as Agent may reasonably require
("Notice of Intention to Distribute") in order to verify that the Borrower
is entitled to make a Distribution as provided for herein.
9.2.2 Current Information. Once Agent has received a Notice of
Intention to Distribute and a Distribution has been made in accordance
with the foregoing, subsequent Notices of Intention to Distribute
submitted within the next twelve (12) months shall not require the
submission of new financial information if the Borrower submits a sworn
affidavit and unconditional representation that there have been no
material adverse changes, unless Agent has a good faith basis for
requiring the same.
9.3 Limited Recourse Provisions.
9.3.1 Borrower Fully Liable. The Borrower shall be fully liable for
the Loan and the Obligations to each of the Lenders.
9.3.2 Additional Matters. Nothing contained in this Section 9.3 or
elsewhere shall: (i) limit the right of Agent or any of the Lenders to
obtain injunctive relief or to pursue equitable remedies under any of the
Loan Documents, excluding only any injunctive relief ordering payment of
obligations by any Person or entity for which personal liability does not
otherwise exist; or (ii) limit the liability of any attorney, law firm,
accountant or other professional who or which renders or provides any
written opinion or certificate to Agent or any of the Lenders in
connection with the Loan even though such person or entity may be a member
of the Borrower.
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9.4 Payment of Obligations
Upon the payment in full of the Obligations, in immediately available
funds, including, without limitation, all unreimbursed costs and expenses of the
Agent and of each Lender for which the Borrower is responsible, the Agent shall
release any security and other collateral interests, including, without
limitation, the Payment Direction Letters, rights of setoff and right to freeze
granted to the Agent as provided for herein and under the other Loan Documents
and shall execute and deliver such documents and termination statements as the
Borrower or any other Loan Party reasonably requests to evidence such
termination and release. However, such release by the Agent shall not be deemed
to terminate or release any Person from any obligation or liability under the
Loan Documents which specifically by its terms survives the payment in full of
the Obligations.
ARTICLE 10
EVENTS OF DEFAULT
The following provisions deal with Default, Events of Default, notice,
grace and cure periods, and certain rights of Agent following an Event of
Default.
10.1 Default and Events of Default
The term "Default" as used herein or in any of the other Loan Documents
shall mean an Event of Default, or any fact or circumstance which constitutes,
or upon the lapse of time, or giving of notice, or both, could constitute, an
Event of Default. The occurrence of any of the following events, respectively,
shall, subject to the giving of any notice or the expiration of any applicable
grace period referred to in Section 10.2 without the cure thereof, constitute an
"Event of Default" herein. Upon the occurrence of any Event of Default described
in Sections 10.1.8, any and all Obligations shall become due and payable without
any further act on the part of the Agent. Upon the occurrence of any other Event
of Default, the Agent may declare any and all Obligations immediately due and
payable. The occurrence and continuance of any Event of Default shall also
constitute, without notice or demand, a default under all other agreements
between the Agent and/or the Lenders and the Borrower and instruments and papers
heretofore, now, or hereafter given the Agent and/or the Lenders by the
Borrower.
10.1.1 Failure to Pay the Loan. The failure by the Borrower to pay
when due any principal of, interest on, or fees in respect of, the Loans.
10.1.2 Failure to Make Other Payments. The failure by the Borrower
to pay when due (or upon demand, if payable on demand) any payment the
Obligation other than any payment the Obligation on account of the
principal of, or interest on, or fees in respect of, the Loans.
10.1.3 Note, Security Documents, and Other Loan Documents. Any other
default in the performance of any term or provision of the Note, or of the
Security Documents, or of any of the other Loan Documents, or a breach, or
other failure to satisfy, any other term, provision, condition or warranty
under the Note, the Security Documents, or any other Loan Document,
regardless of whether any then undisbursed portion of the Loan is
sufficient to cover any payment of money required thereby, and the
specific grace period, if any, allowed for the default in question shall
have expired without such default having been cured.
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10.1.4 Default under Other Agreements. The occurrence of any breach
of any covenant or Obligation imposed by, or of any default under, any
agreement (including any Loan Document) between the Agent and/or the
Lenders and the Borrower, the other Loan Parties, and/or the Property
Owners or instrument given by the Borrower and such Persons to the Agent
and/or the Lenders in connection with the Facility and the expiry, without
cure, of any applicable grace period (notwithstanding that the Agent
and/or the Lenders may not have exercised all or any of its/their rights
on account of such breach or default).
10.1.5 Representations and Warranties. If any representation or
warranty made by the Borrower or by any of the other Loan Parties or the
Borrower Subsidiaries in the Loan Documents was untrue or misleading in a
manner which could reasonably be expected to have a Material Adverse
Effect.
10.1.6 Affirmative Covenants. The breach of any covenant contained
in ARTICLE 7 herein, including, without limitation, the Financial
Covenants.
10.1.7 Negative Covenants. The breach of any covenant contained in
ARTICLE 8 herein.
10.1.8 Financial Status and Insolvency.
(a) the Borrower shall: (i) admit in writing its inability to
pay its debts generally as they become due; (ii) file a petition in
bankruptcy or a petition to take advantage of any insolvency act;
(iii) make an assignment for the benefit of creditors; (iv) consent
to, or acquiesce in, the appointment of a receiver, liquidator or
trustee of itself or of the whole or any substantial part of its
properties or assets; (v) file a petition or answer seeking
reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under the Federal Bankruptcy laws or
any other applicable law; (vi) have a court of competent
jurisdiction enter an order, judgment or decree appointing a
receiver, liquidator or trustee of the Borrower, or of the whole or
any substantial part of the property or assets of the Borrower, and
such order, judgment or decree shall remain unvacated or not set
aside or unstayed for sixty (60) days; (vii) have a petition filed
against it seeking reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under the
Federal Bankruptcy laws or any other applicable law and such
petition shall remain undismissed for sixty (60) days; (viii) have,
under the provisions of any other law for the relief or aid of
debtors, any court of competent jurisdiction assume custody or
control of the Borrower or of the whole or any substantial part of
its property or assets and such custody or control shall remain
unterminated or unstayed for sixty (60) days; or (ix) have an
attachment or execution levied against any substantial portion of
the property of the Borrower or against any substantial portion of
the Collateral which is not discharged or dissolved by a bond within
thirty (30) days; or
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(b) any such event set forth in subsection (i) above shall
occur with respect to any other Loan Party, unless such event does
not result in a breach of the Financial Covenants or a required
payment under Section 2.5.1(a).
10.1.9 Loan Documents. If any Loan Document for any reason other
than the satisfaction in full of all Obligations shall cease to be in full
force and effect (other than in accordance with its terms), thereby
preventing the Agent and/or the Lenders from obtaining the practical
realization of the benefits thereof, or if any Loan Document shall be
declared null and void or any Loan Party shall claim or declare any such
Loan Document to no longer be in full force and effect or is null and
void, or if the Liens and security interests purported to be created by
any of the Loan Documents shall cease to be valid, perfected, first
priority (except as otherwise expressly provided herein) security
interests;
10.1.10 Judgments. One or more judgments or decrees shall be entered
against the Borrower or any other Loan Party or Borrower Subsidiary
involving a liability (not paid or fully covered by a reputable and
solvent insurance company) and such judgments and decrees either shall be
final and non-appealable or shall not be vacated, discharged or stayed or
bonded pending appeal for any period of sixty (60) consecutive days, and
the aggregate amount of all such judgments exceeds $500,000.00;
10.1.11 Default of Other Specified Debt and Related Documents. If a
Default or Event of Default (regardless of how or if defined) shall occur
under any Debt of (a) the Borrower, or (b) any Borrower Subsidiaries in
excess of $10,000,000.00 in any instance or $25,000,000.00 in the
aggregate;
10.1.12 ERISA. (i) If any Plan shall fail to satisfy the minimum
funding standard required for any plan year or part thereof or a waiver of
such standard or extension of any amortization period is sought or granted
under Section 412 of the Code, any Plan shall have had or is likely to
have a trustee appointed to administer such Plan, any Plan is, shall have
been or is likely to be terminated or to be the subject of termination
proceedings under ERISA, any Plan shall have an Unfunded Current
Liability, a contribution required to be made to a Plan has not been
timely made, the Borrower or any Borrower Subsidiary or any ERISA
Affiliate has incurred or is likely to incur a liability to or on account
of a Plan under Section 409, 502(i), 502(l), 515, 4062, 4063, 4064, 4069,
4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971, 4975 or 4980 of
the Code, or the Borrower or any Borrower Subsidiary has incurred or is
likely to incur liabilities pursuant to one or more employee welfare
benefit plans (as defined in Section 3(l) of ERISA) that provide benefits
to retired employees or other former employees (other than as required by
Section 601 of ERISA) or employee pension benefit plans (as defined in
Section 3(2) of ERISA) and any of the foregoing could have a Material
Adverse Effect; (ii) if there shall result from any such event or events
the imposition of a lien, the granting of a security interest, or a
liability or a material risk of incurring a liability which could have, or
reasonably be expected to have, a Material Adverse Effect; or (iii) if
which lien, security interest or liability, individually, and/or in the
aggregate, in the opinion of the Agent could have, or reasonably be
expected to have, a Material Adverse Effect.
10.1.13 Change of Control. If a Change of Control shall occur.
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10.1.14 Indictment; Forfeiture. The indictment of, or institution of
any legal process or proceeding against, the Borrower, any other Loan
Party, and/or any Borrower Subsidiary under any applicable law where the
relief, penalties, or remedies sought or available include the forfeiture
of any property of the Borrower and/or any other such Person and/or the
imposition of any stay or other order, the effect of which could
reasonably be expected to have a Material Adverse Effect.
10.1.15 Default of Other Obligations. Any failure by the Borrower to
pay at maturity, or within any applicable grace period, any obligation for
borrowed money, or in respect of any capitalized lease, or any failure to
observe or perform any material term, covenant or agreement contained in
any agreement by which the Borrower is bound, evidencing or securing
borrowed money, or in respect of any capitalized lease, such that the
holder or holders thereof or of any obligations issued thereunder have
accelerated the maturity thereof.
10.1.16 Termination of Guaranty or the Borrower Consent. The
termination or attempted termination of (i) any Guaranty by any Guarantor
of the Obligations, or (ii) any Indemnification by any Indemnitor.
10.1.17 Generally. A default by the Borrower in the performance of
any term, provision or condition of this Agreement to be performed by the
Borrower, or a breach, or other failure to satisfy, any other term
provision, condition, covenant or warranty under this Agreement and such
default remains uncured beyond any applicable specific grace period
provided for in this Agreement, or as set forth in Section 10.2. below.
10.2 Grace Periods and Notice
As to each of the foregoing events the following provisions relating to
grace periods and notice shall apply:
10.2.1 No Notice or Grace Period. Except for any grace or notice
period specifically provided for in any referenced section of this
Agreement, there shall be no grace period and no notice provision with
respect to the payment of principal at maturity and no grace period and no
notice provision with respect to defaults related to the voluntary filing
of bankruptcy or reorganization proceedings or an assignment for the
benefit of creditors, or with respect to a breach of warranty or
representation as set forth in Section 10.1.5, or with respect to the
breach of any of the affirmative covenants set forth in Sections 7.26.1,
7.26.3, and 7.26.3.
10.2.2 Nonpayment of Interest and Principal. As to the nonpayment of
interest, installments of principal, and in connection with a Mandatory
Principal Prepayment prior to maturity there shall be a ten (10) Business
Day grace period without any requirement of notice from Agent.
10.2.3 Other Monetary Defaults. All other monetary defaults shall
have a five (5) Business Day grace period following notice from Agent.
10.2.4 Nonmonetary Defaults.
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(a) As to non-monetary default under Section 7.2, 7.5, 7.17,
7.20, or 7.21, or with respect to the breach of any of the negative
covenants set forth in Article 8, there shall be a ten (10) day
grace period following notice from Agent of such default;
(b) As to non-monetary default under Section 7.16, there shall
be a five (5) day grace period following notice from Agent of such
default;
(c) As to any other non-monetary default, unless there is a
specific shorter or longer grace period provided for in this Loan
Agreement or in another Loan Document, there shall be a thirty (30)
day grace period following notice from Agent or, if such default
would reasonably require more than thirty (30) days to cure or
remedy, such longer period of time not to exceed a total of ninety
(90) days from Agent's notice as may be reasonably required so long
as Borrower shall commence reasonable actions to remedy or cure the
default within thirty (30) days following such notice and shall
diligently prosecute such curative action to completion within such
ninety (90) day period. However, where there is an emergency
situation in which there is danger to person or property such
curative action shall be commenced as promptly as possible. As to
breaches of warranties and representations (other than those related
to financial information) there shall be a thirty (30) day grace
period following notice from Agent.
ARTICLE 11
REMEDIES.
11.1 Remedies
Upon the occurrence and during the continuance of an Event of Default,
whether or not the indebtedness evidenced by the Notes and secured by the
Security Documents shall be due and payable or Agent shall have instituted any
foreclosure or other action for the enforcement of the Security Documents or the
Notes, Agent may, and shall upon the direction of the Required Lenders, in
addition to any other remedies which Agent may have hereunder or under the other
Loan Documents, or otherwise, and not in limitation thereof, and in Agent's sole
and absolute discretion:
11.1.1 Accelerate Debt. Agent may, and with the direction of the
Required Lenders shall, declare the indebtedness evidenced by the Notes
and secured by the Security Documents immediately due and payable
(provided that in the case of a voluntary petition in bankruptcy filed by
the Borrower or an involuntary petition in bankruptcy filed against the
Borrower (after expiration of the grace period, if any, set forth in
Section 10.1.8), such acceleration shall be automatic).
11.1.2 Terminate Commitments. If any Event of Default shall occur
and be continuing, the Agent may, by notice to Borrower, terminate the
obligation of the Lenders to fund Loans in respect of the then unfunded
portion of the Facility, and, upon such notice being given, such
obligation of the Lenders to make any further Loans in respect of the then
unfunded portion of the Facility shall terminate immediately and the
Lenders shall be relieved of all further obligations to make any Loans to
Borrower.
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11.1.3 Pursue Remedies. Agent may, and with the direction of the
Required Lenders shall, pursue any and all remedies provided for
hereunder, under any one or more of the other Loan Documents, and/or
otherwise.
11.2 Written Waivers
If a Default or an Event of Default is waived by the Required Lenders, in
their sole discretion, pursuant to a specific written instrument executed by an
authorized officer of Agent, the Default or Event of Default so waived shall be
deemed to have never occurred.
11.3 Power of Attorney
For the purpose of exercising the rights granted by this Article 11, as
well as any and all other rights and remedies of Agent under the Loan Documents,
the Borrower hereby irrevocably constitutes and appoints Agent (or any agent
designated by Agent) its true and lawful attorney-in-fact, with full power of
substitution, upon the occurrence and during the continuance of any Event of
Default, to execute, acknowledge and deliver any instruments and to do and
perform any acts in the name and on behalf of the Borrower. In connection with
the foregoing power of attorney, the Borrower hereby grants unto the Agent
(acting through any of its officers) full power to do any and all things after
the occurrence and during the continuance of an Event of Default necessary or
appropriate in connection with the exercise of such powers as fully and
effectually as the Borrower might or could do, hereby ratifying all that said
attorney shall do or cause to be done by virtue of this Agreement. The foregoing
power of attorney shall not be affected by any disability or incapacity suffered
by the Borrower and shall survive the same. All powers conferred upon the Agent
by this Agreement, being coupled with an interest, shall be irrevocable until
this Agreement is terminated by a written instrument executed by a duly
authorized officer of the Agent.
ARTICLE 12
SECURITY INTEREST AND SET-OFF.
12.1 Security Interest
The Borrower hereby grants to the Agent and each of the Lenders, a
continuing lien, security interest and right of setoff as security for all of
the Obligations to Agent and each of the Lenders, whether now existing or
hereafter arising, upon and against all Depository Accounts, Accounts, deposits,
credits, collateral and property, now or hereafter in the possession, custody,
safekeeping or control of Agent or any of the Lenders or any entity under the
control of KeyBank National Association and its successors and assigns, or in
transit to any of them.
12.2 Set-Off
After the occurrence and during the continuance of any Event of Default,
any such Depository Accounts, Accounts, deposits, balances or other sums
credited by or due from Agent, any affiliate of Agent or any of the Lenders, or
from any such affiliate of any of the Lenders, to the Borrower may to the
fullest extent not prohibited by applicable law at any time or from time to
time, without regard to the existence, sufficiency or adequacy of any other
collateral, and without notice or compliance with any other condition precedent
now or hereafter imposed by statute, rule of law or otherwise, all of which are
hereby waived, be set off, appropriated and applied by Agent against any or all
of the Borrower's Obligations irrespective of whether demand shall have been
54
made, in such manner as Agent in its sole and absolute discretion may determine.
Within three (3) Business Days of making any such set off, appropriation or
application, Agent agrees to notify the Borrower thereof, provided the failure
to give such notice shall not affect the validity of such set off or
appropriation or application. ANY AND ALL RIGHTS TO REQUIRE AGENT OR ANY OF THE
LENDERS TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL
WHICH SECURES A LOAN, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO
SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF SUCH BORROWER OR ANY GUARANTOR, ARE
HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.
12.3 Application
Each of the Lenders agrees with each other Lender that with respect to
this Agreement or under any other Loan Document (a) if an amount to be set off
is to be applied to indebtedness of the Borrower or any other Loan Party to such
Lender, other than the respective Obligations due to such Lender, such amount
shall be applied ratably to such other indebtedness and to the Borrower's
Obligations due to such Lender, and (b) if such Lender shall receive from the
Borrower or any other Loan Party, whether by voluntary payment, exercise of the
right of setoff, counterclaim, cross action, enforcement of the claim due to
such Lender by proceedings against the Borrower or any other Loan Party at law
or in equity or by proof thereof in bankruptcy, reorganization, liquidation,
receivership or similar proceedings, or otherwise, and shall retain and apply to
the payment of the Obligations due to such Lender any amount in excess of its
ratable portion of the payments received by all of the Lenders with respect to
the Borrower's Obligations due to all of the Lenders, such Lender will make such
disposition and arrangements with the other Lenders with respect to such excess,
either by way of distribution, pro tanto assignment of claims, subrogation or
otherwise as shall result in each Lender receiving in respect of the subject
Obligations its proportionate payment as contemplated by this Agreement;
provided that if all or any part of such excess payment is thereafter recovered
from such Lender, such disposition and arrangements shall be rescinded and the
amount restored to the extent of such recovery, but without interest.
12.4 Right to Freeze
The Agent and each of the Lenders shall also have the right, at its
option, upon the occurrence and during the continuance of any event which would
entitle the Agent and each of the Lenders to set off or debit as set forth in
Section 12.2, to freeze, block or segregate any such deposits, balances and
other sums so that the Borrower may not access, control or draw upon the same.
12.5 Additional Rights
The rights of Agent, the Lenders and each affiliate of Agent and each of
the Lenders under this Article 12 are in addition to, and not in limitation of,
other rights and remedies, including other rights of set off, which Agent or any
of the Lenders may have.
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ARTICLE 13
THE AGENT AND THE LENDERS
13.1 Appointment
KeyBank National Association is hereby appointed as Agent hereunder and
under each other Loan Document, and each Lender hereby irrevocably authorizes
the Agent to act as agent for Lender and to take such actions as Lender is
obligated or entitled to take under the provisions of this Agreement and the
other Loan Documents. Agent agrees to act as such upon the express conditions
contained in this Article in substantially the same manner that it would act in
dealing with a loan held for its own account. Agent shall not have a fiduciary
relationship with respect to any Lender by reason of this Agreement. The
provisions of this ARTICLE 13 which do not expressly grant Borrower certain
rights by direct reference to Borrower are solely for the benefit of the Agent
and the Lenders, and Borrower shall not have any rights as a third party
beneficiary of any of the provisions hereof. In performing its functions and
duties under this Agreement, the Agent shall act solely as agent of Lender and
does not assume, and shall not be deemed to have assumed, any obligations toward
or relationship of agency or trust with or for the Borrower, provided, however,
that nothing contained in this ARTICLE 13 shall be deemed to release Agent or
the Lenders from any of their obligations under this Agreement.
13.2 Reliance on Agent
All acts of and communications by the Agent, as agent for the Lenders,
shall be deemed legally conclusive and binding; and Borrower or any third party
(including any court) shall rely on any and all communications or acts of the
Agent with respect to the exercise of any rights or the granting of any consent,
waiver or approval on behalf of a Lender in all circumstances where an action by
such Lender is required or permitted pursuant to this Agreement or the
provisions of any other Loan Document or by applicable law without the right or
necessity of making any inquiry of any individual Lender as to the authority of
Agent with respect to such matter. In no event shall any of the foregoing limit
the rights or obligations of any Lender with respect to any other Lender
pursuant to this ARTICLE 13.
13.3 Powers
The Agent shall have and may exercise such powers under the Loan Documents
as are specifically delegated to the Agent by the terms of each thereof,
together with such powers as are reasonably incidental thereto or are otherwise
necessary or desirable in connection with the administration of the Loan, and
may exercise all other powers of Lender as are not made subject to the consent
of the Required Lenders pursuant to Section 13.26.1 or to the consent of all
Lenders pursuant to Section 13.26.2. Without limiting the foregoing, the Agent
may consent to or execute easements, plats, dedications, release of minor
portions of the collateral and similar documents. The Agent shall not be
considered, or be deemed, a separate agent of the Lenders hereunder, but is, and
shall be deemed, acting in its contractual capacity as Agent, exercising such
rights and powers under the Loan Documents as are specifically delegated to the
Agent or Agent is otherwise entitled to take hereunder. Agent shall have no
implied duties to the Lenders, or any obligation to the Lenders to take any
action except any action specifically provided by the Loan Documents to be taken
by the Agent.
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13.4 Disbursements.
13.4.1 At least two (2) Business Days (by 11:00 a.m. Eastern Time)
prior to each date a disbursement of a Loan is to be made hereunder
pursuant to this Agreement (or at least two (2) LIBOR Business Days by
11:00 a.m. Eastern Time for any disbursements to be made at the Adjusted
LIBOR Rate), the Agent shall notify each Lender of the proposed
disbursement. Each Lender shall make available to Agent (or the funding
Lender or entity designated by the Agent), the amount of such Lender's
Percentage of such disbursement (with respect to such Lender, such amount
being referred to herein as an "Advance") in immediately available funds
not later than 11:00 a.m. Eastern Time on the date such disbursement is to
be made (such date being referred to herein as a "Funding Date"). Unless
the Agent shall have been notified by any Lender prior to such time for
funding in respect of any Advance that such Lender does not intend to make
available to the Agent such Lender's Advance, the Agent may assume that
such Lender has made such amount available to the Agent and the Agent, in
its sole discretion, may, but shall not be obligated to, make available to
Borrower a corresponding amount. If such corresponding amount is not in
fact made available to the Agent by such Lender on or prior to the
respective Funding Date, such Lender agrees to pay and Borrower agrees to
repay to Agent forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made available
to Borrower until the date such amount is paid or repaid to Agent, at (A)
in the case of such Lender, the Federal Funds Effective Rate, and (B) in
the case of Borrower, the interest rate applicable at the time to a
disbursement made on such Funding Date. If such Lender shall pay to Agent
such corresponding amount, such amount so paid shall constitute such
Lender's Advance, and if both such Lender and Borrower shall have paid and
repaid, respectively, such corresponding amount, Agent shall promptly
return to Borrower such corresponding amount in same day funds. If any
Lender declines to make available to Agent such Lender's advance as
described above, so long as no Event of Default has occurred and is
continuing, upon written demand of Borrower, the Borrower may require such
Lender to sell and assign its entire interest in the Loans pursuant to
Section 13.22 hereof to an Eligible Assignee, reasonably approved by
Agent, upon payment by such Eligible Assignee of the entire par amount of
such Lender's interest.
13.4.2 Requests by the Agent for funding by the Lenders of
disbursements of the Loan will be made by facsimile. Each Lender shall
make its Advance available to the Agent in dollars and in immediately
available funds to such Lender and account as the Agent may designate, not
later than Noon Eastern Time on the Funding Date. Nothing in this Section
13.4 shall be deemed to relieve any Lender of its obligation hereunder to
make any Advance on any Funding Date, nor shall any Lender be responsible
for the failure of any other Lender to perform its obligations to make any
Advance hereunder, and the Commitment of any Lender shall not be increased
or decreased as a result of the failure by any other Lender to perform its
obligation to make any Advances hereunder.
13.4.3 As soon as practical Agent will promptly forward to each
Lender copies of any draw request documents and, if applicable, cause the
Lender's Consultant to forward to each Lender a copy of the Lender's
Consultant's most recent inspection. Delivery of the draw request
documents and the Lender's Consultant's inspection report shall not be a
condition to funding any Advance.
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13.5 Distribution and Apportionment of Payments.
13.5.1 Subject to Section 13.5.4, payments actually received by
Agent for the account of the Lenders shall be paid to them promptly after
receipt thereof by Agent, but in any event within one (1) Business Day,
provided that, if any such payments are not distributed to the Lenders
within one (1) Business Day after Agent's receipt thereof, Agent shall pay
to such Lenders interest thereon, at the lesser of (i) the Federal Funds
Effective Rate and (ii) if the applicable payment represents repayment of
a portion of the principal of the Loan, the rate of interest applicable to
such portion of the Loan, from the date of receipt of such funds by Agent
until such funds are paid in immediately available funds to such Lenders
provided such funds are received by Agent not later than 11:00 A.M.
Eastern Time on the date of receipt. All payments of principal and
interest in respect of the Loan, all payments of the fees described in
this Agreement (but not in any separate fee letter except to the extent
expressly set forth therein), and all payments in respect of any other
obligations of Borrower under the Loan Documents shall be allocated among
such of Lenders as are entitled thereto, in proportion of their respective
Percentages or otherwise as provided herein or in the other Loan
Documents, as the case may be. The Agent shall distribute to each Lender
at its primary address set forth herein or in its Assignment and
Assumption, or at such other address as a Lender may request in writing,
such funds as it may be entitled to receive, provided that the Agent shall
in any event not be bound to inquire into or determine the validity, scope
or priority of any interest or entitlement of any Lender and may suspend
all payments and seek appropriate relief (including without limitation
instructions from the Required Lenders, or all Lenders, as applicable, or
an action in the nature of interpleader) in the event of any doubt or
dispute as to any apportionment or distribution contemplated hereby. The
order of priority herein is set forth solely to determine the rights and
priorities of the Lenders as among themselves and may at any time or from
time to time be changed by the Lenders as they may elect, in writing,
without necessity of notice to or consent of or approval by Borrower. The
Agent shall upon each distribution noted above promptly notify Borrower of
such distribution and each Lender of the amounts so distributed to it
applicable to principal of, and interest on, the proportionate share held
by the applicable Lender. Each payment to the Agent by Borrower as noted
in this Section shall constitute a payment by the Borrower to each Lender
in the amount of such Lender's proportionate of such payment, and any such
payment to the Agent shall not be considered outstanding for any purpose
after the date of such payment by the Borrower to the Agent without regard
to whether or when the Agent makes distribution thereof as provided above.
13.5.2 Distribution of Liquidation Proceeds. Subject to the terms
and conditions hereof, the Agent shall distribute all Liquidation Proceeds
in the order and manner set forth below:
First: To the Agent, towards any fees and any expenses for which the
Agent is entitled to reimbursement under this Agreement or the
other Loan Documents not theretofore paid to the Agent.
Second: To all applicable Lenders in accordance with their proportional
share based upon their respective Percentages until all Lenders
have been reimbursed for all expenses which such Lenders have
previously paid to the Agent and not theretofore paid to such
Lenders.
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Third: Pro Rata to (a) all Lenders in accordance with their proportional
share based upon their respective Percentages until all Lenders
have been paid in full all principal and interest due to such
Lenders under the Loan, with each Lender applying such proceeds
for purposes of this Agreement against the outstanding principal
balance and accrued and unpaid interest due to such Lender under
the Loans in such fashion and priority as the Agent may direct,
and (b) to the Agent in connection with any Interest Rate
Protection Agreement (if any) or other hedging or protection
arrangement entered into by the Borrower or any other party with
the KeyBank National Association with respect to the Loan.
Fourth: To all applicable Lenders in accordance with their proportional
share based upon their respective Percentages until all Lenders
have been paid in full all other amounts due to such Lenders
under the Loans including, without limitation, any costs and
expenses incurred directly by such Lenders to the extent such
costs and expenses are reimbursable to such Lenders by the
Borrower under the Loan Documents.
13.5.3 Fifth: To the Borrower or such third parties as may be
entitled to claim Liquidation Proceeds.
13.5.4 If a Lender (a "Defaulting Lender") defaults in making any
Advance or paying any other sum payable by it hereunder, such sum together
with interest thereon at the Default Rate from the date such amount was
due until repaid (such sum and interest thereon as aforesaid referred to,
collectively, as the "Lender Default Obligation") shall be payable by the
Defaulting Lender (i) to any Lender(s) which elect, at their sole option
(and with no obligation to do so), to fund the amount which the Defaulting
Lender failed to fund or (ii) to Agent or any other Lender which under the
terms of this Agreement is entitled to reimbursement from the Defaulting
Lender for the amounts advanced or expended. Notwithstanding any provision
hereof to the contrary, until such time as a Defaulting Lender has repaid
the Lender Default Obligation in full, all amounts which would otherwise
be distributed to the Defaulting Lender shall instead be applied first to
repay the Lender Default Obligation (to be applied first to interest at
the Default Rate and then to principal) until the Lender Default
Obligation has been repaid in full (whether by such application or by cure
by the Defaulting Lender), whereupon such Lender shall no longer be a
Defaulting Lender. Any interest collected from Borrower on account of
principal advanced by any Lender(s) on behalf of a Defaulting Lender shall
be paid to the Lender(s) who made such advance and shall be credited
against the Defaulting Lender's obligation to pay interest on the amount
advanced at the Default Rate. If no other Lender makes an advance a
Defaulting Lender failed to fund, a portion of the indebtedness of
Borrower to the Defaulting Lender equal to the Lender Default Obligation
shall be subordinated to the indebtedness of Borrower to all other Lenders
and shall be paid only after the indebtedness of Borrower to all other
Lenders is paid. The provisions of this Section shall apply and be
effective regardless of whether an Event of Default occurs and is then
continuing, and notwithstanding (i) any other provision of this Agreement
to the contrary or (ii) any instruction of Borrower as to its desired
application of payments. No Defaulting Lender shall have the right to vote
on matters which are subject to the consent or approval of Required
Lenders or all Lenders and while any Lender is a Defaulting Lender the
requisite percentage of Lenders which constitutes the Required Lenders
59
shall be calculated exclusive of the Percentage of the Defaulting Lender.
The Agent shall be entitled to (i) withhold or set off, and to apply to
the payment of the Lender Default Obligation any amounts to be paid to
such Defaulting Lender under this Agreement, and (ii) bring an action or
suit against such Defaulting Lender in a court of competent jurisdiction
to recover the Lender Default Obligation and, to the extent such recovery
would not fully compensate the Lenders for the Defaulting Lender's breach
of this Agreement, to collect damages. In addition, the Defaulting Lender
shall indemnify, defend and hold Agent and each of the other Lenders
harmless from and against any and all claims, actions, liabilities,
damages, costs and expenses (including attorneys' fees and expenses), plus
interest thereon at the Default Rate, for funds advanced by Agent or any
other Lender on account of the Defaulting Lender or any other damages such
persons may sustain or incur by reason of or as a direct consequence of
the Defaulting Lender's failure or refusal to abide by its obligations
under this Agreement.
13.5.5 At least five Business Days prior to the first date on which
interest or fees are payable hereunder for the account of any Lender, each
Lender that is not incorporated under the laws of the United States of
America, or a state thereof, agrees that it will deliver to each of the
Agent and the Borrower two duly completed copies of United States Internal
Revenue Service Form W-8 BEN or W-8 ECI, certifying in either case that
such Lender is entitled to receive payments under this Agreement and the
Note without deduction or withholding of any United States federal income
taxes. Each Lender which so delivers a Form W-8 BEN or W-8 ECI further
undertakes to deliver to the Agent two additional copies of such form (or
a successor form) on or before the date that such form expires or becomes
obsolete or after the occurrence of any event requiring a change in the
most recent forms so delivered by it, and such amendments thereto or
extensions or renewals thereof as may be reasonably requested by the
Agent, in each case certifying that such Lender is entitled to receive
payments under this Agreement and the Note without deduction or
withholding of any United States federal income taxes, unless any change
in treaty, law or regulation has occurred after the initial delivery
required by this Section 13.5.5 but prior to the date on which any such
subsequent delivery would otherwise be required which renders all such
forms inapplicable or which would prevent such Lender from duly completing
and delivering any such form with respect to it and such Lender advises
the Agent that it is not capable of receiving payments without any
deduction or withholding of United States federal income tax, provided,
however, that if any such Lender so advises the Agent, Agent shall
promptly notify Borrower thereof, and so long as no Event of Default has
occurred and is continuing, upon written demand of Borrower, the Borrower
may require such Lender to sell and assign its entire interest in the
Loans pursuant to Section 13.22 hereof to an Eligible Assignee, reasonably
approved by Agent, upon payment by such Eligible Assignee of the entire
par amount of such Lender's interest.
13.6 Agency Provisions Relating to Collateral.
13.6.1 The Agent is hereby authorized on behalf of all Lenders,
without the necessity of any notice to or further consent from any Lender,
at any time and from time to time, to take any action with respect to any
collateral for the Loans or any Loan Document which may be necessary to
preserve and maintain such collateral or to perfect and maintain perfected
the liens upon such collateral granted pursuant to this Agreement and the
other Loan Documents.
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13.6.2 Except as provided in this Agreement, the Agent shall have no
obligation whatsoever to any Lender or to any other person or entity to
assure that any collateral exists or is owned by Borrower or is cared for,
protected or insured or has been encumbered or that the liens granted
herein or in any of the other Loan Documents or pursuant hereto or thereto
have been properly or sufficiently or lawfully created, perfected,
protected or enforced or are entitled to any particular priority.
13.6.3 Should the Agent commence any proceeding or in any way seek
to enforce the Agent's or the Lenders' rights or remedies under the Loan
Documents, irrespective of whether as a result thereof the Agent shall
acquire title to any collateral, each Lender, upon demand therefor from
time to time, shall contribute its share (based on its Percentage) of the
reasonable costs and/or expenses of any such enforcement or acquisition,
including, but not limited to, fees of receivers or trustees, court costs,
title company charges, filing and recording fees, appraisers' fees and
fees and expenses of attorneys to the extent not otherwise reimbursed by
Borrower. Without limiting the generality of the foregoing, each Lender
shall contribute its share (based on its Percentage) of all reasonable
costs and expenses incurred by the Agent (including reasonable attorneys'
fees and expenses) if the Agent employs counsel for advice or other
representation (whether or not any suit has been or shall be filed) with
respect to any collateral for the Loans or any part thereof, or any of the
Loan Documents, or the attempt to enforce any security interest or lien on
any collateral, or to enforce any rights of the Agent or the Lenders or
any of Borrower's or any other party's obligations under any of the Loan
Documents, but not with respect to any dispute between Agent and any other
Lender(s). It is understood and agreed that in the event the Agent
determines it is necessary to engage counsel for Lender from and after the
occurrence of a Default or Event of Default, said counsel shall be
selected by the Agent and written notice of such selection, together with
a copy of such counsel's engagement letter and fee estimate, shall be
delivered to the Lenders.
13.6.4 In the event that all or any portion of the collateral for
the Loans is acquired by the Agent as the result of the exercise of any
remedies hereunder or under any other Loan Document, or is retained in
satisfaction of all or any part of Borrower's obligations under the Loan
Documents, title to any such collateral or any portion thereof shall be
held in the name of the Agent or a nominee or subsidiary of Agent, as
agent, for the ratable benefit of the Agent and the Lenders. The Agent
shall prepare a recommended course of action for such collateral (the
"Post-Default Plan"), which shall be subject to the approval of the
Required Lenders. The Agent shall administer the collateral in accordance
with the Post-Default Plan, and upon demand therefor from time to time,
each Lender will contribute its share (based on its Percentage) of all
reasonable costs and expenses incurred by the Agent pursuant to the
Post-Default Plan, including without limitation, any operating losses and
all necessary operating reserves. To the extent there is net operating
income from such collateral, the Agent shall, in accordance with the
Post-Default Plan, determine the amount and timing of distributions to
Lenders. All such distributions shall be made to Lenders in accordance
with their respective Percentages. In no event shall the provisions of
this subsection or the Post-Default Plan require the Agent or any Lender
to take an action which would cause such Lender to be in violation of any
applicable regulatory requirements.
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13.7 Lender Actions Against Borrower or the Collateral
Each Lender agrees that it will not take any action, nor institute any
actions or proceedings, against Borrower or any other person hereunder or under
any other Loan Documents with respect to exercising claims against the Borrower
or rights in any collateral without the consent of the Required Lenders. With
respect to any action by the Agent to enforce the rights and remedies of the
Agent and Lenders with respect to the Borrower and any collateral in accordance
with the terms of this Agreement, each Lender hereby consents to the
jurisdiction of the court in which such action is maintained.
13.8 Assignment and Participation
No Lender shall be permitted to assign or sell all or any portion of its
rights and obligations under this Agreement to Borrower or any Affiliate of
Borrower.
13.9 Ratable Sharing
Subject to Sections 13.4 and 13.5, Lenders agree among themselves that (i)
with respect to all amounts received by them which are applicable to the payment
of the Loan, equitable adjustment will be made so that, in effect, all such
amounts will be shared among them ratably in accordance with their Percentages,
whether received by voluntary payment, by the exercise of the right of set-off
or bankers' lien, by counterclaim or cross action or by the enforcement of any
or all of the Loan Documents or any collateral and (ii) if any of them shall by
voluntary payment or by the exercise of any right of counterclaim, set-off,
bankers' lien or otherwise, receive payment of a proportion of the aggregate
amount of the Loans held by it which is greater than its Percentage of the
payments on account of the Loan, the one receiving such excess payment shall
purchase, without recourse or warranty, an undivided interest and participation
(which it shall be deemed to have done simultaneously upon the receipt of such
payment) in such obligations owed to the others so that all such recoveries with
respect to such obligations shall be applied ratably in accordance with their
Percentages; provided, that if all or part of such excess payment received by
the purchasing party is thereafter recovered from it, those purchases shall be
rescinded and the purchase prices paid for such participations shall be returned
to that party to the extent necessary to adjust for such recovery, but without
interest except to the extent the purchasing party is required to pay interest
in connection with such recovery. Borrower agrees that any Lender so purchasing
a participation from another Lender pursuant to this Section may, to the fullest
extent permitted by law, exercise all its rights of payment (including the right
of set-off) with respect to such participation as fully as if such Lender were
the direct creditor of Borrower in the amount of such participation.
13.10 General Immunity
Neither Agent nor any of its directors, officers, agents or employees
shall be liable to Borrower or any Lender for any action taken or omitted to be
taken by it or them hereunder or under any other Loan Document or in connection
herewith or therewith, except for its or their own gross negligence or willful
misconduct. In the absence of gross negligence, the Agent shall not be liable
for any apportionment or distribution of payments made by it in good faith
pursuant to Section 13.5, and if any such apportionment or distribution is
subsequently determined to have been made in error the sole recourse of any
Lender to whom payment was due, but not made, shall be to recover from the
recipients of such payments any payment in excess of the amount to which they
are determined to have been entitled.
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13.11 No Responsibility for Loan, Recitals, Etc.
Neither Agent nor any of its directors, officers, agents or employees
shall be responsible for or have any duty to ascertain, inquire into, or verify
(i) any statement, warranty or representation made in connection with any Loan
Document or any use of the Loans; (ii) the performance or observance of any of
the covenants or agreements of any party to any Loan Document; (iii) the
satisfaction of any condition specified in this Agreement, except receipt of
items purporting to be the items required to be delivered to any Agent; or (iv)
the validity, effectiveness or genuineness of any Loan Document or any other
instrument or writing furnished in connection therewith, provided that the
foregoing shall not release Agent from liability for its gross negligence or
willful misconduct.
13.12 Action on Instructions of Lenders
The Agent shall in all cases be fully protected in acting, or in
refraining from acting, hereunder and under any other Loan Document in
accordance with written instructions signed by all the Lenders (or the Required
Lenders, if such action may be directed hereunder by the Required Lenders), and
such instructions and any action taken or failure to act pursuant thereto shall
be binding on all of Lenders. Each Lender, severally to the extent of its
Percentage, hereby agrees to indemnify Agent against and hold it harmless from
any and all liability, cost and expense that it may incur by reason of taking or
continuing to take any such action, provided that the foregoing shall not
release Agent from liability for its gross negligence or willful misconduct.
13.13 Employment of Agents and Counsel
The Agent may undertake any of its duties as Agent hereunder and under any
other Loan Document by or through employees, agents, and attorneys-in-fact and
shall not be liable to Lenders, except as to money or securities received by
them or their authorized agents, for the default or misconduct of any such
agents or attorneys-in-fact selected by it with reasonable care. The Agent shall
be entitled to advice of counsel concerning all matters pertaining to the agency
hereby created and its duties hereunder and under any other Loan Document.
13.14 Reliance on Documents; Counsel
The Agent shall be entitled to rely upon any notice, consent, certificate,
affidavit, letter, telegram, statement, paper or document believed by it to be
genuine and correct and to have been signed or sent by the proper person or
persons, and, in respect to legal matters, upon the opinion of counsel selected
by the Agent, which counsel may be an employee of Agent, provided that the
foregoing shall not release the Agent from liability for its gross negligence or
willful misconduct. Any such counsel shall be deemed to be acting on behalf of
Lender in assisting the Agent with respect to the Loan, but shall not be
precluded from also representing Agent in any matter in which the interests of
Agent and the other Lenders may differ.
13.15 Agent' Reimbursement and Indemnification
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Lenders agree to reimburse and indemnify Agent ratably (i) for any amounts
(excluding principal and interest on the Loans and loan fees) not reimbursed by
Borrower for which Agent is entitled to reimbursement under the Loan Documents,
(ii) for any other expenses incurred by Agent on behalf of Lender, in connection
with the preparation, execution, delivery, administration and enforcement of the
Loan Documents, if not paid by Borrower, (iii) for any expenses incurred by
Agent on behalf of Lender which may be necessary or desirable to preserve and
maintain collateral or to perfect and maintain perfected the liens upon the
collateral granted pursuant to this Agreement and the other Loan Documents, if
not paid by Borrower, (iv) for any amounts and other expenses incurred by Agent
on behalf of Lender in connection with any default by any Lender hereunder or
under the other Loan Documents, if not paid by such Lender, and (v) for any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind and nature whatsoever which may be
imposed on, incurred by or asserted against Agent in any way relating to or
arising out of the Loan Documents or any other document delivered in connection
therewith or the transactions contemplated thereby, or the enforcement of any of
the terms thereof or of any such other documents, provided that no Lender shall
be liable for any of the foregoing to the extent they arise from the gross
negligence or willful misconduct of Agent.
13.16 Rights as a Lender
With respect to its Commitment, if any, Agent shall have the same rights,
powers and obligations hereunder and under any other Loan Document as any Lender
and may exercise such rights and powers as though it were not an Agent, and the
term "Lender" or "Lenders" shall, unless the context otherwise indicates,
include Agent in its individual capacities. The Borrower and each Lender
acknowledge and agree that Agent and/or its affiliates may accept deposits from,
lend money to, hold other investments in, and generally engage in any kind of
trust, debt, equity or other transaction or have other relationships, in
addition to those contemplated by this Agreement or any other Loan Document,
with Borrower or any of its affiliates in which Borrower or such affiliate is
not restricted hereby from engaging with any other person.
13.17 Lenders' Credit Decisions
Each Lender acknowledges that it has, independently and without reliance
upon the Agent or any other Lender and based on the financial statements and
other information prepared by Borrower and such other documents and information
as it has deemed appropriate, made its own credit analysis and decision to enter
into this Agreement and the other Loan Documents. Each Lender also acknowledges
that it will, independently and without reliance upon Agent or any other Lender
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement and the other Loan Documents.
13.18 Notice of Events of Default
Should Agent receive any written notice of the occurrence of a default or
Event of Default, or should the Agent send Borrower a notice of Default or Event
of Default, the Agent shall promptly furnish a copy thereof to each Lender.
13.19 Successor Agent.
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13.19.1 Notwithstanding anything contained in this Agreement to the
contrary, KeyBank National Association shall serve as Agent pursuant to
this Agreement until the earlier to occur of the following (the
"Resignation Event"): (a) the occurrence of an Event of Default, or (b)
the date upon which the Facility is terminated. Following such a
Resignation Event, Agent may resign from the performance of all its
functions and duties hereunder at any time by giving at least thirty (30)
days prior written notice to Lenders and Borrower. Such resignation shall
take effect on the date set forth in such notice or as otherwise provided
below. Such resignation by Agent as agent shall not affect its obligations
hereunder, if any, as a Lender.
13.19.2 Upon resignation by the Agent, or any successor Agent, the
Required Lenders shall appoint a successor Agent with the consent of
Borrower, which shall not be unreasonably withheld, conditioned or delayed
(provided that no consent of Borrower shall be required if the successor
Agent is also a Lender or if an Event of Default then exists). If no
successor Agent shall have been so appointed by the Required Lenders, and
shall have accepted such appointment within thirty (30) days after the
retiring Agent's giving notice of resignation, then the retiring Agent may
appoint a successor Agent with the consent of Borrower, which shall not be
unreasonably withheld, conditioned or delayed (provided that no consent of
Borrower shall be required if the successor Agent is also a Lender or if
an Event of Default then exists). Upon the acceptance of any appointment
as an Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the Agent and the Agent, and the retiring Agent
shall be discharged from its duties and obligations hereunder and under
the other Loan Documents other than its liability, if any, for duties and
obligations accrued prior to its retirement. After any retiring Agent's
resignation hereunder as an Agent, the provisions of this ARTICLE 13 shall
continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as an Agent hereunder and
under the other Loan Documents.
13.20 Distribution by Agent. If in the opinion of the Agent distribution
of any amount received by it in such capacity hereunder or under the Notes or
under any of the other Loan Documents might involve any liability, it may
refrain from making distribution until its right to make distribution shall have
been adjudicated by a court of competent jurisdiction or has been resolved by
the mutual consent of all Lenders. In addition, the Agent may request full and
complete indemnity, in form and substance satisfactory to it, prior to making
any such distribution. If a court of competent jurisdiction shall adjudge that
any amount received and distributed by the Agent is to be repaid, each person to
whom any such distribution shall have been made shall either repay to the Agent
its proportionate share of the amount so adjudged to be repaid or shall pay over
to the same in such manner and to such persons as shall be determined by such
court.
13.21 Holders
The Agent may deem and treat the payee of any Note as the owner thereof
for all purposes hereof unless and until a written notice of the assignment,
transfer or endorsement thereof, as the case may be, shall have been filed with
the Agent. Any request, authority or consent of any person or entity who, at the
time of making such request or giving such authority or consent, is the holder
of any Note shall be conclusive and binding on any subsequent holder, transferee
or endorsee, as the case may be, of such Note or of any Note or Notes issued in
exchange therefor.
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13.22 Assignment and Participation. Each Lender shall have the right to
assign, transfer, sell, negotiate, pledge or otherwise hypothecate this
Agreement and any of its rights and security hereunder and under the other Loan
Documents to any other Eligible Assignee with the prior written consent of the
Agent and with the prior written consent of Borrower, which consents by the
Agent and the Borrower shall not be unreasonably withheld, conditioned or
delayed (provided that, in the case of the Borrower, such consent shall not be
required if a Default or Event of Default shall have occurred and be continuing
and provided, further, such consent shall not be required from either the Agent
or the Borrower in connection with any assignment as to which (a) the assignee
is an existing Lender (other than a Defaulting Lender) or (b) an Affiliate or a
Related Fund of the assigning Lender)); provided, however, that (i) the parties
to each such assignment shall execute and deliver to Agent, for its approval and
acceptance, an Assignment and Assumption in form and substance satisfactory to
the Agent and substantially in the form set forth in Exhibit B attached hereto,
(ii) each such assignment shall be of a constant, and not a varying, percentage
of the assigning Lender's rights and obligations under this Agreement, (iii)
unless the Agent and, so long as no Event of Default exists, Borrower otherwise
consent, the aggregate amount of the Commitment of the assigning Lender being
assigned pursuant to each such assignment shall in no event be less than One
Million Dollars ($1,000,000.00), provided, however, that such minimum amount
shall not apply if either (x) the assignee is an Affiliate or Related Fund of
the Assigning Lender or (y) the Lender is assigning its entire remaining
interest in the Loan, (iv) the Agent shall receive from the assigning Lender a
processing fee of Three Thousand Five Hundred Dollars ($3,500.00), provided,
however, that such fee shall not apply if the assignee is an Affiliate or
Related Fund of the Assigning Lender, and (v) if the assignment is less than the
assigning Lender's entire interest in the Loan, the assigning Lender must retain
at least a One Million Dollar ($1,000,000.00) interest in the Loan, provided
that such minimum shall not apply if the assignee is an Affiliate or Related
Fund of the assigning Lender. The Agent may designate any Eligible Assignee
accepting an assignment of a specified portion of the Loans to be a Co-Agent, an
"Arranger" or similar title, but such designation shall not confer on such
Assignee the rights or duties of the Agent. Upon such execution, delivery,
approval and acceptance, and upon the effective date specified in the applicable
Assignment and Assumption, (a) the Eligible Assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Assumption, have the rights and
obligations of a Lender hereunder and under the other Loan Documents, and
Borrower hereby agrees that all of the rights and remedies of Lenders in
connection with the interest so assigned shall be enforceable against Borrower
by such Eligible Assignee with the same force and effect and to the same extent
as the same would have been enforceable but for such assignment, and (b) the
assigning Lender thereunder shall, to the extent that rights and obligations
hereunder and under the other Loan Documents have been assigned by it pursuant
to such Assignment and Assumption, relinquish its rights and be released from
its obligations hereunder and thereunder thereafter accruing. Notwithstanding
anything contained in this Section 13.22 to the contrary, prior to the
occurrence of an Event of Default, (x) KeyBank National Association shall at all
times hold not less than twenty-five percent (25%) of the Lenders' interest in
the Facility and (y) KeyBank National Association's interest in the Facility
shall at all times equal or exceed the interest of each other Lender.
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13.22.1 By executing and delivering an Assignment and Assumption,
the assigning Lender thereunder and the Eligible Assignee thereunder
confirm to and agree with each other and the other parties hereto as
follows: (i) except as provided in such Assignment and Assumption, such
assigning Lender makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or any other
Loan Document or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or any other Loan
Document or any other instrument or document furnished in connection
therewith; (ii) such assigning Lender 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 any Loan Document or any other instrument or
document furnished in connection therewith; (iii) such Eligible Assignee
confirms that it has received a copy of this Agreement together with such
financial statements, Loan Documents and other documents and information
as it has deemed appropriate to make its own credit analysis and decision
to enter into the Assignment and Assumption and to become a Lender
hereunder; (iv) such Eligible Assignee will, independently and without
reliance upon Agent, the assigning Lender or any other Lender, and based
on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (v) such Eligible Assignee appoints and
authorizes the Agent to take such action as the Agent on its behalf and to
exercise such powers under this Agreement and the other Loan Documents as
are delegated to Agent by the terms hereof and thereof, together with such
powers as are reasonably incidental thereto; and (vi) such Eligible
Assignee agrees that it will perform in accordance with their terms all of
the obligations which by the terms of this Agreement are required to be
performed by it as a Lender.
13.22.2 Agent shall maintain a copy of each Assignment and
Assumption delivered to and accepted by it and shall record in its records
the names and address of each Lender and the Commitment of, and Percentage
of the Loans owing to, such Lender from time to time. Borrower, the Agent
and Lenders may treat each entity whose name is so recorded as a Lender
hereunder for all purposes of this Agreement.
13.22.3 Upon receipt of an Assignment and Assumption executed by an
assigning Lender and an Eligible Assignee, Agent shall, if such Assignment
and Assumption has been properly completed and consented to if required
herein, accept such Assignment and Assumption, and record the information
contained therein in its records, and the Agent shall use its best efforts
to give prompt notice thereof to Borrower (provided that neither the Agent
nor the Lenders shall be liable for any failure to give such notice).
13.22.4 Borrower shall use reasonable efforts to cooperate with
Agent and each Lender in connection with the assignment of interests under
this Agreement or the sale of participations herein which shall be at no
cost to the Borrower.
13.22.5 Anything in this Agreement to the contrary notwithstanding,
and without the need to comply with any of the formal or procedural
requirements of this Agreement, including this Section, any Lender may at
any time and from time to time pledge and assign all or any portion of its
rights under all or any of the Loan Documents to a Federal Reserve Bank
or, in the case of a Lender which is a fund, to any holders of obligations
owed or securities issued by such Lender or any trustee for or other
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representatives of such holders; provided that no such pledge or
assignment shall release such Lender from its obligations hereunder. To
facilitate any such pledge or assignment, the Agent shall, at the request
of such Lender, enter into a letter agreement with the Federal Reserve
Bank in, or substantially in, the form of the exhibit to Appendix C to the
Federal Reserve Bank of New York Operating Circular No. 12.
13.22.6 Anything in this Agreement to the contrary notwithstanding,
and subject to the requirement that prior to the occurrence of an Event of
Default, (x) KeyBank National Association shall at all times hold not less
than twenty-five percent (25%) of the Lenders' interest in the Facility
and (y) KeyBank National Association's interest in the Facility shall at
all times equal or exceed the interest of each other Lender as provided in
Section 13.22 hereof, any Lender may assign all or any portion of its
rights and obligations under this Agreement to another branch or affiliate
of such Lender without first obtaining the approval of any Agent or the
Borrower, provided that (i) such Lender remains liable hereunder unless
the Borrower and Agent shall otherwise agree, (ii) at the time of such
assignment such Lender is not a Defaulting Lender, (iii) such Lender gives
the Agent and Borrower at least fifteen (15) days' prior written notice of
any such assignment; (iv) the parties to each such assignment execute and
deliver to Agent an Assignment and Assumption, and (v) the Agent receives
from the assigning Lender a processing fee of One Thousand Five Hundred
Dollars ($1,500).
13.22.7 Each Lender shall have the right, without the consent of the
Borrower, to sell participations to one or more Eligible Assignees, or an
Affiliate or Related Fund of the assigning Lender, in or to all or a
portion of its rights and obligations under the Facility and the Loan
Documents; provided, however, that (i) such Lender's obligations under
this Agreement (including without limitation its Commitment to Borrower
hereunder) shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations (iii) the Borrower, the Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and with regard
to any and all payments to be made under this Agreement and (iv) the
holder of any such participation shall not be entitled to voting rights
under this Agreement or the other Loan Documents (but such holder may
contract with the Lender selling such Eligible Assignee its interest in
such Lender's share of the Facility as to voting of such Lender's interest
under Section 13.26.2 but not under any other section of this Agreement,
provided that any such agreement by a Lender shall bind only such Lender
alone and not Borrower, the other Lenders or the Agent).
13.22.8 No Eligible Assignee of any rights and obligations under
this Agreement shall be permitted to subassign such rights and
obligations. No participant in any rights and obligations under this
Agreement shall be permitted to sell subparticipations of such rights and
obligations.
13.22.9 Borrower acknowledges and agrees that Lenders may provide to
any assignee or participant originals or copies of this Agreement, any
other Loan Document and any other documents, instruments, certificates,
opinions, insurance policies, letters of credit, reports, requisitions and
other materials and information of every nature or description, and may
communicate all oral information, at any time submitted by or on behalf of
Borrower or received by any Lender in connection with the Facility or with
respect to Borrower, provided that prior to any such delivery or
communication, such Eligible Assignees or participants shall agree to
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preserve the confidentiality of any of the foregoing to the same extent
that such Lender agreed to preserve such confidentiality. In order to
facilitate assignments to Eligible Assignees and sales to Eligible
Assignees, Borrower shall execute such further documents, instruments or
agreements as Lenders may reasonably require; provided, that Borrower
shall not be required (i) to execute any document or agreement which would
materially decrease its rights, or materially increase its obligations,
relative to those set forth in this Agreement or any of the other Loan
Documents (including financial obligations, personal recourse,
representations and warranties and reporting requirements), or (ii) to
expend more than incidental sums of money or incidental administrative
time for which it does not receive reasonable reimbursement in order to
comply with any requests or requirements of any Lender in connection with
such assignment or sale arrangement. In addition, Borrower agrees to
reasonably cooperate fully with Lenders in the exercise of Lenders' rights
pursuant to this Section, including providing such information and
documentation regarding Borrower as any Lender or any potential Eligible
Assignee may reasonably request and to meet with potential Eligible
Assignees in Borrower's offices.
13.23 Several Liability
Anything contained in this Agreement to the contrary notwithstanding, the
obligations of each Lender to Borrower under this Agreement are several and not
joint and several; each Lender shall only be obligated to fund its Percentage of
each disbursement to be made hereunder up to the amount of its Commitment.
Failure of any Lender to fulfill its obligations hereunder shall not result in
any other Lender becoming obligated to advance more than its Commitment, nor
shall such failure release or diminish the obligations of any other Lender to
fund its Commitment provided herein. During any time, and only during such time,
as Agent is the sole Lender and has not assigned any portion or portions of its
interest in the Loans to another Lender pursuant to an Assignment and Assumption
Agreement, Agent in its individual capacity shall be liable for all of the
obligations of the Lender under this Agreement and the other Loan Documents.
From and after the date that Agent as the sole Lender assigns any portion or
portions of its interest in the Loans to another Lender pursuant to an
Assignment and Assumption Agreement, then Agent shall act as the Agent on behalf
of itself as a Lender and the other Lenders.
13.24 Miscellaneous Assignment Provisions
Any assigning Lender shall retain its rights to be indemnified pursuant to
Section 7.19 with respect to any claims or actions arising prior to the date of
such assignment. If any assignee Lender is not incorporated under the laws of
the United States of America or any state thereof, it shall prior to the date on
which any interest or fees are payable hereunder or under any of the other Loan
Documents for its account, deliver to the Borrower and the Agent certification
as to its exemption from deduction or withholding of any United States federal
income taxes.
13.25 Assignment by Borrower.
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The Borrower shall not assign or transfer any of its rights or obligations
under any of the Loan Documents.
13.26 Consents and Approvals.
13.26.1 Each of the following shall require the approval or consent
of the Required Lenders:
(a) The exercise by Agent and/or Lenders of any rights and
remedies under the Loan Documents following an Event of Default,
provided that absent any direction from the Required Lenders, Agent
may exercise any right or remedy under the Loan Documents as Agent
may determine in good faith to be necessary or appropriate to
protect the Lenders or the collateral securing the Loan;
(b) Appointment of a successor Agent;
(c) Approval of Post-Default Plan (defined in Section 13.6.4);
and
(d) Except as referred to in Section 13.26.2 below, approval
of any amendment or modification of this Agreement or any of the
other Loan Documents, or issuance of any waiver of any material
provision of this Agreement or any of the other Loan Documents;
13.26.2 Each of the following shall require the approval or consent
of all the Lenders:
(a) Extension of the Maturity (beyond any extension permitted
herein) or forgiveness of all or any portion of the principal amount
of the Loan or any accrued interest thereon, or any other amendment
of this Agreement or the other Loan Documents which would reduce the
interest rate options or the rate at which fees are calculated or
forgive any loan fee, or extend the time of payment of any
principal, interest or fees;
(b) Reduction of the percentage specified in the definition of
Required Lenders;
(c) Increasing the amount of the Facility or any
non-consenting Lender's Commitment;
(d) Release of any lien on any material collateral (except as
Borrower is entitled to under the Loan Documents);
(e) The release or forgiveness of any Guarantor;
(f) Amendment of the provisions of this Section 13.26;
(g) Amendment of the Mandatory Prepayment Events;
(h) Modification of Section 13.5.2 on the distribution of
Liquidation Proceeds; and
70
(i) Amendment of what or how much is allowed as (i) Permitted
Liens on the Individual Properties or any other Collateral for the
Loan, (ii) Permitted Debt or (iii) Permitted Refinance.
13.26.3 In addition to the required consents or approvals referred
to in Sections 13.26.1 and 13.26.2 above, the Agent may at any time
request instructions from the Required Lenders with respect to any actions
or approvals which, by the terms of this Agreement or of any of the Loan
Documents, the Agent is permitted or required to take or to grant without
instructions from any Lenders, and if such instructions are promptly
requested, the Agent shall be absolutely entitled to refrain from taking
any action or to withhold any approval and shall not be under any
liability whatsoever for refraining from taking any action or withholding
any approval under any of the Loan Documents until it shall have received
such instructions from the Required Lenders. Without limiting the
foregoing, no Lender shall have any right of action whatsoever against any
Agent as a result of such Agent acting or refraining from acting under
this Agreement or any of the other Loan Documents in accordance with the
instructions of the Required Lenders or, where applicable, all Lenders.
The Agent shall promptly notify each Lender at any time that the Required
Lenders have instructed the Agent to act or refrain from acting pursuant
hereto.
13.26.4 Each Lender authorizes and directs the Agent to enter into
the Loan Documents other than this Agreement for the benefit of the
Lenders. Each Lender agrees that any action taken by the Agent at the
direction or with the consent of the Required Lenders in accordance with
the provisions of this Agreement or any other Loan Document, and the
exercise by the Agent at the direction or with the consent of the Required
Lenders of the powers set forth herein or therein, together with such
other powers as are reasonably incidental thereto, shall be authorized and
binding upon all Lenders, except for actions specifically requiring the
approval of all Lenders. All communications from the Agent to the Lenders
requesting Lenders' determination, consent, approval or disapproval (i)
shall be given in the form of a written notice to each Lender, (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 Lender 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 Lender and to the extent not
previously provided to such Lender, written materials and a summary of all
oral information provided to the Agent by Borrower in respect of the
matter or issue to be resolved, and (iv) shall include the Agent's
recommended course of action or determination in respect thereof. Each
Lender shall reply promptly, but in any event within ten (10) Business
Days after receipt of the request therefor from the Agent (the "Lender
Reply Period"). Unless a Lender shall give written notice to the Agent
that it objects to the recommendation or determination of the Agent
(together with a written explanation of the reasons behind such objection)
within the Lender Reply Period, such Lender shall be deemed to have
approved of or consented to such recommendation or determination. With
respect to decisions requiring the approval of the Required Lenders or all
Lenders, the Agent shall upon receiving the required approval or consent
follow the course of action or determination recommended to the Lenders by
the Agent or such other course of action recommended by the Required
Lenders. Where this Loan Agreement or any other Loan Document requires
that Borrower deliver any documentation to Agent or any Lenders, the
Borrower shall deliver the same to Agent and Agent shall promptly deliver
copies of the same to each of the Lenders.
71
13.27 Lead Arranger
Notwithstanding the provisions of this Agreement or of the other Loan
Documents, the Lead Arranger shall have no powers, rights, duties,
responsibilities or liabilities with respect to this Agreement and the other
Loan Documents. To the extent requested by the Agent, the Lead Arranger has
coordinated, or will coordinate, the initial syndication of the Facility and the
assignment of interests in the Facility.
ARTICLE 14
GENERAL PROVISIONS.
14.1 Notices
Any notice or other communication in connection with this Loan Agreement,
the Note, the Security Documents, or any of the other Loan Documents, shall be
in writing, and (i) deposited in the United States Mail, postage prepaid, by
registered or certified mail, or (ii) hand delivered by any commercially
recognized courier service or overnight delivery service such as Federal
Express, or (iii) sent by facsimile transmission if a FAX Number is designated
below addressed:
If to the Borrower:
WRT REALTY L.P.
Two ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Executive Vice President
FAX Number: (▇▇▇) ▇▇▇-▇▇▇▇
And
WRT REALTY L.P.
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Chief Operating Officer
FAX Number: (▇▇▇) ▇▇▇-▇▇▇▇
with copies by regular mail or such hand delivery or facsimile
transmission to:
Post ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
Two ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esquire
FAX Number: (▇▇▇) ▇▇▇-▇▇▇▇
72
If to Agent:
KEYBANK NATIONAL ASSOCIATION
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention:
FAX Number:
And
KEYBANK NATIONAL ASSOCIATION
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
FAX Number: ▇▇▇ ▇▇▇-▇▇▇▇
with copies by regular mail or such hand delivery or facsimile
transmission to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ LLP
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esquire
FAX Number: (▇▇▇) ▇▇▇-▇▇▇▇
If to LENDERS:
KEYBANK NATIONAL ASSOCIATION
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention:
FAX Number:
And
KEYBANK NATIONAL ASSOCIATION
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
FAX Number: ▇▇▇ ▇▇▇-▇▇▇▇
with copies by regular mail or such hand delivery or facsimile
transmission to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ LLP
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esquire
FAX Number: (▇▇▇) ▇▇▇-▇▇▇▇
If to any other Lender, to the addresses set forth on the signature page or to
such addresses as set forth in the Assignment and Acceptance.
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Any such addressee may change its address for such notices to such other
address in the United States as such addressee shall have specified by written
notice given as set forth above. All periods of notice shall be measured from
the deemed date of delivery.
A notice shall be deemed to have been given, delivered and received for
the purposes of all Loan Documents upon the earliest of: (i) if sent by such
certified or registered mail, on the third Business Day following the date of
postmark, or (ii) if hand delivered at the specified address by such courier or
overnight delivery service, when so delivered or tendered for delivery during
customary business hours on a Business Day, or (iii) if so mailed, on the date
of actual receipt as evidenced by the return receipt, or (iv) if so delivered,
upon actual receipt, or (v) if facsimile transmission is a permitted means of
giving notice, upon receipt as evidenced by confirmation.
14.2 Limitations on Assignment
The Borrower may not assign this Agreement or the monies due thereunder
without the prior written consent of all of the Lenders in each instance, but in
such event Lenders may nevertheless at their option make the Loans under this
Agreement to the Borrower or to those who succeed to the title of the Borrower
and all sums so advanced by Lenders shall be deemed a Loan under this Agreement
and not to be modifications thereof and shall be secured by all of the
Collateral for the subject's Borrower's Obligations given at any time in
connection herewith.
14.3 Further Assurances
The Borrower shall upon request from Agent from time to time execute,
seal, acknowledge and deliver such further instruments or documents which Agent
may reasonably require to better perfect and confirm its rights and remedies
hereunder, under the Notes, under the Security Documents and under each of the
other Loan Documents.
14.4 Payments
All payments under the Note shall be applied first to the payment of all
fees, expenses and other amounts due to the Agent (excluding principal and
interest) and, to the extent reimbursement is provided for herein, the Lenders,
then to accrued interest, and the balance on account of outstanding principal
under the Note; provided, however, that after an Event of Default, Liquidation
Proceeds will be applied to the Obligations of the Borrower to Agent and the
Lenders as otherwise provided for herein.
14.5 Parties Bound
The provisions of this Agreement and of each of the other Loan Documents
shall be binding upon and inure to the benefit of the Borrower, the Agent and
each of the Lenders and their respective successors and assigns, except as
otherwise prohibited by this Agreement or any of the other Loan Documents.
This Agreement is a contract by and among the Borrower, the Agent and each
of the Lenders for their mutual benefit, and no third person shall have any
right, claim or interest against either Agent, any of the Lenders or the
Borrower by virtue of any provision hereof.
14.6 Governing Law; Consent to Jurisdiction; Mutual Waiver of Jury Trial.
74
14.6.1 Substantial Relationship. It is understood and agreed that
all of the Loan Documents were negotiated, executed and delivered in The
Commonwealth of Massachusetts, which Commonwealth the parties agree has a
substantial relationship to the parties and to the underlying transactions
embodied by the Loan Documents.
14.6.2 Place of Delivery. The Borrower agrees to furnish to Agent at
the Agent's office in Boston, Massachusetts all further instruments,
certifications and documents to be furnished hereunder.
14.6.3 Governing Law. This Agreement and each of the other Loan
Documents shall in all respects be governed, construed, applied and
enforced in accordance with the internal laws of The Commonwealth of
Massachusetts without regard to principles of conflicts of law.
14.6.4 Consent to Jurisdiction. The Borrower hereby consents to
personal jurisdiction in any state or Federal court located within The
Commonwealth of Massachusetts.
14.6.5 JURY TRIAL WAIVER. THE BORROWER, AGENT, AND EACH OF THE
LENDERS MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE
RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON THIS LOAN
AGREEMENT, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS LOAN AGREEMENT
OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION
HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS
(WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING, WITHOUT
LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR
ACTIONS OF AGENT OR ANY LENDER RELATING TO THE ADMINISTRATION OF THE LOAN
OR ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE THAT NEITHER PARTY WILL
SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY
TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, EACH
PARTY HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY
LITIGATION ANY SPECIAL, INDIRECT, SPECULATIVE, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES. THE BORROWER CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY
OF AGENT OR ANY LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT AGENT
OR ANY LENDER WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR EACH
OF THE PARTIES HERETO TO ENTER INTO THE TRANSACTIONS CONTEMPLATED HEREBY.
14.7 Survival
All representations, warranties, covenants and agreements of the Borrower,
or a Loan Party, herein or in any other Loan Document, or in any notice,
certificate, or other paper delivered by or on behalf of the Borrower or a Loan
Party pursuant hereto are significant and shall be deemed to have been relied
upon by Agent and each of the Lenders notwithstanding any investigation made by
75
Agent or any of the Lenders or on its behalf and shall survive the delivery of
the Loan Documents and the making of the Loans pursuant thereto. No review or
approval by Agent or the Lenders or any of their representatives, of any opinion
letters, certificates by professionals or other item of any nature shall relieve
the Borrower or anyone else of any of the obligations, warranties or
representations made by or on behalf of Borrower or a Loan Party, or any one or
more of them, under any one or more of the Loan Documents.
14.8 Cumulative Rights
All of the rights of Agent and the Lenders hereunder and under each of the
other Loan Documents and any other agreement now or hereafter executed in
connection herewith or therewith, shall be cumulative and may be exercised
singly, together, or in such combination as Agent may determine in its sole good
faith judgment.
14.9 Claims Against Agent or Lenders.
14.9.1 Borrower Must Notify. The Agent and each of the Lenders shall
not be in default under this Agreement, or under any other Loan Document,
unless a written notice specifically setting forth the claim of the
Borrower shall have been given to Agent and each of the Lenders within
thirty (30) days after the subject Borrower first had actual Knowledge or
actual notice of the occurrence of the event which Borrower alleges gave
rise to such claim and Agent or any of the Lenders does not remedy or cure
the default, if any there be, with reasonable promptness thereafter. Such
actual Knowledge or actual notice shall refer to what was actually known
by, or expressed in a written notification furnished to, any of the
persons or officials referred to in Exhibit D as Authorized
Representatives.
14.9.2 Remedies. If it is determined by the final order of a court
of competent jurisdiction, which is not subject to further appeal, that
Agent or any of the Lenders has breached any of its obligations under the
Loan Documents and has not remedied or cured the same with reasonable
promptness following notice thereof, Agent's and each of the Lenders'
responsibilities shall be limited to: (i) where the breach consists of the
failure to grant consent or give approval in violation of the terms and
requirements of a Loan Document, the obligation to grant such consent or
give such approval and to pay the Borrower's reasonable costs and expenses
including, without limitation, reasonable attorneys' fees and
disbursements in connection with such court proceedings; and (ii) the case
of any such failure to grant such consent or give such approval, or in the
case of any other such default by Agent or any of the Lenders, where it is
also so determined that Agent or any of the Lenders acted in bad faith,
the payment of any actual, direct, compensatory damages sustained by the
Borrower as a result thereof plus the Borrower's reasonable costs and
expenses, including, without limitation, reasonable attorneys' fees and
disbursements in connection with such court proceedings.
14.9.3 Limitations. In no event, however, shall Agent and each of
the Lenders be liable to the Borrower or to any Loan Party or anyone else
for other damages such as, but not limited to, indirect, speculative,
special, exemplary, punitive or consequential damages whatever the nature
of the breach by Agent or any of the Lenders of its obligations under this
Loan Agreement or under any of the other Loan Documents. In no event shall
Agent or any of the Lenders be liable to the Borrower or to any Loan Party
or anyone else unless a written notice specifically setting forth the
claim of the Borrower shall have been given to Agent and each of the
Lenders within the time period specified above.
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14.10 Regarding Consents
Except to the extent expressly provided herein, any and all consents to be
made hereunder by the Agent, Required Lenders, or Lenders shall be in the
discretion of the Party to whom consent rights are given hereunder.
14.11 Obligations Absolute
Except to the extent prohibited by applicable law which cannot be waived,
the Obligations of the Borrower and the obligations of each Guarantor and the
other Loan Parties under the Loan Documents shall be joint and several,
absolute, unconditional and irrevocable and shall be paid strictly in accordance
with the terms of the Loan Documents to which such Loan Party is a party under
all circumstances whatsoever, including, without limitation, the existence of
any claim, set off, defense or other right which the Borrower or any Loan Party
may have at any time against Agent or any of the Lenders whether in connection
with the Loan or any unrelated transaction.
14.12 Table of Contents, Title and Headings
Any Table of Contents, the titles and the headings of sections are not
parts of this Loan Agreement or any other Loan Document and shall not be deemed
to affect the meaning or construction of any of its or their provisions.
14.13 Counterparts
This Loan Agreement and each other Loan Document may be executed in
several counterparts, each of which when executed and delivered is an original,
but all of which together shall constitute one instrument. In making proof of
this agreement, it shall not be necessary to produce or account for more than
one such counterpart which is executed by the party against whom enforcement of
such loan agreement is sought.
14.14 Satisfaction of Commitment
The Facility being established pursuant to the terms hereof and of the
other Loan Documents is being made in satisfaction of Agent's and each of the
Lenders' obligations under the terms letter dated November 16, 2005. The terms,
provisions and conditions of this Agreement and the other Loan Documents
supersede the provisions of the terms letter.
14.15 Time Of the Essence
Time is of the essence of each provision of this Agreement and each other
Loan Document.
14.16 No Oral Change
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This Loan Agreement and each of the other Loan Documents may only be
amended, terminated, extended or otherwise modified by a writing signed by the
party against which enforcement is sought (except no such writing shall be
required for any party which, pursuant to a specific provision of any Loan
Document, is required to be bound by changes without such party's assent). In no
event shall any oral agreements, promises, actions, inactions, knowledge, course
of conduct, course of dealings or the like be effective to amend, terminate,
extend or otherwise modify this Loan Agreement or any of the other Loan
Documents.
14.17 Monthly Statements
While Agent may issue invoices or other statements on a monthly or
periodic basis (a "Statement"), it is expressly acknowledged and agreed that:
(i) the failure of Agent to issue any Statement on one or more occasions shall
not affect the Borrower's obligations to make payments under the Loan Documents
as and when due; (ii) the inaccuracy of any Statement shall not be binding upon
Lenders and so Borrower shall always remain obligated to pay the full amount(s)
required under the Loan Documents as and when due notwithstanding any provision
to the contrary contained in any Statement; (iii) all Statements are issued for
information purposes only and shall never constitute any type of offer,
acceptance, modification, or waiver of the Loan Documents or any of Lenders'
rights or remedies thereunder; and (iv) in no event shall any Statement serve as
the basis for, or a component of, any course of dealing, course of conduct, or
trade practice which would modify, alter, or otherwise affect the express
written terms of the Loan Documents.
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IN WITNESS WHEREOF this Agreement has been duly executed and delivered as
a sealed instrument at Boston, Massachusetts, as of the date first written
above.
BORROWER:
WRT REALTY L.P., a Delaware limited
partnership
By: Winthrop Realty Trust,
general partner
By:
---------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chief Operating Officer
S-1
AGENT: KEYBANK NATIONAL ASSOCIATION,
a national banking association
By:
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Duly Authorized
LENDER: KEYBANK NATIONAL ASSOCIATION,
a national banking association
By:
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Duly Authorized
S-2
EXHIBITS:
Section
Reference
Number
Exhibit A - Definitions......................................................1.1
Exhibit B - Form of Assignment and Assumption..............................13.22
Exhibit C - Form of Note.....................................................3.2
Exhibit D - Authorized Representatives......................4.1, 14.9, Exhibit A
Exhibit E - Required Property, Hazard and Other
Insurance................................................6.19, 7.5.1
Exhibit F - Ownership Interests and Taxpayer
Identification Numbers........................................6.4(a)
Exhibit G-1 - Form of Compliance Certificate..............................7.2(c)
Exhibit G-2 - Form of Financial Covenant Compliance
Certificate.................................................7.2(c)
Exhibit H - Form of Notice of Rate Selection...............................2.4.3
Exhibit I - Lenders' Commitments.......................................Exhibit A
Exhibit K - Loan Agenda................................................Exhibit A
Exhibit M - Borrower Subsidiaries......................................Exhibit A
Exhibit N - Pledged Securities.............................................3.1.2
EXHIBIT A TO LOAN AGREEMENT
DEFINITIONS
Accounts shall mean, collectively, the Depository Accounts.
Additional Collateral as defined in Section 3.3.
Adjusted Earnings shall mean the REIT's net income (loss) (computed in
accordance with GAAP) excluding gains (or losses) from debt restructurings and
sales of real property, plus real estate related depreciation and amortization
and after adjustments for unconsolidated partnerships and joint ventures, as set
forth in more detail under the definitions and interpretations thereof relative
to funds from operations promulgated by the National Association of Real Estate
Investment Trusts or its successor, adjusted for (i) the pro rata share of
straight line rents, (ii) less the pro rata share of all regularly scheduled
principal amortization payments (other than any final "balloon" payments due at
maturity) and (iii) less the pro rata share of allowances for tenant
improvements and leasing costs.
Adjusted LIBOR Rate: For any LIBOR Rate Interest Period, an interest rate per
annum equal to the sum of (A) the rate obtained by dividing (x) the LIBOR Rate
for such LIBOR Rate Interest Period by (y) a percentage equal to one hundred
percent (100%) minus the Reserve Percentage for such LIBOR Rate Interest Period
and (B) the Applicable Margin.
Adjusted LIBOR Rate Advance. The term "Adjusted LIBOR Rate Advance" means any
principal outstanding under this Agreement which pursuant to this Agreement
bears interest at the Adjusted LIBOR Rate.
Adjusted Prime Rate: A rate per annum equal to the sum of (a) the Applicable
Margin for Prime Rate Advances and (b) the greater of (i) the Prime Rate or (ii)
one percent (1%) in excess of the Federal Funds Effective Rate. Any change in
the Adjusted Prime Rate shall be effective immediately from and after a change
in the Adjusted Prime Rate (or the Federal Funds Effective Rate, as applicable).
Adjusted Prime Rate Advance. The term "Adjusted Prime Rate Advance" means any
principal amount outstanding under this Agreement which pursuant to this
Agreement bears interest at the Adjusted Prime Rate.
Affiliate shall mean, as to any Person, any other Person that, directly or
indirectly, is in control of, is controlled by or is under common control with
such Person or is a director or officer of such Person. For purposes of this
definition, control of a Person shall mean the power, direct or indirect, (i) to
vote 10% or more of the securities having ordinary voting power for the election
of directors of such Person or (ii) to direct or cause the direction of the
management and policies of such Person, whether by contract or otherwise.
Agent. KEYBANK NATIONAL ASSOCIATION, acting as agent for the Lenders.
Agreement as defined in the Preamble.
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Applicable Margin shall mean the amount specified below for each Adjusted Prime
Rate Advance or LIBOR Rate Advance, as applicable, based on the applicable
Consolidated Leverage Ratio:
--------------------------------------------------------------------------------
Applicable Margin Applicable Margin
Consolidated Leverage Ratio* LIBOR Rate Option Adjusted Prime Rate Option
--------------------------------------------------------------------------------
<35% 1.50% 0.00%
--------------------------------------------------------------------------------
35% > 45% 1.75% 0.25%
--------------------------------------------------------------------------------
>45% > 55% 2.00% 0.50%
--------------------------------------------------------------------------------
>55% > 60% 2.25% 0.75%
--------------------------------------------------------------------------------
* the Consolidated Leverage Ratio is calculated net of the Repo Agreement
However, as long as the Borrower maintains $25,000,000.00 in cash, on deposit
with the Agent Bank in a Deposit Account which is pledge to the Agent as
collateral for the Obligations, and the Consolidated Leverage Ratio is 45% or
below, the Applicable Margin will be as follows:
--------------------------------------------------------------------------------
Applicable Margin Applicable Margin
TL/TA* LIBOR Rate Option Adjusted Prime Rate Option
--------------------------------------------------------------------------------
<45% 1.35% 0.00%
--------------------------------------------------------------------------------
An increase or decrease in the Applicable Margin shall be effective on the first
day following the Agent's receipt of a quarterly Compliance Certificate which
reflects a change in the Consolidated Leverage Ratio.
Applicable Rate: As such term is defined in Section 2.4.1.
Appraisal as defined in Section 7.18.
Arranger shall mean KEYBANC CAPITAL MARKETS.
Assigned Collateral shall mean and include the various collateral securing the
Clearwater Loan Facility and the participation interest in the loan held by
"Westside."
Authorized Representatives as defined in Section 4.1 and listed on Exhibit D.
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Availability as defined in Section 2.1.1.
Borrower as defined in the Preamble.
Borrower Subsidiaries shall mean all of the Subsidiaries of the Borrower, and
all Subsidiaries of Subsidiaries of the Borrower, including, without limitation,
the entities as listed on Exhibit M.
Borrowing shall mean the borrowing of a portion of Facility from all the Lenders
on a given date (or the conversion of a Loan or Loans of a Lender or Lenders on
a given date).
Borrowing Base shall mean, as determined by the Agent, the aggregate of (a)
provided such Investment is accounted for on a net equity basis in accordance
with GAAP, 50% of the value (net of capital events) of the mezzanine loans made
by FT-Marc Loan LLC to the various Marc Borrowers, (b) the lesser of (i) 35% of
the Offering Price or (ii) 50% of the market value of the ▇▇▇▇▇▇▇ Pledged
Securities, (c) 50% of the market value of all other Pledged Securities, (c) 70%
of the outstanding balances of the Assigned Collateral, and (d) 70% of the
Borrower's unencumbered equity in wholly owned real estate or other real estate
investments (including, but not limited to joint ventures and loans) which, in
each instance, are pledged or otherwise subject to a lien in favor of the Agent
in a manner acceptable to the Agent.
Breakage Costs: (a) The cost to Lender of re-employing funds bearing interest at
an Adjusted LIBOR Rate, incurred (or expected to be incurred) in connection with
(i) any payment of any portion of the Loans bearing interest at an Adjusted
LIBOR Rate prior to the termination of any applicable LIBOR Rate Interest
Period, (ii) the conversion of an Adjusted LIBOR Rate to any other applicable
interest rate on a date other than the last day of the relevant LIBOR Rate
Interest Period, or (iii) the failure of Borrower to draw down, on the first day
of the applicable LIBOR Rate Interest Period, any amount as to which Borrower
has elected a LIBOR Rate Option and (b) any amounts payable by Borrower under
any Interest Rate Agreement in connection with termination of such Agreement.
Business Day shall mean any day of the year on which offices of Agent are not
required or authorized by law to be closed for business in Boston,
Massachusetts. If any day on which a payment is due is not a Business Day, then
the payment shall be due on the next day following which is a Business Day, and
such extension of time shall be included in computing interest and fees in
connection with such payment. Further, if there is no corresponding day for a
payment in the given calendar month (i.e., there is no "February 30th"), the
payment shall be due on the last Business Day of the calendar month.
Calculation Date as defined in Section 7.26.1(a)(i).
Calculation Period as defined in Section 7.26.1(a)(ii).
Cash Flow shall mean, in each calendar year, in each instance determined in a
manner satisfactory to the Agent, the aggregate sum of (i) all revenues and cash
receipts of the Borrower Subsidiaries less (ii) the sum of the Borrower
Subsidiaries' (a) property level operating expenses including but not limited to
ground rent, (b) management fees and (c) administrative fees.
A-3
Cash Management Agreement one or more cash management agreements to be entered
into pursuant to ARTICLE 7.
Change of Control shall mean the occurrence of any of the following, as
determined solely by the Agent (for purposes of this definition, ownership of
interests in a Borrower that are subject to a Lien permitted under the Security
Documents shall be deemed beneficially owned by the pledgor thereof):
1. Any Person (including affiliates of such Person, but excluding
FUR Advisors LLC or any Affiliate thereof) or "group" (as such term is
defined in applicable federal securities laws and regulations) shall
acquire more than twenty-five percent (25%) of the common shares of the
REIT (provided, however, it shall not be a Change in Control if a Change
in Control would otherwise occur solely as a result of the conversion of
any of the existing preferred shares of beneficial interest in the REIT)
or ;
2. The Advisory Agreement with FUR Advisors LLC shall have been
terminated unless either (i) the REIT and the Borrower shall become
internally managed, or (ii) a replacement advisory agreement shall have
been entered into so long as in either case the REIT and the Borrower will
be managed by either (x) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ or (y) such
other management personnel or company that has substantial experience and
a reputation, in each case, equal to or better than that of the current
management of the REIT and the Borrower, which determination shall be made
in the sole discretion of the Agent.
Clearwater Loan Facility as defined in Section 3.1.5(a).
Closing Date as defined in Section ARTICLE 5.
Code shall mean the Internal Revenue Code of 1986, as amended from time to time,
and the regulations promulgated and rulings issued thereunder. Section
references to the Code are to the Code, as in effect at the date of this
Agreement and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
Collateral. as defined in Section 3.1., together with any additional Collateral
granted to the Agent as set forth in Section 3.3.
Commitment shall mean, with respect to each Lender, the amount set forth on
Exhibit I hereto as the amount of such Lender's commitment to make advances to
the Borrower, as may be amended from time to time by the Agent as provided in
Article 13 or in connection with any increase in the Total Commitment.
Consents as defined in Section 5.4.
Consolidated Debt Service as defined in Section 7.26.1(a)(iii).
Consolidated Debt Service Coverage as defined in Section 7.26.1(a)(iv)
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Consolidated Entity or Consolidated Entities shall mean, singly and
collectively, the Borrower, the REIT, and any wholly owned Subsidiary of the
Borrower or the REIT.
Consolidated Leverage Ratio as defined in Section. 7.26.2.
Debt shall mean, with respect to any Person, without duplication, (i) all
indebtedness of such Person for borrowed money, (ii) all indebtedness of such
Person for the deferred purchase price of property or services (other than
property and services purchased, and expense accruals and deferred compensation
items arising, in the ordinary course of business), (iii) all obligations of
such Person evidenced by notes, bonds, debentures or other similar instruments
(other than performance, surety and appeal bonds arising in the ordinary course
of business), (iv) all indebtedness of such Person created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property), (v) all obligations of such Person under leases which
have been, or should be, in accordance with generally accepted Accounting
principles, recorded as capital leases, to the extent required to be so
recorded, (vi) all reimbursement, payment or similar obligations of such Person,
contingent or otherwise, under acceptance, letter of credit or similar
facilities (other than letters of credit in support of trade obligations or in
connection with workers' compensation, unemployment insurance, old-age pensions
and other social security benefits in the ordinary course of business), (vii)
all Debt in the nature of that referred to in clauses (i) through (vi) above
which is guaranteed directly or indirectly by such Person, or in effect
guaranteed directly or indirectly by such Person through an agreement (A) to pay
or purchase such Debt or to advance or supply funds for the payment or purchase
of such Debt, (B) to purchase, sell or lease (as lessee or lessor) property, or
to purchase or sell services, primarily for the purpose of enabling the debtor
to make payment of such Debt or to assure the holder of such Debt against loss
in respect of such Debt, (C) to supply funds to or in any other manner invest in
the debtor (including any agreement to pay for property or services irrespective
of whether such property is received or such services are rendered) or (D)
otherwise to assure a creditor against loss in respect of such Debt, (viii) any
obligation, contingent or otherwise, of such Person guaranteeing or having the
economic effect of guaranteeing any indebtedness referred to in clause (i)
through (iv) above of any Person, either directly or indirectly, and (ix) all
Debt referred to in clauses (i) through (vi) above secured by (or for which the
holder of such Debt has an existing right, contingent or otherwise, to be
secured by) any Lien, security interest or other charge or encumbrance upon or
in property (including, without limitation, accounts and contract rights) owned
by such Person, even though such Person has not assumed or become liable for the
payment of such Debt.
Debt Service as defined in Section 7.26.1(a)(v).
Debt Service Coverage as defined in Section 7.26.1(a)(vi).
Default as defined in Section 10.1.
Defaulting Lender: As such term is defined in Section 13.5.4.
Default Rate as defined in Section 2.5.5.
A-5
Depository Account Pledge and Security Agreement as defined in Section 3.1.3.
Depository Accounts as defined in Section 3.1.3.
Distribution shall mean, with respect to any Person, that such Person has paid a
dividend or returned any equity capital to its stockholders, members or partners
or made any other distribution, payment or delivery of property (other than
common stock or partnership or membership interests of such Person) or cash to
its stockholders, members or partners as such, or redeemed, retired, purchased
or otherwise acquired, directly or indirectly, for a consideration any shares of
any class of its capital stock or any membership or partnership interests (or
any options or warrants issued by such Person with respect to its capital stock
or membership or partnership interests), or shall have permitted any of its
Subsidiaries to purchase or otherwise acquire for a consideration any shares of
any class of the capital stock or any membership or partnership interests of
such Person (or any options or warrants issued by such Person with respect to
its capital stock or membership or partnership interests). Without limiting the
foregoing, "Distributions" with respect to any Person shall also include all
payments made by such Person with respect to any stock appreciation rights,
plans, equity incentive or achievement plans or any similar plans, and any
proceeds of a dissolution or liquidation of such Person.
Dollars shall mean lawful money of the United States.
Eligible Assignee: (i) Any Lender; (ii) any commercial bank, savings bank,
savings and loan association or similar financial institution which (A) has
total assets of One Billion Dollars ($1,000,000,000) or more, (B) is "well
capitalized" within the meaning of such term under the regulations promulgated
under the auspices of the Federal Deposit Insurance Corporation Improvement Act
of 1991, (C) in the sole judgment of the Agent, is engaged in the business of
lending money and extending credit, and buying loans or participations in loans
under credit facilities substantially similar to those extended under this
Agreement, and (D) in the reasonable judgment of the Agent, is operationally and
procedurally able to meet the obligations of a Lender hereunder to the same
degree as a commercial bank; (iii) any insurance company in the business of
writing insurance which (A) has total assets of One Billion Dollars
($1,000,000,000) or more (B) is "best capitalized" within the meaning of such
term under the applicable regulations of the National Association of Insurance
Commissioners, and (C) meets the requirements set forth in subclauses (C) and
(D) of clause (ii) above; and (iv) any other financial institution having total
assets of One Billion Dollars ($1,000,000,000) (including a mutual fund or other
fund under management of any investment manager having under its management
total assets of One Billion Dollars ($1,000,000,000) or more) which meets the
requirement set forth in subclauses (C) and (D) of clause (ii) above; provided
that each Eligible Assignee must (w) be organized under the Laws of the United
States of America, any state thereof or the District of Columbia, or, if a
commercial bank, be organized under the Laws of the United States of America,
any state thereof or the District of Columbia, the Cayman Islands or any country
which is a member of the Organization for Economic Cooperation and Development,
or a political subdivision of such a country, (x) act under the Loan Documents
through a branch, agency or funding office located in the United States of
America, (y) be exempt from withholding of tax on interest and deliver the
documents related thereto pursuant to the Internal Revenue Code as in effect
from time to time and (z) not be the Borrower or an Affiliate of the Borrower.
A-6
Environmental Indemnity as defined in Section 3.1.6.
Environmental Laws as defined in the Environmental Indemnity.
ERISA shall mean the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the date
of this Agreement and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.
ERISA Affiliate shall mean each person (as defined in Section 3(9) of ERISA)
which together with the Borrower or a Subsidiary of a Borrower would be deemed
to be a "single employer" within the meaning of Section 414(b), (c), (m) or (o)
of the Code. Event of Default as defined in Section 10.1.
Extended Maturity Date as defined in Section 2.2.
Extended Term as defined in Section 2.2.
Extension Fee as defined in Section 2.6.
Facility as defined in Section 1.3.
Facility Amount shall mean $50,000,000.00, subject to increase as set forth in
Section 2.1.2.
Federal Funds Effective Rate: Shall mean, for any day, the rate per annum
(rounded upward to the nearest on one-hundredth of one percent (1/100 of 1%))
announced by the Federal Reserve Bank of Cleveland on such day as being the
weighted average of the rates on overnight federal funds transactions arranged
by federal funds brokers on the previous trading day, as computed and announced
by such Federal Reserve Bank in substantially the same manner as such Federal
Reserve Bank computes and announces the weighted average it refers to as the
"Federal Funds Effective Rate."
Financial Covenants shall mean those covenants of the Borrower set forth in
Section 7.26.
Fiscal Year shall mean each twelve month period commencing on January 1 and
ending on December 31.
Fixed Charges as defined in Section 7.26.1(a)(vii).
Fixed Charge Coverage as defined in Section 7.26.1(a)(viii).
Formation Documents shall mean, singly and collectively, the partnership
agreements, joint venture agreements, limited partnership agreements, limited
liability company or operating agreements and certificates of limited
partnership and certificates of formation, articles (or certificate) of
incorporation and by-laws and any similar agreement, document or instrument of
any Person.
Funding Date shall mean the date the advance of the initial proceeds of the
Loan.
▇-▇
▇▇▇▇ shall mean generally accepted Accounting principles in the United States of
America as of the date applicable.
Governmental Authority shall mean any court, board, agency, commission, office
or authority of any nature whatsoever for any governmental ▇▇▇▇ (▇▇▇▇▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ or otherwise) whether now or hereafter in
existence.
Guaranty as defined in Section 3.1.4.
Guarantor as defined in Section 1.4.
Hazardous Materials shall mean and include asbestos, flammable materials,
explosives, radioactive substances, polychlorinated biphenyls, radioactive
substances, other carcinogens, oil and other petroleum products, pollutants or
contaminants that could be a detriment to the environment, and any other
hazardous or toxic materials, wastes, or substances which are defined,
determined or identified as such in any past, present or future federal, state
or local laws, rules, codes or regulations, or any judicial or administrative
interpretation of such laws, rules, codes or regulations.
Indemnified Party as defined in Sections 7.19.
Indemnitor as defined in Section 3.1.6.
Independent shall mean, when used with respect to any Person, a Person who (i)
is in fact independent, (ii) does not have any direct financial or indirect
financial interest (other than amounts payable to such Person for serving as a
director) in the Borrower, any Borrower Subsidiary, or any Loan Party or in any
Affiliate of any thereof or in any constituent partner or member of the
Borrower, any Borrower Subsidiary, or any Loan Party or any Affiliate of any
thereof and (iii) is not connected with the Borrower, any Borrower Subsidiary,
or any Loan Party or any Affiliate thereof or any constituent partner of the
Borrower, any Borrower Subsidiary, or any Loan Party or any Affiliate of any
thereof as an officer, employee, promoter, underwriter, trustee, partner,
director, or person performing similar functions. Any such Person shall not be
deemed to fail to comply with the requirements of clause (iii), above, solely
due to such Person serving as an Independent director of the REIT. Whenever it
is herein provided that any Independent Person's opinion or certificate shall be
provided, such opinion or certificate shall state that the Person executing the
same has read this definition and is Independent within the meaning hereof.
Individual Property and Individual Properties shall mean, from time to time,
each real estate property which is owned by, ground leased to or subject to a
life estate in favor of a Borrower Subsidiary, together with all improvements,
fixtures, equipment, and personalty relating to such property.
Initial Term as defined in Section 2.2.
Initial Maturity Date as defined in Section 2.2.
A-8
Interest Rate Agreement: An Interest Rate Protection Product purchased by
Borrower from Agent.
Interest Rate Protection Product: An interest rate hedging product, such as a
cap or swap.
Investment shall mean the acquisition of any real or tangible personal property
or of any stock or other security, any loan, advance, bank deposit, money market
fund, contribution to capital, extension of credit (except for accounts
receivable arising in the ordinary course of business and payable in accordance
with customary terms), or purchase or commitment or option to purchase or
otherwise acquire real estate or tangible personal property or stock or other
securities of any party or any part of the business or assets comprising such
business, or any part thereof.
Knowledge shall mean with respect to the Borrower and any of their respective
Subsidiaries, the knowledge of any of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇, or ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, or any Person who shall at any time replace any of
the foregoing.
Late Charge as defined in Section 2.5.6.
Lease shall mean any lease relative to all or any portion of an Individual
Property.
Legal Requirements shall mean all applicable federal, state, county and local
laws, by-laws, rules, regulations, codes and ordinances, and the requirements of
any governmental agency or authority having or claiming jurisdiction with
respect thereto, including, but not limited to, all Environmental Laws, and
those applicable to zoning, subdivision, building, health, fire, safety,
sanitation, the protection of the handicapped, and environmental matters and
shall also include all orders and directives of any court, governmental agency
or authority having or claiming jurisdiction with respect thereto.
Lenders as defined in the Preamble.
Lender Default Obligation: As such term is defined in Section 13.5.4.
Lender Reply Period: As such term is defined in Section 13.26.
LIBOR Business Day: A Business Day on which dealings in U.S. dollars are carried
on in the London Interbank Market.
LIBOR Rate: For any LIBOR Rate Interest Period, the average rate (rounded
upwards to the nearest 1/16th) as shown in Dow ▇▇▇▇▇ Markets (formerly Telerate)
(Page 3750) at which deposits in U.S. dollars are offered by first class banks
in the London Interbank Market at approximately 11:00 a.m. (London time) on the
day that is two (2) LIBOR Business Days prior to the first day of such LIBOR
Rate Interest Period with a maturity approximately equal to such LIBOR Rate
Interest Period and in an amount approximately equal to the amount to which such
LIBOR Rate Interest Period relates, adjusted for reserves and taxes if required
by future regulations. If Dow ▇▇▇▇▇ Markets no longer reports such rate or Agent
determines in good faith that the rate so reported no longer accurately reflects
the rate available to Agent in the London Interbank Market, Lender may select a
replacement index.
A-9
LIBOR Rate Interest Period: With respect to each amount bearing interest at a
LIBOR based rate, a period of one (1), two (2), three (3), or six (6) months, to
the extent deposits with such maturities are available to Agent, commencing on a
LIBOR Business Day, as selected by Borrower provided, however, that (i) any
LIBOR Rate Interest Period which would otherwise end on a day which is not a
LIBOR Business Day shall continue to and end on the next succeeding LIBOR
Business Day, unless the result would be that such LIBOR Rate Interest Period
would be extended to the next succeeding calendar month, in which case such
LIBOR Rate Interest Period shall end on the next preceding LIBOR Business Day ,
(ii) any LIBOR Rate Interest Period which begins on a day for which there is no
numerically corresponding date in the calendar month in which such LIBOR Rate
Interest Period would otherwise end shall instead end on the last LIBOR Business
Day of such calendar month, and (iii) Borrower may not select a LIBOR Rate
Interest Period which would end after the Maturity Date..
LIBOR Rate Option: As defined in Section 2.4.
Lien shall mean any mortgage, deed of trust, lien, pledge, hypothecation,
assignment, security interest, or any other encumbrance, charge or transfer,
including, without limitation, any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and mechanic's, materialmen's and other similar liens and
encumbrances.
Licenses and Permits shall mean all licenses, permits, authorizations and
agreements issued by or agreed to by any governmental authority, including, but
not limited to, building permits, occupancy permits and such special permits,
variances and other relief as may be required pursuant to Legal Requirements
which may be applicable to the Individual Property.
Liquid Assets shall mean the sum of the following unencumbered (other than by
Liens held by the Agent on behalf of the Lenders) assets: (i) all cash
(denominated in United States dollars), (ii) any demand deposits, (iii)
marketable securities consisting of short-term (maturity of one year or less)
obligations issued or guaranteed as to principal and interest by the United
States of America, (iv) short-term certificates of deposit, with a maturity of
one year or less, issued by any bank organized under the laws of the United
States of America having total assets in excess of $1,000,000,000.00, and (v)
any other securities acceptable to the Agent as evidenced by the Agent's written
approval.
Liquidation Proceeds. Amounts received by the Agent and/or the Lenders in the
exercise of the rights and remedies under the Loan Documents (including, but not
limited to, all rents, profits and other proceeds received by the Agent and/or
the Lenders from the liquidation of, or exercising rights upon the occurrence of
an Event of Default relative to, any Collateral, but not including any amount
bid at a foreclosure sale or on behalf of the Agent or otherwise credited to a
Borrower in, any deed-in-lieu of foreclosure or similar transaction).
Loan and Loans as defined in Section 1.3.
Loan Agenda shall mean that Document Agenda respecting the establishment of the
Facility annexed hereto as Exhibit K.
Loan Agreement as defined in the Preamble.
A-10
Loan Documents as defined in Section 3.1.
Loan Party and Loan Parties shall mean, singly and collectively, the Borrower
and each Borrower Subsidiary or other person executing a Loan Document in favor
of the Agent, including pursuant to Section 3.3.
Management Agreements as defined in Section 6.9.
Mandatory Principal Prepayments as defined in Section 2.5.1(a).
MARC Borrowers shall mean ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Executive Plaza LLC, MARC Salt Creek
LLC, MARC River Road LLC, MARC National Plaza III LLC, MARC National Plaza II
LLC, MARC National Plaza I LLC, MARC Michigan 30 LLC, ▇▇▇▇ ▇▇▇▇▇▇▇ LLC, ▇▇▇▇
Highpoint Plaza LLC, MARC Euclid Center LLC, ▇▇▇▇ ▇▇▇▇▇▇ Building LLC, MARC 8 S.
Michigan LLC, MARC 600 ▇▇▇▇▇▇▇ LLC, ▇▇▇▇ 427 ▇. ▇▇▇▇▇▇▇ LLC, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ LLC, MARC 29 ▇. ▇▇▇▇▇▇▇ LLC, ▇▇▇▇ 28 ▇. ▇▇▇▇▇▇▇ LLC, ▇▇▇▇ ▇▇▇ ▇. ▇▇▇▇▇▇▇
LLC, ▇▇▇▇ ▇▇▇▇ ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ LLC, MARC ▇▇▇ ▇. ▇▇▇▇▇▇▇ LLC, ▇▇▇▇ ▇▇▇ ▇.
▇▇▇▇▇▇▇ LLC, ▇▇▇▇ 11 ▇. ▇▇▇▇▇ LLC, ▇▇▇▇ 999 East Touhy LLC, MARC ▇▇ ▇. ▇▇▇▇▇▇▇,
▇▇▇▇▇ Star Trust Company.
Market Rent shall mean, at any point of determination, then current rentals
being charged to new tenants for comparable quality space located on comparable
quality property within the subject geographic area of the subject Individual
Property, taking into account and giving effect to, without limitation, such
considerations as size, location of the Individual Property, lease term and
level and quality of building construction and space improvements, tenant
allowances, and rent concessions, all as reasonably determined by the Agent.
Material Adverse Effect shall mean a material adverse effect on, determined
separately with respect to the Borrower, (i) the business, assets, prospects,
operations or financial or other condition of any of the Borrower and/or, taken
as a whole, any of the other Loan Parties, including, without limitation, all
Distributions (ii) the ability of Borrower, the Borrower Subsidiaries, and/or
the other Loan Parties to perform any material Obligations or to pay any
Obligations which it is obligated to pay in accordance with the terms hereof or
of any other Loan Document, (iii) the rights of, or benefits available to, the
Agent and/or any of the Lenders under any Loan Document or (iv) any Lien given
to Agent and/or any of the Lenders on any material portion of the Collateral or
the priority of any such Lien.
Maturity shall mean the Initial Maturity Date, or, if the Maturity Date has been
extended pursuant to the provisions of the Loan Agreement, the applicable
Extended Maturity Date, or in any instance, upon acceleration of the Facility,
if the Facility has been accelerated by Lenders upon an Event of Default.
Maturity Date shall mean the Initial Maturity Date, or, if the Maturity Date has
been extended pursuant to the provisions of the Loan Agreement, the applicable
Extended Maturity Date.
Minimum Consolidated Net Worth as defined in Section 7.26.3.
▇▇▇▇▇▇▇ Pledged Securities shall mean the Pledged Securities which are shares in
NRT.
A-11
Net Cash Flow as defined in Section 7.26.1(a)(ix).
Net Worth shall mean the sum of the consolidated net worth of the REIT as
evidenced by the REIT's annual and quarterly SEC reports.
Note shall mean, singly and collectively, the Note or Notes payable to Agent on
behalf of the Lenders in the original principal amount of Fifty Million Dollars
($50,000,000.00).
Notice of Intention to Distribute as defined in Section 9.2.1.
NRT shall mean ▇▇▇▇▇▇▇ Realty Trust, Inc., a Maryland corporation.
Obligations shall mean all indebtedness, obligations and liabilities of the
Borrower to the Agent and/or any Lender existing on the date of this Agreement
or arising thereafter, direct or indirect, joint or several, absolute or
contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, assignment, operation of law or otherwise,
arising or incurred under this Agreement, the Note, or any of the other Loan
Documents, including, without limitation, under any Interest Rate Protection
Agreement with the Agent with respect to the Loan.
OFAC: Office of Foreign Asset Control of the Department of the Treasury of the
United States of America.
OFAC Review Process: That certain review process established by Agent to
determine if any potential transferee of any interests or any assignee of any
portion of the Loans or any of their members, officers or partners area a party
with whom Agent and any Lender are restricted from doing business under (i) the
regulations of OFAC, including those Persons named on OFAC's Specially
Designated and Blocked Persons list, or (ii) any other statute, executive order
or other governmental action or list (including the September 24, 2001 Executive
Order Blocking Property and Prohibiting Transactions With Persons Who Commit,
Threaten to Commit, or Support Terrorism).
Offering Price shall mean $16.00 per share.
Officer's Certificate shall mean a certificate delivered to the Agent by a
Borrower, a Subsidiary of a Borrower, or a Guarantor, as the case may be,
respectively, which is signed by an authorized officer thereof (or an authorized
officer of the direct or indirect managing general partner or managing member,
as applicable, of such Borrower, the Borrower Subsidiary, or such Guarantor, if
and as applicable).
One-Month LIBOR Rate as defined in Section 2.4
Payment Direction Letters as defined in Section 7.15.
PBGC shall mean the Pension Benefit Guaranty Corporation established pursuant to
Section 4002 of ERISA, or any successor thereto.
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Percentage shall mean, with respect to each Lender, the amount set forth on
Exhibit I hereto as the such Lender's commitment percentage of the Total
Commitment to make advances to the Borrower, as may be amended from time to time
by the Agent as provided in Article 13 or in connection with any increase in the
Total Commitment..
Permitted Debt as defined in Section 8.4.
Permitted Distributions as defined in Section 8.16.
Permitted Investments as defined in Section 8.17.
Permitted Liens as defined in Section 8.2.
Permitted Refinance as defined in Section 8.4.2(b).
Person shall mean any individual, corporation, partnership, joint venture,
estate, trust, unincorporated association or limited liability company, any
federal, state, county or municipal government or any bureau, department or
agency thereof and any fiduciary acting in such capacity on behalf of any of the
foregoing.
Plan shall mean any multiemployer or single-employer plan as defined in Section
4001 of ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute of) a Borrower or any Subsidiary of a Borrower or an
ERISA Affiliate, and each such plan for the five year period immediately
following the latest date on which such Person or an ERISA Affiliate maintained,
contributed to or had an obligation to contribute to such plan.
Prime Rate That interest rate established from time to time by KeyBank National
Association as its prime rate, whether or not such rate is publicly announced;
the Prime Rate may not be the lowest interest rate charged by KeyBank National
Association for commercial or other extensions of credit.
Pro Rata shall mean a calculation based on the percentage of the capital stock
of or other equity interest in any Person owned, directly or indirectly, by the
Borrower and/or the REIT. For the purposes of this definition, the Pro Rata
share of a Consolidated Entity shall be deemed to be 100%.
Property Owners shall mean, singly and collectively, each Borrower Subsidiary or
other Person which owns the fee interest, land estate, or ground lease interest
in any Individual Property.
Registration Rights Agreement shall mean that certain Registration Rights
Agreement dated as of November 7, 2005 entered into between NRT and the REIT.
REIT as defined in Section 1.2.
Related Documents shall mean, singly and collectively, the Formation Documents,
the Payment Direction Letters, and the documents establishing and evidencing any
Subsidiary Debt.
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Related Fund shall mean, with respect to a Lender which is a fund that invests
in loans, any other such fund managed by the same investment advisor as such
Lender or by an Affiliate of such Lender or such advisor.
Repo Agreement shall mean that Master Repurchase Agreement with Bear ▇▇▇▇▇▇▇ &
Co., Inc., dated June 24, 2005 or any replacement thereof.
Reportable Event shall mean an event described in Section 4043(b) of ERISA with
respect to a Plan other than those events as to which the 30-day notice period
is waived under subsection .13, .14, .16, .18, .19 or .20 of PBGC Regulation
Section 2615, or as otherwise now or hereafter defined in ERISA.
Required Lenders: Lenders holding Percentages aggregating at least sixty six and
two-thirds percent (66 2/3%).
Reserve Percentage: For any LIBOR Rate Interest Period, that percentage which is
specified three (3) Business Days before the first day of such LIBOR Rate
Interest Period by the Board of Governors of the Federal Reserve System (or any
successor) or any other governmental or quasi-governmental authority with
jurisdiction over Lender for determining the maximum reserve requirement
(including, but not limited to, any marginal reserve requirement) for Lender
with respect to liabilities constituting of or including (among other
liabilities) Eurocurrency liabilities in an amount equal to that portion of the
Loans affected by such LIBOR Rate Interest Period and with a maturity equal to
such LIBOR Rate Interest Period.
Security Documents as defined in Section 3.2.
Single-Purpose Entity shall mean, with respect to a Person, that such Person has
Formation Documents which contain generally the following provisions (with such
variations as required by the provisions of the Subsidiary Debt) , and has
agreed to abide by such terms and conditions:
(a) Such Person shall not engage in any business or activity other than
acquiring by merger the assets and liabilities of the applicable Property Owner.
(b) Such Person shall not acquire or own any material assets other than
(i) the real property owned by the Subsidiary on the Closing Date, and (ii) such
incidental personal property as may be necessary for the operation of such real
property.
(c) Such Person shall not fail to preserve its existence as an entity duly
organized, validly existing and in good standing (if applicable) under the laws
of the jurisdiction of its organization or formation and under the applicable
laws of any state or states in which the ownership of its assets or the conduct
of its business requires such qualification.
(d) Such Person shall not incur any Debt, except as provided herein.
(e) Such Person shall not merge into or consolidate with any person or
entity or dissolve, terminate or liquidate in whole or in part, transfer or
otherwise dispose of all or substantially all of its assets or change its legal
structure.
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(f) Such Person shall not own any subsidiary or make any investment in any
person or entity.
(g) Such Person shall not file or consent to the filing of any petition,
either voluntary or involuntary, to take advantage of any applicable insolvency,
bankruptcy, liquidation or reorganization statute, or make an assignment for the
benefit of creditors.
(h) Such Person shall agree to abide by the following covenants in its
management and operation:
(i) To maintain its records, books of account and bank accounts
separate and apart from those of any other Person;
(ii) Not to commingle assets with those of any other Person;
(iii) Not to maintain its assets in such a manner that it will be
costly or difficult to segregate, ascertain or identify its individual
assets from those of any other Person;
(iv) To maintain separate financial statements;
(v) To pay its own liabilities out of its own funds;
(vi) To observe all corporate, partnership or limited liability
company formalities;
(vii) To maintain an arm's-length relationship with its Affiliates;
(viii) To pay the salaries of its own employees and maintain a
sufficient number of employees in light of its contemplated business
operations;
(ix) Not to guarantee or become obligated for the debts of any other
entity or hold out its credit as being available to satisfy the
obligations of others, except as provided for herein;
(x) Not to acquire obligations or securities of its partners,
members or shareholders;
(xi) To allocate and charge fairly and reasonably any overhead for
shared office space or any common employee or overhead shared with
affiliates;
(xii) To use separate stationery, invoices and checks;
(xiii) Not to pledge its assets for the benefit of any other entity
or make any loan or advances to any entity, including any general partner
or any affiliate thereof, except as provided for herein;
(xiv) To hold itself out to the public as a legal entity separate
and distinct from any other Person and to conduct its business solely in
its own name in order not (A) to mislead others as to the identity with
which such other Person is transacting business, or (B) to suggest that
such Person is responsible for the debts of any third party (including any
general partner or any affiliate thereof or any other Person);
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(xv) To correct any known misunderstanding regarding its separate
identity; and
(xvi) To maintain adequate capital and cash on hand for the normal
obligations reasonably foreseeable in a business of its size and character
and in light of its contemplated business operations.
State shall mean the State or Commonwealth in which the subject of such
reference or any part thereof is located.
Statement as defined in Section 14.17.
Subsidiary shall mean, with respect to any Person, any corporation, association,
limited liability company, partnership or other business entity of which
securities or other ownership interests representing more than 50% of either (x)
the beneficial ownership interest or (y) ordinary voting power are, at the time
as of which any determination is being made, owned or controlled, directly or
indirectly, by such Person.
Subsidiary Debt shall mean all Debt now or hereafter incurred by any Subsidiary
of the Borrower, or by an entity in which the Borrower or any Subsidiary has a
debt or equity interest.
Subsidiary Debt Schedule as defined in Section 6.17.7.
Subsidiary Guarantor as defined in Section 1.4.
Title Reports as defined in Section 5.10(a).
Total Asset Value shall mean, as of the date of determination, the total assets
of the REIT and its Subsidiaries, on a consolidated basis, each as determined in
accordance with GAAP, but, as to the assets subject to the Repo Agreement,
including only the value of such assets in excess of the debt outstanding under
the Repo Agreement.
Total Commitment. The sum of the Commitments of the Lenders, as in effect from
time to time.
UCC or the Uniform Commercial Code means the Uniform Commercial Code in effect
in a State.
Unfunded Current Liability of any Plan means the amount, if any, by which the
actuarial present value of the accumulated plan benefits under the Plan as of
the close of its most recent plan year exceeds the fair market value of the
assets allocable thereto, each determined in accordance with Statement of
Financial Accounting Standards No. 35, based upon the actuarial assumptions used
by the Plan's actuary in the most recent annual valuation of the Plan.
United States and U.S. shall each mean the United States of America.
Unused Commitment Fee as defined in Section 2.6.2.
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