EXHIBIT 10.4
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EXECUTION COPY
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$75,000,000 SENIOR UNSECURED CREDIT AGREEMENT
AMONG
ARDEN REALTY LIMITED PARTNERSHIP,
A MARYLAND LIMITED PARTNERSHIP,
AS BORROWER,
AND
THE SEVERAL LENDERS FROM
TIME TO TIME PARTIES HERETO,
LEHMAN BROTHERS INC., AS
SOLE LEAD ARRANGER
AND BOOK RUNNING
MANAGER
AND
LEHMAN COMMERCIAL PAPER INC.
AS SYNDICATION AGENT AND ADMINISTRATIVE AGENT
Dated as of July 27, 2000
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TABLE OF CONTENTS
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ARTICLE 1 - DEFINITIONS...........................................................................................1
1.1 Certain Defined Terms.............................................................1
1.2 Computation of Time Periods......................................................19
1.3 Terms............................................................................19
ARTICLE 2 - ADVANCES.............................................................................................19
2.1 Loan Advances and Repayment......................................................19
2.2 Authorization to Obtain Advances.................................................21
2.3 Lenders' Accounting..............................................................21
2.4 Interest on the Advances.........................................................21
2.5 Fees.............................................................................24
2.6 Payments.........................................................................25
2.7 Notice of Increased Costs........................................................26
2.8 Voluntary Termination or Reduction of Commitment.................................25
ARTICLE 3 - CONDITIONS TO ADVANCES...............................................................................26
3.1 Conditions to Initial Advances...................................................26
3.2 Conditions Precedent to All Advances.............................................27
ARTICLE 4 - REPRESENTATIONS AND WARRANTIES.......................................................................28
4.1 Representations and Warranties as to Borrower, Etc...............................28
4.2 Representations and Warranties as to the REIT....................................31
ARTICLE 5 - REPORTING COVENANTS..................................................................................33
5.1 Financial Statements and Other Financial and Operating
Information..................................................................33
5.2 Environmental Notices............................................................37
5.3 Confidentiality..................................................................37
5.4 Annual Evidence of Insurance.....................................................37
ARTICLE 6 - AFFIRMATIVE COVENANTS................................................................................37
6.1 With Respect to Borrower.........................................................37
6.2 With Respect to the REIT.........................................................39
ARTICLE 7 - NEGATIVE COVENANTS...................................................................................40
7.1 With Respect to all Parties......................................................40
7.2 Amendment of Constituent Documents...............................................41
7.3 REIT Directors...................................................................41
7.4 Management.......................................................................41
7.5 Margin Regulations...............................................................41
7.6 Organization of Borrower, Etc....................................................42
7.7 With Respect to the REIT.........................................................42
ARTICLE 8 - FINANCIAL COVENANTS..................................................................................42
8.1 Tangible Net Worth...............................................................42
8.2 Maximum Total Liabilities to Gross Asset Value...................................42
8.3 Minimum Interest Coverage Ratio..................................................42
8.4 Minimum Fixed Charge Coverage Ratio..............................................42
8.5 Minimum Unencumbered Pool........................................................42
8.6 Minimum Unsecured Interest Expense Coverage......................................42
8.7 Distributions....................................................................43
8.8 Investments; Asset Mix...........................................................43
8.9 Secured Debt.....................................................................43
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ARTICLE 9 - EVENTS OF DEFAULT; RIGHTS AND REMEDIES...............................................................44
9.1 Events of Default................................................................44
9.2 Rights and Remedies..............................................................45
9.3 Rescission.......................................................................46
ARTICLE 10 - AGENCY PROVISIONS...................................................................................47
10.1 Appointment.....................................................................47
10.2 Nature of Duties................................................................47
10.3 Disbursements of Advances.......................................................47
10.4 Distribution and Apportionment of Payments......................................48
10.5 Rights, Exculpation, Etc........................................................49
10.6 Reliance........................................................................49
10.7 Indemnification.................................................................49
10.8 Administrative Agent Individually...............................................49
10.9 Successor Administrative Agent; Resignation of
Administrative Agent; Removal of Administrative Agent........................49
10.10 Consent and Approvals..........................................................50
10.11 Certain Agency Provisions Relating to Enforcement..............................51
10.12 Ratable Sharing................................................................51
10.13 Delivery of Documents..........................................................52
10.14 Notice of Events of Default....................................................52
10.15 Syndication Agent..............................................................52
ARTICLE 11 - MISCELLANEOUS.......................................................................................52
11.1 Expenses........................................................................52
11.2 Indemnity.......................................................................53
11.3 Change in Accounting Principles and "Funds from
Operations" Definition.......................................................53
11.4 Amendments and Waivers..........................................................53
11.5 Independence of Covenants.......................................................54
11.6 Notices and Delivery............................................................55
11.7 Survival of Warranties, Indemnities and Agreements..............................55
11.8 Failure or Indulgence Not Waiver; Remedies Cumulative...........................55
11.9 Payments Set Aside..............................................................55
11.10 Severability...................................................................55
11.11 Headings.......................................................................55
11.12 Governing Law; Waiver..........................................................55
11.13 Limitation of Liability........................................................55
11.14 Successors and Assigns.........................................................56
11.15 Consent to Jurisdiction and Service of Process;
Waiver of Jury Trial.........................................................56
11.16 Counterparts; Effectiveness; Inconsistencies...................................56
11.17 Performance of Obligations.....................................................56
11.18 Construction...................................................................56
11.19 Entire Agreement...............................................................56
11.20 Assignments and Participations.................................................57
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LIST OF EXHIBITS AND SCHEDULES
Exhibits:
A - Form of Assignment and Assumption Agreement
B - [Reserved].
C - Form of Compliance Certificate
D - Form of Fixed Rate Notice
E - Form of Guaranty
F - Form of Note
G - Form of Notice of Borrowing
H-1 - Form of REIT Solvency Certificate
H-2 - Form of Borrower Solvency Certificate
Schedules:
1.1 - Pro Rata Shares of Lenders
2.2 - Employees Authorized to Sign Notices of Borrowing
4.1(c) - Ownership of Borrower
4.1(j) - List of Litigation
4.1(s) - Environmental Matters
4.1(v) - Management Agreements
4.2(l) - Benefit Plans
8.5 - List of Unencumbered Assets
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CREDIT AGREEMENT
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THIS CREDIT AGREEMENT, dated as of July 27, 2000 (as amended,
supplemented or modified from time to time, this "Agreement"), is made and
entered into by and among ARDEN REALTY LIMITED PARTNERSHIP, a Maryland limited
partnership ("Borrower"),the several banks and other financial institutions or
entities from time to time parties to this Agreement (the "Lenders"), LEHMAN
BROTHERS INC., as Sole Lead Arranger and Book Running Manager, and LEHMAN
COMMERCIAL PAPER INC. ("LCPI"), as Syndication Agent and Administrative Agent.
The parties hereto hereby agree as follows:
ARTICLE 1
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DEFINITIONS
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1.1 Certain Defined Terms. The following terms used in this
Agreement shall have the following meanings (such meanings to be applicable,
except to the extent otherwise indicated in a definition of a particular term,
both to the singular and the plural forms of the terms defined):
"Accountants" means any (i) "big five" accounting firm or (ii)
another firm of certified public accountants of recognized national standing
selected by Borrower and acceptable to Administrative Agent.
"Acquisition Price" means the aggregate purchase price for an
asset, including bona fide purchase money financing provided by the seller and
all other Indebtedness encumbering such asset at the time of acquisition.
"Administrative Agent" means Lehman Commercial Paper Inc., in
its capacity as administrative agent for the Lenders under this Agreement, and
any successor administrative agent appointed pursuant hereto.
"Advance" means any advance made or to be made to Borrower
pursuant to Article 2, and includes each Base Rate Advance and each LIBOR
Advance.
"Affiliates" as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common control with,
that Person. For purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means (a) the possession, directly or
indirectly, of the power to vote ten percent (10%) or more of the Securities
having voting power for the election of directors of such Person or otherwise to
direct or cause the direction of the management and policies of that Person,
whether through the ownership of voting Securities or by contract or otherwise,
or (b) the ownership of ten percent (10%) or more of the outstanding general
partnership or other ownership interests of such Person.
"Applicable LIBOR Rate Margin" means, for each Pricing Period,
the interest rate margin set forth below (expressed in basis points per annum)
opposite the Applicable Pricing Level for that Pricing Period:
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Applicable Pricing Level Margin
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I 105.00
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II 115.00
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III 130.00
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IV 170.00
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; provided that, if the Maturity Date is extended pursuant to Section 2.1(e),
the Applicable LIBOR Rate Margin during the extension period shall be adjusted
to a market rate as determined by the Administrative Agent in its sole
discretion and accepted by the Borrower in accordance with Section 2.1(e).
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"Applicable Pricing Level" means (a) for the First Pricing
Period, Pricing Level III and (b) for each Pricing Period thereafter, the
pricing level set forth below, as applicable, either (i) if Borrower did not
deliver a Rating Notice to Administrative Agent as required by Section 6.1(k),
below, Level IV, or (ii) if Administrative Agent did receive a Rating Notice,
the Pricing Level opposite Borrower's Long-Term Unsecured Senior Debt Rating as
of the date of Administrative Agent's receipt of such Rating Notice as
determined by Administrative Agent:
Borrower's Long-Term
Pricing Level Unsecured Senior Debt Rating
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I Equal to or higher than BBB+/Baa1
II BBB/Baa2
III BBB-/Baa3
IV Lower than BBB-/Baa3
or No Rating
"Assignment and Assumption" means an Assignment and Assumption
Agreement in the form of Exhibit A hereto (with blanks appropriately filled in)
delivered to Administrative Agent in connection with each assignment of a
Lender's interest under this Agreement pursuant to Section 11.20.
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"Base Rate" means, on any day, the higher of (a) the rate of
interest per annum established from time to time by Deutsche Bank, New York
Office at its principal office in New York City, New York, and designated as its
prime rate as in effect on such day and (b) the Federal Funds Rate in effect on
such day plus one-half of one percent (0.5%) per annum.
"Base Rate Advance" means an Advance bearing interest at the
Base Rate.
"Benefit Plan" means any employee pension benefit plan as
defined in Section 3(2) of ERISA (other than a Multiemployer Plan) in respect of
which a Person or an ERISA Affiliate is, or within the immediately preceding
five (5) years was, an "employer" as defined in Section 3(5) of ERISA.
"Borrower" means Arden Realty Limited Partnership, a Maryland
limited partnership.
"Borrower's Long-Term Unsecured Senior Debt Rating" means the
lower of such rating as set by Standard & Poor's and Moody's Investors Service,
Inc.
"Business Day" means (a) with respect to any Advance, payment
or rate determination of LIBOR Advances, a day, other than a Saturday or Sunday,
on which Administrative Agent is open for business in New York City, New York
and on which dealings in Dollars are carried on in the London interbank market,
and (b) for all other purposes any day excluding Saturday, Sunday and any day
which is a legal holiday under the laws of the State of New York, or is a day on
which banking institutions located in New York are required or authorized by law
or other governmental action to close.
"Capital Lease" means, as applied to any Person, any lease of
any property (whether real, personal or mixed) by that Person as lessee which,
in conformity with GAAP, is or should be accounted for as a capital lease on the
balance sheet of that Person.
"Capital Lease Obligations" means all monetary obligations of
a Person under any Capital Lease.
"Capitalized Loan Fees" means, with respect to the REIT and
any Consolidated Entity, and with respect to any period, (a) any up-front,
closing or similar fees paid by such Person in connection with the incurring or
refinancing of Indebtedness during such period and (b) all other costs incurred
in connection with the incurring or refinancing of Indebtedness during such
period, including, without limitation, appraisal fees paid to lenders, costs and
expenses incurred in connection with Swap Agreements, phase 1 environmental
report review fees paid to lenders and legal fees, in each of the foregoing
cases, that are capitalized on the balance sheet of such Person and amortized
over the term of such Indebtedness.
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"Capital Stock" means, with respect to any Person, all (i)
shares, interests, participations or other equivalents (howsoever designated) of
capital stock or partnership or other equity interests of such Person and (ii)
rights (other than debt securities convertible into capital stock or other
equity interests), warrants or options to acquire any such capital stock or
partnership or other equity interests of such Person. The term "Capital Stock"
includes the Partnership Units of Borrower.
"Cash" means, when used in connection with any Person, all
monetary and nonmonetary items owned by that Person that are treated as cash in
accordance with GAAP, consistently applied. "Cash" shall not include tenant
deposits.
"Cash Equivalents" means (a) marketable direct obligations
issued or unconditionally guaranteed by the United States Government or issued
by an agency thereof and backed by the full faith and credit of the United
States, in each case maturing within one (1) year after the date of acquisition
thereof; (b) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any public
instrumentality thereof maturing within ninety (90) days after the date of
acquisition thereof and, at the time of acquisition, having one of the two
highest ratings obtainable from any two of Standard & Poor's, Moody's Investors
Service, Inc., Duff and Phelps, or Fitch Investors Service, Inc. (or, if at any
time no two of the foregoing shall be rating such obligations, then from such
other nationally recognized rating services as may be acceptable to
Administrative Agent) and not listed for possible down-grade in Credit Watch
published by Standard & Poor's; (c) commercial paper, other than commercial
paper issued by Borrower or any of its Affiliates, maturing no more than ninety
(90) days after the date of creation thereof and, at the time of acquisition,
having a rating of at least A-1 or P-1 from either Standard & Poor's, or Moody's
Investors Service, Inc. or, if at any time neither Standard & Poor's, nor
Moody's Investors Service, Inc. shall be rating such obligations, then the
highest rating from such other nationally recognized rating services as may be
acceptable to Administrative Agent); and (d) domestic and Eurodollar
certificates of deposit or time deposits or bankers' acceptances maturing within
ninety (90) days after the date of acquisition thereof, overnight securities
repurchase agreements, or reverse repurchase agreements secured by any of the
foregoing types of securities or debt instruments issued, in each case, by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia or Canada which at the time of
acquisition (A) has (or, in the case of a bank which is a subsidiary, such
bank's parent has) a rating of its senior unsecured debt obligations of not less
than Baa-2 by Moody's Investors Service, Inc. or a comparable rating by a rating
agency acceptable to Administrative Agent and (B) has total assets in excess of
Ten Billion Dollars ($10,000,000,000).
"City National Bank Loan" means revolving loans made by City
National Bank to Borrower in an aggregate committed principal amount which shall
not exceed $10,000,000 pursuant to the terms of that certain Loan Agreement
dated March 12, 1997 between Borrower and City National Bank, as amended through
the date of this Agreement.
"Closing Date" means the date on which the applicable
conditions contained in Sections 3.1 and 3.2 are satisfied or waived. Within
five (5) Business Days of the occurrence thereof, Administrative Agent shall
deliver written notice to Borrower and the Lenders confirming the date on which
the Closing Date occurred.
"CMBS Entities" means, collectively, Arden Realty Finance,
Inc., a California corporation, which is a wholly-owned subsidiary corporation
of the REIT, Arden Realty Finance Partnership, L.P., a California limited
partnership, with respect to which limited partnership Arden Realty Finance,
Inc., is the sole general partner and Borrower is a limited partner, Arden
Realty Finance II, Inc., a Maryland corporation, which is a wholly-owned
subsidiary corporation of the REIT, Arden Realty Finance III LLC, a Delaware
limited liability company, which is wholly owned by Borrower, Arden Realty
Finance IV LLC, a Delaware limited liability company, which is wholly owned by
Borrower, Activity Business Center Limited Partnership, a Delaware limited
partnership, with respect to which limited partnership Arden Realty Finance II,
Inc. is the sole general partner and Borrower is the sole limited partner, 145
South Fairfax, LLC, a California limited liability company, which is wholly
owned by Borrower, Arden Realty Finance V LLC, a Delaware limited liability
company, which is wholly owned by Borrower, Westwood Center Limited Partnership,
a California limited partnership, with respect to which limited partnership
Borrower is the sole general partner, and Arden Realty Finance VI LLC, a
Delaware limited liability company, which is wholly owned by Borrower.
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"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Commission" means the Securities and Exchange Commission.
"Commitment" means, subject to Sections 2.7 and 2.8,
$75,000,000. As of the Closing Date, the respective Pro Rata Shares of the
Lenders with respect to the Commitment are set forth in Schedule 1.1.
"Compliance Certificate" means a certificate in the form of
Exhibit C hereto delivered to Administrative Agent by Borrower pursuant to
Section 5.1(d) or other provision of this Agreement and covering compliance with
the covenants contained in Section 7.3 and Article 8.
"Consolidated Entity" means, collectively, (i) Borrower and
(ii) any other Person the accounts of which are consolidated with those of the
REIT in the consolidated financial statements of the REIT in accordance with
GAAP.
"Construction in Progress" means land on which Borrower has
commenced, and is diligently proceeding with, the construction of an Office
Property. If, after Borrower has commenced the construction of an Office
Property, such construction ceases for 45 or more consecutive days, such land
shall cease to be Construction in Progress and shall become Land until Borrower
starts construction of the Office Property again.
"Contaminant" means any pollutant (as that term is defined in
42 U.S.C. 9601(33)) or toxic pollutant (as that term is defined in 33 U.S.C.
1362(13)), hazardous substance (as that term is defined in 42 U.S.C. 9601(14)),
hazardous chemical (as that term is defined by 29 CFR Section 1910.1200(c)),
toxic substance, hazardous waste (as that term is defined in 42 U.S.C. 6903(5)),
radioactive material, special waste, petroleum (including crude oil or any
petroleum-derived substance, waste, or breakdown or decomposition product
thereof), any constituent of any such substance or waste, including, but not
limited to, polychlorinated biphenyls and asbestos, or any other substance or
waste deleterious to the environment the release, disposal or remediation of
which is now or at any time becomes subject to regulation under any
Environmental Law.
"Contractual Obligation" as applied to any Person, means any
provision of any Securities issued by that Person or any indenture, mortgage,
deed of trust, lease, contract, undertaking, document or instrument to which
that Person is a party or by which it or any of its properties is bound, or to
which it or any of its properties is subject (including, without limitation, any
restrictive covenant affecting such Person or any of its properties).
"Contribution Agreement" means (i) that certain Contribution
Agreement made as of October 9, 1996, by and among Richard S. Ziman, an
individual, Montour Realty Associates, a California general partnership,
Metropolitan Falls Partners, a California general partnership, Intercity
Building Associates, a California general partnership, Victor J. Coleman, an
individual, Coleman Enterprises, Inc., a California corporation, Ziman Realty
Partners, a California general partnership, Broad Base Investments II, LLC, a
Nevada limited liability company, Michele Byer, individually and as trustee of
the Michele Byer Trust, a revocable inter vivos trust dated September 20, 1996,
Anaheim Properties LLC, a California limited liability company, Arden Century
Associates, a California general partnership, Arden Sawtelle Associates, a
California general partnership, the REIT and Borrower and (ii) any other
agreement between Borrower and a CMBS Entity providing for contribution by
Borrower of certain contributions it receives from its limited partners with
respect to Debt of the CMBS Entity and on substantially similar terms as the
Contribution Agreement described in the foregoing clause (i). Borrower shall
deliver to Administrative Agent a copy of each Contribution Agreement entered
into after the date of this Agreement.
"Court Order" means any judgment, writ, injunction, decree,
rule or regulation of any court or Governmental Authority binding upon the
Person in question.
"Debt" means, with respect to any Person, without duplication,
the principal amount of (a) its liabilities for borrowed money, (b) its
liabilities for the deferred purchase price of property acquired by such Person
(excluding accounts payable in the ordinary course of business, but including,
without limitation, all liabilities created or arising under any conditional
sale or other title retention agreement with respect to any property), (c) its
Capitalized Lease Obligations, (d) any liabilities for borrowed money secured by
a Lien with respect to any property owned by such Person (whether or not it is
assumed by such Person or such Person otherwise becomes liable for such
liabilities), (e) all liabilities with respect to any unreimbursed draws on
letters of credit and (f) any guaranty of such Person with respect to any of the
foregoing.
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"Debt Service" means, for any period, Interest Expense for
such period plus scheduled principal amortization (excluding any balloon or
bullet payment due at maturity) for such period on all Debt of the REIT and the
Consolidated Entities and on the REIT's and each Consolidated Entity's pro rata
share of all Debt of each Unconsolidated Joint Venture. For purposes of the
foregoing definition, the REIT's and such Consolidated Entity's pro rata share
of such Debt shall be deemed to be equal to the product of (i) such Debt,
multiplied by (ii) the percentage of the total outstanding Capital Stock of such
Unconsolidated Joint Venture held by the REIT or such Consolidated Entity,
expressed as a decimal. For purposes of the preceding sentence, the term
"Capital Stock" shall not include the interests described in clause (ii) of the
definition of "Capital Stock".
"Defaulting Lender" means any Lender which fails or refuses to
perform its obligations under this Agreement within the time period specified
for performance of such obligation or, if no time frame is specified, if such
failure or refusal continues for a period of five (5) Business Days after notice
from Administrative Agent.
"Depreciation and Amortization Expense" means (without
duplication), for any period, the sum for such period of (i) total depreciation
and amortization expense, whether paid or accrued, of the REIT and the
Consolidated Entities, plus (ii) the REIT's and each Consolidated Entity's pro
rata share of depreciation and amortization expenses of Unconsolidated Joint
Ventures. For purposes of this definition, the REIT's and such Consolidated
Entity's pro rata share of depreciation and amortization expense of any
Unconsolidated Joint Venture shall be deemed equal to the product of (i) the
depreciation and amortization expense of such Unconsolidated Joint Venture,
multiplied by (ii) the percentage of the total outstanding Capital Stock of such
Unconsolidated Joint Venture held by the REIT or such Consolidated Entity,
expressed as a decimal. For purposes of the preceding sentence, the term
"Capital Stock" shall not include the interests described in clause (ii) of the
definition of "Capital Stock".
"Designated Market" means, with respect to any LIBOR Advance,
the London interbank LIBOR market or such other interbank LIBOR market as may be
designated in writing from time to time by the Requisite Lenders.
"Disqualified Stock" means any capital stock, warrants,
options or other rights to acquire capital stock (but excluding any debt
security which is convertible, or exchangeable, for capital stock), which, by
its terms (or by the terms of any security into which it is convertible or for
which it is exchangeable), or upon the happening of any event, matures or is
mandatorily redeemable prior to the Maturity Date, pursuant to a sinking fund
obligation or otherwise, or is or may be redeemable at the option of the holder
thereof, in whole or in part, prior to the Maturity Date. Borrower's Partnership
Units shall not be considered Disqualified Stock.
"DOL" means the United States Department of Labor and any
successor department or agency.
"Dollars" and "$" means the lawful money of the United States
of America.
"EBITDA" means, for any period, Net Income, plus (without
duplication) (a) Interest Expense, (b) Tax Expense, (c) Depreciation and
Amortization Expense and (d) cash dividends and distributions actually received
by the REIT or any Consolidated Entity from any Unconsolidated Joint Venture, in
each case for such period.
"Environmental Laws" has the meaning set forth in Section
4.1(s).
"Environmental Lien" means a Lien in favor of any Governmental
Authority for (a) any liability under Environmental Laws, or (b) damages arising
from, or costs incurred by such Governmental Authority in response to, a Release
or threatened Release of a Contaminant into the environment.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute.
"ERISA Affiliate" means, with respect to any Person, any (a)
corporation which is, becomes, or is deemed to be a member of the same
controlled group of corporations (within the meaning of Section 414(b) of the
Code) as such Person, (b) partnership, trade or business (whether or not
incorporated) which is, becomes or is deemed to be under common control (within
the meaning of Section 414(c) of the Code) with such Person, (c) solely for
purposes of potential liability under Section 302(c)(11) of ERISA and Section
412(c)(11) of the Code and the lien created under Section 302(f) of ERISA and
Section 412(n) of the Code, Person which is, becomes or is deemed to be a member
of the same "affiliated service group" (as defined in Section 414(m) of the
Code) as such Person, or (d) solely for purposes of potential liability under
Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code and the lien
created under Section 302(f) of ERISA and Section 412(n) of the Code, other
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organization or arrangement described in Section 414(o) of the Code which is,
becomes or is deemed to be required to be aggregated pursuant to regulations
issued under Section 414(o) of the Code with such Person pursuant to Section
414(o) of the Code.
"Event of Default" means any of the occurrences so defined in
Article 9.
"Extension Option Exercise Date" means the date on which the
extension of the Maturity Date becomes effective pursuant to Section 2.1(e).
"FDIC" means the Federal Deposit Insurance Corporation or any
successor thereto.
"Federal Funds Rate" means, as of any date of determination,
the rate set forth in the weekly statistical release designated as H.15(519), or
any successor publication, published by the Federal Reserve Board of New York
(including any such successor, "H.15(519)") for such date opposite the caption
"Federal Funds (Effective)". If on any relevant date the appropriate rate for
such date is not yet published in H.15(519), the rate for such date will be the
arithmetic mean of the rates for the last transaction in overnight Federal funds
arranged prior to 9:00 a.m. (New York City time) on that date by each of three
leading brokers of Federal Funds transactions in New York City selected by
Administrative Agent. For purposes of this Agreement, any change in the Base
Rate due to a change in the Federal Funds Rate shall be effective as of the
opening of business on the effective date of such change.
"Federal Reserve Board" means the Board of Governors of the
Federal Reserve System or any governmental authority succeeding to its
functions.
"FIRREA" means the Financial Institutions Recovery, Reform and
Enforcement Act of 1989, as amended from time to time.
"First Pricing Period" means the period commencing on the
Closing Date and ending on (and including) the date occurring three (3) Business
Days after Administrative Agent receives the first Rating Notice from Borrower.
"Fiscal Quarter" means each three-month period ending on March
31, June 30, September 30 and December 31.
"Fiscal Year" means the fiscal year of Borrower which shall be
the twelve (12) month period ending on the last day of December in each year.
"Fixed Charge Coverage Ratio" means, at any time, the ratio of
(i) EBITDA for the Fiscal Quarter then most recently ended, to (ii) the sum of
(a) Fixed Charges for such period and (b) preferred dividend payments for such
period.
"Fixed Charges" means, for any period, the sum of the amounts
for such period of (i) scheduled payments of principal of Debt of the REIT and
the Consolidated Entities (other than any payment of the entire unpaid balance
of any such Debt at its final maturity or balloon payment, referred to herein as
a "bullet payment"), (ii) the REIT's and each Consolidated Entity's pro rata
share of scheduled payments of principal of Debt of Unconsolidated Joint
Ventures (other than bullet payments) that does not otherwise constitute Debt of
and is not otherwise recourse to the REIT or such Consolidated Entity or their
assets, (iii) Interest Expense, (iv) an amount equal to $0.3125 per quarter,
multiplied by the weighted average gross leasable area, measured in square feet
and weighted by acquisition date, of all Real Properties held by the REIT or any
of the Consolidated Entities, (v) the REIT's and each Consolidated Entity's pro
rata share of an amount equal to the product (the "Clause (v) Product") of
$0.3125 per quarter, multiplied by the weighted average gross leasable area,
measured in square feet and weighted by acquisition date, of all Real Properties
held by Unconsolidated Joint Ventures and (vi) Tax Expense, in each case, at the
end of such period. For purposes of clause (ii), the REIT's and such
Consolidated Entity's pro rata share of payments by any Unconsolidated Joint
Venture shall be deemed equal to the product of (a) the payments made by such
Unconsolidated Joint Venture, multiplied by (b) the percentage of the total
outstanding Capital Stock of such Unconsolidated Joint Venture held by the REIT
or such Consolidated Entity, expressed as a decimal. For purposes of clause (v),
the REIT's and such Consolidated Entity's pro rata share of the Clause (v)
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Product shall be deemed equal to the product of (a) the Clause (v) Product,
multiplied by (b) the percentage of the total outstanding Capital Stock of such
Unconsolidated Joint Ventures held by the REIT or such Consolidated Entity,
expressed as a decimal. For the purposes of the two immediately preceding
sentences, the term "Capital Stock" shall not include the interests described in
clause (ii) of the definition of "Capital Stock".
"Fixed Rate Notice" means, with respect to a LIBOR Advance
pursuant to Section 2.1(b), a notice substantially in the form of Exhibit D.
"Fixed Rate Price Adjustment" has the meaning given to such
term in Section 2.4(j)(iii).
"Funding Date" means, with respect to any Advance, the date of
the funding of such Advance.
"Funds from Operations" shall be interpreted consistently with
the NAREIT Definition and, subject to Section 11.3, shall mean, for any period,
net income for such period excluding gains (or losses) from debt restructuring
and sales of Real Property, plus the portion of Depreciation and Amortization
Expenses during such period which is attributable to Real Property, and after
adjustments for Unconsolidated Joint Ventures. (Adjustments for Unconsolidated
Joint Ventures shall be calculated to reflect funds from operations on the same
basis.)
"GAAP" means generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board and
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board, or in such other
statements by such other entity as may be in general use by significant segments
of the accounting profession, which are applicable to the circumstances as of
the date of determination.
"Governmental Authority" means any nation or government, any
federal, state, local, municipal or other political subdivision thereof or any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Gross Asset Value" means, as of the date of determination,
the sum of (without duplication):
(i) (x) the product of EBITDA of the REIT and the Consolidated
Entities for the fiscal period consisting of the Fiscal Quarter most recently
ended (less EBITDA attributable to Real Property acquired during such Fiscal
Quarter from persons other than Borrower or Affiliates of Borrower), multiplied
by 4, divided by (y) 9.75%;
(ii) Cash and Cash Equivalents held by the REIT and the
Consolidated Entities on the last day of such most recently ended Fiscal
Quarter; and
(iii) one hundred percent (100%) of the Acquisition Price for
Real Property acquired by the REIT and the Consolidated Entities (from persons
other than Borrower or Affiliates of Borrower) during such Fiscal Quarter.
"Guaranty" means a guaranty of payment in the form of Exhibit
E.
"Guaranty Obligation" means, as to any Person, any (a)
guarantee by that Person of Indebtedness of, or other obligation performable by,
any other Person or (b) assurance given by that Person to an obligee of any
other Person with respect to the performance of an obligation by, or the
financial condition of, such other Person, whether direct, indirect or
contingent, including any purchase or repurchase agreement covering such
obligation or any collateral security therefor, any agreement to provide funds
(by means of loans, capital contributions or otherwise) to such other Person,
any agreement to support the solvency or level of any balance sheet item of such
other Person or any "keep-well" or other arrangement of whatever nature given
for the purpose of assuring or holding harmless such obligee against loss with
respect to any obligation of such other Person; provided, however, that the term
Guaranty Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Guaranty
Obligation in respect of Indebtedness shall be deemed to be an amount equal to
the stated or determinable amount of the related Indebtedness (unless the
Guaranty Obligation is limited by its terms to a lesser amount, in which case to
the extent of such amount) or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof as determined by the Person
in good faith. The amount of any other Guaranty Obligation shall be deemed to be
zero unless and until the amount thereof has been (or in accordance with
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Financial Accounting Standards Board Statement No. 5 should be) quantified and
reflected or disclosed in the consolidated financial statements (or notes
thereto) of such Person.
"Indebtedness" means, as to any Person (without duplication),
(a) all indebtedness, obligations or other liabilities of such Person for
borrowed money, whether or not subordinated and whether with or without recourse
beyond any collateral security, (b) all indebtedness, obligations or other
liabilities of such Person evidenced by Securities or other similar instruments,
(c) all reimbursement obligations and other liabilities of such Person with
respect to letters of credit or banker's acceptances issued for such Person's
account, (d) all obligations of such Person to pay the deferred purchase price
of Property or services, (e) the principal portion of Capital Lease Obligations
of such Person set forth in the financial statements of such Person and, with
respect to each operating lease, including all ground leases to the extent not
treated as Capital Leases, the present value of all rental payments due over the
remaining term of such lease (using a discount rate of 10%), provided, however,
that, to the extent any ground lease payment has been deducted in determining
Net Income, then such present value shall not be counted as Indebtedness in
calculating the ratio set forth in Section 8.2, (f) all Guaranty Obligations of
such Person, (g) all Contractual Obligations of such Person, (h) all
indebtedness, obligations or other liabilities of such Person or others secured
by a Lien on any asset of such Person, whether or not such indebtedness,
obligations or liabilities are assumed by, or are a personal liability of, such
Person (including, without limitation, the principal amount of any assessment or
similar indebtedness encumbering any property), (i) all indebtedness,
obligations or other liabilities (other than interest expense liability) in
respect of foreign currency exchange agreements, (j) ERISA obligations currently
due and payable, (k) as applied to the REIT and the Consolidated Entities, all
indebtedness, obligations or other liabilities of Unconsolidated Joint Ventures
which are recourse to the REIT and/or any of the Consolidated Entities, (l) the
REIT's and Consolidated Entities' pro rata share of Nonrecourse Debt of
Unconsolidated Joint Ventures, (m) the amount which would be owed by such Person
to any counterparty under any Swap Agreement(s) in the event such Swap
Agreement(s) were terminated as of any date of determination of Indebtedness,
(n) improvement and assessment district taxes (including, without limitation,
taxes under the Mello-Roos Community Facilities Act of 1982,) assessed or
otherwise due with respect to any Property of such Person, and (o) without
duplication or limitation, all liabilities and other obligations included in the
financial statements (or notes thereto) of such Person as prepared in accordance
with GAAP. For purposes of clause (l), the REIT's and the Consolidated Entities'
pro rata share of Nonrecourse Debt of any Unconsolidated Joint Venture shall be
deemed to be equal to the product of (i) the Nonrecourse Debt of such
Unconsolidated Joint Venture, multiplied by (ii) the percentage of the total
outstanding Capital Stock of such Joint Venture held by the REIT or any
Consolidated Entity, expressed as a decimal. For purposes of the preceding
sentence, the term "Capital Stock" shall not include the interests described in
clause (ii) of the definition of "Capital Stock". With respect to any agreement
entered into by such Person to purchase Real Property, "Indebtedness" shall not
include any amount in excess of the amount (if any) which such Person is
obligated to pay as liquidated damages under such agreement in the event such
Person breaches its obligation to purchase such Real Property.
"Intangible Assets" means assets that are considered
intangible assets under GAAP, including customer lists, goodwill, computer
software, copyrights, trade names, trademarks, patents and Capitalized Loan Fees
(other than capitalized interest with respect to Construction in Progress).
"Interest Coverage Ratio" means, at any time, the ratio of (i)
EBITDA for the Fiscal Quarter then most recently ended (or, if shorter, for the
period from the Closing Date to the end of such period), to (ii) Interest
Expense for such period.
"Interest Expense" means, for any period, the sum (without
duplication) for such period of (i) total interest expense, whether paid or
accrued, of the REIT and the Consolidated Entities and the portion of any
Capitalized Lease Obligations allocable to interest expense during such period,
including the REIT's and each Consolidated Entity's share of interest expenses
in Unconsolidated Joint Ventures but excluding amortization or writeoff of debt
discount and expense (except as provided in clause (ii) below), (ii) with
respect to the REIT and the Consolidated Entities, amortization of costs related
to Swap Agreements, (iii) with respect to the REIT and the Consolidated
Entities, capitalized interest, (iv) amortization of Capitalized Loan Fees, (v)
to the extent not included in clauses (i), (ii), (iii) and (iv), the REIT's and
each Consolidated Entity's pro rata share of interest expense and other amounts
of the type referred to in such clauses of the Unconsolidated Joint Ventures,
and (vi) interest incurred on any liability or obligation that constitutes a
Guaranty Obligation of the REIT or any Consolidated Entity. For purposes of
clause (v), the REIT's and such Consolidated Entity's pro rata share of interest
expense or other amount of any Unconsolidated Joint Venture shall be deemed
equal to the product of (a) the interest expense or other relevant amount of
such Unconsolidated Joint Venture, multiplied by (b) the percentage of the total
outstanding Capital Stock of such Unconsolidated Joint Venture held by the REIT
or such Consolidated Entity, expressed as a decimal. For purposes of the
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preceding sentence, the term "Capital Stock" shall not include the interests
described in clause (ii) of the definition of "Capital Stock".
"Interest Period" means, with respect to each LIBOR Advance, a
period commencing on a Business Day and ending one (1), two (2), three (3) or
six (6) months thereafter, as specified by Borrower pursuant to Section 2.1(b),
provided that any such period that would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day unless such
Business Day falls in another calendar month, in which case such period shall
end on the immediately preceding Business Day.
"Investment" means, with respect to any Person, (i) any direct
or indirect purchase or other acquisition by that Person of stock or securities,
or any beneficial interest in stock or other securities, of any other Person,
any partnership interest (whether general or limited) in any other Person, or
all or any substantial part of the business or assets of any other Person, (ii)
any direct or indirect loan, advance or capital contribution by that Person to
any other Person, including all indebtedness and accounts receivable from that
other Person that are not current assets or did not arise from sales to that
other Person in the ordinary course of business. The amount of any Investment
shall be the original cost of such Investment, plus the cost of all additions
thereto, without any adjustments for increases or decreases in value, or
write-ups, write-downs or write-offs with respect to such Investment.
"Investment Mortgages" mean mortgages or deeds of trust
securing indebtedness owned by Borrower.
"IRS" means the Internal Revenue Service and any Person
succeeding to the functions thereof.
"Joint Venture" means a joint venture, partnership, limited
liability company, business trust or similar arrangement, whether in corporate,
partnership or other legal form; provided that, as to any such arrangement in
corporate form, such corporation shall not, as to any Person of which such
corporation is a Subsidiary, be considered to be a Joint Venture to which such
Person is a party.
"Land" means unimproved (except as otherwise provided in the
definition of "Construction in Progress") land. "Land" does not include
Construction in Progress.
"Lease Buyout Proceeds" means all proceeds received by or
otherwise payable to any Person in connection with the agreement (whether
contained in a lease or otherwise) by that Person to terminate or otherwise
cancel or shorten the term of any lease with respect to which such Person is the
lessor or landlord.
"Lender Taxes" has the meaning given to such term in Section
2.4(i)(A).
"Lenders" means LCPI (for so long as it holds an interest in a
Note) and any other bank, finance company, insurance or other financial
institution which is or becomes a party to this Agreement by execution of a
counterpart signature page hereto or an Assignment and Assumption, as assignee.
At all times that there are no Lenders other than LCPI, the terms "Lender" and
"Lenders" means LCPI (for so long as it holds an interest in a Note) in its
individual capacity. With respect to matters requiring the consent to or
approval of all Lenders at any given time, all then existing Defaulting Lenders
will be disregarded and excluded, and, for voting purposes only, "all Lenders"
shall be deemed to mean "all Lenders other than Defaulting Lenders".
"Liabilities and Costs" means all claims, judgments,
liabilities, obligations, responsibilities, losses, damages (including lost
profits), punitive or treble damages, costs, disbursements and expenses
(including, without limitation, reasonable attorneys', experts' and consulting
fees and costs of investigation and feasibility studies), fines, penalties and
monetary sanctions, interest, direct or indirect, known or unknown, absolute or
contingent, past, present or future.
"LIBOR Advance" means an Advance bearing interest at a fixed
rate of interest determined by reference to the LIBOR Rate.
"LIBOR Base Rate" means the rate per annum determined on the
basis of the rate for deposits in Dollars for a period equal to such Interest
Period commencing on the first day of such Interest Period appearing on Page
3750 of the Telerate screen as of 11:00 A.M., London time, two Business Days
prior to the beginning of such Interest Period. In the event that such rate does
not appear on Page 3750 of the Telerate screen (or otherwise on such screen),
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the "LIBOR Base Rate" for purposes of this definition shall be determined by
reference to such other comparable publicly available service for displaying
eurodollar rates as may be selected by the Administrative Agent.
"LIBOR Office" means, relative to any Lender, the office of
such Lender designated as such on the counterpart signature pages hereto or such
other office of a Lender as designated from time to time by notice from such
Lender to Administrative Agent, whether or not outside the United States, which
shall be making or maintaining LIBOR Advances of such Lender.
"LIBOR Rate" means, with respect to each day during each
Interest Period, a rate per annum determined for such day in accordance with the
following formula (rounded upward to the nearest 1/100th of 1%):
LIBOR Base Rate
--------------------------------
1.00 - LIBOR Reserve Requirement
"LIBOR Reserve Requirement" for any day, the aggregate
(without duplication) of the maximum rates (expressed as a decimal fraction) of
reserve requirements in effect on such day (including, without limitation,
basic, supplemental, marginal and emergency reserves) under any regulations of
the Federal Reserve Board or other Governmental Authority having jurisdiction
with respect thereto dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Federal Reserve Board) maintained by a member bank of the
Federal Reserve System.
"Lien" means any mortgage, deed of trust, pledge, negative
pledge, hypothecation, collateral assignment, deposit arrangement, security
interest, encumbrance (including, but not limited to, easements, rights-of-way,
zoning restrictions and the like), lien (statutory or other), preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever, including without limitation any conditional sale or other
title retention agreement, the interest of a lessor under a Capital Lease, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement or document having similar
effect (other than a financing statement filed by a "true" lessor pursuant to
9408 of the Uniform Commercial Code) naming the owner of the asset to which such
Lien relates as debtor, under the Uniform Commercial Code or other comparable
law of any jurisdiction.
"Loan Account" has the meaning given to such term in Section
2.3.
"Loan Documents" means this Agreement, the Notes, the Guaranty
and all other agreements, instruments and documents (together with amendments
and supplements thereto and replacements thereof) now or hereafter executed by
the REIT or Borrower which evidence, guarantee or secure the Obligations, in
each case either as originally executed or as the same may from time to time be
supplemented, modified, amended, renewed, extended or supplanted.
"Major Agreements" means, with respect to any Real Property
included within the Unencumbered Pool or which Borrower proposes for inclusion
within the Unencumbered Pool, (a) a lease of such Real Property with respect to
25,000 square feet or more of gross leasable area, and (b) each ground lease
affecting such Real Property.
"Material Adverse Effect" means, with respect to a Person, a
material adverse effect upon the condition (financial or otherwise), operations,
performance or properties of such Person. The phrase "has a Material Adverse
Effect" or "will result in a Material Adverse Effect" or words substantially
similar thereto shall in all cases be intended to mean "has resulted, or will or
could reasonably be anticipated to result, in a Material Adverse Effect", and
the phrase "has no (or does not have a) Material Adverse Effect" or "will not
result in a Material Adverse Effect" or words substantially similar thereto
shall in all cases be intended to mean "does not or will not or could not
reasonably be anticipated to result in a Material Adverse Effect".
"Maturity Date" has the meaning given to such term in Section
2.1(d).
"Minority Interests" means that portion of "minority
interests" as set forth in the REIT's financial statements which is attributable
to the ownership interest in Borrower of Persons other than the REIT.
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"Multiemployer Plan" means an employee benefit plan defined in
Section 4001(a)(3) of ERISA which is, or within the immediately preceding six
(6) years was, contributed to by a Person or an ERISA Affiliate.
"NAREIT Definition" has the meaning given to such term in
Section 11.3.
"Net Income" means, for any period, total net income (or loss)
of the REIT and the Consolidated Entities for such period, provided that there
shall be excluded therefrom (i) any charge attributable to, or otherwise on
account of, the Minority Interests, (ii) any income or loss attributable to
extraordinary items (including, without limitation, any income or loss
attributable to restructuring of Indebtedness), (iii) gains and losses from
sales of assets, (iv) Borrower's pro rata share of the income (or loss) of any
Unconsolidated Joint Venture for such period, and (v) except to the extent
otherwise included hereunder, the income (or loss) of any Person accrued prior
to the date it becomes a Consolidated Entity or is merged with the REIT or any
Consolidated Entity or such Person's assets are acquired by the REIT or any
Consolidated Entity. For purposes of this definition, Borrower's pro rata share
of income (or loss) of any Unconsolidated Joint Venture shall be deemed equal to
the product of (i) the income (or loss) of such Unconsolidated Joint Venture,
multiplied by (ii) the percentage of the total outstanding Capital Stock of such
Person held by Borrower, expressed as a decimal. For purposes of the preceding
sentence, the term "Capital Stock" shall not include the interests described in
clause (ii) of the definition of "Capital Stock".
"Net Offering Proceeds" means (a) all cash proceeds received
by the REIT as a result of the sale of common, preferred or other classes of
stock of the REIT (if and only to the extent reflected in stockholders' equity
on the consolidated balance sheet of the REIT prepared in accordance with GAAP)
less customary costs, expenses and discounts of issuance paid by the REIT (all
of which proceeds shall be concurrently contributed by the REIT to Borrower as
additional capital as provided in Section 6.2(h), below), plus (b) all cash and
the fair market value of the net equity of all properties contributed to
Borrower by one or more Persons in exchange for limited partnership interests in
Borrower.
"Non-Pro Rata Advance" means an Advance with respect to which
fewer than all the Lenders have funded their respective Pro Rata Shares of such
Advance and the failure of the non-funding Lender or Lenders to fund its or
their respective Pro Rata Shares of such Advance constitutes a breach of this
Agreement.
"Nonrecourse Debt" means any Debt: (a) under the terms of
which the payee's remedies upon the occurrence of a default are limited to
specific, identified assets of the payor which secure such Debt; and (b) for the
repayment of which the payor has no personal liability beyond the loss of such
specified assets, except for liability for fraud, material misrepresentations or
misuse or misapplication of insurance proceeds, condemnation awards or rents,
existence of hazardous waste or other customary exceptions to nonrecourse
provisions.
"Note" means the promissory note, which shall be substantially
in the form of Exhibit F, made by Borrower to a Lender evidencing the Advances
under that Lender's Pro Rata Share of the Commitment, either as originally
executed or as the same may from time to time be supplemented, modified,
amended, renewed, extended or supplanted.
"Notice of Borrowing" means, with respect to a proposed
Advance pursuant to Section 2.1(b), a notice substantially in the form of
Exhibit G.
"Obligations" means all present and future obligations and
liabilities of the Borrower of every type and description arising under or in
connection with this Agreement, the Notes and the other Loan Documents due or to
become due to the Lenders or any Person entitled to indemnification, or any of
their respective successors, transferees or assigns, whether for principal,
interest, fees, expenses, indemnities or other amounts (including attorneys'
fees and expenses) and whether due or not due, direct or indirect, joint and/or
several, absolute or contingent, voluntary or involuntary, liquidated or
unliquidated, determined or undetermined, and whether now or hereafter existing,
renewed or restructured, whether or not from time to time decreased or
extinguished and later increased, created or incurred, whether or not arising
after the commencement of a proceeding under the Bankruptcy Code (including
post-petition interest) and whether or not allowed or allowable as a claim in
any such proceeding, and whether or not recovery of any such obligation or
liability may be barred by a statute of limitations or such obligation or
liability may otherwise be unenforceable.
"Office Property" means any Real Property that is an office
building and any related parking facility.
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"Officer's Certificate" means a certificate signed by a
specified officer of a Person certifying as to the matters set forth therein.
"Partnership Units" has the meaning established for that term
in the Partnership Agreement of Borrower. "PBGC" means the Pension Benefit
Guaranty Corporation or any Person succeeding to the functions thereof.
"Permit" means any permit, approval, authorization, license,
variance or permission required from a Governmental Authority under an
applicable Requirement of Law.
"Permitted Liens" mean:
(a) Liens (other than Environmental Liens and any Lien imposed
under ERISA) for taxes, assessments or charges of any Governmental
Authority or claims not yet due and any such taxes, assessments,
charges or claims which are due if they are being contested by Borrower
in accordance with Section 6.1(d);
(b) Liens (other than any Lien imposed under ERISA) incurred
or deposits made in the ordinary course of business (including without
limitation surety bonds and appeal bonds) in connection with workers'
compensation, unemployment insurance and other types of social security
benefits or to secure the performance of tenders, bids, leases,
contracts (other than for the repayment of Indebtedness), and statutory
obligations;
(c) Liens imposed by laws, such as mechanics' liens and other
similar liens arising in the ordinary course of business which secure
payment of obligations not more than thirty (30) days past due or are
being contested as permitted under this Agreement;
(d) any Liens which are approved by Requisite Lenders; and
(e) rights of lessees under leases and the rights of lessors
under Capital Leases.
"Person" means any natural person, corporation, limited
partnership, general partnership, joint stock company, limited liability
company, limited liability partnership, joint venture, association, company,
trust, bank, trust company, land trust, business trust or other organization,
whether or not a legal entity, or any other nongovernmental entity, or any
Governmental Authority.
"Plan" means an employee benefit plan defined in Section 3(3)
of ERISA (other than a Multiemployer Plan) in respect of which Borrower or an
ERISA Affiliate, as applicable, is an "employer" as defined in Section 3(5) of
ERISA.
"Price Adjustment Date" has the meaning given to such term in
Section 2.4(j)(iii).
"Pricing Period" means (i) the First Pricing Period, (ii) the
period commencing on the first day after the end of the First Pricing Period and
ending on (and including) the date occurring three (3) Business Days after
Administrative Agent receives a Rating Notice and (iii) each period thereafter
commencing on the first day after the end of the immediately preceding Pricing
Period and ending on (and including) the date occurring three (3) Business Days
after Administrative Agent receives a Rating Notice.
"Pro Rata Share" means, with respect to each Lender, the
percentage of the Commitment set forth opposite the name of that Lender on
Schedule 1.1, as such percentage may be increased or decreased pursuant to an
Assignment and Assumption executed in accordance with Section 11.20.
"Proceedings" means, collectively, all actions, suits and
proceedings before, and investigations commenced or threatened by or before, any
court or Governmental Authority with respect to a Person.
"Property" means, as to any Person, any real or personal
property, building, facility, structure, equipment or unit, or other asset owned
and operated by such Person in the ordinary course of its business.
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"Property Expenses" means, for any Office Property, all
operating expenses relating to such Office Property, including the following
items (provided, however, that Property Expenses shall not include Debt Service,
tenant improvement costs, leasing commissions, capital improvements,
Depreciation and Amortization Expenses and any extraordinary items not
considered operating expenses under GAAP):
(i) all expenses for the operation of such Office Property,
including any management fees payable under management contracts, landscaping
costs, janitorial costs, costs for trash pickup and security costs and all
insurance expenses, but not including any expenses incurred in connection with a
sale or other capital or interim capital transaction;
(ii) water charges, property taxes, sewer rents and other
impositions, other than fines, penalties, interest or such impositions (or
portions thereof) that are payable by reason of the failure to pay an imposition
timely;
(iii) the cost of routine maintenance, repairs and minor
alterations, to the extent they can be expensed under GAAP; and
(iv) if Borrower's interest in such Office Property is a
ground leasehold interest, rents paid by Borrower under the ground lease for
such Office Property.
"Property Income" means, for any Office Property, all gross
revenue from the ownership and/or operation of such Office Property (but
excluding (i) income from a sale or other capital item transaction and (ii)
Lease Buyout Proceeds), service fees and charges, all tenant expense
reimbursement income payable with respect to such Office Property (but not such
reimbursement for expenditures not deducted as a Property Expense), and proceeds
of business interruption insurance specifically allocable to such Office
Property.
"Property Information" means the following information and
other items with respect to each Real Property which Borrower intends to
designate as an Unencumbered Asset to be added to the Unencumbered Pool:
(i) A physical description of such Real Property, the date
upon which such Real Property was acquired or is proposed to be acquired by
Borrower, the Acquisition Price of such Real Property, if the building located
on such Real Property or the use of such building does not conform to applicable
zoning ordinances and laws, a description of such nonconformity and whether such
building or use is a legal nonconforming use, a copy of any reports delivered to
Borrower with respect to the structural integrity of improvements located on
such Real Property and Borrower's preliminary budget for nonrevenue enhancing
capital expenditures for such Real Property for the next succeeding eight (8)
Fiscal Quarters;
(ii) A current operating statement for such Real Property,
audited or certified by Borrower as being true and correct in all material
respects and prepared in accordance with GAAP, and comparative operating
statements for the current interim fiscal period and for the previous two (2)
Fiscal Years (or such lesser period as it has been operating); provided,
however, that, if Borrower shall have owned such Real Property for less than the
period to be covered by such operating statements and comparative operating
statements, then the audit and certification requirements shall extend only to
the period of ownership by Borrower, and Borrower shall provide to
Administrative Agent complete copies of any operating statements prepared by
former owner(s) of such Real Property with respect to the remainder of the
periods required hereunder, if the same are available to Borrower;
(iii) A current Rent Roll for such Real Property, certified by
Borrower as being true and correct (or if Borrower does not presently own the
Property, a copy of the Rent Roll prepared by the seller thereof);
(iv) A "Phase I" environmental assessment of such Real
Property not more than twelve (12) months old, prepared by an environmental
engineering firm reasonably acceptable to Administrative Agent;
(v) Copies of all Major Agreements affecting such Real
Property;
(vi) A copy of Borrower's most recent Owner's or Leasehold
Policy of Title Insurance, if any, covering such Real Property or, for Real
Property to be acquired, a preliminary title report; and
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(vii) If Borrower's interest in such Real Property is a ground
leasehold interest, a copy of the ground lease pursuant to which Borrower leases
such Real Property and all amendments thereto and memoranda thereof.
"Property NOI" means, for any Office Property for any period,
(i) all Property Income for such period, minus (ii) all Property Expenses for
such period.
"Rating Notice" means written notice from Borrower to
Administrative Agent delivered within three (3) Business Days after Borrower
receives notice of each change in the rating of Borrower's long-term unsecured
senior Debt by any rating agency that has rated Borrower's long-term unsecured
senior Debt and certifying that, as of the date of such written notice, (i)
Borrower's long-term unsecured senior Debt was rated by Standard & Poor's and
Moody's Investors Service, Inc. (and setting forth such rating and certifying
thereto) and (ii) the lower of such ratings (if there are two different ratings
of Borrower's long-term unsecured senior Debt) was BBB- (which is a Standard &
Poor's rating or its equivalent by Moody's Investors Service, Inc.) or higher.
"Real Property" means each lot or parcel (or portions thereof)
of real property, improvements and fixtures thereon and appurtenances thereto
now or hereafter owned or leased by Borrower or any other Consolidated Entity.
"Regulations T, U and X" mean such Regulations of the Federal
Reserve Board as in effect from time to time.
"REIT" means Arden Realty, Inc., a Maryland corporation.
"Release" means the release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the indoor or outdoor environment or into or out of any Property,
including the movement of Contaminants through or in the air, soil, surface
water, groundwater or property.
"Remedial Action" means any action required by applicable
Environmental Laws to (a) clean up, remove, treat or in any other way address
Contaminants in the indoor or outdoor environment; (b) prevent the Release or
threat of Release or minimize the further Release of Contaminants so they do not
migrate or endanger or threaten to endanger public health or welfare or the
indoor or outdoor environment; or (c) perform pre-remedial studies and
investigations and post-remedial monitoring and care.
"Rent Roll" means, with respect to any Real Property, a rent
roll for such Real Property stating for each tenancy within such Real Property
the identity of the lessee, the suite designation of the space leased, the gross
leasable area included within such space, the date of commencement and the date
of termination of such tenancy, the periods of any options to extend or
terminate such tenancy, the base rent and any escalations or operating expense
reimbursement payable in respect of such tenancy and the type of lease (i.e.,
gross or degree to which net of expenses, taxes and other items).
"Reportable Event" means any of the events described in
Section 4043(c) of ERISA, other than an event for which the thirty (30) day
notice requirement is waived by regulations.
"Requirements of Law" means, as to any Person, the charter and
by-laws, partnership agreement or other organizational or governing documents of
such Person, and any law, rule or regulation, Permit, or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject, including without limitation, the Securities
Act, the Securities Exchange Act, Regulations T, U and X, FIRREA and any
certificate of occupancy, zoning ordinance, building, environmental or land use
requirement or Permit or occupational safety or health law, rule or regulation.
"Requisite Lenders" means: (a) as of any date of determination
if the Commitments are then in effect, Lenders whose Pro Rata Shares, in the
aggregate, are at least sixty-six and two-thirds percent (66_%), provided that
in determining such percentage at any given time, all then existing Defaulting
Lenders will be disregarded and excluded and the Pro Rata Shares of the Lenders
shall be redetermined, for voting purposes only, to exclude the Pro Rata Shares
of such Defaulting Lenders; and (b) as of any date of determination if the
Commitments have then been suspended or terminated and there are then any
outstanding Advances, Lenders holding sixty-six and two thirds percent (66_%) of
all such outstanding Advances.
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"Responsible Official" means (a) when used with reference to a
Person other than an individual, any corporate officer of such Person, general
partner of such Person, corporate officer of a corporate general partner of such
Person, or corporate officer of a corporate general partner of a partnership
that is a general partner of such Person, or any other responsible official
thereof acting on behalf thereof, and (b) when used with reference to a Person
who is an individual, such Person.
"S-11" means the Form S-11 Registration Statement under the
Securities Act filed by the REIT with the Commission on July 16, 1996, as
amended.
"Second Amended and Restated Credit Agreement" means the
Second Amended and Restated Revolving Credit Agreement, dated as of May 2, 2000
(as amended, supplemented, amended and restated, and otherwise modified from
time to time) among Borrower, as borrower thereunder, the lenders named therein,
Lehman Commercial Paper Inc., as Syndication Agent, Lehman Brothers Inc., as
Co-Lead Arranger, Bank One, N.A., as Documentation Agent, and Wells Fargo Bank,
National Association, as Administrative Agent and Co-Lead Arranger.
"Securities" means any stock, shares, voting trust
certificates, bonds, debentures, notes or other evidences of indebtedness,
secured or unsecured, convertible, subordinated or otherwise, or in general any
instruments commonly known as "securities", or any certificate of interest,
shares, or participations in temporary or interim certificates for the purchase
or acquisition of, or any right to subscribe to, purchase or acquire any of the
foregoing, but shall not include any evidence of the Obligations, provided that
Securities shall not include Cash Equivalents, Investment Mortgages or equity
investments in Unconsolidated Joint Ventures.
"Securities Act" means the Securities Act of 1933, as amended
to the date hereof and from time to time hereafter, and any successor statute.
"Securities Exchange Act" means the Securities Exchange Act of
1934, as amended to the date hereof and from time to time hereafter, and any
successor statute.
"Senior Loans" has the meaning given to such term in Section
10.4(b).
"Solvency Certificate" means, in the case of the REIT, a
certificate in the form of Exhibit H-1 and in the case of Borrower, a
certificate in the form of Exhibit H-2.
"Solvent" means as to any Person at the time of determination,
that such Person (a) owns Property the value of which (both at fair valuation
and at present fair saleable value) is greater than the amount required to pay
all of such Person's liabilities (including the probable amount of contingent
liabilities and debts); (b) is able to pay all of its debts as such debts mature
(including through refinancing on commercially reasonable terms); and (c) has
capital sufficient to carry on its business and transactions and all business
and transactions in which it is about to engage.
"Standard & Poor's" means Standard & Poor's Ratings Services,
a division of The McGraw-Hill Companies.
"Stockholders' Equity" means, as of any date of determination,
the consolidated Stockholders' Equity of the REIT as of that date determined in
accordance with GAAP and shown in the financial statements of the REIT and the
Consolidated Entities; provided that there shall be excluded from Stockholders'
Equity any amount attributable to Disqualified Stock.
"Subsidiary" means, as of any date of determination and with
respect to any Person, any corporation, limited liability company or partnership
(whether or not, in either case, characterized as such or as a "joint venture"),
whether now existing or hereafter organized or acquired: (a) in the case of a
corporation or limited liability company, of which a majority of the Securities
having ordinary voting power for the election of directors or other governing
body (other than Securities having such power only by reason of the happening of
a contingency) are at the time beneficially owned by such Person and/or one or
more Subsidiaries of such Person, or (b) in the case of a partnership, of which
a majority of the partnership or other ownership interests are at the time
beneficially owned by such Person and/or one or more of its Subsidiaries.
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"Swap Agreement" means a written agreement between Borrower
and one or more financial institutions providing for "swap", "cap", "collar",
"floor," "buy down" or other interest rate protection with respect to any
Indebtedness, in form and substance acceptable to Administrative Agent.
"Syndication Agent" means Lehman Commercial Paper Inc. or such
other Lender as is hereafter designated in writing by the Administrative Agent
to serve as Syndication Agent hereunder (subject to Section 10.15 hereof).
"Tangible Net Worth" means, at any time, the Stockholders'
Equity, plus Minority Interests, plus cumulative net additions of Depreciation
and Amortization Expense deducted in determining income for all Fiscal Quarters
ending after the date of Borrower's formation minus Intangible Assets.
"Tax Expense" means (without duplication), for any period,
total tax expense (if any) attributable to income and franchise taxes based on
or measured by income, whether paid or accrued, of the REIT and the Consolidated
Entities, including the REIT's and each Consolidated Entity's pro rata share of
tax expenses in each Unconsolidated Joint Venture. For purposes of this
definition, the REIT's and such Consolidated Entity's pro rata share of any such
tax expense of such Unconsolidated Joint Venture shall be deemed equal to the
product of (i) such tax expense of such Unconsolidated Joint Venture, multiplied
by (ii) the percentage of the total outstanding Capital Stock of such
Unconsolidated Joint Venture held by the REIT or such Consolidated Entity,
expressed as a decimal. For purposes of the preceding sentence, the term
"Capital Stock" shall not include the interests described in clause (ii) of the
definition of "Capital Stock".
"Termination Event" means (a) any Reportable Event, (b) the
withdrawal of a Person or an ERISA Affiliate of such Person from a Benefit Plan
during a plan year in which it was a "substantial employer" as defined in
Section 4001(a)(2) of ERISA, (c) the occurrence of an obligation arising under
Section 4041 of ERISA of a Person or an ERISA Affiliate of such Person to
provide affected parties with a written notice of an intent to terminate a
Benefit Plan in a distress termination described in Section 4041(c) of ERISA,
(d) the institution by the PBGC of proceedings to terminate any Benefit Plan
under Section 4042 of ERISA, (e) any event or condition which constitutes
grounds under Section 4042 of ERISA for the appointment of a trustee to
administer a Benefit Plan, (f) the partial or complete withdrawal of such Person
or any ERISA Affiliate of such Person from a Multiemployer Plan, or (g) the
adoption of an amendment by any Person or any ERISA Affiliate of such Person to
terminate any Benefit Plan.
"Total Liabilities" means, at any time, without duplication,
the aggregate amount of (i) all Indebtedness and other liabilities of the REIT
and the Consolidated Entities reflected in the financial statements of the REIT
or disclosed in the financial notes thereto, plus (ii) all liabilities of all
Unconsolidated Joint Ventures that are recourse to the REIT or any Consolidated
Entity or any of its assets or that otherwise constitute Indebtedness of the
REIT or any Consolidated Entity, plus (iii) the REIT's and each Consolidated
Entity's pro rata share of all Indebtedness and other liabilities of any
Unconsolidated Joint Venture not otherwise constituting Indebtedness of the REIT
or such Consolidated Entity, plus (iv) all Guaranty Obligations of the REIT and
the Consolidated Entities. For purposes of clause (iii), the REIT's and such
Consolidated Entity's pro rata share of all Indebtedness and other liabilities
of any Unconsolidated Joint Venture shall be deemed equal to the product of (a)
such Indebtedness or other liabilities, multiplied by (b) the percentage of the
total outstanding Capital Stock of such Person held by the REIT or such
Consolidated Entity, expressed as a decimal. For purposes of the preceding
sentence, the term "Capital Stock" shall not include the interests described in
clause (ii) of the definition of "Capital Stock". Total Liabilities shall not
include Minority Interests.
"to the best knowledge of" means, when modifying a
representation, warranty or other statement of any Person, that the fact or
situation described therein is known by the Person (or, in the case of a person
other than a natural person, known by a Responsible Official of that Person)
making the representation, warranty or other statement, or with the exercise of
reasonable due diligence under the circumstances (in accordance with the
standard of what a reasonable Person in similar circumstances would have done)
would have been known by the Person (or, in the case of a Person other than a
natural Person, would have been known by a Responsible Official of that Person).
"Unconsolidated Joint Venture" means any Joint Venture of the
REIT or any Consolidated Entity in which the REIT or such Consolidated Entity
holds any Capital Stock but which would not be combined with the REIT in the
consolidated financial statements of the REIT in accordance with GAAP.
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"Unencumbered Asset" means any Real Property designated by
Borrower that satisfies all of the following conditions:
(i) is a completed Office Property; provided, however, that
with respect to Unencumbered Assets referred to in clause (iii) of the
definition of "Unencumbered Asset Value", "completed Office Property" means an
Office Property with respect to which the appropriate Governmental Authority has
issued a temporary certificate of occupancy and the architect who prepared the
plans and specifications for such Office Property has delivered to
Administrative Agent a written certificate, in form and substance reasonably
acceptable to Administrative Agent, certifying that, other than tenant
improvements, such Office Property has been completed in substantial compliance
with such plans and specifications;
(ii) is free and clear of any Lien, other than (a) easements,
covenants, and other restrictions, charges or encumbrances not securing
Indebtedness that do not interfere materially with the ordinary operations of
such Real Property and do not materially detract from the value of such Real
Property; (b) building restrictions, zoning laws and other Requirements of Law;
and (c) leases and subleases of such Real Property in the ordinary course of
business; provided, however, if such Real Property is subject to a ground lease,
it, together with all other Real Properties in the Unencumbered Pool subject to
ground leases, shall not represent more than the lesser of (a) 25% of the
aggregate Unencumbered Asset Value of all assets in the Unencumbered Pool or (b)
25% of the total square footage of all assets in the Unencumbered Pool; and (d)
Permitted Liens;
(iii) is Wholly-Owned;
(iv) such Real Property is not less than 70% leased;
provided, however, if such Real Property is not more than 350,000 square feet
and is greater than 25% leased, it may constitute an Unencumbered Asset for up
to three Fiscal Quarters; provided further, however, (a) such Real Property
qualifying as an Unencumbered Asset pursuant to the immediately preceding
proviso, together with all other Real Properties qualifying as Unencumbered
Assets pursuant to the immediately preceding proviso (collectively, together
with this proviso, the "Less Than 70% Leased Provisos") and together with all
Unencumbered Assets the Unencumbered Asset Value of which is determined pursuant
to clause (iii) of the definition of "Unencumbered Asset Value", shall not
represent more than the lesser of (1) 10% of the aggregate Unencumbered Asset
Value of all assets in the Unencumbered Pool or (2) 10% of the total square
footage of all assets in the Unencumbered Pool, and (b) the value of such Real
Property qualifying as an Unencumbered Asset pursuant to the immediately
preceding proviso shall be either (A) if such Real Property was acquired by
Borrower as a completed Office Property, its Acquisition Price or (B) if
Borrower developed such Real Property, the sum of its Acquisition Price plus an
amount (as reasonably approved by Administrative Agent) equal to the costs
incurred by Borrower to develop such Real Property, and, in either such event,
such Real Property shall not be valued in accordance with clause (i) or (ii) of
the definition of "Unencumbered Asset Value"; and
(v) after adding such Real Property to the Unencumbered
Pool, the Real Properties in the Unencumbered Pool shall not be less than 85%
leased.
Any Real Property (a) which does not satisfy each of the
foregoing conditions, (b) which satisfies each of the foregoing conditions, but
is subject to a ground lease, (c) which satisfies each of the foregoing
conditions, but with respect to which Borrower is relying on compliance with the
Less Than 70% Leased Provisos to satisfy the foregoing condition (iv), or (d)
which satisfies each of the foregoing conditions, but not the Additional
Conditions (defined below), may constitute an Unencumbered Asset only if such
Real Property has been expressly approved by the Requisite Lenders in writing as
an Unencumbered Asset. Any Real Property (A) which satisfies each of the
foregoing conditions (provided that, with respect to condition (ii), such Real
Property is not subject to any ground lease, and with respect to condition (iv),
Borrower is not relying on compliance with the Less Than 70% Leased Provisos to
satisfy condition (iv), that is, such Real Property is not less than 70%
leased), (B) has been expressly approved by Administrative Agent alone in
writing as an Unencumbered Asset and (C) satisfies the following additional
conditions (the "Additional Conditions") and Borrower has so certified to
Administrative Agent, shall be an Unencumbered Asset:
(1) such Real Property is located in one of Borrower's
existing markets and is in conformance with current applicable zoning
laws; and
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(2) with respect to such Real Property, Borrower has received
a "Phase I" environmental assessment and a structural/physical report
and has certified to Administrative Agent that no environmental or
structural issues have been identified in those reports.
As of the date hereof all Unencumbered Assets are described on
Schedule 8.5, provided that if any Unencumbered Asset (including any of the
properties listed on Schedule 8.5) no longer satisfies any of the conditions set
forth in the foregoing clauses (i) through (v), inclusive, the Requisite Lenders
shall have the right, at any time and from time to time, to notify Borrower
that, effective upon the giving of such notice, such asset shall no longer be
considered an Unencumbered Asset. If Borrower intends to designate a Real
Property as an Unencumbered Asset to be added to the Unencumbered Pool from time
to time, it will notify the Administrative Agent of such intention, which notice
will include, with respect to such Real Property, the Property Information with
respect to such Real Property, and such other information and items as may be
reasonably requested by Administrative Agent with respect to such Real Property.
If Borrower at any time intends to withdraw any Real Property from the
Unencumbered Pool, it shall (A) notify the Administrative Agent of its
intention, and (B) deliver to the Administrative Agent a certificate of its
chief financial officer, chief executive officer or chief operating officer
setting forth the calculations establishing that Borrower will be in compliance
with Section 8.5 with giving effect to such withdrawal (and any concurrent
addition of Real Properties to the Unencumbered Pool), which calculations shall
be in such detail, and otherwise in such form and substance, as Administrative
Agent reasonably requires. Effective automatically upon receipt of such notice
and certificate by Administrative Agent (or upon any later date stated in such
notice), such Real Property shall no longer constitute an Unencumbered Asset.
The following two Real Properties are set forth in Schedule 8.5 under the
heading "Real Properties Conditionally Approved as Unencumbered Assets":
Centrelake Plaza and Havengate Center. Each such Real Property is, as of the
date of this Agreement, less than 70% leased and has thus not satisfied the
condition set forth in clause (iv) above. However, all of the Lenders agree
that, with respect to each such Real Property (1) all of the other conditions
set forth have been satisfied and (2) at such time as Borrower delivers to
Administrative Agent written evidence reasonable satisfactory to Administrative
Agent ("Borrower's Unencumbered Asset Notice") that such Real Property is 70% or
more leased and provided that, as reasonably determined by Administrative Agent,
the conditions set forth in clauses (i), (ii) and (v) above remain satisfied,
such Real Property shall become an Unencumbered Asset without any further action
by the Lenders as of the date on which Administrative Agent, in response to its
receipt of the Borrower's Unencumbered Asset Notice, gives Borrower written
confirmation that such Real Property is an Unencumbered Asset. Administrative
Agent shall deliver copies of each such notice to all Lenders. No Unencumbered
Asset shall be Construction in Progress.
"Unencumbered Asset Value" means, at any time, with respect to
a specified Unencumbered Asset (except as provided in the definition of
"Unencumbered Asset"), (i) for Unencumbered Assets that have been Wholly-Owned
by Borrower for at least one full Fiscal Quarter at such time and which are
seventy percent (70%) or more leased, the product of the Property NOI of such
Unencumbered Assets during the period of the full Fiscal Quarter ended most
recently multiplied by 4, divided by 9.75% (expressed as a decimal), or (ii) for
Unencumbered Assets that have been Wholly-Owned by Borrower for less than one
full Fiscal Quarter at such time, an amount equal to the Acquisition Price for
such Unencumbered Assets, or (iii) for Unencumbered Assets that have been
Wholly-Owned by Borrower for at least one full Fiscal Quarter at such time and
which are each more than 25% leased but less than 70% occupied (and such
Unencumbered Assets have never been 70% or more occupied) an amount equal to
either (A) if the Real Property which constitutes any such Unencumbered Asset
was acquired by Borrower as a completed Office Property, its Acquisition Price
or (B) if Borrower developed such Real Property, the sum of its Acquisition
Price plus an amount (as reasonably approved by Administrative Agent) equal to
the costs incurred by Borrower to develop such Real Property; provided, however,
that any Unencumbered Asset the Unencumbered Asset Value of which is determined
pursuant to the foregoing clause (iii) shall contain no more than 350,000 square
feet and shall constitute an Unencumbered Asset under this clause (iii) for no
more than three Fiscal Quarters; and provided further, however, that the
Unencumbered Asset Value of any Unencumbered Asset which was valued pursuant to
the foregoing clause (iii) shall be determined pursuant to clause (i) of this
definition only if the Real Property which constitutes such Unencumbered Asset
achieves 70% or more occupancy.
"Unencumbered Pool" means the pool of Unencumbered Assets.
"Unencumbered Pool Statements" has the meaning given to such
term in Section 5.1(f).
"Unmatured Event Of Default" means an event which, with the
giving of notice or the lapse of time, or both, would constitute an Event of
Default.
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"Unsecured Funded Indebtedness" means Debt that is not secured
by any Lien and includes, without limitation, outstanding Advances.
"Unsecured Interest Expense Coverage Ratio" means, at the time
of determination, the ratio of (i) Property NOI of all Unencumbered Assets for
the Fiscal Quarter then most recently ended (or, if shorter, for the period from
the Closing Date to the end of such period), to (ii) Interest Expense on all
Unsecured Funded Indebtedness for such period.
"Unused Facility Fee" has the meaning set forth in Section
2.5(b).
"Wholly-Owned" means, with respect to any Real Property, that
title to such Real Property is held in fee directly by Borrower or that Borrower
is the lessee under a ground lease approved by the Administrative Agent.
1.2 Computation of Time Periods. In this Agreement, in the
computation of periods of time from a specified date to a later specified date,
the word "from" means "from and including" and the words "to" and "until" each
mean to and including". Periods of days referred to in this Agreement shall be
counted in calendar days unless Business Days are expressly prescribed.
1.3 Terms.
(a) Any accounting terms used in this Agreement which are not
specifically defined shall be construed in conformity with, and all financial
data required to be submitted by this Agreement shall be prepared in conformity
with, GAAP, except as otherwise specifically prescribed in this Agreement.
(b) In each case where the consent or approval of
Administrative Agent, all the Lenders and/or the Requisite Lenders is required,
or their non-obligatory action is requested by Borrower, such consent, approval
or action shall be in the sole and absolute discretion of Administrative Agent
and, as applicable, each Lender, unless otherwise specifically indicated.
(c) Any time the word "or" is used herein, unless the context
otherwise clearly requires, it has the inclusive meaning represented by the
phrase "and/or". The words "hereof", "herein", "hereby", "hereunder" and similar
terms refer to this Agreement as a whole and not to any particular provision of
this Agreement. Article, section, subsection, clause, exhibit and schedule
references are to this Agreement unless otherwise specified. Any reference in
this Agreement to this Agreement or to any other Loan Document includes any and
all amendments, modifications, supplements, renewals or restatements thereto or
thereof, as applicable.
ARTICLE 2
---------
ADVANCES
--------
2.1 Loan Advances and Repayment.
(a) Loan Availability. Subject to the terms and conditions set
forth in this Agreement, the Lenders hereby agree to make Advances to Borrower
from time to time during the period from the Closing Date to the Business Day
next preceding the Maturity Date, subject to the following:
(x) subject to Section 2.7 and Section 2.8, the aggregate
principal amount of all outstanding Advances shall not at any time
exceed Seventy-Five Million Dollars ($75,000,000); and
(y) the aggregate principal amount of all outstanding Advances
shall not at any time exceed the lesser of (1) the Commitment or (2)
the amount which, when combined with all components of the unsecured
Total Liabilities of the REIT and the date Consolidated Entities other
than outstanding Advances as of the of determination, is equal to
57.1429% of the aggregate Unencumbered Asset Value of the Unencumbered
Pool as of such date.
All Advances under this Agreement shall be made by the Lenders simultaneously
and proportionately to their respective Pro Rata Shares. Borrower acknowledges
and agrees that neither the Administrative Agent nor any Lender shall be
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responsible for any failure by any other Lender to perform its obligation to
make an Advance hereunder and that the Pro Rata Share of 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 an Advance. Advances may be
voluntarily prepaid pursuant to Section 2.6(a) and, subject to the provisions of
this Agreement, any amounts so prepaid may be reborrowed under this Section
2.1(a). Interest shall accrue and be payable on outstanding Advances as provided
in Section 2.4. The principal balance of the Advances shall be payable in full
on the Maturity Date. The obligation of Borrower to repay Advances may be
evidenced by the Notes.
(b) Notice of Borrowing. (i) Whenever Borrower desires to
borrow under this Section 2.1, Borrower shall giveAdministrative Agent, at
Lehman Brothers Inc., 101 Hudson Street, 30th Floor, Jersey City, New Jersey
07302 (telephone: (201) 524-4603; telecopier: (201) 524-4439), with a copy to:
Lehman Brothers Inc., 3 World Financial Center, 12th Floor, New York, New York
10285-1200 (telephone: (212) 526-6970; telecopier: (212) 526-0035), or at such
other addresses as Administrative Agent shall designate, an original or
facsimile Notice of Borrowing no later than 12:00 Noon (New York City time), not
less than three (3) nor more than five (5) Business Days prior to the proposed
Funding Date of each Advance. Each Notice of Borrowing shall specify (A) the
Funding Date (which shall be a Business Day) of the proposed Advance, (B) the
amount of the proposed Advance, provided that the aggregate amount of such
proposed Advance shall equal Twenty-Five Million Dollars ($25,000,000), (C)
whether the Advance to be made thereunder will be a Base Rate Advance or a LIBOR
Advance and, if a LIBOR Advance, the Interest Period, and (D) the proposed use
of such Advance. Any Notice of Borrowing pursuant to this Section 2.1(b) shall
be irrevocable.
(ii) Borrower may elect (A) to convert LIBOR Advances
or any portion thereof into Base Rate Advances, or (B) to convert Base
Rate Advances or any portion thereof to LIBOR Advances, or (C) to
convert LIBOR Advances or any portion thereof into new LIBOR Advances,
provided, however, that the aggregate amount of the Advances being
converted into or continued as LIBOR Advances shall, in the aggregate,
equal Twenty-Five Million Dollars ($25,000,000). The conversion of a
LIBOR Advance to a Base Rate Advance or to a new LIBOR Advance shall
only occur on the last Business Day of the Interest Period relating to
such LIBOR Advance. Each election under clause (B) above shall be made
by Borrower giving Administrative Agent an original or facsimile Notice
of Borrowing no later than 12:00 Noon (New York City time), not less
than three (3) nor more than five (5) Business Days prior to the date
of proposed conversion to a LIBOR Advance. Each election under clause
(C) above shall be made by Borrower giving Administrative Agent an
original or facsimile Notice of Borrowing no later than 12:00 Noon (New
York City time), not less than three (3) nor more than five (5)
Business Days prior to the last day of the Interest Period for the
LIBOR Advance in question. Each Notice of Borrowing delivered pursuant
to this Section 2.1(b)(ii) shall specify (1) the amount of the new
LIBOR Advance or Base Rate Advance, as the case may be, (2) with
respect to a new LIBOR Advance, the Interest Period therefor, and (3)
the date of the effectiveness of the LIBOR Rate or Base Rate, as the
case may be (which date shall be a Business Day).
(iii) Upon receipt of a Notice of Borrowing in proper
form requesting LIBOR Advances under subparagraph (i) or (ii) above,
Administrative Agent shall deliver a copy thereof (by facsimile) to
each Lender by 2:00 P.M. (New York City time) on the same day of
Administrative Agent's receipt thereof and shall determine the LIBOR
Rate applicable to the Interest Period for such LIBOR Advances, and
shall, two (2) Business Days prior to the beginning of such Interest
Period, give (by facsimile) a Fixed Rate Notice in respect thereof to
Borrower and the Lenders; provided, however, that failure to give such
notice to Borrower shall not affect the validity of such rate. Each
determination by Administrative Agent of the LIBOR Rate shall be
conclusive and binding upon the parties hereto in the absence of
manifest error.
(iv) If Borrower does not make a timely election to
convert all or a portion of a LIBOR Advance into a new LIBOR Advance in
accordance with Section 2.1(b)(ii), such LIBOR Advance shall be
automatically converted to a Base Rate Advance upon expiration of the
Interest Period applicable to such LIBOR Advance.
(c) Making of Advances. Subject to Section 10.3 or as
otherwise provided herein, Administrative Agent shall transfer the proceeds of
each new Advance to Borrower's account number 001-223275 at City National Bank,
400 North Roxbury Drive, Suite 800, Beverly Hills, CA 90210, ABA#1220-16066.
(d) Term. The outstanding balance of the Advances shall be
payable in full on the earliest to occur of, (i) July 27, 2002 (as such date may
be extended pursuant to Section 2.1(e)), (ii) the acceleration of the Advances
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pursuant to Section 9.2(a), or (iii Borrower's written notice to Administrative
Agent (pursuant to Section 2.8) of Borrower's election to prepay all accrued
Obligations and terminate the Commitment (said earliest date referred to herein
as the "Maturity Date").
(e) Extension of the Maturity Date. During the period
commencing not more than ninety (90) days prior to, and ending not less than
thirty (30) days prior to, the second anniversary of the Closing Date (the
"Initial Maturity Date"), Borrower may request a one-year extension of the
Maturity Date by delivering written notice of such request to Administrative
Agent. Within five (5) Business Days after Administrative Agent's receipt of
such written request, Administrative Agent shall deliver a copy of such written
request to each Lender. No later than fifteen Business Days after the
Administrative Agent has received such written notice from the Borrower, the
Administrative Agent shall deliver to the Borrower written notification of the
interest rates and Applicable LIBOR Rate Margin which will be applicable for the
extension period, which shall be the rates reasonably determined by the
Administrative Agent to be then applicable in the market for senior unsecured
loans to borrowers of similar credit standing as Borrower. Notwithstanding the
foregoing, in no event shall the Administrative Agent be required to deliver
such notification earlier than the date which is forty-five (45) days prior to
the Initial Maturity Date. If Borrower executes and delivers to the
Administrative Agent an acceptance of the quoted market rates no later than
three Business Days prior to the original Maturity Date, the extension shall
become effective, the Maturity Date shall be extended to July 27, 2003, and the
Applicable LIBOR Rate Margin shall be the rates accepted by Borrower. If
Borrower does not accept the quoted market rates, the original Maturity Date
shall not be extended.
2.2 Authorization to Obtain Advances. Schedule 2.2 sets forth
the names of those employees of Borrower authorized by Borrower to sign Notices
of Borrowing, and Administrative Agent and Lenders shall be entitled to rely on
such Schedule until notified in writing by Borrower of any change(s) of the
persons so authorized. Administrative Agent shall be entitled to act on the
instructions of anyone identifying himself or herself as one of the Persons
authorized to execute a Notice of Borrowing, and Borrower shall be bound thereby
in the same manner as if such Person were actually so authorized. Borrower
agrees to indemnify, defend and hold Lenders and Administrative Agent harmless
from and against any and all Liabilities and Costs which may arise or be created
by the acceptance of instructions in any Notice of Borrowing, unless caused by
the gross negligence or willful misconduct of the Person to be indemnified.
2.3 Lenders' Accounting. Administrative Agent shall maintain a
loan account (the "Loan Account") on its books in which shall be recorded (a)
the names and addresses and the Pro Rata Shares of the Commitment of each of the
Lenders, and the principal amount of Advances owing to each Lender from time to
time, and (b) all Advances and repayments of principal and payments of accrued
interest, as well as payments of fees required to be paid pursuant to this
Agreement. All entries in the Loan Account shall be made in accordance with
Administrative Agent's customary accounting practices as in effect from time to
time. Monthly or at such other interval as is customary with Administrative
Agent's practice, Administrative Agent will render a statement of the Loan
Account to Borrower and will deliver a copy thereof to each Lender. Each such
statement shall be deemed final, binding and conclusive upon Borrower in all
respects as to all matters reflected therein (absent manifest error).
2.4 Interest on the Advances.
(a) Base Rate Advances. Subject to Section 2.4(f), all Base
Rate Advances shall bear interest on the daily unpaid principal amount thereof
from the date made until paid in full at a fluctuating rate per annum equal to
the Base Rate.
(b) LIBOR Advances. Subject to Sections 2.4(f) and 2.4(j),
LIBOR Advances shall bear interest on the unpaid principal amount thereof during
the Interest Period applicable thereto at a rate per annum equal to the sum of
the LIBOR Rate for such Interest Period plus the Applicable LIBOR Rate Margin.
No more than six (6) LIBOR Advances shall be outstanding at any one time.
Notwithstanding anything to the contrary contained herein and subject to the
default interest provisions contained in Section 2.4(f), if an Event of Default
occurs and as a result thereof the Commitment is terminated, all LIBOR Advances
will convert to Base Rate Advances upon the expiration of the applicable
Interest Periods therefor or the date all Advances become due, whichever occurs
first.
(c) [Reserved].
(d) [Reserved].
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(e) Interest Payments. Subject to Section 2.4(f), interest
accrued on all Advances shall be payable by Borrower, in the manner provided in
Section 2.6(b), in arrears on the first Business Day of the first calendar month
following the Closing Date, the first Business Day of each succeeding calendar
month thereafter, and on the Maturity Date.
(f) Default Interest. Notwithstanding the rates of interest
specified in Sections 2.4(a) and 2.4(b) and the payment dates specified in
Section 2.4(e), effective at the option of Requisite Lenders following the
occurrence and during the continuance of any Event of Default, the principal
balance of all Advances then outstanding and, to the extent permitted by
applicable law, any interest payments not paid when due, shall bear interest,
payable upon demand, at a rate which is five percent (5%) per annum in excess of
the rate(s) of interest otherwise payable from time to time under this
Agreement. Notwithstanding anything to the contrary in any of the other Loan
Documents, all other amounts due Administrative Agent or the Lenders (whether
directly or for reimbursement) under this Agreement or any of the other Loan
Documents if not paid when due, or if no time period is expressed, if not paid
within ten (10) days after demand, shall bear interest from and after demand at
the rate set forth in this Section 2.4(f).
(g) Late Fee. Borrower acknowledges that late payment to
Administrative Agent will cause Administrative Agent and the Lenders to incur
costs not contemplated by this Agreement. Such costs include, without
limitation, processing and accounting charges. Therefore, if Borrower fails
timely to pay any sum due and payable hereunder through the Maturity Date,
unless waived by Administrative Agent pursuant to the last sentence of this
Section 2.4(g) or by the Requisite Lenders, a late charge of four cents ($.04)
for each dollar of any such principal payment, interest or other charge which is
due hereon and which is not paid within fifteen (15) days after such payment is
due, shall be charged by Administrative Agent (for the benefit of Lenders) and
paid by Borrower for the purpose of defraying the expense incident to handling
such delinquent payment. Borrower, the Lenders and Administrative Agent agree
that this late charge represents a reasonable sum considering all of the
circumstances existing on the date hereof and represents a fair and reasonable
estimate of the costs that Administrative Agent and the Lenders will incur by
reason of late payment. Borrower, the Lenders and Administrative Agent further
agree that proof of actual damages would be costly and inconvenient. Acceptance
of any late charge shall not constitute a waiver of the default with respect to
the overdue installment, and shall not prevent Administrative Agent from
exercising any of the other rights available hereunder or under any other Loan
Document. Such late charge shall be paid without prejudice to any other rights
or remedies of Administrative Agent or any Lender. The Lenders agree that,
notwithstanding the foregoing, no such late charge shall be charged by
Administrative Agent or any Lender if the outstanding Advances are then bearing
interest at the default rate of interest set forth in Section 2.4(f).
Administrative Agent is hereby authorized on behalf of all the Lenders, without
the necessity of any notice to, or further consent from, any Lender, to waive
the imposition of the late fees provided for in this Section 2.4(g) up to a
maximum of three (3) times per calendar year.
(h) Computation of Interest. Interest shall be computed on the
basis of the actual number of days elapsed in the period during which interest
or fees accrue and a year of three hundred sixty (360) days. In computing
interest on any Advance, subject to Section 2.6(b), the date of the making of
the Advance shall be included and the date of payment shall be excluded;
provided, however, that if an Advance is repaid on the same day on which it is
made, one (1) day's interest shall be paid on that Advance. Notwithstanding any
provision in this Section 2.4, interest in respect of any Advance shall not
exceed the maximum rate permitted by applicable law.
(i) Changes; Legal Restrictions. In the event that, after the
Closing Date, (i the adoption of or any change in any law, treaty, rule,
regulation, guideline or determination of a court or Governmental Authority or
any change in the interpretation or application thereof by a court or
Governmental Authority, or (ii) compliance by Administrative Agent or any Lender
with any request or directive made or issued after the Closing Date (whether or
not having the force of law and whether or not the failure to comply therewith
would be unlawful) from any central bank or other Governmental Authority or
quasi-governmental authority:
(A65535 subjects Administrative Agent or any Lender to any
tax, duty or other charge of any kind with respect to the Commitment,
this Agreement or any of the other Loan Documents, including the Notes
or the Advances, or changes the basis of taxation of payments to
Administrative Agent or such Lender of principal, fees, interest or any
other amount payable hereunder, except for net income, gross receipts,
gross profits or franchise taxes imposed by any jurisdiction and not
specifically based upon loan transactions (all such non-excepted taxes,
duties and other charges being hereinafter referred to as "Lender
Taxes");
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(B65535 imposes, modifies or holds applicable, in the
determination of Administrative Agent or any Lender, any reserve,
special deposit, compulsory loan, FDIC insurance, capital allocation or
similar requirement against assets held by, or deposits or other
liabilities in or for the account of, advances or loans by, or other
credit extended by, or any other acquisition of funds by,
Administrative Agent or such Lender or any applicable lending office
(except to the extent that the reserve and FDIC insurance requirements
are reflected in the "Base Rate" or in determining the LIBOR Rate); or
(C65535 imposes on Administrative Agent or any Lender any
other condition materially more burdensome in nature, extent or
consequence than those in existence as of the Closing Date,
and the result of any of the foregoing is to increase the cost to Administrative
Agent or any Lender of making, renewing, maintaining or participating in the
Advances or to reduce any amount receivable thereunder; then, in any such case,
Borrower shall promptly pay to Administrative Agent or such Lender, as
applicable, within seven (7) days after Borrower's receipt of written demand,
such amount or amounts (based upon a reasonable allocation thereof by
Administrative Agent or such Lender to the financing transactions contemplated
by this Agreement and affected by this Section 2.4(i)) as may be necessary to
compensate Administrative Agent or such Lender for any such additional cost
incurred or reduced amounts received. Administrative Agent or such Lender shall
deliver to Borrower and in the case of a delivery by such Lender, such Lender
shall also deliver to Administrative Agent, a written statement of the claimed
additional costs incurred or reduced amounts received and the basis therefor as
soon as reasonably practicable after such Lender obtains knowledge thereof. If
Administrative Agent or any Lender subsequently recovers any amount of Lender
Taxes previously paid by Borrower pursuant to this Section 2.4(i), whether
before or after termination of this Agreement, then, upon receipt of good funds
with respect to such recovery, Administrative Agent or such Lender will refund
such amount to Borrower if no Event of Default or Unmatured Event of Default
then exists or, if an Event of Default or Unmatured Event of Default then
exists, such amount will be credited to the Obligations in the manner determined
by Administrative Agent or such Lender.
(j) Certain Provisions Regarding LIBOR Advances.
(i) LIBOR Lending Unlawful. If any Lender shall
determine (which determination shall, upon notice thereof to Borrower
and Administrative Agent, be conclusive and binding on the parties
hereto) that after the Closing Date the introduction of or any change
in or in the interpretation of any law makes it unlawful, or any
central bank or other Governmental Authority asserts that it is
unlawful, for such Lender to make or maintain any Advance as a LIBOR
Advance, (A) the obligations of such Lender to make or maintain any
Advances as LIBOR Advances shall, upon such determination, forthwith be
suspended until such Lender shall notify Administrative Agent that the
circumstances causing such suspension no longer exist (and such Lender
shall give notice if such circumstances no longer exist), and (B) if
required by such law or assertion, the existing LIBOR Advances of such
Lender shall automatically convert into Base Rate Advances.
(ii) Deposits Unavailable. If Administrative Agent
shall have determined in good faith that adequate means do not exist
for ascertaining the interest rate applicable hereunder to LIBOR
Advances, then, upon notice from Administrative Agent to Borrower the
obligations of all the Lenders to make or maintain Advances as LIBOR
Advances shall forthwith be suspended until Administrative Agent shall
notify Borrower that the circumstances causing such suspension no
longer exist. Administrative Agent will give such notice when it
determines, in good faith, that such circumstances no longer exist;
provided, however, that neither Administrative Agent nor any Lender
shall have any liability to any Person with respect to any delay in
giving such notice.
(iii) Fixed Rate Price Adjustment. Borrower
acknowledges that prepayment or acceleration of a LIBOR Advance during
an Interest Period shall result in the Lenders incurring additional
costs, expenses and/or liabilities and that it is extremely difficult
and impractical to ascertain the extent of such costs, expenses and/or
liabilities. (For all purposes of this subparagraph (iii), any Advance
not being made as a LIBOR Advance in accordance with the Notice of
Borrowing therefor, as a result of Borrower's cancellation thereof,
shall be treated as if such LIBOR Advance had been prepaid.) Therefore,
on the date a LIBOR Advance is prepaid or the date all sums payable
hereunder become due and payable, by acceleration or otherwise ("Price
Adjustment Date"), Borrower shall pay to Administrative Agent, for the
account of each Lender, in addition to all other sums then owing, an
amount ("Fixed Rate Price Adjustment") equal to the then present value
of (A) the amount of interest that would have accrued on the LIBOR
Advance for the remainder of the Interest Period at the rate applicable
to such LIBOR Advance, less (B) the amount of interest that would
accrue on the same LIBOR Advance for the same period if the LIBOR Rate
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were set on the Price Adjustment Date. The present value shall be
calculated by using as a discount rate the LIBOR Rate quoted on the
Price Adjustment Date. Within seven (7) days after Borrower's receipt
of written notice from Administrative Agent, Borrower shall immediately
pay to Administrative Agent, for the account of the Lenders, the Fixed
Rate Price Adjustment as calculated by Administrative Agent. Such
written notice (which shall include calculations in reasonable detail)
shall, in the absence of manifest error, be conclusive and binding on
the parties hereto.
(iv) Borrower understands, agrees and acknowledges
the following: (A65535 no Lender has any obligation to purchase, sell
and/or match funds in connection with the use of the LIBOR Rate as a
basis for calculating the rate of interest on a LIBOR Rate Advance or a
Fixed Rate Price Adjustment; (B) the LIBOR Rate is used merely as a
reference in determining such rate and/or Fixed Rate Price Adjustment;
and (C) Borrower has accepted the LIBOR Rate as a reasonable and fair
basis for calculating such rate and a Fixed Rate Price Adjustment.
Borrower further agrees to pay the Fixed Rate Price Adjustment and
Lender Taxes, if any, whether or not a Lender elects to purchase, sell
and/or match funds.
(k) Withholding Tax Exemption. At least five (5) Business Days
prior to the first day 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
Administrative Agent and Borrower two (2) duly completed copies of United States
Internal Revenue Service Form W-8BEN or Form W-8ECI (and any necessary Form
W-8IMY), certifying in either case that such Lender is entitled to receive
payments under this Agreement without deduction or withholding of any United
States federal income taxes and a valid and duly completed and executed Internal
Revenue Service Form W-8 or W-9. Each Lender which so delivers a Form W-8BEN or
Form W-8ECI further undertakes to deliver to Administrative Agent and Borrower
two (2) additional copies of such form (or any applicable 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 Administrative Agent or Borrower, in each case
certifying that such Lender is entitled to receive payments under this Agreement
without deduction or withholding of any United States federal income taxes,
unless an event (including without limitation any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable or which would
prevent such Lender from duly completing and delivering any such form with
respect to it and such Lender advises Administrative Agent that it is not
capable of receiving payments without any deduction or withholding of United
States federal income taxes. If any Lender cannot deliver such form, then
Borrower may withhold from such payments such amounts as are required by the
Code.
2.5 Fees.
(a) [Reserved].
(b) Unused Facility Fee. From and after the Closing Date and
until the earlier of the date on which (x) the Commitment has been fully drawn
by Borrower or (y) the Obligations are paid in full and this Agreement is
terminated or, if sooner, the date the Commitment terminates, and subject to
Section 10.4(b), Borrower shall pay to Administrative Agent, for the account of
each Lender, a fee (the "Unused Facility Fee") accruing at a rate of 0.25% per
annum upon an amount equal to (i) $75,000,000 less all reductions in the
Commitment pursuant to Section 2.7 or Section 2.8 minus (ii) the average daily
principal balance of all outstanding Advances as determined for each Fiscal
Quarter.
The Unused Facility Fee shall be payable, in the manner
provided in Section 2.5(e), in arrears on the first Business Day of each Fiscal
Quarter, beginning with the first Fiscal Quarter after the Closing Date, and
shall be payable on the Maturity Date, or, if sooner, the date the Commitment
terminates or on the date of payment in full of all Obligations. The Unused
Facility Fee shall be prorated for any period of less than a full Fiscal
Quarter.
(c) [Reserved].
(d) Extension Fee. If the Maturity Date is extended pursuant
to Section 2.1(e), Borrower shall pay to Administrative Agent, for distribution
to each Lender which holds a Pro Rata Share of the Commitment following such
extension pursuant to Section 2.1(e), a fee in an amount equal to 0.375% of the
Commitment payable to each such Lender. Such fee shall be due and payable by
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Borrower to Administrative Agent for the benefit of the Lenders within three (3)
Business Days after the extension becomes effective pursuant to Section 2.1(e).
(e) Payment of Fees. The fees described in this Section 2.5
represent compensation for services rendered and to be rendered separate and
apart from the lending of money or the provision of credit and do not constitute
compensation for the use, detention or forbearance of money, and the obligation
of Borrower to pay the fees described herein shall be in addition to, and not in
lieu of, the obligation of Borrower to pay interest, other fees and expenses
otherwise described in this Agreement. All fees shall be payable when due in
immediately available funds and shall be nonrefundable when paid. If Borrower
fails to make any payment of fees or expenses specified or referred to in this
Agreement due to Administrative Agent or the Lenders, including without
limitation those referred to in this Section 2.5, in Section 11.1, or otherwise
under this Agreement or any separate fee agreement between Borrower and
Administrative Agent or any Lender relating to this Agreement, when due, the
amount due shall bear interest until paid at the Base Rate and after ten (10)
days at the rate specified in Section 2.4(f) (but not to exceed the maximum rate
permitted by applicable law), and shall constitute part of the Obligations. The
Unused Facility Fee shall be calculated on the basis of a 360-day year and the
actual number of days elapsed.
2.6 Payments.
(a) Voluntary Prepayments. Borrower may, upon not less than
three (3) Business Days prior written notice to Administrative Agent not later
than 1:00 P.M. (New York City time) on the date given, at any time and from time
to time, prepay any Advances in whole or in part. Any notice of prepayment given
to Administrative Agent under this Section 2.6(a) shall specify the date of
prepayment and the aggregate principal amount of the prepayment. In the event of
a prepayment of LIBOR Advances, Borrower shall pay any Fixed Rate Price
Adjustment payable in respect thereof in accordance with Section 2.4(j).
Administrative Agent shall provide to each Lender a confirming copy of such
notice on the same Business Day such notice is received.
(b) Manner and Time of Payment. All payments of principal,
interest and fees hereunder payable to Administrative Agent or the Lenders shall
be made without condition or reservation of right and free of set-off or
counterclaim, in Dollars and by wire transfer (pursuant to Administrative
Agent's written wire transfer instructions) of immediately available funds, to
Administrative Agent, for the account of each Lender entitled thereto not later
than 1:00 P.M. (New York City time) on the date due; and funds received by
Administrative Agent after that time and date shall be deemed to have been paid
on the next succeeding Business Day.
(c) Payments on Non-Business Days. Whenever any payment to be
made by Borrower hereunder shall be stated to be due on a day which is not a
Business Day, such payment shall be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the payment of
interest hereunder and of any of the fees specified in Section 2.5, as the case
may be.
2.7 Notice of Increased Costs. Each Lender agrees that, as
promptly as reasonably practicable after it becomes aware of the occurrence of
an event or the existence of a condition which would cause it to be affected by
any of the events or conditions described in Section 2.4(i) or (j), it will
notify Borrower, and provide a copy of such notice to Administrative Agent, of
such event and the possible effects thereof, provided that the failure to
provide such notice shall not affect such Lender's rights to reimbursement
provided for herein. Provided no Event of Default or Unmatured Event of Default
has occurred and is continuing, Borrower shall have the right (the "Payoff
Right") to pay to such Lender all principal, accrued and unpaid interest and any
other amounts (collectively, the "Payoff Amount") due such Lender under this
Agreement and the other Loan Documents (including amounts due such Lender under
Section 2.4(i)). Borrower may exercise the Payoff Right only by delivering
written notice of Borrower's exercise of such Payoff Right to such Lender, the
Administrative Agent and the other Lenders within 15 days after Borrower's
receipt of written notice from such Lender that Borrower owes amounts under
Section 2.4(i) and thereafter paying, in immediately available funds, the Payoff
Amount to such Lender within such 15-day period. Upon such Lender's receipt of
the Payoff Amount, such Lender's Pro Rata Share of the Commitment shall be
terminated, the Commitment shall be reduced by an amount equal to such Lender's
Pro Rata Share of the Commitment and the Pro Rata Shares of the Commitment of
the remaining Lenders shall be adjusted and the Administrative Agent shall give
written notice to each of the Lenders of the adjusted Pro Rata Shares.
2.8 Voluntary Termination or Reduction of Commitment. At any
time prior to the Maturity Date, Borrower may, upon not less than 5 Business
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Days' prior written notice to the Administrative Agent, terminate the Commitment
in effect or permanently reduce the Commitment in effect by an aggregate minimum
amount of Twenty-Five Million Dollars ($25,000,000) or any multiple of Five
Million Dollars ($5,000,000) in excess thereof; provided, however, that no such
termination or reduction shall be permitted if, after giving effect thereto and
to any prepayment of Advances made on the effective date of such termination or
reduction, as the case may be, the then outstanding principal amount of the
Advances would exceed the Commitment in effect; and provided further, however,
that once terminated or reduced in accordance with this Section 2.8, the
Commitment in effect may not thereafter be reinstated or increased. All accrued
and unpaid fees due under Section 2.5 with respect to the portion of the
Commitment in effect being terminated or reduced shall be paid to the
Administrative Agent on the funding date of such termination or reduction.
ARTICLE 3
---------
CONDITIONS TO ADVANCES
----------------------
3.1 Conditions to Initial Advances. The obligation of the
Lenders to make the initial Advances shall be subject to the satisfaction or
waiver by the Requisite Lenders of each of the following conditions precedent on
or before July 27, 2000:
(a) Borrower Loan Documents. Borrower shall have executed and
delivered to Administrative Agent each of the following, in form and substance
acceptable to Administrative Agent and each other Lender:
(i) this Agreement;
(ii) the Notes; and
(iii) all other documents which Administrative Agent
reasonably requires to be executed by or on behalf of Borrower.
(b) REIT Loan Documents. The REIT shall have executed
and delivered to Administrative Agent each of the following, in form
and substance acceptable to Administrative Agent and each other Lender:
(i) the Guaranty; and
(ii) all other documents which Administrative
Agent reasonably requires to be executed by or on behalf of the REIT.
(c) Corporate and Partnership Documents. Administrative Agent
shall have received the corporate and partnership formation and other governing
documents of the Borrower and the REIT, and a certificate of each such entity's
Secretary or an officer comparable thereto with respect to authorization,
incumbency and all organizational documents.
(d) Solvency. Each of the REIT and Borrower shall be Solvent
and shall have delivered to Administrative Agent a Solvency Certificate to that
effect.
(e) Fees and Expenses. Administrative Agent shall have
received all fees then due to Administrative Agent and to the Lenders and shall
have received reimbursement for all costs and expenses for which Borrower is
obligated pursuant to Section 11.1 and for which Borrower has received an
invoice, and Borrower shall have performed all of its other obligations as set
forth in the Loan Documents to make payments to Administrative Agent on or
before the Closing Date and all expenses of Administrative Agent incurred prior
to such Closing Date and for which Borrower has received an invoice shall have
been paid by Borrower.
(f) Opinion of Counsel. Administrative Agent shall have
received, on behalf of Administrative Agent and the Lenders, favorable opinions
of counsel for Borrower and the REIT dated as of the Closing Date, in form and
substance reasonably satisfactory to Administrative Agent, the Lenders and their
respective counsel.
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(g) Consents and Approvals. All material licenses, permits,
consents, regulatory approvals and corporate action necessary to enter into the
financing transactions contemplated by this Agreement shall have been obtained
by Borrower and the REIT.
(h) City National Bank Loan. Administrative Agent shall have
received copies of all of the documents evidencing the City National Bank Loan
and shall have approved (which approval shall not be unreasonably withheld) such
documents.
3.2 Conditions Precedent to All Advances. The obligation of
each Lender to make any Advance (including the initial Advance) requested to be
made by it, on any date, is subject to the satisfaction or waiver by the
Requisite Lenders of the following conditions precedent as of such date:
(a) Notice of Borrowing. With respect to a request for an
Advance, Administrative Agent shall have received, on or before the Funding Date
and in accordance with the provisions of Section 2.1(b), an original and duly
executed Notice of Borrowing.
(b) Additional Matters. As of the Funding Date for any Advance
and after giving effect to the Advance being requested:
(i) No Default. After giving effect to the requested
Advance, no Event of Default or Unmatured Event of Default shall have
occurred and be continuing or would result from the making of the
requested Advance (it being intended that the Lenders shall have no
obligation to fund any Advance during the period allowed under this
Agreement for cure of any event or condition which, if not cured during
such period, would become an Event of Default), and all of the
covenants contained in Sections 7.3 and 7.4, and Article 8 shall be
satisfied;
(ii) Representations and Warranties. All of the
representations and warranties contained in this Agreement and in any
other Loan Document (other than those representations and warranties
which expressly provide that they speak as of a certain date (e.g., "as
of the Closing Date")) shall be true and correct in all material
respects on and as of such Funding Date, as though made on and as of
such date, and Borrower shall so certify;
(iii) No Material Adverse Change (Borrower and REIT).
No change shall have occurred which shall have a Material Adverse
Effect on Borrower or the REIT, as determined by Administrative Agent;
(iv) Material Adverse Change (Unencumbered Asset). If
a change shall have occurred which shall have a Material Adverse Effect
on any Unencumbered Asset or the operating performance thereof, as
determined by Administrative Agent, the Unencumbered Asset Value of
such Unencumbered Asset shall not be included in the aggregate
Unencumbered Asset Value of the Unencumbered Pool for purposes of
Section 2.1(a)(y);
(v) Litigation Proceedings. There shall not have been
instituted or threatened, any litigation or proceeding in any court or
before any Governmental Authority affecting or threatening to affect
Borrower or the REIT which, if adversely determined, would have a
Material Adverse Effect on Borrower or the REIT, as reasonably
determined by Administrative Agent; and
(vi) Compliance with Section 8.5. Borrower shall be
in compliance with Section 8.5 after such Advance is made.
Each submission by Borrower to Administrative Agent of a Notice of Borrowing
with respect to an Advance and the acceptance by Borrower of the proceeds of
each such Advance made hereunder shall constitute a representation and warranty
by Borrower as of the Funding Date in respect of such Advance that all the
conditions contained in this Section 3.2 have been satisfied.
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ARTICLE 4
---------
REPRESENTATIONS AND WARRANTIES
------------------------------
4.1 Representations and Warranties as to Borrower, Etc. In
order to induce the Lenders to make the Advances, Borrower hereby represents and
warrants to Administrative Agent and the Lenders as follows:
(a) Organization; Partnership Powers. Borrower (i) is a
limited partnership duly organized, validly existing and in good standing under
the laws of Maryland, (ii) is duly qualified to do business as a foreign limited
partnership and in good standing under the laws of California and each other
jurisdiction in which it owns or leases real property or in which the nature of
its business requires it to be so qualified, except for those jurisdictions
where failure to so qualify and be in good standing would not have a Material
Adverse Effect on Borrower, and (iii) has all requisite partnership power and
authority to own, operate and encumber its Property and assets and to conduct
its business as presently conducted and as proposed to be conducted in
connection with and following the consummation of the transactions contemplated
by the Loan Documents.
(b) Authority. Borrower has the requisite partnership power
and authority to execute, deliver and perform each of the Loan Documents to
which it is or will be a party. The execution, delivery and performance thereof,
and the consummation of the transactions contemplated thereby, have been duly
authorized by all necessary actions. Each of the Loan Documents to which
Borrower is a party has been duly and validly executed and delivered by Borrower
and constitutes its legal, valid and binding obligation, enforceable against it
in accordance with its terms, subject to bankruptcy, insolvency and other laws
affecting creditors' rights generally and general equitable principles.
(c) Ownership of Borrower. All of the Partnership Units of
Borrower are validly issued and non-assessable and as of the Closing Date are
owned of record in the percentage amounts and by the Persons set forth on
Schedule 4.1(c), as amended from time to time. As of the Closing Date, the REIT
owns 63,273,871 Partnership Units of Borrower, free and clear of any Liens. Such
Partnership Units were offered and sold in compliance in all material respects
with all Requirements of Law (including, without limitation, federal and state
securities laws). Except as set forth in Schedule 4.1(c), there are no
outstanding securities convertible into or exchangeable for Partnership Units of
Borrower, or options, warrants or rights to purchase any such Partnership Units,
or commitments of any kind for the issuance of additional Partnership Units or
any such convertible or exchangeable securities or options, warrants or rights
to purchase such Partnership Units. The REIT is the sole general partner of
Borrower.
(d) No Conflict. The execution, delivery and performance by
Borrower of the Loan Documents to which it is or will be a party, and each of
the transactions contemplated thereby, do not and will not (i) conflict with or
violate Borrower's limited partnership agreement or certificate of limited
partnership or other organizational documents, as the case may be, or (ii)
conflict with, result in a breach of or constitute (with or without notice or
lapse of time or both) a default under any Requirement of Law, Contractual
Obligation or Court Order of or binding upon Borrower, which would have a
Material Adverse Effect on Borrower or (iii) require termination of any
Contractual Obligation, which termination would have a Material Adverse Effect
on Borrower or (iv) result in or require the creation or imposition of any Lien
whatsoever upon any of the Properties or assets of Borrower (other than
Permitted Liens).
(e) Consents and Authorizations. Borrower has obtained all
consents and authorizations required pursuant to its Contractual Obligations
with any other Person, and shall have obtained all consents and authorizations
of, and effected all notices to and filings with, any Governmental Authority, as
may be necessary to allow Borrower to lawfully execute, deliver and perform its
obligations under the Loan Documents to which Borrower is a party, except to the
extent that failure to obtain any such consent or authorization or to effect
such notice or filing would not have a Material Adverse Effect on Borrower.
(f) Governmental Regulation. Neither Borrower nor the REIT is
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, the Interstate Commerce Act, the Investment Company Act of
1940 or any other federal or state statute or regulation such that its ability
to incur indebtedness is limited or its ability to consummate the transactions
contemplated by the Loan Documents is materially impaired.
(g) Financial Statements; Projections and Forecasts. Each of
the financial statements to be delivered to Administrative Agent pursuant to
Sections 5.1(b) and (c) (i) has been, or will be, as applicable, prepared in
accordance with the books and records of the REIT and the Consolidated Entities
on a consolidated basis, and (ii) either fairly present in all material
respects, or will fairly present in all material respects, as applicable, the
financial condition of the REIT and the Consolidated Entities on a consolidated
basis, at the dates thereof (and, if applicable, subject to normal year-end
adjustments) and the results of its operations and cash flows, on a consolidated
basis, for the period then ended. Each of the projections delivered to
Administrative Agent prior to the date hereof and each of the projected
consolidated cash flows to be delivered to Administrative Agent pursuant to
Section 5.1(e), (A) has been, or will be, as applicable, prepared by the REIT in
light of the past business and performance of the REIT or its predecessors in
interest on a consolidated basis and (B) represent, or will represent, as of the
date thereof, the reasonable good faith estimates of the REIT's financial
personnel as of their respective dates.
(h) Prior Operating Statements. Each of the operating
statements pertaining to each of the Unencumbered Assets in the Unencumbered
Pool prepared by Borrower and delivered to Administrative Agent prior to the
date hereof under the Second Amended and Restated Credit Agreement was prepared
in accordance with GAAP in effect on the date such operating statement of each
such Unencumbered Asset was prepared and fairly presents the results of
operations of such Unencumbered Asset for the period then ended; provided,
however, that no representation is made with respect to any period prior to the
ownership of such Unencumbered Asset by Borrower.
(i) Unencumbered Pool Statements and Projections. Each of the
Unencumbered Pool Statements to be delivered to Administrative Agent pursuant to
Section 5.1(f) (i) has been or will be, as applicable, prepared in accordance
with the books and records of the applicable Unencumbered Asset and (ii) fairly
presents or will fairly present in all material respects, as applicable, the
results of operations of such Unencumbered Asset for the period then ended;
provided, however, that no representation is made with respect to any period
prior to the ownership of such Unencumbered Asset by Borrower.
(j) Litigation; Adverse Effects. (i) Except as otherwise
disclosed on Schedule 4.1(j), there is no action, suit, proceeding, governmental
investigation or arbitration, at law or in equity, or before or by any
Governmental Authority, pending or, to the best of Borrower's knowledge,
threatened against Borrower or any Property of Borrower which, if adversely
determined, would result in a Material Adverse Effect on Borrower.
(ii) Borrower is not (A) in violation of any
applicable law, which violation has a Material Adverse Effect on
Borrower, or (B) subject to or in default with respect to any Court
Order which has a Material Adverse Effect on Borrower. There are no
material Proceedings pending or, to the best of Borrower's knowledge,
threatened against Borrower or any Unencumbered Asset which, if
adversely decided, would have a Material Adverse Effect on Borrower.
(k) No Material Adverse Change. Since December 31, 1998, (i)
there has occurred no event which has a Material Adverse Effect on Borrower, and
(ii) no material adverse change in Borrower's ability to perform its obligations
under the Loan Documents to which it is a party or the transactions contemplated
thereby has occurred.
(l) Payment of Taxes. All tax returns and reports to be filed
by Borrower have been timely filed, and all taxes, assessments, fees and other
governmental charges shown on such returns or otherwise payable by Borrower have
been paid when due and payable (other than real property taxes, which may be
paid prior to delinquency so long as no penalty or interest shall attach
thereto), except such taxes, if any, as are reserved against in accordance with
GAAP and are being contested in good faith by appropriate proceedings or such
taxes, the failure to make payment of which when due and payable will not have,
in the aggregate, a Material Adverse Effect on Borrower. Borrower has no
knowledge of any proposed tax assessment against Borrower that will have a
Material Adverse Effect on Borrower, which is not being actively contested in
good faith by Borrower.
(m) Material Adverse Agreements. Borrower is not a party to or
subject to any Contractual Obligation or other restriction contained in its
limited partnership agreement, certificate of limited partnership or similar
governing documents which has a Material Adverse Effect on Borrower.
(n) Performance. Borrower is not in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any Contractual Obligation applicable to it, and no
condition exists which, with the giving of notice or the lapse of time or both,
would constitute a default under such Contractual Obligation, except where the
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consequences, direct or indirect, of such default or defaults, if any, will not
have a Material Adverse Effect on Borrower.
(o) Federal Reserve Regulations. No part of the proceeds of
the Advances hereunder will be used to purchase or carry any "margin security"
as defined in Regulation U or for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any margin
security or for any other purpose which might constitute this transaction a
"purpose credit" within the meaning of said Regulation U. Neither Borrower nor
the REIT is engaged primarily in the business of extending credit for the
purpose of purchasing or carrying out any "margin stock" as defined in
Regulation U. No part of the proceeds of the Advances hereunder will be used for
any purpose that violates, or which is inconsistent with, the provisions of
Regulation X or any other regulation of the Federal Reserve Board.
(p) Disclosure. The representations and warranties of Borrower
contained in the Loan Documents and all certificates, financial statements and
other documents delivered to Administrative Agent in connection therewith, do
not contain any untrue statement of a material fact or omit to state a material
fact necessary, in order to make the statements contained herein or therein, in
light of the circumstances under which they were made, not misleading; provided
no representation is made as to any information in the financial reports for any
Real Property prior to its ownership by Borrower. The factual information in any
document, certificate or written statement (including, without limitation, the
S-11) furnished to the Administrative Agent by or on behalf of the REIT or any
other Consolidated Entity with respect to the business, assets, prospects,
results of operations or financial condition of the REIT, Borrower or any other
Consolidated Entity, including operating statements and Rent Rolls for periods
when the Real Property covered by such statements or Rent Rolls is owned by
Borrower, for use in connection with the transactions contemplated by this
Agreement, was true and correct in all material respects as of the applicable
date. There is no fact known to the REIT, Borrower or any Consolidated Entity
that has a Material Adverse Effect on Borrower, the REIT and/or any such
Consolidated Entity or could reasonably be expected to have a Material Adverse
Effect on Borrower, the REIT and/or any such Consolidated Entity, which has not
been disclosed herein or in such other documents, certificates and statements.
Borrower has given to Administrative Agent true, correct and complete copies of
all Major Agreements, organizational documents, financial statements of the REIT
and the Consolidated Entities, Unencumbered Pool Statements and all other
documents and instruments referred to in the Loan Documents as having been
delivered to Administrative Agent. The Administrative Agent acknowledges that
certain of such documents and instruments were delivered pursuant to the Second
Amended and Restated Credit Agreement. Borrower has not intentionally withheld
any material fact from Administrative Agent in regard to any matter raised in
the Loan Documents which would cause its representations and warranties to be
misleading. Notwithstanding the foregoing, with respect to projections of
Borrower's future performance such representations and warranties are made in
good faith and to the best judgment of Borrower as of the date thereof.
(q) Requirements of Law. The REIT and the Consolidated
Entities are in compliance with all Requirements of Law (including without
limitation the Securities Act and the Securities Exchange Act, and the
applicable rules and regulations thereunder, state securities law and "Blue Sky"
laws) applicable to it and its respective businesses, in each case, where the
failure to so comply will have a Material Adverse Effect on any such Person. The
REIT has made all filings with and obtained all consents of the Commission
required under the Securities Act and the Securities Exchange Act in connection
with the execution, delivery and performance by the REIT of the Loan Documents.
(r) Patents, Trademarks, Permits, etc. The REIT and the
Consolidated Entities own, are licensed or otherwise have the lawful right to
use, or have, all permits and other governmental approvals, patents, trademarks,
trade names, copyrights, technology, know-how and processes used in or necessary
for the conduct of each such Person's business as currently conducted, the
absence of which would have a Material Adverse Effect upon such Person. The use
of such permits and other governmental approvals, patents, trademarks, trade
names, copyrights, technology, know-how and processes by each such Person does
not infringe on the rights of any Person, subject to such claims and
infringements as do not, in the aggregate, give rise to any liability on the
part of any such Person which would have a Material Adverse Effect on any such
Person.
(s) Environmental Matters. Except as set forth on Schedule
4.1(s) or in any phase I environmental or other reports delivered to
Administrative Agent, to the best knowledge of Borrower (i) the operations of
the REIT and Borrower comply in all material respects with all applicable,
local, state and federal environmental, health and safety Requirements of Law
("Environmental Laws"); (ii) none of the Unencumbered Assets or operations
thereon are subject to any Remedial Action or other Liabilities and Costs
arising from the Release or threatened Release of a Contaminant into the
environment in violation of any Environmental Laws, which Remedial Action or
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other Liabilities and Costs would have a Material Adverse Effect on Borrower
and/or the REIT; (iii) neither the REIT nor Borrower has filed any notice under
applicable Environmental Laws reporting a Release of a Contaminant into the
environment in violation of any Environmental Laws, except as the same may have
been heretofore remedied; (iv) there is not now on or in any Unencumbered Assets
(except in compliance in all material respects with all applicable Environmental
Laws): (A) any underground storage tanks, (B) any asbestos-containing material,
or (C) any polychlorinated biphenyls (PCB's) used in hydraulic oils, electrical
transformers or other equipment owned by such Person; and (v) neither the REIT
nor Borrower has received any notice or claim to the effect that it is or may be
liable to any Person as a result of the Release or threatened Release of a
Contaminant into the environment which would have a Material Adverse Effect on
the REIT or any of the Consolidated Entities.
(t) Solvency. Borrower is and will be Solvent after giving
effect to the disbursements of the Advances and the payment and accrual of all
fees then payable.
(u) Title to Assets. Borrower has good, indefeasible and
merchantable title to all Properties, including, without limitation, all
Unencumbered Assets, owned or leased by it.
(v) Management Agreements. Except as disclosed on Schedule
4.1(v) (as amended from time to time), Borrower is not a party or subject to any
management or "ground" leasing agreement with respect to any of the Properties
included within the Unencumbered Pool.
(w) Intercompany Indebtedness. Borrower does not have any
Indebtedness owed to the REIT.
4.2 Representations and Warranties as to the REIT. In order to
induce Lenders to make the Advances, Borrower hereby represents and warrants to
Administrative Agent and the Lenders as follows:
(a) Organization; Corporate Powers. The REIT (i) is a
corporation duly organized, validly existing and in good standing under the laws
of Maryland, (ii) is duly qualified to do business as a foreign corporation and
in good standing under the laws of each jurisdiction in which it owns or leases
real property or in which the nature of its business requires it to be so
qualified, except for those jurisdictions where failure to so qualify and be in
good standing will not have a Material Adverse Effect on the REIT, and (iii) has
all requisite corporate power and authority to own, operate and encumber its
property and assets and to conduct its business as presently conducted and as
proposed to be conducted in connection with and following the consummation of
the transactions contemplated by the Loan Documents.
(b) Authority. The REIT has the requisite corporate power and
authority to execute, deliver and perform each of the Loan Documents to which it
is or will be a party. The execution, delivery and performance thereof, and the
consummation of the transactions contemplated thereby, have been duly authorized
by the Board of Directors of the REIT, and no other corporate proceedings on the
part of the REIT are necessary to consummate such transactions. Each of the Loan
Documents to which the REIT is a party has been duly executed and delivered by
the REIT and constitutes its legal, valid and binding obligation, enforceable
against it in accordance with its terms, subject to bankruptcy, insolvency and
other laws affecting creditors' rights generally and general equitable
principles.
(c) No Conflict. The execution, delivery and performance by
the REIT of the Loan Documents to which it is party, and each of the
transactions contemplated thereby, do not and will not (i) conflict with or
violate its articles of incorporation, by-laws or other organizational
documents, (ii) conflict with, result in a breach of or constitute (with or
without notice or lapse of time or both) a default under any Requirement of Law,
Contractual Obligation or Court Order of or binding upon the REIT, which would
have a Material Adverse Effect on the REIT, (iii) require termination of any
Contractual Obligation, which termination would have a Material Adverse Effect
on the REIT, (iv) result in or require the creation or imposition of any Lien
whatsoever upon any of the Properties or assets of the REIT, or (v) require any
approval of the stockholders of the REIT.
(d) Consents and Authorizations. The REIT has obtained all
consents and authorizations required pursuant to its Contractual Obligations
with any other Person, and, prior to the Closing Date, shall have obtained all
consents and authorizations of, and effected all notices to and filings with,
any Governmental Authority, as may be necessary to allow the REIT to lawfully
execute, deliver and perform its obligations under the Loan Documents to which
the REIT is a party.
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(e) Capitalization. All of the capital stock of the REIT has
been issued in compliance in all material respects with all applicable
Requirements of Law.
(f) Litigation; Adverse Effects. (i) There is no action, suit,
proceeding, governmental investigation or arbitration, at law or in equity, by
or before any Governmental Authority, pending or, to best of Borrower's
knowledge, threatened against the REIT or any Property of the REIT, which will
(A) result in a Material Adverse Effect on the REIT, (B) materially and
adversely affect the ability of any party to any of the Loan Documents to
perform its obligations thereunder, or (C) materially and adversely affect the
ability of the REIT to perform its obligations as contemplated in the Loan
Documents.
(ii) The REIT is not (A) in violation of any
applicable law, which violation has a Material Adverse Effect on the
REIT, or (B) subject to or in default with respect to any Court Order
which has a Material Adverse Effect on the REIT. There are no
Proceedings pending or, to the best of Borrower's knowledge, threatened
against the REIT, which, if adversely decided, would have a Material
Adverse Effect on the REIT or Borrower.
(g) No Material Adverse Change. Since December 31, 1998, (i)
there has occurred no event which has a Material Adverse Effect on the REIT, and
(ii) no material adverse change has occurred in the REIT's ability to perform
its obligations under the Loan Documents to which it is a party or the
transactions contemplated thereby.
(h) Payment of Taxes. All tax returns and reports to be filed
by the REIT have been timely filed, and all taxes, assessments, fees and other
governmental charges shown on such returns have been paid when due and payable,
except such taxes, if any, as are reserved against in accordance with GAAP and
are being contested in good faith by appropriate proceedings or such taxes, the
failure to make payment of which when due and payable would not have, in the
aggregate, a Material Adverse Effect on the REIT. The REIT has no knowledge of
any proposed tax assessment against the REIT that would have a Material Adverse
Effect on the REIT, which is not being actively contested in good faith by the
REIT.
(i) Material Adverse Agreements. The REIT is not a party to or
subject to any Contractual Obligation or other restriction contained in its
charter, by-laws or similar governing documents which has a Material Adverse
Effect on the REIT or the ability of the REIT to perform its obligations under
the Loan Documents to which it is a party.
(j) Performance. The REIT is not in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any Contractual Obligation applicable to it, and no
condition exists which, with the giving of notice or the lapse of time or both,
would constitute a default under such Contractual Obligation, except where the
consequences, direct or indirect, of such default or defaults, if any, would not
have a Material Adverse Effect on the REIT.
(k) Disclosure. The representations and warranties of the REIT
contained in the Loan Documents, and all certificates, financial statements and
other documents delivered to Administrative Agent in connection therewith, do
not contain any untrue statement of a material fact or omit to state a material
fact necessary, in order to make the statements contained herein or therein, in
light of the circumstances under which they were made, not misleading. The REIT
has not intentionally withheld any material fact from Administrative Agent in
regard to any matter raised in the Loan Documents which would cause its
representations and warranties to be misleading. Notwithstanding the foregoing,
with respect to projections of the REIT's future performance such
representations and warranties are made in good faith and to the best judgment
of the management of the REIT as of the date thereof.
(l) ERISA. Neither the REIT nor any ERISA Affiliate thereof
(including, for all purposes under this Section 4.2(1), Borrower and the other
Consolidated Entities) has in the past five (5) years maintained or contributed
to or currently maintains or contributes to any Benefit Plan other than the
Benefit Plans identified on Schedule 4.2(1) (as such Schedule may be amended
from time to time). Neither the REIT nor any ERISA Affiliate thereof has during
the past five (5) years maintained or contributed to or currently maintains or
contributes to any employee welfare benefit plan within the meaning of Section
3(1) of ERISA which provides benefits to retirees other than benefits required
to be provided under Section 4980B of the Code and Sections 601 through 608 of
ERISA (or any successor provisions thereto) or applicable state law. Neither the
REIT nor any ERISA Affiliate thereof is now contributing nor has it ever
contributed to or been obligated to contribute to any Multiemployer Plan, no
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employees or former employees of the REIT, or such ERISA Affiliate, have been
covered by any Multiemployer Plan in respect of their employment by the REIT,
and no ERISA Affiliate of the REIT has or is likely to incur any withdrawal
liability with respect to any Multiemployer Plan which would have a Material
Adverse Effect on the REIT.
(m) Solvency. The REIT is and will be Solvent after giving
effect to the disbursements of the Advances and the payment and accrual of all
fees then payable.
(n) Status as a REIT. The REIT (i) has, since the beginning of
its first taxable year, qualified and maintained, and shall maintain, its
classification as a real estate investment trust as defined in Section 856 of
the Code, (ii) has not engaged in any "prohibited transactions" as defined in
Section 856(b)(6)(iii) of the Code, (iii) for its current "tax year" (as defined
in the Code) is, and for all subsequent taxable years shall be entitled to a
dividends paid deduction which meets the requirements of Section 857 of the Code
and (iv) its ownership and method of operation enable it to meet the
requirements for taxation as a real estate investment trust under the Code.
(o) Ownership. As of the Closing Date, the REIT does not own
or have any direct interest in any other Person, other than its ownership of the
general partnership interests in Borrower and its ownership of all of the
ownership interests in Arden Realty Finance, Inc. and Arden Realty Finance II,
Inc.
(p) NYSE Listing. The common stock of the REIT is, and is
reasonably expected to be, listed for trading and traded on the New York Stock
Exchange.
ARTICLE 5
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REPORTING COVENANTS
-------------------
Borrower covenants and agrees that, on and after the date
hereof, until payment in full of all of the Obligations, the expiration of the
Commitment and termination of this Agreement:
5.1 Financial Statements and Other Financial and Operating
Information. Borrower shall maintain or cause to be maintained a system of
accounting established and administered in accordance with sound business
practices and consistent with past practice to permit preparation of quarterly
and annual financial statements in conformity with GAAP, and each of the
financial statements described below shall be prepared on a consolidated basis
for the REIT and the other Consolidated Entities from such system and records.
Borrower shall deliver or cause to be delivered to Administrative Agent (with
copies of bound materials sufficient for each Lender):
(a) Commission Filings. Promptly following their filing with
the Commission, copies of all required reports and filings filed with the
Commission, including, without limitation, the Annual Report on Form 10-K, the
Quarterly Reports on Form 10-Q, registration statements, proxy statements and
the annual reports delivered to the shareholders of the REIT and the
Consolidated Entities.
(b) Annual Financial Statements. Within ninety (90) days after
the close of each Fiscal Year, consolidated balance sheets, statements of
operations, stockholders' equity and cash flows for the REIT and the
Consolidated Entities (in the form provided to the Commission on the REIT's Form
10-K), audited and certified without qualification by the Accountants and
accompanied by a statement that, in the course of their audit (conducted in
accordance with GAAP), the Accountants obtained no knowledge that an Event of
Default or Unmatured Event of Default occurred. To the extent Administrative
Agent desires additional details or supporting information with respect to
Unconsolidated Joint Ventures or individual Real Properties which are not
Unencumbered Assets within the Unencumbered Pool and which details and
information are not contained in the REIT's Form 10-K, Borrower shall provide
Administrative Agent with such details or supporting information as
Administrative Agent requests which is reasonably available to Borrower. Without
limiting the foregoing, at Administrative Agent's request, within ninety (90)
days after the end of each Fiscal Year, Borrower, with respect to Real Property
which is not included within the Unencumbered Pool, shall provide to
Administrative Agent operating statements and a schedule setting forth the
percentage of leasable area leased to tenants in occupancy, with footnotes
indicating which leases are in default in rent payments by more than forty-five
(45) days (other than technical, nonmaterial disputes concerning percentage
rentals due) and any other material provisions in respect to which Borrower has
issued a notice of default, for such Real Property.
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(c) Quarterly Financial Statements Certified by Officers. As
soon as practicable, and in any event within forty-five (45) days after the end
of each Fiscal Quarter, consolidated balance sheets, statements of operations,
stockholders' equity and statements of cash flow for the REIT and the
Consolidated Entities, prepared in accordance with GAAP, which may, in the case
of the first three Fiscal Quarters, be in the form provided to the Commission on
the REIT's Form 10-Q, and certified by the REIT's chief executive officer, chief
operating officer, chief financial officer or chief accounting officer.
(d) Officer's Certificate of Borrower. Together with each
delivery of any financial statement pursuant to subsection (c) above, (i) an
Officer's Certificate of the REIT, stating that the executive officer who is the
signatory thereto (which officer shall be the chief executive officer, the chief
operating officer, the chief financial officer or the chief accounting officer
of the REIT) has reviewed, or caused under his or her supervision to be
reviewed, the terms of this Agreement and the other principal Loan Documents,
and has made, or caused to be made under his or her supervision, a review in
reasonable detail of the transactions and condition of the REIT and the
Consolidated Entities during the accounting period covered by such financial
statements of the REIT and the Consolidated Entities, and that such review has
not disclosed the existence at the end of such accounting period, and that the
signers do not have knowledge of the existence as of the date of the Officer's
Certificate, of any condition or event which constitutes an Event of Default or
Unmatured Event of Default, or, if any such condition or event exists,
specifying the nature and period of existence thereof and what action has been
taken, is being taken and is proposed to be taken with respect thereto; and (ii)
a Compliance Certificate demonstrating in reasonable detail (which detail shall
include actual calculations and such supporting information as Administrative
Agent may reasonably require) compliance at the end of such accounting periods
with the covenants contained in Section 7.3 and Article 8.
(e) Cash Flow Projections. As soon as practicable, and in any
event, within one hundred twenty (120) days after the end of each Fiscal Year,
projected consolidated cash flows for the REIT and the Consolidated Entities for
the following Fiscal Year. Borrower shall also provide such additional
supporting details as Administrative Agent may reasonably request.
(f) Unencumbered Pool Statements and Operating Results. As
soon as practicable, and in any event within forty-five (45) days after the end
of each Fiscal Quarter, quarterly operating statements for each Unencumbered
Asset in the Unencumbered Pool, in a form approved by Administrative Agent,
which operating statements shall include actual quarterly and year-to-date
operating income results, and Rent Rolls for each Unencumbered Asset within the
Unencumbered Pool dated as of the last day of such Fiscal Quarter (the
"Quarterly Unencumbered Pool Statements"), in form and substance satisfactory to
Administrative Agent, certified as being true and correct in all material
respects by the REIT's chief financial officer, chief accounting officer, chief
executive officer or chief operating officer. In addition, as soon as
practicable, and in any event within forty-five (45) days after the end of the
fourth Fiscal Quarter, a year-end operating statement, in form approved by
Administrative Agent, which operating statement shall include year-to-date net
operating income and net cash flow results for each Unencumbered Asset within
the Unencumbered Pool dated as of the last day of such Fiscal Quarter
(collectively, with the Quarterly Unencumbered Pool Statements, the
"Unencumbered Pool Statements"). Administrative Agent shall also have the right
to request (i) monthly operating statements for each Unencumbered Asset in the
Unencumbered Pool in form and substance similar to the quarterly operating
statements required above and (ii) the foregoing information with respect to any
Real Property owned by the REIT or any Consolidated Entity.
(g) Budgets for Unencumbered Pool. Not later than fifteen (15)
days prior to the beginning of each Fiscal Year, annual operating budgets
(including, without limitation, overhead items and capital expenditures) for
each Unencumbered Asset in the Unencumbered Pool for such Fiscal Year, prepared
on an annual basis, in a form approved by Administrative Agent, together with
all supporting details reasonably requested by Administrative Agent, and
certified by the chief executive officer, chief operating officer, chief
financial officer or chief accounting officer of the REIT as being based upon
the REIT's reasonable good faith estimates, information and assumptions at the
time.
(h) Knowledge of Event of Default. Promptly upon a Responsible
Official of Borrower or the REIT obtaining knowledge (i) of any condition or
event which constitutes an Event of Default or Unmatured Event of Default, or
becoming aware that any Lender has given notice or taken any other action with
respect to a claimed Event of Default or Unmatured Event of Default or (ii) of
any condition or event which has a Material Adverse Effect on Borrower or the
REIT, an Officer's Certificate specifying the nature and period of existence of
any such condition or event, or specifying the notice given or action taken by
such Lender and the nature of such claimed Event of Default, Unmatured Event of
Default, event or condition, and what action Borrower and/or the REIT has taken,
is taking and proposes to take with respect thereto.
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(i) Litigation, Arbitration or Government Investigation.
Promptly upon a Responsible Official of Borrower or the REIT obtaining knowledge
of (i) the institution of, or threat of, any material action, suit, proceeding,
governmental investigation or arbitration against or affecting Borrower or the
REIT not previously disclosed in writing by Borrower to Administrative Agent
pursuant to this Section 5.1(i) or (ii) any material development in any action,
suit, proceeding, governmental investigation or arbitration already disclosed,
which, in either case, has, or if adversely determined is reasonably likely to
have, a Material Adverse Effect on Borrower or the REIT, a notice thereof to
Administrative Agent and such other information as may be reasonably available
to it to enable Administrative Agent, the Lenders and their counsel to evaluate
such matters.
(j) ERISA Termination Event. As soon as possible, and in any
event within thirty (30) days after a Responsible Official of Borrower or the
REIT knows that a Termination Event has occurred, a written statement of the
chief financial officer of the REIT describing such Termination Event and the
action, if any, which Borrower, the REIT or any ERISA Affiliate of any of them
has taken, is taking or proposes to take, with respect thereto, and, when known,
any action taken or threatened by the IRS, the DOL or the PBGC with respect
thereto.
(k) Prohibited ERISA Transaction. As soon as possible, and in
any event within thirty (30) days, after a Responsible Official of Borrower, the
REIT or any ERISA Affiliate of any of them knows that a prohibited transaction
(defined in Section 406 of ERISA and Section 4975 of the Code and which is not
subject to a statutory or prohibited transaction class exemption) has occurred,
a statement of the chief financial officer of the REIT describing such
transaction.
(l) Benefit Plan Annual Report. On request of Administrative
Agent, within thirty (30) days after the filing thereof with the DOL, the IRS or
the PBGC, copies of each annual report, including Schedule B thereto, filed with
respect to each Benefit Plan of Borrower, the REIT or any ERISA Affiliate of any
of them.
(m) Benefit Plan Funding Waiver Request. Within thirty (30)
days after the filing thereof with the IRS, a copy of each funding waiver
request filed with respect to any Benefit Plan of Borrower, the REIT or any
ERISA Affiliate of any of them and all communications received by Borrower, the
REIT or any ERISA Affiliate of any of them with respect to such request.
(n) Establishment of Benefit Plan and Increase in
Contributions to the Benefit Plan. Not less than ten (10) days prior to the
effective date thereof, a notice to Administrative Agent of the establishment of
a Benefit Plan (or the incurrence of any obligation to contribute to a
Multiemployer Plan) by Borrower, the REIT or any ERISA Affiliate of any of them.
Within thirty (30) days after the first to occur of an amendment of any then
existing Benefit Plan of Borrower, the REIT or any ERISA Affiliate of any of
them which will result in an increase in the benefits under such Benefit Plan or
a notification of any such increase, or the establishment of any new Benefit
Plan by Borrower, the REIT or any ERISA Affiliate of any of them or the
commencement of contributions to any Benefit Plan to which Borrower, the REIT or
any ERISA Affiliate of any of them was not previously contributing, a copy of
said amendment, notification or Benefit Plan.
(o) Qualification of ERISA Plan. Promptly upon, and in any
event within thirty (30) days after, receipt by Borrower, the REIT or any ERISA
Affiliate of any of them of an unfavorable determination letter from the IRS
regarding the qualification of a Plan under Section 401(a) of the Internal
Revenue Code, a copy of said determination letter, if such disqualification
would have a Material Adverse Effect on Borrower or the REIT.
(p) Multiemployer Plan Withdrawal Liability. Promptly upon,
and in any event within thirty (30) days after receipt by Borrower, the REIT or
any ERISA Affiliate of any of them of a notice from a Multiemployer Plan
regarding the imposition of material withdrawal liability, a copy of said
notice.
(q) Failure to Make Section 412 Payment. Promptly upon, and in
any event within thirty (30) days after, Borrower, the REIT or any ERISA
Affiliate of any of them fails to make a required installment under subsection
(m) of Section 412 of the Internal Revenue Code or any other payment required
under Section 412 of the Internal Revenue Code on or before the due date for
such installment or payment, a notification of such failure, if such failure
could result in either the imposition of a Lien under said Section 412 or
otherwise have or could reasonably be anticipated to have a Material Adverse
Effect on Borrower or the REIT.
(r) Failure of the REIT to Qualify as Real Estate Investment
Trust. Promptly upon, and in any event within forty-eight (48) hours after a
Responsible Official of Borrower first has actual knowledge of (i) the REIT
failing to continue to qualify as a real estate investment trust as defined in
Section 856 of the Internal Revenue Code (or any successor provision thereof),
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(ii) any act by the REIT causing its election to be taxed as a real estate
investment trust to be terminated, (iii) any act causing the REIT to be subject
to the taxes imposed by Section 857(b)(6) of the Internal Revenue Code (or any
successor provision thereto), or (iv) the REIT failing to be entitled to a
dividends paid deduction which meets the requirements of Section 857 of the
Internal Revenue Code, a notice of any such occurrence or circumstance.
(s) Asset Acquisitions and Dispositions, Indebtedness, Merger,
Etc. Without limiting, modifying or waiving any restriction in the Loan
Documents, concurrently with notice to Borrower's priority mailing list and in
all events not later than any public disclosure, written notice of any material
investments (other than in Cash Equivalents), material acquisitions, asset
purchases, dispositions, disposals, divestitures or similar transactions
involving Property, the raising of additional equity or the incurring or
repayment of material Debt, or any material merger, by or with Borrower or the
REIT, and, if requested by Administrative Agent after the consummation of such
transaction, a Compliance Certificate within 7 days after the date of such
request, in form and substance reasonably acceptable to Administrative Agent,
demonstrating in reasonable detail (which detail shall include actual
calculations and such supporting information as Administrative Agent may
reasonably require) compliance, after giving effect to such proposed
transaction(s), with the covenants contained in Section 7.3 and Article 8. For
purposes of this Section 5.1(s), any investment, acquisition, asset purchase,
disposition, disposal, divestiture, merger or similar transaction shall be
considered "material" if it involves assets exceeding five percent (5%) of
Borrower's assets (as existing prior to giving effect to such transaction) or if
it involves the acquisition or disposition of Real Property. Borrower's written
notice of each Real Property acquisition or disposition shall contain a
description of all improvements which are a part of such Real Property, the
square footage of such improvements, the acquisition or disposition price and
such other information with respect thereto reasonably requested by
Administrative Agent.
(t) Other Information. Such other information, reports,
contracts, schedules, lists, documents, agreements and instruments in the
possession of the REIT or Borrower with respect to (i) the Unencumbered Assets
or any other assets of the REIT or Borrower or any other Consolidated Entity
(either on an individual or an aggregate basis), (ii) any material change in the
REIT's investment, finance or operating policies, or (iii) the REIT's,
Borrower's or any other Consolidated Entity's business, condition (financial or
otherwise), operations, performance, properties or prospects as Administrative
Agent may from time to time reasonably request, including, without limitation,
annual information with respect to cash flow projections, budgets, operating
statements (current year and immediately preceding year), Rent Rolls, lease
expiration reports, leasing status reports, note payable summaries, bullet note
summaries, equity funding requirements, contingent liability summaries, line of
credit summaries, line of credit collateral summaries, wrap note or note
receivable summaries, schedules of outstanding letters of credit, summaries of
Cash and Cash Equivalents, projections of leasing fees and overhead budgets.
Provided that Administrative Agent gives Borrower reasonable prior notice and an
opportunity to participate, Borrower hereby authorizes Administrative Agent to
communicate with the Accountants and authorizes the Accountants to disclose to
Administrative Agent any and all financial statements and other information of
any kind, including copies of any management letter or the substance of any oral
information, that such accountants may have with respect to the Unencumbered
Assets or the REIT's, Borrower's or any Consolidated Entity's condition
(financial or otherwise), operations, properties, performance and prospects.
Concurrently therewith, Administrative Agent will notify Borrower of any such
communication and, at Administrative Agent's request, Borrower shall deliver a
letter addressed to the Accountants instructing them to disclose such
information in compliance with this Section 5.1(t).
(u) Press Releases; SEC Filings and Financial Statements.
Telephonic or telecopy notice to Administrative Agent concurrently with or prior
to issuance of any material press release concerning the REIT or Borrower and,
as soon as practicable after filing with the Commission, all reports and
notices, proxy statements, registration statements and prospectuses of the REIT.
All materials sent or made available generally by the REIT to the holders of its
publicly-held Securities or filed with the Commission, including all periodic
reports required to be filed with the Commission, shall be delivered by Borrower
or the REIT to Administrative Agent as soon as available.
(v) Accountant Reports. Copies of all reports prepared by the
Accountants and submitted to Borrower or the REIT in connection with each
annual, interim or special audit or review of the financial statements or
practices of Borrower or the REIT, including the comment letter submitted by the
Accountants in connection with their annual audit.
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(w) CMBS Entities Debt. Concurrently with the delivery of the
financial statements referred to in Section 5.1(c), a report in such reasonable
detail as Administrative Agent may require and certified as being true and
correct by the REIT's chief financial officer, chief accounting officer, chief
executive officer or chief operating officer, setting forth the Debt of each
CMBS Entity.
5.2 Environmental Notices. Borrower shall notify
Administrative Agent, in writing, as soon as practicable, and in any event
within ten (10) days after a Responsible Official of Borrower's or the REIT's
learning thereof, of any: (a) written notice or claim to the effect that the
REIT, Borrower or any Consolidated Entity is or may be liable to any Person as a
result of any material Release or threatened Release of any Contaminant into the
environment; (b) written notice that the REIT, Borrower or any Consolidated
Entity is subject to investigation by any Governmental Authority evaluating
whether any Remedial Action is needed to respond to the Release or threatened
Release of any Contaminant into the environment; (c) written notice that any
Property of the REIT, Borrower or any Consolidated Entity is subject to an
Environmental Lien; (d) written notice of violation of any Environmental Laws to
the REIT, Borrower or any Consolidated Entity or awareness of a condition which
might reasonably result in a notice of violation of any Environmental Laws by
the REIT, Borrower or any Consolidated Entity; (e) commencement or written
threat of any judicial or administrative proceeding alleging a violation of any
Environmental Laws; (f) written notice from a Governmental Authority of any
changes to any existing Environmental Laws that will have a Material Adverse
Effect on the operations of the REIT, Borrower or any Consolidated Entity; or
(g) any proposed acquisition of stock, assets, real estate or leasing of
property, or any other action by Borrower that, to the best of Borrower's
knowledge, could subject the REIT, Borrower or any Consolidated Entity to
environmental, health or safety Liabilities and Costs that will have a Material
Adverse Effect on the REIT, Borrower or any Consolidated Entity. With regard to
the matters referred to in clauses (a) through (e) above, the same shall apply
in respect of each Unencumbered Asset only if the matter will have a Material
Adverse Effect on such Unencumbered Asset and, in the case of other Real
Property of the REIT, Borrower or any Consolidated Entity, only if the matter
will have a Material Adverse Effect on the REIT, Borrower or such Consolidated
Entity.
5.3 Confidentiality. Confidential information obtained by
Administrative Agent or the Lenders pursuant to this Agreement or in connection
with the Advances shall not be disseminated by Administrative Agent or the
Lenders and shall not be disclosed to third parties except (a) to regulators,
taxing authorities and other Governmental Authorities having jurisdiction over
Administrative Agent or such Lender or otherwise in response to Requirements of
Law, (b) to their respective auditors and legal counsel and in connection with
regulatory, administrative and judicial proceedings as necessary or relevant,
including enforcement proceedings relating to the Loan Documents, and (c) to any
prospective assignee of or participant in a Lender's interest under this
Agreement or any prospective purchaser of the assets or a controlling interest
in any Lender, provided that such prospective assignee, participant or purchaser
first agrees to be bound by the provisions of this Section 5.3. In connection
with disclosures of confidential information to any non-governmental
third-party, Lender(s) from whom the same has been requested shall, to the
extent feasible and permitted, give prior notice of such request to Borrower;
however, neither Administrative Agent nor any such Lender shall incur any
liability to Borrower for failure to do so. For purposes hereof, "confidential
information" shall mean all nonpublic information obtained by Administrative
Agent or the Lenders, unless and until such information becomes publicly known,
other than as a result of unauthorized disclosure by Administrative Agent or the
Lenders of such information.
5.4 Annual Evidence of Insurance. Borrower shall provide
Administrative Agent with evidence, in form and substance reasonably acceptable
to Administrative Agent, of Borrower's maintenance of the insurance required by
Section 6.1(e) no later than June 15 of each year of the term of this Agreement.
ARTICLE 6
---------
AFFIRMATIVE COVENANTS
---------------------
Borrower covenants and agrees that, on and after the date
hereof, until payment in full of all of the Obligations, the expiration of the
Commitment and termination of this Agreement:
6.1 With Respect to Borrower:
(a) Existence. Borrower shall at all times maintain its
existence as a limited partnership and preserve and keep in full force and
effect its rights and franchises unless the failure to maintain such rights and
franchises does not have a Material Adverse Effect on Borrower.
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(b) Qualification, Name. Borrower shall qualify and remain
qualified to do business in each jurisdiction in which the nature of its
business requires it to be so qualified except for those jurisdictions where
failure to so qualify does not have a Material Adverse Effect on Borrower.
Borrower will transact business solely in its own name.
(c) Compliance with Laws, Etc. Borrower shall (i) comply with
all Requirements of Law, and all restrictive covenants affecting Borrower or the
Properties, performance, prospects, assets or operations of Borrower, and (ii)
obtain as needed all Permits necessary for its operations and maintain such in
good standing, except in each of the foregoing cases where the failure to do so
will not have a Material Adverse Effect on Borrower.
(d) Payment of Taxes and Claims. Borrower shall pay (i) all
taxes, assessments and other governmental charges imposed upon it or on any of
its properties or assets or in respect of any of its franchises, business,
income or Property before any penalty or interest accrues thereon, the failure
to make payment of which will have a Material Adverse Effect on Borrower, and
(ii) all claims (including, without limitation, claims for labor, services,
materials and supplies) for sums, material in the aggregate to Borrower, which
have become due and payable and which by law have or may become a Lien other
than a judgment lien upon any of Borrower's Properties or assets, prior to the
time when any penalty or fine shall be incurred with respect thereto.
Notwithstanding the foregoing, Borrower may contest by appropriate legal
proceedings conducted in good faith and with due diligence, the amount, validity
or application, in whole or in part, of any taxes, assessments, other
governmental charges or claims described above, provided that Borrower shall
provide such security as may be reasonably required by Administrative Agent to
insure ultimate payment of the same and to prevent any sale or forfeiture of any
of Borrower's Property (or any portion thereof or interest therein), provided
however, that the provisions of this Section 6.1(d) shall not be construed to
permit Borrower to contest the payment of any Obligations or any other sums
payable by Borrower to Administrative Agent or the Lenders hereunder or under
any other Loan Document. Notwithstanding any of the foregoing, Borrower shall
indemnify, defend and save Administrative Agent and the Lenders harmless from
and against any liability, cost or expense of any kind that may be imposed on
Administrative Agent or the Lenders in connection with any such contest and any
loss resulting therefrom.
(e) Maintenance of Properties; Insurance. Borrower shall
maintain in good repair, working order and condition, excepting ordinary wear
and tear, all of its Property and will make or cause to be made all appropriate
repairs, renewals and replacements thereof. Borrower shall maintain (i)
insurance with responsible companies in such amounts and against such risks as
is usually carried by companies engaged in similar businesses and owning similar
properties in the same general areas in which Borrower operates, (ii) insurance
required by any Governmental Authority having jurisdiction over Borrower, and
(iii) all other insurance reasonably required by Administrative Agent from time
to time. Neither Borrower nor any other Consolidated Entity shall assign or
otherwise transfer, or grant a security interest in, any casualty insurance
carried by it or in the proceeds of such insurance in a manner which is
disproportionate to the value of all of the Real Property insured by Borrower or
such Consolidated Entity.
(f) Inspection of Property; Books and Records; Discussion.
Borrower shall permit, and shall cause the REIT to permit, any authorized
representatives designated by any Lender to visit and inspect any of its
Properties (subject to rights of tenants), including all Unencumbered Assets,
upon reasonable prior notice, to inspect financial and accounting records and
leases, and to make copies and take extracts therefrom, all at such times during
normal business hours and as often as any Lender may reasonably request;
provided that all such visits and inspections shall be coordinated through
Administrative Agent and provided that Administrative Agent shall give
reasonable prior notice to Borrower of all such visits and inspections. In
connection therewith, Borrower shall pay all expenses required by Section 11.1.
Borrower will keep proper books of record and account in which entries, in
conformity with GAAP and as otherwise required by this Agreement and applicable
Requirements of Law, shall be made of all dealings and transactions in relation
to its businesses and activities and as otherwise required under Section 5.1.
(g) Maintenance of Permits, Etc. Borrower will maintain in
full force and effect all Permits, franchises, patents, trademarks, trade names,
copyrights, authorizations or other rights necessary for the operation of its
business, except where the failure to obtain any of the foregoing would not have
a Material Adverse Effect on Borrower; and notify Administrative Agent in
writing, promptly after learning thereof, of the suspension, cancellation,
revocation or discontinuance of, or of any pending or threatened action or
proceeding seeking to suspend, cancel, revoke or discontinue, any material
Permit, patent, trademark, trade name, copyright, governmental approval,
franchise authorization or right.
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(h) Conduct of Business. Except for Investments expressly
permitted pursuant to Section 8.8 and investments in Cash and Cash Equivalents,
Borrower shall engage only in the business of acquiring, developing, owning,
operating and managing income producing Office Properties within the continental
United States and any business activities and investments of Borrower incidental
thereto.
(i) Use of Proceeds. Borrower shall use the proceeds of the
Advances only for pre-developments costs, development costs, acquisition costs,
capital improvements, working capital, equity investments, repayment of other
Indebtedness, including required interest and/or principal payments thereon, and
for any other general corporate purposes, including distributions permitted
hereunder.
(j) Ratings. Borrower shall obtain and maintain a rating of
its long-term senior unsecured Debt by each of Standard & Poor's and Moody's
Investors Service, Inc.
(k) Delivery of Rating Notices and Notices of Lowering or Loss
of Rating. Borrower shall deliver a Rating Notice to Administrative Agent within
three (3) Business Days after Borrower receives notice of each change in the
rating of Borrower's long-term unsecured senior Debt by Standard & Poor's or
Moody's Investors Service, Inc. to a rating of not lower than BBB-. Borrower
also shall deliver notice to Administrative Agent within three (3) Business Days
after Borrower receives notice that either (i) the rating of its long-term
unsecured senior Debt has been lowered to less than BBB- or (ii) its long-term
unsecured senior Debt no longer will be rated by Standard & Poor's or Moody's
Investors Service, Inc.
(l) Delivery of Contribution Agreements. Borrower shall
deliver any Contribution Agreements executed after the date of this Agreement
within fifteen (15) Business Days after such Contribution Agreement has been
fully executed by each party thereto.
6.2 With Respect to the REIT:
(a) Corporate Existence. The REIT shall at all times maintain
its corporate existence and preserve and keep in full force and effect its
rights and franchises unless the failure to maintain such rights and franchises
will not have a Material Adverse Effect on the REIT.
(b) Qualification, Name. The REIT shall qualify and remain
qualified to do business in each jurisdiction in which the nature of its
business requires it to be so qualified except for those jurisdictions where
failure to so qualify does not have a Material Adverse Effect on the REIT. The
REIT will transact business solely in its own name.
(c) Securities Law Compliance. The REIT shall comply in all
material respects with all rules and regulations of the Commission and file all
reports required by the Commission relating to the REIT's publicly-held
Securities.
(d) Continued Status as a REIT; Prohibited Transactions. The
REIT (i) will continue to be a real estate investment trust as defined in
Section 856 of the Code (or any successor provision thereto), (ii) will not
revoke its election to be a real estate investment trust, (iii) will not engage
in any "prohibited transactions" as defined in Section 857(b)(6)(iii) of the
Code (or any successor provision thereto), and (iv) will continue to be entitled
to a dividend paid deduction meeting the requirements of Section 857 of the
Code.
(e) NYSE Listed Company. The common stock of the REIT shall at
all times be listed for trading on the New York Stock Exchange.
(f) Compliance with Laws, Etc. The REIT shall (i) comply with
all Requirements of Law and restrictive covenants affecting the REIT and (ii)
obtain as needed all Permits necessary for its operations and maintain such in
good standing, except in each of the foregoing cases where the failure to do so
will not have a Material Adverse Effect on the REIT.
(g) Payment of Taxes and Claims. The REIT shall pay (i) all
taxes, assessments and other governmental charges imposed upon it or on any of
its properties or assets or in respect of any of its franchises, business,
income or Property before any penalty or interest accrues thereon, the failure
to make payment of which will have a Material Adverse Effect on the REIT, and
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(ii) all claims (including, without limitation, claims for labor, services,
materials and supplies) for sums, material in the aggregate to the REIT, which
have become due and payable and which by law have or may become a Lien other
than a judgment lien upon any of the REIT's Properties or assets, prior to the
time when any penalty or fine shall be incurred with respect thereto.
Notwithstanding the foregoing, the REIT may contest by appropriate legal
proceedings conducted in good faith and with due diligence, the amount, validity
or application, in whole or in part, of any taxes, assessments, other
governmental charges or claims described above, provided that the REIT shall
provide such security as may be required by Administrative Agent to insure
ultimate payment of the same and to prevent any sale or forfeiture of any of the
REIT's Property (or any portion thereof or interest therein), provided, however,
that the provisions of this Section 6.2(g) shall not be construed to permit the
REIT to contest the payment of any obligations owed to Administrative Agent or
the Lenders or any other sums payable by the REIT to Administrative Agent or the
Lenders hereunder or under any other Loan Document. Notwithstanding any of the
foregoing, the REIT shall indemnify, defend and save Administrative Agent and
the Lenders harmless from and against any liability, cost or expense of any kind
that may be imposed on Administrative Agent or the Lenders in connection with
any such contest and any loss resulting therefrom.
(h) Net Offering Proceeds. Unless otherwise agreed in writing
by Requisite Lenders, the REIT shall immediately contribute any Net Offering
Proceeds to Borrower.
ARTICLE 7
---------
NEGATIVE COVENANTS
------------------
Borrower covenants and agrees that, on and after the date
hereof, until payment in full of all of the Obligations, the expiration of the
Commitment and termination of this Agreement:
7.1 With Respect to all Parties. Neither Borrower nor the REIT
shall:
(a) Restrictions on Fundamental Changes. (i) The REIT and the
Consolidated Entities shall not enter into any merger, consolidation or
reorganization or any sale of all or a substantial portion of the assets of the
REIT and the Consolidated Entities, taken as a whole, or liquidate, wind up or
dissolve, except that (1) any Person engaged in the development and operation of
class A suburban Office Properties may merge or consolidate with and into the
REIT, Borrower or any other Consolidated Entity, provided (A) no Event of
Default or event which, with the giving of notice or the passage of time or
both, could become an Event of Default, then exists or would result therefrom,
(B) the REIT, Borrower or such Consolidated Entity, as the case may be, is the
surviving entity, (C) the Requisite Lenders reasonably determine that such
merger or consolidation will not have a Material Adverse Effect on Borrower or
the REIT and (D) Borrower delivers to Administrative Agent, prior to the REIT,
Borrower or such Consolidated Entity becoming obligated (conditionally or
otherwise) to proceed with such transaction, a certificate, in form and
substance and in such detail as Administrative Agent may reasonably require, of
the REIT's chief financial officer, chief executive officer or chief operating
officer demonstrating compliance with this Agreement on a proforma basis giving
effect to such transaction, and (2) Borrower and the REIT may acquire interests
in the CMBS Entities and Borrower may contribute assets to such CMBS Entities;
(ii) Change its Fiscal Year; or
(iii) Engage in any line of business other than as
expressly permitted under Section 6.1(h).
(b) ERISA. Permit any ERISA Affiliates to do any of the
following to the extent that such act or failure to act would result in the
aggregate, after taking into account any other such acts or failure to act, in a
Material Adverse Effect on Borrower or the REIT:
(i) Engage, or knowingly permit an ERISA Affiliate to
engage, in any prohibited transaction described in Section 406 of ERISA
or Section 4975 of the Code which is not exempt under Section 407 or
408 of ERISA or Section 4975(d) of the Code for which a class exemption
is not available or a private exemption has not been previously
obtained from the DOL;
(ii) Permit to exist any accumulated funding
deficiency (as defined in Section 302 of ERISA and Section 412 of the
Code), whether or not waived;
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(iii) Fail, or permit an ERISA Affiliate to fail, to
pay timely required contributions or annual installments due with
respect to any waived funding deficiency to any Plan if such failure
could result in the imposition of a Lien or otherwise would have a
Material Adverse Effect on Borrower or the REIT;
(iv) Terminate, or permit an ERISA Affiliate to
terminate, any Benefit Plan which would result in any liability of
Borrower or an ERISA Affiliate under Title IV of ERISA or the REIT; or
(v) Fail, or permit any ERISA Affiliate to fail, to
pay any required installment under section (m) of Section 412 of the
Code or any other payment required under Section 412 of the Code on or
before the due date for such installment or other payment, if such
failure could result in the imposition of a Lien or otherwise would
have a Material Adverse Effect on Borrower or the REIT.
(c) Debt and Guaranty Obligations. Create, incur or assume any
Debt or Guaranty Obligations except:
(i) subject to Section 8.9, below, Debt which is
secured by Real Property;
(ii) the City National Bank Loan;
(iii) Debt and Guaranty Obligations under the
Second Amended and Restated Credit Agreement and the documents entered
into in connection therewith;
(iv) Guaranty Obligations which do not, in the
aggregate, exceed Five Hundred Thousand Dollars ($500,000);
(v) publicly-issued Indebtedness or privately-
placed unsecured fixed rate term Debt;
(vi) the Contribution Agreement;
(vii) the demand promissory note of the REIT to
Arden Realty Finance, Inc., in the principal amount $28,709,393; or
(viii) Debt of the REIT permitted under Section
7.7(b).
7.2 Amendment of Constituent Documents. Borrower shall not
materially amend its partnership agreement or certificate of limited partnership
without the prior written consent of the Requisite Lenders, except as may be
required by applicable law or to comply with Section 6.2(d). The REIT shall not
materially amend its articles of incorporation or by-laws without the prior
written consent of the Requisite Lenders, except (i) as required by applicable
law or (ii) as may be required to comply with Section 6.2(d).
7.3 REIT Directors. In no event during any twelve consecutive
month period during the term of this Agreement shall the individuals who were
directors of the REIT at the beginning of such period cease to constitute a
majority of the board of directors of the REIT unless the individuals replacing
such original directors were nominated by the board of directors of the REIT.
7.4 Management. Richard Ziman shall not cease to be active on
a full-time, continuing basis in the senior management of Borrower and the REIT;
provided, however, that, if due to death or incapacity, Richard Ziman is unable
to act in such capacity, Borrower shall have one hundred twenty (120) days to
obtain the approval of the Requisite Lenders with respect to the new management.
In the event Borrower shall fail to obtain approval of the Requisite Lenders
within such 120-day period, then Borrower shall, at the election and upon the
demand of the Requisite Lenders pay in full all Obligations under the Loan
Documents not later than sixty (60) days after the end of such 120-day period,
whereupon this Agreement and the Commitment shall be terminated. No further
Advances shall be permitted until Borrower shall have obtained approval of the
Requisite Lenders under this Section 7.4.
7.5 Margin Regulations. No portion of the proceeds of any
Advances shall be used in any manner which might cause the extension of credit
or the application of such proceeds to violate Regulation T, U or X or any other
regulation of the Federal Reserve Board or to violate the Securities Exchange
Act or the Securities Act, in each case as in effect on the applicable Funding
Date.
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7.6 Organization of Borrower, Etc. Borrower shall remain a
Maryland limited partnership with the REIT as its sole general partner. At no
time shall Borrower be taxed as an association under the Internal Revenue Code.
7.7 With Respect to the REIT:
(a) The REIT shall not own any material assets or engage in
any line of business other than the ownership of the partnership interests
described in Section 4.2(o) and as otherwise permitted under Section 7.1(a) and
Section 8.8.
(b) The REIT shall not directly or indirectly create, incur,
assume or otherwise become or remain directly or indirectly liable with respect
to, any Debt, except the obligations and other Indebtedness of Borrower,
Indebtedness constituting obligations of its Consolidated Entities or
Unconsolidated Joint Ventures, and obligations under the Guaranty.
(c) The REIT shall not directly or indirectly create, incur,
assume or permit to exist any Lien on or with respect to any of its Property or
assets except Liens in favor of Administrative Agent securing the Obligations.
(d) The REIT will not directly or indirectly convey, sell,
transfer, assign, pledge or otherwise encumber or dispose of any of its
partnership interests in Borrower held as of the Closing Date, except to secure
the Obligations.
ARTICLE 8
---------
FINANCIAL COVENANTS
-------------------
Borrower covenants and agrees that, on and after the date of
this Agreement and until payment in full of all the Obligations, the expiration
of the Commitment and the termination of this Agreement:
8.1 Tangible Net Worth. The Tangible Net Worth of the REIT and
the Consolidated Entities, as of the last day of each Fiscal Quarter, shall not
be less than the sum of (i) $294,988,000, plus (ii) 90% of the cumulative net
cash proceeds received from and the value of assets acquired (net of the
Indebtedness incurred or assumed in connection therewith) through the issuance
of Capital Stock of the REIT and Partnership Units of the Borrower after the
"Closing Date" (as defined in the 1996 Credit Agreement) other than issuance of
Capital Stock in exchange for Partnership Units, minus (iii) the aggregate cost
to the REIT of repurchasing its publicly traded common stock; provided, however,
that, after any such repurchase, in no event shall the Tangible Net Worth of the
REIT and the Consolidated Entities be less than $1,500,000,000. For the purposes
of clause (ii), "net" means net of underwriters' discounts, commissions and
other reasonable out-of-pocket expenses of the transaction actually paid to any
Person (other than Borrower or any Affiliate of Borrower).
8.2 Maximum Total Liabilities to Gross Asset Value. The ratio
of Total Liabilities to Gross Asset Value shall not exceed 55% at any time.
8.3 Minimum Interest Coverage Ratio. As of the last day of any
Fiscal Quarter, the Interest Coverage Ratio shall not be less than 2.00:1.
8.4 Minimum Fixed Charge Coverage Ratio. As of the last day of
any Fiscal Quarter, the Fixed Charge Coverage Ratio shall not be less than
1.75:1.
8.5 Minimum Unencumbered Pool. The aggregate Unencumbered
Asset Value of the Unencumbered Pool shall not, at any time, be less than 175%
of the unsecured Total Liabilities of the REIT and the Consolidated Entities.
8.6 Minimum Unsecured Interest Expense Coverage. As of the
last day of any Fiscal Quarter, the Unsecured Interest Expense Coverage Ratio of
the REIT and the Consolidated Entities shall not be less than 1.80:1.
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8.7 Distributions. (a) Subject to subsection (b) below,
aggregate distributions to shareholders of the REIT and all partners of Borrower
shall not exceed, for any four (4) consecutive Fiscal Quarters, ninety-five
percent (95%) of Funds from Operations. For purposes of this Section 8.7, the
term "distributions" shall mean all dividends and other distributions to, and
the repurchase of stock or limited partnership interests from, the holder of any
equity interests in Borrower or the REIT (other than the redemption of limited
partnership interests in Borrower in exchange for REIT stock).
(b) Aggregate distributions during the continuance of any
Event of Default shall not exceed the lesser of (i) the aggregate amount
permitted to be made during the continuance thereof under subsection (a) above,
and (ii) the minimum amount that the REIT must distribute to its shareholders in
order to avoid federal tax liability and to remain qualified as a real estate
investment trust as defined in Section 856 of the Code.
8.8 Investments; Asset Mix. (a) The REIT shall not at any time
make or own any Investment in any Person, or purchase, lease or own any other
asset or property, except (i) any Investment in Borrower, (ii) any Investment in
the CMBS Entities, (iii) any Capital Stock in the Consolidated Entities (other
than Borrower), and (iv) any cash or other property that is being distributed to
the shareholders of the REIT substantially contemporaneously with the REIT's
receipt of such cash or other property.
(b) Except as permitted under Section 7.1(a), Borrower shall
not at any time make or own any Investment in any Person, or purchase, lease or
own any Real Property or other asset, except that Borrower may own or lease the
following, subject to the limitations set forth below:
<TABLE>
<CAPTION>
Limitation on Value
for Each Asset Type
Asset Type at the Time of Determination
---------- ----------------------------
<S> <C> <C>
1. Wholly-Owned Office Property and related Property Unlimited
2. Wholly-Owned Land 5% of Gross Asset Value
3. Wholly-Owned Real Property (other than Office 10% of Gross Asset Value
Properties or Land referred to in clause 2)
4. Wholly-owned Capital Stock of corporations 10% of Gross Asset Value
5. Investment Mortgages 15% of Gross Asset Value
6. Wholly-owned Capital Stock of Joint Ventures 15% of Gross Asset Value
(other than corporations)
7. Construction in Progress (exclusive of tenant 12.5% of all Office Properties
improvements) (based on the total gross leasable area,
measured in square feet)(provided that
this category shall not, with respect
to any construction in progress(for any
Office Property)which is not at least
70% pre-leased and with all Major
Agreements previously approved by
Administrative Agent, exceed 7% of the
total gross leasable area, measured in
square feet, of all Office Properties)
</TABLE>
Notwithstanding the foregoing, Investments and other assets in
the foregoing categories 2 through 6 may not, in the aggregate exceed, at any
time, 25% of Gross Asset Value. All values of Investments and other assets shall
be the original cost of such Investments and assets, except as otherwise
expressly provided.
8.9 Secured Debt. The aggregate amount of all Debt of the REIT
and the Consolidated Entities secured by Real Property shall not, at any time,
exceed 35% of Gross Asset Value.
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ARTICLE 9
---------
EVENTS OF DEFAULT; RIGHTS AND REMEDIES
--------------------------------------
9.1 Events of Default. Each of the following occurrences shall
constitute an Event of Default under this Agreement:
(a) Failure to Make Payments When Due. Borrower shall fail to
pay (i) any amount due on the Maturity Date, (ii) any principal when due, or
(iii) any interest on any Advance, or any fee or other amount payable under any
Loan Documents, within three (3) days after the same becomes due.
(b) Distributions. Borrower or the REIT shall breach any
covenant set forth in Section 6.2(d) or 8.7.
(c) Breach of Financial Covenants. Borrower shall (i) fail to
satisfy any financial covenant set forth in Article 8 other than the financial
covenants set forth in Sections 8.3, 8.4 and 8.6, and such failure shall
continue for thirty (30) days, or (ii) fail to satisfy any of the financial
covenants set forth in Sections 8.3, 8.4 or 8.6 (as to which there shall be no
cure period).
(d) Other Defaults. The REIT or Borrower shall fail duly and
punctually to perform or observe any agreement, covenant or obligation binding
on Borrower or the REIT under this Agreement or under any of the other Loan
Documents (other than as described in any other provision of this Section 9.1),
and such failure shall continue for thirty (30) days after Borrower or the REIT
knew of such failure (or such lesser period of time as is mandated by applicable
Requirements of Law).
(e) Breach of Representation or Warranty. Any representation
or warranty made or deemed made by Borrower or the REIT to Administrative Agent
or any Lender herein or in any of the other Loan Documents or in any statement,
certificate or financial statements at any time given by Borrower pursuant to
any of the Loan Documents shall be false or misleading in any material respect
on the date as of which made.
(f) Default as to Other Debt. Borrower or the REIT or any
other Consolidated Entity shall have defaulted (beyond any applicable grace
period) under any Debt of such party (other than the Obligations) if the
aggregate amount of such other Debt is One Million Dollars ($1,000,000) or more
and such default shall not have been cured or waived; provided, however, that
the foregoing $1,000,000 limitation shall be increased to Ten Million Dollars
($10,000,000) in the case of Nonrecourse Debt.
(g) Involuntary Bankruptcy; Appointment of Receiver, etc. (i)
An involuntary case shall be commenced against the REIT or Borrower or any other
Consolidated Entity and the petition shall not be dismissed within sixty (60)
days after commencement of the case, or a court having jurisdiction shall enter
a decree or order for relief in respect of any such Person in an involuntary
case, under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect; or any other similar relief shall be granted under any
applicable federal, state or foreign law; or
(ii) A decree or order of a court having jurisdiction
for the appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over the REIT or
Borrower or any other Consolidated Entity, or over all or a substantial
part of the property of any such Person, shall be entered; or an
interim receiver, trustee or other custodian of any such Person or of
all or a substantial part of the property of any such Person shall be
appointed; or a warrant of attachment, execution or similar process
against any substantial part of the property of any such Person shall
be issued; and any such event shall not be stayed, vacated, dismissed,
bonded or discharged within sixty (60) days of entry, appointment or
issuance.
(h) Voluntary Bankruptcy; Appointment of Receiver, Etc. The
REIT or Borrower or any other Consolidated Entity shall have an order for relief
entered with respect to it, or commence a voluntary case under, any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or shall
consent to the entry of an order for relief in an involuntary case, or to the
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conversion of an involuntary case to a voluntary case, under any such law, or
shall consent to the appointment of or taking of possession by a receiver,
trustee or other custodian for all or a substantial part of its property; any
such Person shall make any assignment for the benefit of creditors or shall be
unable or fail, or admit in writing its inability, to pay its debts as such
debts become due; or the general partner of Borrower or any other Consolidated
Entity or the REIT's Board of Directors (or any committee thereof) adopts any
resolution or otherwise authorizes any action to approve any of the foregoing.
(i) Judgments and Attachments. (i) Any money judgment (other
than a money judgment covered by insurance but only if the insurer has admitted
liability with respect to such money judgment), writ or warrant of attachment,
or similar process involving in any case an amount in excess of One Million
Dollars ($1,000,000) shall be entered or filed against the REIT, Borrower, any
other Consolidated Entity or their respective assets and shall remain
undischarged, unvacated, unbonded or unstayed for a period of thirty (30) days,
or (ii) any judgment or order of any court or administrative agency awarding
material damages shall be entered against any such Person in any action under
the Federal securities laws seeking rescission of the purchase or sale of, or
for damages arising from the purchase or sale of, any Securities, such judgment
or order shall have become final after exhaustion of all available appellate
remedies and, in Administrative Agent's judgment, the payment of such judgment
or order would have a Material Adverse Effect on such Person.
(j) Dissolution. Any order, judgment or decree shall be
entered against the REIT, Borrower or any other Consolidated Entity decreeing
its involuntary dissolution or split up and such order shall remain undischarged
and unstayed for a period in excess of thirty (30) days; or the REIT, Borrower
or any other Consolidated Entity shall otherwise dissolve or cease to exist.
(k) Loan Documents. If for any reason any Loan Document shall
cease to be in full force and effect and such condition or event shall continue
for fifteen (15) days after Borrower or the REIT knew of such condition or
event.
(l) ERISA Liabilities. Any Termination Event occurs which will
or is reasonably likely to subject Borrower or the REIT or any ERISA Affiliate
of any of them to a liability which Administrative Agent reasonably determines
will have a Material Adverse Effect on Borrower or the REIT, or the plan
administrator of any Benefit Plan applies for approval under Section 412(d) of
the Internal Revenue Code for a waiver of the minimum funding standards of
Section 412(a) of the Internal Revenue Code and Administrative Agent reasonably
determines that the business hardship upon which the Section 412(d) waiver was
based will or would reasonably be anticipated to subject Borrower or the REIT to
a liability which Administrative Agent determines will have a Material Adverse
Effect on Borrower or the REIT.
(m) Environmental Liabilities. Borrower or the REIT becomes
subject to any Liabilities and Costs which Administrative Agent reasonably deems
to have a Material Adverse Effect on such Person arising out of or related to
(i) the Release or threatened Release at any Property of any Contaminant into
the environment, or any Remedial Action in response thereto, or (ii) any
violation of any Environmental Laws.
(n) Solvency. Borrower or the REIT shall cease to be Solvent.
(o) Breach of Guaranty. The REIT shall fail to duly and
punctually perform or observe any agreement, covenant or obligation under its
Guaranty.
(p) Sole General Partner. The REIT shall cease to be the sole
general partner of Borrower or cease to own 51%
or more of the Partnership Units of Borrower.
(q) CMBS Entities Debt. Any CMBS Entity creates, incurs or
assumes any Debt in excess of the principal amount of such CMBS Entity's Debt as
of the Closing Date.
An Event of Default shall be deemed "continuing" until cured
or waived in writing in accordance with Section 11.4.
9.2 Rights and Remedies.
(a) Acceleration, Etc. Upon the occurrence of any Event of
Default described in the foregoing Section 9.1(g) or 9.1(h) with respect to the
REIT or Borrower or any other Consolidated Entity, the Commitment shall
automatically and immediately terminate and the unpaid principal amount of and
any and all accrued interest on the Advances and all of the other Obligations
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shall automatically become immediately due and payable, with all additional
interest, fees, costs and expenses from time to time accrued thereon and/or
payable hereunder, and without presentment, demand or protest or other
requirements of any kind (including, without limitation, valuation and
appraisement, diligence, presentment, notice of intent to demand or accelerate
or notice of acceleration), all of which are hereby expressly waived by
Borrower, and the obligations of the Lenders to make any Advances hereunder
shall thereupon terminate; and upon the occurrence and during the continuance of
any other Event of Default, Administrative Agent shall, at the request, or may,
with the consent of Requisite Lenders, by written notice to Borrower, (i)
declare that the Commitment is terminated, whereupon the Commitment and the
obligation of the Lenders to make any Advance hereunder shall immediately
terminate, and/or (ii) declare the unpaid principal amount of, any and all
accrued and unpaid interest on the Advances and all of the other Obligations to
be, and the same shall thereupon be, immediately due and payable with all
additional interest from time to time accrued thereon and without presentment,
demand, or protest or other requirements of any kind (including without
limitation, valuation and appraisement, diligence, presentment, notice of intent
to demand or accelerate and of acceleration), all of which are hereby expressly
waived by Borrower. Without limiting Administrative Agent's authority hereunder,
on or after the Maturity Date, Administrative Agent shall, at the request, or
may, with the consent, of Requisite Lenders exercise any or all rights and
remedies under the Loan Documents or applicable law or in equity.
(b) Access to Information. If an Event of Default then exists,
Administrative Agent shall have, in addition to and not by way of a limitation
on any other rights and remedies contained in this Agreement or in the other
Loan Documents, the right within forty-eight (48) hours after notice to Borrower
to obtain access to Borrower's and the REIT's records (including computerized
information, files and supporting software) relating to the Unencumbered Assets,
and its accounting information relating to the Unencumbered Assets, and to use
all of the foregoing and the information contained therein in any manner
Administrative Agent deems appropriate which is related to the collection of the
Obligations. Borrower hereby irrevocably authorizes any accountant or management
agent employed by Borrower to deliver such items and information to
Administrative Agent. Notwithstanding anything to the contrary contained in the
Loan Documents, upon the occurrence of and during the continuance of an Event of
Default, Administrative Agent shall be entitled to request and receive, by or
through Borrower or appropriate legal process, any and all information
concerning the REIT, Borrower, or any Property of either of them, which is
reasonably available to or obtainable by Borrower. Administrative Agent shall
deliver to each Lender copies of any information which it obtains pursuant to
this Section 9.2(b).
(c) Waiver of Demand. Demand, presentment, protest and notice
of nonpayment are hereby waived by Borrower. Borrower also waives, to the extent
permitted by law, the benefit of all valuation, appraisal and exemption laws.
(d) Waivers, Amendments and Remedies. No delay or omission of
Administrative Agent or the Lenders to exercise any right under any Loan
Document shall impair such right or be construed to be a waiver of any Event of
Default or an acquiescence therein, and any single or partial exercise of any
such right shall not preclude other or further exercise thereof or the exercise
of any other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in a writing signed by Administrative Agent after obtaining written approval
thereof or the signature thereon of those Lenders required to approve such
waiver, amendment or other variation, and then only to the extent in such
writing specifically set forth. All remedies contained in the Loan Documents or
by law afforded shall be cumulative and all shall be available to Administrative
Agent and the Lenders until the Obligations have been paid in full, the
Commitment has expired or terminated and this Agreement has been terminated.
9.3 Rescission. If, at any time after acceleration of the
maturity of the Advances, Borrower shall pay all arrears of interest and all
payments on account of principal of the Advances which shall have become due
otherwise than by acceleration (with interest on principal and, to the extent
permitted by law, on overdue interest, at the rates specified in this Agreement)
and all Events of Default and Unmatured Events of Default (other than nonpayment
of principal of and accrued interest on the Advances due and payable solely by
virtue of acceleration) shall be remedied or waived pursuant to Section 11.4,
then by written notice to Borrower, the Requisite Lenders may elect, in their
sole discretion, to rescind and annul the acceleration and its consequences; but
such action shall not affect any subsequent Event of Default or Unmatured Event
of Default or impair any right or remedy consequent thereon. The provisions of
the preceding sentence are intended merely to bind the Lenders to a decision
which may be made at the election of the Requisite Lenders; they are not
intended to benefit Borrower and do not give Borrower the right to require the
Lenders to rescind or annul any acceleration hereunder, even if the conditions
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set forth herein are met. Borrower shall have no right to enforce this Section
9.3, or to make any claim hereunder, directly, or as a third party beneficiary,
or otherwise.
ARTICLE 10
----------
AGENCY PROVISIONS
-----------------
10.1 Appointment. (a) Each Lender hereby (i) designates and
appoints LCPI as Administrative Agent of such Lender under this Agreement and
the other Loan Documents, (ii) authorizes and directs Administrative Agent to
enter into the Loan Documents other than this Agreement for the benefit of the
Lenders, and (iii) authorizes Administrative Agent to take such action on its
behalf under the provisions of this Agreement and the other Loan Documents and
to exercise such powers as are set forth herein or therein, together with such
other powers as are reasonably incidental thereto, subject to the limitations
referred to in Sections 10.10(a) and 10.10(b) and the other provisions of this
Agreement requiring consent or approval of all the Lenders or the Requisite
Lenders. Administrative Agent agrees to act as such on the express conditions
contained in this Article 10.
(b) The provisions of this Article 10 are solely for the
benefit of Administrative Agent and the Lenders, and Borrower shall not have any
right to rely on or enforce any of the provisions hereof (provided that Borrower
may rely on the provisions of Section 10.4(b) and Section 10.9); provided,
however, the foregoing shall in no way limit Borrower's obligations under this
Article 10. In performing its functions and duties under this Agreement,
Administrative Agent shall act solely as Administrative Agent of the Lenders and
does not assume and shall not be deemed to have assumed any obligation toward or
relationship of agency or trust with or for Borrower or any other Person.
10.2 Nature of Duties. Administrative Agent shall not have any
duties or responsibilities except those expressly set forth in this Agreement or
in the other Loan Documents. The duties of Administrative Agent shall be
administrative in nature. Subject to the provisions of Sections 10.5 and 10.7,
Administrative Agent shall administer the Advances in the same manner as it
administers its own loans. Promptly following the effectiveness of this
Agreement, Administrative Agent shall send to each Lender its originally
executed Note and the executed original, to the extent the same are available in
sufficient numbers, of each other Loan Document other than the Notes in favor of
the other Lenders and filed or recorded security documents or instruments, with
the latter to be held and retained by Administrative Agent for the benefit of
all the Lenders. Administrative Agent shall not have by reason of this Agreement
a fiduciary relationship in respect of any Lender. Nothing in this Agreement or
any of the other Loan Documents, expressed or implied, is intended or shall be
construed to impose upon Administrative Agent any obligation in respect of this
Agreement or any of the other Loan Documents except as expressly set forth
herein or therein. Each Lender shall make its own independent investigation of
the financial condition and affairs of the REIT and Borrower in connection with
the making and the continuance of the Advances hereunder and shall make its own
appraisal of the creditworthiness of the REIT and Borrower, and, except as
specifically provided herein, Administrative Agent shall not have any duty or
responsibility, either initially or on a continuing basis, to provide any Lender
with any credit or other information with respect thereto, whether coming into
its possession before the Closing Date or at any time or times thereafter.
10.3 Disbursements of Advances. (a) Promptly, but in any event
not later than 5:00 p.m. (New York City time) on the same Business Day on which
Administrative Agent receives a Notice of Borrowing, Administrative Agent shall
send a copy thereof by facsimile to each other Lender and shall otherwise notify
each Lender of the proposed Advance and the Funding Date. Each Lender shall make
available to Administrative Agent (or the funding bank or entity designated by
Administrative Agent), the amount of such Lender's Pro Rata Share of such
Advance in immediately available funds not later than the times designated in
Section 10.3(b). Unless Administrative Agent shall have been notified by any
Lender not later than the close of business (New York City time) on the Business
Day immediately preceding the Funding Date in respect of any Advance that such
Lender does not intend to make available to Administrative Agent such Lender's
Pro Rata Share of such Advance, Administrative Agent may assume that such Lender
shall make such amount available to Administrative Agent. If any Lender does not
notify Administrative Agent of its intention not to make available its Pro Rata
Share of such Advance as described above, but does not for any reason make
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available to Administrative Agent such Lender's Pro Rata Share of such Advance,
such Lender shall pay to Administrative Agent forthwith on demand such amount,
together with interest thereon at the Federal Funds Rate. In any case where a
Lender does not for any reason make available to Administrative Agent such
Lender's Pro Rata Share of such Advance, Administrative Agent, in its sole
discretion, may, but shall not be obligated to, fund to Borrower such Lender's
Pro Rata Share of such Advance. If Administrative Agent funds to Borrower such
Lender's Pro Rata Share of such Advance and if such Lender subsequently pays to
Administrative Agent such corresponding amount, such amount so paid shall
constitute such Lender's Pro Rata Share of such Advance. Nothing in this Section
10.3(a) shall alter the respective rights and obligations of the parties
hereunder in respect of a Defaulting Lender or a Non-Pro Rata Advance. 10.1
(b) Requests by Administrative Agent for funding by the
Lenders of Advances will be made by telecopy. Each Lender shall make the amount
of its Advance available to Administrative Agent in Dollars and in immediately
available funds, to such bank and account, in New York City, New York as
Administrative Agent may designate, not later than 9:00 A.M. (New York City
time) on the Funding Date designated in the Notice of Borrowing with respect to
such Advance, but in no event earlier than two (2) Business Days following such
Lender's receipt of the applicable Notice of Borrowing.
(c) Nothing in this Section 10.3 shall be deemed to relieve
any Lender of its obligation hereunder to make its Pro Rata Share of any Advance
on the applicable 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 Pro Rata Share 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 an Advance.
10.4 Distribution and Apportionment of Payments. (a) Subject
to Section 10.4(b), payments actually received by Administrative Agent for the
account of the Lenders shall be paid to them promptly after receipt thereof by
Administrative Agent, but in any event within one (1) Business Day, provided
that Administrative Agent shall pay to the Lenders interest thereon, at the
Federal Funds Rate, from the Business Day following receipt of such funds by
Administrative Agent until such funds are paid in immediately available funds to
the Lenders. Subject to Section 10.4(b), all payments of principal and interest
in respect of outstanding Advances, all payments of the fees described in this
Agreement, and all payments in respect of any other Obligations shall be
allocated among such Lenders as are entitled thereto, in proportion to their
respective Pro Rata Shares or otherwise as provided herein. Administrative Agent
shall promptly distribute, but in any event within one (1) Business Day after it
receives the same, to each Lender at its primary address set forth on the
appropriate signature page hereof or on the 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 Administrative 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 Requisite
Lenders or all the 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 in accordance with Section 11.4, without necessity of notice
to or consent of or approval by Borrower or any other Person. All payments or
other sums received by Administrative Agent for the account of the Lenders
(including, without limitation, principal and interest payments) shall not
constitute property or assets of the Administrative Agent and shall be held by
Administrative Agent, solely in its capacity as Administrative Agent for itself
and the other Lenders, subject to the Loan Documents.
(b) Notwithstanding any provision hereof to the contrary,
until such time as a Defaulting Lender has funded its Pro Rata Share of any
Advance which was previously a Non-Pro Rata Advance, or all the other Lenders
have received payment in full (whether by repayment or prepayment) of the
principal and interest due in respect of such Non-Pro Rata Advance, all of the
Obligations owing to such Defaulting Lender hereunder shall be subordinated in
right of payment, as provided in the following sentence, to the prior payment in
full of all principal, interest and fees in respect of all Non-Pro Rata Advances
in which the Defaulting Lender has not funded its Pro Rata Share (such
principal, interest and fees being referred to as "Senior Loans"). All amounts
paid by Borrower and otherwise due to be applied to the Obligations owing to the
Defaulting Lender pursuant to the terms hereof shall be distributed by
Administrative Agent to the other Lenders in accordance with their respective
Pro Rata Shares (recalculated for purposes hereof to exclude the Defaulting
Lender's Pro Rata Share of the Commitment), until all Senior Loans have been
paid in full. This provision governs only the relationship among Administrative
Agent, each Defaulting Lender and the other Lenders; nothing hereunder shall
limit the obligation of Borrower to repay all Advances in accordance with the
terms of this Agreement, nor create an Event of Default if payments are not made
to a Defaulting Lender. 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, (ii) any instruction of Borrower as to its desired application of
payments or (iii) the suspension of such Defaulting Lender's right to vote on
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matters which are subject to the consent or approval of the Requisite Lenders or
all the Lenders. No Unused Facility Fee shall accrue in favor of, or be payable
to, such Defaulting Lender from the date of any failure to fund Advances or
reimburse Administrative Agent for any Liabilities and Costs as herein provided
until such failure has been cured, and Administrative Agent shall be entitled to
(A) withhold or setoff, and to apply to the payment of the defaulted amount and
any related interest, any amounts to be paid to such Defaulting Lender under
this Agreement, and (B) bring an action or suit against such Defaulting Lender
in a court of competent jurisdiction to recover the defaulted amount and any
related interest. In addition, the Defaulting Lender shall indemnify, defend and
hold Administrative Agent and each of the other Lenders harmless from and
against any and all Liabilities and Costs, plus interest thereon at the Default
Rate, which they 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.
10.5 Rights, Exculpation, Etc. Neither Administrative Agent,
any Affiliate of Administrative Agent, nor any of their respective officers,
directors, employees, agents, attorneys or consultants, shall be liable to any
Lender for any action taken or omitted by them under this Agreement or under any
of the other Loan Documents, or in connection herewith or therewith, except that
Administrative Agent shall be liable for its gross negligence or willful
misconduct. Administrative Agent shall not be responsible to any Lender for any
recitals, statements, representations or warranties herein or for the execution,
effectiveness, genuineness, validity, enforceability, collectability or
sufficiency of this Agreement, or any of the other Loan Documents, or any of the
transactions contemplated hereby and thereby; or for the financial condition of
the REIT, Borrower or any of their Affiliates. Administrative Agent shall not be
required to make any inquiry concerning either the performance or observance of
any of the terms, provisions or conditions of this Agreement or any of the other
Loan Documents or the financial condition of the REIT, Borrower or any of their
Affiliates, or the existence or possible existence of any Unmatured Event of
Default or Event of Default.
10.6 Reliance. Administrative Agent shall be entitled to rely
upon any written notices, statements, certificates, orders or other documents,
telecopies or any telephone message believed by it in good faith to be genuine
and correct and to have been signed, sent or made by the proper Person, and with
respect to all matters pertaining to this Agreement or any of the other Loan
Documents and its duties hereunder or thereunder, upon advice of legal counsel
(including counsel for Borrower), independent public accountants and other
experts selected by it.
10.7 Indemnification. To the extent that Administrative Agent
is not reimbursed and indemnified by Borrower, the Lenders will reimburse,
within ten (10) Business Days after notice from Administrative Agent, and
indemnify and defend Administrative Agent from and against any and all
Liabilities and Costs which may be imposed on, incurred by, or asserted against
it in any way relating to or arising out of its role as Administrative Agent
under this Agreement, or any of the other Loan Documents or any action taken or
omitted by Administrative Agent under this Agreement, or any of the other Loan
Documents, in proportion to each Lender's Pro Rata Share; provided that no
Lender shall be liable for any portion of such Liabilities and Costs resulting
from Administrative Agent's gross negligence or willful misconduct. The
obligations of the Lenders under this Section 10.7 shall survive the payment in
full of all Obligations and the termination of this Agreement. In the event that
after payment and distribution of any amount by Administrative Agent to the
Lenders, any Lender or third party, including Borrower, any creditor of Borrower
or a trustee in bankruptcy, recovers from Administrative Agent any amount found
to have been wrongfully paid to Administrative Agent or disbursed by
Administrative Agent to the Lenders, then the Lenders, in proportion to their
respective Pro Rata Shares, shall reimburse Administrative Agent for all such
amounts. Notwithstanding the foregoing, Administrative Agent shall not be
obligated to advance Liabilities and Costs and may require the deposit by each
Lender of its Pro Rata Share of any material Liabilities and Costs reasonably
anticipated by Administrative Agent before they are incurred, made or payable.
10.8 Administrative Agent Individually. With respect to its
Pro Rata Share of the Commitment and the Advances made by it, Administrative
Agent shall have and may exercise the same rights and powers hereunder and is
subject to the same obligations and liabilities as and to the extent set forth
herein for any other Lender. Administrative Agent and any Lender and its
Affiliates may accept deposits from, lend money to, and generally engage in any
kind of banking, trust or other business with the REIT, Borrower or any of their
respective Affiliates as if it were not acting as Administrative Agent or a
Lender pursuant hereto.
10.9 Successor Administrative Agent; Resignation of
Administrative Agent; Removal of Administrative Agent. (a) Administrative Agent
may resign from the performance of all its functions and duties hereunder at any
time by giving at least thirty (30) Business Days' prior written notice to the
Lenders and Borrower, and shall automatically cease to be Administrative Agent
hereunder in the event a petition in bankruptcy shall be filed by or against
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Administrative Agent or the Federal Deposit Insurance Corporation or any other
Governmental Authority shall assume control of Administrative Agent or
Administrative Agent's interests under this Agreement and the other Loan
Documents. Further, the Requisite Lenders (other than Administrative Agent) may
remove Administrative Agent at any time for good cause by giving at least thirty
(30) Business Days' prior written notice to Administrative Agent, Borrower and
all other Lenders. Such resignation or removal shall take effect upon the
acceptance by a successor Administrative Agent of appointment pursuant to clause
(b) or (c).
(b) Upon any such notice of resignation by or removal of
Administrative Agent, the Requisite Lenders shall appoint a successor
Administrative Agent which appointment shall be subject to Borrower's consent
(other than upon the occurrence and during the continuance of any Event of
Default), which shall not be unreasonably withheld or delayed. Any successor
Administrative Agent must be a Lender (i) the senior debt obligations of which
(or such Lender's parent's senior unsecured debt obligations) are rated not less
than Baa-2 by Moody's Investors Service, Inc. or a comparable rating by a rating
agency acceptable to the Requisite Lenders and (ii) which has total assets in
excess of Ten Billion Dollars ($10,000,000,000). Such successor Administrative
Agent shall separately confirm in writing with Borrower the fee to be paid to
such Administrative Agent pursuant to Section 2.5(c).
(c) If a successor Administrative Agent shall not have been so
appointed within said thirty (30) Business Day period, the retiring or removed
Administrative Agent, with the consent of Borrower (other than upon the
occurrence and during the continuance of any Event of Default)(which may not be
unreasonably withheld or delayed), shall then appoint a successor Administrative
Agent who shall meet the requirements described in subsection (b) above and who
shall serve as Administrative Agent until such time, if any, as the Requisite
Lenders, with the consent of Borrower (other than upon the occurrence and during
the continuance of any Event of Default), appoint a successor Administrative
Agent as provided above.
10.10 Consent and Approvals. (a) In addition to any other term
or provision of this Agreement which requires the consent or approval of, or
other action by, the Requisite Lenders, each consent, approval, amendment,
modification or waiver specifically enumerated in this Section 10.10(a) shall
require the consent of the Requisite Lenders:
(i) Approval of any material amendment of organizational
documents (Section 7.2); -----------
(ii) Approval of certain changes in the senior management
(Section 7.4); -----------
(iii) Acceleration following an Event of Default (Section
9.2(a)) or rescission of such acceleration --------------
(Section 9.3);
(iv) Approval of the exercise of rights and remedies under
the Loan Documents following an Event of Default (Section
9.2(a)); --------------
(v) Approval of a change in the method of calculation of any
financial covenants, standards or terms as a result of a change
in GAAP (Section 11.3); and ------------
(vi) Except as referred to in subsection (b) below, approval
of any amendment, modification or termination of this Agreement,
or waiver of any provision herein.
(b) Each consent, approval, amendment, modification or waiver
specifically enumerated in Section 11.4 shall require the consent of all the
Lenders.
(c) In addition to the required consents or approvals referred
to in subsection (a) above, Administrative Agent may at any time request
instructions from Requisite Lenders with respect to any actions or approvals
which, by the terms of this Agreement or of any of the Loan Documents,
Administrative Agent is permitted or required to take or to grant without
instructions from Lenders and if such instructions are promptly requested,
Administrative Agent shall be absolutely entitled to refrain from taking any
action or to withhold any approval and shall not be under any liability
whatsoever to any Person 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 Requisite Lenders. Without limiting the foregoing, no
Lender shall have any right of action whatsoever against Administrative Agent as
a result of Administrative Agent acting or refraining from acting under this
Agreement, or any of the other Loan Documents in accordance with the
instructions of the Requisite Lenders or, where applicable, all the Lenders.
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Administrative Agent shall promptly notify each Lender at any time that the
Requisite Lenders have instructed Administrative Agent to act or refrain from
acting pursuant hereto.
(d) Each Lender agrees that any action taken by Administrative
Agent at the direction or with the consent of the Requisite Lenders in
accordance with the provisions of this Agreement or any Loan Document, and the
exercise by Administrative Agent at the direction or with the consent of the
Requisite 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 the Lenders, except for actions specifically requiring the
approval of all the Lenders. All communications from Administrative 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 thing as to which such
determination, approval, consent or disapproval is requested, or shall advise
each Lender where such matter or thing 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
Administrative Agent by Borrower in respect of the matter or issue to be
resolved, and (iv) shall include Administrative Agent's recommended course of
action or determination in respect thereof. Each Lender shall reply promptly,
but in any event within ten (10) Business Days (the "Lender Reply Period").
Unless a Lender shall give written notice to Administrative Agent that it
objects to the recommendation or determination of Administrative Agent (together
with a written explanation of the reasons behind such objection) within the
Lender Reply Period, such Lender shall be deemed to have approved of or
consented to such recommendation or determination and Borrower and each other
Lender may rely on such approval as if given. With respect to decisions
requiring the approval of the Requisite Lenders or all the Lenders,
Administrative Agent shall submit its recommendation or determination for
approval of or consent to such recommendation or determination to all the
Lenders and upon receiving the required approval or consent shall follow the
course of action or determination recommended to the Lenders by Administrative
Agent or such other course of action recommended by the Requisite Lenders, and
each non-responding Lender shall be deemed to have concurred with such
recommended course of action.
10.11 Certain Agency Provisions Relating to Enforcement.
Should Administrative Agent (i) employ counsel for advice or other
representation (whether or not any suit has been or shall be filed) with respect
to any of the Loan Documents, or (ii) commence any proceeding or in any way seek
to enforce its rights or remedies under the Loan Documents, each Lender, upon
demand therefor from time to time, shall contribute its share (based on its Pro
Rata Share) of the reasonable costs and/or expenses of any such advice or other
representation or enforcement, including, but not limited to, 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;
provided that Administrative Agent shall not be entitled to reimbursement of its
attorneys' fees and expenses incurred in connection with the resolution of
disputes between Administrative Agent and other Lenders unless Administrative
Agent shall be the prevailing party in any such dispute. Any loss of principal
and/or interest resulting from any Event of Default shall be shared by the
Lenders in accordance with their respective Pro Rata Shares. It is understood
and agreed that in the event Administrative Agent determines it is necessary to
engage counsel for the Lenders from and after the occurrence of an Event of
Default, said counsel shall be selected by Administrative Agent.
10.12 Ratable Sharing. Subject to Sections 10.3 and 10.4, the
Lenders agree among themselves that (i) with respect to all amounts received by
them which are applied to the payment of the Obligations, equitable adjustment
will be made so that, in effect, all such amounts will be shared among them
ratably in accordance with their Pro Rata Shares, whether received by voluntary
payment, by counterclaim or cross action or by the enforcement of any or all of
the Obligations, (ii) if any of them shall by voluntary payment or by the
exercise of any right of counterclaim or otherwise, receive payment of a
proportion of the aggregate amount of the Obligations held by it which is
greater than its Pro Rata Share of the payments on account of the Obligations,
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 Pro Rata Shares; 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 10.12 may, to the fullest extent
permitted by law, exercise all its rights of payment with respect to such
participation as fully as if such Lender were the direct creditor of Borrower in
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the amount of such participation. No Lender shall exercise any setoff, banker's
lien or other similar right in respect to any Obligations without the prior
written approval by Administrative Agent.
10.13 Delivery of Documents. Administrative Agent shall, as
soon as reasonably practicable, distribute to each Lender at its primary address
set forth on the appropriate counterpart signature page hereof, or at such other
address as a Lender may request in writing, (i) copies of all documents to which
such Lender is a party or of which such Lender is a beneficiary, (ii) all
documents of which Administrative Agent receives copies from Borrower pursuant
to Sections 5.1 and 11.6, (iii) all other documents or information which
Administrative Agent is required to send to the Lenders pursuant to the terms of
this Agreement, (iv) all other information or documents received by
Administrative Agent at the request of any Lender, and (v) all notices received
by Administrative Agent pursuant to Section 5.2. In addition, within fifteen
(15) Business Days after receipt of a request in writing from a Lender for
written information or documents provided by or prepared by Borrower, the REIT
or any Consolidated Entity, Administrative Agent shall deliver such written
information or documents to such requesting Lender if Administrative Agent has
possession of such written information or documents in its capacity as
Administrative Agent or as a Lender.
10.14 Notice of Events of Default. Administrative Agent shall
not be deemed to have knowledge or notice of the occurrence of any Unmatured
Event of Default or Event of Default (other than nonpayment of principal of or
interest on the Advances) unless Administrative Agent has received notice in
writing from a Lender or Borrower describing such event or condition and
expressly stating that such notice is a notice of an Unmatured Event of Default
or Event of Default. Should Administrative Agent receive such notice of the
occurrence of an Unmatured Event of Default or Event of Default, or should
Administrative Agent send Borrower a notice of Unmatured Event of Default or
Event of Default, Administrative Agent shall promptly give notice thereof to
each Lender. If any individual employed by any Lender who is responsible for
managing, or otherwise involved in, the relationship between such Lender and
Borrower in connection with this Agreement or such Lender and Administrative
Agent in connection with this Agreement, has or acquires actual knowledge of an
Unmatured Event of Default or Event of Default, such Lender shall promptly give
written notice thereof to Administrative Agent.
10.15 Syndication Agent. Notwithstanding anything contained
herein which may be construed to the contrary, the Syndication Agent shall not
exercise any of the rights or have any of the responsibilities of the
Administrative Agent hereunder, or any other rights or responsibilities other
than its rights and responsibilities as Lender hereunder.
ARTICLE 11
----------
MISCELLANEOUS
-------------
11.1 Expenses.
(a) Generally. Borrower agrees to pay, or reimburse
Administrative Agent for, within seven (7) days after receipt of written demand,
all of Administrative Agent's external audit, legal, appraisal, valuation and
investigation expenses and for all other reasonable costs and expenses of every
type and nature (including, without limitation, the fees and charges of outside
appraisers and reasonable fees, expenses and disbursements of Administrative
Agent's internal appraisers, environmental advisors or legal counsel) incurred
by Administrative Agent at any time (whether prior to, on or after the date of
this Agreement) in connection with (i) its own audit and investigation of
Borrower and the REIT; (ii) the negotiation, preparation and execution of this
Agreement (including, without limitation, the satisfaction or attempted
satisfaction of any of the conditions set forth in Article 3), and the other
Loan Documents and the making of the Advances; (iii) review and investigation of
Real Property which is proposed for inclusion within the Unencumbered Pool and
Unencumbered Assets within the Unencumbered Pool; (iv) administration of this
Agreement, the other Loan Documents and the Advances, including, without
limitation, consultation with attorneys in connection therewith; (v) syndication
of, assignments of and participations in this Agreement and the other Loan
Documents; and (vi) the protection, collection or enforcement of any of the
Obligations.
(b) After Event of Default. Borrower further agrees to pay, or
reimburse Administrative Agent and the Lenders, for all reasonable out-of-pocket
costs and expenses, including, without limitation, the reasonable attorneys'
fees and disbursements of one law firm incurred by Administrative Agent or the
Lenders after the occurrence and during the continuance of an Event of Default
(i) in enforcing any Obligation or exercising or enforcing any other right or
remedy available by reason of such Event of Default; (ii) in connection with any
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refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or in any insolvency or bankruptcy
proceeding; (iii) in commencing, defending or intervening in any litigation or
in filing a petition, complaint, answer, motion or other pleadings in any legal
proceeding relating to Borrower or the REIT and related to or arising out of the
transactions contemplated hereby; or (iv) in taking any other action in or with
respect to any suit or proceeding (whether in bankruptcy or otherwise).
11.2 Indemnity. Borrower further agrees to defend, protect,
indemnify and hold harmless Administrative Agent, each and all of the Lenders,
each of their respective Affiliates and each of the respective officers,
directors, employees, agents, attorneys and consultants (including, without
limitation, those retained in connection with the satisfaction or attempted
satisfaction of any of the conditions set forth in Article 3) of each of the
foregoing (collectively called the "Indemnitees") from and against any and all
Liabilities and Costs imposed on, incurred by, or asserted against such
Indemnitees (whether based on any federal or state laws or other statutory
regulations, including, without limitation, securities and commercial laws and
regulations, under common law or in equity, and based upon contract or
otherwise, including any liability and costs arising as a result of a
"prohibited transaction" under ERISA to the extent arising from or in connection
with the past, present or future operations of the REIT or Borrower or their
respective predecessors in interest) in any manner relating to or arising out of
this Agreement or the other Loan Documents, or any act, event or transaction
related or attendant thereto, the making of and participation in the Advances
and the management of the Advances, or the use or intended use of the proceeds
of the Advances (collectively, the "Indemnified Matters"); provided, however,
that Borrower shall have no obligation to an Indemnitee hereunder with respect
to (a) matters for which such Indemnitee has been compensated pursuant to or for
which an exemption is provided in Section 2.4(g) or any other provision of this
Agreement, and (b) Indemnified Matters to the extent caused by or resulting from
the willful misconduct or gross negligence of that Indemnitee, as determined by
a court of competent jurisdiction. To the extent that the undertaking to
indemnify, pay and hold harmless set forth in the preceding sentence may be
unenforceable because it is violative of any law or public policy, Borrower
shall contribute the maximum portion which it is permitted to pay and satisfy
under applicable law to the payment and satisfaction of all Indemnified Matters
incurred by the Indemnitees.
11.3 Change in Accounting Principles and "Funds from
Operations" Definition. Except as otherwise provided herein, if any changes in
accounting principles from those used in the preparation of the most recent
financial statements delivered to Administrative Agent pursuant to the terms
hereof are hereafter required or permitted by the rules, regulations,
pronouncements and opinions of the Financial Accounting Standards Board or the
American Institute of Certified Public Accountants (or successors thereto or
agencies with similar functions) and are adopted by the REIT or Borrower with
the agreement of its Accountants and such changes result in a change in the
method of calculation of any of the financial covenants, standards or terms
found herein, the parties hereto agree to enter into negotiations in order to
amend such provisions so as to equitably reflect such changes with the desired
result that the criteria for evaluating the financial condition of the REIT and
the Consolidated Entities shall be the same after such changes as if such
changes had not been made; provided, however, that no change in GAAP that would
affect the method of calculation of any of the financial covenants, standards or
terms shall be given effect in such calculations until such provisions are
amended, in a manner satisfactory to the Requisite Lenders, to so reflect such
change in accounting principles. The definition of "Funds from Operations" set
forth in Article 1 is based upon the definition of "Funds From Operations"
promulgated by the National Association of Real Estate Investment Trusts and
effective as of January 1, 2000 (the "NAREIT Definition"). If the NAREIT
Definition is modified after the date of this Agreement, the parties hereto
agree to enter into negotiations if any party so requests in order to amend the
definition of "Funds from Operations" set forth in this Agreement to make it
consistent with the modified NAREIT Definition; provided, however, that no
change in such definition of "Funds from Operations" shall be given effect until
such definition is amended, in a manner satisfactory to Requisite Lenders, to so
reflect such modification in the NAREIT Definition of "Funds From Operations";
and provided further, however, that if the effect of such change in the
definition of "Funds from Operations" is to restrict the amount of distributions
permitted under this Agreement to amounts less than what are required to
maintain the REIT's status as a real estate investment trust under the Code,
then Borrower shall be permitted to make the minimum distribution necessary to
maintain the REIT's status as a real estate investment trust under the Code so
long as such distribution would have been permitted under the "Funds from
Operations" definition in effect as of the Closing Date.
11.4 Amendments and Waivers. (a) No amendment or modification
of any provision of this Agreement shall be effective without the written
agreement of Requisite Lenders (after notice to all the Lenders) and Borrower
(except for amendments to Section 10.4(a) which do not require the consent of
Borrower); provided that any amendment or waiver to any covenant set forth in
Articles 6, 7 and 8 of the Second Amended and Restated Credit Agreement shall
automatically amend or waive the related covenant herein and shall be effective
as of the effective date of such amendment to the Second Amended and Restated
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Credit Agreement without the consent of the Lenders or the Borrower, and (b) no
termination or waiver of any provision of this Agreement, or consent to any
departure by Borrower therefrom (except as expressly provided in Section 2.4(e)
with respect to waivers of late fees), shall in any event be effective without
the written concurrence of the Requisite Lenders (after notice to all the
Lenders), which the Requisite Lenders shall have the right to grant or withhold
at their sole discretion, except that (A) the following amendments,
modifications or waivers shall require the consent of Requisite Lenders (which
Requisite Lenders must include LCPI, as a Lender):
(i) changing the definitions of "Total Liabilities,"
"Gross Asset Value," "Unencumbered Asset Value," "Unencumbered Pool,"
or "Debt", or the definition of any defined term used in any of the
foregoing definitions; and
(B) the following amendments, modifications or waivers shall require the consent
of all the Lenders:
(i) increasing the Commitment and/or any Lender's Pro Rata
Share of the Commitment;
(ii) changing the principal amount or final maturity of the
Advances or otherwise changing the Maturity Date, except as
otherwise provided in, and subject to the terms and conditions
of, Section 2.1(e);
(iii) reducing the interest rates applicable to the
Advances;
(iv) reducing the rates on which fees payable pursuant
hereto are determined;
(v) forgiving or delaying any amount payable or receivable
under Article 2 (other than late fees in accordance with Section
2.4(e));
(vi) changing the definition of "Requisite Lenders" or "Pro
Rata Shares";
(vii) changing any provision contained in this Section 11.4;
(viii) releasing any obligor under any Loan Document, unless
such release is otherwise required or permitted by the terms of
this Agreement;
(ix) amending or otherwise modifying the Guaranty; or
(x) consenting to assignment by Borrower of all of its
duties and Obligations hereunder pursuant to Section 11.14.
No amendment, modification, termination or waiver of any provision of Article 10
or any other provision referring to Administrative Agent shall be effective
without the written concurrence of Administrative Agent, but only if such
amendment, modification, termination or waiver alters the obligations or rights
of Administrative Agent. Any waiver or consent shall be effective only in the
specific instance and for the specific purpose for which it was given. No notice
to or demand on Borrower in any case shall entitle Borrower to any other further
notice or demand in similar or other circumstances. Any amendment, modification,
termination, waiver or consent effected in accordance with this Section 11.4
shall be binding on each assignee, transferee or recipient of Administrative
Agent's or any Lender's Pro Rata Share of the Commitment under this Agreement or
the Advances at the time outstanding. Borrower shall be entitled to rely on any
amendment or waiver executed by the Administrative Agent on behalf of the
Lenders provided that Administrative Agent certifies to Borrower that
Administrative Agent obtained the approvals or consents required under this
Agreement of the Requisite Lender or all the Lenders, as the case may be.
11.5 Independence of Covenants. All covenants hereunder shall
be given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or be otherwise within the limitations of, another covenant shall
not avoid the occurrence of an Event of Default or Unmatured Event of Default if
such action is taken or condition exists, and if a particular action or
condition is expressly permitted under any covenant, unless expressly limited to
such covenant, the fact that it would not be permitted under the general
provisions of another covenant shall not constitute an Event of Default or
Unmatured Event of Default if such action is taken or condition exists.
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11.6 Notices and Delivery Unless otherwise specifically
provided herein, any consent, notice or other communication herein required or
permitted to be given shall be in writing and may be personally served,
telecopied or sent by courier service or United States mail and shall be deemed
to have been given when delivered in person or by courier service, upon receipt
of a telecopy (or on the next Business Day if such telecopy is received on a
non-Business Day or after 5:00 p.m. on a Business Day) or four (4) Business Days
after deposit in the United States mail (registered or certified, with postage
prepaid and properly addressed). Notices to Administrative Agent pursuant to
Article 2 shall not be effective until received by Administrative Agent. For the
purposes hereof, the addresses of the parties hereto (until notice of a change
thereof is delivered as provided in this Section 11.6) shall be as set forth
below each party's name on the signature pages hereof, or, as to each party, at
such other address as may be designated by such party in a written notice to all
of the other parties. All deliveries to be made to Administrative Agent for
distribution to the Lenders shall be made to Administrative Agent at the address
specified for notice on the signature page hereto and in addition, a sufficient
number of copies of each such delivery shall be delivered to Administrative
Agent for delivery to each Lender at the address specified for deliveries on the
signature page hereto or such other address as may be designated by
Administrative Agent in a written notice.
11.7 Survival of Warranties, Indemnities and Agreements. All
agreements, representations, warranties and indemnities made or given herein
shall survive the execution and delivery of this Agreement and the other Loan
Documents and the making and repayment of the Advances hereunder and such
indemnities shall survive termination hereof.
11.8 Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of Administrative Agent or any Lender in the
exercise of any power, right or privilege under any of the Loan Documents shall
impair such power, right or privilege or be construed to be a waiver of any
default or acquiescence therein, nor shall any single or partial exercise of any
such power, right or privilege preclude other or further exercise thereof or of
any other right, power or privilege. All rights and remedies existing under the
Loan Documents are cumulative to and not exclusive of any rights or remedies
otherwise available.
11.9 Payments Set Aside. To the extent that Borrower makes a
payment or payments to Administrative Agent or the Lenders, or Administrative
Agent or the Lenders exercise their rights of setoff, and such payment or
payments or the proceeds of such setoff or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then to the
extent of such recovery, the Obligation or part thereof originally intended to
be satisfied, and all rights and remedies therefor, shall be revived and
continued in full force and effect as if such payment had not been made or such
setoff had not occurred.
11.10 Severability. In case any provision in or obligation
under this Agreement or the other Loan Documents shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired thereby,
provided, however, that if the rates of interest or any other amount payable
hereunder, or the collectability thereof, are declared to be or become invalid,
illegal or unenforceable, the Lenders' obligations to make Advances shall not be
enforceable.
11.11 Headings. Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose or be given any substantive effect.
11.12 Governing Law; Waiver. THIS AGREEMENT SHALL BE GOVERNED
BY, AND SHALL BE CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.
11.13 Limitation of Liability. To the extent permitted by
applicable law, no claim may be made by Borrower, any Lender or any other Person
against Administrative Agent or any Lender, or the affiliates, directors,
officers, employees, attorneys or agents of any of them, for any special,
indirect, consequential or punitive damages in respect of any claim for breach
of contract or any other theory of liability arising out of or related to the
transactions contemplated by this Agreement, or any act, omission or event
occurring in connection therewith; and Borrower and each Lender hereby waive,
release and agree not to sue upon any claim for any such damages, whether or not
accrued and whether or not known or suspected to exist in its favor.
-55-
<PAGE>
11.14 Successors and Assigns. This Agreement and the other
Loan Documents shall be binding upon the parties hereto and their respective
successors and assigns and shall inure to the benefit of the parties hereto and
the successors and permitted assigns of Administrative Agent and the Lenders.
The terms and provisions of this Agreement shall inure to the benefit of any
permitted assignee or transferee of the Advances and the Pro Rata Shares of the
Commitment of the Lenders under this Agreement, and in the event of such
transfer or assignment, the rights and privileges herein conferred upon
Administrative Agent and the Lenders shall automatically extend to and be vested
in such transferee or assignee, all subject to the terms and conditions hereof.
Borrower's rights and interests hereunder and under the other Loan Documents,
and Borrower's duties and Obligations hereunder and under the other Loan
Documents, shall not be assigned or otherwise transferred without the consent of
all the Lenders.
11.15 Consent to Jurisdiction and Service of Process; Waiver
of Jury Trial. ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST BORROWER WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE, AND ALL JUDICIAL PROCEEDINGS
BROUGHT BY BORROWER WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT
SHALL BE, BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION HAVING
SITUS WITHIN THE BOUNDARIES OF THE FEDERAL COURT DISTRICT OF THE SOUTHERN
DISTRICT OF NEW YORK, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, BORROWER
ACCEPTS, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS, AND IRREVOCABLY
AGREES TO BE BOUND BY ANY FINAL JUDGMENT RENDERED THEREBY FROM WHICH NO APPEAL
HAS BEEN TAKEN OR IS AVAILABLE. BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY
THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID,
TO ITS NOTICE ADDRESS SPECIFIED ON THE SIGNATURE PAGES HEREOF. BORROWER,
ADMINISTRATIVE AGENT AND THE LENDERS IRREVOCABLY WAIVE (A) TRIAL BY JURY IN ANY
ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT,
AND (B) ANY OBJECTION (INCLUDING WITHOUT LIMITATION, ANY OBJECTION OF THE LAYING
OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS) WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY SUCH ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY JURISDICTION SET FORTH ABOVE.
NOTHING HEREIN SHALL AFFECT THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF ADMINISTRATIVE AGENT OR ANY LENDER
TO BRING PROCEEDINGS AGAINST BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
11.16 Counterparts; Effectiveness; Inconsistencies. This
Agreement and any amendments, waivers, consents or supplements hereto may be
executed in counterparts, each of which when so executed and delivered shall be
deemed an original, but all of which, taken together, shall constitute but one
and the same instrument. This Agreement shall become effective when Borrower,
the initial Lenders and Administrative Agent have duly executed and delivered
signature pages of this Agreement to each other (delivery by Borrower to the
Lenders and by any Lender to Borrower and any other Lender being deemed to have
been made by delivery to Administrative Agent). Administrative Agent shall send
written confirmation of the Closing Date to Borrower and each other Lender
promptly following the occurrence thereof. This Agreement and each of the other
Loan Documents shall be construed to the extent reasonable to be consistent one
with the other, but to the extent that the terms and conditions of this
Agreement are actually and directly inconsistent with the terms and conditions
of any other Loan Document, this Agreement shall govern.
11.17 Performance of Obligations. Borrower agrees that
Administrative Agent may, but shall have no obligation to, make any payment or
perform any act required of Borrower under any Loan Document which Borrower has
failed to make or do.
11.18 Construction. The parties to this Agreement acknowledge
that each party and its counsel have reviewed and revised this Agreement and
that the normal rule of construction to the effect that any ambiguities are to
be resolved against the drafting party shall not be employed in the
interpretation of this Agreement or any amendments or exhibits hereto.
11.19 Entire Agreement. This Agreement, taken together with
all of the other Loan Documents and all certificates and other documents
delivered by Borrower to Administrative Agent, embodies the entire agreement and
supersede all prior agreements, written and oral, relating to the subject matter
hereof.
-56-
<PAGE>
11.20 Assignments and Participations. (a) After first
obtaining the approval of Administrative Agent and Borrower (provided that the
approval of Borrower shall not be required upon the occurrence and during the
continuance of any Event of Default), which approval shall not be unreasonably
withheld or delayed, each Lender may assign to one or more banks or financial
institutions, all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Pro Rata Share
of the Commitment and the Advances owing to it) and the other Loan Documents;
provided, however, that (i) each such assignment shall be of a constant, and not
a varying, percentage of the assigning Lender's rights and obligations under
this Agreement and the other Loan Documents, and such percentage of the
assigning Lender's rights and obligations shall be the same percentage with
respect to both such Lender's Pro Rata Share of the Commitment and Advances,
(ii) the aggregate amount of the Pro Rata Share of the Commitment of the
assigning Lender being assigned pursuant to each such assignment (determined as
of the date of the Assignment and Assumption with respect to such assignment)
shall in no event be less than Ten Million Dollars ($10,000,000) and shall be an
integral multiple of One Million Dollars ($1,000,000), (iii) the parties to each
such assignment shall execute and deliver to Administrative Agent, for its
approval and acceptance, an Assignment and Assumption, (iv) Administrative Agent
shall receive from the assignor a processing fee of Three Thousand Dollars
($3,000) and (v) if such assignment is less than all of the Pro Rata Share of
the Commitment of the assigning Lender, after giving effect to such assignment,
the aggregate amount of the Pro Rata Share of the Commitment of the assigning
Lender shall in no event be less than Fifteen Million Dollars ($15,000,000).
Unless Administrative Agent or Borrower gives written notice to the assigning
Lender that it objects to the proposed assignment (together with a written
explanation of the reasons behind such objection) within ten (10) Business Days
following receipt of the assigning Lender's written request for approval of the
proposed assignment, Administrative Agent or Borrower, as the case may be, shall
be deemed to have approved such assignment. Upon such execution, delivery,
approval and acceptance, and upon the effective date specified in the applicable
Assignment and Assumption, (X) the 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 (Y) the assigning Lender thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Assumption, relinquish its rights and be released from
its obligations under this Agreement.
(b) By executing and delivering an Assignment and Assumption,
the assigning Lender thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than 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 pursuant hereto;
(ii) such assigning Lender makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the REIT or Borrower
or the performance or observance by the REIT or Borrower of any of their
respective obligations under any Loan Document or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Article 4 or delivered pursuant to Article 5 to the
date of such assignment and such other Loan Documents and other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Assumption; (iv) such assignee will,
independently and without reliance upon Administrative Agent, such 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 assignee appoints and
authorizes Administrative Agent to take such action as Administrative Agent on
its behalf and to exercise such powers under this Agreement and the other Loan
Documents as are delegated to Administrative Agent by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto; and
(vi) such assignee agrees that it will perform in accordance with their terms
all of the obligations which by the terms of this Agreement are required to be
performed by it as a Lender.
(c) Administrative Agent shall maintain, at its address
referred to on the counterpart signature pages hereof, a copy of each Assignment
and Assumption delivered to and accepted by it and shall record in the Loan
Account the names and addresses of each Lender and the Pro Rata Share of the
Commitment of, and principal amount of the Advances owing to, such Lender from
time to time. Borrower, Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Loan Account as a Lender hereunder for all
purposes of this Agreement.
(d) Upon its receipt of an Assignment and Assumption executed
by an assigning Lender and an assignee approved by Administrative Agent and
-57-
<PAGE>
Borrower as provided in Section 11.20(a), Administrative Agent shall, if such
Assignment and Assumption has been properly completed and is in substantially
the form of Exhibit A, (i) accept such Assignment and Assumption, (ii) record
the information contained therein in the Loan Account, and (iii) give prompt
notice thereof to Borrower. Upon request, Borrower will execute and deliver to
Administrative Agent an appropriate replacement promissory note or replacement
promissory notes in favor of each assignee (and assignor, if such assignor is
retaining a portion of its Pro Rata Share of the Commitment and Advances)
reflecting such assignee's (and assignor's) Pro Rata Share of the Commitment.
Upon execution and delivery of such replacement promissory note(s) the original
promissory note or notes evidencing all or a portion of the Pro Rata Share of
the Commitment and Advances being assigned shall be canceled and returned to
Borrower.
(e) Each Lender may sell participations to one or more banks
or other entities in or to all or a portion of its rights and obligations under
this Agreement without the consent of any other party to this Agreement
(including, without limitation, all or a portion of its Pro Rata Share of the
Commitment and the Advances owing to it) and the other Loan Documents; provided,
however, that (i) such Lender's obligations under this Agreement (including,
without limitation, its obligation to fund its Pro Rata Share of the 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 participating banks or other financial institutions shall
not be a Lender hereunder for any purpose, (iv) Borrower, Administrative 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, (v) the participation interest shall be expressed as a percentage of
the granting Lender's Pro Rata Share of the Commitment as it then exists and
shall not restrict an increase in the Commitment, or in the granting Lender's
Pro Rata Share of the Commitment, so long as the amount of the participation
interest is not affected thereby and (vi) the consent of the holder of such
participation interest shall not be required for amendments or waivers of
provisions of the Loan Documents and the holder of any such participation shall
not be entitled to voting rights under their participation agreement except for
voting rights with respect to (A) extensions of the Maturity Date; or (B)
decreases in the interest rates or fees described in this Agreement.
(f) Borrower will use reasonable efforts to cooperate with
Administrative Agent and the Lenders in connection with the assignment of
interests under this Agreement or the sale of participations herein.
(g) For avoidance of doubt, the parties to this Agreement
acknowledge that the provisions of this Section concerning assignments of
Advances and Notes relate only to absolute assignments and that such provisions
do not prohibit assignments creating security interests, including, without
limitation, any pledge or assignment by a Lender of any Advance or Note to any
Federal Reserve Bank in accordance with applicable law; provided that no such
pledge or assignment shall release such Lender from its obligations thereunder.
To facilitate any such pledge or assignment, Administrative Agent shall, at the
request of such Lender, enter into a letter agreement with the Federal Reserve
Bank in substantially the form of the exhibit to Appendix C to the Federal
Reserve Bank of New York Operating Circular No. 12.
(h) Anything in this Agreement to the contrary
notwithstanding, 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 Administrative Agent and Borrower,
provided that (i) at the time of such assignment such Lender is not a Defaulting
Lender, (ii) such Lender gives Administrative Agent and Borrower at least
fifteen (15) days' prior written notice of any such assignment, (iii) the
parties to each such assignment execute and deliver to Administrative Agent an
Assignment and Assumption, and (iv) Administrative Agent receives from assignor
a processing fee of Three Thousand Dollars ($3,000).
(i) 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.
(j) The dissemination or disclosure by any Lender to any
prospective assignee or participant of any confidential information obtained by
Administrative Agent or the Lenders pursuant to this Agreement or in connection
with the Advances is subject to the terms of Section 5.3.
-58-
<PAGE>
IN WITNESS WHEREOF, this Agreement has been duly executed as
of the date set forth above.
BORROWER: ARDEN REALTY LIMITED
PARTNERSHIP, a Maryland limited partnership
By: ARDEN REALTY, INC.,
a Maryland corporation,
Its sole general partner
By ______________________
Victor Coleman
President and Chief Operating Officer
ADDRESS FOR NOTICE AND DELIVERY:
Arden Realty Limited Partnership
11601 Wilshire Boulevard, 4th Floor
Los Angeles, CA 90025-1740
Attention: Mr. Victor Coleman
Tel: (310) 966-2600
Fax: (310) 966-2699
<PAGE>
ADMINISTRATIVE AGENT LEHMAN COMMERCIAL PAPER INC., as
AND LENDER: Administrative Agent and Lender
By: _____________________________
Name:
Title:
ADDRESS FOR NOTICE AND DELIVERY:
Lehman Brothers Inc.
3 World Financial Center
200 Vesey Street, 12th Floor
New York, NY 10285
Attention: Mr. Francis X. Gilhool
Tel: (212) 526-6970
Fax: (212) 526-0035
DELIVERY OF DOCUMENTS UNDER
SECTIONS 5.2 AND 11.6:
---------------------
Hatfield Phillips
Marquis Two Tower, Suite 2300
285 Peachtree Center Ave
Atlanta, Georgia 30303
Attention: Mr. Beau Durham
Ms. Jennifer Bean
Tel: (404) 420-5600
Fax: (404) 480-5610
with a copy to:
Lehman Brothers Inc.
3 World Financial Center
200 Vesey Street, 12th Floor
New York, NY 10285
Attention: Mr. Tom Buffa
Tel: (212) 526-5153
Fax: (212) 526-0037
<PAGE>
Schedule 1.1
------------
Pro Rata Shares of the Lenders
Lender Pro Rata Share Amount
------ -------------- ------
LCPI $75,000,000
ALL LENDERS 100.00% $75,000,000
<PAGE>
Schedule 2.2
------------
Employees Authorized to Sign Notices of Borrowing
-------------------------------------------------
Richard S. Ziman Chairman and Chief Executive Officer
Victor J. Coleman President and Chief Operating Officer
Daniel Bothe Senior Vice President -- Finance
Richard Davis Senior Vice President -- Chief Accounting Officer
<PAGE>
Schedule 4.1(c)
---------------
Ownership of Borrower
---------------------
<TABLE>
<CAPTION>
Total Number of
Account Name Units @ 3/31/00
------------ ---------------
<S> <C>
Hugh A. Coleman.......................................................................................................2,262
Victor J. Coleman ACF Alex S. Coleman U/CA/UTMA.......................................................................2,262
Jonathan M. Glaser....................................................................................................4,876
Highridge-Apollo Grand Plaza, L.P....................................................................................10,412
Jensen Trust.........................................................................................................17,598
David & Tina Thomas Trust............................................................................................21,329
Anaheim Properties LLC...............................................................................................28,000
Steve Layton.........................................................................................................29,296
Phil Beling..........................................................................................................35,750
Intercity Building Assoc.............................................................................................39,801
Allan Ziman TTEE FBO Todd Support Trust..............................................................................44,481
Allan Ziman TTEE FBO Jenna Support Trust.............................................................................44,481
The Michele Byer Trust...............................................................................................51,032
Hapsmith-Praxis Partners.............................................................................................55,805
Metropolitan Falls Partners..........................................................................................68,918
91 Freeway Partners..................................................................................................86,423
First Rexford Associates (Richard Ziman).............................................................................88,000
Coleman Enterprises..................................................................................................99,458
David and Susan Wilstein Family Trust-1989..........................................................................131,210
Leonard & Joyce Wilstein Revocable Trust of 1986....................................................................131,210
Ziman Realty Group Inc..............................................................................................136,674
Richard Ziman.......................................................................................................226,342
Montour Realty Associates...........................................................................................244,493
Arthur Gilbert & Rosaline Gilbert Trust.............................................................................266,869
Victor J. Coleman................................................................................................. 283,388
---------
TOTAL....................................................................................................2,150,370
=========
</TABLE>
<PAGE>
Schedule 4.1(j)
---------------
Litigation
----------
None.
<PAGE>
Schedule 4.1(s)
---------------
Environmental Matters
---------------------
None.
<PAGE>
Schedule 4.1(v)
---------------
Management Agreements
---------------------
None.
<PAGE>
Schedule 4.2(l)
---------------
Benefit Plans
-------------
Arden Realty 401(k) Plan and Trust, pursuant to Agreement dated December 30,
1996, by and between Arden Realty Limited Partnership and Victor J. Coleman, as
Trustee
<PAGE>
<TABLE>
<CAPTION>
Schedule 8.5
Unencumbered Assets
Property Address City
-------- ------- ----
<S> <C> <C>
4811 Airport Plaza (Bldg. D) 4811 Airport Plaza Long Beach
4900/10 Airport Plaza (F&G) 4900/10 Airport Plaza Long Beach
Century Park Center 9911 W Pico Blvd Los Angeles
Center Promenade 6477 Telephone Rd. Ventura
Sumitomo Bank Building 15250 Ventura Blvd Sherman Oaks
4900 California (CA Twin Center) 4900 California Ave Bakersfield
6800 Owensmouth 6800 Owensmouth Ave Canoga Park
10780 Santa Monica 10780 Santa Monica Blvd Los Angeles
5000 Spring 5000 E. Spring Street Long Beach
9665 Wilshire 9665 Wilshire Beverly Hills
Imperial Bank Tower 701 B. Street San Diego
Westwood Terrace 1640 Sepulveda Blvd Los Angeles
8383 Wilshire 8383 Wilshire Blvd Beverly Hills
Harbor Corporate Center 19300 Hamilton Ave Gardena
Foremost Professional Plaza 12396 World Trade Drive San Diego
Crown Cabot Financial 28202 Cabot Road Laguna Niguel
1000 Town Center 1000 Town Center Oxnard
South Bay Tech. 680 & 690 Knox Avenue Torrance
Northpointe 6601 Center Drive West Los Angeles
Pennsfield Plaza 516 North Pennsfield Place Thousand Oaks
Rancho Plaza 60 & 100 Rancho Rd. Thousand Oaks
Thousand Oaks Plaza 1655 East Thousand Oaks Blvd Thousand Oaks
Bernardo Regency 11545 West Bernardo Court Rancho Bernardo
Glendale Corporate Center 425 East Colorado Street Glendale
City Center 17330, 17360, 17390 Brookhurst Str Fountain Valley
World Savings 11601 Wilshire Boulevard West Los Angeles
Renaissance Court 31416 W. Agoura Road Westlake
Wilshire Pacific Plaza 12301 Wilshire Boulevard Brentwood
3901 Via Oro 3901 Via Oro Long Beach
Tower Plaza I 27555 Ynez Rd Temecula
HDS Plaza 268 West Hospitality San Bernardino
Calabasas Tech Center 26528 Agoura Rd Calabasas
Oceangate Tower 100 Oceangate Long Beach
Lyons Plaza 23502/04 Lyons Ave Santa Clarita
Solar Drive Business Center Oxnard
91 Freeway Center Artesia
5200 West Century 5200 West Century Blvd Los Angeles
535 Brand 535 N. Brand Blvd Glendale
Whittier Financial 15111 and 15141 E. Whittier Blvd Whittier
299 N. Euclid 299 Euclid Pasadena
1821 Dyer 1821 Dyer Irvine
Beverly Sunset Medical 9201 Sunset Boulevard West Hollywood
Westlake Gardens I 2535 Townsgate Road Thousand Oaks
1501 Hughes Way 1501 Hughes Way Long Beach
One Venture 1 Venture Irvine
Lambert Office Plaza 1800 E. Lambert Rd Brea
Skypark Office Plaza 9325/9275 Skypark Ct San Diego
Sorrento Valley Science 5510/50/90 Morehouse Dr San Diego
Waples Tech Center 9591/9565 Waples St. San Diego
Chicago Ave Business Park 3100/90 Chicago Ave Riverside
Ontario Airport Commerce Ctr. - Ind. 1910/20 South Archibald Ontario
Highlands I - Industrial 40880 B County Center Temecula
Highlands II - Industrial 40935 B County Center Temecula
Hunter Business - Industrial 1110 1130 Palmyrita Ave Riverside
11075 Santa Monica 11075 Santa Monica Santa Monica
Hillside Corporate Center 555 Saint Charles Drive Thousand Oaks
Westlake Gardens II 2555 Townsgate Road Westlake Village
6701 Center Drive 6701 Center Drive Los Angeles
2001 Wilshire 2001 Wilshire Blvd Santa Monica
Subject To Satisfaction of Leasing Hurdles
------------------------------------------
Havengate Center 10350 Commerce Center Rancho Cucamonga
Centerlake Plaza 3401 Centerlake Dr. Ontario
</TABLE>
