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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): OCTOBER 27, 2005
MEDICAL PROPERTIES TRUST, INC.
(Exact Name of Registrant as Specified in Charter)
COMMISSION FILE NUMBER 001-32559
MARYLAND 20-0191742
(State or other jurisdiction I. R. S. Employer
of incorporation or organization) Identification No.)
1000 URBAN CENTER DRIVE, SUITE 501
BIRMINGHAM, AL 35242
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code
(205) 969-3755
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the Registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On October 27, 2005, MPT Operating Partnership, L.P., (the "Company"), a
subsidiary of Medical Properties Trust, Inc. (the "Registrant"), entered into a
Credit Agreement dated October 27, 2005, among MPT Operating Partnership, L.P.,
as the borrower, and Merrill Lynch Capital, a division of Merrill Lynch Business
Financial Services Inc. ("Merrill Lynch Capital"), as Administrative Agent and
Lender, and Additional Lenders From Time to Time a Party thereto (the "Credit
Agreement"). The Credit Agreement replaces the Loan Agreement dated December 31,
2004, among various subsidiaries of Medical Properties Trust, Inc., as the
borrowers, and Merrill Lynch Capital, as the lender.
The Credit Agreement provides for secured revolving loans of up to $100
million in aggregate principal amount. The principal amount may be increased to
$175 million at the Company's request. The amounts borrowed are secured by
mortgages on real property owned by certain subsidiaries of the Registrant and
are guaranteed by the Registrant. Properties which the Company uses to secure
the loans under the Credit Agreement make up the "borrowing base." The borrowing
base and, therefore, borrowings, are limited based on: (i) the appraised value
of the borrowing base and (ii) rent income from and financial performance of the
operator lessees of the borrowing base.
Interest on borrowings under the Credit Agreement will accrue monthly at
one month LIBOR, plus a spread which increases as amounts borrowed increase as a
percentage of the borrowing base. The Company must also pay certain fees based
on the amount borrowed in any monthly period. The Credit Agreement expires on
October 26, 2009, and may be extended by the Company for one additional year
upon payment of a fee.
The Credit Agreement contains representations, financial and other
affirmative and negative covenants, events of default and remedies typical for
this type of facility.
The foregoing description of the Credit Agreement is qualified in its
entirety by the full terms and conditions of the Credit Agreement which is filed
as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by
reference.
ITEM 1.02. TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT.
See the information set forth in Item 1.01, which is incorporated by
reference herein.
ITEM 2.03. CREATION OF A DIRECT FINANCIAL OBLIGATION.
See the information set forth in Item 1.01, which is incorporated by
reference herein.
ITEM 9.01. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(C) EXHIBITS:
EXHIBIT
NUMBER DESCRIPTION
- ------- ---------------------------------------------------------------------------------------
10.1 Credit Agreement dated October 27, 2005, among MPT Operating Partnership, L.P., the
borrower, and Merrill Lynch Capital, a division of Merrill Lynch Business Financial
Services, Inc., as Administrative Agent and Lender, and Additional Lenders From Time to
Time a Party thereto
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
MEDICAL PROPERTIES TRUST, INC.
(Registrant)
By: /s/ R. Steven Hamner
----------------------------------------
R. Steven Hamner
Executive Vice President
and Chief Financial Officer
(Principal Financial and Accounting Officer)
Date: November 2, 2005
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INDEX TO EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
- ------- ---------------------------------------------------------------------------------------
10.1 Credit Agreement dated October 27, 2005, among MPT Operating Partnership, L.P., the
borrower, and Merrill Lynch Capital, a division of Merrill Lynch Business Financial
Services, Inc., as Administrative Agent and Lender, and Additional Lenders From Time to
Time a Party thereto
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EXHIBIT 10.1
CREDIT AGREEMENT
DATED AS OF OCTOBER 27, 2005
AMONG
MPT OPERATING PARTNERSHIP, L.P., A DELAWARE LIMITED PARTNERSHIP,
AS BORROWER,
AND
MERRILL LYNCH CAPITAL,
A DIVISION OF MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC.,
AS ADMINISTRATIVE AGENT, AS A LENDER AND
AS SOLE BOOKRUNNER AND SOLE LEAD ARRANGER
AND
THE ADDITIONAL LENDERS
FROM TIME TO TIME PARTY HERETO
[MERRILL LYNCH LOGO]
TABLE OF CONTENTS
PAGE
ARTICLE 1 DEFINITIONS........................................................................................ 1
Section 1.1 Certain Defined Terms......................................................... 1
Section 1.2 Accounting Terms and Determinations........................................... 22
Section 1.3 Other Definitional Provisions................................................. 23
Section 1.4 Funding and Settlement Currency............................................... 23
ARTICLE 2 LOANS AND LETTERS OF CREDIT........................................................................ 23
Section 2.1 Reserved...................................................................... 23
Section 2.2 Revolving Loans............................................................... 23
Section 2.3 Interest, Interest Calculations and Certain Fees.............................. 25
Section 2.4 Notes......................................................................... 26
Section 2.5 Letters of Credit and Letter of Credit Fees................................... 27
Section 2.6 General Provisions Regarding Payment; Loan Account............................ 29
Section 2.7 Maximum Interest.............................................................. 29
Section 2.8 Taxes......................................................................... 30
Section 2.9 Capital Adequacy.............................................................. 31
Section 2.10 Mitigation Obligations........................................................ 31
Section 2.11 Reserved...................................................................... 31
Section 2.12 Reserve Amounts............................................................... 32
Section 2.13 Reserved...................................................................... 32
Section 2.14 Changes in Commitment......................................................... 32
ARTICLE 3 REPRESENTATIONS AND WARRANTIES..................................................................... 33
Section 3.1 Existence and Power........................................................... 33
Section 3.2 Organization and Governmental Authorization; No Contravention................. 34
Section 3.3 Binding Effect................................................................ 34
Section 3.4 Capitalization................................................................ 34
Section 3.5 Financial Information......................................................... 34
Section 3.6 Litigation.................................................................... 35
Section 3.7 Ownership of Property......................................................... 35
Section 3.8 No Default.................................................................... 35
Section 3.9 Labor Matters................................................................. 35
Section 3.10 Regulated Entities............................................................ 35
Section 3.11 Use of Proceeds; Margin Regulations........................................... 36
Section 3.12 Compliance With Laws; Anti-Terrorism Laws..................................... 36
Section 3.13 Taxes......................................................................... 36
Section 3.14 Compliance with ERISA......................................................... 36
Section 3.15 Consummation of Operative Documents; Brokers.................................. 37
Section 3.16 Related Transactions.......................................................... 37
Section 3.17 Material Contracts............................................................ 37
Section 3.18 Compliance with Environmental Requirements; No Hazardous Materials............ 38
Section 3.19 Intellectual Property......................................................... 39
Section 3.20 Real Property Interests....................................................... 39
Section 3.21 Solvency...................................................................... 39
Section 3.22 Full Disclosure............................................................... 39
Section 3.23 Interest Rate................................................................. 40
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TABLE OF CONTENTS
(continued)
PAGE
Section 3.24 Representations and Warranties Incorporated from Operative Documents.......... 40
ARTICLE 4 AFFIRMATIVE COVENANTS.............................................................................. 40
Section 4.1 Financial Statements and Other Reports........................................ 40
Section 4.2 Payment and Performance of Obligations........................................ 42
Section 4.3 Maintenance of Existence; Single Purpose Entity Requirements.................. 42
Section 4.4 Maintenance of Property; Payment of Taxes; Insurance.......................... 42
Section 4.5 Compliance with Laws.......................................................... 44
Section 4.6 Inspection of Property, Books and Records..................................... 44
Section 4.7 Use of Proceeds............................................................... 45
Section 4.8 Lenders' Meetings............................................................. 45
Section 4.9 ERISA......................................................................... 45
Section 4.10 Hazardous Materials; Remediation.............................................. 46
Section 4.11 New Guarantors................................................................ 46
Section 4.12 Further Assurances............................................................ 47
Section 4.13 Litigation.................................................................... 47
Section 4.14 Updates of Representations.................................................... 47
Section 4.15 Power of Attorney............................................................. 47
Section 4.16 Estoppel Certificates......................................................... 48
Section 4.17 Borrowing Base Collateral Administration...................................... 48
ARTICLE 5 NEGATIVE COVENANTS................................................................................. 49
Section 5.1 Debt.......................................................................... 49
Section 5.2 Liens......................................................................... 49
Section 5.3 Contingent Obligations........................................................ 49
Section 5.4 Restricted Distributions...................................................... 50
Section 5.5 Restrictive Agreements........................................................ 50
Section 5.6 Reserved...................................................................... 51
Section 5.7 Consolidations, Mergers and Sales of Assets................................... 51
Section 5.8 Purchase of Assets, Investments............................................... 51
Section 5.9 Transactions with Affiliates.................................................. 51
Section 5.10 Modification of Organizational Documents...................................... 51
Section 5.11 Modification of Certain Agreements............................................ 52
Section 5.12 Fiscal Year................................................................... 52
Section 5.13 Conduct of Business........................................................... 52
Section 5.14 Transfers..................................................................... 52
Section 5.15 Lease Payments................................................................ 53
Section 5.16 Reserved...................................................................... 53
Section 5.17 Reserved...................................................................... 53
Section 5.18 Compliance with Anti-Terrorism Laws........................................... 53
ARTICLE 6 FINANCIAL COVENANTS................................................................................ 53
Section 6.1 Fixed Charge Coverage Ratio................................................... 53
Section 6.2 Maximum Leverage.............................................................. 53
Section 6.3 Maintenance of Net Worth...................................................... 54
Section 6.4 Evidence of Compliance........................................................ 54
ARTICLE 7 CONDITIONS......................................................................................... 54
Section 7.1 Conditions to Closing......................................................... 54
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TABLE OF CONTENTS
(continued)
PAGE
Section 7.2 Conditions to Each Revolving Loan, Support Agreement and Lender Letter of
Credit........................................................................ 54
Section 7.3 Searches...................................................................... 55
Section 7.4 Eligible Property Additions, Deletions and Substitutions...................... 56
ARTICLE 8 RESERVED........................................................................................... 57
ARTICLE 9 REAL PROPERTY MATTERS.............................................................................. 57
Section 9.1 Leases........................................................................ 57
Section 9.2 Property Use and Operation.................................................... 57
Section 9.3 Casualty Proceeds............................................................. 58
Section 9.4 Obligation to Rebuild and Use of Casualty Proceeds Therefor................... 59
Section 9.5 Tax Reduction Proceedings..................................................... 60
Section 9.6 Commingling; FIRPTA........................................................... 60
Section 9.7 Representations and Warranties................................................ 60
ARTICLE 10 reserved.......................................................................................... 61
ARTICLE 11 EVENTS OF DEFAULT................................................................................. 61
Section 11.1 Events of Default............................................................. 61
Section 11.2 Acceleration and Suspension or Termination of Revolving Loan Commitment....... 64
Section 11.3 Cash Collateral............................................................... 64
Section 11.4 Default Rate of Interest...................................................... 64
Section 11.5 Setoff Rights................................................................. 64
Section 11.6 Application of Proceeds....................................................... 65
Section 11.7 Waivers....................................................................... 65
Section 11.8 Injunctive Relief............................................................. 67
Section 11.9 Marshalling................................................................... 67
ARTICLE 12 EXPENSES AND INDEMNITY............................................................................ 67
Section 12.1 Expenses...................................................................... 67
Section 12.2 Indemnity..................................................................... 68
ARTICLE 13 ADMINISTRATIVE AGENT.............................................................................. 68
Section 13.1 Appointment and Authorization................................................. 68
Section 13.2 Administrative Agent and Affiliates........................................... 69
Section 13.3 Action by Administrative Agent................................................ 69
Section 13.4 Consultation with Experts..................................................... 69
Section 13.5 Liability of Administrative Agent............................................. 69
Section 13.6 Indemnification............................................................... 70
Section 13.7 Right to Request and Act on Instructions...................................... 70
Section 13.8 Credit Decision............................................................... 70
Section 13.9 Collateral Matters............................................................ 70
Section 13.10 Agency for Perfection......................................................... 71
Section 13.11 Notice of Default............................................................. 71
Section 13.12 Successor Administrative Agent................................................ 71
Section 13.13 Disbursements of Revolving Loans; Payment and Sharing of Payment.............. 72
Section 13.14 Right to Perform, Preserve and Protect........................................ 75
iii
TABLE OF CONTENTS
(continued)
PAGE
Section 13.15 Additional Titled Agents...................................................... 76
Section 13.16 Amendments and Waivers........................................................ 76
Section 13.17 Assignments and Participations................................................ 77
Section 13.18 Definitions................................................................... 79
ARTICLE 14 MISCELLANEOUS..................................................................................... 80
Section 14.1 Survival...................................................................... 80
Section 14.2 No Waivers.................................................................... 80
Section 14.3 Notices....................................................................... 80
Section 14.4 Severability.................................................................. 81
Section 14.5 Amendments and Waivers........................................................ 81
Section 14.6 Assignments; Participations................................................... 81
Section 14.7 Headings...................................................................... 82
Section 14.8 Confidentiality............................................................... 82
Section 14.9 Waiver of Consequential and Other Damages..................................... 82
Section 14.10 Governing Law; Submission to Jurisdiction..................................... 83
Section 14.11 Waiver of Jury Trial.......................................................... 83
Section 14.12 Publication; Advertisement.................................................... 83
Section 14.13 Counterparts; Integration..................................................... 84
Section 14.14 No Strict Construction........................................................ 84
Section 14.15 Lender Approvals.............................................................. 84
Section 14.16 Waivers....................................................................... 84
Section 14.17 Release of Administrative Agent and Lenders................................... 85
Section 14.18 Knowledge..................................................................... 85
iv
CREDIT AGREEMENT
THIS CREDIT AGREEMENT is dated as of October 27, 2005 by and among
MPT OPERATING PARTNERSHIP, L.P., a Delaware limited partnership, as Borrower,
the financial institutions or other entities from time to time parties hereto,
each as a Lender, and MERRILL LYNCH CAPITAL, a division of Merrill Lynch
Business Financial Services Inc., individually as a Lender, as Administrative
Agent, Sole Bookrunner and Sole Lead Arranger.
RECITALS
R-1 Merrill Lynch and the Restricted Subsidiaries that are Credit
Parties on the date hereof are parties to the Existing Agreement, under which
there is outstanding $40,054,167 principal amount of loans.
R-2 Borrower and Parent REIT made as of December 31, 2004 to and for
the benefit of Merrill Lynch a Payment Guaranty with respect to, among other
things, the obligations of such Restricted Subsidiaries under the Existing
Agreement and the promissory notes delivered in connection therewith.
R-3 Borrower has requested that Lenders make available to Borrower,
revolving and/or letter of credit financing facilities as described herein, the
initial proceeds of which shall be applied to pay in full amounts due under the
Existing Agreement, and the balance of which shall be used for working capital
purposes of Borrower and the other Credit Parties.
R-4 Lenders are willing to extend such credit to Borrower under the
terms and conditions herein set forth.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Borrower, Lenders and Administrative
Agent agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 CERTAIN DEFINED TERMS.
The following terms have the following meanings:
"ACCREDITING ORGANIZATION" means JCAHO, AOA or any other
organization that has issued an accreditation with respect to a Property.
"ADMINISTRATIVE AGENT" means Merrill Lynch, in its capacity as
administrative agent for the Lenders hereunder, as such capacity is established
in, and subject to the provisions of, Article 13, and the successors of Merrill
Lynch in such capacity.
"AFFILIATE" means with respect to any Person (a) any Person that
directly or indirectly controls such Person, (b) any Person which is controlled
by or is under common control with such controlling Person, and (c) each of such
Person's (other than, with respect to any Lender, any Lender's) officers or
directors (or Persons functioning in substantially similar roles) and the
spouses, parents, descendants and siblings of such officers, directors or other
Persons. As used in this definition, the term "control" of a Person means the
possession, directly or indirectly, of the power to vote five percent (5%) or
more of any class of voting securities of such Person or to direct or cause the
direction of the
management or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"AGENT FEE LETTER" means that certain fee letter dated as of the
date hereof among Borrower and Administrative Agent, as the same may be amended,
supplemented, restated or otherwise modified from time to time.
"AGREEMENT" means this Credit Agreement, as the same may be amended,
supplemented, restated or otherwise modified from time to time.
"ANTI-TERRORISM LAWS" means any Laws relating to terrorism or money
laundering, including Executive Order No. 13224 (effective September 24, 2001),
the USA PATRIOT Act, the Laws comprising or implementing the Bank Secrecy Act,
and the Laws administered by OFAC.
"AOA" means the American Osteopathic Association operating under its
Healthcare Facilities Accreditation Program.
"APPRAISAL" means a complete, self-contained appraisal of a Property
performed in accordance with FIRREA and Administrative Agent's appraisal
requirements by an independent appraiser licensed in the state in which such
Property is located and selected and retained by Administrative Agent, which, in
Administrative Agent's sole discretion, may be (i) a copy of any FIRREA
appraisal prepared for another financial institution within the six (6) months
prior to the date an appraisal is requested or required to be delivered pursuant
to this Agreement or (ii) an update of such appraisal or a new appraisal.
"ASSET DISPOSITION" means any sale, lease, license, transfer,
assignment or other consensual disposition by any Credit Party of any asset, or
any termination of any leasehold estate of a Credit Party or reduction in the
term of any leasehold estate of a Credit Party, but excluding dispositions of
Cash Equivalents.
"ASSIGNMENT AGREEMENT" means an agreement pursuant to which any
Lender shall assign any or all of its interests as a Lender hereunder pursuant
to Section 13.17, as substantially in the form of Exhibit A hereto.
"ASSIGNMENT OF LEASES" means an assignment of leases, rents and
profits to Administrative Agent with respect to the applicable Restricted
Subsidiary's interests in an Eligible Property (which assignment may be
contained within the related Mortgage Instrument); provided that each such
Assignment of Leases shall, subject to the terms and conditions of the
applicable underlying Lease, directly assign to Administrative Agent the
following: (a) all existing and future leases, subleases, tenancies, licenses,
occupancy agreements or agreements to lease all or any portion of such Eligible
Property (including, without limitation, any applicable Property Lease), whether
written or oral or for a definite period or month-to-month, together with any
extensions, renewals, amendments, modifications or replacements thereof, and any
options, rights of first refusal or guarantees of any tenant's obligations under
any Lease now or hereafter in effect with respect to such Eligible Property; and
(b) all rents (including, without limitation, base rents, minimum rents,
additional rents, percentage rents, parking, maintenance and deficiency rents
and payments which are characterized under the terms of the applicable Lease as
payments of interest and/or principal with respect to such Eligible Property),
security deposits, tenant escrows, income, receipts, revenues, reserves, issues
and profits of such Eligible Property from time to time accruing, including,
without limitation, (i) all rights to receive payments arising under, derived
from or relating to any Lease, (ii) all lump sum payments for the cancellation
or termination of any Lease, the waiver of any term thereof, or the exercise of
any right of first refusal, call option, put option or option to purchase, and
(iii) the return of any insurance premiums or ad valorem tax payments
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made in advance and subsequently refunded. In furtherance (and not limitation)
of the foregoing, each Assignment of Leases shall assign to Administrative Agent
any and all of such Restricted Subsidiary's rights to collect or receive any
payments with respect to such Eligible Property. Finally, each Assignment of
Leases shall, in any case, be in form and substance satisfactory to
Administrative Agent in its discretion and suitable for recording in the
applicable jurisdiction; and "ASSIGNMENTS OF LEASES" means a collective
reference to each such Assignment of Leases.
"BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy", as the same may be amended, modified or supplemented from time to
time, and any successor statute thereto.
"BASE RATE" means, for each day, a rate per annum (rounded upwards,
if necessary, to the nearest 1/100 of 1%) equal to the rate of interest which is
identified and normally published by Bloomberg Professional Service Page BBAM 1
as the offered rate for loans in United States dollars for the period of one (1)
month under the caption British Bankers Association LIBOR Rates as of 11:00 a.m.
(London time) as adjusted on a daily basis and effective on the second full
Business Day preceding such day (unless such day is not a Business Day, in which
event the next preceding Business Day will be used). If Bloomberg Professional
Service (or another nationally-recognized rate reporting source acceptable to
Administrative Agent) no longer reports the LIBOR or Administrative Agent
determines in good faith that the rate so reported no longer accurately reflects
the rate available to Administrative Agent in the London Interbank Market or if
such index no longer exists or if Page BBAM 1 no longer exists or accurately
reflects the rate available to Administrative Agent in the London Interbank
Market or if any Law makes it unlawful for any Lender to make, fund or maintain
Revolving Loans based on LIBOR, Administrative Agent may select a comparable
replacement index or replacement page, as the case may be.
"BASE RATE MARGIN" means, at any time of determination, the per
annum rate set forth in the table below opposite the Facility Leverage at such
time:
Facility Leverage Applicable Base Rate Margin
- ---------------------------------------------- ---------------------------
Less than 35% 2.35%
Greater than or equal to 35% but less than 45% 2.45%
Greater than or equal to 45% but less than 55% 2.60%
Greater than or equal to 55% 2.75%
"BLOCKED PERSON" means any Person: (a) listed in the annex to, or is
otherwise subject to the provisions of, Executive Order No. 13224, (b) a Person
owned or controlled by, or acting for or on behalf of, any Person that is listed
in the annex to, or is otherwise subject to the provisions of, Executive Order
No. 13224, (c) a Person with which any Lender is prohibited from dealing or
otherwise engaging in any transaction by any Anti-Terrorism Law, (d) a Person
that commits, threatens or conspires to commit or supports "terrorism" as
defined in Executive Order No. 13224, or (e) a Person that is named a "specially
designated national" or "blocked person" on the most current list published by
OFAC or other similar list.
"BORROWER" means, MPT Operating Partnership, L.P., a Delaware
limited partnership.
"BORROWER'S ACCOUNT" means the account specified on the signature
pages hereof below Borrower's name into which Revolving Loans shall, absent
other instructions, be made, or such other account as Borrower may specify by
written notice to Administrative Agent.
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"BORROWING BASE" means, at any date of determination, an amount
equal to 65% of the Borrowing Base Value on such date.
"BORROWING BASE CERTIFICATE" means a certificate, duly executed by a
Responsible Officer of Borrower, appropriately completed and substantially in
the form of Exhibit C hereto, and providing such other information with respect
to the Eligible Properties as Administrative Agent may reasonable require.
"BORROWING BASE DETERMINATION DATE" means the last day of the
calendar quarter most recently ended.
"BORROWING BASE REQUIREMENTS" means collectively that (a) the
Borrowing Base shall not exceed, from the Closing Date until the first
anniversary of the Closing Date, sixty percent (60%) and, at any time
thereafter, seventy percent (70%), of the aggregate value of the Eligible
Properties as of the date of determination as determined by the most recent
Appraisals of such Eligible Properties delivered to Administrative Agent; (b) no
more than forty percent (40%) of the Borrowing Base Value may be comprised of
Eligible Properties which are general acute care hospitals and/or specialty
hospitals (as such term is defined in the Medicare Modernization Act) and (c) no
more than twenty percent (20%) of the Borrowing Base Value may be comprised of
Eligible Properties located in one metropolitan statistical area (as such areas
are from time to time determined and defined by the U.S. Bureau of the Census);
provided, however, that up to thirty percent (30%) of the Borrowing Base Value
may be comprised of Eligible Properties located in Houston, Texas.
"BORROWING BASE VALUE" means, at any date of determination, the
lesser of (a) (i) six (6) multiplied by (ii) the aggregate of the Eligible
Property NOI for the twelve calendar months immediately preceding such date for
each Eligible Property and (b)(i) seven and three-quarters (7.75) multiplied by
(ii) the Eligible Property Rental Payments received by the Restricted
Subsidiaries during the Eligibility Period for each Eligible Property.
"BUSINESS DAY" means any day except a Saturday, Sunday or other day
on which either the New York Stock Exchange is closed, or on which commercial
banks in Chicago and New York City are authorized by law to close.
"CAPITAL LEASE" of any Person means any lease of any property by
such Person as lessee which would, in accordance with GAAP, be required to be
accounted for as a capital lease on the balance sheet of such Person.
"CASH EQUIVALENTS" means any Investment in (a) direct obligations of
the United States or any agency thereof, or obligations guaranteed by the United
States or any agency thereof with a maturity date of no more than one (1) year
from the date of acquisition, (b) commercial paper with a duration of not more
than nine (9) months rated at least A-1 by Standard & Poor's Ratings Service and
P-1 by Moody's Investors Services, Inc., which is issued by a Person (other than
any Credit Party or an Affiliate of any Credit Party) organized under the laws
of any State of the United States or of the District of Columbia, (c) time
deposits, certificates of deposit and banker's acceptances with a duration of
not more than six (6) months issued by any office located in the United States
of any bank or trust company which is organized under the laws of the United
States or any State thereof, or is licensed to conduct a banking business in the
United States, and has capital, surplus and undivided profits of at least
$500,000,000 and which issues (or the parent of which issues) certificates of
deposit or commercial paper with a rating described in clause (b) above, (d)
repurchase agreements and reverse repurchase agreements with a duration of not
more than 30 days with respect to securities described in clause (a) above
entered into with an office of a bank or trust company meeting the criteria
specified in clause (c) above, or (e) any
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money market or mutual fund which invests only in the foregoing types of
investments, has portfolio assets in excess of $5,000,000,000 and is rated AAA
by Standard & Poor's Ratings Service and Aaa by Moody's Investors Services, Inc.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980.
"CLOSED PERIOD" has the meaning set forth in Section 2.2(d).
"CLOSING CHECKLIST" means the closing checklist in the form of
Exhibit F hereto.
"CLOSING DATE" means the date of this Agreement.
"CMS" means the federal Centers for Medicare and Medicaid Services
(formerly the federal Health Care Financing Administration), and any successor
Governmental Authority.
"CODE" means the Internal Revenue Code of 1986.
"COLLATERAL" means all property, now existing or hereafter acquired,
mortgaged or pledged to, or purported to be subjected to a Lien in favor of,
Administrative Agent, for the benefit of Administrative Agent and Lenders,
pursuant to the Security Documents.
"COMMITMENT ANNEX" means Annex A to this Agreement.
"COMMITMENT EXPIRY DATE" means October 26, 2009; provided, that,
upon the written request of Borrower, the Commitment Expiry Date shall be
extended to October 25, 2010, provided, that (i) Borrower has paid to each
Lender an amount equal to .35% of such Lenders Revolving Loan Commitment Amount
at the time of extension, (ii) no Default shall have occurred and be continuing
and (iii) there shall not have occurred a material adverse change, as determined
by Administrative Agent, with respect to the Credit Parties or the Properties.
"COMPLIANCE CERTIFICATE" means a certificate, duly executed by a
Responsible Officer of Borrower, appropriately completed and substantially in
the form of Exhibit B hereto.
"CON" means any certificate of need or similar license which
determines that there is a need for a healthcare facility at a particular
location or within a certain geographic region.
"CONSOLIDATED SUBSIDIARY" means at any date any Subsidiary or other
Person the accounts of which would be consolidated with those of a Credit Party
(or any other Person, as the context may require hereunder) in its consolidated
financial statements if such statements were prepared as of such date.
"CONTINGENT OBLIGATION" means, with respect to any Person, any
direct or indirect liability of such Person: (a) with respect to any debt,
lease, dividend or other obligation of another Person (a "THIRD PARTY
OBLIGATION") if the purpose or intent of such Person incurring such liability,
or the effect thereof, is to provide assurance to the obligee of such Third
Party Obligation that such Third Party Obligation will be paid or discharged, or
that any agreement relating thereto will be complied with, or that any holder of
such Third Party Obligation will be protected, in whole or in part, against loss
with respect thereto; (b) with respect to any undrawn portion of any letter of
credit issued for the account of such Person or as to which such Person is
otherwise liable for the reimbursement of any drawing; (c) under any swap
contract or other derivative obligation; (d) to make take-or-pay or similar
payments if required
-5-
regardless of nonperformance by any other party or parties to an agreement; or
(e) for any obligations of another Person pursuant to any Guarantee or pursuant
to any agreement to purchase, repurchase or otherwise acquire any obligation or
any property constituting security therefor, to provide funds for the payment or
discharge of such obligation or to preserve the solvency, financial condition or
level of income of another Person. The amount of any Contingent Obligation shall
be equal to the amount of the obligation so Guaranteed or otherwise supported
or, if not a fixed and determinable amount, the maximum amount so Guaranteed or
otherwise supported.
"CONTROL" means with respect to any person or entity, including the
correlative meanings of the terms "controlled by," "controlling" and "under
common control with", shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management policies of such person
or entity, whether through the ownership of voting securities, by contract or
otherwise.
"CONTROLLED GROUP" means all members of a group of corporations and
all members of a group of trades or businesses (whether or not incorporated)
under common control which, together with any Credit Party, are treated as a
single employer under Section 414(b), (c), (m) or (o) of the Code or Section
4001(b) of ERISA.
"CREDIT EXPOSURE" means any period of time during which the
Revolving Loan Commitment is outstanding or any Revolving Loan, Reimbursement
Obligation or other Obligation remains unpaid or any Letter of Credit or Support
Agreement remains outstanding; provided, however, that no Credit Exposure shall
be deemed to exist solely due to the existence of contingent indemnification
liability, absent the assertion of a claim with respect thereto.
"CREDIT PARTY" means Borrower and any Guarantor, whether now
existing or hereafter acquired or formed; and "CREDIT PARTIES" means all such
Persons, collectively.
"DEBT" of a Person means at any date, without duplication, (a) all
Indebtedness for Borrowed Money, (b) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (c) all equity securities
of such Person subject to repurchase or redemption otherwise than at the sole
option of such Person, (d) all obligations secured by a Lien on any asset of
such Person, whether or not such obligation is otherwise an obligation of such
Person, (e) "earnouts", purchase price adjustments, profit sharing arrangements,
deferred purchase money amounts and similar payment obligations or continuing
obligations of any nature of such Person arising out of purchase and sale
contracts; (f) all Debt of others Guaranteed by such Person; (g) off-balance
sheet liabilities and/or pension plan liabilities; (h) obligations arising under
non-compete agreements; and (i) obligations arising under bonus, deferred
compensation, incentive compensation or similar arrangements, other than those
arising in the Ordinary Course of Business. Without duplication of any of the
foregoing, Debt of any Credit Party shall include any and all Revolving Loans
and Letter of Credit Liabilities.
"DEFAULT" means any condition or event which with the giving of
notice or lapse of time or both would, unless cured or waived, become an Event
of Default.
"DEFINED PERIOD" means a period ending on the last day of each
calendar month and comprised of the three (3) most recent calendar months then
ended (taken as one accounting period) unless some other period is specified in
this Agreement; provided, that the first Defined Period following the Closing
Date shall consist of the first full calendar month following the Closing Date
(on an annualized basis) and the second Defined Period following the Closing
Date shall consist of the first and second full calendar months following the
Closing Date (on an annualized basis).
-6-
"EBITDAR" means, for any period of determination, Net Income (or
loss) of a Property Lessee earned in connection with the provision of services
at the related Eligible Property and determined in accordance with GAAP, plus
(i) any provision for (or less any benefit from) income and franchise taxes
included in the determination of Net Income for such period, (ii) interest
expense, net of interest income, deducted in the determination of Net Income for
such period, (iii) amortization and depreciation deducted in the determination
of Net Income for such period, (iv) losses (or less gains) from asset
dispositions included in the determination of Net Income for such period
(excluding sales, expenses or losses related to current assets), (v) other
non-cash losses (or less non-cash gains) included in the determination of Net
Income for such period and for which no cash outlay (or cash receipt) is
foreseeable, (vi) extraordinary losses (or less extraordinary gains) included in
the determination of Net Income during such period, net of related tax effects,
(vii) Eligible Property Rental Payments included in the determination of Net
Income for such period, and (viii) management fees under the management
agreement for applicable Property delivered to and approved by Administrative
Agent at the Closing.
"ELIGIBLE PROPERTY" means, as of any Borrowing Base Determination
Date, each of the Vibra Properties and any other Property owned by a Restricted
Subsidiary which, in each case, satisfies each of the conditions described in
Exhibit G hereto.
"ELIGIBLE PROPERTY DELIVERABLES" means each of the deliverables
described on Exhibit E hereto.
"ELIGIBLE PROPERTY NOI" means, for any period of determination,
EBITDAR minus (A) capitalized expenditures, (B) Normalized Management Fees and
(C) such adjustments Administrative Agent may in its sole discretion deem
necessary, including, without limitation, based upon a Property Lessee's actual
recent collection history from Medicare and Medicaid.
"ELIGIBLE PROPERTY RENTAL PAYMENTS" means, with respect to a
Property Lease, base rent payments paid by the applicable Property Lessee during
the applicable calculation period, plus, in the case of the Vibra Properties
only, percentage rent payments paid by the applicable Property Lessee during the
applicable calculation period; provided, however, that (a) such payments shall
be adjusted as Administrative Agent deems necessary to adjust for free rent or
any other rental concessions given during the term of the applicable lease, such
that all rental payments used in the determination of Eligible Property Rental
Payments reflect normalized rents, (b) rents calculated by reference to
pass-through expenses (including, but not limited to, real estate taxes and
insurance) and any other rents that are, in Administrative Agent's
determination, reimbursements for expenses incurred or to be incurred by the
applicable landlord, shall not be included in Eligible Property Rental Payments,
whether or not such rents are denominated as base rents, and (c) rents
calculated by reference to performance of the applicable property or the
financial performance of the applicable Property Lessee and included as Eligible
Property Rental Payments shall be subject to such adjustments as Administrative
Agent shall deem necessary to reflect future expected performance of the
applicable property, including, but not limited to, adjustments to reflect
census trends and anticipated changes in reimbursement rates from Medicare and
Medicaid.
"ELIGIBILITY PERIOD" means the twelve (12) month period preceding
the date of determination, provided, that for any Property Lease whose initial
term commenced within the twelve (12) months preceding the date of
determination, the Eligibility Period shall consist of the first twelve (12)
months of the applicable Property Lease, and the rents for any such months that
have not already passed shall be based upon pro forma rental projections
acceptable to Administrative Agent.
"ENVIRONMENTAL LAWS" means any and all Laws relating to the
environment or the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Materials or
wastes into the environment, including ambient air, surface water, ground water
-7-
or land, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of pollutants,
contaminants, Hazardous Materials or wastes or the clean-up or other remediation
thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as the same may be amended, modified or supplemented from time to time, and any
successor statute thereto, and any and all rules or regulations promulgated from
time to time thereunder.
"ERISA PLAN" means any "employee benefit plan", as such term is
defined in Section 3(3) of ERISA (other than a Multiemployer Plan), which any
Credit Party maintains, sponsors or contributes to, or, in the case of an
employee benefit plan which is subject to Section 412 of the Code or Title IV of
ERISA, to which any Credit Party or any member of the Controlled Group may have
any liability, including any liability by reason of having been a substantial
employer within the meaning of Section 4063 of ERISA at any time during the
preceding five years, or by reason of being deemed to be a contributing sponsor
under Section 4069 of ERISA.
"EVENT OF DEFAULT" has the meaning set forth in Section 11.1.
"EXISTING AGREEMENT" means that certain Revolving Loan Agreement,
dated as of December 31, 2004, by and among 4499 Acushnet Avenue, LLC, 8451
Pearl Street, LLC, 92 Brick Road, LLC, 1300 Campbell Lane, LLC, and Kentfield
THCI Holding Company LLC, each a Delaware limited liability company, and San
Joaquin Health Care Associates Limited Partnership, a Delaware limited
partnership, and Merrill Lynch Capital, a division of Merrill Lynch Business
Financial Services Inc., a Delaware corporation.
"FACILITY LEVERAGE" means, on any date of determination, a fraction,
expressed as a percentage, the numerator of which is the Revolving Loan
Outstanding on such date and the denominator of which is the Borrowing Base on
such date.
"FINANCING DOCUMENTS" means this Agreement, any Notes, the Security
Documents, the Support Agreements, the Agent's Fee Letter, any other fee letter
among Merrill Lynch and Borrower relating to the transactions contemplated
hereby, any subordination or intercreditor agreement pursuant to which any Debt
and/or any Liens securing such Debt is subordinated to all or any portion of the
Obligations, each Financing Documents Guarantee and all other documents,
instruments and agreements contemplated herein or thereby and heretofore
executed, executed concurrently herewith or executed at any time and from time
to time hereafter, as any or all of the same may be amended, supplemented,
restated or otherwise modified from time to time.
"FINANCING DOCUMENTS GUARANTEE" means any agreement that may exist
from time to time pursuant to which any Person other than Borrower shall
Guarantee the Obligations of Borrower under this Agreement and/or the other
Financing Documents.
"FIRREA" means The Financial Institutions Reform, Recovery And
Enforcement Act of 1989, as amended from time to time.
"FISCAL YEAR" means a fiscal year of each Credit Party, ending on
December 31 of each calendar year.
"FIXED CHARGE COVERAGE RATIO" has the meaning provided in the
Compliance Certificate.
-8-
"FOREIGN LENDER" has the meaning set forth in Section 2.8(c).
"FUNDS FROM OPERATIONS" means, for any period of twelve consecutive
months, determined for the Parent REIT and its Consolidated Subsidiaries, the
result of net income (or loss), plus (i) depreciation and amortization expense;
(ii) losses from extraordinary or non-recurring items; (iii) losses on sales of
real estate or other assets; (iv) impairment charges or other loss reserves; (v)
provisions for income taxes for such period; and (vi) stock compensation
expenses minus: (i) gains on sales of real estate or other assets; and (ii)
income tax benefits for such period.
"FUTURE PROPERTY" means any Property of a Material Subsidiary that
Borrower desires to include in the calculation of the Borrowing Base after the
Closing Date.
"GAAP" means generally accepted accounting principles set forth from
time to time 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 agencies with
similar functions of comparable stature and authority within the United States
accounting profession), which are applicable to the circumstances as of the date
of determination.
"GOVERNMENTAL AUTHORITY" means any nation or government, any state
or other political subdivision thereof, and any agency, department or Person
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government and any corporation or other Person
owned or controlled (through stock or capital ownership or otherwise) by any of
the foregoing, whether domestic or foreign.
"GUARANTEE" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (a) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Debt or other obligation (whether arising by virtue of
partnership arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement
conditions or otherwise), or (b) entered into for the purpose of assuring in any
other manner the obligee of such Debt or other obligation of the payment thereof
or to protect such obligee against loss in respect thereof (in whole or in
part), provided, however, that the term Guarantee shall not include endorsements
for collection or deposit in the Ordinary Course of Business. The term
"GUARANTEE" used as a verb has a corresponding meaning.
"GUARANTOR" means any Person that has executed or delivered, or
shall in the future execute or deliver, any Financing Documents Guarantee of any
portion of the Obligations.
"HAZARDOUS MATERIALS" means (a) any "hazardous substance" as defined
in CERCLA, (b) any "hazardous waste" as defined by the Resource Conservation and
Recovery Act, (c) asbestos, (d) polychlorinated biphenyls, (e) petroleum, its
derivatives, by-products and other hydrocarbons, (f) mold, and (g) any other
pollutant, toxic, radioactive, caustic or otherwise hazardous substance
regulated under Environmental Laws.
"HAZARDOUS MATERIALS CONTAMINATION" means contamination (whether now
existing or hereafter occurring) of the improvements, buildings, facilities,
personalty, soil, groundwater, air or other elements on or of the relevant
property by Hazardous Materials, or any derivatives thereof, or on or of any
other property as a result of Hazardous Materials, or any derivatives thereof,
generated on, emanating from or disposed of in connection with the relevant
property.
-9-
"HEALTHCARE COMPLIANT" means that no determination or consequences
with respect to any of the following has occurred which could reasonably be
expected to have a Material Adverse Effect with respect to a Property or its
related Licensed Operator:
(i) any federal, state, local governmental or private payor
civil or criminal investigations, inquiries, validation review or audits or
statement of deficiencies involving and/or related to compliance by such
Licensed Operator with Healthcare Laws (including, without limitation, an
inquiry or investigation of any Person having "ownership, financial or control
interest" (as that phrase is defined in 42 C.F.R. Section 420.201 et seq.) in
such Licensed Operator);
(ii) an owner, officer, manager, employee or Person with a
"direct or indirect ownership interest" (as that phrase is defined in 42 C.F.R.
Section 420.201) in such Licensed Operator: (A) has had a civil monetary penalty
assessed against him or her pursuant to 42 U.S.C. Section 1320a-7a; (B) has been
excluded from participation in a Federal Health Care Program (as that term is
defined in 42 U.S.C. Section 1320a-7b); (C) has been convicted (as that term is
defined in 42 C.F.R. Section 1001.2) of any of those offenses described in 42
U.S.C. Section 1320a-7b or 18 U.S.C. Sections 669, 1035, 1347, 1518; or (D) has
been convicted in any action taken pursuant to the False Claims Act under 31
U.S.C. Sections 3729-3731 or qui tam action brought pursuant to 31 U.S.C.
Section 3729 et seq.;
(iii) any claims, actions or appeals before any commission,
board or agency charged with administering Healthcare Laws or programs operated
under Healthcare Laws (including, without limitation, any intermediary or
carrier, the Provider Reimbursement Review Board or the Administrator of the
Center for Medicare Services) with respect to any state or federal Medicare or
Medicaid cost reports or claims filed by such Licensed Operator, or any
disallowance by any commission, board or agency in connection with any audit of
such cost reports;
(iv) the voluntary disclosure by such Licensed Operator to the
Office of the Inspector General of the United States Department of Health and
Human Services, a Medicare fiscal intermediary or any state's Medicaid program
of a potential overpayment matter involving the submission of claims to such
payor by such Licensed Operator;
(v) any health care survey report related to licensure or
certification (including, without limitation, an annual or biannual Medicare or
Medicaid certification survey report) which includes any statement of
deficiencies pertaining to such Licensed Operator or such Property (whether via
CMS 2567 form or otherwise);
(vi) any revocation, suspension, termination, probation,
restriction, limitation, denial, or nonrenewal affecting such Licensed Operator
with respect to any Medicare and/or Medicaid participation or provider
agreement, certification, billing number, assignment (via CMS 855 forms or
otherwise), billing agent or electronic funds transfer instruction, including,
without limitation, any denial of payment for new admissions;
(vii) any revocation, suspension, termination, probation,
restriction, limitation, denial or nonrenewal affecting such Licensed Operator
with respect to any participation or provider agreement with any Third Party
Payor, other than Medicaid or Medicare, including, without limitation, Blue
Cross and/or Blue Shield, and any other private commercial insurance, healthcare
service contractor, provider network, managed care program and employee
assistance program;
(viii) unless not required under applicable Healthcare Laws,
such Licensed Operator or the applicable Restricted Subsidiary does not maintain
in full force and effect (A) a valid CON for the requisite number of beds and
units at such Property, or (B), if no CON is required to be
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maintained by such Licensed Operator or applicable Restricted Subsidiary, a
valid legal authority for the operation of the facility at such Property, in
each case, free from restrictions or known conflicts which would materially
impair the use or operation of such Property for its current use, which shall
not be provisional, probationary or restricted in any way;
(ix) such Licensed Operator or the applicable Restricted
Subsidiary (a) replaced or transferred all or any part of such Property's units
or beds to another site or location; (b) transferred any CON or other Healthcare
Permit or rights thereunder to any Person or to any location other than the
Property to which such CON or Healthcare Permit or rights pertains; or (c)
pledged or hypothecated any CON or other Healthcare Permit or rights as
collateral security for any indebtedness; or
(x) if such Property, Credit Party or Licensed Operator is
accredited by an Accrediting Organization, such Credit Party or Licensed
Operator shall have failed to (i) maintain such accreditation in good standing
and without limitation or impairment, (ii) promptly submit to the applicable
Accrediting Organization a plan of correction for any deficiencies listed on any
accreditation survey report, and (iii) cure all such deficiencies within such
time frame as is necessary to preserve and maintain in good standing and without
limitation or impairment of such accreditation.
"HEALTHCARE LAWS" means all applicable Laws relating to the
possession, control, warehousing and distribution of pharmaceuticals, the
operation of medical facilities, patient healthcare, patient healthcare
information, patient abuse, the quality and adequacy of medical care, rate
setting, equipment, personnel, operating policies, fee splitting, including,
without limitation, (a) all federal and state fraud and abuse laws, including,
without limitation, the federal Anti-Kickback Statute (42 U.S.C.
Section 1320a-7b(6)), the Stark Law (42 U.S.C. Section 1395nn), the civil False
Claims Act (31 U.S.C. Section 3729 et seq.), (b) TRICARE, (c) HIPAA, (d)
Medicare, (e) Medicaid, (f) quality, safety and accreditation standards and
requirements of all applicable state laws or regulatory bodies, (g) all laws,
policies, procedures, requirements and regulations pursuant to which Healthcare
Permits are issued, and (h) any and all other applicable health care laws,
regulations, manual provisions, policies and administrative guidance, each of
(a) through (h) as may be amended from time to time.
"HEALTHCARE PERMIT" means a Permit (a) issued or required under
Healthcare Laws applicable to the business of a Licensed Operator or any of its
Subsidiaries or necessary in the possession, ownership, warehousing, marketing,
promoting, sale, labeling, furnishing, distribution or delivery of goods or
services under Healthcare Laws applicable to the business of a Licensed Operator
or any of its Subsidiaries, (b) issued by any Person from which a Licensed
Operator has received an accreditation, and/or (c) issued or required under
Healthcare Laws applicable to the ownership of a Licensed Location.
"INDEBTEDNESS FOR BORROWED MONEY" means for any Person (without
duplication) (a) all indebtedness created, assumed or incurred in any manner by
such Person representing money borrowed (including by the issuance of debt
securities), (b) all indebtedness for the deferred purchase price of property or
services (other than trade accounts payable arising in the Ordinary Course of
Business), (c) all indebtedness secured by any Lien upon Property of such
Person, whether or not such Person has assumed or become liable for the payment
of such indebtedness, (d) all Capital Leases of such Person, and (e) all
obligations of such Person on or with respect to letters of credit, bankers'
acceptances and other extensions of credit whether or not representing
obligations for borrowed money.
"INDEMNITEES" has the meaning set forth in Section 12.2.
"INTELLECTUAL PROPERTY" means, with respect to any Person, all
patents, trademarks, trade names, trade styles, trade dress, service marks,
logos and other business identifiers, copyrights,
-11-
technology, know-how and processes, computer hardware and software and all
applications and licenses therefor, used in or necessary for the conduct of
business by such Person.
"INVESTMENT" means any investment in any Person, whether by means of
acquiring (whether for cash, property, services, securities or otherwise) or
holding securities, capital contributions, loans, time deposits, advances,
Guarantees or otherwise. 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 thereto.
"JCAHO" means the Joint Commission on Accreditation of Healthcare
Organizations.
"LAWS" means any and all federal, state, local and foreign statutes,
laws, judicial decisions, regulations, guidances, guidelines, ordinances, rules,
judgments, orders, decrees, codes, plans, injunctions, permits, concessions,
grants, franchises, governmental agreements and governmental restrictions,
whether now or hereafter in effect, which are applicable to any Credit Party in
any particular circumstance. "LAWS" includes, without limitation, Healthcare
Laws.
"LC ISSUER" means one or more banks, trust companies or other
Persons in each case expressly identified by Administrative Agent from time to
time, in its sole discretion, as an LC Issuer for purposes of issuing one or
more Letters of Credit hereunder. Without limitation of Administrative Agent's
discretion to identify any Person as an LC Issuer, no Person shall be designated
as an LC Issuer unless such Person maintains reporting systems acceptable to
Administrative Agent with respect to letter of credit exposure and agrees to
provide regular reporting to Administrative Agent satisfactory to it with
respect to such exposure.
"LEASES" means the singular or collective reference to leases,
subleases or other arrangements for occupancy of space within any Property or
any part thereof now existing or hereafter executed, including, without
limitation, all Property Leases.
"LENDER" means each of (a) Merrill Lynch, (b) each other Person
party hereto in its capacity as a lender, (c) each other Person that becomes a
party hereto as lender pursuant to Section 14.6, (d) Administrative Agent, to
the extent of any Revolving Loans made by Administrative Agent which have not
been settled among the Lenders pursuant to Section 13.13, and (e) the respective
successors of all of the foregoing, and "Lenders" means all of the foregoing.
"LENDER LETTER OF CREDIT" means a Letter of Credit issued by an LC
Issuer that is also, at the time of issuance of such Letter of Credit, a Lender.
"LETTER OF CREDIT" means a standby letter of credit issued for the
account of any Credit Party by an LC Issuer which expires by its terms within
one year after the date of issuance and in any event at least thirty (30) days
prior to the Commitment Expiry Date. Notwithstanding the foregoing, a Letter of
Credit may provide for automatic extensions of its expiry date for one or more
successive one (1) year periods provided that the LC Issuer that issued such
Letter of Credit has the right to terminate such Letter of Credit on each such
annual expiration date and no renewal term may extend the term of the Letter of
Credit to a date that is later than the thirtieth (30th) day prior to the
Commitment Expiry Date.
"LETTER OF CREDIT LIABILITIES" means, at any time of calculation,
the sum of (a) without duplication, the amount then available for drawing under
all outstanding Lender Letters of Credit and all Supported Letters of Credit, in
each case without regard to whether any conditions to drawing thereunder can
then be met, plus (b) without duplication, the aggregate unpaid amount of all
Reimbursement
-12-
Obligations in respect of previous drawings made under all such Lender Letters
of Credit and Supported Letters of Credit.
"LICENSED LOCATION" means a Property from which a Licensed Operator
provides or furnishes goods or services governed by Healthcare Laws, and
includes, without limitation, any business location of a Licensed Operator which
is subject to any Healthcare Permit.
"LICENSED OPERATOR" means the singular or collective (as the context
requires) reference to the following Persons: (a) any Person that is licensed
under Healthcare Laws to operate a Licensed Location, or is otherwise providing
or furnishing goods or services governed by Healthcare Laws, or is otherwise
providing or furnishing goods or services (other than the mere leasing of a
Licensed Location as a lessor and the collection of rentals in connection
therewith) from a Licensed Location, (b) any Person with whom a Credit Party or
a Property Lessee has contracted for management or other services for a Licensed
Location, and/or (c) any Person to whom a Restricted Subsidiary has leased a
Licensed Location.
"LIEN" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind, or any other type of
preferential arrangement that has the practical effect of creating a security
interest, in respect of such asset. For the purposes of this Agreement and the
other Financing Documents, any Creditor Party shall be deemed to own subject to
a Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, Capital Lease or other
title retention agreement relating to such asset.
"LITIGATION" means any action, suit or proceeding before any court,
mediator, arbitrator or Governmental Authority.
"LOAN ACCOUNT" has the meaning set forth in Section 2.6(b).
"MANAGEMENT AGREEMENT" has the meaning set forth in paragraph (ff)
of Exhibit G.
"MARGIN STOCK" has the meaning assigned thereto in Regulation U of
the Federal Reserve Board.
"MATERIAL ADVERSE EFFECT" means, with respect to any event, act,
condition or occurrence of whatever nature (including any adverse determination
in any litigation, arbitration, or governmental investigation or proceeding),
whether singly or in conjunction with any other event or events, act or acts,
condition or conditions, occurrence or occurrences, whether or not related (a) a
material adverse change in, or a material adverse effect upon, any of (i) the
condition (financial or otherwise), operations, business, properties or
prospects of any of the Credit Parties or, with respect to the definition
"Healthcare Complaint," a Licensed Operator, (ii) the rights and remedies of
Administrative Agent or Lenders under any Financing Document, or the ability of
any Credit Party to perform any of its obligations under any Financing Document
to which it is a party, (iii) the legality, validity or enforceability of any
Operative Document, or (iv) the existence, perfection or priority of any
security interest granted in any Financing Document or the value of any material
Property; (b) a material impairment to the value of any Property as underwritten
by Lenders as of the most recent Borrowing Base Determination Date; or (c) the
imposition of a fine against or the creation of any liability of any Credit
Party or a Licensed Operator to any Governmental Authority or to any other
Person under or pursuant to any Healthcare Law in excess of $250,000 or, for
purposes of clause (v) of the definition "Healthcare Complaint," $500,000.
"MATERIAL CONTRACTS" has the meaning set forth in Section 3.17.
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"MATERIAL SUBSIDIARY" means each Subsidiary of the Parent REIT or of
Borrower that owns a Property that Borrower desires to be included in the
calculation of the Borrowing Base.
"MAXIMUM LAWFUL RATE" has the meaning set forth in Section 2.7(b).
"MEDICAID" means the medical assistance programs administered by
state agencies and approved by CMS pursuant to the terms of Title XIX of the
Social Security Act, codified at 42 U.S.C. 1396 et seq.
"MEDICARE" means the program of health benefits for the aged and
disabled administered by CMS pursuant to the terms of Title XVIII of the Social
Security Act, codified at 42 U.S.C. 1395 et seq.
"MERRILL LYNCH" means Merrill Lynch Capital, a division of Merrill
Lynch Business Financial Services Inc., and its successors.
"MORTGAGE INSTRUMENT" means, for any Property, a first lien priority
mortgage deed of trust or deed to secure debt in favor of Administrative Agent
(for the benefit of the Lenders) with respect to such Property. Each Mortgage
Instrument shall be in form and substance satisfactory to Administrative Agent,
substantially in the form of Exhibit H hereto, and suitable for recording in the
applicable jurisdiction.
"MULTIEMPLOYER PLAN" means a multiemployer plan, that is intended to
meet the definition set forth in Section 4001(a)(3) of ERISA, to which any
Credit Party or any member of the Controlled Group may have any liability.
"NET INCOME" means, with respect to any Property Lessee, net income
(or loss) determined in conformity with GAAP, provided that there shall be
excluded (i) the income (or loss) of any Person in which such Property Lessee
has a joint interest, except to the extent of the amount of dividends or other
distributions actually paid to such Property Lessee by such Person, (ii) the
income (or loss) of any Person accrued prior to the date it is merged into or
consolidated with such Property Lessee or that Person's assets are acquired by
such Property Lessee, (iii) the income of any subsidiary of such Property Lessee
to the extent that the declaration or payment of dividends or similar
distributions of that income by that subsidiary is not at the time permitted by
operation of the terms of the charter or any agreement, instrument, judgment,
decree, order, statute, rule or governmental regulation applicable to that
subsidiary, (iv) compensation expense resulting from the issuance of capital
stock, stock options or stock appreciation rights issued to former or current
employees, including officers, of such Property Lessee, or the exercise of such
options or rights, in each case to the extent the obligation (if any) associated
therewith is not expected to be settled by the payment of cash by such Property
Lessee or any affiliate thereof, and (v) compensation expense resulting from the
repurchase of capital stock, options and rights described in clause (iv) of this
definition.
"NON-FUNDING REVOLVING LENDER" means a Revolving Lender that has
delivered a notice to Administrative Agent stating that such Revolving Lender
shall cease making Revolving Loans due to the non-satisfaction of one or more
conditions set forth in Article 7, and specifying any such non-satisfied
conditions; provided, however, that any Revolving Lender delivering any such
notice shall be a Non-Funding Revolving Lender solely over the period commencing
on the Business Day following receipt by Administrative Agent of such notice,
and terminating on such date that such Revolving Lender has either revoked the
effectiveness of such notice or acknowledged to Administrative Agent the
satisfaction of the condition specified in such notice.
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"NORMALIZED MANAGEMENT FEES" means, at any date of determination,
the sum of (i) three percent (3%) of revenues received for general acute care
hospitals and specialty hospitals plus (ii) four percent (4%) of revenues
received for long term acute care hospitals and inpatient rehabilitation
facilities, in each case, for the four (4) complete Defined Periods ending prior
to such date.
"NOTES" has the meaning set forth in Section 2.4.
"NOTICE OF BORROWING" means a notice of a Responsible Officer of
Borrower, appropriately completed and substantially in the form of Exhibit D
hereto.
"NOTICE OF LC CREDIT EVENT" means a notice from a Responsible
Officer of Borrower to Administrative Agent with respect to any issuance,
increase or extension of a Letter of Credit specifying: (a) the date of issuance
or increase of a Letter of Credit; (b) the identity of the LC Issuer with
respect to such Letter of Credit, (c) the expiry date of such Letter of Credit;
(d) the proposed terms of such Letter of Credit, including the face amount; and
(e) the transactions that are to be supported or financed with such Letter of
Credit or increase thereof.
"OBLIGATIONS" means all obligations, liabilities and indebtedness
(monetary (including post-petition interest, whether or not allowed) or
otherwise) of each Credit Party under this Agreement or any other Financing
Document, in each case howsoever created, arising or evidenced, whether direct
or indirect, absolute or contingent, now or hereafter existing, or due or to
become due. In addition to, but without duplication of, the foregoing, the
Obligations shall include, without limitation, all obligations, liabilities and
indebtedness arising from or in connection with (a) all Support Agreements, and
(b) all Lender Letters of Credit.
"OFAC" means the U.S. Department of Treasury Office of Foreign
Assets Control.
"OFAC LISTS" means, collectively, the Specially Designated Nationals
and Blocked Persons List maintained by OFAC pursuant to Executive Order No.
13224, 66 Fed. Reg. 49079 (Sept. 25, 2001) and/or any other list of terrorists
or other restricted Persons maintained pursuant to any of the rules and
regulations of OFAC or pursuant to any other applicable Executive Orders.
"OPERATIVE DOCUMENTS" means the Financing Documents and the Property
Leases.
"ORDINARY COURSE OF BUSINESS" means, in respect of any transaction
involving any Person, the ordinary course of such Person's business, as
conducted by such Person in accordance with past practices.
"ORGANIZATIONAL DOCUMENTS" means, with respect to any Person other
than a natural person, the documents by which such Person was organized (such as
a certificate of incorporation, certificate of limited partnership or articles
of organization, and including, without limitation, any certificates of
designation for preferred stock or other forms of preferred equity) and which
relate to the internal governance of such Person (such as by-laws, a partnership
agreement or an operating, limited liability or members agreement).
"PARENT REIT" means Medical Properties Trust, Inc., a Maryland
corporation.
"PAYMENT ACCOUNT" means the account specified on the signature pages
hereof into which all payments by or on behalf of Borrower and Revolving Lenders
to Administrative Agent under the Financing Documents shall be made, or such
other account as Administrative Agent shall from time to time specify by notice
to Borrower.
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"PBGC" means the Pension Benefit Guaranty Corporation and any Person
succeeding to any or all of its functions under ERISA.
"PENSION PLAN" means any ERISA Plan that is subject to Section 412
of the Code or Title IV of ERISA.
"PERMITS" means all governmental licenses, authorizations, provider
numbers, supplier numbers, registrations, permits, certificates, franchises,
qualifications, accreditations, consents and approvals required under all
applicable Laws and required in order to carry on its business as now conducted,
including, without limitation, Healthcare Permits.
"PERMITTED CONTEST" means, with respect to any tax obligation or
other obligation allegedly or potentially owing from any Credit Party to any
governmental tax authority or other third party, a contest maintained in good
faith by appropriate proceedings promptly instituted and diligently conducted
and with respect to which such reserve or other appropriate provision, if any,
as shall be required in conformity with GAAP shall have been made on the books
and records and financial statements of the applicable Credit Party; provided
that (a) compliance with the obligation that is the subject of such contest is
effectively stayed during such challenge; (b) such Credit Party's title to, and
its right to use, the Collateral is not adversely affected thereby and
Administrative Agent's Lien and priority on the Collateral are not adversely
affected, altered or impaired thereby; (c) such Credit Party has given prior
written notice to Administrative Agent of such Credit Party's intent to so
contest the obligation; (d) in the case of real estate taxes or assessments or
mechanic's, workmen's, materialmen's or other like Liens with respect to any
real estate which is part of the Collateral, such Credit Party has obtained an
endorsement, in form and substance satisfactory to Administrative Agent, to the
loan policy of title insurance issued to Administrative Agent insuring over any
Lien created by such obligation, or such Credit Party has deposited with
Administrative Agent a bond or other security satisfactory to Administrative
Agent, in its reasonable discretion, against loss or injury by reason of such
contest or the non-payment of such obligation or charge (and if such security is
cash, Administrative Agent may, but shall not be obligated to, deposit the same
in an interest-bearing account and interest accrued thereon, if any, shall be
deemed to constitute a part of such security for purposes of this Agreement, but
Administrative Agent (i) makes no representation or warranty as to the rate or
amount of interest, if any, which may accrue thereon and shall have no liability
in connection therewith and (ii) shall not be deemed to be a trustee or
fiduciary with respect to its receipt of any such security and any such security
may be commingled with other monies of Administrative Agent); (e) the Collateral
or any part thereof or any interest therein shall not be in any danger of being
sold, forfeited or lost by reason of such contest by such Credit Party; (g) such
Credit Party has given Administrative Agent notice of the commencement of such
contest and upon request by Administrative Agent, from time to time, notice of
the status of such contest by such Credit Party and/or confirmation of the
continuing satisfaction of this definition; and (h) upon a final determination
of such contest, such Credit Party shall promptly comply with the requirements
thereof.
"PERMITTED LIENS" means: (a) deposits or pledges of cash to secure
obligations under workmen's compensation, social security or similar laws, or
under unemployment insurance (but excluding Liens arising under ERISA); (b)
deposits or pledges of cash to secure bids, tenders, contracts (other than
contracts for the payment of money or the deferred purchase price of property or
services), leases, statutory obligations, surety and appeal bonds and other
obligations of like nature arising in the Ordinary Course of Business; (c)
carrier's, warehousemen's, mechanic's, workmen's, materialmen's or other like
Liens on Collateral arising in the Ordinary Course of Business with respect to
obligations which are not due, or which are being contested pursuant to a
Permitted Contest; (d) Liens on Collateral for taxes or other governmental
charges not at the time delinquent or thereafter payable without penalty or the
subject of a Permitted Contest; (e) attachments, appeal bonds, judgments and
other similar Liens on
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Collateral for sums not exceeding $250,000 for any single Property and $750,000
for all Properties in the aggregate, arising in connection with court
proceedings; provided however, that for each $25,000,000 increase in the
Commitment in accordance with Section 2.14, the stated sum for all Properties in
the aggregate shall be increased by $250,000; provided further that the
execution or other enforcement of such Liens is effectively stayed and the
claims secured thereby are the subject of a Permitted Contest; (f) with respect
to real estate, easements, rights of way, restrictions, minor defects or
irregularities of title, none of which, individually or in the aggregate,
materially interfere with the benefits of the security intended to be provided
by the Security Documents, materially affect the value or marketability of the
Collateral, impair the use or operation of the Collateral for the use currently
being made thereof or impair the Credit Parties' ability to pay the Obligations
in a timely manner or impair the use of the Collateral or the ordinary conduct
of the business of any Credit Party and which are set forth as exceptions to or
subordinate matters in the title insurance policy accepted by Administrative
Agent insuring the lien of the Security Documents; (g) Liens and encumbrances in
favor of Administrative Agent under the Financing Documents; (h) Liens on
Collateral existing on the date hereof and set forth on Schedule 5.2 and (i) any
Lien on any asset securing Debt permitted under Section 5.1(d), provided,
however, that such Lien attaches concurrently with or within ninety (90) days
after the acquisition thereof.
"PERMITTED TRANSFER" means (1) any Transfer of a direct or indirect
ownership interest in a Restricted Subsidiary as to which the following
conditions have been satisfied: (a) Borrower shall have given Administrative
Agent a written notice of such Transfer on or before the date of such Transfer,
(b) after giving effect to such Transfer, Borrower (i) owns, directly or
indirectly, not less than 51% of the beneficial interests in such Restricted
Subsidiary and (ii) controls such Restricted Subsidiary and (2) any Transfer of
a direct or indirect ownership interest in Borrower as to which the following
conditions have been satisfied: (a) the Parent REIT shall have given
Administrative Agent a written notice of such Transfer on or before the date of
such Transfer, (b) after giving effect to such Transfer, the Parent REIT (i)
owns, directly or indirectly, not less than 51% of the beneficial interests in
Borrower and (ii) controls Borrower.
"PERSON" means any natural person, corporation, limited liability
company, professional association, limited partnership, general partnership,
joint stock company, joint venture, association, company, trust, bank, trust
company, land trust, business trust or other organization, whether or not a
legal entity, and any Governmental Authority.
"PROPERTY" means the singular reference to each respective portion
of the Collateral consisting of the land, improvements and all other real and
personal property encumbered by the lien of each respective mortgage, deed of
trust, deed to secure the Obligations or similar Security Document constituting
a part of the Financing Documents. "PROPERTIES" means all Property collectively.
"PROPERTY LEASE" means a Lease between a Restricted Subsidiary or a
Material Subsidiary and a Property Lessee pursuant to which a Property is
demised by such Restricted Subsidiary or such Material Subsidiary, as the case
may be, to such Property Lessee, which Lease shall be approved by Administrative
Agent and shall include, among other things, an automatic attornment provision
whereby, in the event of a foreclosure, the tenant automatically shall recognize
the successor owner as landlord and such tenant shall have no right to terminate
its lease in the event of such foreclosure.
"PROPERTY LESSEE" means, with respect to a Vibra Property, the
Person set forth in Schedule 1.1E as the lessee of such Vibra Property set forth
beside the name of such Person, if any, licensed under all applicable Laws as
the operator of such Vibra Property and, with respect to any other Property, any
Person, who shall be reasonably satisfactory to Administrative Agent, to whom
any Restricted Subsidiary or any Material Subsidiary has leased a Property.
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"PRO RATA SHARE" means (a) with respect to a Lender's obligation to
make Revolving Loans, such Lender's right to receive payments of principal and
interest with respect thereto, such Lender's right to receive the unused line
fee described in Section 2.3(b), and such Lender's obligation to share in Letter
of Credit Liabilities and to receive the related Letter of Credit fee described
in Section 2.5(b), the Revolving Loan Commitment Percentage of such Lender, and
(b) for all other purposes (including, without limitation, the indemnification
obligations arising under Section 13.6) with respect to any Lender, the
percentage obtained by dividing (i) the sum of the Revolving Loan Commitment
Amount of such Lender (or, in the event the Revolving Loan Commitment shall have
been terminated, such Lender's then existing Revolving Loan Outstandings), by
(ii) the sum of the Revolving Loan Commitment (or, in the event the Revolving
Loan Commitment shall have been terminated, the then existing Revolving Loan
Outstandings) of all Lenders.
"QUALIFIED GROUND LEASE" means each of the ground leases or
subground leases set forth on Schedule 1.1Q and for a Future Property means any
ground lease (a) which is a direct ground lease granted by the fee owner of real
property, (b) which may be transferred and/or assigned without the consent of
the lessor (or as to which the lease expressly provides that (i) such lease may
be transferred and/or assigned with the consent of the lessor and (ii) such
consent shall not be unreasonably withheld or delayed) or subject to certain
reasonable pre-defined requirements, (c) which has a remaining term (including
any renewal terms exercisable at the sole option of the lessee) of at least
twenty (20) years, (d) under which no material default has occurred and is
continuing, (e) with respect to which a Lien may be granted without the consent
of the lessor, (f) which contains lender protection provisions acceptable to
Administrative Agent, including, without limitation, provisions to the effect
that (i) the lessor shall notify any holder of a Lien in such lease of the
occurrence of any default by the lessee under such lease and shall afford such
holder the option to cure such default, and (ii) in the event that such lease is
terminated, such holder shall have the option to enter into a new lease having
terms substantially identical to those contained in the terminated lease and (g)
which is otherwise acceptable in form and substance to Administrative Agent.
"REIMBURSEMENT OBLIGATIONS" means, at any date, the Obligations of
Borrower then outstanding to reimburse (a) Administrative Agent for payments
made by Administrative Agent under a Support Agreement, and/or (b) any LC
Issuer, for payments made by such LC Issuer under a Lender Letter of Credit.
"REIT" means a real estate investment trust as defined in Sections
856-860 of the Code.
"REQUIRED LENDERS" means, subject to the provisions of Section
13.13(d), at any time Lenders holding (a) more than fifty percent (50%) of the
sum of the Revolving Loan Commitment, or (b) if the Revolving Loan Commitment
has been terminated, more than fifty percent (50%) of the sum of (x) the then
aggregate outstanding principal balance of the Revolving Loans plus (y) the then
aggregate amount of Letter of Credit Liabilities.
"RESPONSIBLE OFFICER" means, with respect to any Credit Party, the
President or any Executive Vice President of such Credit Party.
"RESTRICTED DISTRIBUTION" means as to any Person (a) any dividend or
other distribution (whether in cash, securities or other property) on any equity
interest in such Person (except those payable solely in its equity interests of
the same class), (b) any payment on account of (i) the purchase, redemption,
retirement, defeasance, surrender, cancellation, termination or acquisition of
any equity interests in such Person or any claim respecting the purchase or sale
of any equity interest in such Person or (ii) any option, warrant or other right
to acquire any equity interests in such Person, (c) any management fees,
salaries or other fees or compensation to a Credit Party, an Affiliate of a
Credit Party or
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an Affiliate of any Subsidiary of a Credit Party, (d) any lease or rental
payments to an Affiliate of a Credit Party or an Affiliate of any Subsidiary of
a Credit Party, or (e) repayments of or debt service on loans or other
indebtedness held by a Credit Party, an Affiliate of a Credit Party or an
Affiliate of any Subsidiary of a Credit Party.
"RESTRICTED SUBSIDIARY" means each Subsidiary of the Parent REIT or
of Borrower that owns a Property that is included in the calculation of the
Borrowing Base or was, but no longer is, included in the calculation of the
Borrowing Base but has not been removed therefrom pursuant to Section 7.4.
"REVOLVING LENDER" means each Lender having a Revolving Loan
Commitment Amount in excess of zero (or, in the event the Revolving Loan
Commitment shall have been terminated at any time, each Lender at such time
having Revolving Loan Outstandings in excess of zero).
"REVOLVING LOAN BORROWING" means a borrowing of a Revolving Loan.
"REVOLVING LOAN COMMITMENT" means the sum of each Lender's Revolving
Loan Commitment Amount. The Revolving Loan Commitment as of the closing Date is
equal to $100,000,000, and may be increased by an amount up to $75,000,000
pursuant to the terms of this Agreement.
"REVOLVING LOAN COMMITMENT AMOUNT" means, as to any Lender, the
dollar amount set forth opposite such Lender's name on the Commitment Annex
under the column "Revolving Loan Commitment Amount", as such amount may be
adjusted from time to time as agreed by Borrower, such Lender and Administrative
Agent by any "Amounts Assigned" (with respect to such Lender's portion of
Revolving Loans outstanding and its commitment to make Revolving Loans) pursuant
to the terms of any and all effective Assignment Agreements to which such Lender
is a party.
"REVOLVING LOAN COMMITMENT PERCENTAGE" means, as to any Lender, (a)
on the Closing Date, the percentage set forth opposite such Lender's name on the
Commitment Annex under the column "Revolving Loan Commitment Percentage" (if
such Lender's name is not so set forth thereon, then, on the Closing Date, such
percentage for such Lender shall be deemed to be zero), and (b) on any date
following the Closing Date, the percentage equal to the Revolving Loan
Commitment Amount of such Lender on such date divided by the Revolving Loan
Commitment on such date.
"REVOLVING LOAN LIMIT" means, at any time, the lesser of (a) the
Revolving Loan Commitment and (b) the Borrowing Base.
"REVOLVING LOAN OUTSTANDINGS" means at any time of calculation the
sum of the then existing aggregate outstanding principal amount of Revolving
Loans and the then existing Letter of Credit Liabilities.
"REVOLVING LOANS" has the meaning set forth in Section 2.2(a).
"REVOLVING YIELD MAINTENANCE AMOUNT" means the sum of the present
values (but in any event, not less than zero) of the "REVOLVING MARGIN
COMPONENT" (defined below) of the remaining payments of interest and fees under
this Agreement that will not be made by reason of the early termination of the
Revolving Loans or Lenders' funding obligations in respect thereof, all as
estimated and determined by Administrative Agent in accordance with the formula
set forth below. The "REVOLVING MARGIN COMPONENT" means the portion of the
remaining payments of interest under this Agreement during the Closed Period
calculated based on a static principal sum equal to the Revolving
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Loan Commitment and an assumed interest rate equal to the sum of (a) the highest
Base Rate Margin applicable to the Revolving Loans under this Agreement plus (b)
the percentage per annum equivalent to the all-in effective yield to
Administrative Agent (as estimated by Administrative Agent) in its capacity as a
Lender and as Administrative Agent resulting from the imposition of the unused
line, collateral and other fees provided for in Section 2.2 or in the Agent Fee
letter. For purposes of estimating unused line fees, Administrative Agent shall
assume a usage rate equivalent to Borrower's average usage during the twelve
months preceding the event giving rise to the default or early termination. The
present value of each such estimated monthly payment shall be calculated by
discounting such estimated payment to the date of prepayment by the Discount
Rate. The "DISCOUNT RATE" for each such payment is the rate which, when
compounded monthly, is equivalent to the Treasury Rate (as hereinafter defined),
when compounded semi-annually (as such Treasury Rates are adjusted upwards by
three quarters of one percent (0.75%) per annum in order to adjust for the
benefit of the risk-free investment). The "TREASURY RATE" is the yield
calculated by the linear interpolation of the nominal yields, as reported in the
Federal Reserve Statistical Release H.15 Selected Interest Rates (the "RELEASE")
under the heading "U.S. government securities" and the subheading "Treasury
Constant Maturities" for the week ending prior to the date of prepayment, of
U.S. Treasury Constant Maturities with maturity dates (one longer and one
shorter) most nearly approximating what would have been the payment due date of
each such estimated payment amount but for the termination or default. In the
event the Release is no longer published, Administrative Agent shall select a
comparable publication to determine the Treasury Rate in its commercially
reasonable discretion. Borrower agrees that the foregoing calculations are a
reasonable approximation of Lenders' lost profits in view of the difficulties
and impracticality of determining actual damages resulting from an early
termination of this Agreement or Lenders' funding obligations hereunder.
"SECURITY DOCUMENTS" means any agreement, document, mortgage or
instrument executed concurrently herewith or at any time hereafter pursuant to
which one or more Credit Parties or any other Person either provides, as
security for all or any portion of the Obligations, a Lien on any of its assets
in favor of Administrative Agent for its own benefit and the benefit of the
Lenders, as any or all of the same may be amended, supplemented, restated or
otherwise modified from time to time.
"SINGLE PURPOSE ENTITY REQUIREMENTS" means, with respect to each
Restricted Subsidiary, the requirements that such Restricted Subsidiary (i)
exists solely for the purpose of owning and operating one Property, (ii)
conducts business only in its own name, (iii) does not engage in any business
other than the ownership, management and operation of one Property, (iv) does
not hold, directly or indirectly, any ownership interest (legal or equitable) in
any entity or any real or personal property other than the interest which it
owns in such Property, (v) does not have any assets other than those related to
its interest in such Property and does not have any debt other than as permitted
by this Agreement and does not guarantee or otherwise obligate itself with
respect to the debts of any other Person, (vi) has its own separate books,
records and accounts, (vii) holds itself out as being a company separate and
apart from any other entity, (viii) observes limited liability company,
partnership or corporate formalities, as the case may be, independent of any
other Person.
"SFAS 141 INTANGIBLES" means that portion of the purchase price of a
Property that is allocated to leasehold intangibles and customer relationship
intangibles pursuant to Statement of Financial Accounting Standard No. 141,
Accounting for Business Combinations.
"SOLVENT" means, with respect to any Person, that such Person (a)
owns and will own assets the fair saleable value of which are (i) greater than
the total amount of its liabilities (including Contingent Obligations), and (ii)
greater than the amount that will be required to pay the probable liabilities of
its then existing debts as they become absolute and matured considering all
financing alternatives and potential asset sales reasonably available to it; (b)
has capital that is not unreasonably small in relation to its business as
presently conducted or after giving effect to any contemplated
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transaction; and (c) does not intend to incur and does not believe that it will
incur debts beyond its ability to pay such debts as they become due.
"STATED RATE" has the meaning set forth in Section 2.7(b).
"STOCK" means shares of capital stock, beneficial or partnership
interests, participations or other equivalents (regardless of how designated) of
or in a corporation or equivalent entity, whether voting or non-voting, and
includes, without limitation, common stock and preferred stock.
"STOCK EQUIVALENTS" means all securities (other than Stock)
convertible into or exchangeable for Stock at the option of the holder, and all
warrants, options or other rights to purchase or subscribe for any stock,
whether or not presently convertible, exchangeable or exercisable.
"SUBSIDIARY" means, with respect to any Person, (a) any corporation
of which an aggregate of more than 50% of the outstanding capital stock having
ordinary voting power to elect a majority of the board of directors of such
corporation (irrespective of whether, at the time, capital stock of any other
class or classes of such corporation shall have or might have voting power by
reason of the happening of any contingency) is at the time, directly or
indirectly, owned legally or beneficially by such Person or one or more
Subsidiaries of such Person, or with respect to which any such Person has the
right to vote or designate the vote of more than 50% of such capital stock
whether by proxy, agreement, operation of law or otherwise, and (b) any
partnership or limited liability company in which such Person and/or one or more
Subsidiaries of such Person shall have an interest (whether in the form of
voting or participation in profits or capital contribution) of more than 50% or
of which any such Person is a general partner or may exercise the powers of a
general partner. Unless the context otherwise requires, each reference to a
Subsidiary shall be a reference to a Subsidiary of a Credit Party.
"SUPPORT AGREEMENT" has the meaning set forth in Section 2.5(a).
"SUPPORTED LETTER OF CREDIT" means a Letter of Credit issued by an
LC Issuer in reliance on one or more Support Agreements.
"TAKING" shall mean a condemnation or taking pursuant to the lawful
exercise of the power of eminent domain.
"TANGIBLE NET WORTH" means total stockholders' equity on the Parent
REIT's consolidated balance sheet as reported in its financial statements less
all amounts appearing on the assets side of its consolidated balance sheet
representing intangible assets (other than SFAS 141 Intangibles) under GAAP plus
all accumulated depreciation on real property and accumulated amortization of
SFAS 141 Intangibles owned by the Parent REIT and its Consolidated Subsidiaries.
"TAXES" has the meaning set forth in Section 2.8.
"TERMINATION DATE" means the earliest to occur of (a) the Commitment
Expiry Date, (b) any date on which Administrative Agent accelerates the maturity
of the Revolving Loans pursuant to Section 11.2 or (c) thirty (30) days
following the delivery by Borrower to Administrative Agent of a notice
terminating this Agreement; provided, that Borrower shall not delivery such
notice prior to the date which is eighteen (18) months after the Closing Date.
"THIRD PARTY PAYOR" means Medicare, Medicaid, TRICARE, and other
state or federal health care program, Blue Cross and/or Blue Shield, private
insurers, managed care plans and any other Person or entity which presently or
in the future maintains Third Party Payor Programs.
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"THIRD PARTY PAYOR PROGRAMS" means all payment and reimbursement
programs, sponsored by a Third Party Payor, in which a Licensed Operator
participates.
"TOTAL ASSET VALUE" means the book value, without giving effect to
depreciation of all assets or amortization of SFAS 141 Intangibles of the Parent
REIT and its Consolidated Subsidiaries at such time; less (a) the amount, if
any, of the Parent REIT's investment in any unconsolidated subsidiary, joint
venture or other similar entity, and (b) all amounts appearing on the assets
side of its consolidated balance sheet representing intangible assets under GAAP
(other than SFAS 141 Intangibles).
"TOTAL INDEBTEDNESS" means, as of a given date, all liabilities of
the Parent REIT and its Consolidated Subsidiaries which would, in conformity
with GAAP, be properly classified as a liability on a consolidated balance sheet
of the Parent REIT and its Consolidated Subsidiaries as of such date, excluding
any amounts categorized as accrued expenses, accrued dividends, deposits held,
deferred revenues, minority interests and other liabilities not directly
associated with the borrowing of money.
"TRANSFER" means any sale, transfer, lease (other than a Property
Lease approved by Administrative Agent), conveyance, alienation, pledge,
assignment, mortgage, encumbrance hypothecation or other disposition of (a) all
or any portion of any Credit Party's right, title and interest (legal or
equitable) in and to a Property or any portion of any other Collateral, or (b)
any interest in any Credit Party (other than the Parent REIT).
"TRICARE" means the program administered pursuant to 10 U.S.C.
Section 1071 et. seq), Sections 1320a-7 and 1320a-7a of Title 42 of the United
States Code and the regulations promulgated pursuant to such statutes.
"UCC" means the Uniform Commercial Code of the State of Illinois or
of any other state the laws of which are required to be applied in connection
with the perfection of security interests in any Property.
"UNITED STATES" means the United States of America.
"VIBRA PROPERTY" means a Property leased to and operated by Vibra
Healthcare, LLC and identified on Schedule 1.1V.
"WELFARE PLAN" means a "welfare plan" as defined in Section 3(l) of
ERISA.
"WHOLLY-OWNED SUBSIDIARY" means, with respect to any Person, any
Subsidiary of such Person of which all of the equity securities (other than, in
the case of a corporation, directors' qualifying shares, to the extent legally
required) are directly or indirectly owned and controlled by such Person or one
or more Wholly-Owned Subsidiaries of such Person.
SECTION 1.2 ACCOUNTING TERMS AND DETERMINATIONS.
Unless otherwise specified herein, all accounting terms used herein
shall be interpreted, all accounting determinations hereunder (including,
without limitation, determinations made pursuant to the exhibits hereto) shall
be made, and all financial statements required to be delivered hereunder shall
be prepared on a consolidated basis in accordance with GAAP applied on a basis
consistent with the most recent audited consolidated financial statements of
each Credit Party and its Consolidated Subsidiaries delivered to Administrative
Agent and each of the Lenders on or prior to the Closing Date. If at any time
any change in GAAP would affect the computation of any financial ratio or
financial requirement set forth in any Financing Document, and either Borrower
or the Required Lenders shall so request,
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Administrative Agent, the Lenders and Borrower shall negotiate in good faith to
amend such ratio or requirement to preserve the original intent thereof in light
of such change in GAAP (subject to the approval of the Required Lenders);
provided, however, that until so amended, (a) such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change therein and
(b) Borrower shall provide to Administrative Agent and the Lenders financial
statements and other documents required under this Agreement which include a
reconciliation between calculations of such ratio or requirement made before and
after giving effect to such change in GAAP. All amounts used for purposes of
financial calculations required to be made herein shall be without duplication.
SECTION 1.3 OTHER DEFINITIONAL PROVISIONS.
References in this Agreement to "Articles", "Sections", "Annexes",
"Exhibits" or "Schedules" shall be to Articles, Sections, Annexes, Exhibits or
Schedules of or to this Agreement unless otherwise specifically provided. Any
term defined herein may be used in the singular or plural. "Include", "includes"
and "including" shall be deemed to be followed by "without limitation". Except
as otherwise specified or limited herein, references to any Person include the
successors and assigns of such Person. References "from" or "through" any date
mean, unless otherwise specified, "from and including" or "through and
including", respectively. References to any statute or act shall include all
related current regulations and all amendments and any successor statutes, acts
and regulations. References to any statute or act, without additional reference,
shall be deemed to refer to federal statutes and acts of the United States.
References to any agreement, instrument or document shall include all schedules,
exhibits, annexes and other attachments thereto.
SECTION 1.4 FUNDING AND SETTLEMENT CURRENCY.
Unless otherwise specified herein, the settlement of all payments
and fundings hereunder between or among the parties hereto shall be made in
lawful money of the United States and in immediately available funds.
ARTICLE 2
LOANS AND LETTERS OF CREDIT
SECTION 2.1 RESERVED.
SECTION 2.2 REVOLVING LOANS.
(a) Revolving Loans and Borrowings.
(i) On the terms and subject to the conditions set forth
herein, each Lender severally agrees to make loans to Borrower from time to time
as set forth herein (each a "REVOLVING LOAN", and collectively, "REVOLVING
LOANS") equal to such Lender's Revolving Loan Commitment Percentage of Revolving
Loans requested by Borrower hereunder, provided, however, that after giving
effect thereto, the Revolving Loan Outstandings shall not exceed the Revolving
Loan Limit. Within the foregoing limits, Borrower may borrow under this Section
2.2(a)(i), may prepay or repay Revolving Loans from time to time and may
reborrow Revolving Loans pursuant to this Section 2.2(a)(i).
(ii) Borrower shall deliver to Administrative Agent a Notice
of Borrowing with respect to each proposed Revolving Loan Borrowing (other than
Revolving Loans made pursuant to clause (iii) below), such Notice of Borrowing
to be delivered no later than noon (Chicago time) two (2) Business Days prior to
such proposed borrowing. Once given, a Notice of Borrowing shall be irrevocable
and Borrower shall be bound thereby. Each request for a Revolving Loan shall be
in a minimum amount
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of $250,000 and, if in excess of such amount, in an integral multiple of $50,000
in excess of such amount. Borrower shall also deliver no later than noon
(Chicago time) five (5) Business Days prior to such borrowing to Administrative
Agent in connection with each such proposed Revolving Loan Borrowing a Borrowing
Base Certificate dated as of the Notice of Borrowing prepared with figures and
information as of the close of business on the most recent Borrowing Base
Determination Date immediately preceding the date of such Borrowing Base
Certificate.
(iii) Borrower hereby authorizes Lenders and Administrative
Agent to make Revolving Loans based on telephonic notices made by any Person
which Administrative Agent, reasonably and in good faith, believes to be acting
on behalf of Borrower. Borrower agrees to deliver to Administrative Agent a
Notice of Borrowing in respect of each Revolving Loan requested by telephone no
later than one (1) Business Day following such request. If the Notice of
Borrowing differs in any respect from the action taken by Administrative Agent
and Lenders, the records of Administrative Agent and the Lenders shall govern
absent manifest error. Borrower further hereby authorizes Lenders and
Administrative Agent to make Revolving Loans based on electronic notices made by
any Person which Administrative Agent, reasonably and in good faith, believes to
be acting on behalf of Borrower, but only after Administrative Agent shall have
established procedures acceptable to Administrative Agent for accepting
electronic Notices of Borrowing, as indicated by Administrative Agent's written
confirmation thereof.
(iv) Borrower and each Revolving Lender hereby authorizes
Administrative Agent to make Revolving Loans on behalf of Revolving Lenders, at
any time in its sole discretion, (A) as provided in Section 2.5(c), with respect
to obligations arising under Support Agreements and/or Lender Letters of Credit,
and (B) to pay principal owing in respect of the Revolving Loans (excluding
principal payments in respect of the Revolving Loans commencing one Business Day
following receipt by Administrative Agent of a written notice from any Lender,
in accordance with the provisions of Section 13.11, of the occurrence of an
Event of Default) and interest, fees, expenses and other charges of any Credit
Party from time to time arising under this Agreement or any other Financing
Document, so long as, in each case after giving effect to any such Revolving
Loans, the Revolving Loan Outstandings do not exceed the Revolving Loan Limit;
provided, however, that (x) Administrative Agent shall have no obligation at any
time to make any Revolving Loan pursuant to the provisions of the preceding
sub-clause (B), and (y) Administrative Agent shall have no right to make
Revolving Loans (I) as provided in Section 2.5(c) for the account of any
Revolving Lender that was a Non-Funding Revolving Lender at the time
Administrative Agent executed a Support Agreement, or at the time of issuance of
any Lender Letter of Credit, for which, in either case, reimbursement
obligations have arisen pursuant to Section 2.5(c), and (II) for the account of
any then existing Non-Funding Revolving Lender to pay interest, fees, expenses
and other charges of any Credit Party (other than reimbursement obligations that
have arisen pursuant to Section 2.5(c) in respect of Support Agreements executed
or Lender Letters of Credit issued at the time any such Non-Funding Revolving
Lender was not then a Non-Funding Revolving Lender).
(v) The Borrowing Base shall be determined by Administrative
Agent based on the most recent Borrowing Base Certificate delivered to
Administrative Agent in accordance with this Agreement and such other
information as may be available to Administrative Agent.
(vi) Administrative Agent may from time to time require
reasonable revisions to the form of Notice of Borrowing and Borrowing Base
Certificate.
(b) Mandatory Revolving Loan Repayments and Prepayments.
(i) The Revolving Loan Commitment shall terminate on the
Termination Date. On such Termination Date, there shall become due, and Borrower
shall pay, the entire outstanding
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principal amount of each Revolving Loan, together with accrued and unpaid
interest thereon, and any fees or other amounts due and owing in connection with
this Agreement or the Agent Fee Letter, to, but excluding, the Termination Date.
(ii) If at any time the Revolving Loan Outstandings exceed the
Revolving Loan Limit, then, on the next succeeding Business Day, Borrower shall
repay the Revolving Loans or cash collateralize Letter of Credit Liabilities in
the manner specified in Section 2.5(e) or cancel outstanding Letters of Credit,
or any combination of the foregoing, in an aggregate amount equal to such
excess.
(c) Optional Prepayments. Borrower may, from time to time, upon
three (3) Business Days' prior written notice to Administrative Agent, prepay
the Revolving Loans in whole or in part; provided, however, that any such
partial prepayment shall be in an amount equal to $100,000 and, if in excess of
such amount, in an integral multiple of $25,000 in excess of such amount.
Notwithstanding the foregoing, if the amount of such prepayment shall cause the
Revolving Loan Outstandings to be less than $15,000,000, Administrative Agent
shall (i) cause to be paid to the Lenders a portion of such prepayment equal to
the amount that, when applied to the reduction of the Revolving Loans, would
cause the Revolving Loan Outstandings to equal $15,000,000 and (ii) hold the
remaining portion of such prepayment as a reserve in accordance with Section
2.12.
(d) Restriction on Termination. Borrower shall have no right to
terminate the Revolving Loan Commitment, or to otherwise terminate this
Agreement, on any date which is prior to the date occurring eighteen (18) months
after the Closing Date (such 18-month period being herein referred to as the
"CLOSED PERIOD").
SECTION 2.3 INTEREST, INTEREST CALCULATIONS AND CERTAIN FEES.
(a) Interest. From and following the Closing Date, the Revolving
Loans and the other Obligations shall bear interest at the sum of the Base Rate
plus the applicable Base Rate Margin.
(b) Unused Line Fee. From and following the Closing Date, Borrower
shall pay Administrative Agent, for the benefit of all Lenders committed to make
Revolving Loans, in accordance with their respective Pro Rata Shares, a fee in
an amount equal to (i) (A) the Revolving Loan Commitment minus (B) the average
daily balance of the sum of the Revolving Loan Outstandings during the preceding
month (such result, the "UNUSED REVOLVING LOAN COMMITMENT"), multiplied by (ii)
the per annum rate set forth in the table below opposite the average Unused
Revolving Loan Commitment during such preceding month. Such fee is to be paid
monthly in arrears on the first day of each month.
Average Unused Revolving Loan Commitment Unused Facility Rate
- ---------------------------------------- --------------------
Less than $50,000,000 .375%
Greater than or equal to $50,000,000 .50%
(c) Deferred Commitment Fee. If Lenders' funding obligations in
respect of the Revolving Loan Commitment under this Agreement terminate for any
reason (whether by voluntary termination by Borrower, by reason of the
occurrence of an Event of Default or otherwise) prior to end of the Closed
Period, Borrower shall pay to Administrative Agent, for the benefit of all
Lenders committed to make Revolving Loans, a fee (the "DEFERRED COMMITMENT FEE")
as compensation for the costs of such Lenders being prepared to make funds
available to Borrower under this Agreement, equal to the greater of: (i) the
Revolving Yield Maintenance Amount and (ii) an amount determined by multiplying
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the Revolving Loan Commitment by three percent (3.0%). No amount will be payable
pursuant to this paragraph if Borrower terminates the Revolving Loan Commitment
after the Closed Period.
(d) Audit Fees. Borrower shall pay to Administrative Agent, for its
own account and not for the benefit of any Lenders, all reasonable fees and
expenses in connection with audits of any Credit Party's books and records,
audits, valuations or appraisals of the Property, which shall be due and payable
on the first Business Day of the month following the date of issuance by
Administrative Agent of a written request for payment thereof to Borrower.
Lenders and Administrative Agent hereby acknowledge and agree that, prior to the
occurrence of any Event of Default, Borrower shall not be obligated to pay any
such fees and expenses for more than two (2) audits with respect to any one
Credit Party in any Fiscal Year.
(e) Wire Fees. Borrower shall pay to Administrative Agent, for its
own account and not for the benefit of any Lenders, on written demand, any and
all fees, costs or expenses which Administrative Agent pays to a bank or other
similar institution (including, without limitation, any fees paid by
Administrative Agent to any other Lender) arising out of or in connection with
(i) the forwarding to Borrower or any other Person on behalf of Borrower, by
Administrative Agent, of proceeds of the Revolving Loans made by any Lender to
Borrower pursuant to this Agreement, and (ii) the depositing for collection, by
Administrative Agent, of any check or item of payment received or delivered to
Administrative Agent on account of the Obligations.
(f) Late Charges. If payments of principal (other than optional
prepayments made by Borrower pursuant to Section 2.2(c) and a final installment
of principal upon the Termination Date), interest due on the Obligations, or any
other amounts due hereunder or under the other Financing Documents are not
timely made and remain overdue for a period of five (5) days, Borrower, without
notice or demand by Administrative Agent, promptly shall pay to Administrative
Agent, for its own account and not for the benefit of any Lenders, as additional
compensation to Administrative Agent in administering the Obligations, an amount
equal to five percent (5%) of each delinquent payment.
(g) Computation of Interest and Related Fees; Payment of Interest.
All interest and fees under each Financing Document shall be calculated on the
basis of a 360-day year for the actual number of days elapsed. The date of
funding of a Revolving Loan shall be included in the calculation of interest.
The date of payment of a Revolving Loan shall be excluded from the calculation
of interest. If a Revolving Loan is repaid on the same day that it is made, one
(1) day's interest shall be charged. Interest on each Revolving Loan is payable
in arrears on the first day of each month and on the maturity of such Revolving
Loan, whether by acceleration or otherwise.
(h) Automated Clearing House Payments. If Administrative Agent so
elects, payments of interest shall be paid to Administrative Agent by Automated
Clearing House debit of immediately available funds from the financial
institution account designated by Borrower in the Automated Clearing House debit
authorization executed by Borrower in connection with this Agreement, and shall
be effective upon receipt. Borrower shall execute any and all forms and
documentation necessary from time to time to effectuate such automatic debiting.
(i) Additional Fees. Borrower shall pay to Administrative Agent, for
its own account and for the benefit of the Lenders, such fees, at such times, as
are set forth in the Agent's Fee Letter.
SECTION 2.4 NOTES.
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The portion of the Revolving Loans made by each Lender shall be
evidenced, if so requested by such Lender, by a promissory note executed by
Borrower (a "NOTE") in an original principal amount equal to such Lender's Pro
Rata Share of the Revolving Loan Commitment.
SECTION 2.5 LETTERS OF CREDIT AND LETTER OF CREDIT FEES.
(a) Letter of Credit. On the terms and subject to the conditions set
forth herein, the Revolving Loan Commitment may be used by Borrower, in addition
to the making of Revolving Loans hereunder, for the issuance, prior to the
Termination Date, by (i) Administrative Agent, of letters of credit, Guarantees
or other agreements or arrangements (each, a "SUPPORT AGREEMENT") to induce an
LC Issuer to issue or increase the amount of, or extend the expiry date of, one
or more Letters of Credit and (ii) a Lender, identified by Administrative Agent,
as an LC Issuer, of one or more Lender Letters of Credit, so long as, in each
case:
(i) Administrative Agent shall have received a Notice of LC
Credit Event at least two (2) Business Days before the relevant date of
issuance, increase or extension; and
(ii) after giving effect to such issuance, increase or
extension, (A) the aggregate Letter of Credit Liabilities under all Letters of
Credit do not exceed (x) $15,000,000 or (y) if the Revolving Loan Commitment has
been increased by an amount equal to $75,000,000 in accordance with Section
2.14, $25,000,000, and (B) the Revolving Loan Outstandings do not exceed the
Revolving Loan Limit.
Nothing in this Agreement shall be construed to obligate any Lender to issue,
increase the amount of or extend the expiry date of any letter of credit, which
act or acts, if any, shall be subject to agreements to be entered into from time
to time between Borrower and such Lender. Each Lender that is an LC Issuer
hereby agrees to give Administrative Agent prompt written notice of each
issuance of a Lender Letter of Credit by such Lender and each payment made by
such Lender in respect of Lender Letters of Credit issued by such Lender.
(b) Letter of Credit Fee. Borrower shall pay to Administrative
Agent, for the benefit of the Revolving Lenders in accordance with their
respective Pro Rata Shares, a letter of credit fee with respect to the Letter of
Credit Liabilities for each Letter of Credit, computed for each day from the
date of issuance of such Letter of Credit to the date that is the last day a
drawing is available under such Letter of Credit, at a rate per annum equal to
the Base Rate Margin then applicable to Revolving Loans. Such fee shall be
payable in arrears on the last day of each calendar month prior to the
Termination Date and on such date. In addition, Borrower agrees to pay promptly
to the LC Issuer any fronting or other fees that it may charge in connection
with any Letter of Credit.
(c) Reimbursement Obligations of Borrower. If either (i)
Administrative Agent shall make a payment to an LC Issuer pursuant to a Support
Agreement, or (ii) any Lender shall honor any draw request under, and make
payment in respect of, a Lender Letter of Credit, (A) Borrower shall reimburse
Administrative Agent or such Lender, as applicable, for the amount of such
payment by the end of the day on which Administrative Agent or such Lender shall
make such payment and (B) Borrower shall be deemed to have immediately requested
that Revolving Lenders make a Revolving Loan, in a principal amount equal to the
amount of such payment (but solely to the extent Borrower shall have failed to
directly reimburse Administrative Agent or, with respect to Lender Letters of
Credit, the applicable LC Issuer, for the amount of such payment).
Administrative Agent shall promptly notify Revolving Lenders of any such deemed
request and each Revolving Lender (other than any such Revolving Lender that was
a Non-Funding Revolving Lender at the time the applicable Supported Letter of
Credit or Lender Letter of Credit was issued) hereby agrees to make available to
Administrative Agent not later than noon (Chicago
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time) on the Business Day following such notification from Administrative Agent
such Revolving Lender's Pro Rata Share of such Revolving Loan. Each Revolving
Lender (other than any applicable Non-Funding Revolving Lender specified above)
hereby absolutely and unconditionally agrees to fund such Revolving Lender's Pro
Rata Share of the Revolving Loan described in the immediately preceding
sentence, unaffected by any circumstance whatsoever, including, without
limitation, (x) the occurrence and continuance of a Default or Event of Default,
(y) the fact that, whether before or after giving effect to the making of any
such Revolving Loan, the Revolving Loan Outstandings exceed or will exceed the
Revolving Loan Limit, and/or (z) the non-satisfaction of any conditions set
forth in Section 7.2. Administrative Agent hereby agrees to apply the gross
proceeds of each Revolving Loan deemed made pursuant to this Section 2.5(c) in
satisfaction of Borrower's reimbursement obligations arising pursuant to this
Section 2.5(c). Borrower shall pay interest, on demand, on all amounts so paid
by Administrative Agent pursuant to any Support Agreement or to any applicable
Lender in honoring a draw request under any Lender Letter of Credit for each day
from the date of such payment until Borrower reimburses Administrative Agent or
the applicable Lender therefore (whether pursuant to clause (A) or (B) of the
first sentence of this subsection (c)) at a rate per annum equal to the sum of
two percent (2%) plus the interest rate applicable to Revolving Loans for such
day.
(d) Reimbursement and Other Payments by Borrower. The obligations of
Borrower to reimburse Administrative Agent and/or the applicable LC Issuer
pursuant to Section 2.5(c) shall be absolute, unconditional and irrevocable, and
shall be performed strictly in accordance with the terms of this Agreement,
under all circumstances whatsoever, including the following:
(i) any lack of validity or enforceability of, or any
amendment or waiver of or any consent to departure from, any Letter of Credit or
any related document;
(ii) the existence of any claim, set-off, defense or other
right which any Credit Party may have at any time against the beneficiary of any
Letter of Credit, the LC Issuer (including any claim for improper payment),
Administrative Agent, any Lender or any other Person, whether in connection with
any Financing Document or any unrelated transaction, provided, however, that
nothing herein shall prevent the assertion of any such claim by separate suit or
compulsory counterclaim;
(iii) any statement or any other document presented under any
Letter of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any respect
whatsoever;
(iv) any affiliation between the LC Issuer and Administrative
Agent; or
(v) to the extent permitted under applicable law, any other
circumstance or happening whatsoever, whether or not similar to any of the
foregoing.
(e) Deposit Obligations of Borrower. In the event any Letters of
Credit are outstanding at the time that Borrower prepays or is required to repay
the Obligations or the Revolving Loan Commitment is terminated, Borrower shall
(i) deposit with Administrative Agent for the benefit of all Revolving Lenders
cash in an amount equal to one hundred and five percent (105%) of the aggregate
outstanding Letter of Credit Liabilities to be available to Administrative
Agent, for its benefit and the benefit of LC Issuers, to reimburse payments of
drafts drawn under such Letters of Credit and pay any fees and expenses related
thereto, and (ii) prepay the fee payable under Section 2.5(b) with respect to
such Letters of Credit for the full remaining terms of such Letters of Credit
assuming that the full amount of such Letters of Credit as of the date of such
repayment or termination remain outstanding until the end of such remaining
terms. Upon termination of any such Letter of Credit and provided no Event of
Default then exists, the unearned portion of such prepaid fee attributable to
such Letter of Credit shall be refunded
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to Borrower, together with the deposit described in the preceding clause (i) to
the extent not previously applied by Administrative Agent in the manner
described herein.
SECTION 2.6 GENERAL PROVISIONS REGARDING PAYMENT; LOAN ACCOUNT.
(a) All payments to be made by Borrower under any Financing
Document, including payments of principal and interest made hereunder and
pursuant to any other Financing Document, and all fees, expenses, indemnities
and reimbursements, shall be made without set-off, recoupment or counterclaim,
in lawful money of the United States and in immediately available funds. If any
payment hereunder becomes due and payable on a day other than a Business Day,
such payment shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension (it being understood and agreed that,
solely for purposes of calculating financial covenants and computations
contained herein and determining compliance therewith, if payment is made, in
full, on any such extended due date, such payment shall be deemed to have been
paid on the original due date without giving effect to any extension thereto).
Any payments received in the Payment Account before noon (Chicago time) on any
Business Day shall be deemed received by Administrative Agent on such Business
Day, and any payments received in the Payment Account after noon (Chicago time)
on any Business Day shall be deemed received by Administrative Agent on the next
succeeding Business Day.
(b) Administrative Agent shall maintain a loan account (the "LOAN
ACCOUNT") on its books to record Revolving Loans and other extensions of credit
made by the Lenders hereunder or under any other Financing Document, and all
payments thereon made by or on behalf of Borrower. 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. The balance in the Loan
Account, as recorded in Administrative Agent's books and records at any time
shall be conclusive and binding evidence of the amounts due and owing to
Administrative Agent by Borrower absent clear and convincing evidence to the
contrary; provided, however, that any failure to so record or any error in so
recording shall not limit or otherwise affect Borrower's duty to pay all amounts
owing hereunder or under any other Financing Document. Administrative Agent
shall endeavor to provide Borrower with a monthly statement regarding the Loan
Account (but neither Administrative Agent nor any Lender shall have any
liability if Administrative Agent shall fail to provide any such statement).
Unless Borrower notifies Administrative Agent of any objection to any such
statement (specifically describing the basis for such objection) within thirty
(30) days after the date of receipt thereof, it shall be deemed final, binding
and conclusive upon Borrower in all respects as to all matters reflected
therein.
SECTION 2.7 MAXIMUM INTEREST.
(a) In no event shall the interest charged with respect to the Notes
(if any) or any other obligations of Borrower under any Financing Document
exceed the maximum amount permitted under the laws of the State of Illinois or
of any other applicable jurisdiction.
(b) Notwithstanding anything to the contrary herein or elsewhere, if
at any time the rate of interest payable hereunder or under any Note or other
Financing Document (the "STATED RATE") would exceed the highest rate of interest
permitted under any applicable law to be charged (the "MAXIMUM LAWFUL RATE"),
then for so long as the Maximum Lawful Rate would be so exceeded, the rate of
interest payable shall be equal to the Maximum Lawful Rate; provided, however,
that if at any time thereafter the Stated Rate is less than the Maximum Lawful
Rate, Borrower shall, to the extent permitted by law, continue to pay interest
at the Maximum Lawful Rate until such time as the total interest received is
equal to the total interest which would have been received had the Stated Rate
been (but for the operation of this provision) the interest rate payable.
Thereafter, the interest rate payable shall be the
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Stated Rate unless and until the Stated Rate again would exceed the Maximum
Lawful Rate, in which event this provision shall again apply.
(c) In no event shall the total interest received by any Lender
exceed the amount which it could lawfully have received had the interest been
calculated for the full term hereof at the Maximum Lawful Rate. If,
notwithstanding the prior sentence, any Lender has received interest hereunder
in excess of the Maximum Lawful Rate, such excess amount shall be applied to the
reduction of the principal balance of the Revolving Loans or to other amounts
(other than interest) payable hereunder, and if no such principal or other
amounts are then outstanding, such excess or part thereof remaining shall be
paid to Borrower.
(d) In computing interest payable with reference to the Maximum
Lawful Rate applicable to any Lender, such interest shall be calculated at a
daily rate equal to the Maximum Lawful Rate divided by the number of days in the
year in which such calculation is made.
SECTION 2.8 TAXES.
(a) All payments of principal and interest on the Revolving Loans
and all other amounts payable hereunder shall be made free and clear of and
without deduction for any present or future income, excise, stamp, documentary,
payroll, employment, property or franchise taxes and other taxes, fees, duties,
levies, assessments, withholdings or other charges of any nature whatsoever
(including interest and penalties thereon) imposed by any taxing authority,
excluding taxes imposed on or measured by Administrative Agent's or any Lender's
net income by the jurisdiction under which Administrative Agent or such Lender
is organized or conducts business (other than solely as the result of entering
into any of the Financing Documents or taking any action thereunder) (all
non-excluded items being called "TAXES"). If any withholding or deduction from
any payment to be made by Borrower hereunder is required in respect of any Taxes
pursuant to any applicable Law, then Borrower will: (i) pay directly to the
relevant authority the full amount required to be so withheld or deducted; (ii)
promptly forward to Administrative Agent an official receipt or other
documentation satisfactory to Administrative Agent evidencing such payment to
such authority; and (iii) pay to Administrative Agent for the account of
Administrative Agent and Lenders such additional amount or amounts as is
necessary to ensure that the net amount actually received by Administrative
Agent and each Lender will equal the full amount Administrative Agent and such
Lender would have received had no such withholding or deduction been required.
If any Taxes are directly asserted against Administrative Agent or any Lender
with respect to any payment received by Administrative Agent or such Lender
hereunder, Administrative Agent or such Lender may pay such Taxes and Borrower
will promptly pay such additional amounts (including any penalty, interest or
expense) as is necessary in order that the net amount received by such Person
after the payment of such Taxes (including any Taxes on such additional amount)
shall equal the amount such Person would have received had such Taxes not been
asserted so long as such amounts have accrued on or after the day which is two
hundred seventy (270) days prior to the date on which Administrative Agent or
such Lender first made written demand therefor.
(b) If Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to Administrative Agent, for the account of
Administrative Agent and the respective Lenders, the required receipts or other
required documentary evidence, Borrower shall indemnify Administrative Agent and
Lenders for any incremental Taxes, interest or penalties that may become payable
by Administrative Agent or any Lender as a result of any such failure.
(c) Each Lender that (i) is organized under the laws of a
jurisdiction other than the United States and (ii)(A) is a party hereto on the
Closing Date or (B) purports to become an assignee of an interest as a Lender
under this Agreement after the Closing Date (unless such Lender was already a
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Lender hereunder immediately prior to such assignment) (each such Lender a
"FOREIGN LENDER") shall execute and deliver to each of Borrower and
Administrative Agent one or more (as Borrower or Administrative Agent may
reasonably request) United States Internal Revenue Service Forms W-8ECI, W-8BEN,
W-8IMY (as applicable) and other applicable forms, certificates or documents
prescribed by the United States Internal Revenue Service or reasonably requested
by Borrower or Administrative Agent certifying as to such Lender's entitlement
to a complete exemption from withholding or deduction of Taxes. Borrower shall
not be required to pay additional amounts to any Lender pursuant to this Section
2.8 with respect to United States withholding and income Taxes to the extent
that the obligation to pay such additional amounts would not have arisen but for
the failure of such Lender to comply with this paragraph other than as a result
of a change in law.
SECTION 2.9 CAPITAL ADEQUACY.
If any Lender shall reasonably determine that the adoption or taking
effect of, or any change in, any applicable Law regarding capital adequacy, in
each instance, after the Closing Date, or any change after the Closing Date in
the interpretation, administration or application thereof by any Governmental
Authority, central bank or comparable agency charged with the interpretation,
administration or application thereof, or the compliance by any Lender or any
Person controlling such Lender with any request, guideline or directive
regarding capital adequacy (whether or not having the force of law) of any such
Governmental Authority, central bank or comparable agency adopted or otherwise
taking effect after the Closing Date, has or would have the effect of reducing
the rate of return on such Lender's or such controlling Person's capital as a
consequence of such Lender's obligations hereunder or under any Support
Agreement or Lender Letter of Credit to a level below that which such Lender or
such controlling Person could have achieved but for such adoption, taking
effect, change, interpretation, administration, application or compliance
(taking into consideration such Lender's or such controlling Person's policies
with respect to capital adequacy), then from time to time, upon written demand
by such Lender (which demand shall be accompanied by a statement setting forth
the basis for such demand and a calculation of the amount thereof in reasonable
detail, a copy of which shall be furnished to Administrative Agent), Borrower
shall promptly pay to such Lender such additional amount as will compensate such
Lender or such controlling Person for such reduction, so long as such amounts
have accrued on or after the day which is two hundred seventy (270) days prior
to the date on which such Lender first made demand therefor.
SECTION 2.10 MITIGATION OBLIGATIONS.
If any Lender requires compensation under Section 2.9, or requires
Borrower to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.8, then, upon the
written request of Borrower, such Lender shall use reasonable efforts to
designate a different lending office for funding or booking its Revolving Loans
hereunder or to assign its rights and obligations hereunder (subject to the
terms of this Agreement) to another of its offices, branches or affiliates, if,
in the judgment of such Lender, such designation or assignment (a) would
eliminate or materially reduce amounts payable pursuant to any such Section, as
the case may be, in the future, and (b) would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such
Lender (as determined in its sole discretion). Without limitation of the
provisions of Section 12.1, Borrower hereby agrees to pay all reasonable costs
and expenses incurred by any Lender in connection with any such designation or
assignment.
SECTION 2.11 RESERVED.
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SECTION 2.12 RESERVE AMOUNTS.
To the extent Administrative Agent is obligated pursuant to Section
2.3(c) to hold as a reserve a portion of any prepayment of Revolving Loans, such
amount may be commingled with general funds of Administrative Agent and no such
sums shall be deemed to be held in trust for the benefit of Borrower. No
interest shall be payable on any funds reserved. All sums so reserved shall be
part of the Property and shall stand as additional security for all of the
Obligations. In the event of any default by Borrower under the terms of this
Agreement or any other Financing Document, Administrative Agent may, at its
discretion, apply amounts on hand in the reserve to cure such default. Upon the
occurrence of an Event of Default and/or maturity of any portion of the
Obligations, the moneys then remaining on deposit with Administrative Agent
shall, at Administrative Agent's option, be applied against the Obligations in
such order and manner as Administrative Agent may elect or as may otherwise be
required under this Agreement. Borrower may, upon written request to
Administrative Agent delivered no later than noon (Chicago time) two (2)
Business Days prior, request Administrative Agent to remit such moneys to
Borrower and Administrative Agent shall cause such moneys to be deposited to
Borrower's Account, provided, that an Event of Default shall not have occurred
and be continuing. Upon the termination of this Agreement and the payment in
full of all Obligations, Administrative Agent shall cause such moneys to be
deposited to Borrower's Account.
SECTION 2.13 RESERVED.
SECTION 2.14 CHANGES IN COMMITMENT.
(a) Borrower shall have the option at any time during the term
hereof, but not more than one time during any period of twelve (12) consecutive
months and provided that no Default or Event of Default has occurred and is
continuing, to request an increase in the Commitment by an amount not to exceed
$75,000,000 (provided that any requested increase in an amount less than
$75,000,000 shall be in multiples of $25,000,000) so that the aggregate of the
Commitment is increased up to $175,000,000 by written notice to Administrative
Agent. Upon receipt of such notice, Administrative Agent shall notify Borrower
of the amount of facility fees to be paid to Administrative Agent and any
Lenders who provide an additional Commitment (the "ADDITIONAL COMMITMENT") in
connection with such increase in the Commitment. If Borrower agrees to pay the
facility fees so determined, then Administrative Agent shall send a notice to
all Lenders (the "ADDITIONAL COMMITMENT REQUEST NOTICE") informing them of
Borrower's request to increase the Commitment and of the facility fees to be
paid with respect thereto. Each Lender who desires in its sole discretion to
provide an Additional Commitment upon such terms shall, not later than seven (7)
Business Days after Administrative Agent sends such notice to all Lenders,
provide Administrative Agent with a written commitment letter specifying the
amount of the Additional Commitment which it is willing to provide. If the
requested increase is oversubscribed then Administrative Agent shall allocate
the increase in the Commitment (the "COMMITMENT INCREASE") among the Lenders who
in their sole discretion provide such commitment letters on such basis as
Administrative Agent shall determine in its sole discretion. If the Additional
Commitments so provided are not sufficient to provide the full amount of the
Commitment Increase requested by Borrower, then Administrative Agent may, but
shall not be obligated to, invite one or more commercial banks or other
financial institutions or investors (the "ELIGIBLE ASSIGNEES") to become a
Lender and provide an Additional Commitment. If Administrative Agent does invite
one or more Eligible Assignees to become a Lender and if following any such
invitation, the amounts committed are still not sufficient to provide the full
amount of the Commitment Increase requested by Borrower, the Commitment Increase
shall be reduced to the aggregate of the amounts committed. Administrative Agent
shall provide all Lenders with a notice setting forth the amount, if any, of the
Additional Commitment to be provided by each Lender and the revised Commitments
of each Lender which shall be applicable after the effective date of the
Commitment Increase specified therein (the "COMMITMENT INCREASE DATE"). The
Commitment Increase
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shall be subject to the receipt by Administrative Agent of each agreement,
document and instrument set forth on the Closing Checklist with respect to the
Commitment Increase, each in form and substance satisfactory to Administrative
Agent.
(b) On the Commitment Increase Date the outstanding principal
balance of the Revolving Loans shall be reallocated among the Lenders such that
after the Commitment Increase Date the outstanding principal amount of Revolving
Loans owed to each Lender shall be equal to such Lender's Commitment (as in
effect after the Commitment Increase Date) of the outstanding principal amount
of all Revolving Loans. On the Commitment Increase Date those Lenders whose
Commitment is increasing shall advance the funds to Administrative Agent and the
funds so advanced shall be distributed among the Lenders whose Commitment is
decreasing as necessary to accomplish the required reallocation of the
outstanding Revolving Loans. On the Commitment Increase Date, the Lenders'
respective interests in outstanding Letters of Credit shall also be adjusted to
reflect the revised Commitment. Upon request from any Lender whose interest in
an outstanding Letter of Credit is so increasing, Borrower shall pay additional
Letter of Credit fees for the amount of such increase at the rate provided in
Section 2.1(b) prorated for the period from the Commitment Increase Date until
the expiration of the applicable Letter of Credit.
(c) Upon the effective date of any increase in the Commitment
pursuant to this Section 2.14, if so requested by a Lender, Borrower shall
execute and deliver to Administrative Agent new Notes for each Lender whose
Commitment has changed so that the maximum principal amount of such Lender's
Note shall equal its Commitment. Administrative Agent shall promptly deliver
such replacement Notes to the respective Lenders in exchange for the Notes
replaced thereby which shall be surrendered by such Lenders. Such new Notes
shall provide that they are replacements for the surrendered Notes and that they
do not constitute a novation, shall be dated as of the Commitment Increase Date
or the effective date of such reduction in the Commitment, as applicable, and
shall otherwise be in substantially the form of the replaced Notes. On the date
of issuance of any new Notes pursuant to this Section 2.14(c), Borrower shall
deliver an opinion of counsel, addressed to the Lenders and Administrative
Agent, relating to the due authorization, execution and delivery of such new
Notes and the enforceability thereof. The surrendered Notes shall be canceled
and returned to Borrower.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
To induce Administrative Agent and Lenders to enter into this
Agreement and to make the Revolving Loans and other credit accommodations
contemplated hereby, Borrower hereby represents and warrants to Administrative
Agent and each Lender that:
SECTION 3.1 EXISTENCE AND POWER.
Each Credit Party is an entity as specified on Schedule 3.1, is duly
organized, validly existing and in good standing under the laws of the
jurisdiction specified on Schedule 3.1, has the same legal name as it appears in
such Credit Party's Organizational Documents and an organizational
identification number (if any), in each case as specified on Schedule 3.1, and
has all powers and all Permits necessary or desirable in the operation of its
business as presently conducted or as proposed to be conducted, except where the
failure to have such Permits could not reasonably be expected to have a Material
Adverse Effect. Each Credit Party is qualified to do business as a foreign
entity in each jurisdiction in which it is required to be so qualified, which
jurisdictions as of the Closing Date are specified on Schedule 3.1, except where
the failure to be so qualified could not reasonably be expected to have a
Material Adverse Effect. Except as set forth on Schedule 3.1, no Credit Party
(a) has had, over the five (5) year period preceding the Closing Date, any name
other than its current name, or (b) was
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incorporated or organized under the laws of any jurisdiction other than its
current jurisdiction of incorporation or organization.
SECTION 3.2 ORGANIZATION AND GOVERNMENTAL AUTHORIZATION; NO CONTRAVENTION.
The execution, delivery and performance by each Credit Party of the
Operative Documents to which it is a party are within its powers, have been duly
authorized by all necessary action pursuant to its Organizational Documents,
require no further action by or in respect of, or filing with, any Governmental
Authority and do not violate, conflict with or cause a breach or a default under
(a) any Law applicable to any Credit Party or any of the Organizational
Documents of any Credit Party, or (b) any agreement or instrument binding upon
it, except for such violations, conflicts, breaches or defaults as could not,
with respect to this clause (b), reasonably be expected to have a Material
Adverse Effect.
SECTION 3.3 BINDING EFFECT.
Each of the Operative Documents to which any Credit Party is a party
constitutes a valid and binding agreement or instrument of such Credit Party,
enforceable against such Credit Party in accordance with its respective terms,
except as the enforceability thereof may be limited by bankruptcy, insolvency or
other similar laws relating to the enforcement of creditors' rights generally
and by general equitable principles.
SECTION 3.4 CAPITALIZATION.
The authorized equity securities of each of the Credit Parties
(other than the Parent REIT) as of the Closing Date is as set forth on Schedule
3.4. All issued and outstanding equity securities of each of such Credit Parties
are duly authorized and validly issued, fully paid, nonassessable, free and
clear of all Liens other than those in favor of Administrative Agent for the
benefit of Administrative Agent and Lenders, and such equity securities were
issued in compliance with all applicable Laws. The identity of the holders of
the equity securities of each of such Credit Parties and the percentage of their
fully-diluted ownership of the equity securities of each of such Credit Parties
as of the Closing Date is set forth on Schedule 3.4. No shares of the capital
stock or other equity securities of any such Credit Party, other than those
described above, are issued and outstanding as of the Closing Date. Except as
set forth on Schedule 3.4, as of the Closing Date there are no preemptive or
other outstanding rights, options, warrants, conversion rights or similar
agreements or understandings for the purchase or acquisition from any such
Credit Party of any equity securities of any such entity.
SECTION 3.5 FINANCIAL INFORMATION.
(a) The consolidated and consolidating balance sheet of the Parent
REIT and its Consolidated Subsidiaries as of December 31, 2004 and the related
consolidated statements of operations, stockholders' equity (or comparable
calculation, if such Person is not a corporation) and cash flows for the Fiscal
Year then ended, reported on by KPMG LLP, copies of which have been delivered to
Administrative Agent, fairly present, in conformity with GAAP, the consolidated
financial position of the Parent REIT and its Consolidated Subsidiaries as of
such date and their consolidated results of operations, changes in stockholders'
equity (or comparable calculation) and cash flows for such period.
(b) The unaudited consolidated balance sheet of the Parent REIT and
its Consolidated Subsidiaries as of June 30, 2005 and the related unaudited
consolidated statements of operations and cash flows for the six (6) months then
ended, copies of which have been delivered to Administrative Agent, fairly
present, in conformity with GAAP applied on a basis consistent with the
financial statements referred to in Section 3.5(a), the consolidated financial
position of the Parent REIT
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and its Consolidated Subsidiaries as of such date and their consolidated results
of operations and cash flows for the six (6) months then ended (subject to
normal year-end adjustments and the absence of footnote disclosures). As of the
date of such balance sheet and the date hereof, no Credit Party had or has any
material liabilities, contingent or otherwise, including liabilities for taxes,
long term leases or forward or long term commitments, which are not properly
reflected on such balance sheet.
(c) The information contained in the most recently delivered
Borrowing Base Certificate is complete and correct.
(d) Since June 30, 2005 there has been no material adverse change in
the business, operations, properties, prospects or condition (financial or
otherwise) of Borrower or the Parent REIT and its Consolidated Subsidiaries,
taken as a whole.
SECTION 3.6 LITIGATION.
Except as set forth on Schedule 3.6 as of the Closing Date, and
except as hereafter disclosed to Administrative Agent in writing, there is no
Litigation pending, or to Borrower's knowledge threatened, against or affecting
any Credit Party or, to Borrower's knowledge, any Property Lessee party to any
Property Lease which, if adversely determined, could reasonably be expected to
have a Material Adverse Effect or which in any manner draws into question the
validity of any of the Operative Documents.
SECTION 3.7 OWNERSHIP OF PROPERTY.
Each Credit Party is the lawful owner of, has good and marketable
title to and is in lawful possession of, or has valid leasehold interests in,
all properties and other assets (real or personal, tangible, intangible or
mixed) purported or reported to be owned or leased (as the case may be) by such
Credit Party. Such properties and assets are subject to no Liens, other than
Permitted Liens.
SECTION 3.8 NO DEFAULT.
No Default or Event of Default has occurred and is continuing. No
Credit Party is in breach or default under or with respect to any contract,
agreement, lease or other instrument to which it is a party or by which its
property is bound or affected, which breach or default could reasonably be
expected to have a Material Adverse Effect.
SECTION 3.9 LABOR MATTERS.
As of the Closing Date, there are no strikes or other labor disputes
pending or, to Borrower's knowledge, threatened against any Credit Party. Hours
worked and payments made to the employees of the Credit Parties have not been in
violation of the Fair Labor Standards Act or any other applicable Law dealing
with such matters. All payments due from the Credit Parties, or for which any
claim may be made against any of them, on account of wages and employee and
retiree health and welfare insurance and other benefits have been paid or
accrued as a liability on their books, as the case may be. The consummation of
the transactions contemplated by the Financing Documents and the other Operative
Documents will not give rise to a right of termination or right of renegotiation
on the part of any union under any collective bargaining agreement to which it
is a party or by which it is bound.
SECTION 3.10 REGULATED ENTITIES.
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No Credit Party is an "investment company" or a company "controlled"
by an "investment company" or a "subsidiary" of an "investment company," all
within the meaning of the Investment Company Act of 1940. No Credit Party is a
"holding company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935.
SECTION 3.11 USE OF PROCEEDS; MARGIN REGULATIONS.
The proceeds of the Revolving Loans shall be used to repay in full
all amounts outstanding under the Existing Agreement, for general working
capital purposes and for such other legal and proper purposes as are consistent
with all applicable laws. None of the proceeds from the Revolving Loans have
been or will be used, directly or indirectly, for the purpose of purchasing or
carrying any Margin Stock, for the purpose of reducing or retiring any
indebtedness which was originally incurred to purchase or carry any Margin Stock
or for any other purpose which might cause any of the Revolving Loans to be
considered a "purpose credit" within the meaning of Regulation T, U or X of the
Board of Governors of the Federal Reserve System.
SECTION 3.12 COMPLIANCE WITH LAWS; ANTI-TERRORISM LAWS.
(a) Each Credit Party is in compliance with the requirements of all
applicable Laws, except for such Laws the noncompliance with which could not
reasonably be expected to have a Material Adverse Effect.
(b) None of the Credit Parties nor, to the knowledge of Borrower,
any of their Affiliates or any of their respective agents acting or benefiting
in any capacity in connection with the transactions contemplated by this
Agreement is (i) in violation of any Anti-Terrorism Law, (ii) engages in or
conspires to engage in any transaction that evades or avoids, or has the purpose
of evading or avoiding, or attempts to violate, any of the prohibitions set
forth in any Anti-Terrorism Law, or (iii) is a Blocked Person. No Credit Party
nor, to the knowledge of Borrower, any of its Affiliates or agents acting or
benefiting in any capacity in connection with the transactions contemplated by
this Agreement, (x) conducts any business or engages in making or receiving any
contribution of funds, goods or services to or for the benefit of any Blocked
Person, or (y) deals in, or otherwise engages in any transaction relating to,
any property or interest in property blocked pursuant to Executive Order No.
13224, any similar executive order or other Anti-Terrorism Law.
SECTION 3.13 TAXES.
All Federal, state and local tax returns, reports and statements
required to be filed by or on behalf of each Credit Party have been filed with
the appropriate Governmental Authorities in all jurisdictions in which such
returns, reports and statements are required to be filed and, except to the
extent subject to a Permitted Contest, all Taxes (including real property Taxes)
and other charges shown to be due and payable in respect thereof have been
timely paid prior to the date on which any fine, penalty, interest, late charge
or loss may be added thereto for nonpayment thereof. Except to the extent
subject to a Permitted Contest, all state and local sales and use Taxes required
to be paid by each Credit Party have been paid. All Federal and state returns
have been filed by each Credit Party for all periods for which returns were due
with respect to employee income tax withholding, social security and
unemployment taxes, and, except to the extent subject to a Permitted Contest,
the amounts shown thereon to be due and payable have been paid in full or
adequate provisions therefor have been made.
SECTION 3.14 COMPLIANCE WITH ERISA.
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(a) Each ERISA Plan (and the related trusts and funding agreements)
complies in form and in operation with, has been administered in compliance
with, and the terms of each ERISA Plan satisfy, the applicable requirements of
ERISA and the Code in all material respects. Each ERISA Plan which is intended
to be qualified under Section 401(a) of the Code is so qualified, and, if
requested by a Credit Party, the United States Internal Revenue Service has
issued a favorable determination letter with respect to each such ERISA Plan
which may be relied on currently. No Credit Party has incurred liability for any
material excise tax under any of Sections 4971 through 5000 of the Code.
(b) During the thirty-six (36) month period prior to the Closing
Date or the making of any Revolving Loan or the issuance of any Letter of
Credit, (i) no steps have been taken to terminate any Pension Plan and (ii) no
contribution failure has occurred with respect to any Pension Plan sufficient to
give rise to a Lien under Section 302(f) of ERISA. No condition exists or event
or transaction has occurred with respect to any Pension Plan which could result
in the incurrence by any Credit Party of any material liability, fine or
penalty. No Credit Party has incurred liability to the PBGC (other than for
current premiums) with respect to any employee Pension Plan. All contributions
(if any) have been made on a timely basis to any Multiemployer Plan that are
required to be made by any Credit Party or any other member of the Controlled
Group under the terms of the plan or of any collective bargaining agreement or
by applicable Law; no Credit Party nor any member of the Controlled Group has
withdrawn or partially withdrawn from any Multiemployer Plan, incurred any
withdrawal liability with respect to any such plan or received notice of any
claim or demand for withdrawal liability or partial withdrawal liability from
any such plan, and no condition has occurred which, if continued, could result
in a withdrawal or partial withdrawal from any such plan, and no Credit Party
nor any member of the Controlled Group has received any notice that any
Multiemployer Plan is in reorganization, that increased contributions may be
required to avoid a reduction in plan benefits or the imposition of any excise
tax, that any such plan is or has been funded at a rate less than that required
under Section 412 of the Code, that any such plan is or may be terminated, or
that any such plan is or may become insolvent.
SECTION 3.15 CONSUMMATION OF OPERATIVE DOCUMENTS; BROKERS.
Except as set forth on Schedule 3.15, and except for fees payable to
Administrative Agent and/or Lenders, no broker, finder or other intermediary has
brought about the obtaining, making or closing of the transactions contemplated
by the Financing Documents, and no Credit Party has or will have any obligation
to any Person in respect of any finder's or brokerage fees, commissions or other
expenses in connection herewith or therewith. All brokerage and finder's fees,
commissions and other expenses payable in connection with the transactions
contemplated by the Financing Documents have been paid in full by Borrower
contemporaneously with the execution of the Financing Documents and the initial
funding of the Revolving Loans. Except for fees payable to Administrative Agent
and/or Lenders, and except as set forth in Schedule 3.15, no broker, finder or
other intermediary has brought about the obtaining, making or closing of the
transactions contemplated by the Financing Documents, and no Credit Party has or
will have any obligation to any Person in respect of any finder's or brokerage
fee in connection herewith or therewith.
SECTION 3.16 RELATED TRANSACTIONS.
All transactions contemplated by the Operative Documents to be
consummated on or prior to the date hereof have been so consummated (including,
without limitation, the disbursement and transfer of all funds in connection
therewith) in all material respects pursuant to the provisions of the applicable
Operative Documents, true and complete copies of which have been delivered to
Administrative Agent, and in compliance with all applicable Law.
SECTION 3.17 MATERIAL CONTRACTS.
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Except for the Operative Documents and the other agreements set
forth on Schedule 3.17 (collectively with the Operative Documents, the "MATERIAL
CONTRACTS"), as of the Closing Date there are no (a) employment agreements
covering the management of any Credit Party, (b) collective bargaining
agreements or other labor agreements covering any employees of any Credit Party,
(c) agreements for managerial, consulting or similar services to which any
Credit Party is a party or by which it is bound, (d) agreements regarding any
Credit Party, its assets or operations or any investment therein to which any of
its equityholders is a party or by which it is bound, (e) real estate leases,
Intellectual Property licenses or other lease or license agreements to which any
Credit Party is a party, either as lessor or lessee, or as licensor or licensee,
or (f) customer, distribution, marketing or supply agreements to which any
Credit Party is a party, in each case with respect to the preceding clauses (a),
(c), (d), (e) and (f) requiring payment of more than $250,000 in any year, (g)
partnership agreements to which any Credit Party is a general partner or joint
venture agreements to which any Credit Party is a party, (h) third party billing
arrangements to which any Credit Party is a party, or (i) any other agreements
or instruments to which any Credit Party is a party, and, in the case of each of
the foregoing clauses (a) through (i), the breach, nonperformance or
cancellation of which, or the failure of which to renew, could reasonably be
expected to have a Material Adverse Effect. Schedule 3.17 sets forth, with
respect to each real estate lease agreement to which any Credit Party is a party
(as a lessee) as of the Closing Date, the address of the subject property and
the annual rental (or, where applicable, a general description of the method of
computing the annual rental). The consummation of the transactions contemplated
by the Financing Documents and the other Operative Documents will not give rise
to a right of termination in favor of any party to any Material Contract (other
than any Credit Party), except for such Material Contracts the termination of
which would not reasonably be expected to have a Material Adverse Effect.
SECTION 3.18 COMPLIANCE WITH ENVIRONMENTAL REQUIREMENTS; NO HAZARDOUS
MATERIALS.
Except in each case as set forth on Schedule 3.18, to the best of
Borrower's knowledge:
(a) no Hazardous Materials are located on any properties now or
previously owned, leased or operated by any Credit Party or have been released
into the environment, or deposited, discharged, placed or disposed of at, on,
under or near any of such properties in a manner that would require the taking
of any action under any Environmental Law and have given rise to, or could
reasonably be expected to give rise to, remediation costs and expenses on the
part of the Credit Parties in excess of $250,000. No portion of any such
property is being used, or has been used at any previous time, for the disposal,
storage, treatment, processing or other handling of Hazardous Materials in
violation of any Environmental Law nor is any such property affected by any
Hazardous Materials Contamination;
(b) no notice, notification, demand, request for information,
citation, summons, complaint or order has been issued, no complaint has been
filed, no penalty has been assessed and no investigation or review is pending,
or to Borrower's knowledge, threatened by any Governmental Authority or other
Person with respect to any (i) alleged violation by any Credit Party of any
Environmental Law, (ii) alleged failure by any Credit Party to have any Permits
required in connection with the conduct of its business or to comply with the
terms and conditions thereof, (iii) any generation, treatment, storage,
recycling, transportation or disposal of any Hazardous Materials, or (iv)
release of Hazardous Materials;
(c) to the knowledge of Borrower, all oral or written notifications
of a release of Hazardous Materials required to be filed by or on behalf of any
Credit Party under any applicable Environmental Law have been filed or are in
the process of being timely filed by or on behalf of the applicable Credit
Party;
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(d) no property now owned or leased by any Credit Party and, to the
knowledge of Borrower, no such property previously owned or leased by any Credit
Party, to which any Credit Party has, directly or indirectly, transported or
arranged for the transportation of any Hazardous Materials, is listed or, to
Borrower's knowledge, proposed for listing, on the National Priorities List
promulgated pursuant to CERCLA, or CERCLIS (as defined in CERCLA) or any similar
state list or is the subject of Federal, state or local enforcement actions or,
to the knowledge of Borrower, other investigations which may lead to claims
against any Credit Party for clean-up costs, remedial work, damage to natural
resources or personal injury claims, including, without limitation, claims under
CERCLA;
(e) there are no underground storage tanks located on any property
owned or leased by any Credit Party that are not properly registered or
permitted under applicable Environmental Laws or that are leaking or disposing
of Hazardous Materials; and
(f) there are no Liens under or pursuant to any applicable
Environmental Laws on any real property or other assets owned or leased by any
Credit Party, and no actions by any Governmental Authority have been taken or,
to the knowledge of Borrower, threatened, which could subject any of such
properties or assets to such Liens.
For purposes of this Section 3.18, each Credit Party shall be deemed to include
any business or business entity (including a corporation) that is, in whole or
in part, a predecessor of such Credit Party.
SECTION 3.19 INTELLECTUAL PROPERTY.
Each Credit Party owns, is licensed to use or otherwise has the
right to use, all Intellectual Property that is material to the condition
(financial or other), business or operations of such Credit Party. All such
Intellectual Property existing as of the Closing Date and registered with any
United States or foreign Governmental Authority is set forth on Schedule 3.19.
All Intellectual Property of each Credit Party is fully protected and/or duly
and properly registered, filed or issued in the appropriate office and
jurisdictions for such registrations, filings or issuances. To Borrower's
knowledge, each Credit Party conducts its business without infringement or claim
of infringement of any Intellectual Property rights of others and there is no
infringement or claim of infringement by others of any Intellectual Property
rights of any Credit Party, which infringement or claim of infringement could
reasonably be expected to have a Material Adverse Effect.
SECTION 3.20 REAL PROPERTY INTERESTS.
Except for leasehold interests disclosed on Schedule 3.20, and
except for the ownership or other interests set forth on Schedule 3.20, no
Credit Party has, as of the Closing Date, any ownership, leasehold or other
interest in real property. Schedule 3.20 sets forth, with respect to each parcel
of real estate owned by any Credit Party as of the Closing Date, the address and
legal description of such parcel.
SECTION 3.21 SOLVENCY.
Each Credit Party is Solvent.
SECTION 3.22 FULL DISCLOSURE.
None of the information (financial or otherwise) furnished by or on
behalf of any Credit Party to Administrative Agent or any Lender in connection
with the consummation of the transactions contemplated by the Financing
Documents, contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained herein or therein not
misleading in light
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of the circumstances under which such statements were made. All financial
projections delivered to Administrative Agent and the Lenders by any Credit
Party (or its agents) have been prepared on the basis of the assumptions stated
therein. Such projections represent each Credit Party's best estimate of such
Credit Party's future financial performance and such assumptions are believed by
such Credit Party to be fair and reasonable in light of current business
conditions; provided, however, that Borrower can give no assurance that such
projections will be attained.
SECTION 3.23 INTEREST RATE.
The rate of interest paid under the Notes and the method and manner
of the calculation thereof do not violate any usury or other law or applicable
Laws, any of the Organizational Documents or any of the Operative Documents.
SECTION 3.24 REPRESENTATIONS AND WARRANTIES INCORPORATED FROM OPERATIVE
DOCUMENTS.
As of the Closing Date, each of the representations and warranties
made in the Operative Documents by each of the Credit Parties party thereto is
true and correct in all material respects, and such representations and
warranties are hereby incorporated herein by reference with the same effect as
though set forth in their entirety herein, as qualified therein, except to the
extent that such representation or warranty relates to a specific date, in which
case such representation and warranty shall be true as of such earlier date.
ARTICLE 4
AFFIRMATIVE COVENANTS
Borrower agrees that, so long as any Credit Exposure exists:
SECTION 4.1 FINANCIAL STATEMENTS AND OTHER REPORTS.
(a) Borrower shall, and shall cause each other Credit Party to,
maintain a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
accordance with GAAP and to provide the information required to be delivered to
Administrative Agent and the Lenders hereunder.
(b) Borrower shall furnish to Administrative Agent (or cause to be
furnished to Administrative Agent) the following financial information and
reports in each case, in form and format and providing information satisfactory
to Administrative Agent in its discretion:
(i) within forty-five (45) days of the end of each calendar
quarter (other than a calendar quarter which is also the end of a Fiscal Year),
unaudited consolidated quarterly financial statements (including a balance
sheet, an income statement and a statement of cash flows) of the Parent REIT and
its Consolidated Subsidiaries (including Borrower), in comparison to the same
quarter and year-to-date for the prior Fiscal Year, and certified by a
Responsible Officer of the Parent REIT;
(ii) within ninety (90) days after the end of each Fiscal
Year, audited annual financial statements (including a balance sheet, an income
statement and a statement of cash flows) of the Parent REIT and its Consolidated
Subsidiaries on a consolidated basis;
(iii) with each of the financial statements furnished to
Administrative Agent pursuant to subsections (i) and (ii) hereof, a Compliance
Certificate in the form attached, including the calculations supporting the
statements contained therein;
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(iv) promptly after the sending or filing thereof, copies of
each financial statement, report, notice or proxy statement sent by the Parent
REIT or any Subsidiary to its stockholders or other equity holders, and copies
of each regular, periodic or special report, registration statement or
prospectus (including all Form 10-K, Form 10-Q and Form 8-K reports) filed by
the Parent REIT or any Subsidiary with any securities exchange or the Securities
and Exchange Commission or any successor agency;
(v) as soon as available, an in any event within thirty (30)
days after the end of each Fiscal Year of the Parent REIT, a copy of the Parent
REIT's consolidated projections of revenues, expenses and balance sheet on a
quarter-by-quarter basis, with such projections in reasonable detail prepared by
the Parent REIT and in form satisfactory to Administrative Agent (which shall
include a summary of all significant assumptions made in preparing such business
plan);
(vi) promptly upon receipt thereof, copies of any reports by
the independent accountants in connection with any audit;
(vii) within fifteen (15) days after timely filing thereof,
the annual federal income tax returns with all schedules and exhibits thereto of
Borrower and the Parent REIT; and
(viii) such additional information, reports or statements
regarding the Credit Parties as Administrative Agent may from time to time
reasonably request.
The financial statements furnished to Administrative Agent pursuant
to subsections (i) and (ii) hereof shall fairly represent the financial
condition of the Parent REIT and its Consolidated Subsidiaries, shall be
prepared in accordance with GAAP (except that quarterly financial statements
shall not have footnotes and shall be subject to normal year end adjustments)
and, with respect to annual financial statements, shall be audited by KPMG or
such other independent certified public accountant reasonably acceptable to
Administrative Agent.
(c) As soon as available and in any event within thirty (30) days
after the end of each calendar quarter, and from time to time upon the
reasonable request of Administrative Agent, Borrower shall deliver to
Administrative Agent a Borrowing Base Certificate as of the most recent
Borrowing Base Determination Date, together with such reconciliation reports as
may be reasonably requested by Administrative Agent with respect to the
components of such Borrowing Base Certificate. Within ten (10) Business Days
after any request therefor, Borrower shall deliver to Administrative Agent such
information in such detail concerning the amount, composition and manner of
calculation of the Borrowing Base as Administrative Agent may reasonably
request.
(d) At any time while and so long as an Event of Default shall be
continuing, Borrower shall deliver to Administrative Agent a report of KPMG or
other independent auditor reasonably satisfactory to Administrative Agent (which
may be, or be affiliated with, a Lender) with respect to the components of the
Borrowing Base, which report shall indicate whether or not the information set
forth in the Borrowing Base Certificate most recently delivered is accurate and
complete in all material respects based upon a review by such auditor of the
components included in calculation of the Borrowing Base.
(e) From time to time, if Administrative Agent determines that
obtaining Appraisals is necessary in order for a Lender to comply with
applicable Laws, Borrower shall furnish to Administrative Agent Appraisals in
form and substance and from appraisers reasonably satisfactory to Administrative
Agent stating the then current fair market values of all or any portion of the
Properties owned by each Credit Party. In addition to the foregoing,
Administrative Agent may, from time to time,
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but no more than once during each calendar year, require Borrower to obtain and
deliver to Administrative Agent Appraisals in form and substance reasonably
satisfactory to Administrative Agent stating the then current fair market values
of all or any portion of the Properties owned by each Credit Party. In addition
to the foregoing, Borrower may, from time to time, but no more than once during
each calendar year, upon request to Administrative Agent and at Borrower's sole
expense, obtain and deliver to Administrative Agent Appraisals in form and
substance reasonably satisfactory to Administrative Agent stating the then
current fair market values of all or any portion of the Properties owned by each
Credit Party.
(f) Promptly upon receipt or filing thereof, Borrower shall, and
shall cause each Credit Party to, deliver to Administrative Agent copies of any
reports or notices related to any material taxes and any other material reports
or notices received by any Credit Party from, or filed by any Credit Party with,
any Governmental Authority.
SECTION 4.2 PAYMENT AND PERFORMANCE OF OBLIGATIONS.
Borrower shall, and shall cause each other Credit Party to, pay and
discharge, at or before maturity (subject to applicable grace or cure periods),
all of its obligations and liabilities under the Financing Documents. Borrower
shall, and shall cause each other Credit Party to, (a) pay and discharge at or
before maturity, all of their respective obligations and liabilities, including
tax liabilities, except for such obligations and/or liabilities (i) that may be
the subject of a Permitted Contest, and (ii) the nonpayment or nondischarge of
which could not reasonably be expected to have a Material Adverse Effect, (b)
maintain, in accordance with GAAP, appropriate reserves for the accrual of all
of its obligations and liabilities, and (c) not breach, or permit to exist any
default under, the terms of any lease, commitment, contract, instrument or
obligation to which it is a party, or by which its properties or assets are
bound, except for such breaches or defaults which could not reasonably be
expected to have a Material Adverse Effect.
SECTION 4.3 MAINTENANCE OF EXISTENCE; SINGLE PURPOSE ENTITY REQUIREMENTS.
(a) Borrower shall, and shall cause each other Credit Party to
preserve, renew and keep in full force and effect its existence and its rights,
privileges and franchises necessary or desirable in the normal conduct of
business.
(b) Borrower shall cause each Restricted Subsidiary and Material
Subsidiary at all times to comply with all Single Purpose Entity Requirements.
(c) Borrower shall cause the Parent REIT at all times to preserve
its status as a REIT.
SECTION 4.4 MAINTENANCE OF PROPERTY; PAYMENT OF TAXES; INSURANCE.
(a) Borrower shall, and shall cause each other Credit Party to, keep
all property useful and necessary in its business in good working order and
condition, ordinary wear and tear excepted. If all or any part of the Collateral
becomes damaged or destroyed, Borrower shall, or shall cause the applicable
Credit Party to, promptly and completely repair and/or restore the affected
Collateral in a good and workmanlike manner, regardless of whether
Administrative Agent agrees to disburse insurance proceeds or other sums to pay
costs of the work of repair or reconstruction. Borrower shall not, and shall not
permit any Credit Party to, commit or allow waste or permit impairment or
deterioration of the Collateral or abandon all or any part of the Collateral.
Borrower shall, and shall cause each other Credit Party to, perform such acts to
preserve the value of the Collateral. Borrower shall, and shall cause each other
Credit Party to, (i) preserve its interest in and title to the Collateral and
will forever warrant
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and defend the same against any and all claims made by, through or under a
Credit Party or its Subsidiaries, and (ii) forever warrant and defend the
validity and priority of the lien and security interest created in the Security
Documents against the claims of all Persons whomsoever claiming by, through or
under a Credit Party or its Subsidiaries. The foregoing warranty of title shall
survive the foreclosure of the Security Documents and shall inure to the benefit
of and be enforceable by Administrative Agent in the event Administrative Agent
acquires title to any Collateral pursuant to any foreclosure.
(b) Borrower shall, and shall cause each other Credit Party to, pay
or cause to be paid all Taxes at least five (5) days (thirty (30) days in the
case of Taxes assessed on Property constituting any portion of the Collateral)
prior to the date upon which any fine, penalty, interest or cost for nonpayment
is imposed, and furnish to Administrative Agent, upon request, receipted bills
of the appropriate taxing authority or other documentation reasonably
satisfactory to Administrative Agent evidencing the payment thereof. If Borrower
or any Credit Party shall fail to pay any Taxes in accordance with this Section
4.4(b) and is not contesting or causing a contesting of such Taxes pursuant to a
Permitted Contest, Administrative Agent shall have the right, but shall not be
obligated, to (for the account of all Lenders) pay such Taxes, and Borrower
shall repay to Administrative Agent, on written demand, any amount paid by
Administrative Agent, with interest thereon from the date of the advance thereof
to the date of repayment, at the rate applicable during periods of Default
hereunder, and such amount shall constitute a portion of the Obligations.
Borrower shall not, and shall not permit any other Credit Party, to pay any
Taxes or other obligations in installments unless permitted by applicable Laws,
and shall, upon the request of Administrative Agent, deliver copies of all
notices and bills relating to any Taxes or other charge covered by this Section
to Administrative Agent.
(c) Upon completion of any Permitted Contest, Borrower shall, or
shall cause the applicable Credit Party to, immediately pay the amount due, if
any, and deliver to Administrative Agent proof of the completion of the contest
and payment of the amount due, if any, following which Administrative Agent
shall return the security, if any, deposited with Lender pursuant to the
definition of Permitted Contest.
(d) Borrower shall, and shall cause each other Credit Party to,
maintain (i) casualty insurance on all real and personal property on an all
risks basis (including the perils of flood and quake), covering the repair and
replacement cost of all such property and coverage for business interruption,
rent loss, professional liability and public liability insurance (including
products/completed operations liability coverage) in each case of the kind and
meeting the minimum requirements set forth in Exhibit I, and (ii) such other
insurance coverage in such amounts and with respect to such risks as
Administrative Agent may reasonably request; provided, however, that, in no
event shall such insurance be in amounts or with coverage less than, or with
carriers with qualifications inferior to, any of the insurance or carriers in
existence as of the Closing Date (or required to be in existence after the
Closing Date under a Financing Document). All such insurance shall be provided
by insurers having an A.M. Best policyholders rating reasonably acceptable to
Administrative Agent. Borrower shall not, and shall not permit any other Credit
Party to, bring or keep any article on any business location of Borrower or any
other Credit Party, or cause or allow any condition to exist, if the presence of
such article or the occurrence of such condition could reasonably cause the
invalidation of any insurance required by this Section 4.4(d) or Exhibit I, or
would otherwise be prohibited by the terms thereof.
(e) Borrower shall, and shall cause each other Credit Party to,
deliver to Administrative Agent and the Lenders (i) upon the request of any
Lender through Administrative Agent from time to time full information as to the
insurance carried, (ii) within five (5) days of receipt of notice from any
insurer, a copy of any notice of cancellation, nonrenewal or material change in
coverage from that existing on the date of this Agreement, and (iii) forthwith,
notice of any cancellation or nonrenewal of coverage by Borrower or any other
Credit Party.
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(f) In the event Borrower or any other Credit Party fails to provide
Administrative Agent with evidence of the insurance coverage required by this
Agreement, Administrative Agent may purchase insurance at Borrower's expense to
protect Administrative Agent's interests in the Collateral. This insurance may,
but need not, protect any Credit Party's interests. The coverage purchased by
Administrative Agent may not pay any claim made by any Credit Party or any claim
that is made against any Credit Party in connection with the Collateral. The
applicable Credit Party may later cancel any insurance purchased by
Administrative Agent, but only after providing Administrative Agent with
evidence that such Credit Party has obtained insurance as required by this
Agreement. If Administrative Agent purchases insurance for the Collateral, to
the fullest extent provided by law Borrower will be responsible for the costs of
that insurance, including interest and other charges imposed by Administrative
Agent in connection with the placement of the insurance, until the effective
date of the cancellation or expiration of the insurance. The costs of the
insurance may be added to the Obligations. The costs of the insurance may be
more than the cost of insurance Borrower or any other Credit Party is able to
obtain on its own.
(g) If any insurance proceeds are paid by check, draft or other
instrument payable to a Credit Party and Administrative Agent jointly, Borrower
authorizes Administrative Agent to endorse Borrower's or such other Credit
Party's, as applicable, name thereon and do such other things as Administrative
Agent may deem advisable to reduce the same to cash. Borrower shall not, and
shall not permit any other Credit Party to, carry separate insurance concurrent
in form or contributing in the event of loss with that required to be maintained
under this Section. Borrower shall, and shall cause each other Credit Party to,
promptly notify Administrative Agent of any loss, damage, or destruction to any
Collateral, whether or not covered by insurance. Administrative Agent is hereby
authorized to collect all insurance proceeds in respect of Collateral directly
and to apply the same to the Obligations whether or not then due and payable;
provided, however, that, if the proceeds of any casualty event involving loss,
damage or destruction of the Collateral shall be less than $250,000,
Administrative Agent shall distribute such insurance proceeds to Borrower and
Borrower shall and hereby covenants to use such proceeds to repair or replace
such Collateral. Administrative Agent is authorized and empowered, and Borrower
hereby irrevocably appoints Administrative Agent as its attorney-in-fact (such
appointment is coupled with an interest), at Administrative Agent's option, to
make or file proofs of loss or damage and to settle and adjust any claim under
insurance policies which insure against such risks, or to direct the Credit
Parties, in writing, to agree with the insurance carrier(s) on the amount to be
paid in regard to such loss.
(h) Notwithstanding the foregoing provisions of this Section 4.4, if
a Property Lessee is required by the terms of the applicable Property Lease to
make the payments or perform the obligations assigned to Borrower or a Credit
Party pursuant to this Section 4.4, neither Borrower nor the Credit Parties
shall be obligated to make such payments or perform such obligations, as the
case may be, unless such Property Lessee shall have failed to make such payments
or perform such obligations, as the case may be.
SECTION 4.5 COMPLIANCE WITH LAWS.
Borrower shall, and shall cause each other Credit Party to, comply
with the requirements of all applicable Laws, except to the extent that failure
to so comply could not reasonably be expected to (a) have a Material Adverse
Effect, or (b) result in any Lien upon a material portion of the Collateral in
favor of any Governmental Authority.
SECTION 4.6 INSPECTION OF PROPERTY, BOOKS AND RECORDS.
Borrower shall, and shall cause each other Credit Party to, keep
proper books of record and account in accordance with GAAP in which full, true
and correct entries shall be made of all dealings
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and transactions in relation to its business and activities. Borrower shall
permit, and shall cause each other Credit Party to permit, at the sole cost of
Borrower, representatives of Administrative Agent and of any Lender (but at such
Lender's expense unless such visit or inspection is made concurrently with
Administrative Agent), subject to the terms of the applicable Property Lease,
with respect to each Eligible Property and any Property to be included in the
calculation of the Borrowing Base prior to such inclusion, to visit and inspect
any of their respective properties, to examine and make abstracts or copies from
any of their respective books and records, to conduct a Property audit and
analysis of their respective operations and Property and to discuss their
respective affairs, finances and accounts with their respective officers,
employees and independent public accountants as often as may reasonably be
desired. In the absence of an Event of Default, Administrative Agent or any
Lender exercising any rights pursuant to this Section 4.6 shall give Borrower or
any applicable Credit Party commercially reasonable prior notice of such
exercise. No notice shall be required during the existence and continuance of
any Event of Default. Borrower shall cause each other Credit Party to cause each
Property Lessee to permit, at the sole cost of Borrower, representatives of
Administrative Agent and of any Lender (but at such Lender's expense unless such
visit or inspection is made concurrently with Administrative Agent), with
respect to each Eligible Property included in the calculation of the Borrowing
Base as of the most recent Borrowing Base Determination Date (other than an
Eligible Property included in the calculation of the Borrowing Base as of the
Closing Date) and any Property to be included in the calculation of the
Borrowing Base prior to such inclusion, to examine and make abstracts or copies
from such Property Lessee's books and records and to discuss such Property
Lessee's affairs, finances and accounts with its respective officers, employees
and independent public accountants as often as may reasonably be desired.
SECTION 4.7 USE OF PROCEEDS.
Borrower will use the proceeds of the initial Revolving Loans solely
for payment of amounts due in respect of transaction fees incurred in connection
with the Operative Documents and the refinancing on the Closing Date of Debt.
The proceeds of Revolving Loans shall be used by Borrower solely for the
purposes set forth in the preceding sentence and for working capital needs of
Borrower and the other Credit Parties. No portion of the proceeds of the
Revolving Loans will be used for family, personal, agricultural or household
use.
SECTION 4.8 LENDERS' MEETINGS.
Within fifteen (15) days after the delivery to Administrative Agent
and Lenders of financial statements pursuant to Sections 4.1(b), Borrower will,
to the extent requested by either Administrative Agent or Required Lenders,
conduct a meeting of Administrative Agent and the Lenders to discuss the most
recently reported financial results and the financial condition of the Parent
REIT and its Consolidated Subsidiaries, at which shall be present a Responsible
Officer and such other officers of the Credit Parties as may be reasonably
requested to attend by Administrative Agent or any Lender, such request or
requests to be made within a reasonable time prior to the scheduled date of such
meeting. Such meetings shall be held at a time and place convenient to the
Lenders and to the Credit Parties and may be conducted by telephone.
SECTION 4.9 ERISA.
Borrower shall, and shall cause each other Credit Party and each
Subsidiary of Borrower or any other Credit Party to, promptly pay and discharge
all obligations and liabilities arising under ERISA of a character which if
unpaid or unperformed could reasonably be expected to result in the imposition
of a Lien against any Collateral. Borrower shall promptly notify Administrative
Agent and each Lender of: (a) the occurrence of any reportable event (as defined
in ERISA) with respect to a Pension Plan, (b) receipt of any notice by Borrower,
any other Credit Party or any Subsidiary of Borrower
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or of any other Credit Party from the PBGC of its intention to seek termination
of any Pension Plan or appointment of a trustee therefore, (c) the intention of
Borrower, any other Credit Party or any Subsidiary of Borrower or of any other
Credit Party to terminate or withdraw from any Pension Plan, and (d) the
occurrence of any event with respect to any Pension Plan which would result in
the incurrence by Borrower, any other Credit Party or any Subsidiary of Borrower
or of any other Credit Party of any material liability, fine or penalty, or any
material increase in the contingent liability of Borrower, any other Credit
Party or any Subsidiary of Borrower or of any other Credit Party with respect to
any post-retirement Welfare Plan benefit.
SECTION 4.10 HAZARDOUS MATERIALS; REMEDIATION.
(a) If any release or disposal of Hazardous Materials shall occur or
shall have occurred on any Property, Borrower shall cause, or shall direct the
applicable Restricted Subsidiary to cause, the prompt containment and removal of
such Hazardous Materials and the remediation of such Property as is necessary to
comply with all Environmental Laws and to preserve the value of such Property.
Borrower shall give prompt written notice to Administrative Agent of such
release or disposal of Hazardous Materials and the actions Borrower or the
applicable Restricted Subsidiary, as the case may be, proposes to take with
respect thereto. Without limiting the generality of the foregoing, Borrower
shall, and shall cause each Restricted Subsidiary to, comply with each
Environmental Law requiring the performance at any Property by Borrower or such
Restricted Subsidiary of activities in response to the release or threatened
release of a Hazardous Material.
(b) Borrower will provide Administrative Agent within thirty (30)
days after written demand therefor with a bond, letter of credit or similar
financial assurance evidencing to the reasonable satisfaction of Administrative
Agent that sufficient funds are available to pay the cost of removing, treating
and disposing of any Hazardous Materials or Hazardous Materials Contamination
and discharging any assessment which may be established on any Property as a
result thereof, such demand to be made, if at all, upon Administrative Agent's
reasonable business determination that the failure to remove, treat or dispose
of any Hazardous Materials or Hazardous Materials Contamination, or the failure
to discharge any such assessment could reasonably be expected to have a Material
Adverse Effect.
(c) Notwithstanding the foregoing, if a Property Lessee is required
by the terms of the applicable Property Lease to perform the obligations
described in paragraphs (a) and (b) above, neither Borrower nor the Credit
Parties shall be obligated to perform such obligations unless such Property
Lessee shall have failed to perform such obligations.
SECTION 4.11 NEW GUARANTORS.
Upon the acquisition, incorporation or other creation of any direct
or indirect Material Subsidiary which owns or is to own an Eligible Property to
be included in the calculation of the Borrowing Base, Borrower shall (i) cause
such Material Subsidiary to become a Guarantor through execution and delivery to
Administrative Agent of a Financing Documents Guarantee, in form, content and
scope reasonably satisfactory to Administrative Agent, on or before the date on
which such Eligible Property is included in any calculation (pro forma or
otherwise) of the Borrowing Base, (ii) cause such Material Subsidiary to deliver
such other documentation as Administrative Agent may reasonably request in
connection with the foregoing, including, without limitation, such agreements
and other documents required pursuant to Section 7.4(c), certified resolutions
and other organizational and authorizing documents of such Material Subsidiary,
favorable opinions of counsel to such Material Subsidiary (which shall cover,
among other things, the legality, validity, binding effect and enforceability of
the documentation referred to above), all in form, content and scope reasonably
satisfactory to Administrative
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Agent, and (iii) deliver to Administrative Agent updated exhibits and schedules,
to the extent necessary, to each Financing Document.
SECTION 4.12 FURTHER ASSURANCES.
(a) Borrower shall, and shall cause each other Credit Party to,
cause, at Borrower's own cost and expense, to be promptly and duly taken,
executed, acknowledged and delivered all such further acts, documents and
assurances as may from time to time be necessary or as Administrative Agent or
the Required Lenders may from time to time request in order to carry out the
intent and purposes of the Financing Documents and the transactions contemplated
thereby, including all such actions to establish, create, preserve, protect and
perfect a first priority Lien (subject only to Permitted Liens) in favor of
Administrative Agent for the benefit of the Lenders on the Collateral (including
Collateral acquired after the date hereof), including on any and all assets of
each Credit Party, whether now owned or hereafter acquired.
(b) Upon receipt of an affidavit of an officer of Administrative
Agent or a Lender as to the loss, theft, destruction or mutilation of any Note
or any other Financing Document which is not of public record, and, in the case
of any such mutilation, upon surrender and cancellation of such Note or other
applicable Financing Document, Borrower will issue, in lieu thereof, a
replacement Note or other applicable Financing Document, dated the date of such
lost, stolen, destroyed or mutilated Note or other Financing Document in the
same principal amount thereof and otherwise of like tenor.
SECTION 4.13 LITIGATION.
Borrower will give prompt written notice to Administrative Agent of
any litigation or governmental proceedings pending or threatened (in writing)
against Borrower or any other Credit Party which could have a Material Adverse
Effect.
SECTION 4.14 UPDATES OF REPRESENTATIONS.
Borrower shall deliver to Administrative Agent within ten (10) days
of the written request of Administrative Agent an Officer's Certificate updating
all of the representations and warranties contained in this Agreement and the
other Financing Documents and certifying that all of the representations and
warranties contained in this Agreement and the other Financing Documents, as
updated pursuant to such Officer's Certificate, are true, accurate and complete
as of the date of such Officer's Certificate.
SECTION 4.15 POWER OF ATTORNEY.
Each of the officers of Administrative Agent is hereby irrevocably
made, constituted and appointed the true and lawful attorney for the Credit
Parties (without requiring any of them to act as such) with full power of
substitution to do the following: (a) endorse the name of a Credit Party upon
any and all checks, drafts, money orders and other instruments for the payment
of money that are payable to such Credit Party and constitute rental payments
under a Property Lease, refunds of real estate Taxes or other income or proceeds
of the Collateral; (b) the execute in the name of a Credit Party any financing
statements, schedules, assignments, instruments, documents, and statements that
such Credit Party is obligated to give Administrative Agent under this Agreement
or any other Financing Document; (c) after the occurrence and during the
continuance of a Default, take any action a Credit Party is required to take
under this Agreement or any other Operative Document; and (d) do such other and
further acts and deeds in the name of such Credit Party that Administrative
Agent may deem necessary or desirable to enforce
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any Property Lease or perfect Administrative Agent's security interest or Lien
in any Collateral. This power of attorney shall be irrevocable and coupled with
an interest.
SECTION 4.16 ESTOPPEL CERTIFICATES.
After written request by Administrative Agent, which, absent an
Event of Default shall not be more than once during any calendar year, Borrower
shall, within fifteen (15) days and at Borrower's expense, furnish
Administrative Agent with a statement, duly acknowledged and certified, setting
forth (a) any offsets or defenses to the payment of the Obligations, and if any
are alleged, the nature thereof, (b) that none of the Operative Documents have
been modified or if modified, giving particulars of such modification, and (c)
that there has occurred and is then continuing no Default or if such Default
exists, the nature thereof, the period of time it has existed, and the action
being taken to remedy such Default.
SECTION 4.17 BORROWING BASE COLLATERAL ADMINISTRATION.
(a) Borrower shall, and shall cause each Restricted Subsidiary to,
keep all data and other information relating to Property Leases or other
intangible Collateral at all times at their respective principal offices and
Borrower shall not, and shall cause each Restricted Subsidiary not to, move such
data and other information from such locations without (i) providing prior
written notice to Administrative Agent, and (ii) obtaining the prior written
consent of Administrative Agent, which consent shall not be unreasonably
withheld.
(b) Whether or not an Event of Default has occurred, any of
Administrative Agent's officers, employees or agents shall, upon prior written
notice to Borrower, have the right, at any time or times hereafter, in the name
of Administrative Agent or any designee of Administrative Agent or any Credit
Party, to verify the validity, amount or any other matter relating to any
Property Leases by mail, telephone, telegraph or otherwise, including, without
limitation, verification of a Credit Party's compliance with applicable Laws.
Borrower shall and shall cause each Credit Party to cooperate fully with
Administrative Agent in an effort to facilitate and promptly conclude such
verification process. Notwithstanding the foregoing, Administrative Agent shall
obtain Borrower's prior written consent, which consent shall not be unreasonably
withheld or delayed, with respect to any such verification that shall include
contact with applicable federal, state and local regulatory authorities having
jurisdiction over the Borrower's or any Credit Party's affairs; provided, that
any contact with such regulatory authorities shall be carried out jointly by
Borrower and Administrative Agent; provided however, that if Borrower fails to
provide such consent within ten (10) Business Days of the date of receipt of
notice from Administrative Agent, or if Borrower shall fail to cooperate with
Administrative Agent to contact such regulatory authorities, the applicable
Property shall cease to be included in the calculation of the Borrowing Base.
(c) To expedite collection, Borrower shall endeavor in the first
instance to make collection of payments due under Property Leases for
Administrative Agent. Administrative Agent shall have the right at any time to
notify Property Lessees that Administrative Agent has been granted a Lien upon
all Property Leases, that Property Leases have been assigned to Administrative
Agent and, following the occurrence of a Default, that payment of amounts under
such Property Leases shall be made directly by such Property Lessees to
Administrative Agent (and once such notice has been given to a Property Lessee,
Borrower shall not, and shall cause each other Credit Party not to, give any
contrary instructions to such Property Lessees without Administrative Agent's
prior written consent).
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ARTICLE 5
NEGATIVE COVENANTS
Borrower agrees that, so long as any Credit Exposure exists:
SECTION 5.1 DEBT.
Borrower shall cause each Restricted Subsidiary not to, directly or
indirectly, create, incur, assume, guarantee or otherwise become or remain
directly or indirectly liable with respect to, any Debt, except for: (a) Debt
under Material Contracts, including the Financing Documents; (b) intercompany
Debt arising from loans made by such Restricted Subsidiary to a Credit Party,
provided, however, that upon the request of Administrative Agent at any time,
any such Debt shall be evidenced by promissory notes having terms reasonably
satisfactory to Administrative Agent, the sole originally executed counterparts
of which shall be pledged and delivered to Administrative Agent, for the benefit
of Administrative Agent and Lenders, as security for the Obligations; (c)
unsecured Debt in the form of trade payables aged in a manner consistent with
such Restricted Subsidiary's past practices and not to exceed $500,000 in the
aggregate at any time outstanding; and (d) Debt incurred or assumed for the
purpose of financing all or any part of the cost of acquiring any equipment used
by such Restricted Subsidiary in the operation of its business in the Ordinary
Course of Business (including through Capital Leases).
SECTION 5.2 LIENS.
Borrower shall not, and shall cause each Credit Party not to,
create, assume or suffer to exist, directly or indirectly, any Lien on any
Collateral, except for Permitted Liens. Except as otherwise permitted herein,
Borrower shall not, and shall cause Parent REIT not to, create, assume or suffer
to exist, directly or indirectly, any Lien on the capital stock, membership
interests, partnership interests or other ownership interests in any Restricted
Subsidiary.
SECTION 5.3 CONTINGENT OBLIGATIONS.
Borrower shall cause each Restricted Subsidiary not to create,
assume, incur or suffer to exist, directly or indirectly, any Contingent
Obligations, except for:
(a) Contingent Obligations arising in respect of the Debt under the
Financing Documents and Letter of Credit Liabilities;
(b) Contingent Obligations resulting from endorsements for
collection or deposit in the Ordinary Course of Business;
(c) Contingent Obligations incurred in the Ordinary Course of
Business with respect to surety and appeal bonds, performance bonds and other
similar obligations not to exceed $250,000 in the aggregate at any time
outstanding;
(d) Contingent Obligations arising under indemnity agreements with
title insurers to cause such title insurers to issue to Administrative Agent
mortgagee title insurance policies;
(e) Contingent Obligations arising with respect to customary
indemnification obligations in favor of purchasers in connection with
dispositions permitted under Section 5.7; and
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(f) other Contingent Obligations not permitted by clauses (a)
through (e) above, not to exceed $100,000 in the aggregate at any time
outstanding.
SECTION 5.4 RESTRICTED DISTRIBUTIONS.
Borrower shall not, and shall cause each other Credit Party not to
declare, order, pay, make or set apart, directly or indirectly, any sum for any
Restricted Distribution. Notwithstanding the foregoing, the following Restricted
Distributions may be made:
(a) Borrower and each Restricted Subsidiary may, in any fiscal
quarter, based on the immediately preceding twelve month period, make cash
payments to their respective shareholders with respect to the equity interests
of Borrower or such Restricted Subsidiary, as the case may be, provided that if
an Event of Default has occurred and is continuing, Borrower and each Restricted
Subsidiary may, in any fiscal quarter, based on the immediately preceding twelve
month period, make cash payments to its shareholders with respect to the equity
interests of Borrower or such Restricted Subsidiary, as the case may be, which,
with the previous such cash payments in the three immediately preceding fiscal
quarters, are not in excess of the greater of (1) ninety-five percent (95%) of
the funds from operations (determined for Borrower or such Restricted
Subsidiary, as the case may be, in accordance with the definition "Funds From
Operation" but on an individual basis and not consolidated with any other
entity) of Borrower or such Restricted Subsidiary, as the case may be, during
such preceding twelve-month period, and (2) the amount required for Borrower or
such Restricted Subsidiary, as the case may be, to maintain its status as a real
estate investment trust under Sections 856-860 of the Code;
(b) the Parent REIT may, in any fiscal quarter, make cash payments
to its shareholders with respect to equity interests of the Parent REIT,
provided that if an Event of Default has occurred and is continuing, the Parent
REIT may, in any fiscal quarter, based on the immediately preceding twelve month
period, make cash payments to its shareholders with respect to the equity
interests of the Parent REIT which, with the previous such cash payments in the
three immediately preceding fiscal quarters, are not in excess of the greater of
(1) ninety-five percent (95%) of the Funds From Operations of the Parent REIT
during such preceding twelve-month period, and (2) the amount required for the
Parent REIT to maintain its status as a real estate investment trust under
Sections 856-860 of the Code; and
(c) repayments of loans and/or payments of interest with respect to
such loans made by a Restricted Subsidiary may be made if, and only to the
extent that at the time of such repayment: (i) such indebtedness is evidenced by
a promissory note that has been collaterally assigned to Administrative Agent,
(ii) the holder of such indebtedness has entered into a Subordination Agreement
and such proposed repayment and/or payment of interest is permitted pursuant to
the terms of such Subordination Agreement; (iii) no Default or Event of Default
has occurred and is continuing and no Default or Event of Default would result
from the making of such repayment, and (iv) after giving effect to any such
proposed repayment, the covenants set forth in Article 6, recomputed for the
most recently ended month and quarter for which information is available as
though such repayments and/or payments of interest had been paid during such
month and quarter, shall not be breached and each Credit Party is in compliance
with all other terms and conditions of this Agreement and the other Financing
Documents, and Borrower shall have provided to Administrative Agent written
evidence of such pro forma compliance as required under this clause (iv) at
least five (5) Business Days prior to the making of any such proposed repayment.
SECTION 5.5 RESTRICTIVE AGREEMENTS.
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Borrower shall cause each Restricted Subsidiary not to enter into or
assume, directly or indirectly, any agreement (other than the Financing
Documents) prohibiting the creation or assumption of any Lien upon its
properties or assets, whether now owned or hereafter acquired. Borrower shall
not, and shall cause the Parent REIT not to enter into or assume, directly or
indirectly, any agreement (other than the Financing Documents) prohibiting the
creation or assumption of any Lien upon any Collateral pledged by Borrower or
the Parent REIT, as the case may be, whether now owned or hereafter acquired.
Borrower shall cause each Restricted Subsidiary not to create or otherwise cause
or suffer to exist or become effective any consensual encumbrance or restriction
of any kind (except as provided by the Financing Documents) on the ability of
any Restricted Subsidiary to: (i) pay or make Restricted Distributions to any
other Credit Party; (ii) pay any Debt owed to any other Credit Party; (iii) make
loans or advances to any other Credit Party; or (iv) transfer any of its
property or assets to any other Credit Party.
SECTION 5.6 RESERVED.
SECTION 5.7 CONSOLIDATIONS, MERGERS AND SALES OF ASSETS.
Borrower shall not, and shall cause each other Credit Party not to,
directly or indirectly (a) consolidate or merge with or into any other Person or
(b) consummate any Asset Disposition if a Default or an Event of Default then
exists or would result from any such Asset Disposition.
SECTION 5.8 PURCHASE OF ASSETS, INVESTMENTS.
Borrower shall cause each Restricted Subsidiary not to, directly or
indirectly (a) acquire or enter into any agreement to acquire any assets other
than in the Ordinary Course of Business; (b) engage or enter into any agreement
to engage in any joint venture or partnership with any other Person; provided
however, that nothing stated herein shall prevent the Parent REIT or Borrower
from entering into a joint venture or partnership with any other Person for the
sole purpose of organizing or forming a Restricted Subsidiary; or (c) acquire or
own or enter into any agreement to acquire or own any Investment in any Person
other than:
(a) Investments existing on the date of this Agreement and set forth
on Schedule 5.8;
(b) Cash Equivalents; and
(c) Investments in securities of account debtors received pursuant
to any plan of reorganization or similar arrangement upon the bankruptcy or
insolvency of such account debtors.
SECTION 5.9 TRANSACTIONS WITH AFFILIATES.
Except as otherwise disclosed on Schedule 5.9, Borrower shall not,
and shall cause each other Credit Party not to, enter into or permit to exist,
directly or indirectly, any transaction (including the purchase, sale, lease or
exchange of any property or the rendering of any service) with any Affiliate of
any Credit Party, except for transactions that are disclosed to Administrative
Agent in advance of being entered into and which in the reasonable judgment of
Borrower contain terms that are no less favorable to the applicable Credit Party
than those which might be obtained from a third party not an Affiliate of any
Credit Party.
SECTION 5.10 MODIFICATION OF ORGANIZATIONAL DOCUMENTS.
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Borrower shall cause each Restricted Subsidiary not to, directly or
indirectly, amend or otherwise modify, any Organizational Documents of such
Restricted Subsidiary, except for such amendments or other modifications
required (a) under this Agreement or (b) by applicable Law and fully disclosed
to Administrative Agent. Neither Borrower nor Parent REIT shall amend its
Organizational Documents in a manner which could reasonably be expected to have
a Material Adverse Effect, without Administrative Agent's reasonable consent.
SECTION 5.11 MODIFICATION OF CERTAIN AGREEMENTS.
Borrower shall not, and shall cause each other Credit Party not to,
amend or otherwise modify, directly or indirectly, any Operative Document or
Management Agreement which amendment or modification in any case:
(a) is contrary to the terms of this Agreement or any other
Financing Document;
(b) could reasonably be expected to be adverse to the rights,
interests or privileges of Administrative Agent or the Lenders or their ability
to enforce the same;
(c) results in the imposition or expansion in any material respect
of any restriction or burden on Borrower or such other Credit Party; or
(d) reduces in any material respect any rights or benefits of
Borrower or such other Credit Party (it being understood and agreed that any
such determination shall be in the discretion of Administrative Agent).
Borrower shall, and shall cause each other Credit Party to, deliver
to Administrative Agent, reasonably in advance of the execution of any amendment
or other modification of any of the foregoing documents, any final or execution
form copy of such amendment or other modification to such documents, except as
permitted above, and Borrower shall not, and shall cause the applicable Credit
Party not to, execute any such amendment or other modification without obtaining
approval from Administrative Agent.
SECTION 5.12 FISCAL YEAR.
Borrower shall not, and shall cause each other Credit Party not to,
change its Fiscal Year.
SECTION 5.13 CONDUCT OF BUSINESS.
Borrower shall not, and shall cause each other Credit Party not to,
engage, directly or indirectly, in any line of business other than those
businesses engaged in on the Closing Date and described on Schedule 5.13 and
businesses reasonably related thereto.
SECTION 5.14 TRANSFERS.
Except as specifically set forth herein, Borrower shall not, and
shall cause each other Credit Party not to, permit or suffer any change of
ownership or Control of Borrower or such Credit Party, as the case may be
(except that there shall be no restriction on any transfer of ownership
interests in the Parent REIT). Borrower shall not, and shall cause each other
Credit Party not to, suffer or permit (a) any change in the management of any
Property, except as permitted under the applicable Property Lease or (b) any
Transfer other than a Permitted Transfer. Notwithstanding the foregoing, so long
as the
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Parent REIT is a REIT, transfers of direct or indirect ownership interests in
the Parent REIT shall be permitted without notice to or consent by
Administrative Agent or Lenders.
SECTION 5.15 LEASE PAYMENTS.
Borrower shall cause each Restricted Subsidiary not to incur or
assume (whether pursuant to a Guarantee or otherwise), directly or indirectly,
any liability for rental payments under a lease with a lease term of one year or
more if, after giving effect thereto, the aggregate amount of minimum lease
payments that the Restricted Subsidiaries have so incurred or assumed will
exceed, on a consolidated basis, $250,000 for any calendar year under all such
leases (excluding Qualified Ground Leases).
SECTION 5.16 RESERVED.
SECTION 5.17 RESERVED.
SECTION 5.18 COMPLIANCE WITH ANTI-TERRORISM LAWS.
Administrative Agent hereby notifies Borrower that pursuant to the
requirements of Anti-Terrorism Laws, and Administrative Agent's policies and
practices, Administrative Agent is required to obtain, verify and record certain
information and documentation that identifies the Credit Parties and their
respective principals, which information includes the name and address of each
Credit Party and its principals and such other information that will allow
Administrative Agent to identify such party in accordance with Anti-Terrorism
Laws. Borrower shall not, and shall cause each other Credit Party not to,
directly or indirectly, knowingly enter into any Operative Documents or Material
Contracts with any Person listed on the OFAC Lists. Borrower shall immediately
notify Administrative Agent if Borrower has knowledge that Borrower or any other
Credit Party is listed on the OFAC Lists or (a) is convicted on, (b) pleads nolo
contendere to, (c) is indicted on, or (d) is arraigned and held over on charges
involving money laundering or predicate crimes to money laundering. Borrower
shall not, and shall cause each other Credit Party not to, directly or
indirectly knowingly (i) conduct any business or engage in any transaction or
dealing with any Blocked Person, including, without limitation, the making or
receiving of any contribution of funds, goods or services to or for the benefit
of any Blocked Person, (ii) deal in, or otherwise engage in any transaction
relating to, any property or interests in property blocked pursuant to Executive
Order No. 13224, any similar executive order or other Anti-Terrorism Law, or
(iii) engage in or conspire to engage in any transaction that evades or avoids,
or has the purpose of evading or avoiding, or attempts to violate, any of the
prohibitions set forth in Executive Order No. 13224 or other Anti-Terrorism Law.
ARTICLE 6
FINANCIAL COVENANTS
Borrower agrees that, so long as any Credit Exposure exists:
SECTION 6.1 FIXED CHARGE COVERAGE RATIO.
The Fixed Charge Coverage Ratio for any Defined Period shall not to
be less than 1.65 to 1.00.
SECTION 6.2 MAXIMUM LEVERAGE.
The ratio of Total Indebtedness to Total Asset Value for any Defined
Period shall not be greater than sixty-five percent (65%).
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SECTION 6.3 MAINTENANCE OF NET WORTH.
Tangible Net Worth shall at all times not be less than the sum of
(a) $200,000,000 plus (b) seventy-five percent (75%) of the aggregate net
proceeds received by the Parent REIT or any of its Subsidiaries in connection
with any offering of Stock or Stock Equivalents after the Closing Date of the
Parent REIT or the Subsidiaries that results in an increase of Tangible Net
Worth.
SECTION 6.4 EVIDENCE OF COMPLIANCE.
Borrower shall furnish to Administrative Agent, within thirty (30)
days of the end of each calendar quarter, evidence (in form and content
satisfactory to Administrative Agent) of compliance with the covenants in this
Article. Such evidence shall include, without limitation, (i) a statement and
report, on a form approved by Administrative Agent, detailing Borrower's
calculations and (ii) if requested by Administrative Agent, back-up
documentation (including, without limitation, invoices, receipts and other
evidence of costs incurred during such quarter as Administrative Agent shall
reasonably require) evidencing the propriety of the calculations.
ARTICLE 7
CONDITIONS
SECTION 7.1 CONDITIONS TO CLOSING.
The obligation of each Lender to make the initial Revolving Loans,
of Administrative Agent to issue any Support Agreements on the Closing Date and
of any LC Issuer to issue any Lender Letter of Credit on the Closing Date shall
be subject to the receipt by Administrative Agent of each agreement, document
and instrument set forth on the Closing Checklist, each in form and substance
satisfactory to Administrative Agent, and to the satisfaction of the following
conditions precedent, each to the satisfaction of Administrative Agent and
Lenders in their sole discretion:
(a) the payment of all fees, expenses and other amounts due and
payable under each Financing Document;
(b) the absence, since June 30, 2005, of any material adverse change
in any aspect of the business, operations, properties, prospects or condition
(financial or otherwise) of any Credit Party, or any event or condition which
could reasonably be expected to result in such a material adverse change;
(c) the receipt of the initial Borrowing Base Certificate, prepared
as of the Closing Date; and
(d) receipt by Administrative Agent of such other documents,
instruments and/or agreements as Administrative Agent may reasonably request.
SECTION 7.2 CONDITIONS TO EACH REVOLVING LOAN, SUPPORT AGREEMENT AND
LENDER LETTER OF CREDIT.
The obligation of the Lenders to make a Revolving Loan (other than
Revolving Loans made pursuant to Section 2.5(c)), of Administrative Agent to
issue any Support Agreement or of any LC Issuer to issue any Lender Letter of
Credit (including, in each case, on the Closing Date) is subject to the
satisfaction of the following additional conditions:
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(a) in the case of a Revolving Loan Borrowing, receipt by
Administrative Agent of a Notice of Borrowing (or telephonic notice as permitted
by Section 2.2(b)(ii)) and updated Borrowing Base Certificate in accordance with
Section 2.2(b) and, in the case of any Support Agreement or Lender Letter of
Credit, receipt by Administrative Agent of a Notice of LC Credit Event in
accordance with Section 2.5(a);
(b) the fact that, immediately after such borrowing and after
application of the proceeds thereof or after such issuance, the Revolving Loan
Outstandings will not exceed the Revolving Loan Limit;
(c) the fact that, immediately before and after such borrowing or
issuance, no Default or Event of Default shall have occurred and be continuing;
(d) the fact that the representations and warranties of each Credit
Party contained in the Financing Documents shall be true, correct and complete
on and as of the date of such borrowing or issuance, except to the extent that
any such representation or warranty relates to a specific date in which case
such representation or warranty shall be true and correct as of such date; and
(e) the fact that no material adverse change in the condition
(financial or otherwise), properties, business, prospects, or operations of any
Credit Party shall have occurred and be continuing since the date of this
Agreement.
Each giving of a Notice of LC Credit Event hereunder, each giving of
a Notice of Borrowing hereunder and each acceptance by Borrower of the proceeds
of any Revolving Loan made hereunder shall be deemed to be (y) a representation
and warranty by Borrower on the date of such notice or acceptance as to the
facts specified in Section 7.2, and (z) a restatement by Borrower that each and
every one of the representations made by it in any of the Financing Documents is
true and correct in all material respects (except to the extent that such
representations and warranties expressly relate solely to a specific date in
which case such representation or warranty shall be true and correct as of such
date).
SECTION 7.3 SEARCHES.
Before Closing, and thereafter (as and when determined by
Administrative Agent in its discretion), Administrative Agent shall have the
right to perform, all at Borrower's expense, the searches described in clauses
(a), (b), (c) and (d) below against any Credit Party, the results of which are
to be consistent with Borrower's representations, warranties and covenants under
this Agreement:
(a) UCC searches with the Secretary of State and local filing
offices of each jurisdiction where the applicable Credit Party maintains its
executive offices, a place of business, or assets and the jurisdiction in which
such Credit Party is organized;
(b) judgment, pending litigation, federal tax lien, personal
property tax lien, and corporate and partnership tax lien searches, in each
jurisdiction searched under clause (a) above;
(c) real property title and lien searches in each jurisdiction in
which any Property is located; and
(d) searches of applicable corporate, limited liability company,
partnership and related records to confirm the continued existence, organization
and good standing of the applicable Credit Party and the exact legal name under
which such Credit Party is organized.
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SECTION 7.4 ELIGIBLE PROPERTY ADDITIONS, DELETIONS AND SUBSTITUTIONS.
(a) Upon ten (10) Business Days' prior written notice from Borrower
to Administrative Agent, Borrower can designate that a Property to be included
in the calculation of the Borrowing Base (subject to the other requirements for
a Property qualifying as an Eligible Property) or deleted from the calculation
of the Borrowing Base. Such notice shall be accompanied by a Borrowing Base
Certificate setting forth the components of the Borrowing Base as of the
addition or deletion of the designated Property, and with respect to a deletion,
Borrower's certification in such detail as reasonably required by Administrative
Agent that such deletion shall not cause or result in (A) a violation of the
Borrowing Base Requirements, (B) an Event of Default, or (C) the Borrower
failing to comply with any of the financial covenants contained herein. Each
addition shall be in a minimum amount equal to $5,000,000 Borrowing Base Value
and shall be subject to approval by Administrative Agent.
(b) Upon ten (10) Business Days prior written notice from Borrower
to Administrative Agent, Borrower may, from time to time, substitute a Property
(subject to the other requirements for a Property qualifying as an Eligible
Property) for an Eligible Property included in the calculation of the Borrowing
Base, provided, that after giving effect to such substitution (x) there shall
not be continuing an Event of Default and (y) the Borrowing Base Requirements
shall be satisfied. Such notice shall be accompanied by a Borrowing Base
Certificate setting forth the components of the Borrowing Base as of the
substitution of the designated Property and showing that there shall not be a
reduction in the Borrowing Base Value.
(c) Concurrently with any written notice delivered to Administrative
Agent pursuant to Section 7.3(a) or (b), as the case may be, Borrower shall
deliver, or cause to be delivered, to Administrative Agent (i) the searches
described in Section 7.3 and (ii) such other documentation as Administrative
Agent may reasonably request in connection therewith, all in form, content and
scope reasonably satisfactory to Administrative Agent. The obligation of
Administrative Agent to include such Property in the calculation of the
Borrowing Base shall be subject to Administrative Agent's receipt of (i)
results, satisfactory to Administrative Agent in its discretion, of an audit,
performed by Administrative Agent or its representative, at Borrower's expense,
of the cash flows with respect to such Property for the twelve months most
recently ended, and (ii) the Eligible Property Deliverables with respect to such
Property.
(d) Notwithstanding anything contained in this Agreement to the
contrary, the Required Lenders in their reasonable discretion may (i) at
Borrower's request, include a Property in the calculation of the Borrowing Base
despite the failure of such Property to otherwise qualify as an Eligible
Property and (ii) upon ten (10) Business Days' prior written notice to Borrower,
designate that a Property shall no longer be included in the calculation of the
Borrowing Base upon their determination that such Property ceases to meet the
criteria set forth in the definition of Eligible Property, provided however,
that if during such ten (10) Business Day Period Borrower can satisfy or cause
to be satisfied those requirements deemed unsatisfied by the Required Lenders,
such Property shall remain an Eligible Property.
(e) If a Property Lessee exercises its option under the related
Property Lease to purchase (and in fact does purchase) the related Property from
the applicable Restricted Subsidiary, Borrower shall, or shall cause such
Restricted Subsidiary to, pay to Administrative Agent, by deposit to the Payment
Account, (i) if no Default or Event of Default shall have occurred and be
continuing, an amount equal to the lesser of (x) a portion of the purchase price
received from or on behalf of such Property Lessee in an amount such that, after
giving effect to the application of such amount to the reduction of the
Revolving Loans or the cash collateralization of Letter of Credit Liabilities
and the removal of such Property from the calculation of the Borrowing Base, the
Revolving Loan Outstandings
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would be less than or equal to the Borrowing Base and (y) the amount of such
purchase price and (ii) if a Default or an Event of Default shall have occurred
and be continuing, an amount equal the amount of such purchase price; provided,
that if the Revolving Loan Outstandings exceed the Borrowing Base (after giving
effect to the repayment of the Revolving Loans or the cash collateralization of
Letter of Credit Liabilities with such purchase price (or portion thereof)
deposited in the Payment Account and the removal of such Property from the
calculation of the Borrowing Base), Borrower shall deposit to the Payment
Account the amount of such excess; provided, further, that nothing contained in
this section shall affect Borrower's obligations under Section 2.2(b). Such
purchase price (or portion thereof) and amount, if any, from Borrower deposited
to the Payment Account shall be applied to repay the Revolving Loans or to cash
collateralize Letter of Credit Liabilities. Upon deposit to the Payment Account
of such purchase price (or portion thereof) and amounts, if any, from Borrower,
Administrative Agent shall, at Borrower's expense, take all such action
reasonably requested by Borrower to release any Lien granted to or held by
Administrative Agent with respect to such Property under any Security Document.
ARTICLE 8
RESERVED
ARTICLE 9
REAL PROPERTY MATTERS
Borrower agrees that, so long as any Credit Exposure exists:
SECTION 9.1 LEASES.
(a) Without the prior written consent of Administrative Agent,
Borrower shall not, and shall cause each other Credit Party not to enter into
any Leases with respect to any Property other than the Property Leases or any
ground lease of any Property other than a Qualified Ground Lease.
(b) If Administrative Agent consents to the modification or renewal
of any existing Property Lease, at Administrative Agent's request, Borrower
shall, and shall cause the applicable Restricted Subsidiary to, cause the tenant
thereunder to execute a subordination and attornment agreement in form and
substance satisfactory to Administrative Agent.
(c) Borrower shall cause each Restricted Subsidiary not to suffer or
permit any breach or default to occur in any of such Restricted Subsidiary's
obligations under any of the Property Leases nor suffer or permit the same to
terminate by reason of any failure of such Restricted Subsidiary to meet any
requirement of any Property Lease. Borrower shall notify Administrative Agent
promptly in writing in the event a Property Lessee commits a default under a
Property Lease. Borrower shall notify Administrative Agent promptly in writing
in the event a tenant other than a Property Lessee commits a material default
under a Property Lease.
SECTION 9.2 PROPERTY USE AND OPERATION.
(a) Without the prior written consent of Administrative Agent in
each instance, which consent shall not be unreasonably withheld or delayed,
Borrower shall not, and shall cause each other Credit Party not to, demolish,
remove, construct, or, except as otherwise expressly provided herein, restore,
or alter the Properties or any portion thereof. No excavation, construction,
earth work, site work or any other mechanic's lienable work shall be done to or
for the benefit of a Property, without Administrative Agent's approval, except
for normal repair and maintenance in the ordinary course of business or as
provided for in the Property Leases. Borrower shall, and shall cause each
Restricted Subsidiary to, (i) take good care of such Restricted Subsidiary's
Properties, including grounds generally,
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and utility systems and sidewalks, roads, alleys, and curbs therein, and shall
keep the same in good, safe and insurable condition and in compliance with all
applicable Laws, (ii) promptly make all repairs to such Properties, above grade
and below grade, interior and exterior, structural and nonstructural, ordinary
and extraordinary, unforeseen and foreseen, and maintain such Properties in a
manner appropriate for its use, and (iii) not commit or suffer to be committed
any waste of such Properties or do or suffer to be done anything which will
increase the risk of fire or other hazard to such Properties or impair the value
thereof, in each case, at Borrower's and such Restricted Subsidiary's expense.
Borrower shall, and shall cause each Restricted Subsidiary to, cause the
sidewalks, vaults, gutters and curbs comprising, or adjacent to, the Properties
to be kept clean and free from dirt, snow, ice, rubbish and obstructions.
(b) Each Credit Party's personal property delivered upon, attached
to, used or required to be used in connection with the operation of any Property
(collectively, the "FF&E") shall always be located at such Property and shall be
kept free and clear of all Liens other than the Permitted Liens. Borrower shall
not, and shall cause each other Credit Party not to, remove or permit to be
removed from any Property any of the FF&E except to repair or replace the same,
in each case, without the prior written consent of Administrative Agent.
SECTION 9.3 CASUALTY PROCEEDS.
(a) Borrower shall notify Administrative Agent promptly of the
commencement or threat of any Taking of any Property or any portion thereof or
of the occurrence of any casualty with respect to any Property.
(b) Subject to the provisions of Section 9.4 below, Administrative
Agent may elect to collect, retain and apply against the Obligations of Borrower
under this Agreement or any of the other Financing Documents all proceeds of
insurance resulting from any loss at any Property or of any Taking of all or any
portion of a Property (individually and collectively referred to as "CASUALTY
PROCEEDS") after deduction of all expenses of collection and settlement,
including reasonable attorneys' and adjusters' fees and charges. Any Casualty
Proceeds remaining after repayment of the Obligations shall be paid by
Administrative Agent to Borrower.
(c) Notwithstanding anything in Section 9.3(b) to the contrary and
subject to the terms of the applicable Property Lease, in the event of any
casualty to any Property or any Taking of part of any Property, Administrative
Agent agrees to make available the Casualty Proceeds to restoration of such
Property if (i) no Event of Default exists, (ii) all Casualty Proceeds are
deposited with Administrative Agent, (iii) in Administrative Agent's reasonable
judgment, the amount of Casualty Proceeds available for restoration of such
Property is sufficient to pay the full and complete costs of such restoration,
(iv) the related Property Lease in effect at the time of such casualty or Taking
will not be terminated as a result of such casualty or Taking, (v) the casualty
or Taking will not render such Property unsuitable for the use described in the
related Property Lease, (vi) in Administrative Agent's reasonable determination,
such Property can be restored to an architecturally and economically viable
Property in compliance with applicable Laws, (vii) each Guarantor, if any,
reaffirms any Financing Documents Guarantee and any other Financing Document to
which it is a party, in writing, and (viii ) in Administrative Agent's
reasonable determination, such restoration is likely to be completed not later
than six (6) months prior to the Termination Date.
(d) Notwithstanding the foregoing, if the damage to a Property does
not exceed $250,000, and so long as no Default has occurred and is continuing,
Borrower shall be entitled to receive the Casualty Proceeds attributable
thereto, provided, however, that Borrower shall use the Casualty Proceeds to
restore or rebuild such Property to its condition prior to such casualty or
Taking.
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(e) If in connection with any casualty to a Property or any Taking
of part of a Property the related Property Lessee exercises its option under the
related Property Lease to purchase (and in fact does purchase) such Property
from the applicable Restricted Subsidiary, Borrower shall, or shall cause such
Restricted Subsidiary to, pay to Administrative Agent, by deposit to the Payment
Account, (i) if no Default or Event of Default shall have occurred and be
continuing, an amount equal to the lesser of (x) a portion of the purchase price
received from or on behalf of such Property Lessee in an amount such that, after
giving effect to the application of such amount to the reduction of the
Revolving Loans and the deletion of such Property from the calculation of the
Borrowing Base, the Revolving Loan Outstandings would be less than or equal to
the Borrowing Base and (y) the amount of such purchase price and (ii) if a
Default or an Event of Default shall have occurred and be continuing, an amount
equal the amount of such purchase price; provided, that if the Revolving Loan
Outstandings exceed the Borrowing Base (after giving effect to the repayment of
the Revolving Loans or the cash collateralization of Letter of Credit
Liabilities with such purchase price (or portion thereof) deposited in the
Payment Account and the removal of such Property from the calculation of the
Borrowing Base), Borrower shall deposit to the Payment Account the amount of
such excess; provided, further, that nothing contained in this section shall
affect Borrower's obligations under Section 2.2(b). Such purchase price (or
portion thereof) and amount, if any, from Borrower deposited to the Payment
Account shall be applied to repay the Revolving Loans or to cash collateralize
Letter of Credit Liabilities. Upon deposit to the Payment Account of such
purchase price (or portion thereof) and amounts, if any, from Borrower,
Administrative Agent shall, at Borrower's expense, take all such action
reasonably requested by Borrower to release any Lien granted to or held by
Administrative Agent with respect to such Property under any Security Document.
SECTION 9.4 OBLIGATION TO REBUILD AND USE OF CASUALTY PROCEEDS THEREFOR.
(a) In case Administrative Agent does not elect to apply or does not
have the right to apply the Casualty Proceeds to the Obligations, as provided in
Section 9.3 above, Borrower shall, and shall cause each other Credit Party to:
(i) subject to the terms of the applicable Property Lease,
proceed with diligence to make settlement with insurers or the appropriate
Governmental Authorities and cause the Casualty Proceeds to be deposited with
Administrative Agent, in each case;
(ii) in the event of any delay in making settlement with
insurers or the appropriate Governmental Authorities or effecting collection of
the Casualty Proceeds, deposit with Administrative Agent the full amount
required to complete construction as aforesaid;
(iii) n the event the Casualty Proceeds are insufficient to
assure Administrative Agent that the all contemplated repairs or construction
will be completed, promptly deposit with Administrative Agent any amount
necessary to assure that such contemplated repairs or construction will be
completed; and
(iv) subject to the terms of the applicable Property Lease,
promptly proceed with the assumption of construction of the affected Property,
including the repair of all damage resulting from such fire, Taking or other
cause and restoration to its former condition.
(b) Any request by Borrower for a disbursement by Administrative
Agent of Casualty Proceeds and funds deposited by Borrower shall be treated by
Administrative Agent as if such request were for an advance of the Revolving
Loans hereunder, and the disbursement thereof shall be conditioned upon
Borrower's compliance with and satisfaction of the same conditions precedent as
would be applicable under this Agreement for an advance of the Revolving Loans.
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(c) Notwithstanding anything to the contrary, if the damage to a
Property does not exceed $250,000, and so long as no Default has occurred and is
continuing, Borrower may, subject to the terms of the applicable Property Lease,
settle and adjust any claim without the consent of Administrative Agent and
agree with the insurers (or Governmental Authority, in the case of a Taking) on
the amount to be paid upon the loss, provided, however, that such adjustment is
carried out in a competent and timely manner. Any monies collected under this
subsection (c) shall be applied in accordance with Section 11.6.
(d) If the damage to any Property exceeds $250,000, then
Administrative Agent may, subject to the terms of the applicable Property Lease,
elect to file the respective proof of loss, settle and adjust any claim without
the consent of Borrower or any other Credit Party and agree with the insurers on
the amount of the Casualty Proceeds in the place and stead of Borrower or any
other Credit Party and without the consent of Borrower or any other Credit
Party; provided, however, that so long as no Default exist, Administrative Agent
agrees to work with Borrower and to keep Borrower fully apprised of any and all
action Administrative Agent takes to settle or adjust any claim. Borrower hereby
releases Administrative Agent from any and all liability with respect to the
settlement and adjustment by Administrative Agent of any claims in respect of
any casualty.
SECTION 9.5 TAX REDUCTION PROCEEDINGS.
After an Event of Default, Borrower shall be deemed to have
appointed Administrative Agent as its attorney-in-fact to seek a reduction or
reductions in the assessed valuation of each Property for real property tax
purposes or for any other purpose and to prosecute any action or proceeding in
connection therewith. This power, being coupled with an interest, shall be
irrevocable for so long as any part of the Obligations remains unpaid and any
Event of Default shall be continuing.
SECTION 9.6 COMMINGLING; FIRPTA.
Neither Borrower nor any other Credit Party has commingled, nor has
Borrower or any other Credit Party permitted or caused to be commingled, the
funds related to the Properties with funds from any other property, except to
the extent that such funds related to the Properties can be accounted for by the
Borrower or such other Credit Party and are readily identifiable as funds
separate and apart from any other property. Neither Borrower nor any Restricted
Subsidiary nor any partner, stockholder or member in Borrower or any Restricted
Subsidiary is or will be, and no legal or beneficial interest of a partner,
stockholder or member in Borrower or any Restricted Subsidiary is or will be
held, directly or indirectly, by a "foreign corporation", "foreign partnership",
"foreign trust", "foreign estate", "foreign person", "affiliate" of a "foreign
person" or a "United States intermediary" of a "foreign person" within the
meaning of the Internal Revenue Code Sections 897, 1445 or 7701, the Foreign
Investments in Real Property Tax Act of 1980, the International Foreign
Investment Survey Act of 1976, the Agricultural Foreign Investment Disclosure
Act of 1978, or the regulations promulgated pursuant to such Acts or any
amendments to such Acts.
SECTION 9.7 REPRESENTATIONS AND WARRANTIES.
To induce Administrative Agent and Lenders to enter into this Agreement
and to make the Revolving Loans and other credit accommodations contemplated
hereby, Borrower hereby represents and warrants to Administrative Agent and each
Lender the following with respect to each individual Property, standing alone
and without reliance upon any other Property:
(a) Except as disclosed to Administrative Agent in writing, (i) no
condemnation of any portion of any Property, has commenced or, to Borrower's
knowledge, is contemplated by any Governmental Authority, (ii) no condemnation
or relocation of any roadways abutting any Property has
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commenced or, to Borrower's knowledge, is contemplated by any Governmental
Authority, and (iii) no proceeding to deny access to any Property from any point
or planned point of access to such Property, has commenced or, to Borrower's
knowledge, is contemplated by any Governmental Authority.
(b) Except as disclosed to Administrative Agent on the land title
surveys delivered to Administrative Agent with respect to any Property, no
material portion of any building or other improvement encroaches upon any
property line, building line, set back line, side yard line or any recorded or
visible easement (or other easement of which Borrower is aware or has reason to
believe may exist) with respect to such Property not covered by title insurance
reasonably acceptable to Administrative Agent. Such Property is accessible
through fully improved and dedicated roads, accepted for maintenance and public
use by public authority having jurisdiction. Such Property has adequate water,
gas and electrical supply, storm and sanitary sewerage facilities, telephone
facilities, other required public utilities, fire and police protection, and
means of access between such Property and public highways; none of the foregoing
will be foreseeably delayed or impeded by virtue of any requirements under any
applicable Laws. The parcels of land comprising such Property are contiguous,
subdivided parcels and are in full compliance with applicable subdivision
ordinances. No subdivision or resubdivision of such parcels is required to: (y)
convey, transfer, assign or lease such parcels, either individually or as a
whole; or (z) rebuild after a casualty all or any portion of the improvements on
such Property to current size and configuration.
(c) Each Property is taxed separately without regard to any other
property and for all purposes such Property may be mortgaged, conveyed and
otherwise dealt with as an independent parcel. There are no unpaid or
outstanding real estate or other taxes or assessments on or against such
Property or any part thereof, except general real estate taxes for the current
fiscal year not yet due or payable. There is no pending or, to Borrower's
knowledge, contemplated action pursuant to which any special assessment may be
levied against any portion of such Property.
(d) There has been no damage or destruction of any part of any
Property by fire or other casualty that has not been repaired. Except for the
deferred maintenance items, if any, reflected on Schedule 9.7 or as part of
routine maintenance or capital improvements required to be made by Borrower or
the applicable Restricted Subsidiary under this Agreement, there are presently
no existing defects in any Property and no repairs or alterations thereof are
reasonably necessary or appropriate.
(e) Except for the Property Leases which have been provided to and
approved by Administrative Agent in writing and any Qualified Ground Lease,
neither Borrower nor any Credit Party has entered into any non-residential
Leases that are currently in effect.
ARTICLE 10
RESERVED
ARTICLE 11
EVENTS OF DEFAULT
SECTION 11.1 EVENTS OF DEFAULT.
For purposes of the Financing Documents, the occurrence of any of
the following conditions and/or events, whether voluntary or involuntary, by
operation of law or otherwise, shall constitute an "EVENT OF DEFAULT":
(a) Borrower shall fail to pay (i) when due the principal amount of
any Revolving Loan or (ii) within five (5) days of the due date therefor, any
interest, premium or fee under any
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Financing Document or any other amount (other than the principal amount of any
Revolving Loan) payable under any Financing Document;
(b) Borrower shall fail to observe or perform any covenant contained
in (i) Section 4.2, 4.3(b) or (c), 4.4(b) or (c), 4.7, 9.1(a) or 9.2 or Article
5 or 6, (ii) Section 4.1, 4.4(d) or (e), 4.6, 4.8, 4.9, 4.12, 4.13, 4.14, 4.16,
9.1(c) or 9.3 and such failure is not remedied or waived within ten (10) days
after the earlier of (x) receipt by Borrower of notice from Administrative Agent
or Required Lenders of such failure and (y) actual knowledge of Borrower of such
failure, or (iii) Section 4.3(a), 4.4(a), 4.5, 4.10, 4.11, 4.17, 9.1(b), 9.4,
9.6 or 9.7 and such failure is not remedied or waived within thirty (30) days
after the earlier of (x) receipt by Borrower of notice from Administrative Agent
or Required Lenders of such failure and (y) actual knowledge of Borrower of such
failure, provided, that if any such failure in this clause (iii) is not capable
of being remedied within such thirty (30) days, Borrower shall have an
additional sixty (60) days to remedy such failure provided Borrower is
diligently proceeding to effect such remedy; provided, further, that the failure
of Borrower to observe or perform any covenant contained in Section 4.4(a), (b),
(c), (d) or (e) shall not be an Event of Default under this Section 11.1(b) if a
Property Lessee is making the payments or performing the obligations set forth
therein, as contemplated by Section 4.4(h);
(c) any Credit Party defaults in the performance of or compliance
with any term contained in this Agreement or in any other Financing Document
(other than occurrences described in other provisions of this Section 11.1 for
which a different grace or cure period is specified or for which no grace or
cure period is specified and thereby constitute immediate Events of Default) and
such default is not remedied or waived within thirty (30) days after the earlier
of (i) receipt by Borrower of notice from Administrative Agent or Required
Lenders of such default, or (ii) actual knowledge of Borrower or any other
Credit Party of such default;
(d) any representation, warranty, certification or statement made by
any Credit Party or any other Person in any Financing Document or in any
certificate, financial statement or other document delivered pursuant to any
Financing Document is incorrect in any respect (or in any material respect if
such representation, warranty, certification or statement is not by its terms
already qualified as to materiality) when made (or deemed made);
(e) failure of any Credit Party to pay when due or within any
applicable grace period any principal, interest or other amount on Debt (other
than the Revolving Loans), or the occurrence of any breach, default, condition
or event with respect to any Debt (other than the Revolving Loans), if the
effect of such failure or occurrence is to cause or to permit the holder or
holders of any such Debt to cause, Debt or other liabilities having an aggregate
principal amount in excess of $250,000 to become or be declared due prior to its
stated maturity, to the extent that the acceleration of any such Debt could have
a Material Adverse Effect;
(f) any Credit Party shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to
itself or its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part of
its property, or shall consent to any such relief or to the appointment of or
taking possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they become
due, or shall take any corporate action to authorize any of the foregoing;
(g) an involuntary case or other proceeding shall be commenced
against any Credit Party seeking liquidation, reorganization or other relief
with respect to it or its debts under any
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bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for a
period of sixty (60) days; or an order for relief shall be entered against any
Credit Party under the federal bankruptcy laws as now or hereafter in effect;
(h) (i) institution of any steps by any Person to terminate a
Pension Plan if as a result of such termination any Credit Party or any member
of the Controlled Group could be required to make a contribution to such Pension
Plan, or could incur a liability or obligation to such Pension Plan, in excess
of $250,000, (ii) a contribution failure occurs with respect to any Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA, or (iii) there
shall occur any withdrawal or partial withdrawal from a Multiemployer Plan and
the withdrawal liability (without unaccrued interest) to Multiemployer Plans as
a result of such withdrawal (including any outstanding withdrawal liability that
any Credit Party or any member of the Controlled Group have incurred on the date
of such withdrawal) exceeds $250,000;
(i) one or more judgments or orders for the payment of money (not
paid or fully covered by insurance maintained in accordance with the
requirements of this Agreement and as to which the relevant insurance company
has acknowledged coverage) aggregating in excess of $250,000 with respect to a
Restricted Subsidiary or aggregating in excess of $1,000,000 with respect to
Borrower or the Parent REIT, shall be rendered against any such Credit Party and
either (i) enforcement proceedings shall have been commenced by any creditor
upon any such judgments or orders, or (ii) there shall be any period of twenty
(20) consecutive days during which a stay of enforcement of any such judgments
or orders, by reason of a pending appeal, bond or otherwise, shall not be in
effect;
(j) (i) the Parent REIT shall cease, directly or indirectly, to own
and control (A) at least 51% of the outstanding equity interests of Borrower or
(B) 100% of the general partner of Borrower or (ii) Borrower shall cease to own
and control at least 51% of the outstanding equity interests of any Restricted
Subsidiary;
(k) any Lien created by any of the Security Documents shall at any
time fail to constitute a valid and perfected Lien on all of the Collateral
purported to be secured thereby, subject to no prior or equal Lien except
Permitted Liens, or any Credit Party shall so assert;
(l) any Credit Party shall be prohibited or otherwise materially
restrained from conducting the business theretofore conducted by it by virtue of
any casualty, any labor strike, any determination, ruling, decision, decree or
order of any court or regulatory authority of competent jurisdiction or any
other event and such casualty, labor strike, determination, ruling, decision,
decree, order or other event remains unstayed and in effect for any period of
ten (10) days;
(m) the institution by any Governmental Authority of criminal
proceedings against any Credit Party; and/or
(n) any Operative Document at any time after its execution and
delivery and for any reason other than as expressly permitted hereunder ceases
to be in full force and effect; or any Credit Party contests in any manner the
validity or enforceability of any Operative Document; or any Credit Party denies
that it has any or further liability or obligation under any Operative Document,
or purports to revoke, terminate or rescind any Operative Document.
All cure periods provided for in this Section shall run concurrently
with any cure period provided for in any applicable Financing Documents under
which the default occurred.
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SECTION 11.2 ACCELERATION AND SUSPENSION OR TERMINATION OF REVOLVING LOAN
COMMITMENT.
Upon the occurrence and during the continuance of an Event of
Default, Administrative Agent may, and shall if requested by Required Lenders,
(a) by notice to Borrower suspend or terminate the Revolving Loan Commitment and
the obligations of Administrative Agent and the Lenders with respect thereto, in
whole or in part (and, if in part, such reduction shall be pro rata among the
Lenders having a Revolving Loan Commitment Percentage), and/or (b) by notice to
Borrower declare the Obligations to be, and the Obligations shall thereupon
become, immediately due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by Borrower and
Borrower will pay the same; provided, however, that in the case of any of the
Events of Default specified in Section 11.1(f) or 11.1(g) above, without any
notice to Borrower or any other act by Administrative Agent or the Lenders, the
Revolving Loan Commitment and the obligations of Administrative Agent and the
Lenders with respect thereto shall thereupon terminate and all of the
Obligations shall become immediately due and payable without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
Borrower and Borrower will pay the same.
SECTION 11.3 CASH COLLATERAL.
If (a) any Event of Default specified in Section 11.1(f) or 11.1(g)
shall occur, (b) the Obligations shall have otherwise been accelerated pursuant
to Section 11.2, or (c) the Revolving Loan Commitment and the obligations of
Administrative Agent and the Lenders with respect thereto shall have been
terminated pursuant to Section 11.2, then without any request or the taking of
any other action by Administrative Agent or the Lenders, Borrower shall
immediately comply with the provisions of Section 2.5(e) with respect to the
deposit of cash collateral to secure the existing Letter of Credit Liability and
future payment of related fees.
SECTION 11.4 DEFAULT RATE OF INTEREST.
At the election of Administrative Agent or Required Lenders, after
the occurrence of an Event of Default and for so long as it continues, (a) the
Revolving Loans and other Obligations shall bear interest at rates that are five
percent (5.0%) per annum in excess of the rates otherwise payable under this
Agreement, and (b) the fee described in Section 2.5(b) shall increase by a rate
that is five percent (5.0%) in excess of the rate otherwise payable under such
Section.
SECTION 11.5 SETOFF RIGHTS.
During the continuance of any Event of Default, each Lender is
hereby authorized by Borrower at any time or from time to time, with reasonably
prompt subsequent notice to Borrower (any prior or contemporaneous notice being
hereby expressly waived) to set off and to appropriate and to apply any and all
(a) balances held by such Lender or any of such Lender's Affiliates at any of
its offices for the account of Borrower or any of its Subsidiaries (regardless
of whether such balances are then due to Borrower or its Subsidiaries), and (b)
other property at any time held or owing by such Lender to or for the credit or
for the account of Borrower or any of its Subsidiaries, against and on account
of any of the Obligations; except that no Lender shall exercise any such right
without the prior written consent of Administrative Agent. Any Lender exercising
a right to set off shall purchase for cash (and the other Lenders shall sell)
interests in each of such other Lender's Pro Rata Share of the Obligations as
would be necessary to cause all Lenders to share the amount so set off with each
other Lender in accordance with their respective Pro Rata Share of the
Obligations. Borrower agrees, to the fullest extent permitted by law, that any
Lender and any of such Lender's Affiliates may exercise its right to set off
with respect to the Obligations as provided in this Section 11.5.
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SECTION 11.6 APPLICATION OF PROCEEDS.
Notwithstanding anything to the contrary contained in this
Agreement, upon the occurrence and during the continuance of an Event of
Default, (a) Borrower irrevocably waives the right to direct the application of
any and all payments at any time or times thereafter received by Administrative
Agent from or on behalf of Borrower or any Guarantor of all or any part of the
Obligations, and, as between Borrower on the one hand and Administrative Agent
and Lenders on the other, Administrative Agent shall have the continuing and
exclusive right to apply and to reapply any and all payments received against
the Obligations in such manner as Administrative Agent may deem advisable
notwithstanding any previous application by Administrative Agent, and (b) the
proceeds of any sale of, or other realization upon, all or any part of the
Collateral shall be applied: first, to all fees, costs, indemnities,
liabilities, obligations and expenses incurred by or owing to Administrative
Agent with respect to this Agreement or the other Financing Documents; second,
to all fees, costs, indemnities, liabilities, obligations and expenses incurred
by or owing to any Lender with respect to this Agreement or the other Financing
Documents; third, to accrued and unpaid interest on the Obligations (including
any interest which, but for the provisions of the Bankruptcy Code, would have
accrued on such amounts); fourth, to the principal amount of the Obligations
outstanding; and fifth to any other indebtedness or obligations of Borrower
owing to Administrative Agent or any Lender under the Financing Documents. Any
balance remaining shall be delivered to Borrower or to whoever may be lawfully
entitled to receive such balance or as a court of competent jurisdiction may
direct. In carrying out the foregoing, (x) amounts received shall be applied in
the numerical order provided until exhausted prior to the application to the
next succeeding category, and (y) each of the Persons entitled to receive a
payment in any particular category shall receive an amount equal to its pro rata
share of amounts available to be applied pursuant thereto for such category.
SECTION 11.7 WAIVERS.
(a) Except as otherwise provided for in this Agreement and to the
fullest extent permitted by applicable law, Borrower waives: (i) presentment,
demand and protest, and notice of presentment, dishonor, intent to accelerate,
acceleration, protest, default, nonpayment, maturity, release, compromise,
settlement, extension or renewal of any or all Financing Documents, the Notes or
any other notes, commercial paper, accounts, contracts, documents, instruments,
chattel paper and Guarantees at any time held by Lenders on which Borrower may
in any way be liable, and hereby ratifies and confirms whatever Lenders may do
in this regard; (ii) all rights to notice and a hearing prior to Administrative
Agent's or any Lender's taking possession or control of, or to Administrative
Agent's or any Lender's replevy, attachment or levy upon, any Collateral or any
bond or security which might be required by any court prior to allowing
Administrative Agent or any Lender to exercise any of its remedies; and (iii)
the benefit of all valuation, appraisal and exemption Laws. Borrower
acknowledges that it has been advised by counsel of its choices and decisions
with respect to this Agreement, the other Financing Documents and the
transactions evidenced hereby and thereby.
(b) Borrower for itself and all endorsers, guarantors and sureties
and heir, heirs, legal representatives, its successors and assigns, (i) agrees
that its liability shall not be in any manner affected by any indulgence,
extension of time, renewal, waiver, or modification granted or consented to by
Administrative Agent or any Lender; (ii) consents to any indulgences and all
extensions of time, renewals, waivers, or modifications that may be granted by
Administrative Agent or any Lender with respect to the payment or other
provisions of the Financing Documents, and to any substitution, exchange or
release of the Collateral, or any part thereof, with or without substitution,
and agrees to the addition or release of any endorsers, guarantors, or sureties,
or whether primarily or secondarily liable, without notice to Borrower and
without affecting its liability hereunder; (iii) agrees that its liability shall
be unconditional and without regard to the liability of Administrative Agent or
any Lender for any tax on the
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indebtedness; and (iv) expressly waives the benefit of any statute or rule of
law or equity now provided, or which may hereafter be provided, which would
produce a result contrary to or in conflict with the foregoing.
(c) To the extent that Administrative Agent or any Lender may have
acquiesced in any noncompliance with any requirements or conditions precedent to
the closing of the Revolving Loans or to any subsequent disbursement of
Revolving Loan proceeds, such acquiescence shall not be deemed to constitute a
waiver by Administrative Agent or any Lender of such requirements with respect
to any future disbursements of Revolving Loan proceeds and Administrative Agent
may at any time after such acquiescence require Borrower to comply with all such
requirements. Any forbearance by Administrative Agent or any Lender in
exercising any right or remedy under any of the Financing Documents, or
otherwise afforded by applicable law, including any failure to accelerate the
maturity date of the Revolving Loans, shall not be a waiver of or preclude the
exercise of any right or remedy nor shall it serve as a novation of the Notes or
as a reinstatement of the Revolving Loans or a waiver of such right of
acceleration or the right to insist upon strict compliance of the terms of the
Financing Documents. Administrative Agent's or any Lender's acceptance of
payment of any sum secured by any of the Financing Documents after the due date
of such payment shall not be a waiver of Administrative Agent's or such Lender's
right to either require prompt payment when due of all other sums so secured or
to declare a default for failure to make prompt payment. The procurement of
insurance or the payment of taxes or other liens or charges by Administrative
Agent as the result of an Event of Default shall not be a waiver of
Administrative Agent's right to accelerate the maturity of the Revolving Loans,
nor shall Administrative Agent's receipt of any condemnation awards, insurance
proceeds, or damages under this Agreement operate to cure or waive any Credit
Party's default in payment of sums secured by any of the Financing Documents.
(d) Without limiting the generality of anything contained in this
Agreement or the other Financing Documents, Borrower agrees that if an Event of
Default is continuing (i) Administrative Agent and the Lenders are not subject
to any "one action" or "election of remedies" law or rule, and (ii) all Liens
and other rights, remedies or privileges provided to Administrative Agent or
Lenders shall remain in full force and effect until Administrative Agent or
Lenders have exhausted all remedies against the Collateral and any other
properties owned by the Credit Parties and the Financing Documents and other
security instruments or agreements securing the Revolving Loans have been
foreclosed, sold and/or otherwise realized upon in satisfaction of the
obligations of the Credit Parties under the Financing Documents.
(e) Nothing contained herein or in any other Financing Document
shall be construed as requiring Administrative Agent or any Lender to resort to
any part of the Collateral for the satisfaction of any obligations of the Credit
Parties under the Financing Documents in preference or priority to any other
Collateral, and Administrative Agent may seek satisfaction out of all of the
Collateral or any part thereof, in its absolute discretion in respect of
obligations of the Credit Parties under the Financing Documents. In addition,
Administrative Agent shall have the right from time to time to partially
foreclose upon any Collateral in any manner and for any amounts secured by the
Financing Documents then due and payable as determined by Administrative Agent
in its sole discretion, including, without limitation, the following
circumstances: (i) in the event Borrower defaults beyond any applicable grace
period in the payment of one or more scheduled payments of principal and/or
interest, Administrative Agent may foreclose upon all or any part of the
Collateral to recover such delinquent payments, or (ii) in the event
Administrative Agent or the Required Lenders elect to accelerate less than the
entire outstanding principal balance of the Revolving Loans, Administrative
Agent may foreclose all or any part of the Collateral to recover so much of the
principal balance of the Revolving Loans accelerated and such other sums secured
by one or more of the Financing Documents as Administrative Agent may elect.
Notwithstanding one or
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more partial foreclosures, any unforeclosed Collateral shall remain subject to
the Financing Documents to secure payment of sums secured by the Financing
Documents and not previously recovered.
(f) Borrower, for itself and its successors and assigns, waives in
the event of foreclosure of any or all of the Collateral any equitable right
otherwise available to any Credit Party which would require the separate sale of
the any of the Collateral or require Administrative Agent or Lenders to exhaust
their remedies against any part of the Collateral before proceeding against any
other part of the Collateral; and further in the event of such foreclosure
Borrower does hereby expressly consent to and authorize, at the option of
Administrative Agent, the foreclosure and sale either separately or together of
each part of the Collateral.
SECTION 11.8 INJUNCTIVE RELIEF.
The parties acknowledge and agree that, in the event of a breach or
threatened breach of any Credit Party's obligations under any Financing
Documents, Administrative Agent and Lenders may have no adequate remedy in money
damages and, accordingly, shall be entitled to an injunction (including without
limitation, a temporary restraining order, preliminary injunction, writ of
attachment, or order compelling an audit) against such breach or threatened
breach. However, no specification in this Agreement of a specific legal or
equitable remedy shall be construed as a waiver or prohibition against any other
legal or equitable remedies in the event of a breach or threatened breach of any
provision of this Agreement. Borrower waives the requirement of the posting of
any bond in connection with such injunctive relief.
SECTION 11.9 MARSHALLING.
Administrative Agent and Lenders shall have no obligation to marshal
any assets in favor of any Credit Party, or against or in payment of any of the
other Obligations or any other obligation owed to Administrative Agent or
Lenders by any Credit Party.
ARTICLE 12
EXPENSES AND INDEMNITY
SECTION 12.1 EXPENSES.
Borrower hereby agrees to promptly pay (a) all reasonable costs and
expenses of Administrative Agent (including, without limitation, the reasonable
fees, costs and expenses of counsel to, and independent appraisers and
consultants retained by Administrative Agent) in connection with the
examination, review, due diligence investigation, documentation, negotiation,
closing and syndication of the transactions contemplated by the Financing
Documents, in connection with the performance by Administrative Agent of its
rights and remedies under the Financing Documents and in connection with the
continued administration of the Financing Documents including: (i) any
amendments, modifications, consents and waivers to and/or under any and all
Financing Documents and (ii) any periodic public record searches conducted by or
at the request of Administrative Agent (including, without limitation, title
investigations, UCC searches, fixture filing searches, judgment, pending
litigation and tax lien searches and searches of applicable corporate, limited
liability, partnership and related records concerning the continued existence,
organization and good standing of certain Persons), (b) without limitation of
the preceding clause (a), all reasonable costs and expenses of Administrative
Agent (including recordation and transfer taxes) in connection with the
creation, perfection and maintenance of Liens pursuant to the Financing
Documents, (c) without limitation of the preceding clause (a), all costs and
expenses of Administrative Agent in connection with (i) protecting, storing,
insuring, handling, maintaining or selling any Collateral; (ii) any litigation,
dispute, suit or proceeding relating to any Operative Document; and
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(iii) any workout, collection, bankruptcy, insolvency and other enforcement
proceedings under any and all of the Operative Documents, and (d) all costs and
expenses incurred by Lenders in connection with any litigation, dispute, suit or
proceeding relating to any Operative Document and in connection with any
workout, collection, bankruptcy, insolvency and other enforcement proceedings
under any and all Operative Documents, provided, however, that to the extent
that the costs and expenses referred to in this clause (d) consist of fees,
costs and expenses of counsel, Borrower shall be obligated to pay such fees,
costs and expenses for counsel to Administrative Agent and for only one counsel
acting for all Lenders (other than Administrative Agent).
SECTION 12.2 INDEMNITY.
Borrower hereby agrees to indemnify, pay and hold harmless
Administrative Agent and Lenders and the officers, directors, employees,
trustees, agents, investment advisors, collateral managers, servicers, and
counsel of Administrative Agent and Lenders (collectively called the
"INDEMNITEES") from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, claims, costs, expenses and
disbursements of any kind or nature whatsoever (including the fees and
disbursements of counsel for such Indemnitee) in connection with any
investigative, response, remedial, administrative or judicial matter or
proceeding, whether or not such Indemnitee shall be designated a party thereto
and including any such proceeding initiated by or on behalf of a Credit Party,
and the reasonable expenses of investigation by engineers, environmental
consultants and similar technical personnel and any commission, fee or
compensation claimed by any broker (other than any broker retained by
Administrative Agent or Lenders) asserting any right to payment for the
transactions contemplated hereby, which may be imposed on, incurred by or
asserted against such Indemnitee as a result of or in connection with the
transactions contemplated hereby or by the other Operative Documents (including
(a)(i) as a direct or indirect result of the presence on or under, or escape,
seepage, leakage, spillage, discharge, emission or release from, any property
now or previously owned, leased or operated by Borrower, any Subsidiary or any
other Person of any Hazardous Materials or any Hazardous Materials
Contamination, (ii) arising out of or relating to the offsite disposal of any
materials generated or present on any such property, or (iii) arising out of or
resulting from the environmental condition of any such property or the
applicability of any governmental requirements relating to Hazardous Materials,
whether or not occasioned wholly or in part by any condition, accident or event
caused by any act or omission of Borrower or any Subsidiary, and (b) proposed
and actual extensions of credit under this Agreement) and the use or intended
use of the proceeds of the Revolving Loans and Letters of Credit, except that
Borrower shall not have any obligation hereunder to an Indemnitee with respect
to any liability resulting from the gross negligence or willful misconduct of
such Indemnitee, as determined by a final non-appealable judgment of a court of
competent jurisdiction. To the extent that the undertaking set forth in the
immediately preceding sentence may be unenforceable, Borrower shall contribute
the maximum portion which it is permitted to pay and satisfy under applicable
law to the payment and satisfaction of all such indemnified liabilities incurred
by the Indemnitees or any of them.
ARTICLE 13
ADMINISTRATIVE AGENT
SECTION 13.1 APPOINTMENT AND AUTHORIZATION.
Each Lender hereby irrevocably appoints and authorizes
Administrative Agent to enter into each of the Financing Documents to which it
is a party (other than this Agreement) on its behalf and to take such actions as
Administrative Agent on its behalf and to exercise such powers under the
Financing Documents as are delegated to Administrative Agent by the terms
thereof, together with all such powers as are reasonably incidental thereto.
Subject to the terms of Section 13.16 and to the terms of the other Financing
Documents, Administrative Agent is authorized and empowered to amend, modify,
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or waive any provisions of this Agreement or the other Financing Documents on
behalf of Lenders. The provisions of this Article 13 are solely for the benefit
of Administrative Agent and Lenders and neither Borrower nor any other Credit
Party shall have any rights as a third party beneficiary of any of the
provisions hereof. In performing its functions and duties under this Agreement,
Administrative Agent shall act solely as agent of 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 Credit Party. Administrative
Agent may perform any of its duties hereunder, or under the Financing Documents,
by or through its agents or employees.
SECTION 13.2 ADMINISTRATIVE AGENT AND AFFILIATES.
Administrative Agent shall have the same rights and powers under the
Financing Documents as any other Lender and may exercise or refrain from
exercising the same as though it were not Administrative Agent, and
Administrative Agent and its Affiliates may lend money to, invest in and
generally engage in any kind of business with each Credit Party or Affiliate of
any Credit Party as if it were not Administrative Agent hereunder.
SECTION 13.3 ACTION BY ADMINISTRATIVE AGENT.
The duties of Administrative Agent shall be mechanical and
administrative in nature. 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 Financing Documents is intended to or shall be construed
to impose upon Administrative Agent any obligations in respect of this Agreement
or any of the Financing Documents except as expressly set forth herein or
therein.
SECTION 13.4 CONSULTATION WITH EXPERTS.
Administrative Agent may consult with legal counsel, independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken by it in good faith in accordance with
the advice of such counsel, accountants or experts.
SECTION 13.5 LIABILITY OF ADMINISTRATIVE AGENT.
Neither Administrative Agent nor any of its directors, officers,
agents or employees shall be liable to any Lender for any action taken or not
taken by it in connection with the Financing Documents, except that
Administrative Agent shall be liable with respect to its specific duties set
forth hereunder but only to the extent of its own gross negligence or willful
misconduct in the discharge thereof as determined by a final non-appealable
judgment of a court of competent jurisdiction. Neither Administrative Agent nor
any of its directors, officers, agents or employees shall be responsible for or
have any duty to ascertain, inquire into or verify (a) any statement, warranty
or representation made in connection with any Financing Document or any
borrowing hereunder; (b) the performance or observance of any of the covenants
or agreements specified in any Financing Document; (c) the satisfaction of any
condition specified in any Financing Document; (d) the validity, effectiveness,
sufficiency or genuineness of any Financing Document, any Lien purported to be
created or perfected thereby or any other instrument or writing furnished in
connection therewith; (e) the existence or non-existence of any Default or Event
of Default; or (f) the financial condition of any Credit Party. Administrative
Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement, or other writing (which may be a bank wire,
telex, facsimile or electronic transmission or similar writing) believed by it
to be genuine or to be signed by the proper party or parties. Administrative
Agent shall not be liable for any apportionment or distribution of payments made
by it in good faith and if any such apportionment or distribution is
subsequently determined to have been made in error the sole recourse of any
Lender to
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whom payment was due but not made, shall be to recover from other Lenders any
payment in excess of the amount to which they are determined to be entitled (and
such other Lenders hereby agree to return to such Lender any such erroneous
payments received by them).
SECTION 13.6 INDEMNIFICATION.
Each Lender shall, in accordance with its Pro Rata Share, indemnify
Administrative Agent (to the extent not reimbursed by Borrower or any other
Credit Party) upon demand against any cost, expense (including counsel fees and
disbursements), claim, demand, action, loss or liability (except such as result
from Administrative Agent's gross negligence or willful misconduct as determined
by a final non-appealable judgment of a court of competent jurisdiction) that
Administrative Agent may suffer or incur in connection with the Financing
Documents or any action taken or omitted by Administrative Agent hereunder or
thereunder. If any indemnity furnished to Administrative Agent for any purpose
shall, in the opinion of Administrative Agent, be insufficient or become
impaired, Administrative Agent may call for additional indemnity and cease, or
not commence, to do the acts indemnified against even if so directed by Required
Lenders until such additional indemnity is furnished.
SECTION 13.7 RIGHT TO REQUEST AND ACT ON INSTRUCTIONS.
Administrative Agent may at any time request instructions from
Lenders with respect to any actions or approvals which by the terms of this
Agreement or of any of the Financing Documents Administrative Agent is permitted
or desires to take or to grant, 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 any action or withholding any
approval under any of the Financing Documents until it shall have received such
instructions from Required Lenders or all or such other portion of the Lenders
as shall be prescribed by this Agreement. 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 Financing Documents in accordance with the
instructions of Required Lenders (or all or such other portion of the Lenders as
shall be prescribed by this Agreement) and, notwithstanding the instructions of
Required Lenders (or such other applicable portion of the Lenders),
Administrative Agent shall have no obligation to take any action if it believes,
in good faith, that such action would violate applicable Law or exposes
Administrative Agent to any liability for which it has not received satisfactory
indemnification in accordance with the provisions of Section 13.6.
SECTION 13.8 CREDIT DECISION.
Each Lender acknowledges that it has, independently and without
reliance upon Administrative Agent or any other Lender, and based on such
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking any action under the Financing
Documents.
SECTION 13.9 COLLATERAL MATTERS.
Lenders irrevocably authorize Administrative Agent, at its option
and in its discretion, to (a) release any Lien granted to or held by
Administrative Agent under any Security Document (i) upon termination of the
Revolving Loan Commitment and payment in full of all Obligations, the
expiration, termination or cash collateralization (to the satisfaction of
Administrative Agent) of all Letters of Credit;
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or (ii) constituting property sold or disposed of as part of or in connection
with any disposition permitted under any Financing Document (it being understood
and agreed that Administrative Agent may conclusively rely without further
inquiry on a certificate of a Responsible Officer as to the sale or other
disposition of property being made in full compliance with the provisions of the
Financing Documents), and (b) release or subordinate any Lien granted to or held
by Administrative Agent under any Security Document constituting property
described in Section 5.7(b) (it being understood and agreed that Administrative
Agent may conclusively rely without further inquiry on a certificate of a
Responsible Officer as to the identification of any property described in
Section 5.7(b)). Upon request by Administrative Agent at any time, Lenders will
confirm Administrative Agent's authority to release and/or subordinate
particular types or items of Collateral pursuant to this Section 13.9.
SECTION 13.10 AGENCY FOR PERFECTION.
Administrative Agent and each Lender hereby appoint each other
Lender as agent for the purpose of perfecting Administrative Agent's security
interest in assets which, in accordance with the Uniform Commercial Code in any
applicable jurisdiction, can be perfected by possession or control. Should any
Lender (other than Administrative Agent) obtain possession or control of any
such assets, such Lender shall notify Administrative Agent thereof, and,
promptly upon Administrative Agent's request therefor, shall deliver such assets
to Administrative Agent or in accordance with Administrative Agent's
instructions or transfer control to Administrative Agent in accordance with
Administrative Agent's instructions. Each Lender agrees that it will not have
any right individually to enforce or seek to enforce any Security Document or to
realize upon any Collateral for the Revolving Loans unless instructed to do so
by Administrative Agent (or consented to by Administrative Agent, as provided in
Section 11.5), it being understood and agreed that such rights and remedies may
be exercised only by Administrative Agent.
SECTION 13.11 NOTICE OF DEFAULT.
Administrative Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default except with respect to
defaults in the payment of principal, interest and fees required to be paid to
Administrative Agent for the account of Lenders, unless Administrative Agent
shall have received written notice from a Lender or Borrower referring to this
Agreement, describing such Default or Event of Default and stating that such
notice is a "notice of default". Administrative Agent will notify each Lender of
its receipt of any such notice. Administrative Agent shall take such action with
respect to such Default or Event of Default as may be requested by Required
Lenders (or all or such other portion of the Lenders as shall be prescribed by
this Agreement), in accordance with the terms hereof. Unless and until
Administrative Agent has received any such request, Administrative Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as it shall deem
advisable or in the best interests of Lenders.
SECTION 13.12 SUCCESSOR ADMINISTRATIVE AGENT.
Administrative Agent may at any time give notice of its resignation
to Lenders and Borrower. Upon receipt of any such notice of resignation,
Required Lenders shall have the right, in consultation with Borrower, to appoint
a successor Administrative Agent. Upon the acceptance of a successor's
appointment as Administrative Agent hereunder and notice of such acceptance to
the retiring Administrative Agent, such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring (or
retired) Administrative Agent, the retiring Administrative Agent's resignation
shall become immediately effective and the retiring Administrative Agent shall
be discharged from all of its duties and obligations hereunder and under the
other Financing Documents (if such resignation was not already effective and
such duties and obligations not already discharged, as provided
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below in this paragraph). The fees payable by Borrower to a successor
Administrative Agent shall be the same as those payable to its predecessor
unless otherwise agreed in writing between Borrower and such successor. If no
such successor shall have been so appointed by Required Lenders and shall have
accepted such appointment within thirty (30) days after the retiring
Administrative Agent gives notice of its resignation, then the retiring
Administrative Agent may on behalf of the Lenders (but without any obligation)
appoint a successor Administrative Agent. From and following the expiration of
such thirty (30) day period, Administrative Agent shall have the exclusive
right, upon one (1) Business Days' notice to Borrower and Lenders, to make its
resignation effective immediately. From and following the effectiveness of such
notice, (a) the retiring Administrative Agent shall be discharged from its
duties and obligations hereunder and under the other Financing Documents and (b)
all payments, communications and determinations provided to be made by, to or
through Administrative Agent shall instead be made by or to each Lender
directly, until such time as Required Lenders appoint a successor Administrative
Agent as provided for above in this paragraph. The provisions of this Agreement
shall continue in effect for the benefit of any retiring Administrative Agent
and its sub-agents after the effectiveness of its resignation hereunder and
under the other Financing Documents in respect of any actions taken or omitted
to be taken by any of them while the retiring Administrative Agent was acting or
was continuing to act as Administrative Agent.
SECTION 13.13 DISBURSEMENTS OF REVOLVING LOANS; PAYMENT AND SHARING OF
PAYMENT.
(a) Revolving Loan Advances, Payments and Settlements; Interest and
Fee Payments.
(i) Administrative Agent shall have the right, on behalf of
Revolving Lenders (other than Non-Funding Revolving Lenders) to disburse funds
to Borrower for all Revolving Loans requested or deemed requested by Borrower
pursuant to the terms of this Agreement. Administrative Agent shall be
conclusively entitled to assume, for purposes of the preceding sentence, that
each Revolving Lender, other than any Non-Funding Revolving Lenders, will fund
its Pro Rata Share of all Revolving Loans requested by Borrower. Each Revolving
Lender (other than any Non-Funding Revolving Lender) shall reimburse
Administrative Agent on demand, in accordance with the provisions of the
immediately following paragraph, for all funds disbursed on its behalf by
Administrative Agent pursuant to the first sentence of this clause (i), or if
Administrative Agent so requests, each Revolving Lender will remit to
Administrative Agent its Pro Rata Share of any Revolving Loan before
Administrative Agent disburses the same to Borrower. If Administrative Agent
elects to require that each Revolving Lender make funds available to
Administrative Agent, prior to a disbursement by Administrative Agent to
Borrower, Administrative Agent shall advise each Revolving Lender by telephone,
facsimile or e-mail of the amount of such Revolving Lender's Pro Rata Share of
the Revolving Loan requested by Borrower no later than noon (Chicago time) on
the date of funding of such Revolving Loan, and each such Revolving Lender
shall, subject to the provisions of Article 7, pay Administrative Agent on such
date such Revolving Lender's Pro Rata Share of such requested Revolving Loan, in
same day funds, by wire transfer to the Payment Account, or such other account
as may be identified by Administrative Agent to Revolving Lenders from time to
time. If any Lender fails to pay the amount of its Pro Rata Share of any funds
advanced by Administrative Agent pursuant to the first sentence of this clause
(i) within one (1) Business Day after Administrative Agent's demand,
Administrative Agent shall promptly notify Borrower, and Borrower shall
immediately repay such amount to Administrative Agent. Any repayment required by
Borrower pursuant to this Section 13.13 shall be accompanied by accrued interest
thereon from and including the date such amount is made available to Borrower to
but excluding the date of payment at the rate of interest equal to the Base Rate
plus the Base Rate Margin for each day in such period. Nothing in this Section
13.13 or elsewhere in this Agreement or the other Financing Documents shall be
deemed to require Administrative Agent to advance funds on behalf of any Lender
or to relieve any Lender from its obligation to fulfill its commitments
hereunder or to prejudice any rights
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that Administrative Agent or Borrower may have against any Lender as a result of
any default by such Lender hereunder.
(ii) On a Business Day of each week as selected from time to
time by Administrative Agent, or more frequently (including daily), if
Administrative Agent so elects (each such day being a "SETTLEMENT DATE"),
Administrative Agent will advise each Revolving Lender by telephone, facsimile
or e-mail of the amount of each such Revolving Lender's Pro Rata Share of the
Revolving Loan balance as of the close of business of the Business Day
immediately preceding the Settlement Date. In the event that payments are
necessary to adjust the amount of such Revolving Lender's actually funded
portion of the Revolving Loans to such Lender's required Pro Rata Share of the
Revolving Loan balance as of any Settlement Date, the Revolving Lender from
which such payment is due shall pay Administrative Agent, without setoff or
discount, to the Payment Account not later than noon (Chicago time) on the
Business Day following the Settlement Date the full amount necessary to make
such adjustment. Any obligation arising pursuant to the immediately preceding
sentence shall be absolute and unconditional and shall not be affected by any
circumstance whatsoever. In the event settlement shall not have occurred by the
date and time specified in the second preceding sentence, interest shall accrue
on the unsettled amount at the Federal Funds Rate, for the first three (3) days
following the scheduled date of settlement, and thereafter at the Base Rate plus
the Base Rate Margin applicable to Revolving Loans.
(iii) On each Settlement Date, Administrative Agent shall
advise each Revolving Lender by telephone, facsimile or e-mail of the amount of
such Revolving Lender's Pro Rata Share of principal, interest and fees paid for
the benefit of Revolving Lenders with respect to each applicable Revolving Loan,
to the extent of such Revolving Lender's credit exposure with respect thereto,
and shall make payment to such Revolving Lender not later than noon (Chicago
time) on the Business Day following the Settlement Date of such amounts in
accordance with wire instructions delivered by such Revolving Lender to
Administrative Agent, as the same may be modified from time to time by written
notice to Administrative Agent; provided, however, that, in the case such
Revolving Lender is a Defaulted Lender, Administrative Agent shall be entitled
to set off the funding short-fall against that Defaulted Lender's respective
share of all payments received from Borrower.
(iv) The provisions of this Section 13.13(a) shall be deemed
to be binding upon Administrative Agent and Lenders notwithstanding the
occurrence of any Default or Event of Default, or any insolvency or bankruptcy
proceeding pertaining to Borrower or any other Credit Party.
(b) Reserved.
(c) Return of Payments.
(i) If Administrative Agent pays an amount to a Lender under
this Agreement in the belief or expectation that a related payment has been or
will be received by Administrative Agent from Borrower and such related payment
is not received by Administrative Agent, then Administrative Agent will be
entitled to recover such amount from such Lender on demand without setoff,
counterclaim or deduction of any kind, together with interest accruing on a
daily basis at the Federal Funds Rate.
(ii) If Administrative Agent determines at any time that any
amount received by Administrative Agent under this Agreement must be returned to
Borrower or paid to any other Person pursuant to any insolvency law or
otherwise, then, notwithstanding any other term or condition of this Agreement
or any other Financing Document, Administrative Agent will not be required to
distribute any portion thereof to any Lender. In addition, each Lender will
repay to Administrative Agent on demand any portion of such amount that
Administrative Agent has distributed to such Lender, together with
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interest at such rate, if any, as Administrative Agent is required to pay to
Borrower or such other Person, without setoff, counterclaim or deduction of any
kind.
(d) Defaulted Lenders. The failure of any Defaulted Lender to make
any Revolving Loan or any payment required by it hereunder shall not relieve any
other Lender of its obligations to make such Revolving Loan or payment, but
neither any other Lender nor Administrative Agent shall be responsible for the
failure of any Defaulted Lender to make a Revolving Loan or make any other
payment required hereunder. Notwithstanding anything set forth herein to the
contrary, a Defaulted Lender shall not have any voting or consent rights under
or with respect to any Financing Document or constitute a "Lender" (or be
included in the calculation of "Required Lenders" hereunder) for any voting or
consent rights under or with respect to any Financing Document.
(e) Sharing of Payments. If any Lender shall obtain any payment or
other recovery (whether voluntary, involuntary, by application of setoff or
otherwise) on account of any Revolving Loan (other than pursuant to the terms of
Section 2.9) in excess of its pro rata share of payments entitled pursuant to
the other provisions of this Section 13.13, such Lender shall purchase from the
other Lenders such participations in extensions of credit made by such other
Lenders (without recourse, representation or warranty) as shall be necessary to
cause such purchasing Lender to share the excess payment or other recovery
ratably with each of them; provided, however, that if all or any portion of the
excess payment or other recovery is thereafter recovered from such purchasing
Lender, the purchase shall be rescinded and each Lender which has sold a
participation to the purchasing Lender shall repay to the purchasing Lender the
purchase price to the ratable extent of such recovery, without interest.
Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this clause (e) may, to the fullest extent permitted by law,
exercise all its rights of payment (including pursuant to Section 11.5) with
respect to such participation as fully as if such Lender were the direct
creditor of Borrower in the amount of such participation. If under any
applicable bankruptcy, insolvency or other similar law, any Lender receives a
secured claim in lieu of a setoff to which this clause (e) applies, such Lender
shall, to the extent practicable, exercise its rights in respect of such secured
claim in a manner consistent with the rights of the Lenders entitled under this
clause (e) to share in the benefits of any recovery on such secured claim.
(f) Participations in Support Agreements and Lender Letters of
Credit.
(i) Concurrently with the issuance of each Supported Letter of
Credit, Administrative Agent shall be deemed to have sold and transferred to
each Revolving Lender (other than any Non-Funding Revolving Lenders at the time
of such issuance), and each such Revolving Lender shall be deemed irrevocably
and immediately to have purchased and received from Administrative Agent,
without recourse or warranty, an undivided interest and participation in, to the
extent of such Lender's Pro Rata Share of the Revolving Loan Commitment,
Administrative Agent's Support Agreement liabilities and obligations in respect
of such Letters of Credit and Borrower's Reimbursement Obligations with respect
thereto. Concurrently with the issuance of each Lender Letter of Credit, the LC
Issuer in respect thereof shall be deemed to have sold and transferred to each
Revolving Lender (other than any Non-Funding Revolving Lenders at the time of
such issuance), and each such Revolving Lender shall be deemed irrevocably and
immediately to have purchased and received from such LC Issuer, without recourse
or warranty, an undivided interest and participation in, to the extent of such
Lender's Pro Rata Share of the Revolving Loan Commitment, such Lender Letter of
Credit and Borrower's Reimbursement Obligations with respect thereto. Any
purchase obligation arising pursuant to the immediately two preceding sentences
shall be absolute and unconditional and shall not be affected by any
circumstances whatsoever.
(ii) If either (x) Administrative Agent makes any payment or
disbursement under any Support Agreement and/or (y) an LC Issuer makes any
payment or disbursement under any
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Lender Letter of Credit, and (A) Borrower has not reimbursed Administrative
Agent or the applicable LC Issuer, as applicable, in full for such payment or
disbursement in accordance with Section 2.5(c), or (B) any reimbursement
received by Administrative Agent or any LC Issuer is or must be returned or
rescinded upon or during any bankruptcy or reorganization of any Credit Party or
otherwise, each Revolving Lender (other than any Revolving Lender that was a
Non-Funding Revolving Lender at the time of the issuance of such Supported
Letter of Credit or Lender Letter of Credit) shall be irrevocably and
unconditionally obligated to pay to Administrative Agent or the applicable LC
Issuer, as applicable, its Pro Rata Share of such payment or disbursement (but
no such payment shall diminish the Obligations of Borrower under Section
2.5(c)). To the extent any such Revolving Lender shall not have made such amount
available to Administrative Agent or the applicable LC Issuer, as applicable, by
noon (Chicago time) on the Business Day on which such Lender receives notice
from Administrative Agent or the applicable LC Issuer, as applicable, of such
payment or disbursement, such Lender agrees to pay interest on such amount to
Administrative Agent or the applicable LC Issuer, as applicable, forthwith on
demand accruing daily at the Federal Funds Rate, for the first three (3) days
following such Lender's receipt of such notice, and thereafter at the Base Rate
plus the Base Rate Margin in respect of Revolving Loans. Any Revolving Lender's
failure to make available to Administrative Agent or the applicable LC Issuer,
as applicable, its Pro Rata Share of any such payment or disbursement shall not
relieve any other Lender of its obligation hereunder to make available such
other Revolving Lender's Pro Rata Share of such payment, but no Revolving Lender
shall be responsible for the failure of any other Lender to make available such
other Lender's Pro Rata Share of any such payment or disbursement.
(g) Reserved.
(h) Overadvances. If Borrower requests that Revolving Lenders make,
or permit to remain outstanding, Revolving Loans in an aggregate principal
amount in excess of the then existing Borrowing Base minus the then existing
Letter of Credit Liabilities, Required Lenders may in their discretion elect to
cause all Revolving Lenders to make, or permit to remain outstanding, such
excess Revolving Loans (such excess Revolving Loans being referred to as
"OVERADVANCE REVOLVING LOANS"), provided, however, that such Lenders may not at
any time cause all Revolving Lenders to make, or permit to remain outstanding,
(a) Revolving Loans in excess of the Revolving Loan Commitment minus the Letter
of Credit Liabilities or (b) Overadvance Revolving Loans in excess of 5% of the
Revolving Loan Commitment. If Overadvance Revolving Loans are made, or permitted
to remain outstanding, pursuant to the preceding sentence, then (a) clause (ii)
of the definition of Revolving Loan Limit shall be deemed increased by the
amount of such permitted Overadvance Revolving Loans, but only for so long as
Required Lenders allow such Overadvance Revolving Loans to be outstanding and
(b) all Revolving Lenders shall be bound to make, or permit to remain
outstanding such Overadvance Revolving Loans based upon their Pro Rata Shares of
the Revolving Loan Commitment in accordance with the terms of this Agreement.
SECTION 13.14 RIGHT TO PERFORM, PRESERVE AND PROTECT.
If any Credit Party fails to perform any obligation hereunder or
under any other Financing Document, Administrative Agent itself may, but shall
not be obligated to, cause such obligation to be performed at Borrower's
expense. Administrative Agent is further authorized by Borrower and the Lenders
to make expenditures from time to time which Administrative Agent, in its
reasonable business judgment, deems necessary or desirable to (i) preserve or
protect the business conducted by the Credit Parties, the Collateral, or any
portion thereof and/or (ii) enhance the likelihood of, or maximize the amount
of, repayment of the Revolving Loans and other Obligations. Borrower hereby
agrees to reimburse Administrative Agent on demand for any and all costs,
liabilities and obligations incurred by Administrative Agent pursuant to this
Section 13.14. Each Lender hereby agrees to indemnify Administrative Agent upon
demand for any and all costs, liabilities and obligations incurred
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by Administrative Agent pursuant to this Section 13.14, in accordance with the
provisions of Section 13.6.
SECTION 13.15 ADDITIONAL TITLED AGENTS.
Except for rights and powers, if any, expressly reserved under this
Agreement to any bookrunner, arranger or to any titled agent named on the cover
page of this Agreement, other than Administrative Agent (collectively, the
"ADDITIONAL TITLED AGENTS"), and except for obligations, liabilities, duties and
responsibilities, if any, expressly assumed under this Agreement by any
Additional Titled Agent, no Additional Titled Agent, in such capacity, has any
rights, powers, liabilities, duties or responsibilities hereunder or under any
of the other Financing Documents. Without limiting the foregoing, no Additional
Titled Agent shall have nor be deemed to have a fiduciary relationship with any
Lender. At any time that any Lender serving as an Additional Titled Agent shall
have transferred to any other Person (other than any Affiliates) all of its
interests in the Revolving Loans and in the Revolving Loan Commitment, such
Lender shall be deemed to have concurrently resigned as such Additional Titled
Agent.
SECTION 13.16 AMENDMENTS AND WAIVERS.
(a) In addition to the required signatures under Section 14.5, no
provision of this Agreement or any other Financing Document may be amended,
waived or otherwise modified unless such amendment, waiver or other modification
is in writing and is signed or otherwise approved by the following Persons:
(i) if any amendment, waiver or other modification would
either increase a Lender's Revolving Loan Commitment Amount, by such Lender;
and/or
(ii) if the rights or duties of Administrative Agent and/or LC
Issuer are affected thereby, by Administrative Agent and/or LC Issuer, as the
case may be;
provided that, in each of (i) and (ii) above, no such amendment, waiver or
other modification shall, unless signed by all the Lenders directly affected
thereby, (i) reduce the principal of, rate of interest on or any fees with
respect to any Revolving Loan or Reimbursement Obligation or forgive any
principal, interest (other than default interest) or fees (other than late
charges) with respect to any Revolving Loan or Reimbursement Obligation; (ii)
postpone the date fixed for, or waive, any payment of principal of any Revolving
Loan, or of any Reimbursement Obligation or of interest on any Revolving Loan or
any Reimbursement Obligation (other than default interest) or any fees provided
for hereunder (other than late charges) or for any termination of any
commitment; (iii) change the definition of the term Required Lenders or the
percentage of Lenders which shall be required for Lenders to take any action
hereunder; (iv) release any Property or all or substantially all of the other
Collateral, authorize any Credit Party to sell or otherwise dispose of any
Property or all or substantially all of the other Collateral or release any
Guarantor of all or any portion of the Obligations of its Guarantee obligations
with respect thereto, except, in each case with respect to this clause (iv), as
otherwise may be provided in this Agreement or the other Financing Documents
(including in connection with any disposition permitted hereunder or
thereunder); (v) amend, waive or otherwise modify this Section 13.16(a) or the
definitions of the terms used in this Section 13.16(a) insofar as the
definitions affect the substance of this Section 13.16(a); or (vi) consent to
the assignment, delegation or other transfer by any Credit Party of any of its
rights and obligations under any Financing Document or release any Credit Party
of its payment obligations under any Financing Document, except, in each case
with respect to this clause (vi), pursuant to a merger or consolidation
permitted pursuant to this Agreement. It is hereby understood and agreed that
all Lenders
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shall be deemed directly affected by an amendment, waiver or other modification
of the type described in the preceding clauses (iii), (iv), (v) and (vi) of the
preceding sentence.
(b) Without limitation of the provisions of the preceding clause
(a), no amendment, waiver or other modification to this Agreement shall, unless
signed by Required Lenders, (i) increase any of the advance rates set forth in
the Borrowing Base Certificate, (ii) make less restrictive the calculation of
the Borrowing Base; (iii) amend, waive or otherwise modify Section 2.2(a) or the
definitions of the terms used in Section 2.2(a) insofar as the definitions
affect the substance of such Section; (iv) change the definition of the term
Required Lenders or the percentage of Lenders which shall be required for
Required Lenders to take any action hereunder or (v) amend, waive or otherwise
modify this Section 13.16(b) or the definitions of the terms used in this
Section 13.16(b) insofar as the definitions affect the substance of this Section
13.16(b).
SECTION 13.17 ASSIGNMENTS AND PARTICIPATIONS.
(a) Any Lender may at any time assign to one or more Eligible
Assignees all or any portion of such Lender's Revolving Loans and interest in
the Revolving Loan Commitment, together with all related obligations of such
Lender hereunder. Except as Administrative Agent may otherwise agree, the amount
of any such assignment (determined as of the date of the applicable Assignment
Agreement or, if a "Trade Date" is specified in such Assignment Agreement, as of
such Trade Date) shall be in a minimum aggregate amount equal to $2,500,000 or,
if less, the assignor's entire interests in the Revolving Loan Commitment and
outstanding Revolving Loans; provided, however, that, in connection with
simultaneous assignments to two or more related Approved Funds, such Approved
Funds shall be treated as one assignee for purposes of determining compliance
with the minimum assignment size referred to above. Borrower and Administrative
Agent shall be entitled to continue to deal solely and directly with such Lender
in connection with the interests so assigned to an Eligible Assignee until
Administrative Agent shall have received and accepted an effective Assignment
Agreement executed, delivered and fully completed by the applicable parties
thereto and a processing fee of $3,500; provided, however, only one processing
fee shall be payable in connection with simultaneous assignments to two or more
related Approved Funds.
(b) From and after the date on which the conditions described above
have been met, (i) such Eligible Assignee shall be deemed automatically to have
become a party hereto and, to the extent of the interests assigned to such
Eligible Assignee pursuant to such Assignment Agreement, shall have the rights
and obligations of a Lender hereunder, and (ii) the assigning Lender, to the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment Agreement, shall be released from its rights and obligations
hereunder (other than those that survive termination pursuant to Section 14.1).
Upon the request of the Eligible Assignee (and, as applicable, the assigning
Lender) pursuant to an effective Assignment Agreement, Borrower shall execute
and deliver to Administrative Agent for delivery to the Eligible Assignee (and,
as applicable, the assigning Lender) Notes in the aggregate principal amount of
the Eligible Assignee's percentage interest in the Revolving Loan Commitment
(and, as applicable, Notes in the principal amount of that portion of the
Revolving Loan Commitment retained by the assigning Lender). Upon receipt by the
assigning Lender of such Note, the assigning Lender shall return to Borrower any
prior Note held by it.
(c) Notwithstanding the foregoing provisions of this Section 13.17
or any other provision of this Agreement, any Lender may at any time pledge or
assign a security interest in all or any portion of its rights under this
Agreement to secure obligations of such Lender, including any pledge or
assignment to secure obligations to a Federal Reserve Bank; provided, however,
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
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(d) Notwithstanding the foregoing provisions of this Section 13.17
or any other provision of this Agreement, Administrative Agent has the right,
but not the obligation, to effectuate assignments of Revolving Loans and
Revolving Loan Commitments via an electronic settlement system acceptable to
Administrative Agent as designated in writing from time to time to the Lenders
by Administrative Agent (the "SETTLEMENT SERVICE"). At any time when
Administrative Agent elects, in its sole discretion, to implement such
Settlement Service, each such assignment shall be effected by the assigning
Lender and proposed assignee pursuant to the procedures then in effect under the
Settlement Service, which procedures shall be consistent with the other
provisions of this Section 13.17. Each assigning Lender and proposed Eligible
Assignee shall comply with the requirements of the Settlement Service in
connection with effecting any assignment of Revolving Loans and Revolving Loan
Commitments pursuant to the Settlement Service. If so elected by each of
Administrative Agent and Borrower, Administrative Agent's and Borrower's
approval of such Eligible Assignee shall be deemed to have been automatically
granted with respect to any transfer effected through the Settlement Service.
Assignments and assumptions of the Revolving Loans and Revolving Loan
Commitments shall be effected by the provisions otherwise set forth herein until
Administrative Agent notifies Lenders of the Settlement Service as set forth
herein.
(e) Participations. Any Lender may at any time, without the consent
of, or notice to, Borrower or Administrative Agent, sell to one or more Persons
participating interests in its Revolving Loans, commitments or other interests
hereunder (any such Person, a "PARTICIPANT"). In the event of a sale by a Lender
of a participating interest to a Participant, (i) such Lender's obligations
hereunder shall remain unchanged for all purposes, (ii) Borrower and
Administrative Agent shall continue to deal solely and directly with such Lender
in connection with such Lender's rights and obligations hereunder, and (iii) all
amounts payable by Borrower shall be determined as if such Lender had not sold
such participation and shall be paid directly to such Lender. No Participant
shall have any direct or indirect voting rights hereunder except with respect to
any event described in Section 13.16 expressly requiring the unanimous vote of
all Lenders or, as applicable, all affected Lenders. Each Lender agrees to
incorporate the requirements of the preceding sentence into each participation
agreement which such Lender enters into with any Participant. Borrower agrees
that if amounts outstanding under this Agreement are due and payable (as a
result of acceleration or otherwise), each Participant shall be deemed to have
the right of set-off in respect of its participating interest in amounts owing
under this Agreement and with respect to any Letter of Credit to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement; provided, however, that such right of set-off shall
be subject to the obligation of each Participant to share with Lenders, and
Lenders agree to share with each Participant, as provided in Section 11.5.
(f) Replacement of Lenders. Within thirty (30) days after: (i)
receipt by Administrative Agent of notice and demand from any Lender for payment
of additional costs as provided in Section 2.9, which demand shall not have been
revoked, (ii) Borrower is required to pay any additional amount to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section
2.8, (iii) any Lender is a Defaulted Lender, and the circumstances causing such
status shall not have been cured or waived; or (iv) any failure by any Lender to
consent to a requested amendment, waiver or modification to any Financing
Document in which Required Lenders have already consented to such amendment,
waiver or modification but the consent of each Lender, or each Lender affected
thereby, is required with respect thereto (each relevant Lender in the foregoing
clauses (i) through (iv) being an "AFFECTED LENDER") each of Borrower and
Administrative Agent may, at its option, notify such Affected Lender and, in the
case of Borrower's election, Administrative Agent, of such Person's intention to
obtain, at Borrower's expense, a replacement Lender ("REPLACEMENT LENDER") for
such Lender, which Replacement Lender shall be an Eligible Assignee and, in the
event the Replacement Lender is to replace an Affected Lender described in the
preceding clause (iv), such Replacement Lender consents to the requested
amendment, waiver or modification making the replaced Lender an Affected Lender.
In the
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event Borrower or Administrative Agent, as applicable, obtains a Replacement
Lender within ninety (90) days following notice of its intention to do so, the
Affected Lender shall sell, at par, and assign all of its Revolving Loans and
Revolving Loan Commitments hereunder to such Replacement Lender in accordance
with the procedures set forth in Section 13.17(a); provided, however, that (x)
Borrower shall have reimbursed such Lender for its increased costs and
additional payments for which it is entitled to reimbursement under any of
Section 2.8 or Section 2.9, as applicable, of this Agreement through the date of
such sale and assignment, and (y) Administrative Agent shall have received the
$3,500 processing fee in respect of such assignment. In the event that a
replaced Lender does not execute an Assignment Agreement pursuant to Section
13.17(a) within five (5) Business Days after receipt by such replaced Lender of
notice of replacement pursuant to this Section 13.17(f) and presentation to such
replaced Lender of an Assignment Agreement evidencing an assignment pursuant to
this Section 13.17(f), such replaced Lender shall be deemed to have consented to
the terms of such Assignment Agreement, and any such Assignment Agreement
executed by Administrative Agent, the Replacement Lender and, to the extent
required pursuant to Section 13.17(a), Borrower, shall be effective for purposes
of this Section 13.17(f) and Section 13.17(a). Upon any such assignment and
payment, such replaced Lender shall no longer constitute a "Lender" for purposes
hereof, other than with respect to such rights and obligations that survive
termination as set forth in Section 14.1
SECTION 13.18 DEFINITIONS.
As used in this Article 13, the following terms have the following
meanings:
"ADDITIONAL TITLED AGENTS" has the meaning set forth in Section
13.15.
"AFFECTED LENDER" has the meaning set forth in Section 13.17(f).
"APPROVED FUND" means any (a) investment company, fund, trust,
securitization vehicle or conduit that is (or will be) engaged in making,
purchasing, holding or otherwise investing in commercial loans and similar
extensions of credit in the ordinary course of its business, or (b) any Person
(other than a natural person) which temporarily warehouses loans for any Lender
or any entity described in the preceding clause (a) and that, with respect to
each of the preceding clauses (a) and (b), is administered or managed by (i) a
Lender, (ii) an Affiliate of a Lender, or (iii) a Person (other than a natural
person) or an Affiliate of a Person (other than a natural person) that
administers or manages a Lender.
"DEFAULTED LENDER" means, so long as such failure shall remain in
existence and uncured, any Lender which shall have failed to make any Revolving
Loan or other credit accommodation, disbursement or reimbursement required
pursuant to the terms of any Financing Document.
"ELIGIBLE ASSIGNEE" means (a) a Lender, (b) an Affiliate of a
Lender, (c) an Approved Fund, and (d) any other Person (other than a natural
person) approved by (i) Administrative Agent, and (ii) unless an Event of
Default has occurred and is continuing, Borrower (such approval of Borrower not
to be unreasonably withheld or delayed, and shall be deemed provided unless
expressly withheld by Borrower within three (3) Business Days of request
therefor); provided, however, that notwithstanding the foregoing, (x) "Eligible
Assignee" shall not include any Credit Party or any of a Credit Party's
Affiliates or Subsidiaries, and (y) no proposed assignee intending to assume all
or any portion of the Revolving Loan Commitment shall be an Eligible Assignee
unless such proposed assignee either already holds a portion of the Revolving
Loan Commitment, or has been approved as an Eligible Assignee by Administrative
Agent.
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"FEDERAL FUNDS RATE" means, for any day, the rate of interest per
annum (rounded upwards, if necessary, to the nearest whole multiple of 1/100 of
1%) equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day, provided, however, that (a) if
such day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day and (b) if no
such rate is so published on such next preceding Business Day, the Federal Funds
Rate for such day shall be the average rate quoted to Administrative Agent on
such day on such transactions as determined by Administrative Agent.
"OVERADVANCE REVOLVING LOANS" has the meaning set forth in Section
13.13(h).
"PARTICIPANT" has the meaning set forth in Section 13.17(e).
"REPLACEMENT LENDER" has the meaning set forth in Section 13.17(f).
"SETTLEMENT DATE" has the meaning set forth in Section 13.13(a)(ii).
"SETTLEMENT SERVICE" has the meaning set forth in Section 13.17(d).
ARTICLE 14
MISCELLANEOUS
SECTION 14.1 SURVIVAL.
All agreements, representations and warranties made herein and in
every other Financing Document shall survive the execution and delivery of this
Agreement and the other Financing Documents and the other Operative Documents.
The provisions of Sections 2.8 and 2.9 and Articles 9, 10 and 11 shall survive
the payment of the Obligations (both with respect to any Lender and all Lenders
collectively) and any termination of this Agreement.
SECTION 14.2 NO WAIVERS.
No failure or delay by Administrative Agent or any Lender in
exercising any right, power or privilege under any Financing Document shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies herein and therein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.
Any reference in any Financing Document to the "continuing" nature of any Event
of Default shall not be construed as establishing or otherwise indicating that
Borrower or any other Credit Party has the independent right to cure any such
Event of Default, but is rather presented merely for convenience should such
Event of Default be waived in accordance with the terms of the applicable
Financing Documents.
SECTION 14.3 NOTICES.
(a) All notices, requests and other communications to any party
hereunder shall be in writing (including prepaid overnight courier, facsimile
transmission or similar writing) and shall be given to such party at its
address, facsimile number or e-mail address set forth on the signature pages
hereof (or, in the case of any such Lender who becomes a Lender after the date
hereof, in an Assignment Agreement or in a notice delivered to Borrower and
Administrative Agent by the assignee Lender forthwith upon such assignment) or
at such other address, facsimile number or e-mail address as such party may
hereafter
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specify for the purpose by notice to Administrative Agent and Borrower;
provided, however, that notices, requests or other communications shall be
permitted by electronic means only in accordance with the provisions of Section
14.3(b). Each such notice, request or other communication shall be effective (i)
if given by facsimile, when such notice is transmitted to the facsimile number
specified by this Section and the sender receives a confirmation of transmission
from the sending facsimile machine, or (ii) if given by mail, prepaid overnight
courier or any other means, when received or when receipt is refused at the
applicable address specified by this Section.
(b) Notices and other communications to the parties hereto may be
delivered or furnished by electronic communication (including e-mail and
Internet or intranet websites) pursuant to procedures approved from time to time
by Administrative Agent, provided, however, that the foregoing shall not apply
to notices sent directly to any Lender if such Lender has notified
Administrative Agent that it is incapable of receiving notices by electronic
communication. Administrative Agent or Borrower may, in its discretion, agree to
accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it, provided, however, that
approval of such procedures may be limited to particular notices or
communications.
(c) Unless Administrative Agent otherwise prescribes, (i) notices
and other communications sent to an e-mail address shall be deemed received upon
the sender's receipt of an acknowledgment from the intended recipient (such as
by the "return receipt requested" function, as available, return e-mail or other
written acknowledgment), and (ii) notices or communications posted to an
Internet or intranet website shall be deemed received upon the deemed receipt by
the intended recipient at its e-mail address as described in the foregoing
clause (i) of notification that such notice or communication is available and
identifying the website address therefor, provided, however, that if any such
notice or other communication is not sent or posted during normal business
hours, such notice or communication shall be deemed to have been sent at the
opening of business on the next Business Day.
SECTION 14.4 SEVERABILITY.
In case any provision of or obligation under this Agreement or any
other Financing Document 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.
SECTION 14.5 AMENDMENTS AND WAIVERS.
No provision of this Agreement or any other Financing Document may
be amended, waived or otherwise modified unless such amendment, waiver or other
modification is in writing and is signed or otherwise approved by Borrower, the
Required Lenders and any other Lender to the extent required under Section
13.16.
SECTION 14.6 ASSIGNMENTS; PARTICIPATIONS.
(a) Assignments by Lenders.
(i) The rights of each Lender to assign or grant
participations in all or any portion of such Lender's Revolving Loans and
interest in the Revolving Loan Commitment shall be governed by Article 13.
(ii) Administrative Agent, acting solely for this purpose as
an agent of Borrower, shall maintain at its offices located in Chicago, Illinois
a copy of each Assignment Agreement
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delivered to it and a register for the recordation of the names and addresses of
each Lender, and the commitments of, and principal amount of the Revolving Loans
owing to, such Lender pursuant to the terms hereof. The entries in such register
shall be conclusive, and Borrower, Administrative Agent and Lenders may treat
each Person whose name is recorded therein pursuant to the terms hereof as a
Lender hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary. Such register shall be available for inspection by Borrower and
any Lender, at any reasonable time upon reasonable prior notice to
Administrative Agent.
(b) Credit Party Assignments. Except as otherwise expressly provided
in this Agreement, no Credit Party may assign, delegate or otherwise transfer
any of its rights or other obligations under any other Financing Document
without the prior written consent of Administrative Agent and each Lender.
SECTION 14.7 HEADINGS.
Headings and captions used in the Financing Documents (including the
Exhibits, Schedules and Annexes hereto and thereto) are included for convenience
of reference only and shall not be given any substantive effect.
SECTION 14.8 CONFIDENTIALITY.
Administrative Agent and each Lender shall hold all non-public
information regarding the Credit Parties and their respective businesses
identified as such by the Credit Parties and obtained by Administrative Agent or
any Lender pursuant to the requirements hereof in accordance with such Person's
customary procedures for handling information of such nature, except that
disclosure of such information may be made (a) to their respective agents,
employees, Subsidiaries, Affiliates, attorneys, auditors, professional
consultants, rating agencies, insurance industry associations and portfolio
management services, (b) prospective transferees or purchasers of any interest
in the Revolving Loans, provided, however, that any such Persons shall have
agreed to be bound by the provisions of this Section 14.8, (c) as required by
Law, subpoena, judicial order or similar order and in connection with any
litigation, (d) as may be required in connection with the examination, audit or
similar investigation of such Person, and (e) to a Person that is a trustee,
investment advisor, collateral manager, servicer, noteholder or secured party in
a Securitization (as hereinafter defined) in connection with the administration,
servicing and reporting on the assets serving as collateral for such
Securitization. For the purposes of this Section, "Securitization" shall mean a
public or private offering by a Lender or any of its Affiliates or their
respective successors and assigns, of securities which represent an interest in,
or which are collateralized, in whole or in party, by the Revolving Loans.
Confidential information shall include only such information identified as such
at the time provided to Administrative Agent and shall not include information
that either: (i) is in the public domain, or becomes part of the public domain
after disclosure to such Person through no fault of such Person, or (ii) is
disclosed to such Person by a Person other than a Credit Party, provided,
however, Administrative Agent does not have actual knowledge that such Person is
prohibited from disclosing such information. The obligations of Administrative
Agent and Lenders under this Section 14.8 shall supersede and replace the
obligations of Administrative Agent and Lenders under any confidentiality
agreement in respect of this financing executed and delivered by Administrative
Agent or any Lender prior to the date hereof.
SECTION 14.9 WAIVER OF CONSEQUENTIAL AND OTHER DAMAGES.
To the fullest extent permitted by applicable law, Borrower shall
not assert, and Borrower hereby waives, any claim against any Indemnitee, on any
theory of liability, for special, indirect, consequential or punitive damages
(as opposed to direct or actual damages) arising out of, in connection
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with, or as a result of this Agreement, any other Financing Document or any
agreement or instrument contemplated hereby or thereby, the transactions
contemplated hereby or thereby, any Revolving Loan or Letter of Credit or the
use of the proceeds thereof. No Indemnitee shall be liable for any damages
arising from the use by unintended recipients of any information or other
materials distributed by it through telecommunications, electronic or other
information transmission systems in connection with this Agreement or the other
Financing Documents or the transactions contemplated hereby or thereby.
SECTION 14.10 GOVERNING LAW; SUBMISSION TO JURISDICTION.
THIS AGREEMENT, EACH NOTE AND EACH OTHER FINANCING DOCUMENT, AND ALL
MATTERS RELATING HERETO OR THERETO OR ARISING THEREFROM (WHETHER SOUNDING IN
CONTRACT LAW, TORT LAW OR OTHERWISE), SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS,
WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES EXCEPT AS PROVIDED IN ANY
SECURITY DOCUMENT. BORROWER HEREBY CONSENTS TO THE JURISDICTION OF ANY STATE OR
FEDERAL COURT LOCATED WITHIN CHICAGO, STATE OF ILLINOIS AND IRREVOCABLY AGREES
THAT, SUBJECT TO ADMINISTRATIVE AGENT'S ELECTION, ALL ACTIONS OR PROCEEDINGS
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER FINANCING DOCUMENTS
SHALL BE LITIGATED IN SUCH COURTS. BORROWER EXPRESSLY SUBMITS AND CONSENTS TO
THE JURISDICTION OF THE AFORESAID COURTS AND WAIVES ANY DEFENSE OF FORUM NON
CONVENIENS. BORROWER HEREBY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS AND
AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE UPON BORROWER BY CERTIFIED
OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO BORROWER AT THE
ADDRESS SET FORTH IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN
(10) DAYS AFTER THE SAME HAS BEEN POSTED.
SECTION 14.11 WAIVER OF JURY TRIAL.
EACH OF BORROWER, ADMINISTRATIVE AGENT AND THE LENDERS HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THE FINANCING DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED THEREBY AND AGREES THAT ANY SUCH ACTION OR PROCEEDING
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY. EACH OF BORROWER,
ADMINISTRATIVE AGENT AND EACH LENDER ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE
WAIVER IN ENTERING INTO THIS AGREEMENT AND THE OTHER FINANCING DOCUMENTS, AND
THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS.
EACH OF BORROWER, ADMINISTRATIVE AGENT AND EACH LENDER WARRANTS AND REPRESENTS
THAT EACH HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL
COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.
SECTION 14.12 PUBLICATION; ADVERTISEMENT.
(a) Publication. Borrower shall not, and shall cause each other
Credit Party not to, directly or indirectly publish, disclose or otherwise use
in any public disclosure, advertising material, promotional material, press
release or interview, any reference to the name, logo or any trademark of
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Merrill Lynch or any of its Affiliates or any reference to this Agreement or the
financing evidenced hereby, in any case except (i) as required by Law, subpoena
or judicial or similar order, in which case the applicable Credit Party shall
give Administrative Agent prior written notice of such publication or other
disclosure, or (ii) with Merrill Lynch's prior written consent.
(b) Advertisement. Each Lender and Borrower hereby authorizes
Merrill Lynch to publish the name of such Lender and each Credit Party, the
existence of the financing arrangements referenced under this Agreement, the
primary purpose and/or structure of those arrangements, the amount of credit
extended under each facility, the title and role of each party to this
Agreement, and the total amount of the financing evidenced hereby in any
"tombstone", comparable advertisement or press release which Merrill Lynch
elects to submit for publication. In addition, each Lender and Borrower agrees
that Merrill Lynch may provide lending industry trade organizations with
information necessary and customary for inclusion in league table measurements
after the Closing Date. With respect to any of the foregoing, Merrill Lynch
shall provide Borrower with an opportunity to review and confer with Merrill
Lynch regarding the contents of any such tombstone, advertisement or
information, as applicable, prior to its submission for publication and,
following such review period, Merrill Lynch may, from time to time, publish such
information in any media form desired by Merrill Lynch, until such time that
Borrower shall have requested Merrill Lynch cease any such further publication.
SECTION 14.13 COUNTERPARTS; INTEGRATION.
This Agreement and the other Financing Documents may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
Signatures by facsimile shall bind the parties hereto. This Agreement and the
other Financing Documents constitute the entire agreement and understanding
among the parties hereto and supersede any and all prior agreements and
understandings, oral or written, relating to the subject matter hereof.
SECTION 14.14 NO STRICT CONSTRUCTION.
The parties hereto have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties hereto and no presumption or burden of proof shall arise favoring
or disfavoring any party by virtue of the authorship of any provisions of this
Agreement.
SECTION 14.15 LENDER APPROVALS.
Unless expressly provided herein to the contrary, any approval,
consent, waiver or satisfaction of Administrative Agent or Lenders with respect
to any matter that is the subject of this Agreement, the other Financing
Documents may be granted or withheld by Administrative Agent and Lenders in
their sole and absolute discretion and credit judgment.
SECTION 14.16 WAIVERS.
BORROWER WAIVES THE BENEFIT OF ANY AND EVERY STATUTE, ORDINANCE, OR
RULE OF COURT WHICH MAY BE LAWFULLY WAIVED CONFERRING UPON BORROWER ANY RIGHT OR
PRIVILEGE OF EXEMPTION, HOMESTEAD RIGHTS, STAY OF EXECUTION, OR SUPPLEMENTARY
PROCEEDINGS, OR OTHER RELIEF FROM THE ENFORCEMENT OR IMMEDIATE ENFORCEMENT OF A
JUDGMENT OR RELATED PROCEEDINGS ON A JUDGMENT.
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SECTION 14.17 RELEASE OF ADMINISTRATIVE AGENT AND LENDERS.
Borrower, voluntarily, knowingly, unconditionally, and irrevocably,
with specific and express intent, for and on behalf of itself and its agents,
attorneys, heirs, successors, and assigns (collectively the "RELEASING PARTIES")
does hereby fully and completely release, acquit and forever discharge each
Indemnitee, and any other person, firm, business, corporation, insurer, or
association which may be responsible or liable for the acts or omissions of any
Indemnitee, or who may be liable for the injury or damage resulting therefrom
(collectively the "RELEASED PARTIES"), of and from any and all actions, causes
of action, suits, debts, disputes, damages, claims, obligations, liabilities,
costs, expenses and demands of any kind whatsoever, at law or in equity, whether
matured or unmatured, liquidated or unliquidated, vested or contingent, choate
or inchoate, known or unknown that the Releasing Parties (or any of them) has
against the Released Parties or any of them (whether directly or indirectly);
provided, that the foregoing release shall not apply to any such actions, causes
of action, suits, debts, disputes, damages, claims, obligations, liabilities,
costs, expenses or demands the Releasing Parties have against any Lender as a
result of such Lender's failure to fund its Pro Rata Share of any Revolving Loan
that such Lender was obligated to fund pursuant to this Agreement. The foregoing
release shall be deemed renewed and reaffirmed as of the date of each advance of
proceeds under any Revolving Loans and each other accommodation made or granted
to Borrower by any Released Party under any Financing Document. Borrower
acknowledges that the foregoing release is a material inducement to
Administrative Agent's and each Lender's decision to extend to Borrower the
financial accommodations hereunder and has been relied upon by Administrative
Agent and each Lender in agreeing to extend the credit herein contemplated and
in making each advance or other accommodation hereunder.
SECTION 14.18 KNOWLEDGE.
Whenever a statement in this Agreement or in any other Financing
Document is qualified by "to the best of Borrower's [or another Credit Party's]
knowledge" or a similar phrase, it is intended to indicate that none of Edward
K. Aldag, Jr., Emmett E. McLean, R. Steven Hamner nor any other principal
officer of Borrower or such Credit Party has any current actual knowledge of the
inaccuracy of any such statement, after such investigation as deemed reasonably
appropriate by such person, to determine the accuracy of any such statement.
[SIGNATURES APPEAR ON FOLLOWING PAGES]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
BORROWER:
MPT OPERATING PARTNERSHIP, L.P.
By: R. Steven Hamner
Name: R. Steven Hamner
Title: EVP and CFO
Address:
c/o Medical Properties Trust, Inc.
1000 Urban Center Drive, Suite 501
Birmingham, AL 35242
Attn: Michael G. Stewart
Phone: (205) 969-3755
Facsimile: (205) 969-3756
Borrower's Account Designation:
Colonial Bank, National Association
ABA No.: 062-001-319
Account No.: 36390287
Account Name: MPT Operating Partnership, L.P.
SIGNATURE PAGE TO CREDIT AGREEMENT S-1
ADMINISTRATIVE AGENT:
MERRILL LYNCH CAPITAL, A DIVISION OF
MERRILL LYNCH BUSINESS FINANCIAL SERVICES INC.,
as Administrative Agent and a Lender
By: Garrett W. Fletcher
Name: Garrett W. Fletcher
Title: VP
Address:
222 N. LaSalle Street, 16th Floor
Chicago, Illinois 60601
Attn: Account Manager for MLC-HCF Medical
Properties Trust, Inc. transaction
Facsimile: 1-866-264-3051
E-Mail: MLC_RE1@ml.com
With copies to:
Merrill Lynch Capital
222 N. LaSalle Street, 16th Floor
Chicago, Illinois 60601
Attn: Group Senior Transaction Attorney,
Healthcare Finance
Facsimile Number: (312) 499-3245
Merrill Lynch Capital
7700 Wisconsin Ave., Suite 400
Bethesda, Maryland 20814
Attn: Group Senior Transaction Attorney,
Healthcare Finance
Facsimile Number: (866) 341-9053
And with an additional copy to:
Blank Rome LLP
405 Lexington Avenue
New York, New York 10174
Attn: Scott R. Smith
Facsimile: (917) 332-3711
E-Mail: ssmith@blankrome.com
Payment Account Designation:
LaSalle Bank
200 West Monroe
Chicago, IL 60606
ABA #: 071000505
Account Name: MLBFS Healthcare Finance
Account #: 5800395088
Attention: Medical Properties Trust, Inc.
LENDERS:
MERRILL LYNCH CAPITAL, A DIVISION OF
MERRILL LYNCH BUSINESS FINANCIAL SERVICES
INC., AS LENDER
By: /s/ Garrett W. Fletcher
Name: Garrett W. Fletcher
Title: VP
Address:
222 N. LaSalle Street, 16th Floor
Chicago, Illinois 60601
Attn: Account Manager for MLC-HCF Medical
Properties Trust, Inc. transaction
Facsimile: 1-866-264-3051
E-Mail: MLC_HCF_RE1@ml.com
With copies to:
Merrill Lynch Capital
222 N. LaSalle Street, 16th Floor
Chicago, Illinois 60601
Attn: Group Senior Transaction Attorney,
Healthcare Finance
Facsimile Number: (312) 499-3245
Merrill Lynch Capital
7700 Wisconsin Ave., Suite 400
Bethesda, Maryland 20814
Attn: Group Senior Transaction Attorney,
Healthcare Finance
Facsimile Number: (866) 341-9053
[MERRILL LYNCH LOGO]
ANNEX A TO CREDIT AGREEMENT (COMMITMENT ANNEX)
REVOLVING LOAN
LENDER REVOLVING LOAN COMMITMENT AMOUNT COMMITMENT PERCENTAGE
- --------------------- -------------------------------- -----------------------
Merrill Lynch Capital $100,000,000 100%
