Revolving Loan Agreement - Avalon Bay Communities Inc., Fleet National Bank, Morgan Guaranty Trust Co. of New York, and Union Bank of Switzerland
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REVOLVING LOAN AGREEMENT
dated as of June 23, 1998
among
AVALON BAY COMMUNITIES, INC.,
as Borrower,
FLEET NATIONAL BANK,
as Co-Agent and Bank,
MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
as Co-Agent and Bank,
UNION BANK OF SWITZERLAND
(New York Branch),
as Co-Agent and Bank,
the other banks signatory hereto,
each as a Bank,
and
FLEET NATIONAL BANK,
as Administrative Agent
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TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS; ETC.....................................................................................1
Section 1.01 Definitions.................................................................................1
Section 1.02 Accounting Terms...........................................................................17
Section 1.03 Computation of Time Periods................................................................17
Section 1.04 Rules of Construction......................................................................17
ARTICLE II THE LOANS..........................................................................................18
Section 2.01 Ratable Loans; Bid Rate Loans; Purpose.....................................................18
Section 2.02 Bid Rate Loans.............................................................................19
Section 2.03 Advances, Generally........................................................................22
Section 2.04 Procedures for Advances....................................................................22
Section 2.05 Interest Periods; Renewals.................................................................23
Section 2.06 Interest...................................................................................23
Section 2.07 Fees.......................................................................................24
Section 2.08 Notes......................................................................................24
Section 2.09 Prepayments................................................................................25
Section 2.10 Cancellation of Commitments................................................................25
Section 2.11 Method of Payment..........................................................................26
Section 2.12 Elections, Conversions or Continuation of Loans............................................26
Section 2.13 Minimum Amounts............................................................................26
Section 2.14 Certain Notices Regarding Elections, Conversions and Continuations of Loans................26
Section 2.15 Late Payment Premium.......................................................................27
Section 2.16 Letters of Credit..........................................................................27
Section 2.17 Intentionally Omitted......................................................................29
Section 2.18 Swing Loans................................................................................29
Section 2.19 Extension Of Maturity......................................................................30
ARTICLE III YIELD PROTECTION; ILLEGALITY, ETC.................................................................31
Section 3.01 Additional Costs...........................................................................31
Section 3.02 Limitation on Types of Loans...............................................................32
Section 3.03 Illegality.................................................................................33
Section 3.04 Treatment of Affected Loans................................................................33
Section 3.05 Certain Compensation.......................................................................33
Section 3.06 Capital Adequacy...........................................................................34
Section 3.07 Substitution of Banks......................................................................34
Section 3.08 Applicability..............................................................................36
ARTICLE IV CONDITIONS PRECEDENT...............................................................................36
Section 4.01 Conditions Precedent to the Initial Advance................................................36
Section 4.02 Conditions Precedent to Advances After the Initial Advance.................................37
Section 4.03 Deemed Representations.....................................................................38
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ARTICLE V REPRESENTATIONS AND WARRANTIES......................................................................38
Section 5.01 Due Organization...........................................................................38
Section 5.02 Power and Authority; No Conflicts; Compliance With Laws....................................38
Section 5.03 Legally Enforceable Agreements.............................................................39
Section 5.04 Litigation.................................................................................39
Section 5.05 Good Title to Properties...................................................................39
Section 5.06 Taxes......................................................................................39
Section 5.07 ERISA......................................................................................39
Section 5.08 No Default on Outstanding Judgments or Orders..............................................40
Section 5.09 No Defaults on Other Agreements............................................................40
Section 5.10 Government Regulation......................................................................40
Section 5.11 Environmental Protection...................................................................40
Section 5.12 Solvency...................................................................................40
Section 5.13 Financial Statements.......................................................................40
Section 5.14 Valid Existence of Affiliates..............................................................40
Section 5.15 Insurance..................................................................................41
Section 5.16 Accuracy of Information; Full Disclosure...................................................41
Section 5.17 Corporate Merger and Termination of Other Credit Facilities................................41
ARTICLE VI AFFIRMATIVE COVENANTS..............................................................................41
Section 6.01 Maintenance of Existence...................................................................41
Section 6.02 Maintenance of Records.....................................................................42
Section 6.03 Maintenance of Insurance...................................................................42
Section 6.04 Compliance with Laws; Payment of Taxes.....................................................42
Section 6.05 Right of Inspection........................................................................42
Section 6.06 Compliance With Environmental Laws.........................................................42
Section 6.07 Maintenance of Properties..................................................................42
Section 6.08 Payment of Costs...........................................................................42
Section 6.09 Reporting and Miscellaneous Document Requirements..........................................42
Section 6.10 Principal Prepayments as a Result of Reduction in Total Loan Commitment....................44
ARTICLE VII NEGATIVE COVENANTS................................................................................45
Section 7.01 Mergers Etc................................................................................45
Section 7.02 Investments................................................................................45
Section 7.03 Sale of Assets.............................................................................45
ARTICLE VIII FINANCIAL COVENANTS..............................................................................45
Section 8.01 Consolidated Tangible Net Worth............................................................45
Section 8.02 Relationship of Total Outstanding Indebtedness to Capitalization Value.....................45
Section 8.03 Relationship of Combined EBITDA to Interest Expense........................................45
Section 8.04 Relationship of Combined EBITDA to Combined Debt Service...................................46
Section 8.05 Relationship of Combined EBITDA to Total Outstanding Indebtedness..........................46
Section 8.06 Unsecured Debt Yield.......................................................................46
Section 8.07 Relationship of Unencumbered Combined EBITDA to Unsecured Interest Expense.................46
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Section 8.08 Relationship of Dividends to Funds From Operations.........................................46
Section 8.09 Relationship of Secured Indebtedness to Capitalization Value...............................46
ARTICLE IX EVENTS OF DEFAULT..................................................................................46
Section 9.01 Events of Default..........................................................................46
Section 9.02 Remedies...................................................................................48
ARTICLE X ADMINISTRATIVE AGENT; RELATIONS AMONG BANKS.........................................................49
Section 10.01 Appointment, Powers and Immunities of Administrative Agent.................................49
Section 10.02 Reliance by Administrative Agent...........................................................49
Section 10.03 Defaults...................................................................................50
Section 10.04 Rights of Administrative Agent as a Bank...................................................50
Section 10.05 Indemnification of Administrative Agent....................................................50
Section 10.06 Non-Reliance on Administrative Agent and Other Banks.......................................51
Section 10.07 Failure of Administrative Agent to Act.....................................................51
Section 10.08 Resignation or Removal of Administrative Agent.............................................51
Section 10.09 Amendments Concerning Agency Function......................................................52
Section 10.10 Liability of Administrative Agent..........................................................52
Section 10.11 Transfer of Agency Function................................................................52
Section 10.12 Non-Receipt of Funds by Administrative Agent...............................................52
Section 10.13 Withholding Taxes..........................................................................53
Section 10.14 Minimum Commitment by Co-Agents............................................................53
Section 10.15 Pro Rata Treatment.........................................................................53
Section 10.16 Sharing of Payments Among Banks............................................................53
Section 10.17 Possession of Documents....................................................................54
ARTICLE XI NATURE OF OBLIGATIONS..............................................................................54
Section 11.01 Absolute and Unconditional Obligations.....................................................54
Section 11.02 Non-Recourse to Borrower's Principals......................................................54
ARTICLE XII MISCELLANEOUS.....................................................................................55
Section 12.01 Binding Effect of Request for Advance......................................................55
Section 12.02 Amendments and Waivers.....................................................................55
Section 12.03 Usury......................................................................................56
Section 12.04 Expenses; Indemnification..................................................................56
Section 12.05 Assignment; Participation..................................................................57
Section 12.06 Documentation Satisfactory.................................................................58
Section 12.07 Notices....................................................................................58
Section 12.08 Setoff.....................................................................................58
Section 12.09 Table of Contents; Headings................................................................59
Section 12.10 Severability...............................................................................59
Section 12.11 Counterparts...............................................................................59
Section 12.12 Integration................................................................................59
Section 12.13 Governing Law..............................................................................59
Section 12.14 Waivers....................................................................................59
Section 12.15 Jurisdiction; Immunities...................................................................59
Section 12.16 Designated Lender..........................................................................60
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Section 12.17 No Bankruptcy Proceedings..................................................................61
Section 12.18 Year 2000..................................................................................61
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EXHIBIT A - Authorization Letter
EXHIBIT B - Ratable Loan Note
EXHIBIT B-1 - Bid Rate Loan Note
EXHIBIT B-2 - Swing Loan Note
EXHIBIT C - Information Regarding Material Affiliates
EXHIBIT D - Solvency Certificate
EXHIBIT E - Assignment and Assumption Agreement
EXHIBIT F - Designation Agreement
EXHIBIT G-1 - Bid Rate Quote Request
EXHIBIT G-2 - Invitation for Bid Rate Quotes
EXHIBIT G-3 - Bid Rate Quote
EXHIBIT G-4 - Borrower's Acceptance of Bid Rate Quote
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REVOLVING LOAN AGREEMENT dated as of June 23, 1998 among AVALON BAY
COMMUNITIES, INC., a corporation organized and existing under the laws of the
State of Maryland ("Borrower"), FLEET NATIONAL BANK (in its individual capacity
and not as Administrative Agent, "Fleet"), MORGAN GUARANTY TRUST COMPANY OF NEW
YORK ("Morgan"), UNION BANK OF SWITZERLAND (New York Branch) ("UBS"), the other
lenders signatory hereto, and FLEET NATIONAL BANK, as administrative agent for
the Banks (in such capacity, together with its successors in such capacity,
"Administrative Agent"; Fleet, Morgan, UBS, the other lenders signatory hereto,
such other lenders who from time to time become Banks pursuant to Section 3.07
or 12.05 and, if applicable, any of the foregoing lenders' Designated Lender,
each a "Bank" and collectively, the "Banks").
Borrower desires that the Banks extend credit as provided herein, and
the Banks are prepared to extend such credit. Accordingly, in consideration of
the premises and the mutual agreements, covenants and conditions hereinafter set
forth, Borrower, Administrative Agent and each of the Banks agree as follows:
ARTICLE I
DEFINITIONS; ETC.
Section 1.01 Definitions. As used in this Agreement the following
terms have the following meanings (except as otherwise provided, terms defined
in the singular to have a correlative meaning when used in the plural and vice
versa):
"Absolute Bid Rate" has the meaning specified in Section 2.02(c)(2).
"Absolute Bid Rate Loan" means a Bid Rate Loan bearing interest at
the Absolute Bid Rate.
"Absolute Rate Auction" means a solicitation of Bid Rate Quotes
setting forth Absolute Bid Rates pursuant to Section 2.02.
"Acquisition" means the acquisition by Borrower, directly or
indirectly, of an interest in multi-family real estate.
"Additional Costs" has the meaning specified in Section 3.01.
"Administrative Agent" has the meaning specified in the preamble.
"Administrative Agent's Office" means Administrative Agent's address
located at One Landmark Square, Stamford, Connecticut 06904, or such other
address in the United States as Administrative Agent may designate by written
notice to Borrower and the Banks.
"Affiliate" means, with respect to any Person (the "first Person"),
any other Person (1) which directly or indirectly controls, or is controlled by,
or is under common control with the first Person; or (2) 10% or more of the
beneficial interest in which is directly or indirectly owned or held by the
first Person. The term "control" means the possession, directly
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or indirectly, of the power, alone, to direct or cause the direction of the
management and policies of a Person, whether through the ownership of voting
securities, by contract, or otherwise.
"Agreement" means this Revolving Loan Agreement.
"Applicable Lending Office" means, for each Bank and for its LIBOR
Loan, Bid Rate Loan(s) or Base Rate Loan, as applicable, the lending office of
such Bank (or of an Affiliate of such Bank) designated as such on its signature
page hereof or in the applicable Assignment and Assumption Agreement, or such
other office of such Bank (or of an Affiliate of such Bank) as such Bank may
from time to time specify to Administrative Agent and Borrower as the office by
which its LIBOR Loan, Bid Rate Loan(s) or Base Rate Loan (and, in the case of
the Swing Lender, its Swing Loan), as applicable, is to be made and maintained.
"Applicable Margin" means, with respect to Base Rate Loans and LIBOR
Loans (and for purposes of determining the Banks' L/C Fee Rate under Section
2.16(f)), the respective rates per annum determined at any time, based on the
range into which Borrower's Credit Rating then falls, in accordance with the
following table (any change in Borrower's Credit Rating causing it to move to a
different range on the table shall effect an immediate change in the Applicable
Margin):
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Range of Borrower's Applicable Margin Applicable Margin
Credit Rating for Base Rate Loans for LIBOR Loans
(S&P/Moody's) (% per annum) (% per annum)
------------- ------------- -------------
<S> <C> <C>
Below BBB-/below Baa3 or unrated 0.25 1.15
BBB-/Baa3 0.00 0.95
BBB/Baa2 0.00 0.75
BBB+/Baa1 0.00 0.60
A-or higher/A3 or higher 0.00 0.55
</TABLE>
"Assignee" and "Consented Assignee" have the respective meanings
specified in Section 12.05.
"Assignment and Assumption Agreement" means an Assignment and
Assumption Agreement, substantially in the form of EXHIBIT E, pursuant to which
a Bank assigns and an Assignee assumes rights and obligations in accordance with
Section 12.05.
"Authorization Letter" means a letter agreement executed by Borrower
in the form of EXHIBIT A.
"Available Total Loan Commitment" has the meaning specified in
Section 2.01(b).
"Avalon" means Avalon Properties, Inc., a Maryland corporation.
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"Bank" and "Banks" have the respective meanings specified in the
preamble; provided, however, that the term "Bank" shall exclude each Designated
Lender when used in reference to a Ratable Loan, the Loan Commitments or terms
relating to the Ratable Loans and the Loan Commitments.
"Bank Parties" means Administrative Agent and the Banks.
"Banking Day" means (1) any day on which commercial banks are not
authorized or required to close in New York City and (2) whenever such day
relates to a LIBOR Loan, a LIBOR Bid Rate Loan, an Interest Period with respect
to a LIBOR Loan or a LIBOR Bid Rate Loan, or notice with respect to a LIBOR Loan
or a LIBOR Bid Rate Loan or a LIBOR Auction, a day on which dealings in Dollar
deposits are also carried out in the London interbank market and banks are open
for business in London.
"Base Rate" means, for any day, the higher of (1) the Federal Funds
Rate for such day plus .50%, or (2) the Prime Rate for such day.
"Base Rate Loan" means all or any portion (as the context requires)
of a Bank's Ratable Loan which shall accrue interest at a rate determined in
relation to the Base Rate.
"Bay" means Bay Apartment Communities, Inc., a Maryland corporation.
"Bid Borrowing Limit" means 66 2/3% of the Total Loan Commitment.
"Bid Rate Loan" has the meaning specified in Section 2.01(c).
"Bid Rate Loan Note" has the meaning specified in Section 2.08.
"Bid Rate Quote" means an offer by a Bank to make a Bid Rate Loan in
accordance with Section 2.02.
"Bid Rate Quote Request" has the meaning specified in Section
2.02(a).
"Borrower" has the meaning specified in the preamble.
"Borrower's Accountants" means Coopers & Lybrand, or such other
accounting firm(s) selected by Borrower and reasonably acceptable to the
Required Banks.
"Borrower's Credit Rating" means the rating assigned from time to
time to Borrower's unsecured and unsubordinated long-term indebtedness by,
respectively, S&P and/or Moody's. In connection with the foregoing, it is
understood that if more than one (1) of the rating agencies identified above
assigns a rating to Borrower's unsecured and unsubordinated long-term
indebtedness, the following shall apply: (i) "Borrower's Credit Rating" shall be
the lower of said ratings and (ii) if the aforesaid ratings are greater than one
(1) rating level apart, "Borrower's Credit Rating" shall be the average of said
ratings. Unless such indebtedness of Borrower is rated by at least one (1) of
the rating agencies identified above, "Borrower's Credit Rating" shall be
considered unrated for purposes of this Agreement.
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"Borrower's Principals" means the officers and directors of Borrower
at any applicable time.
"Borrower's Share of UJV Combined Outstanding Indebtedness" means the
sum of the indebtedness of each of the UJVs contributing to UJV Combined
Outstanding Indebtedness multiplied by Borrower's respective beneficial
fractional interests in each such UJV.
"Capitalization Value" means, as of the end of any calendar quarter,
the sum of (1) Combined EBITDA (less all leasing commissions and management and
development fees, net of any expenses applicable thereto, contributing to
Combined EBITDA) for such quarter annualized (i.e., multiplied by four (4)),
capitalized at a rate of 8.75% per annum (i.e., divided by 8.75%), and (2) such
leasing commissions and management and development fees for such quarter,
annualized, (i.e., multiplied by four (4)), capitalized at a rate of 25% per
annum (i.e., divided by 25%), (3) Cash and Cash Equivalents of Borrower and its
Consolidated Businesses, as of the end of such quarter, as reflected in
Borrower's Consolidated Financial Statements, and (4) the lesser of (a) the
aggregate book value (on a cost basis) of the properties of Borrower and its
Consolidated Businesses under development plus Borrower's beneficial interest in
the book value (on a cost basis) of the properties of the UJVs under development
or (b) 20% of the sum of the amounts determined pursuant to clauses (1), (2) and
(3) of this definition.
"Capital Lease" means any lease which has been or should be
capitalized on the books of the lessee in accordance with GAAP.
"Cash and Cash Equivalents" means (1) cash, (2) direct obligations of
the United States Government, including, without limitation, treasury bills,
notes and bonds, (3) interest-bearing or discounted obligations of federal
agencies and government-sponsored entities or pools of such instruments offered
by Approved Banks and dealers, including, without limitation, Federal Home Loan
Mortgage Corporation participation sale certificates, Government National
Mortgage Association modified pass through certificates, Federal National
Mortgage Association bonds and notes, and Federal Farm Credit System securities,
(4) time deposits, domestic and eurodollar certificates of deposit, bankers'
acceptances, commercial paper rated at least A-1 by S&P and P-1 by Moody's
and/or guaranteed by an Aa rating by Moody's, an AA rating by S&P or better
rated credit, floating rate notes, other money market instruments and letters of
credit each issued by Approved Banks, (5) obligations of domestic corporations,
including, without limitation, commercial paper, bonds, debentures and loan
participations, each of which is rated at least AA by S&P and/or Aa2 by Moody's
and/or guaranteed by an Aa rating by Moody's, an AA rating by S&P or better
rated credit, (6) obligations issued by states and local governments or their
agencies, rated at least MIG-1 by Moody's and /or SP-1 by S&P and /or guaranteed
by an irrevocable letter of credit of an Approved Bank, (7) repurchase
agreements with major banks and primary government security dealers fully
secured by the United States Government or agency collateral equal to or
exceeding the principal amount on a daily basis and held in safekeeping and (8)
real estate loan pool participations, guaranteed by an AA rating given by S&P or
an Aa2 rating given by Moody's or better rated credit. For purposes of this
definition, "Approved Bank" means a financial institution which has (x) (A) a
minimum net worth of $500,000,000 and/or (B) total assets of at least
$10,000,000,000 and (y) a minimum long-term debt rating of A+ by S&P or A1 by
Moody's.
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"Closing Date" means the date this Agreement has been executed by all
parties.
"Co-Agent" means each of Fleet, Morgan and UBS and "Co-Agents" means
Fleet, Morgan and UBS collectively.
"Code" means the Internal Revenue Code of 1986.
"Combined Debt Service" means, for any period of time, (1) Borrower's
share of total debt service (including principal) paid or payable by Borrower
and its Consolidated Businesses during such period (other than debt service on
construction loans until completion of the relevant construction and other
capitalized interest) plus a deemed annual capital expense charge of $150 per
apartment unit owned by Borrower or its Consolidated Businesses plus (2)
Borrower's beneficial interest in (a) total debt service (including principal)
paid or payable by the UJVs during such period (other than debt service on
construction loans until completion of the relevant construction and other
capitalized interest) plus (b) a deemed annual capital expense charge of $150
per apartment unit owned by the UJVs plus (3) preferred dividends paid or
payable by Borrower and its Consolidated Businesses during such period.
"Combined EBITDA" means, for any period of time, the sum, without
duplication, of (1) Borrower's share of revenues less operating expenses,
general and administrative expenses and property taxes before Interest Expense,
income taxes, gains or losses on the sale of real estate and/or marketable
securities, depreciation and amortization and extraordinary items for Borrower
and its Consolidated Businesses, and adjusted, if material, for non-cash revenue
attributable to straight lining of rents and (2) Borrower's beneficial interest
in revenues less operating expenses, general and administrative expenses and
property taxes before Interest Expense, income taxes, gains or losses on the
sale of real estate and/or marketable securities, depreciation and amortization
and extraordinary items (after eliminating appropriate intercompany amounts)
applicable to each of the UJVs, and adjusted, if material, for non-cash revenue
attributable to straight lining of rents, in all cases as reflected in
Borrower's Consolidated Financial Statements.
"Consolidated Businesses" means, collectively, each Affiliate of
Borrower who is or should be included in Borrower's Consolidated Financial
Statements in accordance with GAAP.
"Consolidated Financial Statements" means, with respect to any
Person, the consolidated balance sheet and related consolidated statement of
operations, accumulated deficiency in assets and cash flows, and footnotes
thereto, of such Person, prepared in accordance with GAAP.
"Consolidated Outstanding Indebtedness" means, as of any time,
Borrower's share of all indebtedness and liability for borrowed money, secured
or unsecured, of Borrower and its Consolidated Businesses, including mortgage
and other notes payable but excluding any indebtedness which is margin
indebtedness on cash and cash equivalent securities, all as reflected in
Borrower's Consolidated Financial Statements.
"Consolidated Tangible Net Worth" means, at any date, Borrower's
share of the consolidated stockholders' equity of Borrower and its Consolidated
Businesses less their
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consolidated Intangible Assets, all determined as of such date. For purposes of
this definition, "Intangible Assets" means with respect to any such intangible
assets, the amount (to the extent reflected in determining such consolidated
stockholders' equity) of (1) all write-ups (other than write-ups resulting from
foreign currency translations and write-ups of assets of a going concern
business made within twelve (12) months after the acquisition of such business)
subsequent to September 30, 1994 in the book value of any asset (other than real
property assets) owned by Borrower or a Consolidated Business and (2) all debt
discount and expense, deferred charges, goodwill, patents, trademarks, service
marks, trade names, anticipated future benefit of tax loss carry-forwards,
copyrights, organization or developmental expenses and other intangible assets
(in each case, not adjusted for depreciation).
"Contingent Obligations" means, without duplication, Borrower's share
of (1) any contingent obligations of Borrower or its Constituted Businesses
required to be shown on the balance sheet of Borrower and its Consolidated
Businesses in accordance with GAAP and (2) any obligation required to be
disclosed in the footnotes to Borrower's Consolidated Financial Statements,
guaranteeing partially or in whole any non-Recourse Debt, lease, dividend or
other obligation, exclusive of contractual indemnities (including, without
limitation, any indemnity or price-adjustment provision relating to the purchase
or sale of securities or other assets) and guarantees of non-monetary
obligations (other than guarantees of completion) which have not yet been called
on or quantified, of Borrower or any of its Consolidated Businesses or of any
other Person. The amount of any Contingent Obligation described in clause (2)
shall be deemed to be (a) with respect to a guaranty of interest or interest and
principal, or operating income guaranty, the net present value (using the Base
Rate as a discount rate) of the sum of all payments required to be made
thereunder (which in the case of an operating income guaranty shall be deemed to
be equal to the debt service for the note secured thereby), through (i) in the
case of an interest or interest and principal guaranty, the stated date of
maturity of the obligation (and commencing on the date interest could first be
payable thereunder) or (ii) in the case of an operating income guaranty, the
date through which such guaranty will remain in effect and (b) with respect to
all guarantees not covered by the preceding clause (a), an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
guaranty is made or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming Borrower and/or one or more
of its Consolidated Businesses is required to perform thereunder) as recorded on
the balance sheet and on the footnotes to the most recent Borrower's
Consolidated Financial Statements required to be delivered pursuant to this
Agreement. Notwithstanding anything contained herein to the contrary, guarantees
of completion shall not be deemed to be Contingent Obligations unless and until
a claim for payment or performance has been made thereunder, at which time any
such guaranty of completion shall be deemed to be a Contingent Obligation in an
amount equal to any such claim. Subject to the preceding sentence, (1) in the
case of a joint and several guaranty given by Borrower or one of its
Consolidated Businesses and another Person (but only to the extent such guaranty
is recourse, directly or indirectly to Borrower), the amount of the guaranty
shall be deemed to be 100% thereof unless and only to the extent that such other
Person has delivered Cash and Cash Equivalents to secure all or any part of such
Person's guaranteed obligations and (2) in the case of joint and several
guarantees given by a Person in which Borrower owns an interest (which
guarantees are non-recourse to Borrower), to the extent the guarantees, in the
aggregate, exceed 10% of Capitalization Value, the amount in excess of 10% shall
be deemed to be a Contingent Obligation of Borrower. Notwithstanding anything
contained herein to the
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contrary, "Contingent Obligations" shall be deemed not to include guarantees of
unadvanced funds under any indebtedness of Borrower or its Consolidated
Businesses or of construction loans to the extent the same have not been drawn.
All matters constituting "Contingent Obligations" shall be calculated without
duplication.
"Continue", "Continuation" and "Continued" refer to the continuation
pursuant to Section 2.12 of a LIBOR Loan as a LIBOR Loan from one Interest
Period to the next Interest Period.
"Convert", "Conversion" and "Converted" refer to a conversion
pursuant to Section 2.12 of a Base Rate Loan into a LIBOR Loan or a LIBOR Loan
into a Base Rate Loan, each of which may be accompanied by the transfer by a
Bank (at its sole discretion) of all or a portion of its Ratable Loan from one
Applicable Lending Office to another.
"Debt" means (1) indebtedness or liability for borrowed money, or for
the deferred purchase price of property or services (including trade
obligations); (2) obligations as lessee under Capital Leases; (3) current
liabilities in respect of unfunded vested benefits under any Plan; (4)
obligations under letters of credit issued for the account of any Person; (5)
all obligations arising under bankers' or trade acceptance facilities; (6) all
guarantees, endorsements (other than for collection or deposit in the ordinary
course of business), and other contingent obligations to purchase any of the
items included in this definition, to provide funds for payment, to supply funds
to invest in any Person, or otherwise to assure a creditor against loss; (7) all
obligations secured by any Lien on property owned by the Person whose Debt is
being measured, whether or not the obligations have been assumed; and (8) all
obligations under any agreement providing for contingent participation or other
hedging mechanisms with respect to interest payable on any of the items
described above in this definition.
"Default" means any event which with the giving of notice or lapse of
time, or both, would become an Event of Default.
"Default Rate" means a rate per annum equal to: (1) with respect to
Base Rate Loans and Swing Loans, a variable rate 3% above the rate of interest
then in effect thereon; and (2) with respect to LIBOR Loans and Bid Rate Loans,
a fixed rate 3% above the rate(s) of interest in effect thereon (including the
Applicable Margin or the LIBOR Bid Margin, as the case may be) at the time of
Default until the end of the then current Interest Period therefor and,
thereafter, a variable rate 3% above the rate of interest for a Base Rate Loan.
"Designated Lender" means a special purpose corporation that (i)
shall have become a party to this Agreement pursuant to Section 12.16 and (ii)
is not otherwise a Bank.
"Designating Lender" has the meaning specified in Section 12.16.
"Designation Agreement" means an agreement in substantially the form
of EXHIBIT F, entered into by a Bank and a Designated Lender and accepted by
Administrative Agent.
"Disposition" means a sale (whether by assignment, transfer or
Capital Lease) of an asset.
7
<PAGE> 13
"Documentation Agent" means Union Bank of Switzerland (New York
Branch).
"Dollars" and the sign "$" mean lawful money of the United States of
America.
"Elect", "Election" and "Elected" refer to election, if any, by
Borrower pursuant to Section 2.12 to have all or a portion of an advance of the
Ratable Loans be outstanding as LIBOR Loans.
"Environmental Discharge" means any discharge or release of any
Hazardous Materials in violation of any applicable Environmental Law.
"Environmental Law" means any applicable Law relating to pollution or
the environment, including Laws relating to noise or to emissions, discharges,
releases or threatened releases of Hazardous Materials into the work place, the
community or the environment, or otherwise relating to the generation,
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials.
"Environmental Notice" means any written complaint, order, citation
or notice from any Person (1) affecting or relating to Borrower's compliance
with any Environmental Law in connection with any activity or operations at any
time conducted by Borrower, (2) relating to (a) the existence of any Hazardous
Materials contamination or Environmental Discharges or threatened Hazardous
Materials contamination or Environmental Discharges at any of Borrower's
locations or facilities or (b) remediation of any Environmental Discharge or
Hazardous Materials at any such location or facility or any part thereof; or (3)
any violation or alleged violation by Borrower of any relevant Environmental
Law.
"ERISA" means the Employee Retirement Income Security Act of 1974,
including the rules and regulations promulgated thereunder.
"ERISA Affiliate" means any corporation which is a member of the same
controlled group of corporations (within the meaning of Section 414(b) of the
Code) as Borrower, or any trade or business which is under common control
(within the meaning of Section 414(c) of the Code) with Borrower, or any
organization which is required to be treated as a single employer with Borrower
under Section 414(m) or 414(o) of the Code.
"Event of Default" has the meaning specified in Section 9.01.
"Extension Option", "Notice to Extend" and "Request to Extend" have
the respective meanings specified in Section 2.19.
8
<PAGE> 14
"Facility Fee Rate" means the rate per annum determined, at any time,
based on Borrower's Credit Rating in accordance with the following table. Any
change in Borrower's Credit Rating which causes it to move into a different
range on the table shall effect an immediate change in the Facility Fee Rate.
<TABLE>
<CAPTION>
Borrower's Credit Rating Facility Fee Rate
(S&P/Moody's) (% per annum)
------------- -------------
<S> <C>
Below BBB-/Baa3 or unrated 0.25
BBB-/Baa3 0.20
BBB/Baa2 0.150
BBB+/Baa1 0.150
A-/A3 or higher 0.150
</TABLE>
"Federal Funds Rate" means, for any day, the rate per annum
(expressed on a 360-day basis of calculation) equal to the weighted average of
the rates on overnight federal funds transactions as published by the Federal
Reserve Bank of New York for such day provided that (1) if such day is not a
Banking Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the immediately preceding Banking Day as so published on the
next succeeding Banking Day; and (2) if no such rate is so published on such
next succeeding Banking Day, the Federal Funds Rate for such day shall be the
average of the rates quoted by three (3) Federal Funds brokers to Administrative
Agent on such day on such transactions.
"Fiscal Year" means each period from January 1 to December 31.
"Fleet" has the meaning specified in the preamble.
"Funds From Operations" means Combined EBITDA less the sum of
Interest Expense and income taxes included in Combined EBITDA.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect from time to time, applied on a basis consistent
with those used in the preparation of the financial statements referred to in
Section 5.13 (except for changes concurred in by Borrower's Accountants).
"Good Faith Contest" means the contest of an item if: (1) the item is
diligently contested in good faith, and, if appropriate, by proceedings timely
instituted; (2) reserves that are adequate based on reasonably foreseeable
likely outcomes are established with respect to the contested item; (3) during
the period of such contest, the enforcement of any contested item is effectively
stayed, delayed or postponed; and (4) the failure to pay or comply with the
contested item during the period of the contest is not likely to result in a
Material Adverse Change.
"Governmental Approvals" means any authorization, consent, approval,
license, permit, certification, or exemption of, registration or filing with or
report or notice to, any Governmental Authority.
9
<PAGE> 15
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Hazardous Materials" means any pollutant, effluents, emissions,
contaminants, toxic or hazardous wastes or substances, as any of those terms are
defined from time to time in or for the purposes of any relevant Environmental
Law, including asbestos fibers and friable asbestos, polychlorinated biphenyls,
and any petroleum or hydrocarbon-based products or derivatives.
"Initial Advance" means the first advance of proceeds of the Loans.
"Interest Expense" means, for any period of time, Borrower's share of
the consolidated interest expense (without deduction of consolidated interest
income, and excluding (x) interest expense on construction loans and (y) other
capitalized interest expense in respect of either construction activity or
construction loans, in any such case under clauses (x) or (y), only until
completion of the relevant construction) of Borrower and its Consolidated
Businesses, including, without limitation or duplication (or, to the extent not
so included, with the addition of), (1) the portion of any rental obligation in
respect of any Capital Lease obligation allocable to interest expense in
accordance with GAAP; (2) the amortization of Debt discounts; (3) any payments
or fees (other than up-front fees) with respect to interest rate swap or similar
agreements; and (4) the interest expense and items listed in clauses (1) through
(3) above applicable to each of the UJVs multiplied by Borrower's respective
beneficial interests in the UJVs, in all cases as reflected in Borrower's
Consolidated Financial Statements.
"Interest Period" means, (1) with respect to any LIBOR Loan, the
period commencing on the date the same is advanced, converted from a Base Rate
Loan or Continued, as the case may be, and ending, as Borrower may select
pursuant to Section 2.05, on the numerically corresponding day in the first,
second or third calendar month thereafter, provided that each such Interest
Period which commences on the last Banking Day of a calendar month (or on any
day for which there is no numerically corresponding day in the appropriate
subsequent calendar month) shall end on the last Banking Day of the appropriate
calendar month; (2) with respect to any LIBOR Bid Rate Loan, the period
commencing on the date the same is advanced and ending, as Borrower may select
pursuant to Section 2.02, on the numerically corresponding day in the first,
second or third calendar month thereafter, provided that each such Interest
Period which commences on the last Banking Day of a calendar month (or on any
day for which there is no numerically corresponding day in the appropriate
subsequent calendar month) shall end on the last Banking Day of the appropriate
calendar month; and (3) with respect to any Absolute Bid Rate Loan, the period
commencing on the date the same is advanced and ending, as Borrower may select
pursuant to Section 2.02, provided, however, that each such period shall not be
less than fourteen (14) days nor more than ninety (90) days.
"Invitation for Bid Rate Quotes" has the meaning specified in Section
2.02 (b).
"Law" means any federal, state or local statute, law, rule,
regulation, ordinance, order, code, or rule of common law, now or hereafter in
effect, and in each case as amended, and any judicial or administrative order,
consent decree or judgment.
10
<PAGE> 16
"Letter of Credit" has the meaning specified in Section 2.16(a).
"LIBOR Auction" means a solicitation of Bid Rate Quotes setting forth
LIBOR Bid Margins pursuant to Section 2.02.
"LIBOR Base Rate" means, with respect to any Interest Period
therefor, the rate per annum (rounded up, if necessary, to the nearest 1/100 of
1%) that appears on Dow Jones Page 3750 at approximately 11:00 a.m. (London
time) on the date (the "LIBOR Determination Date") two (2) Banking Days prior to
the first day of the applicable Interest Period, for the same period of time as
the Interest Period; or, if such rate does not appear on Dow Jones Page 3750 as
of approximately 11:00 a.m. (London time) on the LIBOR Determination Date, the
rate (rounded up, if necessary, to the nearest 1/100 of 1%) for deposits in
Dollars for a period comparable to the applicable Interest Period that appears
on the Reuters Screen LIBOR Page as of approximately 11:00 a.m. (London time) on
the LIBOR Determination Date. If such rate does not appear on either Dow Jones
Page 3750 or on the Reuters Screen LIBOR Page as of approximately 11:00 a.m.
(London time) on the LIBOR Determination Date, the LIBOR Base Rate for the
Interest Period will be determined on the basis of the offered rates for
deposits in Dollars for the same period of time as such Interest Period that are
offered by four (4) major banks in the London interbank market at approximately
11:00 a.m. (London time) on the LIBOR Determination Date. Administrative Agent
will request that the principal London office of each of the four (4) major
banks provide a quotation of its Dollar deposit offered rate. If at least two
(2) such quotations are provided, the LIBOR Base Rate will be the arithmetic
mean of the quotations. If fewer than two (2) quotations are provided as
requested, the LIBOR Base Rate will be determined on the basis of the rates
quoted for loans in Dollars to leading European banks for amounts comparable to
such amount requested by Borrower for the same period of time as such Interest
Period offered by major banks in New York City at approximately 11:00 a.m. (New
York time) on the LIBOR Determination Date. In the event that Administrative
Agent is unable to obtain any such quotation as provided above, it will be
deemed that the LIBOR Base Rate cannot be determined. For purposes of the
foregoing definition, "Dow Jones Page 3750" means the display designated as
"Page 3750" on the Dow Jones Markets Service (or such other page as may replace
Page 3750 on that service or such other service as may be nominated by the
British Bankers' Association as the information vendor for the purpose of
displaying British Bankers' Association Interest Settlement Rates for Dollar
deposits); and "Reuters Screen LIBOR Page" means the display designated as page
"LIBOR" on the Reuters Monitor Money Rates Service (or such other page as may
replace the LIBOR page on that service for the purpose of displaying interbank
rates from London in Dollars).
"LIBOR Bid Margin" has the meaning specified in Section 2.02(c)(2).
"LIBOR Bid Rate" means the rate per annum equal to the sum of (1) the
LIBOR Interest Rate for the LIBOR Bid Rate Loan and Interest Period in question
and (2) the LIBOR Bid Margin.
"LIBOR Bid Rate Loan" means a Bid Rate Loan bearing interest at the
LIBOR Bid Rate.
11
<PAGE> 17
"LIBOR Interest Rate" means, for any LIBOR Loan or LIBOR Bid Rate
Loan, a rate per annum (rounded upwards, if necessary, to the nearest 1/100 of
1%) determined by Administrative Agent to be equal to the quotient of (1) the
LIBOR Base Rate for such LIBOR Loan or LIBOR Bid Rate Loan, as the case may be,
for the Interest Period therefor divided by (2) one minus the LIBOR Reserve
Requirement for such LIBOR Loan or LIBOR Bid Rate Loan, as the case may be, for
such Interest Period.
"LIBOR Loan" means all or any portion (as the context requires) of
any Bank's Ratable Loan which shall accrue interest at rate(s) determined in
relation to LIBOR Interest Rate(s).
"LIBOR Reserve Requirement" means, for any LIBOR Loan or LIBOR Bid
Rate Loan, the average maximum rate at which reserves (including any marginal,
supplemental or emergency reserves) are required to be maintained during the
Interest Period for such LIBOR Loan or LIBOR Bid Rate Loan under Regulation D by
member banks of the Federal Reserve System in New York City with deposits
exceeding $1,000,000,000 against "Eurocurrency liabilities" (as such term is
used in Regulation D). Without limiting the effect of the foregoing, the LIBOR
Reserve Requirement shall also reflect any other reserves required to be
maintained by such member banks by reason of any Regulatory Change against (1)
any category of liabilities which includes deposits by reference to which the
LIBOR Base Rate is to be determined as provided in the definition of "LIBOR Base
Rate" in this Section 1.01 or (2) any category of extensions of credit or other
assets which include loans the interest rate on which is determined on the basis
of rates referred to in said definition of "LIBOR Base Rate".
"Lien" means any mortgage, deed of trust, pledge, negative pledge,
security interest, hypothecation, assignment for collateral purposes, deposit
arrangement, lien (statutory or other), or other security agreement or charge of
any kind or nature whatsoever of any third party (excluding any right of setoff
but including, without limitation, any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing, and the filing of any financing statement under the
Uniform Commercial Code or comparable Law of any jurisdiction to evidence any of
the foregoing and carriers, warehousemen, mechanics and other similar inchoate
liens that have been insured against in a manner reasonably satisfactory to the
Required Banks).
"Loan" means, with respect to each Bank, collectively, its Ratable
Loan and Bid Rate Loan(s), and, in the case of the Swing Lender, its Swing
Loan(s).
"Loan Commitment" means, with respect to each Bank, the obligation to
make a Ratable Loan in the principal amount set forth below (subject to change
as a result of assignments by one or more of the Banks pursuant to the third
paragraph of Section 12.05) as such amount may be reduced from time to time in
accordance with the provisions of Section 2.10:
<TABLE>
<CAPTION>
Loan
Bank Commitment
---- ----------
<S> <C>
Morgan $120,000,000
</TABLE>
12
<PAGE> 18
<TABLE>
<S> <C>
Fleet 65,000,000
UBS 65,000,000
Commerzbank AG 50,000,000
Dresdner Bank AG 50,000,000
First Union National Bank 50,000,000
NationsBank, N.A. 50,000,000
PNC Bank, National Association 50,000,000
AMSOUTH Bank 30,000,000
The Long Term Credit Bank of Japan 25,000,000
Summit Bank 25,000,000
The Sumitomo Bank, Limited 20,000,000
TOTAL: $600,000,000
============
</TABLE>
"Loan Documents" means this Agreement, the Notes, the Authorization
Letter and the Solvency Certificate.
"Majority Banks" means at any time the Banks having Pro Rata Shares
aggregating at least 51%; provided, however, that during the existence of an
Event of Default, the "Majority Banks" shall be the Banks holding at least 51%
of the then aggregate unpaid principal amount of the Loans. For purposes of this
definition, a Bank's Loan shall be deemed to include its participating interest
in Swing Loans pursuant to Section 2.18(c) and the Swing Lender's Loans shall be
deemed to exclude such participating interests of other Banks.
"Material Adverse Change" means an effect resulting from any
circumstance or event or series of circumstances or events, of whatever nature,
which does or could reasonably be expected to, on more than an interim basis,
either (1) materially and adversely impair the ability of Borrower and its
Consolidated Businesses, taken as a whole, to fulfill its material obligations
or (2) cause a Default.
"Material Affiliates" means the Affiliates of Borrower described on
EXHIBIT C, together with (or excluding) any Affiliates of Borrower which are
hereafter from time to time reasonably determined by Administrative Agent to be
material (or no longer material), upon written notice to Borrower, based on the
most recent Borrower's Consolidated Financial Statements.
"Maturity Date" means July 1, 2001, subject to extension in
accordance with Section 2.19.
"Moody's" means Moody's Investors Service, Inc.
"Morgan" has the meaning specified in the preamble.
13
<PAGE> 19
"Multiemployer Plan" means a Plan defined as such in Section 3(37) of
ERISA to which contributions have been made by Borrower or any ERISA Affiliate
and which is covered by Title IV of ERISA.
"Note" and "Notes" have the respective meanings specified in Section
2.08.
"Obligations" means each and every obligation, covenant and agreement
of Borrower, now or hereafter existing, contained in this Agreement, and any of
the other Loan Documents, whether for principal, reimbursement obligations,
interest, fees, expenses, indemnities or otherwise, and any amendments or
supplements thereto, extensions or renewals thereof or replacements therefor,
including but not limited to all indebtedness, obligations and liabilities of
Borrower to Administrative Agent and any Bank now existing or hereafter incurred
under or arising out of or in connection with the Notes, this Agreement, the
other Loan Documents, and any documents or instruments executed in connection
therewith; in each case whether direct or indirect, joint or several, absolute
or contingent, liquidated or unliquidated, now or hereafter existing, renewed or
restructured, whether or not from time to time decreased or extinguished and
later increased, created or incurred, and including all indebtedness of
Borrower, under any instrument now or hereafter evidencing or securing any of
the foregoing.
"Parent" means, with respect to any Bank, any Person controlling such
Bank.
"Participant" and "Participations" have the respective meanings
specified in Section 12.05.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.
"Plan" means any employee benefit or other plan established or
maintained, or to which contributions have been made, by Borrower or any ERISA
Affiliate and which is covered by Title IV of ERISA or to which Section 412 of
the Code applies.
"Presence", when used in connection with any Environmental Discharge
or Hazardous Materials, means and includes presence, generation, manufacture,
installation, treatment, use, storage, handling, repair, encapsulation,
disposal, transportation, spill, discharge and release.
"Prime Rate" means the variable per annum rate of interest designated
from time to time by Fleet National Bank at its principal office in Boston,
Massachusetts as its "prime Rate" (it being understood that the "prime rate" is
a reference rate and does not necessarily represent the lowest or best rate
being charged to any customer).
"Pro Rata Share" means, for purposes of this Agreement and with
respect to each Bank, a fraction, the numerator of which is the amount of such
Bank's Loan Commitment and the denominator of which is the Total Loan
Commitment.
14
<PAGE> 20
"Prohibited Transaction" means any transaction proscribed by Section
406 of ERISA or Section 4975 of the Code and to which no statutory or
administrative exemption applies.
"Ratable Loan" has the meaning specified in Section 2.01(b).
"Ratable Loan Note" has the meaning specified in Section 2.08.
"Recourse Debt" means Debt, recourse for the satisfaction of which is
not limited to specified collateral.
"Refunded Swing Loans" and "Refunding Date" have the respective
meanings specified in Section 2.18.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System, as the same may be amended or supplemented from time to
time, or any similar Law from time to time in effect.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System, as the same may be amended or supplemented from time to
time.
"Regulatory Change" means, with respect to any Bank, any change after
the date of this Agreement in United States federal, state, municipal or foreign
laws or regulations (including Regulation D) or the adoption or making after
such date of any interpretations, directives or requests applying to a class of
banks including such Bank of or under any United States, federal, state,
municipal or foreign laws or regulations (whether or not having the force of
law) by any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"Reportable Event" means any of the events set forth in Section
4043(c) of ERISA, other than those events as to which the thirty (30) day notice
period is waived under subsections .13, .14, .16, .18, .19 or .20 of PBGC Reg.
Section 2615.
"Required Banks" means at any time the Banks having Pro Rata Shares
aggregating at least 66 2/3%; provided, however, that during the existence of an
Event of Default, the "Required Banks" shall be the Banks holding at least 66
2/3% of the then aggregate unpaid principal amount of the Loans. For purposes of
this definition, a Bank's Loan shall be deemed to include its participating
interest in Swing Loans pursuant to Section 2.18(c) and the Swing Lender's Loans
shall be deemed to exclude such participating interests of other Banks.
"Secured Indebtedness" means that portion of Total Outstanding
Indebtedness that is secured.
"Solvency Certificate" means a certificate in the form of EXHIBIT D,
to be delivered by Borrower pursuant to the terms of this Agreement.
15
<PAGE> 21
"Solvent" means, when used with respect to any Person, that the fair
value of the property of such Person, on a going concern basis, is greater than
the total amount of liabilities (including, without limitation, contingent
liabilities) of such Person.
"S&P" means Standard and Poor's Ratings Services, a division of
McGraw-Hill Companies.
"Supplemental Fee Letter" means, collectively, those certain letter
agreements, each dated on or prior to the date hereof, between Borrower and each
of Morgan, Fleet and UBS.
"Swing Lender" means Fleet in its capacity as the lender under the
Swing Loan facility described in Section 2.18, and its successors in such
capacity.
"Swing Loan" means a loan made by the Swing Lender pursuant to
Section 2.18.
"Swing Loan Commitment" means $20,000,000.
"Swing Loan Note" has the meaning specified in Section 2.08.
"Swing Loan Refund Amount" has the meaning specified in Section 2.18.
"Syndication Agent" means JP Morgan Securities, Inc.
"Total Loan Commitment" means an amount equal to the aggregate amount
of all Loan Commitments (i.e., $600,000,000).
"Total Outstanding Indebtedness" means the sum, without duplication,
of (1) Consolidated Outstanding Indebtedness; (2) Borrower's Share of UJV
Combined Outstanding Indebtedness; and (3) Contingent Obligations.
"UBS" has the meaning specified in the preamble.
"UJV Combined Outstanding Indebtedness" means, as of any time, all
indebtedness and liability for borrowed money, secured or unsecured, of the
UJV's, on a combined basis, including mortgage and other notes payable but
excluding any indebtedness which is margin indebtedness on cash and cash
equivalent securities, all as reflected in the balance sheets of each of the
UJVs, prepared in accordance with GAAP.
"UJVs" means the unconsolidated joint ventures (including general and
limited partnerships) in which Borrower owns a beneficial interest and which are
accounted for under the equity method in Borrower's Consolidated Financial
Statements.
"Unencumbered Combined EBITDA" means that portion of Combined EBITDA
attributable to Unencumbered Wholly-Owned Assets (assuming corporate overhead is
allocated proportionately to Unencumbered Wholly-Owned Assets).
"Unencumbered Wholly-Owned Assets" means income-producing assets,
reflected on Borrower's Consolidated Financial Statements, wholly owned,
directly or indirectly,
16
<PAGE> 22
by Borrower which (1) are not, and the direct or indirect interests of Borrower
therein are not, subject to any Lien to secure all or any portion of Secured
Indebtedness or any other encumbrances which, in the reasonable judgment of
Co-Agents, may diminish the value of the asset in question and (2) complies with
the occupancy requirements set forth in the immediately following sentence. In
order to qualify as an Unencumbered Wholly-Owned Asset for a particular calendar
quarter an asset must (1) have average occupancy for the twelve (12)-month
period ending with such quarter of 85% or more and (2) have average quarterly
occupancy for at least three (3) of the four (4) calendar quarters during such
twelve (12)-month period of 85% or more.
"Unsecured Debt Yield" means, for any calendar quarter, the ratio of
(1) Unencumbered Combined EBITDA for such quarter to (2) Unsecured Indebtedness
as of the end of such calendar quarter.
"Unsecured Indebtedness" means that portion of Total Outstanding
Indebtedness that is unsecured.
"Unsecured Interest Expense" means that portion of Interest Expense
relating to Unsecured Indebtedness.
Section 1.02 Accounting Terms. All accounting terms not
specifically defined herein shall be construed in accordance with GAAP, and all
financial data required to be delivered hereunder shall be prepared in
accordance with GAAP.
Section 1.03 Computation of Time Periods. Except as otherwise
provided herein, in this Agreement, in the computation of periods of time from a
specified date to a later specified date, the word "from" means "from and
including" and words "to" and "until" each means "to but excluding".
Section 1.04 Rules of Construction. Except as provided otherwise,
when used in this Agreement (1) "or" is not exclusive; (2) a reference to a Law
includes any amendment or modification to such Law; (3) a reference to a Person
includes its permitted successors and permitted assigns; (4) all references to
the singular shall include the plural and vice versa; (5) a reference to an
agreement, instrument or document shall include such agreement, instrument or
document as the same may be amended, modified or supplemented from time to time
in accordance with its terms and as permitted by the Loan Documents; (6) all
references to Articles, Sections or Exhibits shall be to Articles, Sections and
Exhibits of this Agreement unless otherwise indicated; (7) "hereunder",
"herein", "hereof" and the like refer to this Agreement as a whole; and (8) all
Exhibits to this Agreement shall be incorporated into this Agreement.
17
<PAGE> 23
ARTICLE II
THE LOANS
Section 2.01 Ratable Loans; Bid Rate Loans; Purpose. (a) Subject to
the terms and conditions of this Agreement, the Banks agree to make loans to
Borrower as provided in this Article II.
(b) Each of the Banks severally agrees to make a loan to Borrower
(each such loan by a Bank, a "Ratable Loan") in an amount up to its Loan
Commitment pursuant to which the Bank shall from time to time advance and
re-advance to Borrower an amount equal to its Pro Rata Share of the excess (the
"Available Total Loan Commitment") of the Total Loan Commitment over the sum of
(1) all previous advances (including Bid Rate Loans and Swing Loans) made by the
Banks which remain unpaid and (2) the outstanding amount of all Letters of
Credit. Within the limits set forth herein, Borrower may borrow from time to
time under this paragraph (b) and prepay from time to time pursuant to Section
2.09 (subject, however, to the restrictions on prepayment set forth in said
Section), and thereafter re-borrow pursuant to this paragraph (b). The Ratable
Loans may be outstanding as (1) Base Rate Loans; (2) LIBOR Loans; or (3) a
combination of the foregoing, as Borrower shall elect and notify Administrative
Agent in accordance with Section 2.14. The LIBOR Loan, Bid Rate Loan and Base
Rate Loan of each Bank shall be maintained at such Bank's Applicable Lending
Office.
(c) In addition to Ratable Loans pursuant to paragraph (b) above, so
long as Borrower's Credit Rating is BBB- or better by S&P or Baa(3) or better by
Moody's, one or more Banks may, at Borrower's request and in their sole
discretion, make non-ratable loans which shall bear interest at the LIBOR Bid
Rate in accordance with Section 2.02 (such loans being referred to in this
Agreement as "Bid Rate Loans"). Borrower may borrow Bid Rate Loans from time to
time pursuant to this paragraph (c) in an amount up to the Available Total Loan
Commitment at the time of the borrowing (taking into account any repayments of
the Loans made simultaneously therewith) and shall repay such Bid Rate Loans as
required by Section 2.08, and it may thereafter re-borrow pursuant to this
paragraph (c); provided, however, that the aggregate outstanding principal
amount of Bid Rate Loans at any particular time shall not exceed the Bid
Borrowing Limit.
(d) The obligations of the Banks under this Agreement are several,
and no Bank shall be responsible for the failure of any other Bank to make any
advance of a Loan to be made by such other Bank. However, the failure of any
Bank to make any advance of the Loan to be made by it hereunder on the date
specified therefor shall not relieve any other Bank of its obligation to make
any advance of its Loan specified hereby to be made on such date.
(e) Borrower shall use the proceeds of the Loans for general capital
and working capital requirements of Borrower and its Consolidated Businesses and
UJVs (which shall include, but not be limited to, Acquisitions and/or costs
incurred in connection with the development, construction or reconstruction of
multi-family real estate properties). In no event shall proceeds of the Loans be
used in a manner that would violate Regulation U or in connection with a hostile
acquisition.
18
<PAGE> 24
Section 2.02 Bid Rate Loans. (a) When Borrower wishes to request
offers from the Banks to make Bid Rate Loans, it shall transmit to
Administrative Agent by facsimile a request (a "Bid Rate Quote Request")
substantially in the form of EXHIBIT G-1 so as to be received not later than
12:00 Noon (New York time) on (x) the fifth Banking Day prior to the date for
funding of the LIBOR Bid Rate Loan(s) proposed therein in the case of a LIBOR
Auction or (y) the second Banking Day prior to the date for funding of the
Absolute Bid Rate Loan(s) proposed therein in the case of an Absolute Rate
Auction, specifying:
(1) the proposed date of funding of the Bid Rate Loan(s), which shall
be a Banking Day;
(2) the aggregate amount of the Bid Rate Loans requested, which shall
be $20,000,000 or a larger integral multiple of $500,000;
(3) the duration of the Interest Period(s) applicable thereto,
subject to the provisions of the definition of "Interest Period" in Section
1.01 and the provisions of Section 2.05; and
(4) whether the Bid Rate Quotes requested are to set forth a LIBOR
Bid Margin (to be used to compute the LIBOR Bid Rate) or an Absolute Bid
Rate.
Borrower may request offers to make Bid Rate Loans for more than one (1)
Interest Period in a single Bid Rate Quote Request. No more than two (2) Bid
Rate Quote Requests may be submitted by Borrower during any calendar month and
no more than twenty-four (24) Bid Rate Quote Requests per year may be submitted
by Borrower.
(b) Promptly (the same day, if possible) upon receipt of a Bid Rate
Quote Request, Administrative Agent shall send to the Banks by facsimile an
invitation (an "Invitation for Bid Rate Quotes") substantially in the form of
EXHIBIT G-2, which shall constitute an invitation by Borrower to the Banks to
submit Bid Rate Quotes offering to make Bid Rate Loans to which such Bid Rate
Quote Request relates in accordance with this Section.
(c) (1) Each Bank may submit a Bid Rate Quote containing an
offer or offers to make Bid Rate Loans in response to any Invitation for Bid
Rate Quotes. Each Bid Rate Quote must comply with the requirements of this
paragraph (c) and must be submitted to Administrative Agent by facsimile not
later than (x) 2:00 p.m. (New York time) on the fourth Banking Day prior to the
proposed date of the LIBOR Bid Rate Loan(s) in the case of a LIBOR Auction or
(y) 9:30 a.m. (New York time) on the Banking Day immediately preceding the
proposed date of the Absolute Bid Rate Loan(s) in the case of an Absolute Rate
Auction; provided that Bid Rate Quotes submitted by Administrative Agent (or any
Affiliate of Administrative Agent) in its capacity as a Bank may be submitted,
and may only be submitted, if Administrative Agent or such Affiliate notifies
Borrower of the terms of the offer or offers contained therein not later than
(x) one (1) hour prior to the deadline for the other Banks in the case of a
LIBOR Auction or (y) thirty (30) minutes prior to the deadline for the other
Banks in the case of an Absolute Rate Auction. Any Bid Rate Quote so made shall
(subject to Borrower's satisfaction of the conditions precedent set forth in
this Agreement to its entitlement to an advance) be irrevocable except with the
written consent of Administrative Agent given on the
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<PAGE> 25
instructions of Borrower. Bid Rate Loans to be funded pursuant to a Bid Rate
Quote may, as provided in Section 12.16, be funded by a Bank's Designated
Lender. A Bank making a Bid Rate Quote shall, if then known, specify in its Bid
Rate Quote whether the related Bid Rate Loans are intended to be funded by such
Bank's Designated Lender, as provided in Section 12.16, provided, however, that
whether or not the same is specified in a Bank's Bid Rate Quote, such Bank's Bid
Rate Loan(s) may be funded by its Designated Lender at the time of funding
thereof.
(2) Each Bid Rate Quote shall be in substantially the form of
EXHIBIT G-3 and shall in any case specify:
(i) the proposed date of funding of the Bid Rate Loan(s);
(ii) the principal amount of the Bid Rate Loan(s) for which each
such offer is being made, which principal amount (w) may be greater than or
less than the Loan Commitment of the quoting Bank, (x) must be in the
aggregate $20,000,000 or a larger integral multiple of $500,000, (y) may
not exceed the principal amount of Bid Rate Loans for which offers were
requested and (z) may be subject to an aggregate limitation as to the
principal amount of Bid Rate Loans for which offers being made by such
quoting Bank may be accepted;
(iii) in the case of a LIBOR Auction, the margin above or below
the applicable LIBOR Interest Rate (the "LIBOR Bid Margin") offered for
each such LIBOR Bid Rate Loan, expressed as a percentage per annum
(specified to the nearest 1/1,000th of 1%) to be added to (or subtracted
from) the applicable LIBOR Interest Rate;
(iv) in the case of an Absolute Rate Auction, the rate of
interest, expressed as a percentage per annum (specified to the nearest
1/1,000th of 1%) (the "Absolute Bid Rate"), offered for each such Absolute
Bid Rate Loan;
(v) the applicable Interest Period; and
(vi) the identity of the quoting Bank.
A Bid Rate Quote may set forth up to three (3) separate offers by the quoting
Bank with respect to each Interest Period specified in the related Invitation
for Bid Rate Quotes.
(3) Any Bid Rate Quote shall be disregarded if it:
(i) is not substantially in conformity with EXHIBIT G-3 or does
not specify all of the information required by sub-paragraph (c)(2) above;
(ii) contains qualifying, conditional or similar language
(except for an aggregate limitation as provided in sub-paragraph (c)(2)(ii)
above);
(iii) proposes terms other than or in addition to those set forth
in the applicable Invitation for Bid Rate Quotes; or
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<PAGE> 26
(iv) arrives after the time set forth in sub-paragraph (c)(1)
above.
(d) Administrative Agent shall (x) not later than 3:00 p.m. (New York
time) on the fourth Banking Day prior to the proposed date of funding of the
LIBOR Bid Rate Loan(s) in the case of a LIBOR Auction or (y) not later than
10:30 a.m. (New York time) on the Banking Day immediately preceding the proposed
date of funding of the Absolute Bid Rate Loan(s) in the case of an Absolute Rate
Auction, notify Borrower in writing of the terms of any Bid Rate Quote submitted
by a Bank that is in accordance with paragraph (c). In addition, Administrative
Agent shall, on the Banking Day of its receipt thereof, notify Borrower in
writing of any Bid Rate Quote that amends, modifies or is otherwise inconsistent
with a previous Bid Rate Quote submitted by such Bank with respect to the same
Bid Rate Quote Request. Any such subsequent Bid Rate Quote shall be disregarded
by Administrative Agent unless such subsequent Bid Rate Quote is submitted
solely to correct a manifest error in such former Bid Rate Quote. Administrative
Agent's notice to Borrower shall specify (A) the aggregate principal amount of
Bid Rate Loans for which offers have been received for each Interest Period
specified in the related Bid Rate Quote Request, (B) the respective principal
amounts, LIBOR Bid Margins and Absolute Bid Rates so offered and (C) if
applicable, limitations on the aggregate principal amount of Bid Rate Loans for
which offers in any single Bid Rate Quote may be accepted.
(e) Not later than (x) 9:30 a.m. (New York time) on the third Banking
Day prior to the proposed date of funding of the LIBOR Bid Rate Loan in the case
of a LIBOR Auction or (y) the Banking Day immediately preceding the proposed
date of funding of the Absolute Bid Rate Loan in the case of an Absolute Rate
Auction, Borrower shall notify Administrative Agent of its acceptance or
non-acceptance of the offers so notified to it pursuant to paragraph (d). A
notice of acceptance shall be substantially in the form of EXHIBIT G-4 and shall
specify the aggregate principal amount of offers for each Interest Period that
are accepted. Borrower may accept any Bid Rate Quote in whole or in part;
provided that:
(i) the principal amount of each Bid Rate Loan may not exceed
the applicable amount set forth in the related Bid Rate Quote Request or be
less than $500,000 per Bank and shall be an integral multiple of $100,000;
(ii) acceptance of offers with respect to a particular Interest
Period may only be made on the basis of ascending LIBOR Bid Margins or
Absolute Bid Rates, as the case may be, offered for such Interest Period
from the lowest effective cost; and
(iii) Borrower may not accept any offer that is described in
sub-paragraph (c)(3) or that otherwise fails to comply with the
requirements of this Agreement.
(f) If offers are made by two (2) or more Banks with the same LIBOR
Bid Margins or Absolute Bid Rates, as the case may be, for a greater aggregate
principal amount than the amount in respect of which such offers are accepted
for the related Interest Period, the principal amount of Bid Rate Loans in
respect of which such offers are accepted shall be allocated by Administrative
Agent among such Banks as nearly as possible (in multiples of $100,000, as
Administrative Agent may deem appropriate) in proportion to the aggregate
principal amounts of such offers. Administrative Agent shall promptly (and in
any event within one (1) Banking Day after such offers are accepted) notify
Borrower and each such Bank in
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<PAGE> 27
writing of any such allocation of Bid Rate Loans. Determinations by
Administrative Agent of the allocation of Bid Rate Loans shall be conclusive in
the absence of manifest error.
(g) In the event that Borrower accepts the offer(s) contained in one
(1) or more Bid Rate Quotes in accordance with paragraph (e), the Bank(s) making
such offer(s) shall make a Bid Rate Loan in the accepted amount (as allocated,
if necessary, pursuant to paragraph (f)) on the date specified therefor, in
accordance with the procedures specified in Section 2.04, and such Bid Rate Loan
shall bear interest at the accepted LIBOR Bid Rate or Absolute Bid Rate, as the
case may be, for the applicable Interest Period.
(h) Notwithstanding anything to the contrary contained herein, each
Bank shall be required to fund its Pro Rata Share of the Available Total Loan
Commitment in accordance with Section 2.01(b) despite the fact that any Bank's
Loan Commitment may have been or may be exceeded as a result of such Bank's
making Bid Rate Loans.
(i) A Bank who is notified that it has been selected to make a Bid
Rate Loan as provided above may designate its Designated Lender (if any) to fund
such Bid Rate Loan on its behalf, as described in Section 12.16. Any Designated
Lender which funds a Bid Rate Loan shall on and after the time of such funding
become the obligee under such Bid Rate Loan and be entitled to receive payment
thereof when due. No Bank shall be relieved of its obligation to fund a Bid Rate
Loan, and no Designated Lender shall assume such obligation, prior to the time
the applicable Bid Rate Loan is funded.
(j) Administrative Agent shall promptly notify each Bank which
submitted a Bid Rate Quote of Borrower's acceptance or non-acceptance thereof.
At the request of any Bank which submitted a Bid Rate Quote, Administrative
Agent will promptly notify all Banks which submitted Bid Rate Quotes of (a) the
aggregate principal amount of, and (b) the range of Absolute Bid Rates or LIBOR
Bid Margins of, the accepted Bid Rate Loans for each requested Interest Period.
Section 2.03 Advances, Generally. The Initial Advance shall be in
the minimum amount of $500,000 and in integral multiples of $100,000 above such
amount and shall be made upon satisfaction of the conditions set forth in
Section 4.01. Subsequent advances shall be made no more frequently than weekly
thereafter, upon satisfaction of the conditions set forth in Section 4.02. The
amount of each advance subsequent to the Initial Advance shall be in the minimum
amount of $500,000 (unless less than $500,000 is available for disbursement
pursuant to the terms hereof at the time of any subsequent advance, in which
case the amount of such subsequent advance shall be equal to such remaining
availability) and in integral multiples of $100,000 above such amount.
Additional restrictions on the amounts and timing of, and conditions to the
making of, advances of Bid Rate Loans are set forth in Section 2.02.
Section 2.04 Procedures for Advances. In the case of advances of
Ratable Loans hereunder, Borrower shall submit to Administrative Agent a request
for each advance, stating the amount requested and certifying the purpose, in
general terms, for which such advance is to be used, no later than 11:00 a.m.
(New York time) on the date, in the case of advances of Base Rate Loans, which
is one (1) Banking Day, and, in the case of advances of LIBOR Loans, which is
three (3) Banking Days, prior to the date the advance is to be made. In
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<PAGE> 28
the case of advances of Swing Loans hereunder, Borrower shall submit to
Administrative Agent a request for such advance, stating the amount requested
and certifying the purpose, in general terms, for which such advance is to be
used, no later than 11:00 a.m. (New York time) on the date which is one (1)
Banking Day prior to the date the advance is to be made. In the case of advances
of Bid Rate Loans hereunder, Borrower shall submit a Bid Rate Quote Request at
the time specified in Section 2.02, accompanied by a certification of the
purpose, in general terms, for which the advance is to be used. Administrative
Agent, on the Banking Day of its receipt and approval of the request for
advance, will so notify the Banks (or, in the case of Swing Loans, the Swing
Lender) either by telephone or by facsimile. Not later than 11:00 a.m. (New York
time) on the date of each advance, each Bank (in the case of Ratable Loans) or
the applicable Bank(s) (in the case of Bid Rate Loans) or the Swing Lender (in
the case of Swing Loans) shall, through its Applicable Lending Office and
subject to the conditions of this Agreement, make the amount to be advanced by
it on such day available to Administrative Agent, at Administrative Agent's
Office and in immediately available funds for the account of Borrower. The
amount so received by Administrative Agent shall, subject to the conditions of
this Agreement, be made available to Borrower, in immediately available funds,
by Administrative Agent's crediting an account of Borrower designated by
Borrower and maintained with Administrative Agent at Administrative Agent's
Office.
Section 2.05 Interest Periods; Renewals. In the case of the LIBOR
Loans and Bid Rate Loans, Borrower shall select an Interest Period of any
duration in accordance with the definition of Interest Period in Section 1.01,
subject to the following limitations: (1) no Interest Period may extend beyond
the Maturity Date; and (2) if an Interest Period would end on a day which is not
a Banking Day, such Interest Period shall be extended to the next Banking Day,
unless such Banking Day would fall in the next calendar month, in which event
such Interest Period shall end on the immediately preceding Banking Day. Only
twelve (12) discrete segments of a Bank's Ratable Loan bearing interest at a
LIBOR Interest Rate, for a designated Interest Period, pursuant to a particular
Election, Conversion or Continuation, may be outstanding at any one time (each
such segment of each Bank's Ratable Loan corresponding to a proportionate
segment of each of the other Banks' Ratable Loans).
Upon notice to Administrative Agent as provided in Section 2.14,
Borrower may Continue any LIBOR Loan on the last day of the Interest Period of
the same or different duration in accordance with the limitations provided
above. If Borrower shall fail to give notice to Administrative Agent of such a
Continuation, such LIBOR Loan shall automatically become a LIBOR Loan with an
Interest Period of one (1) month on the last day of the current Interest Period.
Administrative Agent shall notify each of the Banks, either by telephone or by
facsimile, at least two (2) Banking Days prior to the termination of the
Interest Period in question in the event of such failure by Borrower to give
such notice of Continuation.
Section 2.06 Interest. Borrower shall pay interest to
Administrative Agent for the account of the applicable Bank on the outstanding
and unpaid principal amount of the Loans, at a rate per annum as follows: (1)
for Base Rate Loans at a rate equal to the Base Rate plus the Applicable Margin;
(2) for LIBOR Loans at a rate equal to the applicable LIBOR Interest Rate plus
the Applicable Margin; (3) for LIBOR Bid Rate Loans at a rate equal to the
applicable LIBOR Bid Rate; (4) for Absolute Bid Rate Loans at a rate equal to
the applicable Absolute Bid Rate; and (5) for Swing Loans at a three (3)-day
LIBOR rate, as determined by the Swing
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<PAGE> 29
Lender. Any principal amount not paid when due (when scheduled, at acceleration
or otherwise) shall bear interest thereafter, payable on demand, at the Default
Rate.
The interest rate on Base Rate Loans shall change when the Base Rate
changes. Interest on Base Rate Loans, LIBOR Loans, Bid Rate Loans and Swing
Loans shall not exceed the maximum amount permitted under applicable law.
Interest shall be calculated for the actual number of days elapsed on the basis
of, in the case of Base Rate Loans, LIBOR Loans, Bid Rate Loans and Swing Loans,
three hundred sixty (360) days.
Accrued interest shall be due and payable in arrears upon and with
respect to any payment or prepayment of principal and, (x) in the case of Base
Rate Loans, LIBOR Loans and Swing Loans, on the first Banking Day of each
calendar month and (y) in the case of Bid Rate Loans, at the expiration of the
Interest Period applicable thereto; provided, however, that interest accruing at
the Default Rate shall be due and payable on demand.
Section 2.07 Fees. (a) Borrower agrees to pay to and for the
accounts of the parties specified therein, the fees provided for in the
Supplemental Fee Letter.
(b) Borrower shall pay to Administrative Agent for the account of
each Bank a facility fee computed on the daily Loan Commitment of such Bank
(irrespective of usage) at a rate per annum equal to the daily Facility Fee
Rate, calculated on the basis of a year of three hundred sixty (360) days for
the actual number of days elapsed. The accrued facility fee shall be due and
payable quarterly in arrears on the tenth (10th) day of October, January, April
and July of each year, commencing on the first such date after the Closing Date,
and upon the Maturity Date (as stated or by acceleration or otherwise) or
earlier termination of the Loan Commitments.
Section 2.08 Notes. The Ratable Loan made by each Bank under this
Agreement shall be evidenced by, and repaid with interest in accordance with, a
single promissory note of Borrower in the form of EXHIBIT B duly completed and
executed by Borrower, in the principal amount equal to such Bank's Loan
Commitment, payable to such Bank for the account of its Applicable Lending
Office (each such note, as the same may hereafter be amended, modified,
extended, severed, assigned, renewed or restated from time to time, including
any substitute notes pursuant to Section 3.07 or 12.05, a "Ratable Loan Note").
The Bid Rate Loans of the Banks shall be evidenced by a single global promissory
note of Borrower, in the form of EXHIBIT B-1, duly completed and executed by
Borrower, in the principal amount of $400,000,000, payable to Administrative
Agent for the account of the respective Banks making Bid Rate Loans (such note,
as the same may hereafter be amended, modified, extended, severed, assigned,
substituted, renewed or restated from time to time, the "Bid Rate Loan Note").
The Swing Loan of the Swing Lender shall be evidenced by, and repaid with
interest in accordance with, a promissory note of Borrower, in the form of
EXHIBIT B-2, duly completed and executed by Borrower, payable to the Swing
Lender (such note, as the same may hereafter be amended, modified extended,
severed, assigned, substituted, renewed or restated from time to time, the
"Swing Loan Note"). A particular Bank's Ratable Loan Note, together with its
interest, if any, in the Bid Rate Loan Note, and, in the case of the Swing
Lender, the Swing Loan Note, are referred to collectively in this Agreement as
such Bank's "Note"; all such Ratable Loan Notes and interests and Swing Loan
Notes are referred to collectively in this Agreement as the "Notes". The Ratable
Loan Notes shall mature, and all outstanding principal
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<PAGE> 30
and accrued interest and other sums thereunder shall be paid in full, on the
Maturity Date, as the same may be accelerated. The outstanding principal amount
of each Bid Rate Loan evidenced by the Bid Rate Loan Note, and all accrued
interest and other sums with respect thereto, shall become due and payable to
the Bank making such Bid Rate Loan at the earlier of the expiration of the
Interest Period applicable thereto or the Maturity Date, as the same may be
accelerated. Principal amounts evidenced by the Swing Loan Notes shall become
due and payable three (3) Banking Days after said amounts are advanced.
Each Bank is hereby authorized by Borrower to endorse on the schedule
attached to the Ratable Loan Note held by it, the amount of each advance and
each payment of principal received by such Bank for the account of its
Applicable Lending Office(s) on account of its Ratable Loan, which endorsement
shall, in the absence of manifest error, be conclusive as to the outstanding
balance of the Ratable Loan made by such Bank. The Swing Lender is hereby
authorized by Borrower to endorse on the schedule attached to the Swing Loan
Note held by it, the amount of each advance and each payment of principal
received by the Swing Lender for the account of its Applicable Lending Office(s)
on account of its Swing Loan, which endorsement shall, in the absence of
manifest error, be conclusive as to the outstanding balance of the Swing Loan
made by the Swing Lender. Administrative Agent is hereby authorized by Borrower
to endorse on the schedule attached to the Bid Rate Loan Note the amount of each
LIBOR Bid Rate Loan and/or Absolute Bid Rate Loan, the name of the Bank making
the same, the date of the advance thereof, the interest rate applicable thereto
and the expiration of the Interest Period applicable thereto (i.e., the maturity
date thereof). The failure by Administrative Agent or any Bank to make such
notations with respect to the Loans or each advance or payment shall not limit
or otherwise affect the obligations of Borrower under this Agreement or the
Notes.
In case of any loss, theft, destruction or mutilation of any Bank's
Note, Borrower shall, upon its receipt of an affidavit of an officer of such
Bank as to such loss, theft, destruction or mutilation and an appropriate
indemnification, execute and deliver a replacement Note to such Bank in the same
principal amount and otherwise of like tenor as the lost, stolen, destroyed or
mutilated Note.
Section 2.09 Prepayments. Without prepayment premium or penalty but
subject to Section 3.05, Borrower may, upon at least one (1) Banking Day's
notice to Administrative Agent in the case of the Base Rate Loans and Swing
Loans, and at least three (3) Banking Days' notice to Administrative Agent in
the case of LIBOR Loans, prepay the Ratable Loans, provided that (1) any partial
prepayment under this Section shall be in integral multiples of $500,000; (2) a
LIBOR Loan or Swing Loan may be prepaid at any time, subject, however, to the
provisions of Section 3.05; and (3) each prepayment under this Section shall
include all interest accrued on the amount of principal prepaid through the date
of prepayment. Prepayment of Bid Rate Loans shall not be permitted.
Section 2.10 Cancellation of Commitments. (a) At any time, Borrower
shall have the right, without premium or penalty, to terminate any unused Loan
Commitments or unused commitment of the Swing Lender to make Swing Loans, in
whole or in part, from time to time, provided that: (1) Borrower shall give
notice of each such termination to Administrative Agent and the Swing Lender, if
applicable, no later then 10:00 a.m. (New York time) on the date which is
fifteen (15) Banking Days prior to the effectiveness of such termination; (2)
the Loan Commitments of each of the Banks, or Swing Lender, as applicable, must
be terminated ratably and simultaneously with those of the other Banks, or Swing
Lender, as applicable; and (3) each partial termination of the Loan Commitments,
or commitments to make Swing Loans, as a whole (and corresponding reduction of
the Total Loan Commitment) shall be in an integral multiple of $1,000,000.
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(b) The Loan Commitments, to the extent terminated, may not be
reinstated.
Section 2.11 Method of Payment. Borrower shall make each payment
under this Agreement and under the Notes not later than 11:00 a.m. (New York
time) on the date when due in Dollars to Administrative Agent at Administrative
Agent's Office in immediately available funds. Administrative Agent will
thereafter, on the day of its receipt of each such payment, cause to be
distributed to each Bank (1) such Bank's appropriate share (based upon the
respective outstanding principal amounts and rate(s) of interest under the Notes
of the Banks) of the payments of principal and interest in like funds for the
account of such Bank's Applicable Lending Office; and (2) fees payable to such
Bank in accordance with the terms of this Agreement. In the event Administrative
Agent fails to pay funds received from Borrower to the Banks on the date on
which Borrower is credited with payment, Administrative Agent shall pay interest
on such amounts at the Federal Funds Rate until such payment to the Banks is
made. Borrower hereby authorizes Administrative Agent and the Banks, if and to
the extent payment by Borrower is not made when due under this Agreement or
under the Notes, to charge from time to time against any account Borrower
maintains with Administrative Agent or any Bank any amount so due to
Administrative Agent and/or the Banks.
Except to the extent provided in this Agreement, whenever any payment
to be made under this Agreement or under the Notes is due on any day other than
a Banking Day, such payment shall be made on the next succeeding Banking Day,
and such extension of time shall in such case be included in the computation of
the payment of interest and other fees, as the case may be.
Section 2.12 Elections, Conversions or Continuation of Loans.
Subject to the provisions of Article III and Sections 2.05 and 2.13, Borrower
shall have the right to Elect to have all or a portion of any advance of the
Ratable Loans be LIBOR Loans, to Convert Base Rate Loans into LIBOR Loans, to
Convert LIBOR Loans into Base Rate Loans, or to Continue LIBOR Loans as LIBOR
Loans, at any time or from time to time, provided that (1) Borrower shall give
Administrative Agent notice of each such Election, Conversion or Continuation as
provided in Section 2.14; and (2) a LIBOR Loan may be Converted or Continued
only on the last day of the applicable Interest Period for such LIBOR Loan.
Except as otherwise provided in this Agreement, each Election, Continuation and
Conversion shall be applicable to each Bank's Ratable Loan in accordance with
its Pro Rata Share.
Section 2.13 Minimum Amounts. With respect to the Ratable Loans as
a whole, each Election and each Conversion shall be in an amount at least equal
to $1,000,000 and in integral multiples of $500,000.
Section 2.14 Certain Notices Regarding Elections, Conversions and
Continuations of Loans. Notices by Borrower to Administrative Agent of
Elections, Conversions and Continuations of LIBOR Loans shall be irrevocable and
shall be effective only if received by Administrative Agent not later than 10:30
a.m. (New York time) on the number of Banking Days prior to the date of the
relevant Election, Conversion or Continuation specified below:
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<TABLE>
<CAPTION>
Number of Banking
Notice Days Prior
------ -----------------
<S> <C>
Conversions into Base Rate
Loans two (2)
Elections of, Conversions into or
Continuations as, LIBOR Loans three (3)
</TABLE>
Promptly following its receipt of any such notice, and no later than the close
of business on the Banking Day of such receipt, Administrative Agent shall so
advise the Banks either by telephone or by facsimile. Each such notice of
Election shall specify the portion of the amount of the advance that is to be
LIBOR Loans (subject to Section 2.13) and the duration of the Interest Period
applicable thereto (subject to Section 2.05); each such notice of Conversion
shall specify the LIBOR Loans or Base Rate Loans to be Converted; and each such
notice of Conversion or Continuation shall specify the date of Conversion or
Continuation (which shall be a Banking Day), the amount thereof (subject to
Section 2.13) and the duration of the Interest Period applicable thereto
(subject to Section 2.05). In the event that Borrower fails to Elect to have any
portion of an advance of the Ratable Loans be LIBOR Loans, the entire amount of
such advance shall constitute Base Rate Loans. In the event that Borrower fails
to Continue LIBOR Loans within the time period and as otherwise provided in this
Section, such LIBOR Loans will automatically become LIBOR Loans with an Interest
Period of one (1) month on the last day of the then current applicable Interest
Period for such LIBOR Loans. Administrative Agent shall notify each of the
Banks, either by telephone or by facsimile, at least two (2) Banking Days prior
to the termination of the Interest Period in question in the event of such
failure by Borrower.
Section 2.15 Late Payment Premium. Borrower shall, at
Administrative Agent's option and upon notice to Borrower, pay to Administrative
Agent for the account of the Banks a late payment premium in the amount of 4% of
any payments of interest under the Loans made more than ten (10) days after the
due date thereof, which shall be due with any such late payment.
Section 2.16 Letters of Credit. (a) Borrower, by notice to
Administrative Agent, may request, in lieu of advances of proceeds of the
Ratable Loans, that Administrative Agent issue unconditional, irrevocable
standby letters of credit (each, a "Letter of Credit") for the account of
Borrower, payable by sight drafts, for such beneficiaries and with such other
terms as Borrower shall specify. Promptly upon issuance of a Letter of Credit,
Administrative Agent shall notify each of the Banks.
(b) The amount of any Letter of Credit shall be limited to the lesser
of (x) $75,000,000 less the aggregate amount of all Letters of Credit
theretofore issued or (y) the Available Total Loan Commitment, it being
understood that the amount of each Letter of Credit issued and outstanding shall
effect a reduction, by an equal amount, of the Available Total Loan Commitment
(such reduction to be allocated to each Bank's Ratable Loan ratably in
accordance with the Banks' respective Pro Rata Shares).
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<PAGE> 33
(c) The amount of each Letter of Credit shall be further subject to
the limitations applicable to amounts of advances set forth in Section 2.03 and
the procedures for the issuance of each Letter of Credit shall be the same as
the procedures applicable to the making of advances as set forth in the first
sentence of Section 2.04. Administrative Agent's issuance of each Letter of
Credit shall be subject to Administrative Agent's determination that Borrower
has satisfied all conditions precedent to its entitlement to an advance of
proceeds of the Loans.
(d) Each Letter of Credit shall expire no later than one (1) month
prior to the Maturity Date, but may have a so-called "evergreen" clause allowing
for the extension of the expiration date thereof upon the extension of the
Maturity Date pursuant to Section 2.19.
(e) In connection with, and as a further condition to the issuance
of, each Letter of Credit, Borrower shall execute and deliver to Administrative
Agent an application for the Letter of Credit on Administrative Agent's standard
form therefor, together with such other documents, opinions and assurances as
Administrative Agent shall reasonably require.
(f) In connection with each Letter of Credit, Borrower hereby
covenants to pay to Administrative Agent the following fees: (1) a fee, payable
quarterly in arrears (on the first Banking Day of each calendar quarter
following the issuance of the Letter of Credit), for the account of the Banks,
computed daily on the amount of the Letter of Credit issued and outstanding at a
rate per annum equal to the "Banks' L/C Fee Rate" (as hereinafter defined) and
(2) the fee, for Administrative Agent's own account, required by the
Supplemental Fee Letter between Borrower and Fleet. For purposes of this
Agreement, the "Banks' L/C Fee Rate" shall mean, at any time, a rate per annum
equal to the Applicable Margin for LIBOR Loans less 0.125% per annum. It is
understood and agreed that the last installment of the fees provided for in this
paragraph (f) with respect to any particular Letter of Credit shall be due and
payable on the first day of the calendar quarter following the return, undrawn,
or cancellation of such Letter of Credit and Borrower's receipt of notice from
Administrative Agent.
(g) The parties hereto acknowledge and agree that, immediately upon
notice from Administrative Agent of any drawing under a Letter of Credit, each
Bank shall, notwithstanding the existence of a Default or Event of Default or
the non-satisfaction of any conditions precedent to the making of an advance of
the Loans, advance proceeds of its Ratable Loan, in an amount equal to its Pro
Rata Share of such drawing, which advance shall be made to Administrative Agent
to reimburse Administrative Agent, for its own account, for such drawing. Each
of the Banks further acknowledges that its obligation to fund its Pro Rata Share
of drawings under Letters of Credit as aforesaid shall survive the Banks'
termination of this Agreement or enforcement of remedies hereunder or under the
other Loan Documents.
(h) Borrower agrees, upon the occurrence of an Event of Default and
at the written request of Administrative Agent, (1) to deposit with
Administrative Agent cash collateral in the amount of all the outstanding
Letters of Credit, which cash collateral shall be held by Administrative Agent
as security for Borrower's obligations in connection with the Letters of Credit
and (2) to execute and deliver to Administrative Agent such documents as
Administrative Agent reasonably requests to confirm and perfect the assignment
of such cash collateral to Administrative Agent.
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Section 2.17 Intentionally Omitted.
Section 2.18 Swing Loans. (a) During the term of this Agreement,
the Swing Lender agrees, on the terms and conditions set forth in this
Agreement, to make advances to Borrower pursuant to this Section from time to
time in amounts such that (i) the aggregate of such advance and amount of Swing
Loans theretofore advanced and still outstanding does not at any time exceed the
Swing Loan Commitment and (ii) the amount of such advance does not exceed the
Available Total Loan Commitment. Each advance under this Section shall be in an
aggregate principal amount of $1,000,000 or a larger multiple of $100,000
(except that any such advance may be in the aggregate available amount of Swing
Loans determined in accordance with the immediately preceding sentence). With
the foregoing limits, Borrower may borrow under this Section, repay or, to the
extent permitted by Section 2.09, prepay Swing Loans and reborrow under this
Section at any time during the term of this Agreement.
(b) The Swing Lender shall, on behalf of Borrower (which hereby
irrevocably directs the Swing Lender to act on its behalf), on notice given by
the Swing Lender no later than 1:00 p.m. (New York time) on the Banking Day
immediately following the funding of any Swing Loan, request each Bank to make,
and each Bank hereby agrees to make, an advance of its Ratable Loan, in an
amount (with respect to each Bank, its "Swing Loan Refund Amount") equal to such
Bank's Pro Rata Share of the aggregate principal amount of the Swing Loans (the
"Refunded Swing Loans") outstanding on the date of such notice, to repay the
Swing Lender. Unless any of the events described in paragraph (5) of Section
9.01 with respect to Borrower shall have occurred and be continuing (in which
case the procedures of paragraph (c) of this Section shall apply), each Bank
shall make such advance of its Ratable Loan available to Administrative Agent at
Administrative Agent's Office in immediately available funds, not later than
1:00 p.m. (New York time), on the third Banking Day immediately following the
date of such notice. Administrative Agent shall pay the proceeds of such advance
of Ratable Loans to the Swing Lender, which shall immediately apply such
proceeds to repay Refunded Swing Loans. Effective on the day such advances of
Ratable Loans are made, the portion of the Swing Loans so paid shall no longer
be outstanding as Swing Loans, shall no longer be due as Swing Loans under the
Swing Loan Note held by the Swing Lender, and shall be due as Ratable Loans
under the respective Ratable Loan Notes issued to the Banks (including the Swing
Lender). Borrower authorizes the Swing Lender to charge Borrower's accounts with
Administrative Agent (up to the amount available in each such accounts) in order
to immediately pay the amount of such Refunded Swing Loans to the extent amounts
received from the Banks are not sufficient to repay in full such Refunded Swing
Loans.
(c) If, prior to the time advances of Ratable Loans would have
otherwise been made pursuant to paragraph (b) of this Section, one of the events
described in paragraph (5) of Section 9.01 with respect to the Borrower shall
have occurred and be continuing, each Bank shall, on the date such advances were
to have been made pursuant to the notice referred to in paragraph (b) of this
Section (the "Refunding Date"), purchase an undivided participating interest in
the Swing Loans in an amount equal to such Bank's Swing Loan Refund Amount. On
the Refunding Date, each Bank shall transfer to the Swing Lender, in immediately
available funds, such Bank's Swing Loan Refund Amount, and upon receipt thereof,
the Swing Lender shall deliver to such Bank a Swing Loan participation
certificate dated the date of the Swing Lender's receipt of such funds and in
the Swing Loan Refund Amount of such Bank.
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(d) Whenever, at any time after the Swing Lender has received from
any Bank such Bank's Swing Loan Refund Amount pursuant to paragraph (c) of this
Section, the Swing Lender receive any payment on account of the Swing Loans in
which the Banks have purchased participations pursuant to said paragraph (c),
the Swing Lender will promptly distribute to each such Bank its ratable share
(determined on the basis of the Swing Loan Refund Amounts of all of the Banks)
of such payment (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Bank's participating interest was
outstanding and funded); provided, however, that in the event that such payment
received by the Swing Lender is required to be returned, such Bank will return
to the Swing Lender any portion thereof previously distributed to it by the
Swing Lender.
(e) Each Bank's obligation to transfer the amount of a Loan to the
Swing Lender as provided in paragraph (b) of this Section or to purchase a
participating interest pursuant to paragraph (c) of this Section shall be
absolute and unconditional and shall not be affected by any circumstance,
including, without limitation, (i) any set-off, counterclaim, recoupment,
defense or other right which such Bank, Borrower or any other Person may have
against the Swing Lender or any other Person, (ii) the occurrence or continuance
of a Default or an Event of Default, the termination or reduction of the Loan
Commitments or the non-satisfaction of any condition precedent to the making of
any advance of the Loans, (iii) any adverse change in the condition (financial
or otherwise) of Borrower or any other Person, (iv) any breach of this Agreement
by Borrower, any other Bank or any other Person or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing.
(f) Notwithstanding anything above in this Section or elsewhere in
this Agreement to the contrary, in the event that the Swing Lender funds a Swing
Loan hereunder when it has actual knowledge that a monetary Default, or material
Event of Default (which, for the avoidance of doubt shall include any violation
of any provision of Article VII or Article VIII) has occurred and is continuing,
the Banks shall have the option to make Ratable Loans to fund their ratable
shares of such Swing Loan as contemplated in paragraph (b) of this Section or to
purchase participations as contemplated in paragraph (c) of this Section.
(g) For purposes of Article III, Swing Loans shall be deemed to be
LIBOR Loans.
Section 2.19 Extension Of Maturity. (a) Borrower shall have the
option (the "Extension Option") to extend the original Maturity Date for a
period of one (1) year. Subject to the conditions set forth below, Borrower may
exercise the Extension Option by delivering a written notice to Administrative
Agent not less than one hundred twenty (120) days prior to the original Maturity
Date (a "Notice to Extend"), stating that Borrower has elected to extend the
original Maturity Date for one (1) year. Borrower's delivery of the Notice to
Extend shall be irrevocable and Borrower's right to exercise the Extension
Option shall be subject to the following terms and conditions: (i) there shall
exist no Event of Default on both the date Borrower delivers the Notice to
Extend to Administrative Agent and on the original Maturity Date, (ii) Borrower
shall have paid to Administrative Agent for the account of each Bank an
extension fee equal to 0.10% of such Bank's Loan Commitment simultaneously with
delivery of the Notice to Extend and (iii) Borrower shall be in compliance with
the covenants contained in Articles VII and VIII.
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(b) If Borrower shall have effectively exercised the Extension Option
pursuant to paragraph (a) above, Borrower may request a one-year extension of
the Maturity Date, as so extended, by delivering a written request therefor to
Administrative Agent not more than six (6) months or less than one hundred
twenty (120) days prior to such Maturity Date (a "Request to Extend").
Administrative Agent shall notify the Banks of its receipt of the Request to
Extend and each Bank shall give notice in writing to Administrative Agent not
less than ninety (90) days prior to the Maturity Date to be extended of such
Bank's acceptance or rejection of such Request to Extend. If all the Banks shall
have notified Administrative Agent on or prior to the date which is ninety (90)
days prior to the Maturity Date to be extended that they accept such request,
the Maturity Date shall be extended for one (1) year. If any Bank shall not have
notified Administrative Agent on or prior to the date which is ninety (90) days
prior to the Maturity Date to be extended that it accepts such Request to
Extend, the Maturity Date shall not be extended. Administrative Agent shall
notify Borrower and the Banks whether the Request to Extend has been accepted by
all of the Banks. If the Request to Extend is accepted by all of the Banks, the
Maturity Date shall be extended for one (1) year. The effectiveness of the
acceptance of the Request to Extend shall be subject to the following terms and
conditions: (i) there shall exist no Event of Default on both the date Borrower
delivers the Request to Extend to Administrative Agent and on the Maturity Date
to be extended, (ii) Borrower shall pay to Administrative Agent for the account
of each Bank an extension fee equal to 0.10% of such Bank's Loan Commitment
within five (5) Banking Days after receipt of notice from Administrative Agent
that the Request to Extend has been accepted by all of the Banks and (iii)
Borrower shall be in compliance with the covenants contained in Articles VII and
VIII.
ARTICLE III
YIELD PROTECTION; ILLEGALITY, ETC.
Section 3.01 Additional Costs. Borrower shall pay directly to each
Bank from time to time on demand such amounts as such Bank may determine to be
necessary to compensate it for any increased costs which such Bank determines
are attributable to its making or maintaining a LIBOR Loan or a LIBOR Bid Rate
Loan, or its obligation to make or maintain a LIBOR Loan or a LIBOR Bid Rate
Loan, or its obligation to Convert a Base Rate Loan to a LIBOR Loan hereunder,
or any reduction in any amount receivable by such Bank hereunder in respect of
its LIBOR Loan or LIBOR Bid Rate Loan(s) or such obligations (such increases in
costs and reductions in amounts receivable being herein called "Additional
Costs"), in each case resulting from any Regulatory Change which:
(1) changes the basis of taxation of any amounts payable to such Bank
under this Agreement or the Notes in respect of any such LIBOR Loan or
LIBOR Bid Rate Loan (other than changes in the rate of general corporate,
franchise, branch profit, net income or other income tax imposed on such
Bank or its Applicable Lending Office by the jurisdiction in which such
Bank has its principal office or such Applicable Lending Office); or
(2) (other than to the extent the LIBOR Reserve Requirement is taken
into account in determining the LIBOR Rate at the commencement of the
applicable Interest Period) imposes or modifies any reserve, special
deposit, deposit insurance or
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assessment, minimum capital, capital ratio or similar requirements relating
to any extensions of credit or other assets of, or any deposits with or
other liabilities of, such Bank (including any LIBOR Loan or LIBOR Bid Rate
Loan or any deposits referred to in the definition of "LIBOR Interest Rate"
in Section 1.01), or any commitment of such Bank (including such Bank's
Loan Commitment hereunder); or
(3) imposes any other condition affecting this Agreement or the Notes
(or any of such extensions of credit or liabilities).
Without limiting the effect of the provisions of the first paragraph
of this Section, in the event that, by reason of any Regulatory Change, any Bank
either (1) incurs Additional Costs based on or measured by the excess above a
specified level of the amount of a category of deposits of other liabilities of
such Bank which includes deposits by reference to which the LIBOR Interest Rate
is determined as provided in this Agreement or a category of extensions of
credit or other assets of such Bank which includes loans based on the LIBOR
Interest Rate or (2) becomes subject to restrictions on the amount of such a
category of liabilities or assets which it may hold, then, if such Bank so
elects by notice to Borrower (with a copy to Administrative Agent), the
obligation of such Bank to permit Elections of, to Continue, or to Convert Base
Rate Loans into, LIBOR Loans shall be suspended (in which case the provisions of
Section 3.04 shall be applicable) until such Regulatory Change ceases to be in
effect.
Determinations and allocations by a Bank for purposes of this Section
of the effect of any Regulatory Change pursuant to the first or second paragraph
of this Section, on its costs or rate of return of making or maintaining its
Loan or portions thereof or on amounts receivable by it in respect of its Loan
or portions thereof, and the amounts required to compensate such Bank under this
Section, shall be included in a calculation of such amounts given to Borrower
and shall be conclusive absent manifest error.
Section 3.02 Limitation on Types of Loans. Anything herein to the
contrary notwithstanding, if, on or prior to the determination of the LIBOR
Interest Rate for any Interest Period:
(1) Administrative Agent reasonably determines (which determination
shall be conclusive), and provides Borrower, in writing, with reasonable
detail supporting such determination, that quotations of interest rates for
the relevant deposits referred to in the definition of "LIBOR Interest
Rate" in Section 1.01 are not being provided in the relevant amounts or for
the relevant maturities for purposes of determining rates of interest for
the LIBOR Loans or LIBOR Bid Rate Loans as provided in this Agreement; or
(2) a Bank reasonably determines (which determination shall be
conclusive), and provides Borrower, in writing, with reasonable detail
supporting such determination, and promptly notifies Administrative Agent
that the relevant rates of interest referred to in the definition of "LIBOR
Interest Rate" in Section 1.01 upon the basis of which the rate of interest
for LIBOR Loans or LIBOR Bid Rate Loans for such Interest Period is to be
determined do not adequately cover the cost to such Bank of making or
maintaining such LIBOR Loan or LIBOR Bid Rate Loan for such Interest
Period;
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then Administrative Agent shall give Borrower prompt notice thereof, and so long
as such condition remains in effect, the Banks (or, in the case of the
circumstances described in clause (2) above, the affected Bank) shall be under
no obligation to permit Elections of LIBOR Loans, to Convert Base Rate Loans
into LIBOR Loans or to Continue LIBOR Loans and Borrower shall, on the last
day(s) of the then current Interest Period(s) for the affected outstanding LIBOR
Loans or LIBOR Bid Rate Loans, either (x) prepay the affected LIBOR Loans or
LIBOR Bid Rate Loans or (y) Convert the affected LIBOR Loans into Base Rate
Loans in accordance with Section 2.12 or convert the rate of interest under the
affected LIBOR Bid Rate Loans to the rate applicable to Base Rate Loans by
following the same procedures as are applicable for Conversions into Base Rate
Loans set forth in Section 2.12.
Section 3.03 Illegality. Notwithstanding any other provision of
this Agreement, in the event that it becomes unlawful for any Bank or its
Applicable Lending Office to honor its obligation to make or maintain a LIBOR
Loan or LIBOR Bid Rate Loan hereunder, to allow Elections of a LIBOR Loan or to
Convert a Base Rate Loan into a LIBOR Loan, then such Bank shall promptly notify
Administrative Agent and Borrower thereof and such Bank's obligation to make or
maintain a LIBOR Loan or LIBOR Bid Rate Loan, or to permit Elections of, to
Continue, or to Convert its Base Rate Loan into, a LIBOR Loan shall be suspended
(in which case the provisions of Section 3.04 shall be applicable) until such
time as such Bank may again make and maintain a LIBOR Loan or a LIBOR Bid Rate
Loan.
Section 3.04 Treatment of Affected Loans. If the obligations of any
Bank to make or maintain a LIBOR Loan or a LIBOR Bid Rate Loan, or to permit an
Election of a LIBOR Loan, to Continue its LIBOR Loan, or to Convert its Base
Rate Loan into a LIBOR Loan, are suspended pursuant to Sections 3.01 or 3.03
(each LIBOR Loan or LIBOR Bid Rate Loan so affected being herein called an
"Affected Loan"), such Bank's Affected Loan shall be automatically Converted
into a Base Rate Loan (or, in the case of an Affected Loan that is a LIBOR Bid
Rate Loan, the interest rate thereon shall be converted to the rate applicable
to Base Rate Loans) on the last day of the then current Interest Period for the
Affected Loan (or, in the case of a Conversion (or conversion) required by
Sections 3.01 or 3.03, on such earlier date as such Bank may specify to
Borrower).
To the extent that such Bank's Affected Loan has been so Converted
(or the interest rate thereon so converted), all payments and prepayments of
principal which would otherwise be applied to such Bank's Affected Loan shall be
applied instead to its Base Rate Loan (or to its LIBOR Bid Rate Loan bearing
interest at the converted rate) and such Bank shall have no obligation to
Convert its Base Rate Loan into a LIBOR Loan.
Section 3.05 Certain Compensation. Other than in connection with a
Conversion of an Affected Loan, Borrower shall pay to Administrative Agent for
the account of the applicable Bank, upon the request of such Bank through
Administrative Agent which request includes a calculation of the amount(s) due,
such amount or amounts as shall be sufficient (in the reasonable opinion of such
Bank) to compensate it for any loss, cost or expense which such Bank reasonably
determines is attributable to:
(1) any payment or prepayment of a LIBOR Loan or Bid Rate Loan made
by such Bank, or any Conversion or Continuation of a LIBOR Loan made by
such Bank, in any
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such case on a date other than the last day of an applicable Interest
Period, whether by reason of acceleration or otherwise; or
(2) any failure by Borrower for any reason to Convert or Continue a
LIBOR Loan to be Converted or Continued by such Bank on the date specified
there for in the relevant notice under Section 2.14; or
(3) any failure by Borrower to borrow (or to qualify for a borrowing
of) a LIBOR Loan or Bid Rate Loan which would otherwise be made hereunder
on the date specified in the relevant Election notice under Section 2.14 or
Bid Rate Quote acceptance under Section 2.02(e) given or submitted by
Borrower.
Without limiting the foregoing, such compensation shall include any
loss incurred in obtaining, liquidating or employing deposits from third
parties, but excluding loss of margin for the period after the date of such
payment, prepayment, Conversion or Continuation (or failure to Convert, Continue
or borrow). A determination of any Bank as to the amounts payable pursuant to
this Section shall be conclusive absent manifest error.
Section 3.06 Capital Adequacy. If any Bank shall have determined
that, after the date hereof, the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change therein, or any change in
the interpretation or administration thereof by any Governmental Authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such Governmental Authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on capital of such Bank (or its Parent) as a consequence of such
Bank's obligations hereunder to a level below that which such Bank (or its
Parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, then from time to time, within
fifteen (15) days after demand by such Bank (with a copy to Administrative
Agent), Borrower shall pay to such Bank such additional amount or amounts as
will compensate such Bank (or its Parent) for such reduction. A certificate of
any Bank claiming compensation under this Section, setting forth in reasonable
detail the basis therefor, shall be conclusive absent manifest error.
Section 3.07 Substitution of Banks. If any Bank (an "Affected
Bank") (1) makes demand upon Borrower for (or if Borrower is otherwise required
to pay) Additional Costs pursuant to Section 3.01 or (2) is unable to make or
maintain a LIBOR Loan or LIBOR Bid Rate Loan as a result of a condition
described in Section 3.03 or clause (2) of Section 3.02, Borrower may, within
ninety (90) days of receipt of such demand or notice (or the occurrence of such
other event causing Borrower to be required to pay Additional Costs or causing
said Section 3.03 or clause (2) of Section 3.02 to be applicable), as the case
may be, give written notice (a "Replacement Notice") to Administrative Agent and
to each Bank of Borrower's intention either (x) to prepay in full the Affected
Bank's Note and to terminate the Affected Bank's entire Loan Commitment or (y)
to replace the Affected Bank with another financial institution (the
"Replacement Bank") designated in such Replacement Notice.
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In the event Borrower opts to give the notice provided for in clause
(x) above, and if the Affected Bank shall not agree within thirty (30) days of
its receipt thereof to waive the payment of the Additional Costs in question or
the effect of the circumstances described in Section 3.03 or clause (2) of
Section 3.02, then, so long as no Default or Event of Default shall exist,
Borrower may (notwithstanding the provisions of clause (2) of Section 2.10(a))
terminate the Affected Bank's entire Loan Commitment, provided that in
connection therewith it pays to the Affected Bank all outstanding principal and
accrued and unpaid interest under the Affected Bank's Note, together with all
other amounts, if any, due from Borrower to the Affected Bank, including all
amounts properly demanded and unreimbursed under Sections 3.01 and 3.05.
In the event Borrower opts to give the notice provided for in clause
(y) above, and if (i) Administrative Agent shall, within thirty (30) days of its
receipt of the Replacement Notice, notify Borrower and each Bank in writing that
the Replacement Bank is reasonably satisfactory to Administrative Agent and (ii)
the Affected Bank shall not, prior to the end of such thirty (30)-day period,
agree to waive the payment of the Additional Costs in question or the effect of
the circumstances described in Section 3.03 or clause (2) of Section 3.02, then
the Affected Bank shall, so long as no Default or Event of Default shall exist,
assign its Note and all of its rights and obligations under this Agreement to
the Replacement Bank, and the Replacement Bank shall assume all of the Affected
Bank's rights and obligations, pursuant to an agreement, substantially in the
form of an Assignment and Assumption Agreement, executed by the Affected Bank
and the Replacement Bank. In connection with such assignment and assumption, the
Replacement Bank shall pay to the Affected Bank an amount equal to the
outstanding principal amount under the Affected Bank's Note plus all interest
accrued thereon, plus all other amounts, if any (other than the Additional Costs
in question), then due and payable to the Affected Bank; provided, however, that
prior to or simultaneously with any such assignment and assumption, Borrower
shall have paid to such Affected Bank all amounts properly demanded and
unreimbursed under Sections 3.01 and 3.05. Upon the effective date of such
assignment and assumption, the Replacement Bank shall become a Bank Party to
this Agreement and shall have all the rights and obligations of a Bank as set
forth in such Assignment and Assumption Agreement, and the Affected Bank shall
be released from its obligations hereunder, and no further consent or action by
any party shall be required. Upon the consummation of any assignment pursuant to
this Section, a substitute Ratable Loan Note (and, if applicable, Swing Loan
Note) shall be issued to the Replacement Bank by Borrower, in exchange for the
return of the Affected Bank's Ratable Loan Note (and, if applicable, Swing Loan
Note). The obligations evidenced by such substitute note shall constitute
"Obligations" for all purposes of this Agreement and the other Loan Documents.
In connection with Borrower's execution of substitute notes as aforesaid,
Borrower shall deliver to Administrative Agent evidence, satisfactory to
Administrative Agent, of all requisite corporate action to authorize Borrower's
execution and delivery of the substitute notes and any related documents. If the
Replacement Bank is not incorporated under the laws of the United States of
America or a state thereof, it shall, prior to the first date on which interest
or fees are payable hereunder for its account, deliver to Borrower and
Administrative Agent certification as to exemption from deduction or withholding
of any United States federal income taxes in accordance with Section 10.13. Each
Replacement Bank shall be deemed to have made the representations contained in,
and shall be bound by the provisions of, Section 10.13.
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Borrower, Administrative Agent and the Banks shall execute such
modifications to the Loan Documents as shall be reasonably required in
connection with and to effectuate the foregoing.
Section 3.08 Applicability. The provisions of this Article III
shall be applied to Borrower so as not to discriminate against Borrower
vis-a-vis similarly situated customers of the Banks.
ARTICLE IV
CONDITIONS PRECEDENT
Section 4.01 Conditions Precedent to the Initial Advance. The
obligations of the Banks hereunder and the obligation of each Bank to make the
Initial Advance are subject to the condition precedent that Co-Agents shall have
received and approved on or before the Closing Date (other than with respect to
paragraph (10) below which shall be required prior to the Initial Advance) each
of the following documents, and each of the following requirements shall have
been fulfilled:
(1) Fees and Expenses. The payment of (a) all fees and expenses
incurred by Co-Agents and Administrative Agent (including, without
limitation, the reasonable fees and expenses of legal counsel) and (b)
those fees specified in the Supplemental Fee Letter to be paid by Borrower
on or before the Closing Date;
(2) Notes. The Ratable Loan Notes for Fleet, Morgan, UBS and each of
the other Banks signatory hereto, the Bid Rate Loan Note for Fleet, as
Administrative Agent, and the Swing Note for the Swing Lender, each duly
executed by Borrower;
(3) Financial Statements. (a) Audited Consolidated Financial
Statements of Avalon and Bay as of and for the year ended December 31,
1997, (b) unaudited Consolidated Financial Statements of Avalon and Bay,
each certified by the chief financial officer thereof and as of and for the
quarter ended March 31, 1998 and (c) the most recently prepared audited
Borrower's Consolidated Financial Statements;
(4) Evidence of Formation of Borrower. Certified (as of the Closing
Date) copies of Borrower's certificate of incorporation and by-laws, with
all amendments thereto, and a certificate of the Secretary of State of the
jurisdiction of formation as to its good standing therein;
(5) Evidence of All Corporate Action. Certified (as of the Closing
Date) copies of all documents evidencing the corporate action taken by
Borrower authorizing the execution, delivery and performance of the Loan
Documents and each other document to be delivered by or on behalf of
Borrower pursuant to this Agreement;
(6) Incumbency and Signature Certificate of Borrower. A certificate
(dated as of the Closing Date) of the secretary of Borrower certifying the
names and true signatures of each person authorized to sign on behalf of
Borrower;
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(7) Solvency Certificate. A duly executed Solvency Certificate;
(8) Opinion of Counsel for Borrower. A favorable opinion, dated the
Closing Date, of Goodwin, Procter & Hoar, counsel for Borrower, as to such
matters as Administrative Agent may reasonably request;
(9) Authorization Letter. The Authorization Letter, duly executed by
Borrower;
(10) Request for Advance. A request for an advance in accordance
with Section 2.04;
(11) Certificate. The following statements shall be true and
Administrative Agent shall have received a certificate dated the Closing
Date signed by a duly authorized signatory of Borrower stating, to the best
of the certifying party's knowledge, the following:
(a) All representations and warranties contained in this Agreement and
in each of the other Loan Documents are true and correct on and as of the
Closing Date as though made on and as of such date, and
(b) No Default or Event of Default has occurred and is continuing, or
could result from the transactions contemplated by this Agreement and the
other Loan Documents;
(12) Supplemental Fee Letter. The Supplemental Fee Letter, duly
executed by Borrower;
(13) Corporate Merger and Termination of Other Credit Facilities.
Satisfactory evidence that (a) the merger of Avalon and Bay into Borrower
has been effectively completed in accordance with all applicable Laws and
(b) any and all existing credit facilities of Avalon and of Bay have been
effectively terminated;
(14) Covenant Compliance. A covenant compliance certificate of the
sort required by paragraph (3) of Section 6.09;
(15) Material Adverse Change. There shall exist no Material Adverse
Change; and
(16) Additional Materials. Such other approvals, documents,
instruments or opinions as Administrative Agent or any Co-Agent may
reasonably request.
Section 4.02 Conditions Precedent to Advances After the Initial
Advance. The obligation of each Bank to make advances of the Loans subsequent to
the Initial Advance shall be subject to satisfaction of the following conditions
precedent:
(1) All conditions of Section 4.01 shall have been and remain
satisfied as of the date of the advance;
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(2) No Default or Event of Default shall have occurred and be
continuing as of the date of the advance;
(3) Each of the representations and warranties contained in this
Agreement and in each of the other Loan Documents shall be true and correct
in all material respects as of the date of the advance; and
(4) Administrative Agent shall have received a request for an advance
in accordance with Section 2.04.
Section 4.03 Deemed Representations. Each request by Borrower for,
and acceptance by Borrower of, an advance of proceeds of the Loans shall
constitute a representation and warranty by Borrower that, as of both the date
of such request and the date of the advance (1) no Default or Event of Default
has occurred and is continuing and (2) each representation or warranty contained
in this Agreement or the other Loan Documents is true and correct in all
material respects.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Administrative Agent and each
Bank as follows:
Section 5.01 Due Organization. Borrower is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, has the power and authority to own its assets and to transact the
business in which it is now engaged, and, if applicable, is duly qualified for
the conduct of business and in good standing under the laws of each other
jurisdiction in which such qualification is required and where the failure to be
so qualified would cause a Material Adverse Change.
Section 5.02 Power and Authority; No Conflicts; Compliance With
Laws. The execution, delivery and performance of the obligations required to be
performed by Borrower of the Loan Documents does not and will not (a) require
the consent or approval of its shareholders or such consent or approval has been
obtained, (b) contravene either its certificate of incorporation or by-laws, (c)
to the best of Borrower's knowledge, violate any provision of, or require any
filing, registration, consent or approval under, any Law (including, without
limitation, Regulation U), order, writ, judgment, injunction, decree,
determination or award presently in effect having applicability to it, (d)
result in a breach of or constitute a default under or require any consent under
any indenture or loan or credit agreement or any other agreement, lease or
instrument to which it may be a party or by which it or its properties may be
bound or affected except for consents which have been obtained, (e) result in,
or require, the creation or imposition of any Lien, upon or with respect to any
of its properties now owned or hereafter acquired, or (f) to the best of
Borrower's knowledge, cause it to be in default under any such Law, order, writ,
judgment, injunction, decree, determination or award or any such indenture,
agreement, lease or instrument; to the best of its knowledge, Borrower is in
material compliance with all Laws applicable to it and its properties.
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Section 5.03 Legally Enforceable Agreements. Each Loan Document is
a legal, valid and binding obligation of Borrower, enforceable against Borrower
in accordance with its terms, except to the extent that such enforcement may be
limited by applicable bankruptcy, insolvency and other similar laws affecting
creditors' rights generally.
Section 5.04 Litigation. There are no actions, suits or proceedings
pending or, to its knowledge, threatened against Borrower or any of its
Affiliates before any court or arbitrator or any Governmental Authority which
are reasonably likely to result in a Material Adverse Change.
Section 5.05 Good Title to Properties. Borrower and each of its
Material Affiliates have good, marketable and legal title to all of the
properties and assets each of them purports to own (including, without
limitation, those reflected in the Consolidated Financial Statements referred to
in Section 5.13), only with exceptions which do not materially detract from the
value of such property or assets or the use thereof in Borrower's and such
Material Affiliate's business, and except to the extent that any such properties
and assets have been encumbered or disposed of since the date of such financial
statements without violating any of the covenants contained in Article VII or
elsewhere in this Agreement. Borrower and its Material Affiliates enjoy peaceful
and undisturbed possession of all leased property necessary in any material
respect in the conduct of their respective businesses. All such leases are valid
and subsisting and are in full force and effect.
Section 5.06 Taxes. Borrower has filed all tax returns (federal,
state and local) required to be filed and has paid all taxes, assessments and
governmental charges and levies due and payable without the imposition of a
penalty, including interest and penalties, except to the extent they are the
subject of a Good Faith Contest.
Section 5.07 ERISA. Borrower is in compliance in all material
respects with all applicable provisions of ERISA. Neither a Reportable Event nor
a Prohibited Transaction has occurred with respect to any Plan which could
result in liability of Borrower; no notice of intent to terminate a Plan has
been filed nor has any Plan been terminated within the past five (5) years; no
circumstance exists which constitutes grounds under Section 4042 of ERISA
entitling the PBGC to institute proceedings to terminate, or appoint a trustee
to administer, a Plan, nor has the PBGC instituted any such proceedings;
Borrower and the ERISA Affiliates have not completely or partially withdrawn
under Sections 4201 or 4204 of ERISA from a Multiemployer Plan; Borrower and the
ERISA Affiliates have met the minimum funding requirements of Section 412 of the
Code and Section 302 of ERISA of each with respect to the Plans of each and
there is no material "Unfunded Current Liability" (as such quoted term is
defined in ERISA) with respect to any Plan established or maintained by each;
and Borrower and the ERISA Affiliates have not incurred any liability to the
PBGC under ERISA (other than for the payment of premiums under Section 4007 of
ERISA). No part of the funds to be used by Borrower in satisfaction of its
obligations under this Agreement constitute "plan assets" of any "employee
benefit plan" within the meaning of ERISA or of any "plan" within the meaning of
Section 4975(e)(1) of the Code, as interpreted by the Internal Revenue Service
and the U.S. Department of Labor in rules, regulations, releases, bulletins or
as interpreted under applicable case law.
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Section 5.08 No Default on Outstanding Judgments or Orders.
Borrower and each of its Material Affiliates have satisfied all judgments which
are not being appealed or which are not fully covered by insurance, and are not
in default with respect to any judgment, order, writ, injunction, decree, rule
or regulation of any court, arbitrator or federal, state, municipal or other
Governmental Authority, commission, board, bureau, agency or instrumentality,
domestic or foreign.
Section 5.09 No Defaults on Other Agreements. Except as disclosed
to Co-Agents and Administrative Agent in writing, Borrower is not a party to any
indenture, loan or credit agreement or any lease or other agreement or
instrument or subject to any partnership, trust or other restriction which is
likely to result in a Material Adverse Change. Borrower is not in default in any
respect in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any agreement or instrument which is likely
to result in a Material Adverse Change.
Section 5.10 Government Regulation. Borrower is not subject to
regulation under the Investment Company Act of 1940 or any statute or regulation
limiting its ability to incur indebtedness for money borrowed as contemplated
hereby.
Section 5.11 Environmental Protection. To the best of Borrower's
knowledge, none of Borrower's or its Material Affiliates' properties contains
any Hazardous Materials that, under any Environmental Law currently in effect,
(1) would impose liability on Borrower that is likely to result in a Material
Adverse Change, or (2) is likely to result in the imposition of a Lien on any
assets of Borrower or its Material Affiliates, in each case if not properly
handled in accordance with applicable Law or not covered by insurance or a bond,
in either case reasonably satisfactory to the Required Banks. To the best of
Borrower's knowledge, neither it nor any of its Material Affiliates is in
material violation of, or subject to any existing, pending or threatened
material investigation or proceeding by any Governmental Authority under any
Environmental Law.
Section 5.12 Solvency. Borrower is, and upon consummation of the
transactions contemplated by this Agreement, the other Loan Documents and any
other documents, instruments or agreements relating thereto, will be, Solvent.
Section 5.13 Financial Statements. The Consolidated Financial
Statements of Avalon, Bay and Borrower most recently delivered to the Banks
pursuant to the terms of this Agreement are in all material respects complete
and correct and fairly present the financial condition of the subjects thereof
as of the dates of and for the periods covered by such statements, all in
accordance with GAAP. There has been no Material Adverse Change since the date
of such most recently delivered Consolidated Financial Statements.
Section 5.14 Valid Existence of Affiliates. At the Closing Date,
the only Material Affiliates of Borrower are listed on EXHIBIT C. Each Material
Affiliate is a corporation duly organized and existing in good standing under
the laws of the jurisdiction of its formation. As to each Material Affiliate,
its correct name, the jurisdiction of its formation, Borrower's percentage of
beneficial interest therein, and the type of business in which it is primarily
engaged, are set forth on said EXHIBIT C. Borrower and each of its Material
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Affiliates have the power to own their respective properties and to carry on
their respective businesses now being conducted. Each Material Affiliate is duly
qualified as a foreign corporation to do business and is in good standing in
every jurisdiction in which the nature of the respective businesses conducted by
it or its respective properties, owned or held under lease, make such
qualification necessary and where the failure to be so qualified would cause a
Material Adverse Change.
Section 5.15 Insurance. Borrower and each of its Material
Affiliates have in force paid insurance with financially sound and reputable
insurance companies or associations in such amounts and covering such risks as
are usually carried by companies engaged in the same type of business and
similarly situated.
Section 5.16 Accuracy of Information; Full Disclosure. Neither this
Agreement nor any documents, financial statements, reports, notices, schedules,
certificates, statements or other writings furnished by or on behalf of Borrower
to Administrative Agent or any Bank in connection with the negotiation of this
Agreement or the consummation of the transactions contemplated hereby, or
required herein to be furnished by or on behalf of Borrower (other than
projections which are made by Borrower in good faith), contains any untrue or
misleading statement of a material fact or omits a material fact necessary to
make the statements herein or therein not misleading. To the best of Borrower's
knowledge, there is no fact which Borrower has not disclosed to Administrative
Agent and the Banks in writing which materially affects adversely nor, so far as
Borrower can now foresee, will materially affect adversely the business affairs
or financial condition of Borrower or the ability of Borrower to perform this
Agreement and the other Loan Documents.
Section 5.17 Corporate Merger and Termination of Other Credit
Facilities. The merger of Avalon and Bay into Borrower has been effectively
completed in accordance with all applicable Laws, and any and all existing
credit facilities of Avalon and Bay have been effectively terminated.
ARTICLE VI
AFFIRMATIVE COVENANTS
So long as any of the Notes shall remain unpaid or the Loan
Commitments remain in effect, or any other amount is owing by Borrower to any
Bank hereunder or under any other Loan Document, Borrower shall, and, in the
case of Sections 6.01 through 6.07, inclusive, shall cause each of its Material
Affiliates to:
Section 6.01 Maintenance of Existence. Preserve and maintain its
legal existence and good standing in the jurisdiction of its organization, and
qualify and remain qualified as a corporation in each other jurisdiction in
which such qualification is required except to the extent that failure to be so
qualified in such other jurisdictions is not likely to result in a Material
Adverse Change.
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Section 6.02 Maintenance of Records. Keep adequate records and
books of account, in which complete entries will be made reflecting all of its
financial transactions, in accordance with GAAP.
Section 6.03 Maintenance of Insurance. At all times, maintain and
keep in force insurance with financially sound and reputable insurance companies
or associations in such amounts and covering such risks as are usually carried
by companies engaged in the same type of business and similarly situated, which
insurance shall be acceptable to Administrative Agent and may provide for
reasonable deductibility from coverage thereof. In connection with the
foregoing, it is understood that Borrower's earthquake insurance coverage in
place as of the Closing Date is acceptable to Administrative Agent.
Section 6.04 Compliance with Laws; Payment of Taxes. Comply in all
material respects with all Laws applicable to it or to any of its properties or
any part thereof, such compliance to include, without limitation, paying before
the same become delinquent all taxes, assessments and governmental charges
imposed upon it or upon its property, except to the extent they are the subject
of a Good Faith Contest.
Section 6.05 Right of Inspection. At any reasonable time and from
time to time upon reasonable notice, permit Administrative Agent or any Bank or
any agent or representative thereof to examine and make copies and abstracts
from its records and books of account and visit its properties and to discuss
its affairs, finances and accounts with the independent accountants of Borrower.
Section 6.06 Compliance With Environmental Laws. Comply in all
material respects with all applicable Environmental Laws and timely pay or cause
to be paid all costs and expenses incurred in connection with such compliance,
except to the extent there is a Good Faith Contest.
Section 6.07 Maintenance of Properties. Do all things reasonably
necessary to maintain, preserve, protect and keep its properties in good repair,
working order and condition except where the cost thereof is not in Borrower's
best interests and the failure to do so would not result in a Material Adverse
Change.
Section 6.08 Payment of Costs. Pay all costs and expenses required
for the satisfaction of the conditions of this Agreement.
Section 6.09 Reporting and Miscellaneous Document Requirements.
Furnish directly to Administrative Agent (who shall provide, promptly upon
receipt, to each of the Banks):
(1) Annual Financial Statements. As soon as available and in any
event within ninety (90) days after the end of each Fiscal Year, Borrower's
Consolidated Financial Statements as of the end of and for such Fiscal Year, in
reasonable detail and stating in comparative form the respective figures for the
corresponding date and period in the prior Fiscal Year and audited by Borrower's
Accountants;
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(2) Quarterly Financial Statements. As soon as available and in any
event within forty-five (45) days after the end of each calendar quarter (other
than the last quarter of the Fiscal Year), the unaudited Borrower's Consolidated
Financial Statements as of the end of and for such calendar quarter, in
reasonable detail and stating in comparative form the respective figures for the
corresponding date and period in the prior Fiscal Year;
(3) Certificate of No Default and Financial Compliance. Within
forty-five (45) days after the end of each calendar quarter, a certificate of
Borrower's chief financial officer or treasurer (a) stating that, to the best of
his or her knowledge, no Default or Event of Default has occurred and is
continuing, or if a Default or Event of Default has occurred and is continuing,
specifying the nature thereof and the action which is proposed to be taken with
respect thereto; (b) stating that the covenants contained in Sections 7.02 and
7.03 and in Article VIII have been complied with (or specifying those that have
not been complied with) and including computations demonstrating such compliance
(or non-compliance); (c) setting forth the details of all items comprising Total
Outstanding Indebtedness, Secured Indebtedness, Unencumbered Combined EBITDA,
Interest Expense and Unsecured Indebtedness (including amount, maturity,
interest rate and amortization requirements with respect to all Indebtedness and
including an occupancy report for each Unencumbered Wholly-Owned Asset for each
of the preceding four (4) calendar quarters and for such four (4) calendar
quarter-period as a whole); and (d) only at the end of each Fiscal Year, stating
Borrower's taxable income;
(4) Certificate of Borrower's Accountants. Simultaneously with the
delivery of the annual financial statements required by paragraph (1) of this
Section, (a) a statement of Borrower's Accountants who audited such financial
statements comparing the computations set forth in the financial compliance
certificate required by paragraph (3) of this Section to the audited financial
statements required by paragraph (1) of this Section and (b) when the audited
financial statements required by paragraph (1) of this Section have a qualified
auditor's opinion, a statement of Borrower's Accountants who audited such
financial statements of whether any Default or Event of Default has occurred and
is continuing;
(5) Notice of Litigation. Promptly after the commencement and
knowledge thereof, notice of all actions, suits, and proceedings before any
court or arbitrator, affecting Borrower which, if determined adversely to
Borrower is likely to result in a Material Adverse Change;
(6) Notices of Defaults and Events of Default. As soon as possible
and in any event within ten (10) days after Borrower becomes aware of the
occurrence of a material Default or any Event of Default, a written notice
setting forth the details of such Default or Event of Default and the action
which is proposed to be taken with respect thereto;
(7) Sales or Acquisitions of Assets. Promptly after the occurrence
thereof, written notice (which may be in the form of a press release sent to
Administrative Agent) of any Disposition or acquisition (including Acquisitions)
of assets (other than acquisitions or Dispositions of investments such as
certificates of deposit, Treasury securities, money market deposits and other
similar financial instruments in the ordinary course of Borrower's cash
management) with respect to which Borrower is required to file an "8-K",
together with, in the case of any acquisition of such an asset, copies of all
material agreements governing the
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acquisition and historical financial information and Borrower's projections with
respect to the property acquired;
(8) Material Adverse Change. As soon as is practicable and in any
event within five (5) days after knowledge of the occurrence of any event or
circumstance which is likely to result in or has resulted in a Material Adverse
Change, written notice thereof;
(9) Offices. Thirty (30) days' prior written notice of any change in
the chief executive office or principal place of business of Borrower;
(10) Environmental and Other Notices. As soon as possible and in any
event within ten (10) days after receipt, copies of all Environmental Notices
received by Borrower which are not received in the ordinary course of business
and which relate to a situation which is likely to result in a Material Adverse
Change;
(11) Insurance Coverage. Promptly, such information concerning
Borrower's insurance coverage as Administrative Agent may reasonably request;
(12) Proxy Statements, Etc.. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and reports which
Borrower or its Material Affiliates sends to its shareholders, and copies of all
regular, periodic and special reports, and all registration statements which
Borrower or its Material Affiliates files with the Securities and Exchange
Commission or any Governmental Authority which may be substituted therefor, or
with any national securities exchange;
(13) Operating Statements. As soon as available and in any event
within forty-five (45) days after the end of each calendar quarter, an operating
statement for each property directly or indirectly owned in whole or in part by
Borrower;
(14) Capital Expenditures. As soon as available and in any event
within forty-five (45) days after the end of each Fiscal Year, a schedule of
such Fiscal Year's capital expenditures and a budget for the next Fiscal Year's
planned capital expenditures for each property directly or indirectly owned in
whole or in part by Borrower; and
(15) General Information. Promptly, such other information respecting
the condition or operations, financial or otherwise, of Borrower or any
properties of Borrower as Administrative Agent may from time to time reasonably
request.
Section 6.10 Principal Prepayments as a Result of Reduction in
Total Loan Commitment. If the outstanding principal amount under the Notes at
any time exceeds the Total Loan Commitment, Borrower shall, within ten (10) days
of Administration Agent's written demand, make a payment in the amount of such
excess in reduction of such outstanding principal balance.
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ARTICLE VII
NEGATIVE COVENANTS
So long as any of the Notes shall remain unpaid, or the Loan
Commitments remain in effect, or any other amount is owing by Borrower to
Administrative Agent or any Bank hereunder or under any other Loan Document,
Borrower shall not do any or all of the following:
Section 7.01 Mergers Etc. Merge or consolidate with (except where
Borrower is the surviving entity), or sell, assign, lease or otherwise dispose
of (whether in one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired).
Section 7.02 Investments. Directly or indirectly, make any loan or
advance to any Person or purchase or otherwise acquire any capital stock,
assets, obligations or other securities of, make any capital contribution to, or
otherwise invest in, or acquire any interest in, any Person (any such
transaction, an "Investment") if such Investment constitutes the acquisition of
a minority interest in a Person (a "Minority Interest") and the amount of such
Investment, together with the value of all other Minority Interests acquired
after the Closing Date, would exceed 15% of Capitalization Value, determined as
of the end of the most recent calendar quarter for which Borrower is required to
have reported financial results pursuant to Section 6.09. A 50% beneficial
interest in a Person, in connection with which the holder thereof exercises
joint control over such Person with the holder(s) of the other 50% beneficial
interest, shall not constitute a "Minority Interest" for purposes of this
Section.
Section 7.03 Sale of Assets. Effect a Disposition of any of its now
owned or hereafter acquired assets, including assets in which Borrower owns a
beneficial interest through its ownership of interests in joint ventures,
aggregating more than 25% of Capitalization Value.
ARTICLE VIII
FINANCIAL COVENANTS
So long as any of the Notes shall remain unpaid, or the Loan
Commitments remain in effect, or any other amount is owing by Borrower to
Administrative Agent or any Bank under this Agreement or under any other Loan
Document, Borrower shall not permit or suffer any or all of the following:
Section 8.01 Consolidated Tangible Net Worth. At any time,
Consolidated Tangible Net Worth to be less than $2,000,000,000.
Section 8.02 Relationship of Total Outstanding Indebtedness to
Capitalization Value. At any time, Total Outstanding Indebtedness to exceed 50%
of Capitalization Value.
Section 8.03 Relationship of Combined EBITDA to Interest Expense.
For any calendar quarter, the ratio of (1) Combined EBITDA to (2) Interest
Expense (each for the twelve (12)-month period ending with such quarter), to be
less than 2.50 to 1.00.
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Section 8.04 Relationship of Combined EBITDA to Combined Debt
Service. For any calendar quarter, the ratio of (1) Combined EBITDA to (2)
Combined Debt Service (each for the twelve (12)-month period ending with such
quarter), to be less than 2.00 to 1.00.
Section 8.05 Relationship of Combined EBITDA to Total Outstanding
Indebtedness. For any calendar quarter, the ratio of (1) Combined EBITDA for the
twelve (12)-month period ending with such calendar quarter to (2) Total
Outstanding Indebtedness as of the end of such calendar quarter to be less than
15%. For purposes of this Section, Combined EBITDA shall be adjusted as follows:
in the case of properties acquired during such twelve (12)-month period, such
property's contribution to Combined EBITDA shall be annualized, and in the case
of properties disposed of during such twelve (12)-month period, such property's
contribution to Combined EBITDA shall be disregarded.
Section 8.06 Unsecured Debt Yield. For any calendar quarter,
Unsecured Debt Yield for the twelve (12)-month period ending with such calendar
quarter to be less than 13.5%. For purposes of this Section, Combined EBITDA
shall be adjusted as follows: in the case of properties acquired during such
twelve (12)-month period, such property's contribution to Combined EBITDA shall
be annualized, and in the case of properties disposed of during such twelve
(12)-month period, such property's contribution to Combined EBITDA shall be
disregarded.
Section 8.07 Relationship of Unencumbered Combined EBITDA to
Unsecured Interest Expense. For any calendar quarter, the ratio of (1)
Unencumbered Combined EBITDA to (2) Unsecured Interest Expense (each for such
calendar quarter), to be less than 1.75 to 1.00.
Section 8.08 Relationship of Dividends to Funds From Operations.
For any calendar year, dividends declared by Borrower to exceed 95% of Funds
From Operations, each for such calendar year.
Section 8.09 Relationship of Secured Indebtedness to Capitalization
Value. At any time, Secured Indebtedness to exceed 40% of Capitalization Value.
ARTICLE IX
EVENTS OF DEFAULT
Section 9.01 Events of Default. Any of the following events shall
be an "Event of Default":
(1) If Borrower shall: fail to pay the principal of any Notes as and
when due, and such failure to pay shall continue unremedied for five (5) days
after the due date of such amount; or fail to pay interest accruing on any Notes
as and when due, and such failure to pay shall continue unremedied for five (5)
days after written notice by Administrative Agent of such failure to pay; or
fail to make any payment required under Section 6.10 as and when due; or fail to
pay any fee or any other amount due under this Agreement, any other Loan
Document or the Supplemental Fee Letter as and when due and such failure to pay
shall continue unremedied for two (2) Banking Days after written notice by
Administrative Agent of such failure to pay; or
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(2) If any representation or warranty made by Borrower in this
Agreement or in any other Loan Document or which is contained in any
certificate, document, opinion, financial or other statement furnished at any
time under or in connection with a Loan Document shall prove to have been
incorrect in any material respect on or as of the date made; or
(3) If Borrower shall fail (a) to perform or observe any term,
covenant or agreement contained in Article VII or Article VIII; or (b) to
perform or observe any term, covenant or agreement contained in this Agreement
(other than obligations specifically referred to elsewhere in this Section 9.01)
or any Loan Document, or any other document executed by Borrower and delivered
to Administrative Agent or the Banks in connection with the transactions
contemplated hereby and such failure under this clause (b) shall remain
unremedied for thirty (30) consecutive calendar days after notice thereof (or
such shorter cure period as may be expressly prescribed in the applicable
document); provided, however, that if any such default under clause (b) above
cannot by its nature be cured within such thirty (30) day, or shorter, as the
case may be, grace period and so long as Borrower shall have commenced cure
within such thirty (30) day, or shorter, as the case may be, grace period and
shall, at all times thereafter, diligently prosecute the same to completion,
Borrower shall have an additional period, not to exceed sixty (60) days, to cure
such default; in no event, however, is the foregoing intended to effect an
extension of the Maturity Date; or
(4) If Borrower shall fail (a) to pay any Recourse Debt (other than
the payment obligations described in paragraph (1) of this Section) in any
amount, or any Debt (other than Recourse Debt) in an amount equal to or greater
than $50,000,000, in any such case when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise) after the expiration of
any applicable grace period, or (b) to perform or observe any material term,
covenant, or condition under any agreement or instrument relating to any such
Debt, when required to be performed or observed, if the effect of such failure
to perform or observe is to accelerate, or to permit the acceleration of, after
the giving of notice or the lapse of time, or both (other than in cases where,
in the judgment of the Required Banks, meaningful discussions likely to result
in (i) a waiver or cure of the failure to perform or observe, or (ii) otherwise
averting such acceleration are in progress between Borrower and the obligee of
such Debt), the maturity of such Debt, or any such Debt shall be declared to be
due and payable, or required to be prepaid (other than by a regularly scheduled
or otherwise required prepayment), prior to the stated maturity thereof; or
(5) If Borrower, or any Affiliate of Borrower to which $50,000,000 or
more of Capitalization Value is attributable, shall (a) generally not, or be
unable to, or shall admit in writing its inability to, pay its debts as such
debts become due; or (b) make an assignment for the benefit of creditors,
petition or apply to any tribunal for the appointment of a custodian, receiver
or trustee for it or a substantial part of its assets; or (c) commence any
proceeding under any bankruptcy, reorganization, arrangement, readjustment of
debt, dissolution or liquidation Law of any jurisdiction, whether now or
hereafter in effect; or (d) have had any such petition or application filed or
any such proceeding shall have been commenced, against it, in which an
adjudication or appointment is made or order for relief is entered, or which
petition, application or proceeding remains undismissed or unstayed for a period
of sixty (60) days or more; or (e) be the subject of any proceeding under which
all or a substantial part of its assets may be subject to seizure, forfeiture or
divestiture; or (f) by any act or omission indicate its consent to, approval of
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or acquiescence in any such petition, application or proceeding or order for
relief or the appointment of a custodian, receiver or trustee for all or any
substantial part of its property; or (g) suffer any such custodianship,
receivership or trusteeship for all or any substantial part of its property, to
continue undischarged for a period of sixty (60) days or more; or
(6) If one or more judgments, decrees or orders for the payment of
money in excess of $10,000,000 (excluding any such judgments, decrees or orders
which are fully covered by insurance) in the aggregate shall be rendered against
Borrower or any of its Material Affiliates, and any such judgments, decrees or
orders shall continue unsatisfied and in effect for a period of thirty (30)
consecutive days without being vacated, discharged, satisfied or stayed or
bonded pending appeal; or
(7) If any of the following events shall occur or exist with respect
to Borrower or any ERISA Affiliate: (a) any Prohibited Transaction involving any
Plan; (b) any Reportable Event with respect to any Plan; (c) the filing under
Section 4041 of ERISA of a notice of intent to terminate any Plan or the
termination of any Plan; (d) any event or circumstance which would constitute
grounds for the termination of, or for the appointment of a trustee to
administer, any Plan under Section 4042 of ERISA, or the institution by the PBGC
of proceedings for any such termination or appointment under Section 4042 of
ERISA; or (e) complete or partial withdrawal under Section 4201 or 4204 of ERISA
from a Multiemployer Plan or the reorganization, insolvency, or termination of
any Multiemployer Plan; and in each case above, if such event or conditions, if
any, could in the reasonable opinion of any Bank subject Borrower to any tax,
penalty, or other liability to a Plan, Multiemployer Plan, the PBGC or otherwise
(or any combination thereof) which in the aggregate exceeds or is likely to
exceed $50,000; or
(8) If at any time Borrower is not a qualified real estate investment
trust under Sections 856 through 860 of the Code or is not a publicly traded
company listed on the New York Stock Exchange; or
(9) If at any time any portion of Borrower's assets constitute plan
assets for ERISA purposes (within the meaning of C.F.R. Section 2510.3-101); or
(10) If, in the reasonable judgment of all of the Banks (and the
basis for such determination is provided to Borrower in writing in reasonable
detail), there shall occur a Material Adverse Change; or
(11) If there shall occur a change in the majority of the Board of
Directors of Borrower during any twelve (12)-month period; or
(12) If any Person (including Affiliates of such Person) shall
acquire more than 25% of the common shares of Borrower.
Section 9.02 Remedies. If any Event of Default shall occur and be
continuing, Administrative Agent shall, upon request of the Majority Banks, by
notice to Borrower, (1) declare the outstanding balance of the Notes, all
interest thereon, and all other amounts payable under this Agreement to be
forthwith due and payable, whereupon such balance, all such interest, and all
such amounts due under this Agreement and under any other Loan Document shall
become and be forthwith due and payable, without presentment, demand, protest,
or further
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notice of any kind, all of which are hereby expressly waived by Borrower; and/or
(2) exercise any remedies provided in any of the Loan Documents or by law.
Notwithstanding the foregoing, if an Event of Default under Section 9.01(10)
shall occur and be continuing, Administrative Agent shall not be entitled to
exercise the foregoing remedies until (1) it has received a written notice from
all of the Banks (the "Unanimous Bank Notices") (i) requesting Administrative
Agent exercise such remedies and (ii) indicating each Bank's conclusion in its
reasonable judgment that a Material Adverse Change has occurred and (2)
Administrative Agent has provided notice to Borrower, together with copies of
all of the Unanimous Bank Notices.
ARTICLE X
ADMINISTRATIVE AGENT; RELATIONS AMONG BANKS
Section 10.01 Appointment, Powers and Immunities of Administrative
Agent. Each Bank hereby irrevocably appoints and authorizes Administrative Agent
to act as its agent hereunder and under any other Loan Document with such powers
as are specifically delegated to Administrative Agent by the terms of this
Agreement and any other Loan Document, together with such other powers as are
reasonably incidental thereto. Administrative Agent shall have no duties or
responsibilities except those expressly set forth in this Agreement and any
other Loan Document or required by law, and shall not by reason of this
Agreement be a fiduciary or trustee for any Bank except to the extent that
Administrative Agent acts as an agent with respect to the receipt or payment of
funds (nor shall Administrative Agent have any fiduciary duty to Borrower nor
shall any Bank have any fiduciary duty to Borrower or to any other Bank). No
implied covenants, responsibilities, duties, obligations or liabilities shall be
read into this Agreement or otherwise exist against Administrative Agent.
Neither Administrative Agent nor any of its directors, officers, employees,
attorneys-in-fact or affiliates shall be responsible to the Banks for any
recitals, statements, representations or warranties made by Borrower or any
officer, partner or official of Borrower or any other Person contained in this
Agreement or any other Loan Document, or in any certificate or other document or
instrument referred to or provided for in, or received by any of them under,
this Agreement or any other Loan Document, or for the value, legality, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document or any other document or instrument referred to or
provided for herein or therein, for the perfection or priority of any Lien
securing the Obligations or for any failure by Borrower to perform any of its
obligations hereunder or thereunder. Administrative Agent may employ agents and
attorneys-in-fact and shall not be responsible, except as to money or securities
received by it or its authorized agents, for the negligence or misconduct of any
such agents or attorneys-in-fact selected by it with reasonable care. Neither
Administrative Agent nor any of its directors, officers, employees,
attorneys-in-fact, agents or affiliates shall be liable or responsible for any
action taken or omitted to be taken by it or them hereunder or under any other
Loan Document or in connection herewith or therewith, except for its or their
own gross negligence or willful misconduct. Borrower shall pay any fee agreed to
by Borrower and Administrative Agent with respect to Administrative Agent's
services hereunder.
Section 10.02 Reliance by Administrative Agent. Administrative Agent
shall be entitled to rely upon any certification, notice or other communication
(including any thereof by telephone, telex, telegram or cable) believed by it to
be genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons, and upon advice and statements
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of legal counsel, independent accountants and other experts selected by
Administrative Agent. Administrative Agent may deem and treat each Bank as the
holder of the Loan made by it for all purposes hereof and shall not be required
to deal with any Person who has acquired a participation in any Loan or
participation from a Bank. As to any matters not expressly provided for by this
Agreement or any other Loan Document, Administrative Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder in accordance
with instructions signed by the Required Banks, and such instructions of the
Required Banks and any action taken or failure to act pursuant thereto shall be
binding on all of the Banks and any other holder of all or any portion of any
Loan or participation.
Section 10.03 Defaults. Administrative Agent shall not be deemed to
have knowledge of the occurrence of a Default or Event of Default unless
Administrative Agent has received notice from a Bank or Borrower specifying such
Default or Event of Default and stating that such notice is a "Notice of
Default." In the event that Administrative Agent receives such a notice of the
occurrence of a Default or Event of Default, Administrative Agent shall give
prompt notice thereof to the Banks. Administrative Agent, following consultation
with the Banks, shall (subject to Section 10.07) take such action with respect
to such Default or Event of Default which is continuing as shall be directed by
the Majority Banks; provided that, unless and until Administrative Agent shall
have received such directions, Administrative Agent may take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interest of the Banks; and
provided further that Administrative Agent shall not send a notice of Default or
acceleration to Borrower without the approval of the Majority Banks. In no event
shall Administrative Agent be required to take any such action which it
determines to be contrary to Law or to the Loan Documents. Each of the Banks
acknowledges and agrees that no individual Bank may separately enforce or
exercise any of the provisions of any of the Loan Documents, including, without
limitation, the Notes, other than through Administrative Agent.
Section 10.04 Rights of Administrative Agent as a Bank. With respect
to its Loan Commitment and the Loan provided by it, Administrative Agent in its
capacity as a Bank hereunder shall have the same rights and powers hereunder as
any other Bank and may exercise the same as though it were not acting as
Administrative Agent, and the term "Bank" or "Banks" shall, unless the context
otherwise indicates, include Administrative Agent in its capacity as a Bank.
Administrative Agent and its Affiliates may (without having to account therefor
to any Bank) accept deposits from, lend money to (on a secured or unsecured
basis), and generally engage in any kind of banking, trust or other business
with Borrower (and any Affiliates of Borrower) as if it were not acting as
Administrative Agent.
Section 10.05 Indemnification of Administrative Agent. Each Bank
agrees to indemnify Administrative Agent (to the extent not reimbursed under
Section 12.04 or under the applicable provisions of any other Loan Document, but
without limiting the obligations of Borrower under Section 12.04 or such
provisions), for its Pro Rata Share of any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against Administrative Agent in any way relating to or
arising out of this Agreement, any other Loan Document or any other documents
contemplated by or referred to herein or the transactions contemplated hereby or
thereby (including, without limitation, the costs and
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expenses which Borrower is obligated to pay under Section 12.04) or under the
applicable provisions of any other Loan Document or the enforcement of any of
the terms hereof or thereof or of any such other documents or instruments;
provided that no Bank shall be liable for (1) any of the foregoing to the extent
they arise from the gross negligence or willful misconduct of the party to be
indemnified, (2) any loss of principal or interest with respect to
Administrative Agent's Loan or (3) any loss suffered by Administrative Agent in
connection with a swap or other interest rate hedging arrangement entered into
with Borrower.
Section 10.06 Non-Reliance on Administrative Agent and Other Banks.
Each Bank agrees that it has, independently and without reliance on
Administrative Agent or any other Bank, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of
Borrower and the decision to enter into this Agreement and that it will,
independently and without reliance upon Administrative Agent or any other Bank,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own analysis and decisions in taking or not taking
action under this Agreement or any other Loan Document. Administrative Agent
shall not be required to keep itself informed as to the performance or
observance by Borrower of this Agreement or any other Loan Document or any other
document referred to or provided for herein or therein or to inspect the
properties or books of Borrower. Except for notices, reports and other documents
and information expressly required to be furnished to the Banks by
Administrative Agent hereunder, Administrative Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the affairs, financial condition or business of Borrower (or any
Affiliate of Borrower) which may come into the possession of Administrative
Agent or any of its Affiliates. Administrative Agent shall not be required to
file this Agreement, any other Loan Document or any document or instrument
referred to herein or therein, for record or give notice of this Agreement, any
other Loan Document or any document or instrument referred to herein or therein,
to anyone.
Section 10.07 Failure of Administrative Agent to Act. Except for
action expressly required of Administrative Agent hereunder, Administrative
Agent shall in all cases be fully justified in failing or refusing to act
hereunder unless it shall have received further assurances (which may include
cash collateral) of the indemnification obligations of the Banks under Section
10.05 in respect of any and all liability and expense which may be incurred by
it by reason of taking or continuing to take any such action. If any indemnity
furnished by the Banks to Administrative Agent for any purpose shall, in the
reasonable opinion of Administrative Agent, be insufficient or become impaired,
Administrative Agent may call for additional indemnity and cease, or not
commence, to do the action indemnified against until such additional indemnity
is furnished.
Section 10.08 Resignation or Removal of Administrative Agent.
Administrative Agent hereby agrees not to unilaterally resign except in the
event it becomes an Affected Bank and is removed or replaced as a Bank pursuant
to Section 3.07, in which event it shall have the right to resign.
Administrative Agent may be removed at any time with cause by the Required
Banks, provided that Borrower and the other Banks shall be promptly notified
thereof. Upon any such removal, the Required Banks shall have the right to
appoint a successor Administrative Agent which successor Administrative Agent,
so long as it is reasonably acceptable to the Required Banks, shall be that Bank
then having the greatest Loan Commitment. If no successor
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Administrative Agent shall have been so appointed by the Required Banks and
shall have accepted such appointment within thirty (30) days after the Required
Banks' removal of the retiring Administrative Agent, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent, which shall be one of the Banks. The Required Banks or the
retiring Administrative Agent, as the case may be, shall upon the appointment of
a successor Administrative Agent promptly so notify Borrower and the other
Banks. Upon the acceptance of any appointment as Administrative Agent hereunder
by a successor Administrative Agent, such successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Administrative Agent, and the retiring Administrative
Agent shall be discharged from its duties and obligations hereunder. After any
retiring Administrative Agent's removal hereunder as Administrative Agent, the
provisions of this Article X shall continue in effect for its benefit in respect
of any actions taken or omitted to be taken by it while it was acting as
Administrative Agent.
Section 10.09 Amendments Concerning Agency Function. Notwithstanding
anything to the contrary contained herein, Administrative Agent shall not be
bound by any waiver, amendment, supplement or modification hereof or of any
other Loan Document which affects its duties, rights, and/or function hereunder
or thereunder unless it shall have given its prior written consent thereto.
Section 10.10 Liability of Administrative Agent. Administrative
Agent shall not have any liabilities or responsibilities to Borrower on account
of the failure of any Bank to perform its obligations hereunder or to any Bank
on account of the failure of Borrower to perform its obligations hereunder or
under any other Loan Document.
Section 10.11 Transfer of Agency Function. Without the consent of
Borrower or any Bank, Administrative Agent may at any time or from time to time
transfer its functions as Administrative Agent hereunder to any of its offices
wherever located in the United States, provided that Administrative Agent shall
promptly notify Borrower and the Banks thereof.
Section 10.12 Non-Receipt of Funds by Administrative Agent. (a)
Unless Administrative Agent shall have received notice from a Bank or Borrower
(either one as appropriate being the "Payor") prior to the date on which such
Bank is to make payment hereunder to Administrative Agent of the proceeds of a
Loan or Borrower is to make payment to Administrative Agent, as the case may be
(either such payment being a "Required Payment"), which notice shall be
effective upon receipt, that the Payor will not make the Required Payment in
full to Administrative Agent, Administrative Agent may assume that the Required
Payment has been made in full to Administrative Agent on such date, and
Administrative Agent in its sole discretion may, but shall not be obligated to,
in reliance upon such assumption, make the amount thereof available to the
intended recipient on such date. If and to the extent the Payor shall not have
in fact so made the Required Payment in full to Administrative Agent, the
recipient of such payment shall repay to Administrative Agent forthwith on
demand such amount made available to it together with interest thereon, for each
day from the date such amount was so made available by Administrative Agent
until the date Administrative Agent recovers such amount, at the customary rate
set by Administrative Agent for the correction of errors among Banks for three
(3) Banking Days and thereafter at the Base Rate.
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(b) If, after Administrative Agent has paid each Bank's share of any
payment received or applied by Administrative Agent in respect of the Loan, that
payment is rescinded or must otherwise be returned or paid over by
Administrative Agent, whether pursuant to any bankruptcy or insolvency law,
sharing of payments clause of any loan agreement or otherwise, such Bank shall,
at Administrative Agent's request, promptly return its share of such payment or
application to Administrative Agent, together with such Bank's proportionate
share of any interest or other amount required to be paid by Administrative
Agent with respect to such payment or application. In addition, if a court of
competent jurisdiction shall adjudge that any amount received and distributed by
Administrative Agent is to be repaid, each Person to whom any such distribution
shall have been made shall either repay to Administrative Agent its share of the
amount so adjudged to be repaid or shall pay over to the same in such manner and
to such Persons as shall be determined by such court.
Section 10.13 Withholding Taxes. Each Bank represents that it is
entitled to receive any payments to be made to it hereunder without the
withholding of any tax and will furnish to Administrative Agent such forms,
certifications, statements and other documents as Administrative Agent may
request from time to time to evidence such Bank's exemption from the withholding
of any tax imposed by any jurisdiction or to enable Administrative Agent or
Borrower to comply with any applicable Laws or regulations relating thereto.
Without limiting the effect of the foregoing, if any Bank is not created or
organized under the laws of the United States of America or any state thereof,
such Bank will furnish to Administrative Agent a United States Internal Revenue
Service Form 4224 in respect of all payments to be made to such Bank by Borrower
or Administrative Agent under this Agreement or any other Loan Document or a
United States Internal Revenue Service Form 1001 establishing such Bank's
complete exemption from United States withholding tax in respect of payments to
be made to such Bank by Borrower or Administrative Agent under this Agreement or
any other Loan Document, or such other forms, certifications, statements or
documents, duly executed and completed by such Bank as evidence of such Bank's
exemption from the withholding of U.S. tax with respect thereto. Administrative
Agent shall not be obligated to make any payments hereunder to such Bank in
respect of any Loan or participation or such Bank's Loan Commitment or
obligation to purchase participations until such Bank shall have furnished to
Administrative Agent the requested form, certification, statement or document.
Section 10.14 Minimum Commitment by Co-Agents. Subsequent to the
Closing Date and provided there exists no Event of Default, Fleet agrees to
maintain a Loan Commitment in an amount no less than $25,000,000. Fleet further
agrees to hold and not to participate or assign any of such amount other than an
assignment to a Federal Reserve Bank or to its Parent or a majority-owned
subsidiary. In addition, each of Morgan and UBS agrees that, in the event it
sells its individual Loan Commitment down to zero, it may be removed as a
Co-Agent and either Syndication Agent or Documentation Agent, as the case may
be, by the Required Banks.
Section 10.15 Pro Rata Treatment. Except to the extent otherwise
provided, (1) each advance of proceeds of the Ratable Loans shall be made by the
Banks; (2) each reduction of the amount of the Total Loan Commitment under
Section 2.10 shall be applied to the Loan Commitments of the Banks; and (3) each
payment of the fee accruing under paragraph (b) of Section 2.07 and clause (1)
of Section 2.16(f) shall be made for the account of the Banks, ratably according
to the amounts of their respective Loan Commitments.
Section 10.16 Sharing of Payments Among Banks. If a Bank shall
obtain payment of any principal of or interest on any Loan made by it through
the exercise of any right of setoff, banker's lien, counterclaim, or by any
other means (including direct payment), and such
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payment results in such Bank receiving a greater payment than it would have been
entitled to had such payment been paid directly to Administrative Agent for
disbursement to the Banks, then such Bank shall promptly purchase for cash from
the other Banks participations in the Loans made by the other Banks in such
amounts, and make such other adjustments from time to time as shall be equitable
to the end that all the Banks shall share ratably the benefit of such payment.
To such end the Banks shall make appropriate adjustments among themselves (by
the resale of participations sold or otherwise) if such payment is rescinded or
must otherwise be restored. Borrower agrees that any Bank so purchasing a
participation in the Loans made by other Banks may exercise all rights of
setoff, banker's lien, counterclaim or similar rights with respect to such
participation. Nothing contained herein shall require any Bank to exercise any
such right or shall affect the right of any Bank to exercise, and retain the
benefits of exercising, any such right with respect to any other indebtedness of
Borrower.
Section 10.17 Possession of Documents. Each Bank shall keep
possession of its own Ratable Loan Note and the Swing Lender shall keep
possession of its Swing Loan Note. Administrative Agent shall hold all the other
Loan Documents and related documents in its possession and maintain separate
records and accounts with respect thereto, and shall permit the Banks and their
representatives access at all reasonable times to inspect such Loan Documents,
related documents, records and accounts.
ARTICLE XI
NATURE OF OBLIGATIONS
Section 11.01 Absolute and Unconditional Obligations. Borrower
acknowledges and agrees that its obligations and liabilities under this
Agreement and under the other Loan Documents shall be absolute and unconditional
irrespective of (1) any lack of validity or enforceability of any of the
Obligations, any Loan Documents, or any agreement or instrument relating
thereto; (2) any change in the time, manner or place of payment of, or in any
other term in respect of, all or any of the Obligations, or any other amendment
or waiver of or consent to any departure from any Loan Documents or any other
documents or instruments executed in connection with or related to the
Obligations; (3) any exchange or release of any collateral, if any, or of any
other Person from all or any of the Obligations; or (4) any other circumstances
which might otherwise constitute a defense available to, or a discharge of,
Borrower or any other Person in respect of the Obligations.
The obligations and liabilities of Borrower under this Agreement and
other Loan Documents shall not be conditioned or contingent upon the pursuit by
any Bank or any other Person at any time of any right or remedy against Borrower
or any other Person which may be or become liable in respect of all or any part
of the Obligations or against any collateral or security or guarantee therefor
or right of setoff with respect thereto.
Section 11.02 Non-Recourse to Borrower's Principals. Notwithstanding
anything to the contrary contained herein, in any of the other Loan Documents,
or in any other instruments, certificates, documents or agreements executed in
connection with the Loans (all of the foregoing, for purposes of this Section,
hereinafter referred to, individually and collectively, as the "Relevant
Documents"), no recourse under or upon any Obligation, representation, warranty,
promise or other matter whatsoever shall be had against any of Borrower's
Principals and each Bank expressly waives and releases, on behalf of itself and
its successors and assigns,
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all right to assert any liability whatsoever under or with respect to the
Relevant Documents against, or to satisfy any claim or obligation arising
thereunder against, any of Borrower's Principals or out of any assets of
Borrower's Principals, provided, however, that nothing in this Section shall be
deemed to (1) release Borrower from any personal liability pursuant to, or from
any of its respective obligations under, the Relevant Documents, or from
personal liability for its fraudulent actions or fraudulent omissions; (2)
release any of Borrower's Principals from personal liability for its or his own
fraudulent actions or fraudulent omissions; (3) constitute a waiver of any
obligation evidenced or secured by, or contained in, the Relevant Documents or
affect in any way the validity or enforceability of the Relevant Documents; or
(4) limit the right of Administrative Agent and/or the Banks to proceed against
or realize upon any collateral hereafter given for the Loans or any and all of
the assets of Borrower (notwithstanding the fact that any or all of Borrower's
Principals have an ownership interest in Borrower and, thereby, an interest in
the assets of Borrower) or to name Borrower (or, to the extent that the same are
required by applicable law or are determined by a court to be necessary parties
in connection with an action or suit against Borrower or any collateral
hereafter given for the Loans, any of Borrower's Principals) as a party
defendant in, and to enforce against any collateral hereafter given for the
Loans and/or assets of Borrower any judgment obtained by Administrative Agent
and/or the Banks with respect to, any action or suit under the Relevant
Documents so long as no judgment shall be taken (except to the extent taking a
judgment is required by applicable law or determined by a court to be necessary
to preserve Administrative Agent's and/or Banks' rights against any collateral
hereafter given for the Loans or Borrower, but not otherwise) or shall be
enforced against Borrower's Principals or their assets.
ARTICLE XII
MISCELLANEOUS
Section 12.01 Binding Effect of Request for Advance. Borrower agrees
that, by its acceptance of any advance of proceeds of the Loans under this
Agreement, it shall be bound in all respects by the request for advance
submitted on its behalf in connection therewith with the same force and effect
as if Borrower had itself executed and submitted the request for advance and
whether or not the request for advance is executed and/or submitted by an
authorized person.
Section 12.02 Amendments and Waivers. No amendment or any material
waiver of any provision of this Agreement or any other Loan Document nor consent
to any material departure by Borrower therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Required Banks and, solely
for purposes of its acknowledgment thereof, Administrative Agent, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given, provided, however, that no amendment, waiver
or consent shall, unless in writing and signed by all the Banks do any of the
following: (1) reduce the principal of, or interest on, the Notes or any fees
due hereunder or any other amount due hereunder or under any Loan Document; (2)
postpone any date fixed for any payment of principal of, or interest on, the
Notes or any fees due hereunder or under any Loan Document; (3) change the
definition of Required Banks; (4) amend this Section or any other provision
requiring the consent of all the Banks; or (5) waive any default under paragraph
(5) of Section 9.01. Any advance of proceeds of the Loans made prior to or
without the fulfillment by Borrower of all of the conditions precedent thereto,
whether or not known to Administrative
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Agent and the Banks, shall not constitute a waiver of the requirement that all
conditions, including the non-performed conditions, shall be required with
respect to all future advances. No failure on the part of Administrative Agent
or any Bank to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof or preclude any other or further exercise thereof or
the exercise of any other right. The remedies herein provided are cumulative and
not exclusive of any remedies provided by law. All communications from
Administrative Agent to the Banks requesting the Banks' determination, consent,
approval or disapproval (i) shall be given in the form of a written notice to
each Bank, (ii) shall be accompanied by a description of the matter or thing as
to which such determination, approval, consent or disapproval is requested and
(iii) shall include Administrative Agent's recommended course of action or
determination in respect thereof. Each Bank shall reply promptly, but in any
event within ten (10) Banking Days (or five (5) Banking Days with respect to any
decision to accelerate or stop acceleration of the Loan) after receipt of the
request therefor by Administrative Agent (the "Bank Reply Period"). Unless a
Bank shall give written notice to Administrative Agent that it objects to the
recommendation or determination of Administrative Agent (together with a written
explanation of the reasons behind such objection) within the Bank Reply Period,
such Bank shall be deemed to have approved or consented to such recommendation
or determination.
Section 12.03 Usury. Anything herein to the contrary
notwithstanding, the obligations of Borrower under this Agreement and the Notes
shall be subject to the limitation that payments of interest shall not be
required to the extent that receipt thereof would be contrary to provisions of
law applicable to a Bank limiting rates of interest which may be charged or
collected by such Bank.
Section 12.04 Expenses; Indemnification. Borrower agrees to
reimburse Co-Agents and Administrative Agent on demand for all costs, expenses,
and charges (including, without limitation, all reasonable fees and charges of
engineers, appraisers and legal counsel) incurred by any of them in connection
with the Loans and to reimburse each of the Banks for reasonable legal costs,
expenses and charges incurred by each of the Banks in connection with the
performance or enforcement of this Agreement, the Notes, or any other Loan
Documents; provided, however, that Borrower is not responsible for costs,
expenses and charges incurred by the Bank Parties in connection with the
administration or syndication of the Loans (other than the fees required by the
Supplemental Fee Letter). Borrower agrees to indemnify Administrative Agent and
each Bank and their respective directors, officers, employees and agents from,
and hold each of them harmless against, any and all losses, liabilities, claims,
damages or expenses incurred by any of them arising out of or by reason of (x)
any claims by brokers due to acts or omissions by Borrower, or (y) any
investigation or litigation or other proceedings (including any threatened
investigation or litigation or other proceedings) relating to any actual or
proposed use by Borrower of the proceeds of the Loans, including without
limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation or litigation or other proceedings (but
excluding any such losses, liabilities, claims, damages or expenses incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified).
The obligations of Borrower under this Section shall survive the
repayment of all amounts due under or in connection with any of the Loan
Documents and the termination of the Loans.
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Section 12.05 Assignment; Participation. This Agreement shall be
binding upon, and shall inure to the benefit of, Borrower, Administrative Agent,
the Banks and their respective successors and permitted assigns. Borrower may
not assign or transfer its rights or obligations hereunder.
Any Bank may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in its Loan (the
"Participations"). In the event of any such grant by a Bank of a Participation
to a Participant, whether or not Borrower or Administrative Agent was given
notice, such Bank shall remain responsible for the performance of its
obligations hereunder, and Borrower and Administrative Agent shall continue to
deal solely and directly with such Bank in connection with such Bank's rights
and obligations hereunder. Any agreement pursuant to which any Bank may grant
such a participating interest shall provide that such Bank shall retain the sole
right and responsibility to enforce the obligations of Borrower hereunder and
under any other Loan Document including, without limitation, the right to
approve any amendment, modification or waiver of any provision of this Agreement
or any other Loan Document; provided that such participation agreement may
provide that such Bank will not agree to any modification, amendment or waiver
of this Agreement described in clause (1) through (5) of Section 12.02 without
the consent of the Participant.
Subject to the provisions of Section 10.14, any Bank may at any time
assign to any bank or other institution with the acknowledgment of
Administrative Agent and the consent of Co-Agents and, provided there exists no
Event of Default, Borrower, which consents shall not be unreasonably withheld or
delayed (such assignee, a "Consented Assignee"), or to one or more banks or
other institutions which are majority owned subsidiaries of a Bank or to the
Parent of a Bank (each Consented Assignee or subsidiary bank or institution, an
"Assignee") all, or a proportionate part of all, of its rights and obligations
under this Agreement and its Note, and such Assignee shall assume rights and
obligations, pursuant to an Assignment and Assumption Agreement executed by such
Assignee and the assigning Bank, provided that, in each case, after giving
effect to such assignment the Assignee's Loan Commitment, and, in the case of a
partial assignment, the assigning Bank's Loan Commitment, each will be equal to
or greater than $10,000,000, provided, further, however, that the assigning Bank
shall not be required to maintain a Loan Commitment in the minimum amount
aforesaid in the event it assigns all of its rights and obligations under this
Agreement and its Note. Notwithstanding the provisions of the immediately
preceding sentence, the consents of Co-Agents and Borrower shall not be required
in the case of assignments by any Bank provided that the Assignee thereunder (or
a guarantor of such Assignee's obligations under this Agreement) has a credit
rating of AA (or its equivalent) or better from a nationally recognized rating
agency, and provided, further, however, that assignments by the Co-Agents shall
remain subject to the provisions of Section 10.14. Upon (i) execution and
delivery of such instrument, (ii) payment by such Assignee to the Bank of an
amount equal to the purchase price agreed between the Bank and such Assignee and
(iii) payment by such Assignee to Administrative Agent of a fee, for
Administrative Agent's own account, in the amount of $2,500, such Assignee shall
be a Bank Party to this Agreement and shall have all the rights and obligations
of a Bank as set forth in such Assignment and Assumption Agreement, and the
assigning Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by any party shall be
required. Upon the consummation of any assignment pursuant to this paragraph,
substitute Ratable Loan Notes (and, if applicable, Swing Loan Notes) shall be
issued to the assigning Bank and Assignee by
57
<PAGE> 63
Borrower, in exchange for the return of the original Ratable Loan Note (and, if
applicable, Swing Loan Note). The obligations evidenced by such substitute notes
shall constitute "Obligations" for all purposes of this Agreement and the other
Loan Documents. In connection with Borrower's execution of substitute notes as
aforesaid, Borrower shall deliver to Administrative Agent evidence, satisfactory
to Administrative Agent, of all requisite corporate action to authorize
Borrower's execution and delivery of the substitute notes and any related
documents. If the Assignee is not incorporated under the laws of the United
States of America or a state thereof, it shall, prior to the first date on which
interest or fees are payable hereunder for its account, deliver to Borrower and
Administrative Agent certification as to exemption from deduction or withholding
of any United States federal income taxes in accordance with Section 10.13. Each
Assignee shall be deemed to have made the representations contained in, and
shall be bound by the provisions of, Section 10.13.
Any Bank may at any time assign all or any portion of its rights
under this Agreement and its Note to a Federal Reserve Bank. No such assignment
shall release the transferor Bank from its obligations hereunder.
Borrower recognizes that in connection with a Bank's selling of
Participations or making of assignments, any or all documentation, financial
statements, appraisals and other data, or copies thereof, relevant to Borrower
or the Loans may be exhibited to and retained by any such Participant or
assignee or prospective Participant or assignee. In connection with a Bank's
delivery of any financial statements and appraisals to any such Participant or
assignee or prospective Participant or assignee, such Bank shall also indicate
that the same are delivered on a confidential basis. Borrower agrees to provide
all assistance reasonably requested by a Bank to enable such Bank to sell
Participations or make assignments of its Loan as permitted by this Section.
Each Bank agrees to provide Borrower with notice of all Participations sold by
such Bank to other than its Affiliates.
Section 12.06 Documentation Satisfactory. All documentation required
from or to be submitted on behalf of Borrower in connection with this Agreement
and the documents relating hereto shall be subject to the prior approval of, and
be satisfactory in form and substance to, Administrative Agent, its counsel and,
where specifically provided herein, the Banks. In addition, the persons or
parties responsible for the execution and delivery of, and signatories to, all
of such documentation, shall be acceptable to, and subject to the approval of,
Administrative Agent and its counsel and the Banks.
Section 12.07 Notices. Unless the party to be notified otherwise
notifies the other party in writing as provided in this Section, and except as
otherwise provided in this Agreement, notices shall be given to Administrative
Agent by telephone, confirmed by writing, and to the Banks and to Borrower by
ordinary mail or overnight courier, receipt confirmed, addressed to such party
at its address on the signature page of this Agreement. Notices shall be
effective (1) if by telephone, at the time of such telephone conversation, (2)
if given by mail, three (3) days after mailing; and (3) if given by overnight
courier, upon receipt.
Section 12.08 Setoff. Borrower agrees that, in addition to (and
without limitation of) any right of setoff, bankers' lien or counterclaim a Bank
may otherwise have, each Bank shall be entitled, at its option, to offset
balances (general or special, time or demand, provisional or
58
<PAGE> 64
final) held by it for the account of Borrower at any of such Bank's offices, in
Dollars or in any other currency, against any amount payable by Borrower to such
Bank under this Agreement or such Bank's Note, or any other Loan Document which
is not paid when due (regardless of whether such balances are then due to
Borrower), in which case it shall promptly notify Borrower and Administrative
Agent thereof; provided that such Bank's failure to give such notice shall not
affect the validity thereof. Payments by Borrower hereunder or under the other
Loan Documents shall be made without setoff or counterclaim.
Section 12.09 Table of Contents; Headings. Any table of contents and
the headings and captions hereunder are for convenience only and shall not
affect the interpretation or construction of this Agreement.
Section 12.10 Severability. The provisions of this Agreement are
intended to be severable. If for any reason any provision of this Agreement
shall be held invalid or unenforceable in whole or in part in any jurisdiction,
such provision shall, as to such jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without in any manner affecting the validity
or enforceability thereof in any other jurisdiction or the remaining provisions
hereof in any jurisdiction.
Section 12.11 Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument, and any party hereto may execute this Agreement by signing any
such counterpart.
Section 12.12 Integration. The Loan Documents and Supplemental Fee
Letter set forth the entire agreement among the parties hereto relating to the
transactions contemplated thereby and supersede any prior oral or written
statements or agreements with respect to such transactions.
Section 12.13 Governing Law. This Agreement shall be governed by,
and interpreted and construed in accordance with, the laws of the State of New
York.
Section 12.14 Waivers. In connection with the obligations and
liabilities as aforesaid, Borrower hereby waives (1) promptness and diligence;
(2) notice of any actions taken by any Bank Party under this Agreement, any
other Loan Document or any other agreement or instrument relating thereto except
to the extent otherwise provided herein; (3) all other notices, demands and
protests, and all other formalities of every kind in connection with the
enforcement of the Obligations, the omission of or delay in which, but for the
provisions of this Section, might constitute grounds for relieving Borrower of
its obligations hereunder; (4) any requirement that any Bank Party protect,
secure, perfect or insure any Lien on any collateral or exhaust any right or
take any action against Borrower or any other Person or any collateral; (5) any
right or claim of right to cause a marshalling of the assets of Borrower; and
(6) all rights of subrogation or contribution, whether arising by contract or
operation of law (including, without limitation, any such right arising under
the Federal Bankruptcy Code) or otherwise by reason of payment by Borrower,
either jointly or severally, pursuant to this Agreement or other Loan Documents.
Section 12.15 Jurisdiction; Immunities. Borrower, Administrative
Agent and each Bank hereby irrevocably submit to the jurisdiction of any New
York State or United States
59
<PAGE> 65
Federal court sitting in New York City over any action or proceeding arising out
of or relating to this Agreement, the Notes or any other Loan Document.
Borrower, Administrative Agent, and each Bank irrevocably agree that all claims
in respect of such action or proceeding may be heard and determined in such New
York State or United States Federal court. Borrower, Administrative Agent, and
each Bank irrevocably consent to the service of any and all process in any such
action or proceeding by the mailing of copies of such process to Borrower,
Administrative Agent or each Bank, as the case may be, at the addresses
specified herein. Borrower, Administrative Agent and each Bank agree that a
final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Borrower, Administrative Agent and each Bank further waive any
objection to venue in the State of New York and any objection to an action or
proceeding in the State of New York on the basis of forum non conveniens.
Borrower, Administrative Agent and each Bank agree that any action or proceeding
brought against Borrower, Administrative Agent or any Bank, as the case may be,
shall be brought only in a New York State court sitting in New York City or a
United States Federal court sitting in New York City, to the extent permitted or
not expressly prohibited by applicable law.
Nothing in this Section shall affect the right of Borrower,
Administrative Agent or any Bank to serve legal process in any other manner
permitted by law.
To the extent that Borrower, Administrative Agent or any Bank have or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether from service or notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to itself
or its property, Borrower, Administrative Agent and each Bank hereby irrevocably
waive such immunity in respect of its obligations under this Agreement, the
Notes and any other Loan Document.
BORROWER, ADMINISTRATIVE AGENT AND EACH BANK WAIVE ANY RIGHT EACH
SUCH PARTY MAY HAVE TO JURY TRIAL IN CONNECTION WITH ANY SUIT, ACTION OR
PROCEEDING BROUGHT WITH RESPECT TO THIS AGREEMENT, THE NOTES OR THE LOANS.
Section 12.16 Designated Lender. Any Bank (other than a Bank who is
such solely because it is a Designated Lender) (each, a "Designating Lender")
may at any time designate one (1) Designated Lender to fund Bid Rate Loans on
behalf of such Designating Lender subject to the terms of this Section and the
provisions in Section 12.05 shall not apply to such designation. No Bank may
designate more than one (1) Designated Lender. The parties to each such
designation shall execute and deliver to Administrative Agent for its acceptance
a Designation Agreement. Upon such receipt of an appropriately completed
Designation Agreement executed by a Designating Lender and a designee
representing that it is a Designated Lender, Administrative Agent will accept
such Designation Agreement and give prompt notice thereto to Borrower,
whereupon, (i) from and after the "Effective Date" specified in the Designation
Agreement, the Designated Lender shall become a party to this Agreement with a
right to make Bid Rate Loans on behalf of its Designating Lender pursuant to
Section 2.02 after Borrower has accepted the Bid Rate Quote of the Designating
Lender and (ii) the Designated Lender shall not be required to make payments
with respect to any obligations in this Agreement except to the extent of excess
cash flow of such Designated Lender which is not otherwise
60
<PAGE> 66
required to repay obligations of such Designated Lender which are then due and
payable; provided, however, that regardless of such designation and assumption
by the Designated Lender, the Designating Lender shall be and remain obligated
to Borrower, Administrative Agent and the Banks for each and every of the
obligations of the Designating Lender and its related Designated Lender with
respect to this Agreement, including, without limitation, any indemnification
obligations under Section 10.05. Each Designating Lender shall serve as the
administrative agent of its Designated Lender and shall on behalf of, and to the
exclusion of, the Designated Lender: (i) receive any and all payments made for
the benefit of the Designated Lender and (ii) give and receive all
communications and notices and take all actions hereunder, including, without
limitation, votes, approvals, waivers and consents under or relating to this
Agreement and the other Loan Documents. Any such notice, communication, vote,
approval, waiver or consent shall be signed by the Designating Lender as
administrative agent for the Designated Lender and shall not be signed by the
Designated Lender on its own behalf, but shall be binding on the Designated
Lender to the same extent as if actually signed by the Designated Lender.
Borrower, Administrative Agent and the Banks may rely thereon without any
requirement that the Designated Lender sign or acknowledge the same. No
Designated Lender may assign or transfer all or any portion of its interest
hereunder or under any other Loan Document, other than assignments to the
Designating Lender which originally designated such Designated Lender.
Section 12.17 No Bankruptcy Proceedings. Each of Borrower, the Banks
and Administrative Agent hereby agrees that it will not institute against any
Designated Lender or join any other Person in instituting against any Designated
Lender any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding under any federal or state bankruptcy or similar law, for one (1)
year and one (1) day after the payment in full of the latest maturing commercial
paper note issued by such Designated Lender.
Section 12.18 Year 2000. Borrower represents, warrants and covenants
that Borrower has taken and shall take all action reasonably necessary to assure
that its data processing and information technology systems are capable of
effectively processing data and information, including dates on and after
January 1, 2000, and shall not cease to perform, or provide, or cause any
software and/or system which is material to its operations or any interface
therewith to provide, invalid or incorrect results as a result of date
functionality and/or data, or otherwise experience any material degradation of
performance or functionality arising from, relating to or including date
functionality and/or data which represents or references different centuries or
more than one century or leap years, and that all such systems shall be
reasonably effective and accurate in managing and manipulating data derived
from, involving or relating in any way to dates (including single century
formulas and multi-century or leap year formulas), and will not cause a material
abnormally ending scenario within such systems or in any software and/or system
with which such systems interface, or generate materially incorrect values or
invalid results involving such dates. At the request of Administrative Agent,
Borrower shall provide Administrative Agent with reasonably acceptable assurance
of Borrower's year 2000 capability.
61
<PAGE> 67
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
AVALON BAY COMMUNITIES, INC.
By: /S/ THOMAS J. SARGEANT [SEAL]
--------------------------
Name: Thomas J. Sargeant
Title: CFO
Address for Notices:
15 River Road
Suite 210
Wilton, CT 06897
Attention: Joanne M. Lockridge
Vice President - Finance
Telephone: (203) 761-6545
Telecopy: (203) 761-6560
UNION BANK OF SWITZERLAND
(New York Branch)
(as Co-Agent and Bank)
By: /S/ HOWARD MARGOLIS
---------------------------------
Name: Howard Margolis
Title: Vice President Real Estate Finance
By: /S/ JOSEPH M. BASSIL
---------------------------------
Name: Joseph M. Bassil
Title: Director
62
<PAGE> 68
Address for Notices and Applicable Lending Office:
Union Bank of Switzerland
299 Park Avenue
38th Floor
New York, New York 10171-0026
Attention: Xiomara Martez
Telephone: (212) 821-3872
Telecopy: (212) 821-4138
FLEET NATIONAL BANK (as Co-Agent, Bank and
Administrative Agent)
By: /S/ LISA SANDERS
---------------------------------
Name: Lisa Sanders
Title: Vice President
Address for Notices and Applicable Lending Office:
Fleet National Bank
One Landmark Square
12th Floor
P.O. Box 1454
Stamford, CT 06904
Attention: Ms. Lisa Sanders
Telephone: (203) 358-6278
Telecopy: (203) 358-2039
MORGAN GUARANTY TRUST COMPANY OF NEW YORK (as
Co-Agent and Bank)
By: /S/ TIMOTHY V. O'DONOVAN
---------------------------------
Name: Timothy V. O'Donovan
Title: Vice President
Address for Notices and Applicable Lending Office:
Morgan Guaranty Trust Company of New York
60 Wall Street, 22/F
New York, New York 10260
Attention: Timothy O'Donovan
Telephone: (212) 648-8111
Telecopy: (212) 648-5014
63
<PAGE> 69
AMSOUTH BANK
By: /S/ STEVEN R. CHESTER
---------------------------------
Name: Steven R. Chester
Title: Assistant Vice President
Applicable Lending Office and
Address for Notices:
AMSOUTH Bank
1900 5th Avenue North
P.O. Box 11007
Birmingham, AL 35203
Attention: Mr. Steven R. Chester
Telephone: (205) 326-4869
Telecopy: (205) 326-4075
64
<PAGE> 70
FIRST UNION NATIONAL BANK
By: /S/ JOHN A. SCHISSEL
---------------------------------
Name: John A. Schissel
Title: Director
Applicable Lending Office and
Address for Notices:
First Union National Bank
One First Union Center
301 South College Street
Real Estate Capital Markets - 6th Floor
Charlotte, NC 28288-0166
Attention: Mr. John Schissel
Telephone: (704) 383-1967
Telecopy: (704) 383-6205
65
<PAGE> 71
COMMERZBANK AKTIENGESELLSCHAFT
By: /S/ DOUGLAS P. TRAYNOR
---------------------------------
Name: Douglas P. Traynor
Title: Vice President
By: /S/ CHRISTINE H. FINKEL
---------------------------------
Name: Christine H. Finkel
Title: Assistant Vice President
Applicable Lending Office and :
Address for Notices:
Commerzbank Aktiengesellschaft
2 World Financial Center
New York, New York 10281
Attention: Mr. Douglas Traynor
Telephone: (212) 266-7569
Telecopy: (212) 266-7530
66
<PAGE> 72
DRESDNER BANK, AG, New York
Branch
By: /S/ JOHANNES BOECKMANN
---------------------------------
Name: Johannes Boeckman
Title: First Vice President
By: /S/ NEIL J. CRAWFORD
---------------------------------
Name: Neil J. Crawford
Title: Vice President
Applicable Lending Office and
Address for Notices:
Dresdner Bank AG, New York Branch
75 Wall Street
New York, NY 10005-2889
Attention: Mr. Neil Crawford
Telephone: (212) 429-2657
Telecopy: (212) 429-2781
67
<PAGE> 73
NATIONSBANK, N.A.
By /S/ CHERYL D. FITZGERALD
----------------------------
Name: Cheryl D. Fitzgerald
Title: Vice President
Applicable Lending Office
and Address for Notices:
NationsBank, N.A.
6610 Rockledge Drive
6/FL, MD2-600-06-14
Bethseda, MD 20817-1876
Attention: Mr. Mark Monte
Telephone: (301) 493-7188
Telecopy: (301) 493-2885
68
<PAGE> 74
THE SUMITOMO BANK, LIMITED
By /S/ YASVO MIYAZAWA
------------------------------
Name: Yasvo Miyazawa
Title: Joint General Manager
By
------------------------------
Name:
Title:
Applicable Lending Office
and Address for Notices:
The Sumitomo Bank, Limited
277 Park Avenue, 6th Floor
New York, NY 10172
Attention: Yasuo Miyazawa
Telephone: (212) 224-4016
Telecopy: (212) 224-4887
with a copy to:
The Sumitomo Bank, Limited
777 South Figueroa Street
Suite 2600
Los Angeles, CA 90017
Attention: Mickey Jannol
Telephone: (213) 955-0875
Telecopy: (213) 623-6832
69
<PAGE> 75
THE LONG TERM CREDIT BANK OF JAPAN
(LOS ANGELES AGENCY)
By /S/ BRIAN H. KELLEY
------------------------------
Name: Brian H. Kelley
Title: Deputy General Manager
Applicable Lending Office
and Address for Notices:
The Long Term Credit Bank of Japan
(Los Angeles Agency)
350 South Grande Avenue
Suite 3000
Los Angeles, CA 90071
Attention: Mr. Naoki Oshima
Telephone: (213) 629-6348
Telecopy: (213) 687-3921
70
<PAGE> 76
PNC BANK, NATIONAL ASSOCIATION
By /S/ ASHLEY J. SMITH
------------------------------
Name: Ashley J. Smith
Title: Assistant Vice President
Applicable Lending Office
and Address for Notices:
PNC Bank, National Association
One PNC Plaza
249 Fifth Avenue
Mail Stop P1-POPP-19-2
Pittsburgh, PA 15222-2707
Attention: Real Estate Banking
Telephone: (412) 762-8519
Telecopy: (412) 768-5754
with a copy to:
PNC Bank, National Association
1401 Eye Street N.W.
Suite 200
Washington, DC 20005
Attention: Ms. Ashley Smith
Telephone: (202) 393-2752
Telecopy: (202) 393-1545
71
<PAGE> 77
SUMMIT BANK
By /S/ AMY L. BROWN
------------------------------
Name: Amy L. Brown
Title: Regional Vice President
Applicable Lending Office
and Address for Notices:
Summit Bank
1800 Chapel Avenue West
Cherry Hill, NJ 08002
Attention: Ms. Amy Brown
Telephone: (609) 486-3678
Telecopy: (609) 486-3717
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<PAGE> 78
EXHIBIT A
---------
AUTHORIZATION LETTER
________ ___, 1998
Fleet National Bank
---------------------
---------------------
---------------------
Re: Revolving Loan Agreement dated as of ____________, 1998 (the
"Loan Agreement"; capitalized terms not otherwise defined
herein shall have the meanings ascribed to such terms in the
Loan Agreement) among us, as Borrower, the Banks named
therein, and you, as Administrative Agent for
said Banks ________
Gentlemen:
In connection with the captioned Loan Agreement, we hereby designate
any of the following persons to give to you instructions, including notices
required pursuant to the Loan Agreement, orally, by telephone or teleprocess, or
in writing:
[NAMES]
Instructions may be honored on the oral, telephonic, teleprocess or
written instructions of anyone purporting to be any one of the above designated
persons even if the instructions are for the benefit of the person delivering
them. We will furnish you with written confirmation of each such instruction
signed by any person designated above (including any telecopy which appears to
bear the signature of any person designated above) on the same day that the
instruction is provided to you, but your responsibility with respect to any
instruction shall not be affected by your failure to receive such confirmation
or by its contents.
A-1
<PAGE> 79
Without limiting the foregoing, we hereby unconditionally authorize
any one of the above-designated persons to execute and submit requests for
advances of proceeds of the Loans (including the Initial Advance) and notices of
Elections, Conversions and Continuations to you under the Loan Agreement with
the identical force and effect in all respects as if executed and submitted by
us.
You shall be fully protected in, and shall incur no liability to us
for, acting upon any instructions which you in good faith believe to have been
given by any person designated above, and in no event shall you be liable for
special, consequential or punitive damages. In addition, we agree to hold you
and your agents harmless from any and all liability, loss and expense arising
directly or indirectly out of instructions that we provide to you in connection
with the Loan Agreement except for liability, loss or expense occasioned by your
gross negligence or willful misconduct.
Upon notice to us, you may, at your option, refuse to execute any
instruction, or part thereof, without incurring any responsibility for any loss,
liability or expense arising out of such refusal if you in good faith believe
that the person delivering the instruction is not one of the persons designated
above or if the instruction is not accompanied by an authentication method that
we have agreed to in writing.
We will promptly notify you in writing of any change in the persons
designated above and, until you have actually received such written notice and
have had a reasonable opportunity to act upon it, you are authorized to act upon
instructions, even though the person delivering them may no longer be
authorized.
Very truly yours,
AVALON BAY COMMUNITIES, INC.
By
------------------------------
Name:
Title:
A-2
<PAGE> 80
EXHIBIT B
---------
RATABLE LOAN NOTE
$___________ New York, New York
__________, 199_
For value received, Avalon Bay Communities, Inc., a Maryland
corporation ("Borrower"), hereby promises to pay to the order of ___________ or
its successors or assigns (collectively, the "Bank"), at the principal office of
Fleet National Bank _______________ _______________________ ("Administrative
Agent") for the account of the Applicable Lending Office of the Bank, the
principal sum of ________ Dollars ($____________), or if less, the amount loaned
by the Bank under its Ratable Loan to Borrower pursuant to the Loan Agreement
(as defined below) and actually outstanding, in lawful money of the United
States and in immediately available funds, in accordance with the terms set
forth in the Loan Agreement. Borrower also promises to pay interest on the
unpaid principal balance hereof, for the period such balance is outstanding, in
like money, at said office for the account of said Applicable Lending Office, at
the time and at a rate per annum as provided in the Loan Agreement. Any amount
of principal hereof which is not paid when due, whether at stated maturity, by
acceleration, or otherwise, shall bear interest from the date when due until
said principal amount is paid in full, payable on demand, at the rate set forth
in the Loan Agreement.
The date and amount of each advance of the Ratable Loan made by the
Bank to Borrower under the Loan Agreement referred to below, and each payment of
said Ratable Loan, shall be recorded by the Bank on its books and, prior to any
transfer of this Note (or, at the discretion of the Bank, at any other time),
may be endorsed by the Bank on the schedule attached hereto and any continuation
thereof.
This Note is one of the Ratable Loan Notes referred to in the
Revolving Loan Agreement dated as of ________ __, 1998 (as the same may be
amended from time to time, the "Loan Agreement") among Borrower, the Banks named
therein (including the Bank) and Administrative Agent, as administrative agent
for the Banks. All of the terms, conditions and provisions of the Loan Agreement
are hereby incorporated by reference. All capitalized terms used herein and not
defined herein shall have the meanings given to them in the Loan Agreement.
The Loan Agreement contains, among other things, provisions for the
prepayment of and acceleration of this Note upon the happening of certain stated
events.
No recourse shall be had under this Note against Borrower's
Principals except as and to the extent set forth in Section 11.02 of the Loan
Agreement.
All parties to this Note, whether principal, surety, guarantor or
endorser, hereby waive presentment for payment, demand, protest, notice of
protest and notice of dishonor.
B-1
<PAGE> 81
This Note shall be governed by the Laws of the State of New York,
provided that, as to the maximum lawful rate of interest which may be charged or
collected, if the Laws applicable to the Bank permit it to charge or collect a
higher rate than the Laws of the State of New York, then such Law applicable to
the Bank shall apply to the Bank under this Note.
AVALON BAY COMMUNITIES, INC.
By [SEAL]
-----------------------------
Name:
Title:
B-2
<PAGE> 82
Amount Amount Balance
Date of Advance of Payment Outstanding Notation By
---- ---------- ---------- ----------- -----------
B-3
<PAGE> 83
EXHIBIT B-1
-----------
BID RATE LOAN NOTE
$400,000,000 New York, New York
__________, 199_
For value received, Avalon Bay Communities, Inc., a Maryland
corporation ("Borrower"), hereby promises to pay to the order of Fleet National
Bank ("Administrative Agent") or its successors or assigns for the account of
the respective Banks making Bid Rate Loans or their respective successors or
assigns (for the further account of their respective Applicable Lending
Offices), at the principal office of Administrative Agent located at
_____________________________________________________, the principal sum of Four
Hundred Million Dollars ($400,000,000), or if less, the amount loaned by one or
more of said Banks under their respective Bid Rate Loans to Borrower pursuant to
the Loan Agreement (as defined below) and actually outstanding, in lawful money
of the United States and in immediately available funds, in accordance with the
terms set forth in the Loan Agreement. Borrower also promises to pay interest on
the unpaid principal balance hereof, for the period such balance is outstanding,
in like money, at said office for the account of said Banks for the further
account of their respective Applicable Lending Offices, at the times and at the
rates per annum as provided in the Loan Agreement. Any amount of principal
hereof which is not paid when due, whether at stated maturity, by acceleration,
or otherwise, shall bear interest from the date when due until said principal
amount is paid in full, payable on demand, at the rate set forth in the Loan
Agreement.
The date and amount of each Bid Rate Loan to Borrower under the Loan
Agreement referred to below, the name of the Bank making the same, the interest
rate applicable thereto and the maturity date thereof (i.e., the end of the
Interest Period Applicable thereto) shall be recorded by Administrative Agent on
its records and may be endorsed by Administrative Agent on the schedule attached
hereto and any continuation thereof.
This Note is the Bid Rate Loan Note referred to in the Revolving
Loan Agreement dated as of ______________, 1998 (as the same may be amended from
time to time, the "Loan Agreement") among Borrower, the Banks named therein and
Administrative Agent, as administrative agent for the Banks. All of the terms,
conditions and provisions of the Loan Agreement are hereby incorporated by
reference. All capitalized terms used herein and not defined herein shall have
the meanings given to them in the Loan Agreement.
The Loan Agreement contains, among other things, provisions for the
prepayment of and acceleration of this Note upon the happening of certain stated
events.
No recourse shall be had under this Note against the Borrower's
Principals except as and to the extent set forth in Section 11.02 of the Loan
Agreement.
B-1-1
<PAGE> 84
All parties to this Note, whether principal, surety, guarantor or
endorser, hereby waive presentment for payment, demand, protest, notice of
protest and notice of dishonor.
This Note shall be governed by the laws of the State of New York,
provided that, as to the maximum lawful rate of interest which may be charged or
collected, if the laws applicable to a particular Bank permit it to charge or
collect a higher rate than the laws of the State of New York, then such law
applicable to such Bank shall apply to such Bank under this Note.
AVALON BAY COMMUNITIES, INC.
By [SEAL]
----------------------------
Name:
Title:
B-1-2
<PAGE> 85
Bid Maturity (i.e.,
Rate Date of Principal Interest Expiration of
Loan # Bank Advance Amount Rate Interest Period)
------ ---- ------- --------- -------- ----------------
B-1-3
<PAGE> 86
EXHIBIT B-2
-----------
SWING LOAN NOTE
New York, New York
__________, 199_
For value received, Avalon Bay Communities, Inc., a Maryland
corporation ("Borrower"), hereby promises to pay to the order of ___________ or
its successors or assigns (collectively, the "Bank"), at the principal office of
Fleet National Bank _______________ _______________________ ("Administrative
Agent") for the account of the Applicable Lending Office of the Bank, the
principal sum equal to the amount loaned by the Bank under its Swing Loan to
Borrower pursuant to the Loan Agreement (as defined below) and actually
outstanding, in lawful money of the United States and in immediately available
funds, in accordance with the terms set forth in the Loan Agreement. Borrower
also promises to pay interest on the unpaid principal balance hereof, for the
period such balance is outstanding, in like money, at said office for the
account of said Applicable Lending Office, at the time and at a rate per annum
as provided in the Loan Agreement. Any amount of principal hereof which is not
paid when due, whether at stated maturity, by acceleration, or otherwise, shall
bear interest from the date when due until said principal amount is paid in
full, payable on demand, at the rate set forth in the Loan Agreement.
The date and amount of each advance of the Swing Loan made by the
Bank to Borrower under the Loan Agreement referred to below, and each payment of
said Swing Loan, shall be recorded by the Bank on its books and, prior to any
transfer of this Note (or, at the discretion of the Bank, at any other time),
may be endorsed by the Bank on the schedule attached hereto and any continuation
thereof.
This Note is one of the Swing Loan Notes referred to in the
Revolving Loan Agreement dated as of ________ __, 1998 (as the same may be
amended from time to time, the "Loan Agreement") among Borrower, the Banks named
therein (including the Bank) and Administrative Agent, as administrative agent
for the Banks. All of the terms, conditions and provisions of the Loan Agreement
are hereby incorporated by reference. All capitalized terms used herein and not
defined herein shall have the meanings given to them in the Loan Agreement.
The Loan Agreement contains, among other things, provisions for the
prepayment of and acceleration of this Note upon the happening of certain stated
events.
No recourse shall be had under this Note against Borrower's
Principals except as and to the extent set forth in Section 11.02 of the Loan
Agreement.
All parties to this Note, whether principal, surety, guarantor or
endorser, hereby waive presentment for payment, demand, protest, notice of
protest and notice of dishonor.
B-2-1
<PAGE> 87
This Note shall be governed by the Laws of the State of New York,
provided that, as to the maximum lawful rate of interest which may be charged or
collected, if the Laws applicable to the Bank permit it to charge or collect a
higher rate than the Laws of the State of New York, then such Law applicable to
the Bank shall apply to the Bank under this Note.
AVALON BAY COMMUNITIES, INC.
By [SEAL]
-----------------------------
Name:
Title:
B-2-2
<PAGE> 88
Amount Amount Balance
Date of Advance of Payment Outstanding Notation By
---- ---------- ---------- ----------- -----------
B-2-3
<PAGE> 89
EXHIBIT C
---------
MATERIAL AFFILIATES
State of Borrower's % Principal
Name Formation Age Interest Business
---- --------- ------------ --------
C-1
<PAGE> 90
EXHIBIT D
---------
SOLVENCY CERTIFICATE
The person executing this certificate is the _______________ of
Avalon Bay Communities, Inc., a Maryland corporation ("Borrower"), and is
familiar with its properties, assets and businesses, and is duly authorized to
execute this certificate on behalf of Borrower pursuant to Section 4.01(7) of
the Revolving Loan Agreement dated the date hereof (the "Loan Agreement") among
Borrower, the banks party thereto (each a "Bank" and collectively, the "Banks")
and Fleet National Bank, as administrative agent for the Banks (in such
capacity, together with its successors in such capacity, "Administrative
Agent"). In executing this Certificate, such person is acting solely in his or
her capacity as the _________ of Borrower, and not in his or her individual
capacity. Unless otherwise defined herein, terms defined in the Loan Agreement
are used herein as therein defined.
The undersigned further certifies that he or she has carefully
reviewed the Loan Agreement and the other Loan Documents and the contents of
this Certificate and, in connection herewith, has made such investigation and
inquiries as he or she deems reasonably necessary and prudent therefor. The
undersigned further certifies that the financial information and assumptions
which underlie and form the basis for the representations made in this
Certificate were reasonable when made and were made in good faith and continue
to be reasonable as of the date hereof.
The undersigned understands that Administrative Agent, Co-Agents and
the Banks are relying on the truth and accuracy of this Certificate in
connection with the transactions contemplated by the Loan Agreement.
The undersigned certifies that Borrower is Solvent.
IN WITNESS WHEREOF, the undersigned has executed this Certificate on
________ ___, 1998.
------------------------------
Name:
D-1
<PAGE> 91
\ EXHIBIT E
---------
ASSIGNMENT AND ASSUMPTION AGREEMENT
ASSIGNMENT AND ASSUMPTION AGREEMENT dated as of __________, 199_,
among [INSERT NAME OF ASSIGNING BANK] ("Assignor"), [INSERT NAME OF ASSIGNEE]
("Assignee"), Avalon Bay Communities, Inc., a Maryland corporation ("Borrower")
and [INSERT NAME OF ADMINISTRATIVE AGENT], as administrative agent for the Banks
referred to below (in such capacity, together with its successors in such
capacity, the "Administrative Agent").
Preliminary Statement
---------------------
1. This Assignment and Assumption Agreement (this "Agreement")
relates to the Revolving Loan Agreement dated _____________, 1998 (as the same
may be amended from time to time, the "Loan Agreement") among Borrower, the
banks party thereto (each a "Bank" and, collectively, the "Banks") and the
Administrative Agent. All capitalized terms not otherwise defined herein shall
have the respective meanings set forth in the Loan Agreement.
2. Subject to the terms and conditions set forth in the Loan
Agreement, Assignor has made a Loan Commitment to Borrower in an aggregate
principal amount of ___________ Dollars ($____________) ("Assignor's Loan
Commitment").
3. The aggregate outstanding principal amount of Assignor's
Ratable Loan made pursuant to Assignor's Loan Commitment at commencement of
business on the date hereof is __________ Dollars ($__________). The aggregate
outstanding principal amount of Bid Rate Loans made by Assignor to Borrower at
the commencement of business on the date hereof is
______________________________ Dollars ($______________). [IF ASSIGNMENT IS BY
SWING LENDER, INDICATE AMOUNT OF SWING LOAN COMMITMENT AND OUTSTANDING
PRINCIPAL.]
4. Assignor desires to assign to Assignee (a) all of the rights
of Assignor under the Loan Agreement in respect of a portion of its (i) Ratable
Loan and Loan Commitment thereunder in an amount equal to __________ Dollars
($__________) and (ii) Bid Rate Loans in an amount equal to
______________________ Dollars ($__________________) [IF SWING LOAN IS TO BE
ASSIGNED, SO INDICATE] (collectively, the "Assigned Loan and Commitment"); and
Assignee desires to accept assignment of such rights and assume the
corresponding obligations from Assignor on such terms.
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. Assignment. Assignor hereby assigns and sells to Assignee
all of the rights of Assignor under the Loan Agreement in and to the Assigned
Loan and Commitment, and Assignee hereby accepts such assignment from Assignor
and assumes all of the obligations
E-1
<PAGE> 92
of Assignor under the Loan Agreement with respect to the Assigned Loan and
Commitment. Upon the execution and delivery hereof by Assignor, Assignee,
Borrower and the Administrative Agent and the payment of the amount specified in
Section 2 hereof required to be paid on the date hereof, (1) Assignee shall, as
of the commencement of business on the date hereof, succeed to the rights and
obligations of a Bank under the Loan Agreement with a Loan and a Loan Commitment
in amounts equal to the Assigned Loan and Commitment, and (2) the Loan and Loan
Commitment of Assignor shall, as of the commencement of business on the date
hereof, be reduced correspondingly and Assignor released from its obligations
under the Loan Agreement to the extent such obligations have been assumed by
Assignee. The assignment provided for herein shall be without recourse to
Assignor.
SECTION 2. Payments. As consideration for the assignment and sale
contemplated in Section 1 hereof, Assignee shall pay to Assignor on the date
hereof in immediately available funds an amount equal to __________ Dollars
($___________) [insert the amount of that portion of Assignor's Loan being
assigned]. It is understood that any fees paid to Assignor under the Loan
Agreement are for the account of Assignor. Each of Assignor and Assignee hereby
agrees that if it receives any amount under the Loan Agreement which is for the
account of the other party hereto, it shall receive the same for the account of
such other party to the extent of such other party's interest therein and shall
promptly pay the same to such other party.
SECTION 3. [Consent and Acknowledgment] Execution and Delivery of
Note. [This Agreement is conditioned upon the consent of Co-Agents and, provided
there exists no Event of Default of Borrower, and the acknowledgment by the
Administrative Agent pursuant to Section 12.05 of the Loan Agreement. The
execution of this Agreement by Co-Agents, Borrower and the Administrative Agent
is evidence of this consent and acknowledgment, respectively. ONLY NECESSARY IF
ASSIGNEE IS NOT A MAJORITY OWNED SUBSIDIARY OF A BANK OR OF THE PARENT OF A
BANK] Pursuant to Section 12.05 of the Loan Agreement, Borrower has agreed to
execute and deliver Ratable Loan Notes payable to the respective orders of
Assignee and Assignor to evidence the assignment and assumption provided for
herein.
SECTION 4. Non-Reliance on Assignor. Assignor makes no
representation or warranty in connection with, and shall have no responsibility
with respect to, the solvency, financial condition, or statements of Borrower or
any other party to any Loan Document, or the validity and enforceability of the
obligations of Borrower or any other party to a Loan Document in respect of the
Loan Agreement or any other Loan Document. Assignee acknowledges that it has,
independently and without reliance on Assignor, and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and will continue to be responsible for
making its own independent appraisal of the business, affairs and financial
condition of Borrower and the other parties to the Loan Documents.
SECTION 5. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
E-2
<PAGE> 93
SECTION 6. Counterparts. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
SECTION 7. Certain Representations and Agreements by Assignee.
Reference is made to Section 10.13 of the Loan Agreement. Assignee hereby
represents that it is entitled to receive any payments to be made to it under
the Loan Agreement or hereunder without the withholding of any tax and agrees to
furnish the evidence of such exemption as specified therein and otherwise to
comply with the provisions of said Section 10.13.
E-3
<PAGE> 94
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed and delivered by their duly authorized officers as of the date first
above written.
[NAME OF ASSIGNOR]
By
----------------------------
Name:
Title:
[NAME OF ASSIGNEE]
By
----------------------------
Name:
Title:
Applicable Lending Office:
Address for Notices:
[Assignee]
[Address]
Attention:
---------------
Telephone: (___) ________
Telecopy: (___) ________
AVALON BAY COMMUNITIES, INC.
By
----------------------------
Name:
Title:
FLEET NATIONAL BANK
(as Administrative Agent and Co-Agent)
By
----------------------------
Name:
Title:
E-4
<PAGE> 95
UNION BANK OF SWITZERLAND
(New York Branch)
(as Co-Agent)
By
----------------------------
Name:
Title:
By
----------------------------
Name:
Title:
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
(as Co-Agent)
By
----------------------------
Name:
Title:
E-5
<PAGE> 96
EXHIBIT F
---------
Designation Agreement
---------------------
Reference is made to that certain Revolving Loan Agreement dated as
of ____________, 1998 (as amended, supplemented or otherwise modified from time
to time, the "Loan Agreement") among Avalon Bay Communities, Inc., a Maryland
corporation, the banks parties thereto, and Fleet National Bank, as
administrative agent for said banks. Terms defined in the Loan Agreement not
otherwise defined herein are used herein with the same meaning.
[BANK] ("Designor") and ____________________, a ____________________
("Designee") agree as follows:
1. Designor hereby designates Designee, and Designee hereby
accepts such designation, to have a right to make Bid Rate Loans pursuant to
Section 2.02 of the Loan Agreement. Any assignment by Designor to Designee of
its rights to make a Bid Rate Loan pursuant to such Section shall be effective
at the time of the funding of such Bid Rate Loan and not before such time.
2. Except as set forth in Section 6 below, Designor makes no
representation or warranty and assumes no responsibility pursuant to this
Designation Agreement with respect to (a) any statements, warranties or
representations made in or in connection with any Loan Document or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of any Loan Document or any other instrument and document furnished pursuant
thereto and (b) the financial condition of Borrower or the performance or
observance by Borrower of any of its obligations under any Loan Document or any
other instrument or document furnished pursuant thereto.
3. Designee (a) confirms that it has received a copy of each
Loan Document, together with copies of such financial statements and other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Designation Agreement; (b) agrees that
it will independently and without reliance upon Administrative Agent, Designor
or any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under any Loan Document; (c) represents that it is a
Designated Lender; (d) appoints and authorizes Administrative Agent to take such
action as agent on its behalf and to exercise such powers and discretion under
any Loan Document as are delegated to Administrative Agent by the terms thereof,
together with such powers and discretion as are reasonably incidental thereto;
and (e) agrees that it will perform in accordance with their terms all of the
obligations which by the terms of any Loan Document are required to be performed
by it as a Bank.
4. Designee hereby appoints Designor as Designee's agent and
attorney-in-fact, and grants to Designor an irrevocable power of attorney, to
receive payments made for the benefit of Designee under the Loan Agreement, to
deliver and receive all communications and notices under the Loan Agreement and
other Loan Documents and to exercise on Designee's behalf all rights to vote and
to grant and make approvals, waivers, consents or amendments to or under the
Loan Agreement or other Loan Documents. Any document executed by Designor on
F-1
<PAGE> 97
Designee's behalf in connection with the Loan Agreement or other Loan Documents
shall be binding on Designee. Borrower, Administrative Agent and each of the
Banks may rely on and are beneficiaries of this Designation Agreement.
5. Following the execution of this Designation Agreement by
Designor and Designee, it will be delivered to Administrative Agent for
acceptance by Administrative Agent. The effective date for this Designation
Agreement (the "Effective Date") shall be the date of acceptance hereof by
Administrative Agent.
6. Designor unconditionally agrees to pay or reimburse Designee
and save Designee harmless against all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may be imposed or asserted by any of the
parties to the Loan Documents against Designee, in its capacity as such, in any
way relating to or arising out of this Agreement or any other Loan Documents or
any action taken or omitted by the Designee hereunder or thereunder, provided
that Designor shall not be liable for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements if the same results from Designee's gross negligence
or willful misconduct.
7. As of the Effective Date, Designee shall be a party to the
Loan Agreement with a right to make Bid Rate Loans as a Bank pursuant to Section
2.02 of the Loan Agreement and the rights and obligations of a Bank related
thereto; provided, however, that Designee shall not be required to make payments
with respect to such obligations except to the extent of excess cash flow of
such Designee which is not otherwise required to repay obligations of such
Designated Lender which are then due and payable. Notwithstanding the foregoing,
Designor, as administrative agent for Designee, shall be and remain obligated to
Borrower, Administrative Agent and the Banks for each and every of the
obligations of Designee and its Designor with respect to the Loan Agreement,
including, without limitation, any indemnification obligations under Section
10.05 of the Loan Agreement.
8. This Designation Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
9. This Designation Agreement may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
IN WITNESS WHEREOF, Designor and Designee have executed and
delivered this Designation Agreement as of the date first set forth above.
[DESIGNOR]
By
--------------------------
Name:
Title:
F-2
<PAGE> 98
[DESIGNEE]
By
--------------------------
Name:
Title:
Applicable Lending Office
and Address for Notices:
---------------------------
---------------------------
---------------------------
Attention:
---------------
Telephone: (___) ________
Telecopy: (___) ________
ACCEPTED AS OF THE ___ DAY OF
___________, 199__.
[ADMINISTRATIVE AGENT], as
Administrative Agent
By
--------------------------
Name:
Title:
By
--------------------------
Name:
Title:
F-3
<PAGE> 99
EXHIBIT G-1
-----------
BID RATE QUOTE REQUEST
[Date]
To: [ADMINISTRATIVE AGENT], as Administrative Agent (the "Administrative
Agent")
From: [Borrower]
Re: Revolving Loan Agreement (the "Loan Agreement") dated as of
_____________, 1998 among [Borrower], the Banks parties thereto and the
Administrative Agent
We hereby give notice pursuant to Section 2.02 of the Loan Agreement
that we request Bid Rate Quotes for the following proposed Bid Rate Loans:
Date of Borrowing:
-----------------------
Principal Amount* Interest Period**
---------------- ---------------
$
Such Bid Rate Quotes should offer a(n) [LIBOR Bid Margin] [Absolute
Bid Rate].
Terms used herein have the meanings assigned to them in the Loan
Agreement.
[BORROWER]
By
----------------------------------
Name:
Title:(1)
-------------------
* Subject to the minimum amount and other requirements set forth in
Section 2.02(a) of the Loan Agreement.
** Subject to the provisions regarding "Interest Period" in the Loan
Agreement.
G-1-1
<PAGE> 100
EXHIBIT G-2
-----------
INVITATION FOR BID RATE QUOTES
To: [Bank]
Re: Invitation for Bid Rate Quotes to [Borrower] ("Borrower")
Pursuant to Section 2.02 of the Revolving Loan Agreement dated as of
_____________, 1998 among Borrower, the Banks parties thereto and the
undersigned, as Administrative Agent, we are pleased on behalf of Borrower to
invite you to submit Bid Rate Quotes to Borrower for the following proposed Bid
Rate Loans:
Date of Borrowing: ________________________________
Principal Amount Interest Period
---------------- ---------------
$
Such Bid Rate Quotes should offer a(n) [LIBOR Bid Margin] [Absolute
Bid Rate].
Please respond to this invitation by no later than 2:00 P.M. (New
York time) on [date].
[ADMINISTRATIVE AGENT], as
Administrative Agent
By
------------------------------
Name:
Title:
By
------------------------------
Name:
Title:
G-2-1
<PAGE> 101
EXHIBIT G-3
-----------
BID RATE QUOTE
To: [ADMINISTRATIVE AGENT], as Administrative Agent
Re: Bid Rate Quote to [Borrower] ("Borrower") pursuant to the Revolving
Loan Agreement dated __________, 1998 among Borrower, the Banks
party thereto and Administrative Agent (the "Loan Agreement")
In response to your invitation on behalf of Borrower dated
_______________, 19__, we hereby make the following Bid Rate Quote on the
following terms:
1. Quoting Bank:
2. Person to contact at quoting Bank:
--------------------------------------------
*
3. Date of borrowing:
----------------------------
4. We hereby offer to make Bid Rate Loan(s) in the following principal
amounts, for the following Interest Periods and at the following rates:
<TABLE>
<CAPTION>
Principal Interest LIBOR Bid Absolute
Amount** Period*** Margin**** Bid Rate
-------- --------- ---------- --------
<S> <C>
$
$ 1
</TABLE>
[Provided, that the aggregate principal amount of Bid Rate Loans for which
the above offers may be accepted shall not exceed $____________.]
5. LIBOR Reserve Requirement, if any: _____________________.
6. Terms used herein have the meanings assigned to them in the Loan
Agreement.
-------------------
* As specified in the related Invitation for Bid Rate Quotes.
** Principal amount bid for each Interest Period may not exceed
principal amount requested. Specify aggregate limitation if the sum of the
individual offers exceeds the amount the Bank is willing to lend. Amounts of
bids are subject to the requirements of Section 2.02(c) of the Loan Agreement.
*** No more than three (3) bids are permitted for each Interest
Period.
**** Margin over or under the LIBOR Interest Rate determined for
the applicable Interest Period. Specify percentage (to the nearest 1/1,000
of 1%) and specify whether "PLUS" OR "MINUS".
G-3-1
<PAGE> 102
We understand and agree that the offer(s) set forth above, subject
to the satisfaction of the applicable conditions set forth in the Loan
Agreement, irrevocably obligates us to make the Bid Rate Loan(s) for which any
offer(s) are accepted, in whole or in part.
Very truly yours,
[NAME OF BANK]
Date: By:
------------------ -----------------------
Authorized Officer
G-3-2
<PAGE> 103
EXHIBIT G-4
-----------
ACCEPTANCE OF BID RATE QUOTE
To: [ADMINISTRATIVE AGENT], as Administrative Agent (the "Administrative
Agent")
From: [Borrower]
Re: Revolving Loan Agreement (the "Loan Agreement") dated as of _______,
1998 among [Borrower], the Banks parties thereto and
the Administrative Agent
We hereby accept the offers to make Bid Rate Loan(s) set forth in
the Bid Rate Quote(s) identified below:
Date of Bid Principal Interest LIBOR Bid Absolute
Bank Rate Quote Amount Period Margin Bid Rate
---- ----------- --------- -------- --------- --------
Very truly yours,
[BORROWER]
By:
-----------------------
Name:
Title:
G-4-1