UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8‑K
CURRENT REPORT PURSUANT TO
SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): November 25, 2014 (November 19, 2014)
Education Realty Trust, Inc.
Education Realty Operating Partnership, LP
(Exact Name of Registrant as Specified in Its Charter)
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Maryland | | 001-32417 | | 20-1352180 |
Delaware | | 333-199988-01 | | 20-1352332 |
(State or Other Jurisdiction of Incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) |
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999 South Shady Grove Road, Suite 600 Memphis, Tennessee | |
38120 |
(Address of Principal Executive Offices) | | (Zip Code) |
901-259-2500
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement.
Underwriting Agreement
On November 24, 2014, Education Realty Operating Partnership, LP (the “Operating Partnership”) completed the public offering of $250,000,000 aggregate principal amount of the Operating Partnership’s 4.60% Senior Notes due 2024 (the “Notes”), pursuant to an underwriting agreement, dated November 19, 2014 (the “Underwriting Agreement”), among Education Realty Trust, Inc. (the “Company”), the Operating Partnership and J.P. Morgan Securities, LLC, RBC Capital Markets LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and PNC Capital Markets LLC, as representatives of the several underwriters named therein (the “Underwriters”). The Notes are fully and unconditionally guaranteed by the Company.
The net proceeds of the offering of the Notes were approximately $247 million, after deducting the underwriting discount and offering expenses payable by the the Operating Partnership. The Operating Partnership intends to use the net proceeds from the offering to prepay approximately $69 million of mortgage debt (including approximately $3 million in prepayment penalties and other fees). The Operating Partnership expects to use the remaining net proceeds to pay down the outstanding balance of its unsecured revolving credit facility and for general corporate purposes.
The Underwriting Agreement contains customary representations, warranties and agreements by the Company and the Operating Partnership, customary conditions to closing, other obligations of the parties and termination provisions. Additionally, the Company has agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the “Securities Act”), or to contribute to payments the Underwriters may be required to make because of any of those liabilities.
The foregoing description is a summary of the Underwriting Agreement and does not purport to be a complete statement of the parties’ rights and obligations thereunder. The foregoing description is qualified in its entirety by reference to the full text of the Underwriting Agreement, a copy of which is attached as Exhibit 10.1 to this Current Report on Form 8-K and incorporated by reference herein.
The offering of the Notes was made pursuant to a shelf registration statement on Form S-3 (File Nos. 333-199988 and 333-199988-01)(the “Registration Statement”), which became effective upon filing with the Securities and Exchange Commission (the “SEC”) on November 7, 2014. A prospectus supplement, dated November 19, 2014, relating to the Notes and supplementing the Prospectus was filed with the SEC pursuant to Rule 424(b)(2) under the Securities Act. The legal opinions of Venable LLP and Morrison & Foerster LLP related to the offering of the Notes pursuant to the Registration Statement are filed as Exhibits 5.1 and 5.2, respectively, to this Current Report on Form 8-K.
First Supplemental Indenture
The Operating Partnership issued the Notes pursuant to an indenture, dated November 7, 2014 (the “Base Indenture”), as amended and supplemented with respect to the Notes by the first supplemental indenture, dated November 24, 2014 (the “First Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), in each case by and among the Operating Partnership, the Company, as guarantor, and U.S. Bank National Association, as trustee (the “Trustee”).
The Notes bear interest at a rate of 4.60% per year on the principal amount of the Notes, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on June 1, 2015. The Notes will mature on December 1, 2024.
The Indenture contains certain covenants that restrict the ability of the Company, the Operating Partnership and their subsidiaries to incur additional secured and unsecured indebtedness. The Operating Partnership may, from time to time, without notice to or the consent of the holders of the Notes, increase the principal amount of this series of Notes under the Indenture and issue such additional debt securities, in which case any additional debt securities so issued will have the same form and terms (other than the date of issuance and, under certain circumstances, the date from which interest thereon will begin to accrue), and will carry the same right to receive accrued and unpaid interest, as the Notes, and such additional debt securities will form a single series with the Notes.
The Operating Partnership, may, at its option, redeem the Notes, in whole at any time or in part from time to time, in each case prior to September 1, 2024 (three months prior to the stated maturity date of the Notes), at a redemption price equal to the greater of (1) 100% of the principal amount of the Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal of and interest on the Notes to be redeemed that would be due after the related redemption date but for such redemption (for the avoidance of doubt, exclusive of any unpaid interest accrued thereon to, but not including, such redemption date), discounted to such redemption date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as such term is defined in the Indenture) plus 35 basis points, plus in each case unpaid interest, if any, accrued to, but not including, such redemption date. In addition, at any time on or after September 1, 2024 (three months prior to the stated maturity date of the Notes), the Operating Partnership may, at its option, redeem the Notes, in whole at any time or in part (in authorized denominations) from time to time, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed plus unpaid interest, if any, accrued to, but not including, the related redemption date
A copy of the Base Indenture is incorporated herein by reference to the Company’s Current Report on Form 8-K dated November 7, 2014. A copy of the First Supplemental Indenture is attached as Exhibit 4.1, to this Current Report on Form 8-K and is incorporated herein by reference. The foregoing description is a summary of the Indenture and does not purport to be a complete statement of the parties’ rights and obligations thereunder. The foregoing description is qualified in its entirety by the terms of the Indenture. The Note and Guarantee are attached hereto as Exhibits 4.2 and 4.3, respectively.
Amended and Restated Credit Agreements
On November 19, 2014, the Operating Partnership (the "Borrower") entered into that certain fifth amended and restated credit agreement (the “Fifth Amended and Restated Credit Amendment”) with KeyBank, National Association, PNC Bank, National Association, Regions Bank, Royal Bank of Canada, Bank of America, N.A., U.S. Bank National Association, First Tennessee Bank, N.A., Metropolitan Bank, JPMorgan Chase Bank, N.A. and Fifth Third Bank, with KeyBank, National Association serving as administrative agent on behalf of itself and the lenders set forth in the Fifth Amended and Restated Credit Agreement. The Fifth Amended and Restated Credit Agreement amends and restates that certain Fourth Amended and Restated Credit Agreement, dated as of January 14, 2013 as amended on October 24, 2013 and as further amended on February 14, 2014 (the “Revolver”).
Additionally, on November 19, 2014, the Borrower entered into that certain first amended and restated credit agreement (the “First Amended and Restated Credit Agreement” and together with the “Fifth Amended and Restated Credit Agreement,” the “Amended and Restated Credit Agreements”) with PNC Bank National Association, Regions Bank, KeyBank National Association, U.S. Bank National Association and Fifth Third Bank, with PNC Bank National Association serving as administrative agent on behalf of itself and the lenders set forth in the First Amended and Restated Credit Agreement. The First Amended and Restated Credit Agreement amends and restates that certain Credit Agreement, dated January 13, 2014 and amended February 14, 2014 (the “Term Loan Facility”).
The Fifth Amended and Restated Credit Amendment amends and restates the Revolver and the First Amended and Restated Credit Agreement amends and restates the Term Loan Facility to, among other things:
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(i) | remove subsidiaries as borrowers and guarantors; |
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(ii) | provide for an accordion feature for the Revolver that allows for future expansion of the aggregate commitment by up to $500 million, which may be exercised prior to November 19, 2018, subject to certain conditions; |
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(iii) | reduce the applicable spread on the interest rate on all borrowings under the Revolver; |
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(iv) | remove certain unencumbered pool financial tests and other financial covenants, such as (a) variable rate indebtedness restriction, (b) maximum additional unsecured indebtedness and (c) maximum secured recourse indebtedness; |
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(v) | create unencumbered leverage ratio which requires unsecured debt to be less than 60% of the unencumbered asset value; |
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(vi) | create unencumbered debt service coverage ratio, which requires a 1.75x coverage of unencumbered net operating income to unsecured interest expense; |
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(vii) | reset of tangible net worth to $896,000,000; and |
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(viii) | remove individual limitations on the maximum permitted investment for (a) investments in unconsolidated affiliates, (b) investments in undeveloped land, (c) investments not related to the ownership, development, operation and management of collegiate housing communities and (d) investments in assets under development. The aggregate limitation of maximum permitted investments remained at 30% of total asset value. |
Additionally, the Fifth Amended and Restated Credit Agreement amends the maturity date of the Revolver from January 14, 2018 to November 19, 2018, with an additional one-year extension available, subject to certain conditions.
The foregoing description of the Amended and Restated Credit Agreements does not purport to be complete and is qualified in their entirety by the terms of the Fifth Amended and Restated Credit Agreement and the First Amended and Restated Credit Agreement, which are filed as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K and incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant
The information set forth in Item 1.01 is incorporated herein by reference.
Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
On November 19, 2014, the Board of Directors of the Company announced Mr. Paul O. Bower's resignation from his position as Chairman of the Board of Directors of the Company, effective December 31, 2014. The retirement of Mr. Bower is in accordance with the Company’s mandatory retirement policy and is not due to any disagreement with the Company.
Mr. Randall L. Churchey, the Company’s current President, Chief Executive Officer and a member of the Company’s Board of Directors, will replace Mr. Bower as Chairman of the Board of Directors on January 1, 2015. Mr. Thomas Trubiana, the Company’s Executive Vice President and Chief Investment Officer, has been appointed as a member of the Board of Directors and will replace Mr. Churchey as president of the Company effective January 1, 2015.
As an executive officer of the Company, Mr. Trubiana is not entitled to compensation as a director. As previously disclosed in a Current Report on Form 8-K filed by the Company on January 2, 2013, Mr. Trubiana is subject to an Amended and Restated Employment Agreement with the Company related to his employment as Chief Investment Officer of the Company. There were no arrangements or understandings between Mr. Trubiana and any other person pursuant to which Mr. Trubiana was appointed a director of the Company. The Company anticipates amending the terms of Mr. Trubiana's employment agreement effective January 1, 2015.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On November 25, 2014, the Company filed with the Maryland State Department of Assessments and Taxation of Maryland two Articles of Amendment (the “Amendments”) to the Company’s Articles of Amendment and Restatement, as amended, that: (i) provided for a 1-for-3 reverse stock split of the issued and outstanding shares of common stock of the Company, resulting in a par value of $0.03 for each resulting share (the "Common Stock"), effective at 8:01 a.m. Eastern time on December 1, 2014, and (ii) provided for the par value of the Common Stock to be reduced from $0.03 per share back to $0.01 per share, effective at 8:01 a.m. Eastern Time on December 1, 2014.
The foregoing description of the Amendments does not purport to be complete and is qualified in its entirety by reference to the copies of the Amendments, copies of which are filed as Exhibit 3.1 and Exhibit 3.2 to this Current Report on Form 8-K and are incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit No. | | Description |
1.1 | | Underwriting Agreement dated November 19, 2014 among Education Realty Trust, Inc., Education Realty Operating Partnership, LP, J.P. Morgan Securities, LLC, RBC Capital Markets, LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and PNC Capital Markets LLC. |
3.1 | | Articles of Amendment. |
3.2 | | Articles of Amendment. |
4.1 | | First Supplemental Indenture. |
4.2 | | Note. |
4.3 | | Guarantee. |
5.1 | | Opinion of Venable LLP. |
5.2 | | Opinion of Morrison & Foerster LLP. |
8.1 | | Opinion of Morrison & Foerster LLP regarding tax matters. |
10.1 | | Fifth Amended and Restated Credit Agreement among Education Realty Operating Partnership, LP and certain of its subsidiaries, each of which is an indirectly owned subsidiary of Education Realty Trust, Inc. KeyBank, National Association, as Administrative Agent (the “Agent”), Regions Bank, PNC Bank, National Association and Royal Bank of Canada, as Documentation Agents, and KeyBanc Capital Markets, PNC Capital Markets LLC, RBC Capital Markets and Regions Capital Markets, as Co-Bookrunners and Co-Lead Arrangers. |
10.2 | | First Amended and Restated Credit Agreement among Education Realty Operating Partnership, LP and certain of its subsidiaries, each of which is an indirectly owned subsidiary of Education Realty Trust, Inc., PNC Bank National Association, Regions Bank, KeyBank National Association, U.S. Bank National Association and Fifth Third Bank. |
23.1 | | Consent of Venable LLP (included in Exhibit 5.1). |
23.2 | | Consent of Morrison & Foerster LLP (included in Exhibit 5.2). |
23.3 | | Consent of Morrison & Foerster LLP (included in Exhibit 8.1). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| EDUCATION REALTY TRUST, INC. |
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Date: November 25, 2014 | By: | /s/ Edwin B. Brewer, Jr. |
| | Edwin B. Brewer, Jr. Executive Vice President and Chief Financial Officer |
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| EDUCATION REALTY OPERATING PARTNERSHIP, LP |
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| By: EDUCATION REALTY OP GP, INC., its general partner |
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| | By: /s/ Edwin B. Brewer, Jr. |
| | Edwin B. Brewer, Jr. Executive Vice President and Chief Financial Officer |
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INDEX TO EXHIBITS
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Exhibit No. | | Description |
1.1 | | Underwriting Agreement dated November 19, 2014 among Education Realty Trust, Inc., Education Realty Operating Partnership, LP, J.P. Morgan Securities, LLC, RBC Capital Markets, LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and PNC Capital Markets LLC. |
3.1 | | Articles of Amendment. |
3.2 | | Articles of Amendment. |
4.1 | | First Supplemental Indenture. |
4.2 | | Note. |
4.3 | | Guarantee. |
5.1 | | Opinion of Venable LLP. |
5.2 | | Opinion of Morrison & Foerster LLP. |
8.1 | | Opinion of Morrison & Foerster LLP regarding tax matters. |
10.1 | | Fifth Amended and Restated Credit Agreement among Education Realty Operating Partnership, LP and certain of its subsidiaries, each of which is an indirectly owned subsidiary of Education Realty Trust, Inc. KeyBank, National Association, as Administrative Agent (the “Agent”), Regions Bank, PNC Bank, National Association and Royal Bank of Canada, as Documentation Agents, and KeyBanc Capital Markets, PNC Capital Markets LLC, RBC Capital Markets and Regions Capital Markets, as Co-Bookrunners and Co-Lead Arrangers. |
10.2 | | First Amended and Restated Credit Agreement among Education Realty Operating Partnership, LP and certain of its subsidiaries, each of which is an indirectly owned subsidiary of Education Realty Trust, Inc., PNC Bank National Association, Regions Bank, KeyBank National Association, U.S. Bank National Association and Fifth Third Bank. |
23.1 | | Consent of Venable LLP (included in Exhibit 5.1). |
23.2 | | Consent of Morrison & Foerster LLP (included in Exhibit 5.2). |
23.3 | | Consent of Morrison & Foerster LLP (included in Exhibit 8.1). |
EXHIBIT 1.1
Education Realty Operating Partnership, LP
4.600% Senior Notes due 2024
Fully and Unconditionally Guaranteed by
Education Realty Trust, Inc.
UNDERWRITING AGREEMENT
November 19, 2014
J.P. Morgan Securities LLC
RBC Capital Markets, LLC
Merrill Lynch, Pierce, Fenner & Smith
Incorporated and
PNC Capital Markets LLC
as Representatives of the several Underwriters
c/o J.P. Morgan Securities LLC
383 Madison Avenue
New York, New York 10179
Ladies and Gentlemen:
Education Realty Operating Partnership, LP, a Delaware limited partnership (the “Operating Partnership”), proposes to issue and sell to the several underwriters named in Schedule I hereto (the “Underwriters”), for whom you (the “Representatives”) are acting as representatives, $250,000,000 aggregate principal amount of the Operating Partnership’s 4.600% Senior Notes due 2024 (the “Notes”). The Notes will be fully and unconditionally guaranteed as to payment of the principal thereof and premium, if any, and interest thereon (the “Guarantee,” and together with the Notes, the “Securities”) by Education Realty Trust, Inc., a Maryland corporation (the “Company,” and together with the Operating Partnership, the “Transaction Entities”). The Securities will be issued pursuant to an indenture, dated as of November 7, 2014, as amended and supplemented by the First Supplemental Indenture, to be dated as of November 24, 2014 (together, the “Indenture”) among the Operating Partnership, as issuer, the Company, as guarantor, and U.S. Bank National Association, as trustee (the “Trustee”). To the extent there are no additional Underwriters listed on Schedule I other than you, the term Representatives as used herein shall mean you, as Underwriters, and the terms Representatives and Underwriters shall mean either the singular or plural as the context requires.
The Transaction Entities have filed with the Securities and Exchange Commission (the “Commission”) an automatic shelf registration statement on Form S–3 (No. 333–199988 and 333–199988 -01), including the related base prospectus dated November 7, 2014 (including the
documents incorporated or deemed to be incorporated by reference therein prior to the time of the execution of this Agreement pursuant to Item 12 of Form S-3 under the 1933 Act (as defined below), the “Base Prospectus”), covering the registration of various securities (including the Securities) under the Securities Act of 1933, as amended (the “1933 Act”), and the offer and sale thereof from time to time in accordance with Rule 415 of the rules and regulations of the Commission under the 1933 Act (the “1933 Act Regulations”). Such registration statement became effective upon filing under Rule 462(e) of the 1933 Act Regulations. Promptly after execution and delivery of this Agreement, the Transaction Entities will prepare and file a final prospectus supplement relating to the Securities in accordance with the provisions of Rule 430B of the 1933 Act Regulations (“Rule 430B”) and paragraph (b) of Rule 424 of the 1933 Act Regulations (“Rule 424(b)”). Any information included in such prospectus supplement that was omitted from such registration statement at the time it became effective but that is deemed to be part of, and included in, such registration statement pursuant to Rule 430B is referred to herein as “Rule 430B Information.” The Base Prospectus and prospectus supplement filed pursuant to Rule 424(b) used in connection with the offering of the Securities that omitted Rule 430B Information, including the documents incorporated or deemed to be incorporated by reference therein prior to the time of the execution of this Agreement pursuant to Item 12 of Form S-3 under the 1933 Act, is referred to herein collectively as a “preliminary prospectus.” Such registration statement, at any given time, including any amendments thereto to such time, the exhibits and any schedules thereto at such time, the documents incorporated or deemed incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933 Act at such time and the documents otherwise deemed to be a part thereof or included therein by the 1933 Act Regulations (including, without limitation, any 430B Information), is herein referred to as the “Registration Statement”; provided, however, that the term “Registration Statement” without reference to a time means the Registration Statement as of the time of the first contract of sale for the Securities, which time shall be considered the “new effective date” of the Registration Statement with respect to the Underwriters and the Securities (within the meaning of Rule 430B(f)(2)). The Base Prospectus and the final prospectus supplement, in the form first filed pursuant to Rule 424(b) in connection with the offering of the Securities, including the documents incorporated or deemed incorporated by reference therein prior to the time of the execution of this Agreement pursuant to Item 12 of Form S-3 under the 1933 Act, are referred to herein collectively as the “Prospectus.” For purposes of this Agreement, all references to the Registration Statement, any preliminary prospectus or the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system or any successor system thereto (collectively, “EDGAR”).
All references in this Agreement to financial statements and schedules and other information which is “contained,” “included” or “stated” in the Registration Statement, any preliminary prospectus, the Prospectus or the General Disclosure Package (as defined herein) (or other references of like import) shall be deemed to include all such financial statements and schedules and other information which are or are deemed to be incorporated by reference in, or otherwise deemed by 1933 Act Regulations to be a part of, or included in, the Registration Statement, any preliminary prospectus, the Prospectus or the General Disclosure Package, as the case may be, prior to the time of the execution of this Agreement; and all references in this Agreement to amendments or supplements to the Registration Statement, any preliminary prospectus, the Prospectus or the General Disclosure Package shall be deemed to include the filing of any document under the
Securities Exchange Act of 1934, as amended (the “1934 Act”), which is or is deemed to be incorporated by reference in, or otherwise deemed by the 1933 Act Regulations to be a part of, or included in, the Registration Statement, such preliminary prospectus, the Prospectus or the General Disclosure Package, as the case may be.
1. Representations and Warranties. The Transaction Entities, jointly and severally, represent and warrant to, and agree with, each Underwriter as of the date hereof, as of the Applicable Time (as defined below) and as of the Closing Date (as defined below) as follows:
(a) Each Transaction Entity meets the requirements for use of Form S-3 under the 1933 Act. The Registration Statement became effective upon filing with the Commission under Rule 462(e) under the 1933 Act and no stop order suspending the effectiveness of the Registration Statement or any part thereof has been issued under the 1933 Act and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the Transaction Entities, are contemplated by the Commission or the securities authority of any jurisdiction. No order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued and no proceeding for that purpose has been instituted or, to the knowledge of the Transaction Entities, threatened or contemplated by the Commission or the securities authority of any jurisdiction. Any request on the part of the Commission for additional information has been complied with.
Any offer that was a written communication relating to the Securities made prior to the filing of the Registration Statement by the Company or any person acting on its behalf (within the meaning, for this paragraph only, of Rule 163(c) of the 1933 Act Regulations) has been filed with the Commission in accordance with the exemption provided by Rule 163 of the 1933 Act Regulations (“Rule 163”) and otherwise complied with the requirements of Rule 163, including, without limitation, the legending requirement, to qualify such offer for the exemption from Section 5(c) of the 1933 Act provided by Rule 163.
At the respective times the Registration Statement and any post-effective amendments thereto became effective, at each deemed effective date with respect to the Underwriters and the Securities pursuant to Rule 430B(f)(2), and at the Closing Date, the Registration Statement and any amendments and supplements thereto complied, complies and will comply in all material respects with the requirements of the 1933 Act, the 1933 Act Regulations and the Trust Indenture Act of 1939, as amended (the “1939 Act”), and did not, does not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading. Neither the Prospectus nor any amendments or supplements thereto, at the time the Prospectus or any such amendment or supplement was issued, or at the Closing Date, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
The preliminary prospectus and the Prospectus complied as to form when so filed in all material respects with the 1933 Act and the 1933 Act Regulations and any such preliminary prospectus and the Prospectus delivered or made available to the Underwriters
for use in connection with the offering of Securities was and will, at the time of such delivery, be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
As of the Applicable Time, each Issuer Free Writing Prospectus (as defined below) identified on Schedule II and the Statutory Prospectus (as defined below), all considered together (collectively, the “General Disclosure Package”), did not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
The representations and warranties in the preceding three paragraphs shall not apply to statements in or omissions from the Registration Statement, or any post-effective amendment thereto, or the Prospectus or the General Disclosure Package, or any amendments or supplements thereto, made in reliance upon and in conformity with information furnished to the Transaction Entities in writing by the Representatives on behalf of the Underwriters expressly for use therein (that information being limited to that described in the last sentence of Section 8(b) hereof).
As used in this subsection and elsewhere in this Agreement:
“Applicable Time” means 1:29 p.m. (New York City time) on November 19, 2014 or such other time as agreed by the Transaction Entities and the Underwriters.
“Issuer Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433 of the 1933 Act Regulations (“Rule 433”), relating to the Securities (including any identified on Schedule II hereto) that (i) is required to be filed with the Commission by either Transaction Entity, or (ii) is a “road show that is a written communication” within the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the Commission, or (iii) is exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Securities or of the offering that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the records of the Transaction Entities pursuant to Rule 433(g).
“Statutory Prospectus” as of any time means the Base Prospectus that is included in the Registration Statement and the preliminary prospectus supplement relating to the Securities distributed to the Underwriters most recently prior to that time, including the documents incorporated or deemed incorporated by reference therein at such time pursuant to Item 12 of Form S-3 under the 1933 Act.
(b) (A) At the time of filing of the Registration Statement, (B) at the time of the most recent amendment thereto for the purposes of complying with Section 10(a)(3) of the 1933 Act (whether such amendment was by post-effective amendment, incorporated report filed pursuant to Section 13 or 15(d) of the 1934 Act or form of prospectus), (C) at the time either Transaction Entity or any person acting on its behalf (within the meaning, for this
clause only, of Rule 163(c) of the 1933 Act Regulations) made any offer relating to the Securities in reliance on the exemption of Rule 163 of the 1933 Act Regulations, and (D) as of the Applicable Time, the Company was and is a “well-known seasoned issuer” (as defined in Rule 405 of the 1933 Act Regulations (“Rule 405”)). The Registration Statement is an “automatic shelf registration statement,” as defined in Rule 405, and the offers and sales of the Securities have been and remain eligible for registration by the Company on such automatic shelf registration statement. The Company has not received from the Commission any notice pursuant to Rule 401(g)(2) of the 1933 Act Regulations (“Rule 401(g)(2)”) objecting to the use of the automatic shelf registration statement form.
(c) The documents incorporated or deemed to be incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, at the time they were or hereafter are filed with the Commission, complied and will comply in all material respects with the requirements of the 1934 Act and the rules and regulations of the Commission thereunder (the “1934 Act Regulations”), as applicable, and, when read together with the other information in the Registration Statement, the General Disclosure Package or the Prospectus, as the case may be, (i) at the time the Registration Statement became effective, (ii) at the earlier of the time the Prospectus was first used and the date and time of the first contract of sale of the Securities and (iii) at the Closing Date, did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.
(d) (i) at the original effectiveness of the Registration Statement, (ii) at the earliest time after the original effectiveness of the Registration Statement that either Transaction Entity or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) of the 1933 Act Regulations) of the Securities and (iii) as of the execution of this Agreement (with such time of execution being used as the determination date for purposes of this clause (iii)), neither Transaction Entity was or is an “ineligible issuer,” as defined in Rule 405, without taking account of any determination by the Commission pursuant to Rule 405 that it is not necessary that such Transaction Entity be considered an ineligible issuer.
(e) Each Issuer Free Writing Prospectus, as of its issue date and at all subsequent times through the completion of the public offer and sale of the Securities or until any earlier date that the Transaction Entities notified or notifies the Underwriters as described in Section 5(c) hereof, did not, does not and will not include any information that conflicted, conflicts or will conflict with the information contained in the Registration Statement, the General Disclosure Package or the Prospectus, including any document incorporated or deemed incorporated by reference therein and any preliminary or other prospectus deemed to be a part thereof that has not been superseded or modified. The foregoing sentence does not apply to statements in or omissions from any such Issuer Free Writing Prospectus based upon and in conformity with information furnished to the Transaction Entities in writing by the Representatives on behalf of the Underwriters expressly for use therein (that information being limited to that described in the last sentence of Section 8(b) hereof).
(f) The Operating Partnership has been duly formed and is validly existing as a limited partnership in good standing under the laws of the State of Delaware, is duly qualified to do business and is in good standing as a foreign limited partnership in each jurisdiction in which its ownership or lease of property or the operation of its properties or the conduct of its business requires such qualification, except where the failure to so qualify would not have, or reasonably be expected to have, individually or in the aggregate, a material adverse effect on the condition (financial or otherwise), business, earnings, properties, assets or prospects of the Transaction Entities and the Subsidiaries (as defined in Section 1(h) hereof) taken as a whole (a “Material Adverse Effect”), and has full power and authority necessary to own or lease, as the case may be, its properties and to operate its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement, the Indenture and the Notes.
(g) The Company is a corporation duly formed and validly existing and in good standing under the laws of the State of Maryland, with full corporate power and authority to own or lease, as the case may be, its properties and to operate its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement, the Indenture and the Guarantee; and the Company is duly qualified to do business as a foreign corporation and is in good standing in all other jurisdictions in which its ownership or lease of property or the operation of its properties or the conduct of its business requires such qualification, except where the failure to so qualify would not have, or reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
(h) Each direct or indirect subsidiary of the Company other than the Operating Partnership (each, a “Subsidiary” and collectively, the “Subsidiaries”), has been duly formed and is validly existing as a corporation, limited partnership or limited liability company, as the case may be, in good standing under the laws of the jurisdiction of its organization, with full power and authority (corporate and other) to own, lease and operate its properties and conduct its business as described in the Registration Statement, the General Disclosure Package and the Prospectus, except where the failure to be in good standing would not have, or be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect, and is duly qualified to do business as a foreign corporation, partnership or limited liability company in good standing in all other jurisdictions in which its ownership, lease or operation of property or the conduct of its business requires such qualification, except where the failure to so qualify would not have, or be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect; each majority owned and active Subsidiary is set forth on Schedule IV hereto; all of the issued and outstanding capital stock or other ownership interests of each Subsidiary have been duly authorized and validly issued and are fully paid and nonassessable and were offered in compliance with all applicable laws (including, without limitation, federal and state securities laws) in all material respects; the Company is the sole owner of Education Realty OP GP, Inc., which is the sole general partner of the Operating Partnership, and Education Realty OP GP, Inc., Education Realty OP Limited Partner Trust, Allen & O’Hara, Inc., Place Properties, L.P., and certain current and
former officers and a director of the Company collectively own a percentage interest in the Operating Partnership and the Company is the sole owner of University Towers OP GP, LLC, which is the sole general partner of the University Towers Partnership, and University Towers OP GP, LLC, the Operating Partnership, Allen & O’Hara, Inc. and a former officer and a current director of the Company and an unaffiliated individual collectively own a percentage interest in the University Towers Partnership; except as described in the preceding clause, each Subsidiary’s capital stock or other ownership interests are currently owned and will, immediately following the Closing Date, continue to be owned by the Company, directly or through subsidiaries, free and clear of any security interests, liens, mortgages, encumbrances, pledges, claims or other defects of any kind (collectively, “Liens”), except where such Liens would not have, or reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. None of such equity interests were issued in violation of the preemptive or other similar rights of any securityholder of such Subsidiary. Except as described in the Registration Statement, the General Disclosure Package and the Prospectus, there are no outstanding options, rights (preemptive or otherwise) or warrants to purchase or subscribe for equity interests or other securities of any Subsidiary. Each of the following Subsidiaries is a “significant subsidiary” of the Transaction Entities (as such term is defined in Rule 1-02 of Regulation S-X under the 1933 Act Regulations) (each, a “Significant Subsidiary” and collectively, the “Significant Subsidiaries”): EdR Development LLC, EdR Management Inc. and Education Realty OP Limited Partnership Trust; the aforementioned Subsidiaries are the only Significant Subsidiaries of the Transaction Entities.
(i) The Operating Partnership has an authorized capitalization as set forth in the Operating Partnership’s consolidated balance sheet as of the latest financial statements, audited or unaudited, as applicable, included or incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus.
(j) The outstanding shares of capital stock of the Company have been duly and validly authorized and are validly issued, fully paid and nonassessable and will have been offered and sold in compliance with all applicable laws (including, without limitation, federal and state securities laws) in all material respects.
(k) The outstanding units of limited partnership in the Operating Partnership (“OP Units”) have been duly authorized for issuance by the Operating Partnership, and are validly issued. The OP Units have been offered, issued and sold in compliance with all applicable laws (including, without limitation, federal and state securities laws) in all material respects.
(l) The Indenture has been duly qualified under the 1939 Act. The Indenture has been duly authorized, executed and delivered by each Transaction Entity and constitutes a valid and legally binding agreement of each Transaction Entity, enforceable against each Transaction Entity in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws relating to creditors’ rights or by general principles of equity.
(m) The Notes, when issued, will be in the form contemplated by the Indenture, and, at the Closing Date, will have been duly authorized for issuance and sale pursuant to this Agreement and the Indenture and duly executed by the Operating Partnership, and, when authenticated in the manner provided for in the Indenture and paid for by the Underwriters in accordance with the terms of this Agreement, will constitute valid and legally binding obligations of the Operating Partnership, enforceable against the Operating Partnership in accordance with their terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other similar laws relating to creditors’ rights or by general principles of equity, and will be entitled to the benefits of the Indenture.
(n) The Guarantee is in the form contemplated by the Indenture, has been duly authorized, executed and delivered by the Company and, when the Notes are paid for by the Underwriters in accordance with the terms of this Agreement, will constitute the valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar laws relating to creditors’ rights or by general principles of equity.
(o) The Securities and the Indenture conform in all material respects to the descriptions thereof contained in the Registration Statement, the General Disclosure Package and the Prospectus.
(p) Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there are no contracts, agreements or understandings between either Transaction Entity and any person that would give rise to a valid claim against either Transaction Entity or any Underwriter for a brokerage commission, finder’s fee or other like payment in connection with the offering of the Securities.
(q) Neither of the Transaction Entities nor the Subsidiaries (i) is in violation of its charter, declaration of trust, by-laws, certificate of formation, operating agreement or partnership agreement or similar organizational or governing documents, (ii) is in default (whether with or without the giving of notice or passage of time or both) in the performance or observance of any obligation, agreement, term, covenant or condition contained in a contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease, ground lease, development agreement, reciprocal easement agreement, deed restriction, utility agreement, management agreement or other agreement or instrument to which it is a party or by which it is bound, or to which any of the Properties (as hereinafter defined) or any of its other property or assets is subject (collectively, “Agreements and Instruments”), or (iii) is in violation of any statute, law, ordinance, rule, regulation, judgment, order or decree of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority to which it or the Properties or assets is subject, except, in the case of clauses (ii) and (iii), for such defaults or violations that would not have, or reasonably be expected to have, a Material Adverse Effect.
(r) No consent, approval, authorization, filing with or order of any court or governmental agency or body is required to be made or obtained by either Transaction Entity
or the Subsidiaries in connection with the execution, delivery and performance of this Agreement, the Indenture and the Securities or the consummation of the transactions contemplated hereby or thereby, except such consents, approvals, authorizations, filings or orders as have already been obtained or will be obtained under the 1933 Act or as required under state securities laws or the rules of the Financial Industry Regulatory Authority (“FINRA”).
(s) The execution, delivery and performance of this Agreement, the Indenture and the Securities by the Transaction Entities and consummation of the transactions contemplated hereby or thereby do not and will not (whether with or without the giving of notice or passage of time or both) conflict with or result in a breach or violation of any of the terms and provisions of, or constitute a default (or give rise to any right of termination, acceleration, cancellation, repurchase or redemption) or Repayment Event (as hereinafter defined) under, or result in the creation or imposition of a Lien (other than those described in the Registration Statement, the General Disclosure Package and the Prospectus) upon any of the properties or assets of any of the Transaction Entities or the Subsidiaries pursuant to, (i) any statute, law, rule, ordinance, regulation, judgment, order or decree of any court, domestic or foreign, regulatory body, administrative agency, governmental body, arbitrator or other authority, domestic or foreign, having jurisdiction over any of the Transaction Entities or the Subsidiaries or any of their properties or assets, (ii) any term, condition or provision of any Agreements or Instruments, or (iii) the charter, declaration of trust, by-laws, certificate of formation, operating agreement or partnership agreement or similar organizational or governing documents, as applicable, of any of the Transaction Entities or the Subsidiaries, except, in the case of clauses (i) and (ii), for such conflicts, breaches, defaults, violations, rights, Repayment Events or Liens that are disclosed in the Registration Statement, the General Disclosure Package and the Prospectus or as would not have, or reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. The Operating Partnership and the Company have full power and authority to authorize, issue and sell their respective Securities as contemplated by this Agreement. As used herein, “Repayment Event” means any event or condition which, without regard to compliance with any notice or other procedural requirements, gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by any of the Transaction Entities or the Subsidiaries.
(t) This Agreement has been duly and validly authorized, executed and delivered by each Transaction Entity, and the Amended and Restated Agreement of Limited Partnership of the Operating Partnership, dated as of January 31, 2005 (the “Operating Partnership Agreement”), has been duly and validly authorized, executed and delivered by the Transaction Entities and, to the knowledge of the Transaction Entities, by each of the other parties thereto. Each of this Agreement and the Operating Partnership Agreement, assuming due authorization, execution and delivery by the parties thereto (other than the Transaction Entities), is a valid and legally binding agreement of each Transaction Entity, enforceable against each Transaction Entity in accordance with its terms, except to the extent that such enforceability may be limited by applicable bankruptcy, insolvency, reorganization,
or other similar laws relating to creditors’ rights and general principles of equity and except as rights to indemnify and contribution thereunder may be limited by applicable law or policies underlying such law.
(u) The Transaction Entities and the Subsidiaries possess all certificates, licenses, consents, approvals, permits and other authorizations (“Licenses”) issued by appropriate governmental agencies or bodies or third parties necessary to conduct the business now operated by them or proposed to be operated by them (as described in the Registration Statement, the General Disclosure Package and the Prospectus), are in compliance with the terms and conditions of all such Licenses, and have not received any notice of proceedings relating to the revocation or modification of any such Licenses except where the failure to possess any such License or to comply with any of its terms and conditions, or an adverse determination in any proceeding, would not individually or in the aggregate have, or reasonably be expected to have, a Material Adverse Effect.
(v) The consolidated financial statements of the Operating Partnership and of the Company and their respective subsidiaries included or incorporated or deemed incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly in all material respects the consolidated financial position of the Operating Partnership and of the Company at the dates indicated and the consolidated statements of operations, changes in owners’ equity and cash flows of the Operating Partnership and of the Company for the periods specified; and said financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto and subject to normal year-end adjustments in the case of any unaudited interim financial statements) and have been prepared in all material respects on a consistent basis with the books and records of the Operating Partnership and the Company. The supporting schedules included or incorporated or deemed incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus present fairly in all material respects in accordance with GAAP the information required to be stated therein as of the dates indicated. The historical summaries of revenue and certain operating expenses of properties and the financial statements of unconsolidated joint venture affiliates included or incorporated or deemed incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus present fairly in all material respects the revenues and operating expenses included in such summaries or financial statements, as applicable, for the periods specified in conformity with GAAP and otherwise have been prepared in accordance with the applicable financial statement requirements. The selected financial data and the summary financial information included or incorporated or deemed incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus present fairly in all material respects the information shown therein and have been compiled on a basis consistent with that of the financial statements included or incorporated or deemed incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus. The pro forma financial statements and the related notes thereto included in or incorporated by reference in the Registration Statement, the General Disclosure
Package and the Prospectus present fairly the information shown therein, have been prepared in accordance with the Commission’s rules and guidelines with respect to pro forma financial statements and have been properly compiled on the bases described therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein. No other historical or pro forma financial statements (or schedules) are required by the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations to be included or incorporated or deemed incorporated by reference in the Registration Statement or the Prospectus. All disclosures contained in the Registration Statement, the General Disclosure Package or the Prospectus, if any, of any “non-GAAP financial measures” (as such term is defined by the rules and regulations of the Commission) comply in all material respects with Regulation G under the 1934 Act and Item 10 of Regulation S-K of the 1933 Act Regulations, to the extent applicable. The interactive data in eXtensible Business Reporting Language incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.
(w) Deloitte & Touche LLP, who certified the financial statements included or incorporated or deemed to be incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus and delivered the initial letter referred to in Sections 6(g) hereof, are independent registered certified public accountants as required by the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act Regulations.
(x) There are no transfer taxes or other similar fees or charges under federal law or the laws of any state, or any political subdivision thereof, required to be paid in connection with the execution and delivery of this Agreement or the issuance or sale by the Operating Partnership or the Company of their respective Securities.
(y) The Company, beginning with its taxable year ended December 31, 2007 and through its taxable year ended December 31, 2013 has been organized and operated in conformity with the requirements for qualification and taxation as a real estate investment trust (a “REIT”) under the Internal Revenue Code 1986, as amended (the “Code”), and the current and proposed method of operation of the Company, as described in the Registration Statement, the General Disclosure Package and the Prospectus, will permit the Company to continue to meet the requirements for qualification and taxation as a REIT under the Code for the taxable year ending December 31, 2014 and thereafter for so long as the Board of Directors of the Company deems it in the best interests of the Company’s stockholders to remain so qualified for taxation as a REIT under the Code.
(z) Each of the Transaction Entities and the Subsidiaries has filed all foreign, federal, state and local tax returns that are required to be filed or has requested extensions thereof, in each case, to the extent material (“Returns”) (except in any case in which the failure so to file would not have a Material Adverse Effect), whether or not arising from transactions in the ordinary course of business, except as described in the Registration Statement, the General Disclosure Package and the Prospectus, and has paid all taxes
required to be paid by it and any other assessment, fine or penalty levied against it, to the extent that any of the foregoing is due and payable, except for any such assessment, fine or penalty that is currently being contested in good faith or as would not have a Material Adverse Effect, whether or not arising from transactions in the ordinary course of business, except as described in the Registration Statement, the General Disclosure Package and the Prospectus. No audits or other administrative proceedings or court proceedings are presently pending against any of the Transaction Entities or the Subsidiaries with regard to any Returns, and no taxing authority has notified any of the Transaction Entities or the Subsidiaries in writing that it intends to investigate its tax affairs, except where any such audit or investigation, would not have, or would not reasonably be expected to have, a Material Adverse Effect.
(aa) Each of the Transaction Entities and the Subsidiaries has complied in all material respects with the provisions of the Code relating to the payment and withholding of taxes, including, without limitation, the withholding and reporting requirements under Sections 1441 through 1446, 3401 through 3406, and 6041 and 6049 of the Code, as well as similar provisions under any other laws, and has, within the time and in the manner prescribed by law, withheld and paid over to the proper governmental authorities all material amounts required in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder, or other third party, except in any case in which the failure so to comply would not have a Material Adverse Effect.
(bb) Neither of the Transaction Entities nor the Subsidiaries (including any predecessor entities) has distributed, or prior to the later of the Closing Date and the completion of the distribution of the Securities, will distribute, any offering material in connection with the offering or sale of the Securities other than the Registration Statement, the General Disclosure Package and the Prospectus and any other written materials consented to by the Representatives pursuant to Section 5(g) hereof) (it being understood that no representation is made with respect to any other materials distributed by the Representatives).
(cc) Each of the Transaction Entities and the Subsidiaries is in compliance, in all material respects, with all presently applicable provisions of the Employee Retirement Income Security Act of 1974, as amended, including the regulations and published interpretations thereunder (“ERISA”); no “reportable event” (as defined in ERISA) has occurred with respect to any “pension plan” (as defined in ERISA) for which either Transaction Entity would have any liability; neither of the Transaction Entities nor the Subsidiaries has incurred or expects to incur liability under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any “pension plan” or (ii) Sections 412 or 4971 of the Code, including the regulations and published interpretations thereunder; and each “pension plan” for which any of the Transaction Entities or the Subsidiaries would have any liability and that is intended to be qualified under Section 401(a) of the Code is so qualified in all material respects, and nothing has occurred, whether by action or by failure to act, which would cause the loss of such qualification, except where the failure to be so qualified would not have, or reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
(dd) The assets of the Transaction Entities and the Subsidiaries do not constitute “plan assets” of an ERISA regulated employee benefit plan.
(ee) (1) Each of the Transaction Entities and the Subsidiaries has fee simple title or a valid leasehold interest to all of the properties and other assets described in the Prospectus as owned or leased by the Transaction Entities or the Subsidiaries (the “Properties”), in each case, free and clear of all Liens, except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus or such as would not have, or reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect; (2) all Liens on or affecting the Properties that are required to be disclosed in the Registration Statement, the General Disclosure Package and the Prospectus are disclosed therein and neither of the Transaction Entities nor the Subsidiaries is in default under any such Lien except for such defaults that would not have, or reasonably be expected to have, a Material Adverse Effect; (3) all of the leases and subleases material to the business of the Transaction Entities and the Subsidiaries, taken as a whole, and under which the Transaction Entities or any of the Subsidiaries holds properties described in the Registration Statement, the General Disclosure Package and the Prospectus, are in full force and effect, and neither of the Transaction Entities nor any Subsidiary has received any notice of any material claim of any sort that has been asserted by anyone adverse to the rights of any of the Transaction Entities or any Subsidiary under any of such leases or subleases, or affecting or questioning the rights of any of the Transaction Entities or such Subsidiary to the continued possession of the leases or subleased premises under any such lease or sublease; (4) neither of the Transaction Entities nor the Subsidiaries is in violation of any municipal, state or federal law, rule or regulation concerning the Properties or any part thereof which violation would have, or reasonably be expected to have, a Material Adverse Effect; (5) each of the Properties complies with all applicable zoning laws, laws, ordinances, regulations, development agreements, reciprocal easement agreements, ground or airspace leases and deed restrictions or other covenants, except where the failure to comply would not have, singly or in the aggregate, or reasonably be expected to have, a Material Adverse Effect; and (6) neither of the Transaction Entities nor the Subsidiaries has received from any Governmental Authority (as defined below) any written notice of any condemnation of or zoning change materially affecting the Properties or any part thereof, and neither of the Transaction Entities nor the Subsidiaries knows of any such condemnation or zoning change which is threatened and which if consummated would have, or reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
(ff) Each of the Transaction Entities and the Subsidiaries is insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are reasonably believed to be adequate in respect of the businesses in which they are or will be engaged as described in the Registration Statement, the General Disclosure Package and the Prospectus, all of which is, to the knowledge of the Transaction Entities, in full force and effect and each of the Transaction Entities and the Subsidiaries is in compliance with the terms of such policies and instruments in all material respects; except as described in the Registration Statement, the General Disclosure Package and the Prospectus, there are no material claims by any of the Transaction Entities or the Subsidiaries under any such
policy or instrument as to which any insurance company is denying liability or defending under a reservation of rights clause; and, except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, neither of the Transaction Entities nor the Subsidiaries has been refused any customary insurance coverage sought or applied for; and neither Transaction Entity has any reason to believe that any of the Transaction Entities or the Subsidiaries will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue to conduct its business as currently conducted or as proposed to be conducted in the Registration Statement, the General Disclosure Package and the Prospectus at a cost that would not have a Material Adverse Effect.
(gg) Except as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, the mortgages and deeds of trust encumbering the Properties are not convertible into equity interests in the Property nor will the Transaction Entities, the Subsidiaries, or any person affiliated therewith hold a participating interest therein, and such mortgages and deeds of trust are not cross-defaulted or cross-collateralized to any property not owned directly or indirectly by Transaction Entities.
(hh) The Transaction Entities or a Subsidiary has title insurance on the fee interests and/or leasehold interests in each of the Properties covering such risks and in such amounts as are commercially reasonable for the assets owned or leased by them and that are reasonably believed to be consistent with the types and amounts of insurance typically maintained by owners and operators of similar properties, and such title insurance is, to the knowledge of the Transaction Entities, in full force and effect.
(ii) Except as (x) otherwise described in the Registration Statement, the General Disclosure Package and the Prospectus or (y) would not have a Material Adverse Effect: (i) the Transaction Entities and the Subsidiaries and the Properties have been and are in compliance with, and neither of the Transaction Entities nor the Subsidiaries has any liability under, applicable Environmental Laws (as hereinafter defined), (ii) neither of the Transaction Entities nor the Subsidiaries has at any time released (as such term is defined in Section 101(22) of the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. §§ 9601-9675 (“CERCLA”)) or otherwise disposed of or dealt with, Hazardous Materials (as hereinafter defined) on, to or from the Properties or other assets owned by the Transaction Entities or the Subsidiaries, except for such releases or dispositions as would not be reasonably likely to cause the Transaction Entities or the Subsidiaries to incur liability and that would not require disclosure pursuant to Environmental Laws, (iii) neither Transaction Entity intends to use the Properties or other assets owned by any of the Transaction Entities or the Subsidiaries or any subsequently acquired properties, other than in compliance with applicable Environmental Laws, (iv) neither of the Transaction Entities nor the Subsidiaries knows of any seepage, leak, discharge, release, emission, spill, or dumping of Hazardous Materials into waters (including, but not limited to, groundwater and surface water) on, beneath or adjacent to the Properties, or onto lands or other assets owned by the Transaction Entities or the Subsidiaries from which Hazardous Materials might seep, flow or drain into such waters except for such as would
not be reasonably likely to cause the Transaction Entities or the Subsidiaries to incur liability, (v) neither of the Transaction Entities nor the Subsidiaries has received any notice of, or has any knowledge of any occurrence or circumstance which, with notice or passage of time or both, would give rise to a claim under or pursuant to any Environmental Law or common law by any governmental or quasi-governmental body or any third party with respect to the Properties or other assets described in the Registration Statement, the General Disclosure Package and the Prospectus or arising out of the conduct of the Transaction Entities or the Subsidiaries, except for such claims that would not be reasonably likely to cause the Transaction Entities or the Subsidiaries to incur liability and that would not require disclosure pursuant to Environmental Laws and (vi) neither the Properties nor any other assets currently owned by any of the Transaction Entities or the Subsidiaries is included or, to the knowledge of the Transaction Entities or the Subsidiaries, proposed for inclusion on the National Priorities List issued pursuant to CERCLA by the United States Environmental Protection Agency (the “EPA”) or, to the knowledge of the Transaction Entities or the Subsidiaries, proposed for inclusion on any similar list or inventory issued pursuant to any other applicable Environmental Law or issued by any other Governmental Authority. To the knowledge of the Transaction Entities or the Subsidiaries, there have been no and are no (i) aboveground or underground storage tanks, (ii) polychlorinated biphenyls (“PCBs”) or PCB-containing equipment, (iii) asbestos or asbestos containing materials, (iv) lead based paints, (v) dry-cleaning facilities, or (vi) wet lands, in each case in, on, under, or adjacent to any Property or other assets owned by the Transaction Entities or the Subsidiaries the existence of which has had, or is reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
As used herein, “Hazardous Material” shall include, without limitation, any flammable explosives, radioactive materials, hazardous materials, hazardous wastes, toxic substances, or related materials, asbestos or any hazardous material as defined or regulated by any applicable federal, state or local environmental law, ordinance, statute, rule or regulation including, without limitation, CERCLA, the Hazardous Materials Transportation Act, as amended, 49 U.S.C. §§5101-5128, the Solid Waste Disposal Act, as amended, 42 U.S.C. §§ 6901-6992k, the Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001-11050, the Toxic Substances Control Act, 15 U.S.C. §§ 2601-2692, the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. §§ 136-136y, the Clean Air Act, 42 U.S.C. §§ 7401-7671q, the Clean Water Act (Federal Water Pollution Control Act), 33 U.S.C. §§ 1251-1387, the Safe Drinking Water Act, 42 U.S.C. §§ 300f-300j-26, and the Occupational Safety and Health Act, 29 U.S.C. §§ 651-678, as any of the above statutes may be amended from time to time, and in the regulations promulgated pursuant to any of the foregoing (including environmental statutes not specifically defined herein) (individually, an “Environmental Law” and collectively, “Environmental Laws”) having or claiming jurisdiction over the Properties and other assets described in the Registration Statement, the General Disclosure Package and the Prospectus (a “Governmental Authority”).
(jj) No labor problem or dispute with the employees of the Transaction Entities or the Subsidiaries exists or, to the knowledge of the Transaction Entities, is threatened or
imminent, and neither Transaction Entity is aware of any existing or imminent labor disturbance by the employees of any of its or its Subsidiaries’ principal suppliers, contractors or customers, which, in either case, may reasonably be expected to result in a Material Adverse Effect.
(kk) Except as would not have, or reasonably be expected to have, a Material Adverse Effect, the Transaction Entities and the Subsidiaries own and have full right, title and interest in and to, or has valid licenses to use, each trade name, trademark, service mark, patent, copyright, approval, trade secret and other similar rights (collectively “Intellectual Property”) necessary for the conduct of their business taken as a whole as now conducted or as proposed in the Registration Statement, the General Disclosure Package and the Prospectus to be conducted. Except as set forth in the Registration Statement, the General Disclosure Package and the Prospectus and except as would not have, or reasonably expected to have, individually or in the aggregate, a Material Adverse Effect, (a) to the knowledge of the Transaction Entities, there are no rights of third parties to any such Intellectual Property, (b) to the knowledge of the Transaction Entities, there is no infringement by third parties of any such Intellectual Property, (c) there is no pending or, to the knowledge of the Transaction Entities, threatened action, suit, proceeding or claim by others challenging the Transaction Entities’ rights in or to any such Intellectual Property, and the Transaction Entities are unaware of any facts which would form a reasonable basis for any such claim, (d) there is no pending or, to the knowledge of the Transaction Entities, threatened action, suit, proceeding or claim by others challenging the validity or scope of any such Intellectual Property, and the Transaction Entities are unaware of any facts which would form a reasonable basis for any such claim and (e) there is no pending or, to the knowledge of the Transaction Entities, threatened action, suit, proceeding or claim by others that either Transaction Entity infringes or otherwise violates any patent, trademark, copyright, trade secret or other proprietary rights of others, and the Transaction Entities are unaware of any other fact which would form a reasonable basis for any such claim.
(ll) Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, there is not pending or, to the knowledge of the Transaction Entities, threatened, any action, suit or proceeding against or affecting any of the Transaction Entities, the Subsidiaries or any of the Properties or other assets that, if determined adversely to any of the Transaction Entities or the Subsidiaries, would have, or reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, or would materially and adversely affect the ability of the Transaction Entities to perform their obligations under this Agreement, the Indenture or the Securities.
(mm) Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, since the date of the latest audited financial statements included or incorporated or deemed incorporated by reference in the Registration Statement, the General Disclosure Package or the Prospectus, (1) there has been no Material Adverse Effect, (2) there have been no transactions entered into by any of the Transaction Entities or the Subsidiaries which are material with respect to the Transaction Entities and their Subsidiaries taken as a whole, (3) neither of the Transaction Entities nor the Subsidiaries has incurred
any obligation or liability, direct, contingent or otherwise that is or would be material to the Transaction Entities and the Subsidiaries taken as a whole and (4) except for regular distributions on the Company’s common stock and OP Units that are consistent with past practice, there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock or by the Operating Partnership or any of its subsidiaries with respect to its OP Units.
(nn) Neither of the Transaction Entities nor any Subsidiary is or, after giving effect to the offering and sale of the Securities and the application of the proceeds thereof as described in the General Disclosure Package and the Prospectus, will be, required to register as an “investment company” within the meaning of the Investment Company Act of 1940, as amended (the “1940 Act”).
(oo) There are no contracts or other documents that are required to be described in the Prospectus or to be filed as an exhibit to the Registration Statement that are not described, filed or incorporated by reference in the Registration Statement and the Prospectus as required by the 1933 Act.
(pp) No relationship, direct or indirect, exists between or among either Transaction Entity, on the one hand, and the directors, officers, stockholders, customers or suppliers of either Transaction Entity, on the other hand, which is required pursuant to the 1933 Act, the 1933 Act Regulations, the 1934 Act or the 1934 Act Regulations to be described in the Registration Statement, the General Disclosure Package or the Prospectus which is not so described.
(qq) Each of the Transaction Entities maintains internal accounting controls which provide reasonable assurance that (i) transactions are executed in accordance with management’s authorization, (ii) transactions are recorded as necessary to permit preparation of its financial statements in conformity with GAAP and to maintain accountability for its assets, (iii) access to its assets is permitted only in accordance with management’s authorization and (iv) the reported accountability for its assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Since the end of the Transaction Entities’ most recent audited fiscal year, there has been (A) no material weakness in their internal control over financial reporting (whether or not remediated) and (B) no change in their internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, their internal control over financial reporting.
(rr) The Transaction Entities employ disclosure controls and procedures that are designed to ensure that information required to be disclosed by them in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated to management, including the principal executive officer or officers and principal financial officer or officers, as appropriate, to allow timely decisions regarding disclosure.
(ss) There is and has been no failure on the part of either Transaction Entity or their directors or officers, in their capacities as such, to comply in all material respects with any provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith (the “Sarbanes-Oxley Act”), including Section 402 related to loans and Sections 302 and 906 related to certifications, in each case, to the extent the Sarbanes-Oxley Act applies to the Transaction Entities.
(tt) The operations of the Transaction Entities and the Subsidiaries are and have been conducted at all times in compliance in all material respects with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving any of the Transaction Entities or the Subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or the Transaction Entities, threatened.
(uu) None of the Transaction Entities, the Subsidiaries or, to the knowledge of the Transaction Entities, any director, officer, agent, employee or affiliate of any of the Transaction Entities or the Subsidiaries, is aware of or has taken any action, directly or indirectly, that would result in a material violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the “FCPA”), including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA, and the Transaction Entities, the Subsidiaries and, to the knowledge of the Transaction Entities, their affiliates have conducted their businesses in compliance with the FCPA in all material respects.
(vv) None of the Transaction Entities, the Subsidiaries or, to the knowledge of the Transaction Entities, any director, officer, agent, employee or affiliate of any of the Transaction Entities or the Subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Operating Partnership will not directly or indirectly use the proceeds of the offering of the Securities, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.
(ww) None of the Transaction Entities, the Subsidiaries or, to the knowledge of the Transaction Entities, their respective officers, directors, members or controlling persons has taken, or will take, directly or indirectly, any action designed to or that might reasonably be expected to result in a violation of Regulation M under the 1934 Act or cause or result
in stabilization or manipulation of the price of any security to facilitate the sale or resale of the Securities.
(xx) The Operating Partnership intends to apply the net proceeds from the sale of the Securities substantially in accordance with the description set forth in the General Disclosure Package and the Prospectus under the heading “Use of Proceeds.”
(yy) Throughout the period from its formation through the date hereof, the Operating Partnership has been properly classified either as a partnership or as an entity disregarded as separate from the Company for federal income tax purposes and not as a “publicly traded partnership” within the meaning of Section 7704(b) of the Code.
(zz) Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus, none of Transaction Entities or the Subsidiaries are currently prohibited, directly or indirectly, from paying any distributions to the Transaction Entities to the extent permitted by applicable law, from making any other distribution on their equity interests owned by the Transaction Entities, or from repaying to the Transaction Entities any loans or advances made by the Transaction Entities to any such Subsidiary.
Any certificate or document signed by any officer or representative of the Transaction Entities and delivered to any Underwriter, or to counsel for the Underwriters, shall be deemed a representation and warranty by each of the Transaction Entities, as to matters set forth therein to each Underwriter.
2. Purchase and Sale. Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, the Operating Partnership agrees to sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Operating Partnership, at a purchase price of 99.341% of the aggregate principal amount of each Note (representing a public offering price of 99.991% of the principal amount of each Note, less an underwriting discount of 0.650% of the principal amount of each Note), the aggregate principal amount of Notes set forth opposite such Underwriter’s name in Schedule I hereto.
3. Delivery and Payment. Delivery of and payment for the Securities shall be made at 10:00 a.m., New York City time, at the offices of Sidley Austin LLP, 787 Seventh Avenue, New York, New York 10019, on November 24, 2014, or at such time on such later date not more than three business days after the foregoing date as the Representatives and the Transaction Entities shall agree, which date and time may be postponed by agreement between the Representatives and the Transaction Entities or as provided in Section 9 hereof (such date and time of delivery and payment for the Securities being herein called the “Closing Date”). Delivery of the Securities shall be made to the Representatives for the respective accounts of the several Underwriters against payment by the several Underwriters through the Representatives of the purchase price thereof to or upon the order of the Operating Partnership by wire transfer payable in same-day funds to an account specified by the Operating Partnership.
The Notes shall be issued in book-entry only form through the facilities of The Depository Trust Company (“DTC”) and shall be represented by one or more global certificates in
such denominations and registered in such names as the Representatives may request in writing at least two full business days before the Closing Date. The certificates representing the Notes will be made available for examination and packaging by the Representatives in The City of New York not later than 10:00 A.M., New York City time, one full business day prior to the Closing Date.
4. Offering by Underwriters. It is understood that the several Underwriters propose to offer the Securities for sale to the public as set forth in the General Disclosure Package and the Prospectus.
5. Agreements. The Company agrees with the several Underwriters that:
(a) The Company will comply, subject to the remainder of this clause (a), with the requirements of Rule 430B. Prior to the termination of the offering of the Securities, the Company will not use or file any amendment to the Registration Statement or amendment or supplement to the General Disclosure Package or the Prospectus or any new registration statement relating to the Securities unless the Company has furnished the Representative an electronic copy for review prior to filing and will not file or use any such proposed amendment or supplement or new registration statement to which the Representative reasonably objects. The Transaction Entities have given the Representatives notice of any filings made pursuant to the 1934 Act or 1934 Act Regulations within 48 hours prior to the Applicable Time; the Transaction Entities will give the Representatives notice of their intention to make any such filing from the Applicable Time to the Closing Date and will furnish the Representatives with copies of any such documents a reasonable amount of time prior to such proposed filing and will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably object. The Transaction Entities will cause the Prospectus, properly completed, and any supplement thereto to be filed in a form approved by the Representative with the Commission pursuant to the applicable paragraph of Rule 424(b) within the time period prescribed and will provide evidence satisfactory to the Representatives of such timely filing. After the date of this Agreement and during any period in which a Prospectus relating to the Securities is required to be delivered by the Underwriters under the 1933 Act (including in circumstances where such requirement may be satisfied pursuant to Rule 172 of the 1933 Act Regulations (“Rule 172”)), the Transaction Entities will promptly advise the Representatives (1) of the effectiveness of any amendment to the Registration Statement or any new registration statement relating to the Securities, (2) of the transmittal to the Commission for filing of any supplement or amendment to the Prospectus or any document to be filed pursuant to the 1934 Act that will be incorporated by reference into the Prospectus, (3) of the receipt of any comments from the Commission with respect to the Registration Statement or Prospectus or documents incorporated or deemed to be incorporated by reference therein, (4) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information relating thereto, (5) of the issuance of any stop order by the Commission suspending the effectiveness of the Registration Statement, or any order preventing or suspending the use of any preliminary prospectus or the Prospectus or the institution or threatening of any proceedings for that purpose or of any examination pursuant to Section 8(e) of the 1933 Act concerning the
Registration Statement, (6) if either Transaction Entity becomes the subject of a proceeding under Section 8A of the 1933 Act in connection with the offering of the Securities, and (7) of the receipt by either Transaction Entity of any notification with respect to the suspension of the qualification of the Securities for sale in any jurisdiction or the institution or threatening of any proceeding for such purpose. The Transaction Entities will use their best efforts to prevent the issuance of any such order or the suspension of any such qualification, and, if issued, to obtain as soon as possible, the withdrawal thereof. The Transaction Entities shall pay the required Commission filing fees relating to the Securities within the time required by Rule 456(b)(1)(i) of the 1933 Act Regulations without regard to the proviso therein and otherwise in accordance with Rules 456(b) and 457(r) of the 1933 Act Regulations (including, if applicable, by updating the “Calculation of Registration Fee” table in accordance with Rule 456(b)(1)(ii) either in a post-effective amendment to the Registration Statement or on the cover page of a prospectus filed pursuant to Rule 424(b)).
(b) Subject to the last sentence of this Section 5(b), if, immediately prior to the third anniversary of the initial effective date of the Registration Statement, any Securities remain unsold by the Underwriters, the Transaction Entities will, prior to that date, (i) promptly notify the Representatives, (ii) immediately file a new registration statement relating to such Securities, in a form satisfactory to the Representatives, so that the securities covered by the Registration Statement may continue to be offered and sold thereunder as permitted by Rule 415(a)(5) of the 1933 Act pending the effectiveness of the new registration statement contemplated by this Section 5(b) and use its best efforts to cause such registration statement to be declared effective on a date determined by the Transaction Entities on or prior to the 180th day following the initial filing thereof, and (iii) promptly notify the Representatives of such effectiveness. References herein to the “Registration Statement” shall include such new registration statement upon the effectiveness of such new registration statement as contemplated hereby, if at all; provided, however, if the Representatives notify the Transaction Entities that no Securities remain unsold, the Transaction Entities shall not be obligated to file a registration statement (or otherwise request the effectiveness thereof) pursuant to this Section 5(b).
(c) If, at any time when a prospectus relating to the Securities is required to be delivered (or but for the exception afforded by Rule 172 would be required to be delivered) under the 1933 Act, any event or development occurs as a result of which, in the opinion of counsel for the Underwriters or for the Transaction Entities, the Registration Statement or the Prospectus would include any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein (in the case of the Prospectus, in the light of the circumstances under which they were made) not misleading, or if it shall be necessary, in the opinion of counsel for the Underwriters or for the Transaction Entities, to amend the Registration Statement or amend or supplement the Prospectus to comply with the 1933 Act or the 1933 Act Regulations or to file a new registration statement relating to the Securities, the Transaction Entities will promptly (1) notify the Representatives of any such event or development, (2) prepare and file with the Commission, subject to Section 5(a) hereof, such amendment, supplement or new registration statement which will correct such statement or omission, effect such compliance or satisfy such filing requirement, (3)
use their best efforts to have any such amendment to the Registration Statement or new registration statement declared effective as soon as possible (if not an automatic shelf registration statement) and (4) supply any amended or supplemented Prospectus to the Underwriters in such quantities as they may reasonably request. If, at any time when a Prospectus relating to the Securities is required to be delivered (or but for the exception afforded by Rule 172 would be required to be delivered), an event or development occurs as a result of which, in the opinion of counsel for the Underwriters or for the Transaction Entities, the General Disclosure Package contains an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at the time it is used, not misleading, the Transaction Entities promptly will (1) notify the Representatives of any such event or development, (2) prepare, subject to Section 5(a), an amendment or supplement to the General Disclosure Package to eliminate or correct such untrue statement or omission and (3) supply any amended or supplemented General Disclosure Package to the Underwriters in such quantities as they may reasonably request. If, at any time when a Prospectus relating to the Securities is required to be delivered (or but for the exception afforded by Rule 172 would be required to be delivered), an event or development occurs as a result of which, in the opinion of counsel for the Underwriters or for the Transaction Entities, any Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement (or any other registration statement relating to the Securities), the Statutory Prospectus or the Prospectus or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances prevailing at that subsequent time, not misleading, the Transaction Entities will promptly notify the Underwriters and will promptly amend or supplement, at their own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.
(d) As soon as practicable, the Transaction Entities will make generally available to their security holders and to the Representatives an earnings statement or statements of the Transaction Entities which will satisfy the provisions of Section 11(a) of the 1933 Act and Rule 158 under the 1933 Act.
(e) The Transaction Entities will furnish to the Representatives and counsel for the Underwriters conformed copies of the Registration Statement (including exhibits thereto) and to each other Underwriter a conformed copy of the Registration Statement and, so long as delivery of a prospectus by an Underwriter or dealer is or may be (or but for the exception afforded by Rule 172 would be) required by the 1933 Act, as many copies of any preliminary prospectus and the Prospectus as the Representatives may reasonably request.
(f) The Transaction Entities will prepare a final term sheet, in a form approved by the Representatives and substantially in the form set forth in Schedule III to this Agreement, and will file such term sheet pursuant to Rule 433(d) of the 1933 Act Regulations within the time required by such rule (the “Final Term Sheet”). The Transaction Entities acknowledge that the Final Term Sheet is an Issuer Free Writing Prospectus for purposes of this Agreement.
(g) Each Transaction Entity represents and agrees that, unless it obtains the prior written consent of the Underwriters, and each Underwriter agrees that, unless it obtains the prior written consent of the Transaction Entities and the other Underwriters, it has not made and will not make any offer relating to the Securities that would constitute an “issuer free writing prospectus,” as defined in Rule 433, or that would otherwise constitute a “free writing prospectus,” as defined in Rule 405, required to be filed with the Commission other than the Issuer Free Writing Prospectuses, if any, identified on Schedule II hereto. Each of the Issuer Free Writing Prospectuses, if any, identified on Schedule II hereto and free writing prospectuses, if any, consented to by the Transaction Entities and the Underwriters is referred to herein as a “Permitted Free Writing Prospectus.” Each Transaction Entity represents that it has treated or agrees that it will treat each Permitted Free Writing Prospectus as an “issuer free writing prospectus,” as defined in Rule 433, and has complied and will comply with the requirements of Rule 433 applicable to any Permitted Free Writing Prospectus, including timely filing with the Commission where required, legending and record keeping. Notwithstanding the foregoing, each Transaction Entity consents to the use by any Underwriter of a free writing prospectus that contains only (a)(i) information describing the preliminary terms of the Securities or their offering, (ii) information meeting the requirements of Rule 134 of the 1933 Act Regulations or (iii) information that describes the final terms of the Securities or their offering or (b) other customary information that is neither “issuer information,” as defined in Rule 433, nor otherwise an Issuer Free Writing Prospectus.
(h) The Transaction Entities will arrange, if necessary, for the qualification of the Securities for sale under the laws of such jurisdictions as the Representatives may designate and will maintain such qualifications in effect so long as required for the distribution of the Securities; provided, however, that in no event shall either Transaction Entity be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action that would subject it to service of process in suits, other than those arising out of the offering or sale of the Securities, in any jurisdiction where it is not now so subject.
(i) Between the date of this Agreement and one day after the Closing Date, neither Transaction Entity will, without the Representatives’ prior written consent, offer to sell, enter into any agreement to sell, or sell, any United States dollar-denominated debt securities issued or guaranteed by either Transaction Entity having a term of more than one year, other than the Securities.
(j) The Company will use its best efforts to meet the requirements to qualify, for the taxable year ending December 31, 2014 and for each of its succeeding taxable years for so long as the Board of Directors of the Company deems it in the best interests of the Company’s stockholders to remain so qualified, for taxation as a REIT under the Code.
(k) For so long as the delivery of a prospectus is required by federal or state law in connection with the offering or sale of the Securities, the Transaction Entities will comply in all material respects with all applicable securities and other applicable laws, rules and
regulations, including, without limitation, the Sarbanes-Oxley Act, and will use their best efforts to cause the Company’s directors and officers, on behalf of the Company and the Operating Partnership, to comply in all material respects with such laws, rules and regulations, including, without limitation, the provisions of the Sarbanes-Oxley Act.
(l) Neither of the Transaction Entities nor any Subsidiaries will take, directly or indirectly, any action designed to, or that would constitute or that might reasonably be expected to, cause or result in, under the 1934 Act or otherwise, stabilization or manipulation of the price of any of their securities to facilitate the sale or resale of the Securities.
(m) For so long as the delivery of a prospectus is required by federal or state law in connection with the offering or sale of the Securities, the Transaction Entities will take such steps as shall be necessary to ensure that neither of the Transaction Entities nor any Subsidiary shall be required to register as an “investment company” within the meaning of the 1940 Act and the rules and regulations of the Commission thereunder.
(n) The Transaction Entities agree to pay the costs and expenses relating to the following matters: (i) the preparation and filing with the Commission of the Registration Statement (including financial statements and exhibits thereto), any preliminary prospectus, the Prospectus, any Permitted Free Writing Prospectus and all amendments or supplements to any of them; (ii) the printing (or reproduction) and delivery (including postage, air freight charges and charges for counting and packaging) of such copies of the Registration Statement, any preliminary prospectus, the Prospectus, any Permitted Free Writing Prospectus and all amendments or supplements to any of them, as may, in each case, be reasonably requested for use in connection with the offering and sale of the Securities; (iii) the preparation, printing, authentication, issuance and delivery of the Guarantee and certificates for the Notes, including any stamp or transfer taxes in connection with the original issuance and sale of the Securities; (iv) the printing (or reproduction) and delivery of this Agreement, any blue sky memorandum or any supplement thereto and all other agreements or documents printed (or reproduced) and delivered in connection with the offering of the Securities; (v) any registration or qualification of the Securities for offer and sale under the securities or blue sky laws of the jurisdictions referenced in Section 5(h) hereof (including filing fees and the reasonable fees and expenses of counsel for the Underwriters relating to such registration and qualification); (vi) any filings required to be made with FINRA (including filing fees and the reasonable fees and expenses of counsel for the Underwriters relating to such filings); (vii) the transportation and other expenses incurred by or on behalf of representatives of the Transaction Entities in connection with presentations to prospective purchasers of the Securities, if any; (viii) the fees and expenses of the Transaction Entities’ accountants and counsel (including local and special counsel), as well as the Trustee and any paying agent; (ix) all fees payable in connection with the rating of the Securities by the rating agencies; (x) all fees and expenses associated with making the Notes eligible for clearance, settlement and trading through the facilities of DTC; (xi) any travel expenses of the officers and employees of the Transaction Entities and any other expenses of the Transaction Entities in connection with attending or hosting meetings with prospective purchasers of the Securities; (xii) all other costs and expenses incident to the performance
by the Transaction Entities of their obligations hereunder; and (xiii) the reasonable costs and expenses associated with the reforming of any contracts for sale of the Securities made by the Underwriters caused by a breach of the representation contained in the fifth paragraph of Section 1(a) hereof.
(o) During the period when a prospectus is required (or but for the exception afforded by Rule 172 would be required) to be delivered by the Underwriters under the 1933 Act or the 1934 Act, the Transaction Entities will (1) comply with all provisions of the 1933 Act and (2) file all documents required to be filed with the Commission pursuant to the 1934 Act or the 1934 Act Regulations within the time periods prescribed therefor.
6. Conditions to the Obligations of the Underwriters. The obligations of the Underwriters to purchase the Securities shall be subject to the accuracy of the representations and warranties (in each case, subject to the qualifications, if any, described therein) on the part of the Transaction Entities contained herein as of the date hereof, the Applicable Time and the Closing Date pursuant to Section 3 hereof, to the accuracy of the statements of the Transaction Entities made in any certificates pursuant to the provisions hereof, to the performance by the Transaction Entities of their obligations hereunder and to the following additional conditions:
(a) On the Closing Date, (i) the Registration Statement has become effective and no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission, and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Underwriters, and no notice of objection of the Commission to the use of such form of registration statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) has been received by either Transaction Entity, (ii) each preliminary prospectus and the Prospectus shall have been filed with the Commission in the manner and within the time period required by Rule 424(b) without reliance on Rule 424(b)(8) (or a post-effective amendment providing such information shall have been filed and become effective in accordance with the requirements of Rule 430B), and no order preventing or suspending the use of any preliminary prospectus or the Prospectus shall have been issued by the Commission or the securities authority of any jurisdiction, (iii) any material required to be filed by the Transaction Entities pursuant to Rule 433(d) of the 1933 Act Regulations shall have been filed with the Commission within the applicable time periods prescribed for such filings under such Rule 433, and (iv) there shall not have come to the attention of the Representatives any facts that would cause the Representatives to believe, after consultation with counsel, that the General Disclosure Package or the Prospectus, at the time it was, or was required to be, delivered or made available to purchasers of the Securities, included an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances existing at such time, not misleading.
(b) The Transaction Entities shall have requested and caused Morrison & Foerster LLP, counsel for the Transaction Entities, to have furnished to the Representatives their opinion, dated the Closing Date and addressed to the Representatives, to the matters
attached as Exhibit A and Exhibit A-1 hereto. In rendering such opinion, such counsel may rely (A) as to matters involving the application of laws of any jurisdiction other than the State of Delaware (to the extent limited to Delaware corporate laws) or the federal laws of the United States, to the extent they deem proper and specified in such opinion, upon the opinion of other counsel of good standing whom they believe to be reliable and who are satisfactory to counsel for the Underwriters and (B) as to matters of fact, to the extent they deem proper, on certificates of responsible officers and other representatives of the Transaction Entities and public officials. Such opinion shall also cover any amendments or supplements thereto at the Closing Date. The Underwriters acknowledge that the law firm of Venable LLP, special Maryland counsel to the Company, is satisfactory for the purposes of this Section 6(b).
In addition, Morrison & Foerster LLP shall state that, although such counsel has not independently verified and is not passing upon and assumes no responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement, the General Disclosure Package or the Prospectus, no facts have come to such counsel’s attention that have caused such counsel to believe that (i) the Registration Statement, as of its most recent effective date, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or, (ii) the General Disclosure Package, at the Applicable Time, contained an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading or (iii) the Prospectus, or any amendment or supplement thereto, as of their respective issue dates or at the Closing Date, as the case may be, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading (in each case, other than the financial statements, schedules and other financial or accounting data or information included or incorporated by reference therein or excluded therefrom, as to which such counsel need express no statement).
(c) The Representatives shall have received the favorable opinion, dated the Closing Date, of Venable LLP, special Maryland counsel of the Company, to the matters attached as Exhibit B hereto.
(d) The Representatives shall have received from Sidley Austin LLP, counsel for the Underwriters, such opinion or opinions, dated the Closing Date and addressed to the Representatives, with respect to the issuance and sale of the Securities, the disclosure in the Registration Statement, the General Disclosure Package and the Prospectus and other related matters as the Representatives may reasonably require, and the Transaction Entities shall have furnished to such counsel such documents as they reasonably request for the purpose of enabling them to pass upon such matters. In rendering such opinion, such counsel may rely, as to matters of fact (but not as to legal conclusions), to the extent they deem proper, on certificates of responsible officers and other representatives of the Transaction Entities and public officials. In addition, in rendering such opinion, such counsel may rely on and
assume the accuracy of the opinion of Venable LLP, special Maryland counsel to the Company, dated as of the Closing Date, with respect to matters of Maryland law.
(e) The Representatives shall have received a certificate of the president or an executive vice president of the Company, on behalf of the Company and as sole stockholder of Education Realty OP GP, Inc. (general partner of the Operating Partnership), and of the chief financial officer or chief accounting officer of the Company, on behalf of the Company and as sole stockholder of Education Realty OP GP, Inc. (general partner of the Operating Partnership), dated the Closing Date, to the effect that the signers of such certificate have carefully examined the Registration Statement, the General Disclosure Package and the Prospectus and any amendments or supplements to the foregoing, as well as this Agreement, and that:
(i) the representations and warranties (in each case, subject to the qualifications, if any, described therein) of the Transaction Entities in this Agreement are true and correct on and as of the Closing Date with the same effect as if made on the Closing Date and the Transaction Entities have complied with all the agreements and satisfied all the conditions on their part to be performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to the Company’s knowledge, are threatened by the Commission, and no notice of objection of the Commission to the use of such form of registration statement or any post-effective amendment thereto pursuant to Rule 401(g)(2) has been received by either Transaction Entity, and no order preventing or suspending the use of any preliminary prospectus or the Prospectus has been issued by the Commission or the securities authority of any jurisdiction; and
(iii) since the date of the most recent financial statements included or incorporated or deemed incorporated by reference in the Registration Statement, the General Disclosure Package and the Prospectus, there has been no material adverse effect on the condition (financial or otherwise), business, earnings, properties, assets or prospects of the Transaction Entities and the Subsidiaries taken as a whole, except as set forth in or contemplated in the Registration Statement, the General Disclosure Package and the Prospectus (for the avoidance of doubt, excluding any documents incorporated or deemed to be incorporated by reference therein after the date hereof).
(f) The Representatives shall have received a certificate of the chief financial officer of the Company, dated the Closing Date, in a form reasonably satisfactory to the Representatives.
(g) At the date hereof, the Representatives shall have received a letter from Deloitte & Touche LLP dated such date, in form and substance reasonably satisfactory to the Representatives, together with signed or reproduced copies of such letter for each of the other Underwriters containing statements and information of the type ordinarily included
in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information relating to the Transaction Entities and the Subsidiaries contained in the Registration Statement, the General Disclosure Package and the Prospectus.
(h) On the Closing Date, the Representatives shall have received a letter, dated the Closing Date, of Deloitte & Touche LLP, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection (g) of this Section 6, except that the specified date referred to shall be a date not more than three business days prior to the Closing Date.
(i) Subsequent to the execution of this Agreement or, if earlier, the dates as of which information is given in the Registration Statement, the General Disclosure Package and the Prospectus, there shall not have been (i) any change or decrease specified in the letter referred to in Section 6(g) or (ii) any change, or any development involving a prospective change, in or affecting the condition (financial or otherwise), earnings, business, assets, prospects or properties of the Transaction Entities and the Subsidiaries taken as a whole, except as set forth in or contemplated in the Registration Statement, the General Disclosure Package and the Prospectus, the effect of which, in any case referred to in clause (i) or (ii) above, is, in the judgment of the Representatives, so material and adverse as to make it impractical or inadvisable to proceed with the offering or delivery of the Securities as contemplated by the Registration Statement, the General Disclosure Package and the Prospectus, (iii) any downgrading in, or withdrawal of, the rating of any debt securities of, or guaranteed by, either Transaction Entity (including the Securities) by any “nationally recognized statistical rating organization” (as defined for purposes of Rule 436(g) under the 1933 Act), or any public announcement that any such organization has under surveillance or review its rating of any such securities (other than an announcement with positive implications of a possible upgrading, and no implication of a possible downgrading, of such rating), (iv) any suspension or material limitation by the Commission of trading in the Company’s common stock or the Operating Partnership’s debt securities or trading in securities generally on the New York Stock Exchange (“NYSE”) or any setting of minimum or maximum prices on such exchange, or maximum ranges of prices have been required, by such exchange or by such system or by order of the Commission, FINRA or any other governmental authority, (v) any banking moratorium declared either by federal or New York State authorities or (vi) any outbreak or significant escalation of hostilities, declaration by the United States of a national emergency or war, or other calamity or crisis or any significant change in national or international political, financial or economic condition, the effect of which on financial markets is such as to make it, in the judgment of the Representatives, impractical or inadvisable to proceed with the offering or delivery of the Securities as contemplated by the General Disclosure Package and the Prospectus.
(j) On the Closing Date, counsel for the Underwriters shall have been furnished with such other documents as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Securities as herein contemplated and related proceedings, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by
the Transaction Entities in connection with the issuance and sale of the Securities as herein contemplated shall be reasonably satisfactory in form and substance to the Underwriters and counsel for the Underwriters.
(k) Prior to the Closing Date, the Transaction Entities shall have furnished to the Representative such further information, certificates and documents as the Representative may reasonably request.
Any certificate or document signed by any officer or representative of the Transaction Entities and delivered to any Underwriter, or to counsel for the Underwriters, shall be deemed a representation and warranty by each Transaction Entity, as to matters set forth therein, to each Underwriter as to the statements made therein.
The Representatives may in their sole discretion waive on behalf of the Underwriters compliance with any conditions to the obligations of the Underwriters hereunder, whether in respect of the Closing Date or otherwise.
If any of the conditions specified in this Section 6 shall not have been fulfilled when and as provided in this Agreement, or if any of the opinions and certificates mentioned above or elsewhere in this Agreement shall not be reasonably satisfactory in form and substance to the Representatives, this Agreement and all obligations of the Underwriters hereunder may be terminated at, or at any time prior to, the Closing Date by the Representatives, and such termination shall be without liability of any party to any other party except as provided in Section 7 hereof and except that Sections 1 and 8 hereof shall survive any such termination and remain in full force and effect. Notice of such termination shall be given to the Transaction Entities in writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be delivered at the offices of Sidley Austin LLP, counsel for the Underwriters, at 787 Seventh Avenue, New York, NY 10019, on the Closing Date.
7. Reimbursement of Underwriters’ Expenses. If the sale of the Securities provided for herein is not consummated because any condition to the obligations of the Underwriters set forth in Section 6 hereof (other than Section 6(i)(iv) (other than the Company’s common stock or the Operating Partnership’s debt securities), Section 6(i)(v) and Section 6(i)(vi)) is not satisfied, because of any termination pursuant to Section 10(a)(i) (with respect to the Securities) or 10(a)(iv) hereof or because of any refusal, inability or failure on the part of either Transaction Entity to perform any agreement herein or comply with any provision hereof other than by reason of a default by any of the Underwriters, the Transaction Entities will reimburse the Underwriters severally through the Representatives on demand for all out-of-pocket expenses (including reasonable fees and disbursements of counsel) that shall have been reasonably incurred by them in connection with the proposed purchase and sale of the Securities.
8. Indemnification and Contribution. (%3) Each Transaction Entity agrees, jointly and severally, to indemnify and hold harmless each Underwriter, the directors, officers, employees and agents of each Underwriter, each person who controls any Underwriter within the
meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act and each affiliate of any Underwriter within the meaning of Rule 405 of the 1933 Act Regulations (i) against any and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the 1933 Act, the 1934 Act or other federal or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement, including the Rule 430B Information, or in any amendment to the Registration Statement, or in the General Disclosure Package, any preliminary prospectus, the Prospectus, any Issuer Free Writing Prospectus or any roadshow materials not constituting an Issuer Free Writing Prospectus used in connection with the offer of Securities or in any amendment thereof or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein (other than with respect to the Registration Statement or any amendment thereto, in light of the circumstances under which they were made) or necessary to make the statements therein not misleading, (ii) against any and all loss, claim, damage, liability and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 8(d) below) any such settlement is effected with the written consent of the Transaction Entities) and (iii) against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Representatives), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) of this Section 8(a); provided, however, neither Transaction Entity will be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made therein in reliance upon and in conformity with written information furnished to the Transaction Entities by or on behalf of any Underwriter through the Representatives specifically for inclusion therein (that information being limited to that described in the last sentence of Section 8(b) hereof). This indemnity agreement will be in addition to any liability which either Transaction Entity may otherwise have.
(a) Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless each Transaction Entity and each of the Company’s directors and each of the Company’s officers, on behalf of the Company, in its own capacity, and as the sole owner of Education Realty OP GP, Inc., as the sole general partner of the Operating Partnership, who signed the Registration Statement, each person who controls the Transaction Entities within the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act and each affiliate of the Transaction Entities within the meaning of Rule 405 of the 1933 Act Regulations to the same extent as the foregoing indemnity from the Transaction Entities to each Underwriter, but only with reference to written information relating to such Underwriter furnished to the Transaction Entities by or on behalf of such Underwriter through the Representatives specifically for inclusion in the documents referred to in the foregoing indemnity. This indemnity agreement will be in addition to any liability which any
Underwriter may otherwise have. The Transaction Entities acknowledge that the statements set forth under the third paragraph, the third sentence of the fourth paragraph, the first sentence of the fifth paragraph, the first sentence of the sixth paragraph and the third sentence of the seventh paragraphs under the caption “Underwriting (Conflicts of Interest)” in the Prospectus constitute the only information furnished in writing by or on behalf of the several Underwriters for inclusion in the Registration Statement, the General Disclosure Package, any preliminary prospectus, any Issuer Free Writing Prospectus or the Prospectus, or any amendment or supplement thereto, or any roadshow materials and as such information is referred to in Sections 1(a), 1(e), 8(a) and 8(b) of this Agreement.
(b) Promptly after receipt by an indemnified party under this Section 8 of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section 8, notify the indemnifying party in writing of the commencement thereof; but the failure so to notify the indemnifying party (i) will not relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not otherwise learn of such action and such failure results in the forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not, in any event, relieve the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph (a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice at the indemnifying party’s expense to represent the indemnified party in any action for which indemnification is sought (in which case the indemnifying party shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the indemnified party or parties except as set forth below); provided, however, that such counsel shall be reasonably satisfactory to the indemnified party. Notwithstanding the indemnifying party’s election to appoint counsel to represent the indemnified party in an action, the indemnified party shall have the right to employ separate counsel (including local counsel), and the indemnifying party shall bear the reasonable fees, costs and expenses of such separate counsel if (i) the use of counsel chosen by the indemnifying party to represent the indemnified party would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party, (iii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of the institution of such action or (iv) the indemnifying party shall authorize the indemnified party to employ separate counsel at the expense of the indemnifying party. An indemnifying party will not, without the prior written consent of the indemnified parties, which consent shall not be unreasonably withheld, settle or compromise or consent to the entry of any judgment with respect to any pending or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding and
does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party.
(c) If at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 8(a)(ii) effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.
(d) In the event that the indemnity provided in paragraph (a) or (b) of this Section 8 is unavailable to or insufficient to hold harmless an indemnified party for any reason, the Transaction Entities and the Underwriters, severally in proportion to their respective commitments to purchase the Securities specified in Schedule I hereto, agree to contribute to the aggregate losses, claims, damages and liabilities (including legal or other expenses reasonably incurred in connection with investigating or defending the same) (collectively, “Losses”) to which the Transaction Entities and one or more of the Underwriters may be subject in such proportion as is appropriate to reflect the relative benefits received by the Transaction Entities on the one hand and by the Underwriters on the other from the offering of the Securities; provided, however, that in no case shall any Underwriter (except as may be provided in any agreement among underwriters relating to the offering of the Securities) be responsible for any amount in excess of the underwriting discount or commission applicable to the Securities purchased by such Underwriter hereunder. If the allocation provided by the immediately preceding sentence is unavailable for any reason, the Transaction Entities and the Underwriters severally shall contribute in such proportion as is appropriate to reflect not only such relative benefits, but also the relative fault of the Transaction Entities on the one hand and of the Underwriters on the other in connection with the statements or omissions which resulted in such Losses as well as any other relevant equitable considerations. Benefits received by the Transaction Entities shall be deemed to be equal to the total net proceeds from the offering of the Securities (before deducting expenses) received by them; and benefits received by the Underwriters shall be deemed to be equal to the total underwriting discounts and commissions, in each case as set forth on the cover page of the Prospectus. Relative fault shall be determined by reference to, among other things, whether any untrue or any alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information provided by the Transaction Entities on the one hand or the Underwriters on the other, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. The Transaction Entities and the Underwriters agree that it would not be just and equitable if contribution were determined by pro rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above. Notwithstanding the provisions of this paragraph (e), no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall
be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 8, each person who controls an Underwriter within the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act, each affiliate of any Underwriter within the meaning of Rule 405 of the 1933 Act Regulations and each director, officer, employee and agent of an Underwriter shall have the same rights to contribution as such Underwriter, and each person who controls the Transaction Entities within the meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act, each affiliate of the Transaction Entities within the meaning of Rule 405 of the 1933 Act Regulations, each officer of the Company, on behalf of the Company, in its own capacity, and as the sole owner of Education Realty OP GP, Inc., as the sole general partner of the Operating Partnership, who shall have signed the Registration Statement and each director of the Company shall have the same rights to contribution as the Transaction Entities subject in each case to the applicable terms and conditions of this paragraph (e).
9. Default by an Underwriter. If any one or more Underwriters shall fail to purchase and pay for any of the Securities agreed to be purchased by such Underwriter or Underwriters hereunder and such failure to purchase shall constitute a default in the performance of its or their obligations under this Agreement, the remaining Underwriters shall be obligated severally to take up and pay for (in the respective proportions which the principal amount of Securities set forth opposite their names in Schedule I hereto bears to the aggregate principal amount of Securities set forth opposite the names of all the remaining Underwriters) the Securities which the defaulting Underwriter or Underwriters agreed but failed to purchase; provided, however, that in the event that the aggregate principal amount of Securities which the defaulting Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of the aggregate principal amount of Securities set forth in Schedule I hereto, and arrangements reasonably satisfactory to the Representatives and the Transaction Entities are not otherwise made for the purchase of at least 90% of the Securities (by existing or new Underwriters) within 36 hours after any such defaults, the remaining Underwriters shall have the right to purchase all, but shall not be under any obligation to purchase any, of the Securities, and if such nondefaulting Underwriters do not purchase all the Securities, this Agreement will terminate without liability to any nondefaulting Underwriter or the Transaction Entities. In the event of a default by any Underwriter as set forth in this Section 9, the Closing Date shall be postponed for such period, not exceeding five business days, as the Representatives shall determine in order that the required changes in the Registration Statement, the General Disclosure Package and the Prospectus or in any other documents or arrangements may be effected. Nothing contained in this Agreement shall relieve any defaulting Underwriter of its liability, if any, to the Transaction Entities and any nondefaulting Underwriter for damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in the absolute discretion of the Representatives, by notice given to the Transaction Entities prior to delivery of and payment for the Securities, (a) if at any time prior to such time and after the date of this Agreement, (i) trading in the Company’s common stock or the Operating Partnership’s debt securities shall have been suspended or materially limited by the Commission or the NYSE or trading in securities generally on the NYSE shall have been suspended or limited or minimum or maximum prices shall have been established on such exchange, or maximum ranges of prices have
been required, by such exchange or by order of the Commission, (ii) a banking moratorium shall have been declared either by federal or New York State authorities or (iii) there shall have occurred any outbreak or escalation of hostilities, declaration by the United States of a national emergency or war, or other calamity or crisis or any change or development involving a prospective change in national or international political, financial or economic condition, the effect of which on financial markets is such as to make it, in the judgment of the Representatives, impractical or inadvisable to proceed with the offering or delivery of the Securities as contemplated by the General Disclosure Package and the Prospectus or (iv) if there has been, since the date hereof or since the respective dates as of which information is given in the Registration Statement, the Prospectus and the General Disclosure Package, a Material Adverse Effect, except as set forth in or contemplated in the Registration Statement, the General Disclosure Package and the Prospectus (for avoidance of doubt, excluding any documents incorporated or deemed to be incorporated by reference therein after the date hereof) or (b) as provided in Sections 6 and 9 hereof. Any such termination shall be without liability of any party to any other party except as provided in Section 7 hereof and except that Sections 1 and 8 hereof shall survive any such termination and remain in full force and effect.
11. Representations and Indemnities to Survive. The respective agreements, representations, warranties, indemnities and other statements of the Transaction Entities or any officer or representative of any of the Transaction Entities and of the Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or the Transaction Entities or any of their respective officers, directors, employees, agents or controlling persons referred to in Section 8 hereof, and will survive delivery of and payment for the Securities. The provisions of Sections 7 and 8 hereof shall survive the termination or cancellation of this Agreement.
12. No Fiduciary Relationship. The Transaction Entities acknowledge and agree that (i) the purchase and sale of the Securities pursuant to this Agreement is an arm’s-length commercial transaction between the Transaction Entities, on the one hand, and the Underwriters, on the other hand, (ii) in connection with the offering contemplated hereby and the process leading to such transaction, each Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of the Transaction Entities or their respective securityholders, creditors, employees or any other party, (iii) no Underwriter has assumed or will assume an advisory or fiduciary responsibility in favor of the Transaction Entities with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether such Underwriter has advised or is currently advising either Transaction Entity on other matters) and no Underwriter has any obligation to the Transaction Entities with respect to the offering contemplated hereby except the obligations expressly set forth in this Agreement, (iv) the Underwriters and their respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Transaction Entities, and (v) the Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to the transactions contemplated hereby and the Transaction Entities have consulted their own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.
13. Notices. All communications hereunder will be in writing and effective only on receipt, and, if sent to the Representatives, will be mailed to J.P. Morgan Securities LLC, 383 Madison Avenue, 3rd Floor, New York, New York 10179, attention of High Grade Syndicate Desk,
RBC Capital Markets, LLC at 200 Vesey Street, 8th Floor, New York, New York 10281, Attn: Debt Capital Markets or by emailing usdebtcapitalmarkets@rbccm.com, Merrill Lynch, Pierce, Fenner & Smith Incorporated, One Bryant Park, New York, NY 10036, Facsimile: (212) 901-7897, Attention: Legal Department and PNC Capital Markets LLC, Attn: Debt Capital Markets, 225 Fifth Ave, Floor 5, Pittsburgh, PA 15222; or, if sent to the Transaction Entities, will be delivered to Education Realty Trust, Inc., 999 South Shady Grove Road, Suite 600, Memphis, Tennessee 38120, Attention: Edwin B. Brewer, Jr. (facsimile: (901) 259-2594), with a copy to Morrison & Foerster LLP, 2000 Pennsylvania Avenue, NW, Suite 6000, Washington, DC 20006-1888, Attention: John A. Good (phone: (202) 887-1500; facsimile: (202) 887-0763).
14. Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors and the officers, directors, employees, agents and controlling persons referred to in Section 8 hereof, and no other person will have any right or obligation hereunder.
15. Applicable Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed within the State of New York.
16. Waiver of Jury Trial. The Transaction Entities and the Underwriters hereby irrevocably waive, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.
17. Counterparts. This Agreement may be signed in one or more counterparts (including by facsimile), each of which shall constitute an original and all of which together shall constitute one and the same agreement.
18. Headings. The section headings used herein are for convenience only and shall not affect the construction hereof.
[Signature Page Follows]
If the foregoing is in accordance with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof, whereupon this letter and your acceptance shall represent a binding agreement among the Company, the Operating Partnership and the several Underwriters.
Very truly yours,
EDUCATION REALTY TRUST, INC.
By: /s/Edwin B. Brewer, Jr.
Name: Edwin B. Brewer, Jr.
Title: Executive Vice President and Chief Financial
Officer
EDUCATION REALTY OPERATING PARTNERSHIP, LP
By: Education Realty OP GP, Inc., its general partner
By: /s/Edwin B. Brewer, Jr.
Name: Edwin B. Brewer, Jr.
Title: Executive Vice President and Chief Financial
Officer
|
| |
The foregoing Agreement is hereby confirmed and accepted as of the date first above written. | |
J.P. Morgan Securities LLC
RBC Capital Markets, LLC Merrill Lynch, Pierce, Fenner & Smith
Incorporated
PNC Capital Markets LLC
as Representative of the several Underwriters | |
|
| |
BY: J.P. Morgan Securities LLC
BY:/s/Som Bhattacharyya Name: Som Bhattacharyya Title: Vice President
| BY: RBC Capital Markets, LLC
BY:/s/Scott G. Primrose Name: Scott G. Primrose Title: Authorized Signatory
|
BY: Merrill Lynch, Pierce, Fenner & Smith
Incorporated
BY:/s/Shawn D. Cepeda Name: Shawn D. Cepeda Title: Managing Director
| BY: PNC Capital Markets LLC
BY:/s/Robert W. Thomas Name: Robert W. Thomas Title: Managing Director
|
SCHEDULE I
|
| | | | |
Underwriters | Principal Amount of
Securities
to be Purchased |
J.P. Morgan Securities LLC…………………………………… | $ | 50,000,000 |
| |
RBC Capital Markets, LLC………………………………….. | 50,000,000 |
| |
Merrill Lynch, Pierce, Fenner & Smith
Incorporated …………………………………….. | 37,500,000 |
| |
PNC Capital Markets LLC …………………………………… | 37,500,000 |
| |
Fifth Third Securities, Inc. …………………………………… | 18,750,000 |
| |
KeyBanc Capital Markets Inc. ………………………………… | 18,750,000 |
| |
Regions Securities LLC……………………………………….. | 18,750,000 |
| |
U.S. Bancorp Investments, Inc. ………………………………. | 18,750,000 |
| |
Total |
| $250,000,000 |
| |
Ex. B-1
ACTIVE 204185834v.9
EXHIBIT 3.1
EDUCATION REALTY TRUST, INC.
ARTICLES OF AMENDMENT
THIS IS TO CERTIFY THAT:
FIRST: The charter (the “Charter”) of Education Realty Trust, Inc., a Maryland corporation (the “Corporation”), is hereby amended to provide that, as of the Effective Time (as defined below), every three shares of common stock, $0.01 par value per share, of the Corporation which were issued and outstanding immediately prior to the Effective Time shall be changed into one issued and outstanding share of common stock, $0.03 par value per share, of the Corporation.
SECOND: The amendment to the Charter as set forth above has been duly approved by at least a majority of the entire Board of Directors as required by law. The amendment set forth herein is made without action by the stockholders of the Corporation, pursuant to Section 2-309(e) of the Maryland General Corporation Law.
THIRD: There has been no increase in the authorized shares of stock of the Corporation effected by the amendment to the Charter as set forth above.
FOURTH: These Articles of Amendment shall become effective at 8:00 a.m., Eastern Standard Time, on December 1, 2014.
FIFTH: The undersigned acknowledges these Articles of Amendment to be the corporate act of the Corporation and as to all matters or facts required to be verified under oath, the undersigned acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Corporation has caused these Articles of Amendment to be signed in its name and on its behalf by its Executive Vice President and Chief Financial Officer and attested to by its Senior Vice President, General Counsel and Secretary on this 25th day of November, 2014.
|
| |
ATTEST: | EDUCATION REALTY TRUST, INC. |
/s/ Elizabeth L. Keough Name: Elizabeth L. Keough Title: Senior Vice President, General Counsel and Secretary |
/s/ Edwin B. Brewer, Jr. (SEAL) Name: Edwin B. Brewer, Jr. Title: Executive Vice President and Chief Financial Officer |
EXHIBIT 3.2
EDUCATION REALTY TRUST, INC.
ARTICLES OF AMENDMENT
THIS IS TO CERTIFY THAT:
FIRST: The charter (the “Charter”) of Education Realty Trust, Inc., a Maryland corporation (the “Corporation”), is hereby amended to decrease the par value of the shares of common stock of the Corporation issued and outstanding immediately prior to the filing of these Articles of Amendment from $0.03 per share to $0.01 per share.
SECOND: The amendment to the Charter as set forth above has been duly approved by at least a majority of the entire Board of Directors as required by law. The amendment set forth herein is made without action by the stockholders of the Corporation, pursuant to Section 2-605(a)(2) of the Maryland General Corporation Law.
THIRD: There has been no increase in the authorized shares of stock of the Corporation effected by the amendment to the Charter as set forth above.
FOURTH: These Articles of Amendment shall become effective at 8:01 a.m., Eastern Standard Time, on December 1, 2014.
FIFTH: The undersigned acknowledges these Articles of Amendment to be the corporate act of the Corporation and as to all matters or facts required to be verified under oath, the undersigned acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties for perjury.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Corporation has caused these Articles of Amendment to be signed in its name and on its behalf by its Executive Vice President and Chief Financial Officer and attested to by its Senior Vice President, General Counsel and Secretary on this 25th day of November, 2014.
|
| |
ATTEST: | EDUCATION REALTY TRUST, INC. |
/s/ Elizabeth L. Keough Name: Elizabeth L. Keough Title: Senior Vice President, General Counsel and Secretary |
/s/ Edwin B. Brewer, Jr. (SEAL) Name: Edwin B. Brewer, Jr. Title: Executive Vice President and Chief Financial Officer |
EXHIBIT 4.1
FIRST SUPPLEMENTAL INDENTURE
Dated as of November 24, 2014
to
INDENTURE
Dated as of November 7, 2014
Among
Education Realty Operating Partnership, LP, as Issuer
Education Realty Trust, Inc., as Guarantor
and
U.S. Bank National Association, as Trustee
| |
ARTICLE I | DEFINITIONS ......................................................................................1 |
| |
Section 1.1 | Certain Terms Defined in the Indenture.....................................1 |
| |
Section 1.2 | Definitions ..................................................................................................2 |
| |
ARTICLE II | CREATION OF SECURITIES..............................................................5 |
Section 2.1 Creation of the Securities...........................................................5
Section 2.2 Form of the Securities................................................................6
Section 2.3 Terms and Conditions of the Securities.....................................6
| |
ARTICLE III | CERTAIN COVENANTS.....................................................................6 |
| |
Section 3.1 | Limitation on Indebtedness.......................................................6 |
| |
Section 3.2 | Limitation on Secured Debt......................................................7 |
| |
Section 3.3 | Maintenance of Unencumbered Assets.....................................7 |
| |
Section 3.4 | Debt Service Test.......................................................................7 |
| |
ARTICLE IV | MISCELLANEOUS..............................................................................8 |
| |
Section 4.1 | Relationship with Indenture.......................................................8 |
| |
Section 4.2 | Trust Indenture Act Controls......................................................9 |
| |
Section 4.3 | Governing Law...........................................................................9 |
| |
Section 4.4 | Multiple Counterparts................................................................9 |
| |
Section 4.5 | Severability................................................................................9 |
| |
Section 4.6 | Ratification................................................................................9 |
| |
Section 4.7 | Headings..................................................................................10 |
| |
Section 4.8 | Effectiveness............................................................................10 |
FIRST SUPPLEMENTAL INDENTURE
This First Supplemental Indenture, dated as of November 24, 2014 (this “First Supplemental Indenture”), among Education Realty Operating Partnership, LP, a Delaware limited partnership (the “Operating Partnership”), Education Realty Trust, Inc., a Maryland corporation, as guarantor (the “Guarantor”), and U.S. Bank National Association, as trustee (the Trustee”), supplements that certain Indenture, dated as of November 7, 2014, among the Operating Partnership, the Guarantor and the Trustee (the “Original Indenture” and together with the First Supplemental Indenture, the “Indenture”).
RECITALS OF THE OPERATING PARTNERSHIP AND THE GUARANTOR
WHEREAS, the Operating Partnership has duly authorized the execution and delivery of the Original Indenture to provide for the issuance from time to time of its senior debentures, notes or other evidences of indebtedness (the “Securities”), unlimited as to principal amount and which will be guaranteed by the Guarantor, to bear such fixed or floating rates of interest, to mature at such time or times, to be issued in one or more series and to have such other provisions as provided for in the Indenture;
WHEREAS, the Original Indenture provides that the Securities shall be in the form as may be established by or pursuant to a Board Resolution and set forth in an Officers’ Certificate or as may be established in one or more supplemental indentures thereto, in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by the Original Indenture; and
WHEREAS, the parties are entering into this First Supplemental Indenture to (i) create a series of debt securities to be issued from time to time in an unlimited principal amount entitled “4.600% Senior Notes due 2024” (the “Notes”); and (ii) establish the form and the terms and conditions of such Notes.
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises stated herein, the parties hereto hereby enter into this First Supplemental Indenture, for the equal and proportionate benefit of all Holders of the Securities, as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Certain Terms Defined in the Indenture.
For purposes of this First Supplemental Indenture, all capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Indenture, as amended and supplemented hereby.
Section 1.2 Definitions.
For all purposes of this First Supplemental Indenture:
“Acquired Indebtedness” means Indebtedness of a Person (1) existing at the time such Person is merged or consolidated with or into, or becomes a Subsidiary of, the Operating Partnership, or (2) assumed by the Operating Partnership or any of its Subsidiaries in connection with the acquisition of assets from such Person. Acquired Indebtedness shall be deemed to be Incurred on the date the acquired Person is merged or consolidated with or into, or becomes a Subsidiary of, the Operating Partnership or the date of the related acquisition, as the case may be.
“Closing Date” means November 24, 2014.
“Consolidated Financial Statements” means, with respect to any Person, collectively, the consolidated financial statements and notes to those financial statements of that Person and its subsidiaries determined on a consolidated basis in accordance with GAAP.
“Consolidated Income Available for Debt Service” means, for any period of time, the Consolidated Net Income of the Operating Partnership for such period, plus amounts which have been deducted and minus amounts which have been added for, without duplication:
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(1) | Interest Expense on Indebtedness; |
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(2) | provision for taxes based on income; |
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(3) | depreciation and amortization; |
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(5) | non-cash, non-recurring items, as determined by the Operating Partnership in good faith; and |
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(6) | provision for gains and losses on sales or other dispositions of properties and other investments |
In each case for such period, the Operating Partnership will reasonably determine amounts in accordance with GAAP, except to the extent GAAP is not applicable with respect to the determination of non-cash and non-recurring items.
“Consolidated Net Income” means, for any period of time, the amount of net income, or loss, for the Operating Partnership and its Subsidiaries for such period determined on a consolidated basis in accordance with GAAP.
“Consolidated Subsidiary” means each Subsidiary of the Operating Partnership that is consolidated in the Operating Partnership’s Consolidated Financial Statements.
“DTC” means the Depositary Trust Company, a New York corporation.
“GAAP” means generally accepted accounting principles in the United States of America as in effect on the date of any required calculation or determination.
“Global Note” means a single fully-registered global note in book entry form, without coupons, substantially in the form of Exhibit A attached hereto.
“Incur” means, with respect to any Indebtedness or other obligation of any Person, to create, assume, guarantee or otherwise become liable in respect of the Indebtedness or other obligation, and “Incurrence” and “Incurred” have meanings correlative to the foregoing. Indebtedness or other obligation of the Operating Partnership or any Consolidated Subsidiary of the Operating Partnership will be deemed to be Incurred by the Operating Partnership or such Subsidiary whenever the Operating Partnership or such Consolidated Subsidiary shall create, assume, guarantee or otherwise become liable in respect thereof. Indebtedness or other obligation of a Subsidiary of the Operating Partnership existing prior to the time it became a Subsidiary of the Operating Partnership will be deemed to be Incurred upon such Subsidiary becoming a Subsidiary of the Operating Partnership; and Indebtedness or other obligation of a Person existing prior to a merger or consolidation of such Person with the Operating Partnership or any Subsidiary of the Operating Partnership in which such Person is the successor to the Operating Partnership or such Subsidiary will be deemed to be Incurred upon the consummation of such merger or consolidation. Any issuance or transfer of capital stock that results in Indebtedness constituting Intercompany Indebtedness being held by a Person other than the Operating Partnership, the Guarantor or any Subsidiary or any sale or other transfer of any Indebtedness constituting Intercompany Indebtedness to a Person that is not the Operating Partnership, the Guarantor or any Subsidiary, will be deemed, in each case, to be an Incurrence of Indebtedness that is not Intercompany Indebtedness at the time of such issuance, transfer or sale, as the case may be.
“Indebtedness” of the Operating Partnership, the Guarantor or any Consolidated Subsidiary means, without duplication, any of the Operating Partnership’s indebtedness or that of the Guarantor or any Consolidated Subsidiary, whether or not contingent, in respect of: (a) borrowed money evidenced by bonds, notes, debentures or similar instruments whether or not such indebtedness is secured by any lien existing on property owned by the Operating
Partnership, the Guarantor or any Consolidated Subsidiary; (b) indebtedness for borrowed money of a Person other than the Operating Partnership, the Guarantor or a Consolidated Subsidiary which is secured by any lien on property owned by the Operating Partnership, the Guarantor or any Consolidated Subsidiary, to the extent of the lesser of (i) the amount of indebtedness so secured, and (ii) the fair market value of the property subject to such lien; (c) the reimbursement obligations, contingent or otherwise, in connection with any letters of credit actually issued or amounts representing the balance deferred and unpaid of the purchase price of any property or services, except any such balance that constitutes an accrued expense or trade payable; or (d) any lease of property by the Operating Partnership, the Guarantor or any Consolidated Subsidiary as lessee which is reflected on the Guarantor’s consolidated balance sheet as a capitalized lease in accordance with GAAP, to the extent, in the case of indebtedness under (a) through (c) above, that any such items (other than letters of credit) would appear as a liability on the Guarantor’s consolidated balance sheet in accordance with GAAP. Indebtedness also includes, to the extent not otherwise included, any obligation by the Operating Partnership, the Guarantor or any Consolidated Subsidiary to be liable for, or to pay, as obligor, guarantor or otherwise (other than for purposes of collection in the ordinary course of business), indebtedness of another Person (other than the Operating Partnership, the Guarantor or any Consolidated Subsidiary) of the type described in clauses (a)-(d) of this definition.
“Intercompany Indebtedness” means Indebtedness to which the only parties are any of the Operating Partnership, the Guarantor and any Consolidated Subsidiary; provided, however, that with respect to any such Indebtedness of which the Operating Partnership or the Guarantor is the borrower, such Indebtedness is subordinate in right of payment to the Notes.
“Interest Expense” means, for any period of time, the maximum amount payable for interest on, and original issue discount of, the Operating Partnership and its Consolidated Subsidiaries’ Indebtedness, determined in accordance with GAAP.
“Make Whole Amount” means the sum of the present values of the remaining scheduled payments of principal of and interest on the Notes to be redeemed that would be due after the related Redemption Date but for such redemption (for the avoidance of doubt, exclusive of any unpaid interest accrued thereon to, but not including, such Redemption Date), discounted to the related Redemption Date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 35 basis points.
“Secured Debt” means, as of any date, that portion of principal amount of outstanding Indebtedness, excluding Intercompany Indebtedness, of the Operating Partnership and its Consolidated Subsidiaries as of that date that is secured by a mortgage, trust deed, deed of trust, deeds to secure Indebtedness, pledge, security interest, assignment for collateral purposes, deposit arrangement, or other security agreement, 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 any other like agreement granting or conveying a security interest.
“Statistical Release” means the statistical release designated “H.15(519)” or any successor publication which is published weekly by the Federal Reserve System and which establishes yields on actively traded United States government securities adjusted to constant maturities, or, if such statistical release is not published at the time of any determination under the Indenture, then such other reasonably comparable index designated by the Operating Partnership.
“Total Assets” means, as of any time, the sum of, without duplication, Undepreciated Real Estate Assets and all other assets, excluding accounts receivable and (non-real estate) intangibles of the Operating Partnership and its Consolidated Subsidiaries, all determined in accordance with GAAP.
“Total Unencumbered Assets” means, as of any time, the sum of, without duplication, those Undepreciated Real Estate Assets which are not subject to a lien securing Indebtedness and all other assets, excluding accounts receivable and intangibles, of the Operating Partnership and its Consolidated Subsidiaries not subject to a lien securing Indebtedness, all determined in accordance with GAAP; provided, however, that all investments by the Operating Partnership or its Consolidated Subsidiaries in unconsolidated joint ventures, unconsolidated limited partnerships, unconsolidated limited liability companies and other nonconsolidated entities shall be excluded from Total Unencumbered Assets to the extent that such investments would have otherwise been included.
“Treasury Rate” means the arithmetic mean of the yields under the respective heading “Week Ending” published in the most recent Statistical Release under the caption “Treasury Constant Maturities” for the maturity (rounded to the nearest month) corresponding to the remaining life to maturity, as of the payment date, of the principal of the Notes being redeemed or paid. If no maturity exactly corresponds to such maturity, yields for the two published maturities most closely corresponding to such maturity shall be calculated pursuant to the immediately preceding sentence and the Treasury Rate shall be interpolated or extrapolated from such yields on a straight-line basis, rounding in each of such relevant periods to the nearest month. For the purposes of calculating the Treasury Rate, the most recent Statistical Release published prior to the date of determination of the Redemption Price shall be used.
“Undepreciated Real Estate Assets” means, as of any time, the cost (original cost plus capital improvements) of the real estate assets of the Operating Partnership and its Consolidated Subsidiaries on such date, before depreciation and amortization, all determined in accordance with GAAP.
“Unsecured Debt” means that portion of the outstanding principal amount of the Operating Partnership’s and its Consolidated Subsidiaries’ Indebtedness, excluding Intercompany Indebtedness, that is not Secured Debt.
ARTICLE II
CREATION, FORM AND TERMS AND CONDITIONS OF THE NOTES
Section 2.1 Creation of the Securities. In accordance with Section 301 of the Original Indenture, the Operating Partnership hereby creates the Notes as a separate series of its debt securities issued pursuant to the Indenture. The Notes shall be issued in an aggregate principal amount initially limited to $250,000,000.
The Operating Partnership may, from time to time, without notice to or the consent of the Holders of the Notes, issue, in addition to the Notes originally issued on the Closing Date, additional Notes. The Notes originally issued on the Closing Date and any additional Notes originally issued subsequent to the Closing Date shall be a single series for all purposes under the Indenture.
Section 2.2 Form of the Securities. The Notes will be represented by one or more fully-registered Global Notes in book-entry form, without coupons, registered in the name of the nominee of DTC, as the Depositary, or its nominee. The Global Notes shall be in the form of Exhibit A attached hereto and the terms set forth in such form shall be incorporated herein. So long as DTC or its nominee is the registered owner of a Global Note, DTC or its nominee, as the case may be, will be considered the sole owner or holder of the Notes represented by such Global Note for all purposes under the Indenture. Ownership of beneficial interests in a Global Note will be shown on, and transfers thereof will be effected only through, records maintained by the Trustee (with respect to beneficial interests of participants) or by participants or persons that hold interests through participants (with respect to beneficial interests of beneficial owners).
Section 2.3 Terms and Conditions of the Securities. The Notes shall be governed by all the terms and conditions of the Original Indenture, as supplemented by this First Supplemental Indenture, and in particular, the following provisions shall be the terms of the Notes:
(1) Optional Redemption. At any time prior to September 1, 2024, the Operating Partnership may, at its option, redeem the Notes, in whole at any time or in part from time to time, in each case upon notice at least 30 days but not more than 60 days prior to the Redemption Date fixed by the Operating Partnership, at a Redemption Price equal to the greater of (1) 100% of the principal amount of the Notes to be redeemed or (2) the Make Whole Amount, plus in each case unpaid interest, if any, accrued to, but not including, such Redemption Date.
In addition, at any time on or after September 1, 2024, the Operating Partnership may, at its option, redeem the Notes prior to maturity, in whole at any time or in part (in authorized
denominations) from time to time, at a Redemption Price equal to 100% of the principal amount of the Notes to be redeemed plus unpaid interest, if any, accrued to, but not including, the related Redemption Date.
(2) Maturity; Payment of Principal and Interest. The principal amount of the Notes shall be payable on December 1, 2024, subject to the provisions of the Indenture and the Notes. Interest on the Notes will accrue from and including November 24, 2014. The Notes will bear interest at a rate of 4.600% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on June 1, 2015. Principal and interest payments on interests represented by a Global Note will be made to DTC or its nominee, as the case may be, as the registered owner of such Global Note. All payments of principal and interest in respect of the Global Note will be made by the Operating Partnership in immediately available funds. The principal of the Notes payable on the Maturity Date or upon redemption will be paid against presentation and surrender of the Notes at the corporate trust office of the Trustee at 6810 Crumpler Blvd., Suite 200, Olive Branch, Mississippi 38654, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public or private debt.
ARTICLE III
CERTAIN COVENANTS
In addition to the covenants set forth in Article 10 of the Original Indenture, there are established the following covenants for the benefit of Holders of the Notes but not, unless expressly agreed by the Operating Partnership in writing, any other series of Securities issued before, on or subsequent to the date hereof:
Section 3.1 Limitation on Indebtedness.
The Operating Partnership will not, and will not permit any of its Subsidiaries to, Incur any Indebtedness, other than Intercompany Indebtedness and guarantees of Indebtedness Incurred by the Operating Partnership or any of its Subsidiaries in compliance with the Indenture, if, immediately after giving effect to the Incurrence of such Indebtedness and the application of the proceeds thereof, the aggregate principal amount of the Operating Partnership’s and its Subsidiaries’ Indebtedness, excluding Intercompany Indebtedness and guarantees of Indebtedness Incurred by the Operating Partnership’s or any of its Subsidiaries in compliance with the Indenture, would be greater than 60% of the sum of, without duplication:
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(1) | Total Assets as of the end of the fiscal quarter covered in the Operating Partnership’s annual or quarterly report most recently furnished to Holders of the Notes or filed with the Commission, as the case may be; and |
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(2) | the purchase price of any real estate assets or mortgages receivable acquired, and the amount of any securities offering proceeds received (to the extent that such proceeds were not used to acquire real estate assets or mortgages receivable or used to reduce Indebtedness), by the Operating Partnership or any of its Subsidiaries since the end of the relevant fiscal quarter, including those proceeds obtained in connection with the incurrence of such additional Indebtedness. |
Section 3.2 Limitation on Secured Debt.
In addition to the limitation on the Incurrence of Indebtedness set forth in Section 3.1 above, the Operating Partnership will not, and will not permit any of its Subsidiaries to, Incur any Secured Debt, other than Intercompany Indebtedness and guarantees of Secured Debt Incurred by the Operating Partnership or any of its Subsidiaries in compliance with the Indenture, if, immediately after giving effect to the Incurrence of such Secured Debt and the application of the proceeds thereof, the aggregate principal amount of Secured Debt would be greater than 40% of the sum of, without duplication:
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(2) | Total Assets as of the end of the fiscal quarter covered in the Operating Partnership’s annual or quarterly report most recently furnished to Holders of the Notes or filed with the Commission, as the case may be; and |
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(3) | the purchase price of any real estate assets or mortgages receivable acquired, and the amount of any securities offering proceeds received (to the extent that such proceeds were not used to acquire real estate assets or mortgages receivable or used to reduce Indebtedness), by the Operating Partnership or any of its Subsidiaries since the end of the relevant fiscal quarter, including those proceeds obtained in connection with the incurrence of such additional Indebtedness. |
Section 3.3 Maintenance of Unencumbered Assets.
The Operating Partnership will, and will cause its Subsidiaries to, have at all times Total Unencumbered Assets of not less than 150% of the Operating Partnership’s total Unsecured Debt determined on a consolidated basis in accordance with GAAP.
Section 3.4 Debt Service Test.
In addition to the limitations set forth in Sections 3.1 and 3.2 above, the Operating Partnership will not, and will not permit any of its Subsidiaries to, Incur any Indebtedness, other than Intercompany Indebtedness and guarantees of Indebtedness Incurred by the Operating Partnership or any of its Subsidiaries in accordance with the Indenture, if the ratio of Consolidated Income Available for Debt Service to Interest Expense for the period consisting of the four consecutive fiscal quarters most recently ended prior to the date on which the additional
Indebtedness is to be incurred shall have been less than 1.5:1 on a pro forma basis after giving effect to the incurrence of that Indebtedness and the application of the proceeds therefrom, and calculated on the following assumptions:
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(1) | such Indebtedness and any other Indebtedness Incurred by the Operating Partnership and its Subsidiaries since the first day of the relevant four-quarter period and the application of the proceeds therefrom, including to refinance other Indebtedness, had occurred on the first day of such period; |
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(2) | the repayment or retirement of any Indebtedness (other than Indebtedness repaid or retired with the proceeds of any other Indebtedness, which repayment or retirement shall be calculated pursuant to the foregoing clause (1) and not this clause (2)) by the Operating Partnership and its Subsidiaries since the first day of the relevant four-quarter period had been repaid or retired on the first day of such period (except that, in making such computation, the amount of Indebtedness under any revolving credit facility shall be computed based upon the average daily balance of such Indebtedness during such period); |
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(3) | in the case of Acquired Indebtedness or Indebtedness Incurred in connection with any acquisition since the first day of the relevant four-quarter period, the related acquisition had occurred as of the first day of such period with the appropriate adjustments with respect to such acquisition being included in such pro forma calculation; and |
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(4) | in the case of any acquisition or disposition of any asset or group of assets or the placement of any assets in service or removal of any assets from service by the Operating Partnership or any of its Subsidiaries from the first day of the relevant four-quarter period to the date of determination, including, without limitation, by merger, or stock or asset purchase or sale, the acquisition, disposition, placement in service or removal from service had occurred as of the first day of such period with appropriate adjustments with respect to the acquisition, disposition, placement in service or removal from service being included in that pro forma calculation. |
ARTICLE IV
MISCELLANEOUS
Section 4.1 Relationship with Indenture.
The terms and provisions contained in the Original Indenture will constitute, and are hereby expressly made, a part of this First Supplemental Indenture. However, to the extent any
provision of the Original Indenture conflicts with the express provisions of this First Supplemental Indenture, the provisions of this First Supplemental Indenture will govern and be controlling.
Section 4.2 Trust Indenture Act Controls.
If any provision of this First Supplemental Indenture limits, qualifies or conflicts with another provision which is required to be included in this First Supplemental Indenture by the Trust Indenture Act, the required provision shall control. If any provision of this First Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act which may be so modified or excluded, the latter provision shall be deemed to apply to this First Supplemental Indenture as so modified or to be excluded, as the case may be.
Section 4.3 Governing Law.
This First Supplemental Indenture shall be governed by, and construed in accordance with, the laws of the State of New York without regard to conflicts of law principles of such State other than New York General Obligations Law Section 5-1401.
Section 4.4 Multiple Counterparts.
The parties may sign multiple counterparts of this First Supplemental Indenture. Each signed counterpart shall be deemed an original but all of them together represent one and the same First Supplemental Indenture.
Section 4.5 Severability.
Each provision of this First Supplemental Indenture shall be considered separable and if for any reason any provision which is not essential to the effectuation of the basic purpose of this First Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and a Holder shall have no claim therefor against any party hereto.
Section 4.6 Ratification.
The Original Indenture, as supplemented and amended by this First Supplemental Indenture, is in all respects ratified and confirmed. The Original Indenture and this First Supplemental Indenture shall be read, taken and construed as one and the same instrument. All provisions included in this First Supplemental Indenture supersede any conflicting provisions included in the Original Indenture unless not permitted by law. The Trustee accepts the trusts created by the Original Indenture, as supplemented by this First Supplemental Indenture, and agrees to perform the same upon the terms and conditions of the Indenture, as supplemented by
this First Supplemental Indenture. The recitals and statements contained herein shall be taken as the statements of the Operating Partnership, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this First Supplemental Indenture.
Section 4.7 Headings.
The Section headings in this First Supplemental Indenture are for convenience only and shall not affect the construction thereof.
Section 4.8 Effectiveness.
The provisions of this First Supplemental Indenture shall become effective as of the date hereof.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed all as of the day and year first above written.
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EDUCATION REALTY OPERATING
PARTNERSHIP, LP, as Issuer By: EDUCATION REALTY OP GP, INC.,
its general partner By: EDUCATION REALTY TRUST, INC.,
its sole owner
By:/s/ Edwin B. Brewer, Jr.
Name: Edwin B. Brewer, Jr. Title: Executive Vice President and Chief Financial Officer
EDUCATION REALTY TRUST, INC.,
as Guarantor
By: /s/ Edwin B. Brewer, Jr.
Name: Edwin B. Brewer, Jr. Title: Executive Vice President and Chief Financial Officer |
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IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be duly executed all as of the day and year first above written.
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U.S. BANK NATIONAL ASSOCIATION,
as Trustee, Registrar, Paying Agent and Transfer Agent By: /s/ Gail Wilson
Name: Gail Wilson Title: Vice President
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EXHIBIT 4.2
THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITARY OR CEDE & CO., AS NOMINEE OF THE DEPOSITARY. THIS NOTE IS EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY, BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH A SUCCESSOR DEPOSITARY.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TO THE OPERATING PARTNERSHIP OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND SUCH SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
EDUCATION REALTY OPERATING PARTNERSHIP, LP
4.600% Senior Note due 2024
REGISTERED PRINCIPAL AMOUNT: $250,000,000
No. R-1
CUSIP: 28140T AA6
ISIN: US28140TAA60
EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership (the “Operating Partnership”), which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal amount of TWO HUNDRED AND FIFTY MILLION DOLLARS ($250,000,000) on December 1, 2024 (the “Stated Maturity Date”) (unless redeemed on any date fixed for redemption (the “Redemption Date”) prior to the Stated Maturity Date in accordance with the terms of this Note and the Indenture) (the Stated Maturity Date and the Redemption Date is hereinafter referred to as the “Maturity Date” with respect to the principal repayable on such date) and to pay interest on the outstanding principal amount of this Note from and including November 24, 2014, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, and will be payable semi-annually in arrears on June 1 and December 1 of each year, commencing on June 1,
2015 (each, an “Interest Payment Date”), and, if applicable, on the Maturity Date, at the rate of 4.600% per annum, until said principal amount is paid or duly provided for. Interest on this Note will be computed on the basis of a 360-day year consisting of twelve 30-day months.
Payment of Interest. The interest so payable and any Additional Amounts with respect to this Note which will be payable, and are punctually paid or duly provided for, on any Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on the May 15 or November 15, whether or not a Business Day, as defined in the Indenture, as the case may be, immediately preceding such Interest Payment Date (the “Regular Record Date”). Any such interest or Additional Amount not punctually paid or duly provided for on an Interest Payment Date (“Defaulted Interest”) will forthwith cease to be payable to the Holder on such Regular Record Date, and such Defaulted Interest may be paid to the Person in whose name this Note (or one or more Predecessor Notes) is registered at the close of business on a special record date (the “Special Record Date”) for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to the Holder of this Note not less than 10 days prior to such Special Record Date, or may be paid at any time in any other lawful manner, all as more fully provided in the Indenture.
Optional Redemption. The provisions of Article Eleven of the Indenture shall apply to this Note, as supplemented or amended by the following paragraphs.
At any time prior to September 1, 2024, the Operating Partnership may, at its option, redeem this Note, in whole at any time or in part from time to time, in each case upon notice at least 30 days but not more than 60 days prior to the Redemption Date fixed by the Operating Partnership, at a Redemption Price equal to the greater of (1) 100% of the principal amount of this Notes to be redeemed or (2) the Make Whole Amount, plus in each case unpaid interest, if any, accrued to, but not including, the applicable Redemption Date. In addition, at any time on or after September 1, 2024 (in authorized denominations), the Operating Partnership may, at its option, redeem this Note prior to maturity, in whole at any time or in part from time to time, at a Redemption Price equal to 100% of the principal amount of this Note to be redeemed plus unpaid interest, if any, accrued to, but not including, the applicable Redemption Date.
In the case of any partial redemption of this Note, selection of the Holders subject to such partial redemption will be made by the Trustee pro rata, by lot or by such method as the Trustee in its sole discretion deems fair and appropriate, in accordance with methods generally used at the time of selection by fiduciaries in similar circumstances. A new Note in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of this Note.
“Make Whole Amount” means the sum of the present values of the remaining scheduled payments of principal of and interest on this Notes to be redeemed that would be due after the applicable Redemption Date but for such redemption (for the avoidance of doubt, exclusive of any unpaid interest accrued thereon to, but not including, such Redemption Date), discounted to the related Redemption Date on a semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 35 basis points.
“Treasury Rate” means the arithmetic mean of the yields under the respective heading “Week Ending” published in the most recent Statistical Release under the caption “Treasury Constant Maturities” for the maturity (rounded to the nearest month) corresponding to the remaining life to maturity, as of the Redemption Date, of the principal of this Note being redeemed or paid. If no maturity exactly corresponds to such maturity, yields for the two published maturities most closely corresponding to such maturity shall be calculated pursuant to the immediately preceding sentence and the Treasury Rate shall be interpolated or extrapolated from such yields on a straight-line basis, rounding in each of such relevant periods to the nearest month. For the purposes of calculating the Treasury Rate, the most recent Statistical Release published prior to the date of determination of the Redemption Price shall be used.
“Statistical Release” means the statistical release designated “H.15(519)” or any successor publication which is published weekly by the Federal Reserve System and which establishes yields on actively traded United States government securities adjusted to constant maturities, or, if such statistical release is not published at the time of any determination under the Indenture, then such other reasonably comparable index designated by the Operating Partnership.
Place of Payment. The Operating Partnership will make payment of principal of, and premium, if any, and interest on, this Note in immediately available funds at the Corporate Trust Office of the Trustee or such other Office or Agency as may be designated by the Operating Partnership for such purpose in The City of New York, in Dollars.
Time of Payment. If an Interest Payment Date or the Maturity Date falls on a day that is not a Business Day, the required payment need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on such Interest Payment Date or the Maturity Date, as the case may be, and no additional interest shall accrue on such payment as a result of payment on such next succeeding Business Day.
General. This Note is one of a duly authorized issue of Securities of the Operating Partnership, issued and to be issued in one or more series under an indenture (the “Base Indenture”), dated as of November 7, 2014, among the Operating Partnership, Education Realty Trust, Inc., as guarantor (the “Guarantor”), and U.S. Bank National Association, as trustee (the “Trustee,” which term includes any successor trustee under the Indenture with respect to the series of Securities of which this Note is a part), as supplemented by a First Supplemental Indenture thereto, dated as of November 24, 2014 (the “First Supplemental Indenture,” and together with the Base Indenture, the “Indenture”), among the Operating Partnership, the Guarantor and the Trustee. Reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, obligations, duties and immunities thereunder of the Operating Partnership, the Guarantor, the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Note is one of a duly authorized series of Securities designated as “4.600% Senior Notes due 2024” (collectively, the “Notes”), limited, except as specified below, in aggregate principal amount to TWO HUNDRED AND FIFTY MILLION DOLLARS ($250,000,000). To the extent the terms of this Note conflict with the terms of the Indenture, the terms of this Note shall govern.
Further Issuance. The Operating Partnership may, from time to time, without notice to, or the consent of, the Holder of this Note, increase the principal amount of the series of Notes and issue and sell such additional Securities (“Additional Securities”) ranking equally and ratably with, and having the same interest rate, maturity and other terms as, the originally issued Notes (other than the date of issuance and, under certain circumstances, the date from which interest thereon will begin to accrue and the initial Interest Payment Date). Any such Additional Securities will be consolidated, and constitute a single series of Securities, with the originally issued Notes for all purposes; provided, however, that any such Additional Securities that have the same CUSIP, ISIN or other identifying number of any Outstanding Notes must be fungible with such Outstanding Notes for U.S. federal income tax purposes.
Events of Default. If an Event of Default with respect to this Note shall have occurred and be continuing, the principal of this Note may be declared, and in certain cases shall automatically become, due and payable in the manner and with the effect provided in the Indenture.
Sinking Fund. This Note is not subject to, or entitled to the benefits of, any sinking fund.
Satisfaction and Discharge. The Indenture contains provisions where, upon the Operating Partnership’s direction and satisfaction of certain conditions, the Indenture shall cease to be of further effect with respect to this Note, subject to the survival of specified provisions of the Indenture.
Defeasance and Covenant Defeasance. This Note will be subject to defeasance and covenant defeasance as set forth in the Indenture.
Modification and Waivers; Obligations of the Operating Partnership Absolute. The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Operating Partnership and the Guarantor and the rights of the Holders of the Securities. Such amendment and modification may be effected under the Indenture at any time by the Operating Partnership, the Guarantor and the Trustee with the consent of the Holders of a majority in aggregate principal amount of the Outstanding Securities of each series affected thereby (voting as separate classes). The Indenture also contains provisions permitting the Holders of a majority in aggregate principal amount of the Outstanding Securities of any series, on behalf of the Holders of all Outstanding Securities of such series, to waive compliance by the Operating Partnership with certain provisions of the Indenture. Furthermore, provisions in the Indenture permit the Holders of a majority in aggregate principal amount of the Outstanding Securities of any series to waive, on behalf of the Holders of all Outstanding Securities of such series, any continuing defaults under the Indenture and their consequences. Any such consent or waiver in respect of this Note shall be conclusive and binding upon the Holder of this Note and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note.
No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Operating Partnership, which is absolute and unconditional, to pay the principal of,
and premium, if any, and interest on, this Note at the time, place, and rate, and in the coin or currency, herein prescribed.
Registration of Transfer or Exchange. As provided in the Indenture and subject to certain limitations herein and therein set forth, the transfer of this Note is registrable in the register of this Note maintained by the Security Registrar upon surrender of this Note for registration of transfer, at the Office or Agency in any Place of Payment, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Operating Partnership and the Security Registrar duly executed by, the Holder hereof or his or her attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.
As provided in the Indenture and subject to certain limitations herein and therein set forth, this Note is exchangeable for a like aggregate principal amount of Notes of different authorized denominations, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or exchange, or any redemption or repayment of outstanding securities, but the Operating Partnership may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the Operating Partnership, the Guarantor, the Trustee and any agent of the Operating Partnership, the Guarantor or the Trustee may treat the Holder as the owner hereof for all purposes, whether or not this Note be overdue, and none of the Operating Partnership, the Guarantor, the Trustee or any such agent shall be affected by notice to the contrary.
Guarantee. Payment of this Note is fully and unconditionally guaranteed by the Guarantor pursuant to the Guarantee issued pursuant to the Base Indenture.
Defined Terms. All terms used but not defined in this Note shall have the meanings assigned to them in the Indenture.
Governing Law. The Indenture and this Note shall be governed by, and construed in accordance with, the laws of the State of New York without regard to conflicts of law principles of such State other than New York General Obligations Law Section 5-1401. EACH OF THE OPERATING PARTNERSHIP, THE GUARANTOR AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THE INDENTURE, THIS NOTE, THE GUARANTEE OR THE TRANSACTION CONTEMPLATED HEREBY.
Unless the certificate of authentication hereon has been executed by the Trustee by manual signature, this Note shall not be entitled to any benefit under the Indenture (including the Guarantee) or be valid or obligatory for any purpose.
Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Operating Partnership has caused a “CUSIP” number to be printed on this Note as a convenience to the Holder of this Note. No representation is made as to the correctness or accuracy of such CUSIP number, or the ISIN number, printed on this Note, and reliance may be placed only on the other identification numbers printed hereon.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the Operating Partnership has caused this Note to be duly executed by duly authorized signatories.
Dated: November 24, 2014
EDUCATION REALTY OPERATING PARTNERSHIP, LP
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By: | Education Realty OP GP, Inc., its general partner |
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By: | Education Realty Trust, Inc., its sole owner |
By: /s/ Edwin B. Brewer, Jr.
Edwin B. Brewer, Jr.
Executive Vice President and Chief Financial Officer
By: /s/J. Drew Koester
J. Drew Koester
Senior Vice President and Chief Accounting Officer
TRUSTEE’S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: /s/ Gail Wilson
Name: Gail Wilson
Title: Vice President
Dated: November 24, 2014
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY NUMBER OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
(Please print or typewrite name and address,
including postal zip code, of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes and appoints
to transfer said Note on the books of the Trustee, with full power of substitution in the premises.
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Dated: | NOTICE: The signature to this assignment must correspond with the name as written upon the face of the within Note in every particular, without alteration or enlargement or any change whatsoever. |
Signature Guarantee |
EXHIBIT 4.3
GUARANTEE
This guarantee (this “Guarantee”) dated November 24, 2014 is entered into by Education Realty Trust, Inc., 999 South Shady Grove Road, Suite 600, Memphis, Tennessee 38120 (the “Guarantor”).
Whereas,
(A) Education Realty Operating Partnership, LP, a Delaware limited partnership (the “Issuer”), is the issuer under the Indenture, dated as of November 7, 2014, among the Issuer, the Guarantor and U.S. Bank National Association, as trustee (the “Base Indenture”), as supplemented by a First Supplemental Indenture thereto, dated as of November 24, 2014 (the Base Indenture, as so supplemented, the “Indenture”), which provides for the issuance from time to time of the Issuer’s senior debentures, notes or other evidences of indebtedness (hereinafter called the “Securities”), unlimited as to principal amount and which will be guaranteed by the Guarantor.
(B) The Guarantor has agreed, under Section 1601 of the Indenture, to issue this Guarantee in respect of all of the Securities issued pursuant to the Indenture to each Holder (as defined in the Indenture) of the Securities.
(C) This Guarantee may be modified in accordance with the terms of the Indenture.
Now, therefore the Guarantor undertakes as follows:
Terms defined in or for the purposes of the Indenture and/or the Securities shall have the same meaning in this Guarantee (including the Recitals), except where the context requires otherwise or where a different meaning is attributed to the relevant terms. Any references herein to any amounts payable, howsoever described, in respect of Securities issued by the Issuer shall include any amounts payable by the Issuer under or in connection with the Indenture.
The Guarantor, in accordance with the terms hereof, as primary obligor and not merely as a surety, irrespective of the validity and the legal effects of the Securities, irrespective of restrictions of any kind on the Issuer’s performance of its obligations under the Securities, and waiving all rights of objection and defense arising from the Securities, hereby irrevocably and unconditionally guarantees to the Holders, the due and punctual payment of principal, premium (if any), and interest (including any additional amounts required to be paid in accordance with the terms and conditions of the Securities) from time to time payable by the Issuer in respect of the Securities as and when the same shall become due, whether at stated maturity, upon redemption or repayment, by acceleration or otherwise, and accordingly undertakes to pay such Holder, in the manner and the currency set forth in the terms and conditions of the Securities, any amount or amounts which the Issuer is at any time liable to pay in respect of such Securities and which the Issuer has failed to pay, including amounts that become due in advance of their stated maturity as a result of acceleration. Any diligence, presentment, demand, protest or notice, whether in relation to the Guarantor, the Issuer, or any other person, from a Holder, in respect of any of the Guarantor’s obligations under this Guarantee is hereby waived.
The obligations of the Guarantor under this Guarantee constitute direct, unsecured and unsubordinated obligations of the Guarantor and the Guarantor undertakes that its obligations hereunder will rank pari passu with all other present or future direct, unsecured and unsubordinated obligations of the Guarantor.
This Guarantee is a guarantee of payment and not merely of collection and it shall continue in full force and effect by way of continuing security until all principal, premium (if any) and interest (including any additional amounts required to be paid in accordance with the terms and conditions of the Securities) have been paid in full and all other actual or contingent obligations of the Issuer in relation to the Securities or under the Indenture have been satisfied in full.
Notwithstanding the foregoing, if any payment received by any Holder is, on the subsequent bankruptcy or insolvency of the Issuer, avoided under any applicable laws, including, among others, laws relating to bankruptcy or insolvency, such payment will not be considered as having discharged or diminished the liability of the Guarantor and this Guarantee will continue to apply as if such payment had at all times remained owing by the Issuer.
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5. | Exercise of Rights, Subrogation and Claims against the Issuer |
Until all principal, premium (if any) and interest and all other monies payable by the Issuer in respect of any Securities shall be paid in full, (i) no right of the Guarantor, by reason of the performance of any of its obligations under this Guarantee, to be indemnified by the Issuer or to take the benefit of or enforce any security or other guarantee or indemnity against the Issuer in connection with the Securities shall be exercised or enforced and (ii) the Guarantor shall not (a) by virtue of this Guarantee or any other reason be subrogated to any rights of any Holder or (b) claim in competition with the Holders against the Issuer. If the Guarantor receives any benefit, payment or distribution in relation to such rights it shall hold that benefit, payment or distribution to the extent necessary to enable all amounts which may be or become payable to the Holders by the Issuer under or in connection with the Securities to be paid in full on behalf and for the benefit of the Holders and shall promptly pay or transfer the same to the Holders as they may direct to the extent such amount shall be due and unpaid by the Issuer to the Holders.
Each notice or demand under this Guarantee shall be made in writing, in English, and may be sent by messenger, fax or pre-paid first class post to the Guarantor at the address, and for the attention of the person, from time to time designated by the Guarantor for the purposes of this Guarantee. Any such notice or demand shall be effective when actually received by such addressee. The address, attention and telefax number of the Guarantor for notices or demands under this Guarantee for the time being are as follows:
Education Realty Trust, Inc.
999 South Shady Grove Road., Suite 600
Memphis, Tennessee 38120
Attention: Chief Financial Officer
Fax: (901) 259-2594
The Guarantor shall not be entitled to assign or transfer any or all of its rights, benefits or obligations under this Guarantee, except in connection with an assignment or transfer permitted by Article 8 of the Indenture. Each Holder shall be entitled to assign all or any of its rights and benefits under this Guarantee.
If a provision of this Guarantee is or becomes illegal, invalid or unenforceable in any jurisdiction, that shall not affect the validity or enforceability in that jurisdiction or in any other jurisdiction of any other provision of this Guarantee.
Any Securities issued by the Issuer under the Indenture on or after the date of this Guarantee shall have the benefit of this Guarantee, but shall not have the benefit of any subsequent guarantee of the Guarantor, unless expressly so provided in any such subsequent guarantee.
This Guarantee shall be governed by, and construed in accordance with, the laws of the State of New York without regard to conflicts of law principles of such State other than New York General Obligations Law Section 5-1401.
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EDUCATION REALTY TRUST, INC. By: /s/ Edwin B. Brewer, Jr.
Edwin B. Brewer, Jr.
Executive Vice President
and Chief Financial Officer | |
November 24, 2014
Education Realty Trust, Inc.
Suite 600
999 South Shady Grove Road
Memphis, Tennessee 38120
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
We have served as Maryland counsel to Education Realty Trust, Inc., a Maryland corporation (the “Company”), in connection with certain matters of Maryland law arising out of the registration of $250,000,000 aggregate principal amount of 4.600% Senior Notes due 2024 (the “Notes”) issued by Education Realty Operating Partnership, LP, a Delaware limited partnership (the “Issuer”) and the guarantee by the Company of the obligations of the Issuer under the Notes, covered by the above-referenced Registration Statement, and all amendments thereto (the “Registration Statement”), filed by the Company with the United States Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “1933 Act”).
In connection with our representation of the Company, and as a basis for the opinion hereinafter set forth, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following documents (hereinafter collectively referred to as the “Documents”):
1. The Registration Statement;
2. The Prospectus, dated November 7, 2014, as supplemented by a Prospectus Supplement, dated November 19, 2014 (the “Prospectus Supplement”), filed with the Commission pursuant to Rule 424(b) of the General Rules and Regulations promulgated under the 1933 Act;
3. The charter of the Company (the “Charter”), certified by the State Department of Assessments and Taxation of Maryland (the “SDAT”);
4. The Amended and Restated Bylaws of the Company, as amended, certified as of the date hereof by an officer of the Company;
5. A certificate of the SDAT as to the good standing of the Company, dated as of a recent date;
6. Resolutions adopted by the Board of Directors of the Company (the “Board”) relating to, among other matters, (a) the guaranty by the Company of the Notes and (b)
Education Realty Trust, Inc.
November 24, 2014
Page 2
the authorization of the execution, delivery and performance by the Company of the Note Documents (as defined herein), certified as of the date hereof by an officer of the Company;
7. The Indenture, dated as of November 7, 2014 (the “Indenture”), by and among the Company, the Issuer and U.S. Bank, National Association, as trustee (the “Trustee”);
8. The First Supplemental Indenture, dated as of the date hereof (the “Supplemental Indenture”), by and among the Company, the Issuer and the Trustee;
9. The Guarantee, dated as of the date hereof (the “Guarantee” and, together with the Indenture and the Supplemental Indenture, the “Note Documents”), by the Company in respect of the Notes.
10. A certificate executed by an officer of the Company, dated as of the date hereof; and
11. Such other documents and matters as we have deemed necessary or appropriate to express the opinion set forth below, subject to the assumptions, limitations and qualifications stated herein.
In expressing the opinion set forth below, we have assumed the following:
1. Each individual executing any of the Documents, whether on behalf of such individual or any other person, is legally competent to do so.
2. Each individual executing any of the Documents on behalf of a party (other than the Company) is duly authorized to do so.
3. Each of the parties (other than the Company) executing any of the Documents has duly and validly executed and delivered each of the Documents to which such party is a signatory, and such party’s obligations set forth therein are legal, valid and binding and are enforceable in accordance with all stated terms.
4. All Documents submitted to us as originals are authentic. The form and content of all Documents submitted to us as unexecuted drafts do not differ in any respect relevant to this opinion from the form and content of such Documents as executed and delivered. All Documents submitted to us as certified or photostatic copies conform to the original documents. All signatures on all Documents are genuine. All public records reviewed or relied upon by us or on our behalf are true and complete. All representations, warranties, statements and information contained in the Documents are true and complete. There has been no oral or written modification of or amendment to any of the Documents, and there has been no waiver of any provision of any of the Documents, by action or omission of the parties or otherwise.
Education Realty Trust, Inc.
November 24, 2014
Page 3
Based upon the foregoing, and subject to the assumptions, limitations and qualifications stated herein, it is our opinion that:
1. The Company is a corporation duly incorporated and existing under and by virtue of the laws of the State of Maryland and is in good standing with the SDAT.
2. The Company has the corporate power to authorize, execute, deliver and perform the Note Documents.
3. The execution, delivery and performance of the Note Documents, and the consummation of the transactions contemplated thereby, have been duly authorized by all necessary corporate action on the part of the Company.
4. The Note Documents have been duly executed by the Company.
The foregoing opinion is limited to the laws of the State of Maryland and we do not express any opinion herein concerning any other law. We express no opinion as to compliance with any federal or state securities laws, including the securities laws of the State of Maryland, or as to federal or state laws regarding fraudulent transfers. To the extent that any matter as to which our opinion is expressed herein would be governed by the laws of any jurisdiction other than the State of Maryland, we do not express any opinion on such matter. The opinion expressed herein is subject to the effect of judicial decisions which may permit the introduction of parol evidence to modify the terms or the interpretation of agreements.
The opinion expressed herein is limited to the matters specifically set forth herein and no other opinion shall be inferred beyond the matters expressly stated. We assume no obligation to supplement this opinion if any applicable law changes after the date hereof or if we become aware of any fact that might change the opinion expressed herein after the date hereof.
This opinion is being furnished to you for submission to the Commission as an exhibit to the Company’s Current Report on Form 8-K relating to the Notes (the “Current Report”), which is incorporated by reference in the Registration Statement. We hereby consent to the filing of this opinion as an exhibit to the Current Report and the said incorporation by reference and to the use of the name of our firm therein. Morrison & Foerster LLP, counsel to the Company, may rely on this opinion in connection with any opinions to be delivered by it in connection with the Notes. In giving this consent, we do not admit that we are within the category of persons whose consent is required by Section 7 of the 1933 Act.
Very truly yours,
/s/ Venable LLP
[LETTERHEAD OF MORRISON & FOERSTER LLP]
November 24, 2014
Education Realty Trust, Inc.
Education Realty Operating Partnership, LP
999 South Shady Grove Road, Suite 600
Memphis, Tennessee 38120
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Re: | Education Realty Operating Partnership, LP - $250,000,000 4.600% Senior Notes due 2024 |
Ladies and Gentlemen:
We have acted as special counsel to Education Realty Trust, Inc., a Maryland corporation (the “Company”), and Education Realty Operating Partnership, LP (the “Operating Partnership”) in connection with the issuance and sale by the Operating Partnership of $250,000,000 aggregate principal amount of 4.600% Senior Notes due 2024 (the “Notes”) and the guarantee of the Notes (the “Guarantee”) by the Company, under that certain indenture, dated as of November 7, 2014 (the “Base Indenture’), among the Company, as guarantor, the Operating Partnership, and U.S. Bank National Association, as trustee (the “Trustee”), as supplemented by the First Supplemental Indenture, dated as of November 24, 2014, among the Company, as guarantor, the Operating Partnership and the Trustee (the “First Supplemental Indenture”, and together with the Base Indenture, the “Indenture”), and pursuant to a Registration Statement on Form S-3 (File Nos. 333-199988 and 333-199988-01) under the Securities Act of 1933, as amended (the “Act”), filed by filed by the Company and the Operating Partnership with the Securities and Exchange Commission (the “Commission”) on November 7, 2014 (as so filed and as amended, the “Registration Statement”), a base prospectus, dated November 7, 2014, included as part of the Registration Statement (the “Base Prospectus”), a preliminary prospectus supplement, dated November 19, 2014, filed with the Commission pursuant to Rule 424(b) under the Act, a prospectus supplement, dated November 19, 2014, filed with the Commission pursuant to Rule 424(b) under the Act (together with the Base Prospectus, the “Prospectus”), and an Underwriting Agreement, dated as of November 19, 2014 (the “Underwriting Agreement”), among the Company, the Operating Partnership, and J.P. Morgan Securities LLC, RBC Capital Markets, LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and PNC Capital Markets LLC, as representatives of the several underwriters listed on Schedule I thereto.
In connection with this opinion, we have examined originals or copies, certified or otherwise identified to our satisfaction, of: (i) the Articles Supplementary of the Company; (ii) Articles of Restatement of the Company, as amended through the date hereof; (iii) the Amended and Restated Bylaws of the Company, as amended through the date hereof; (iv) the Agreement of Limited Partnership of the Operating Partnership; (v) the Certificate of Limited Partnership of the Operating Partnership (vi) certain resolutions of the board of directors of the Company, relating to the issuance, sale and registration of the Notes; and (vii) a specimen of the Notes. In addition, we have examined originals or copies, certified or otherwise identified to our satisfaction, of certain other corporate
Board of Directors
Education Realty Trust, Inc.
November 24, 2014
Page 2
records, documents, instruments and certificates of public officials and of the Company, and we have made such inquiries of officers of the Company and public officials and considered such questions of law as we have deemed necessary for purposes of rendering the opinions set forth herein.
The opinions hereinafter expressed are subject to the following qualifications and exceptions:
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(i) | the effect of bankruptcy, insolvency, reorganization, arrangement, moratorium or other similar laws relating to or affecting the rights of creditors generally, including, without limitation, laws relating to fraudulent transfers or conveyances, preferences and equitable subordination; |
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(ii) | limitations imposed by general principles of equity upon the availability of equitable remedies or the enforcement of provisions of any Securities, and the effect of judicial decisions which have held that certain provisions are unenforceable where their enforcement would violate the implied covenant of good faith and fair dealing, or would be commercially unreasonable, or where their breach is not material; and |
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(iii) | our opinion is based upon current statutes, rules, regulations, cases and official interpretive opinions, and it covers certain items that are not directly or definitively addressed by such authorities. |
In connection with this opinion, we have assumed the genuineness of all signatures and the authenticity of all items submitted to us as originals and the conformity with originals of all items submitted to us as copies. In making our examination of documents executed by parties other than the Operating Partnership, we have assumed that each other party has the power and authority to execute and deliver, and to perform and observe the provisions of, such documents and has duly authorized, executed and delivered such documents, and that such documents constitute the legal, valid and binding obligations of each such party. We also have assumed the integrity and completeness of the minute books of the Company and the Operating Partnership presented to us for examination. With respect to certain factual matters, we have relied upon certificates of officers of the Company and the Operating Partnership.
Based upon, subject to and limited by the foregoing, we are of the opinion that the Notes have been duly executed, issued and authenticated in accordance with the terms of the Indenture and delivered against payment therefor in the circumstances contemplated by the Underwriting Agreement, the Notes and the Guarantee will be legally valid and binding obligations of the Operating Partnership and the Company, respectively, enforceable against the Operating Partnership and the Company in accordance with their respective terms.
We do not express any opinion herein concerning any law other than the internal laws of the State of New York, the Delaware Revised Uniform Limited Partnership Act, and the federal laws of the United States of America as in effect on the date hereof. Various issues concerning Maryland law are addressed in the opinion of Venable LLP, which has been separately provided to you. We express no opinion with respect to those matters herein.
Board of Directors
Education Realty Trust, Inc.
November 24, 2014
Page 3
We hereby consent to the filing of this opinion letter as Exhibit 5.1 to the Company’s Current Report on Form 8-K to be filed with the Commission on or about November 24, 2014, which will be incorporated by reference in the Registration Statement, and to reference to us under the caption “Legal Matters” in the Prospectus, which is a part of the Registration Statement. In giving such consent, we do not hereby admit that we are acting within the category of persons whose consent is required under Section 7 of the Act or the rules or regulations of the Commission thereunder.
Very truly yours,
/s/ Morrison & Foerster LLP
[LETTERHEAD OF MORRISON & FOERSTER LLP]
November 24, 2014
Education Realty Trust, Inc.
Education Realty Operating Partnership, LP
999 South Shady Grove Road, Suite 600
Memphis, TN 38120
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Re: | Education Realty Trust, Inc. and Education Realty Operating Partnership, LP |
Ladies and Gentlemen:
We have acted as tax counsel to Education Realty Trust, Inc., a Maryland corporation (“EDR”), and Education Realty Operating Partnership, LP, a Delaware limited partnership (the “Operating Partnership” and, together with the Company, the “Transaction Entities”), in connection with the issuance and sale by the Operating Partnership of $250,000,000 aggregate principal amount of 4.600 % Senior Notes due 2024 (the “Notes”) pursuant to the terms of the Underwriting Agreement, dated November 19, 2014 (the “Underwriting Agreement”), by and among EDR, the Operating Partnership and the several Underwriters named in Schedule I thereto, for whom JP Morgan Securities LLC, RBC Capital Markets LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and PNC Capital Markets LLC are acting as representatives. All capitalized terms used herein and not otherwise defined have the respective meanings assigned to them in the Underwriting Agreement.
In connection with this opinion, we have examined originals or copies, certified or otherwise identified to our satisfaction, of such documentation and information provided by EDR as we have deemed necessary or appropriate as a basis for the opinion set forth herein. We have also examined the Registration Statement on Form S‑3, File Nos. 333-199988 and
333-199988-01, as filed by the Transaction Entities with the Securities and Exchange Commission (the “Commission”) in accordance with the provisions of the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Act”), which became automatically effective under the Act on November 7, 2014. The Registration Statement includes the base prospectus, dated November 7, 2014, together with the prospectus supplement, dated November 19, 2014 (the “Prospectus Supplement”) in the form filed with the Commission pursuant to its Rule 424(b). In addition, EDR has provided us with, and we are relying upon, a certificate containing certain factual representations and covenants of a duly authorized officer of EDR (the “Officer’s Certificate”) relating to, among
Education Realty Trust, Inc.
Education Realty Operating Partnership, LP
Page 2
other things, the actual and proposed operations of EDR, the Operating Partnership and the entities in which either holds, or has held, a direct or indirect interest (EDR, the Operating Partnership and such entities, collectively, the “Company”).
For purposes of this opinion, we have not independently verified the facts, statements, representations and covenants set forth in the Officer’s Certificate or in any other document. In particular, we note that the Company has engaged in, and may engage in, transactions in connection with which we have not provided legal advice, and have not reviewed, and of which we may be unaware. Consequently, we have relied on EDR’s representations that the facts, statements, representations and covenants presented in the Officer’s Certificate and other documents, or otherwise furnished to us, accurately and completely describe all material facts relevant to our opinion. We have assumed that all such facts, statements, representations and covenants are true without regard to any qualification as to knowledge, belief or intent. Our opinion is conditioned on the continuing accuracy and completeness of such facts, statements, representations and covenants. We are not aware of any facts inconsistent with such facts, statements, representations and covenants. Any material change or inaccuracy in the facts, statements, representations and covenants referred to, set forth, or assumed herein or in the Officer’s Certificate may affect our conclusions set forth herein.
In our review of certain documents in connection with our opinion expressed below, we have assumed (a) the genuineness of all signatures on documents that we have examined, (b) the authority and capacity of the individual or individuals executing such documents and (c) that each of the documents (i) has been duly authorized, executed and delivered, (ii) is authentic, if an original, or is accurate, if a copy, and (iii) has not been amended subsequent to our review. Where documents have been provided to us in draft form, we have assumed that the final executed versions of such documents will not differ materially from such drafts.
Our opinion also is based on the correctness of the following assumptions: (a) the entities comprising the Company have been and will continue to be operated in accordance with the laws of the jurisdictions in which they were formed and in the manner described in the relevant organizational documents, (b) there will be no changes in the applicable laws of the State of Maryland or of any other jurisdiction under the laws of which any of the entities comprising the Company have been formed and (c) each of the written agreements to which the Company is a party will be implemented, performed, construed and enforced in accordance with its terms.
In rendering our opinion, we have considered and relied upon the Internal Revenue Code of 1986, as amended (the “Code”), the regulations promulgated thereunder (the “Regulations”), administrative rulings and other interpretations of the Code and the Regulations by the courts and the Internal Revenue Service (“IRS”), all as they exist at the date hereof. It should be noted that the Code, Regulations, judicial decisions, and administrative interpretations are subject to
Education Realty Trust, Inc.
Education Realty Operating Partnership, LP
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change at any time and, in some circumstances, with retroactive effect. A material change that is made after the date hereof to any of the foregoing bases for our opinion could affect our conclusions set forth herein. In this regard, an opinion of counsel with respect to an issue represents counsel’s best judgment as to the outcome on the merits with respect to such issue, is not binding on the IRS or the courts, and is not a guarantee that the IRS will not assert a contrary position with respect to such issue or that a court will not sustain such a position if asserted by the IRS.
We express no opinion as to the laws of any jurisdiction other than the federal income tax laws of the United States of America to the extent specifically referred to herein. In addition, we express no opinion on any issue relating to EDR, other than as expressly stated below.
Based on the foregoing and subject to the other qualifications, assumptions, representations and limitations included herein, we are of the opinion that, as of the date hereof:
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(i) | EDR has been organized and has operated in conformity with the requirements for qualification and taxation as a real estate investment trust (a “REIT”) pursuant to Sections 856 through 860 of the Code for its taxable year ending December 31, 2009 through its taxable year ending December 31, 2013, and EDR’s organization and current and proposed method of operation will enable it to continue to qualify for taxation as a REIT for its taxable year ending December 31, 2014 and in the future. |
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(ii) | The Operating Partnership is and has been properly treated as a partnership for U.S. federal income tax purposes and not as a corporation or as an association or publicly traded partnership taxable as a corporation, throughout the period from 2009 through the date of this opinion. |
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(iii) | We have reviewed the statements included in the Prospectus Supplement under the heading “Material U.S. Federal Income Tax Considerations” and, insofar as such statements pertain to matters of law or legal conclusions, they are correct in all material respects. |
EDR’s continued qualification and taxation as a REIT depend upon its ability to meet, through actual annual operating results, certain requirements relating to the sources of its income, the nature of its assets, its distribution levels, the diversity of its stock ownership and various other qualification tests imposed under the Code and the Regulations, the results of which are not reviewed by us. Accordingly, no assurance can be given that the actual results of EDR’s operations for the current taxable year or any future taxable years will satisfy the requirements for taxation as a REIT under the Code.
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This opinion is expressed as of the date hereof, and we are under no obligation to supplement or revise our opinion to reflect any legal developments or factual matters arising subsequent to the date hereof, or the impact of any information, document, certificate, record, statement, representation, covenant, or assumption relied upon herein that becomes incorrect or untrue. We will not review on a continuing basis EDR’s or the Company’s compliance with the documents or assumptions set forth above, or the representations set forth in the Officer’s Certificate. Accordingly, no assurance can be given that the actual results of EDR’s operations for the current taxable year or any future taxable years will satisfy the requirements for qualification and taxation as a REIT.
The foregoing opinion is based on current provisions of the Code and the Regulations, published administrative interpretations thereof, and published court decisions. The IRS has not issued Regulations or administrative interpretations with respect to various provisions of the Code relating to REIT qualification and taxation. No assurance can be given that the law will not change in a way that will prevent EDR from qualifying as a REIT.
The foregoing opinion is limited to the federal income tax matters addressed herein, and no other opinion is rendered with respect to other federal tax matters or to any issues arising under the tax laws of any other country, or any state or locality. This opinion letter is solely for your information and use in connection with the transactions described above, and it speaks only as of the date hereof. We hereby consent to the filing of this opinion as an exhibit to the Current Report on Form 8-K of the Transaction Entities to be filed with the Commission on or about November 24, 2014 (the “Form 8-K”). We also consent to the reference to our firm name wherever appearing in the Registration Statement or the Form 8-K. In giving this consent, we do not admit that we come within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder, nor do we thereby admit that we are experts with respect to any part of the Registration Statement within the meaning of the term “experts” as used in the Securities Act or the rules and regulations of the Commission promulgated thereunder. We undertake no obligation to update any opinion expressed herein after the date of this letter. This opinion letter may not be distributed, quoted in whole or in part or relied upon for any purpose by any other person, or otherwise reproduced in any document, or filed with any governmental agency without our express prior written consent.
Sincerely,
/s/ Morrison & Foerster LLP
EXHIBIT 10.1
FIFTH AMENDED AND RESTATED CREDIT AGREEMENT
dated as of
November 19, 2014
among
EDUCATION REALTY OPERATING PARTNERSHIP, LP,
as Borrower
and
The Lenders Party Hereto
and
KEYBANK, NATIONAL ASSOCIATION,
as Administrative Agent
REGIONS BANK,
PNC BANK, NATIONAL ASSOCIATION, and ROYAL BANK OF CANADA
as Documentation Agents
KEYBANC CAPITAL MARKETS, PNC CAPITAL MARKETS LLC, RBC CAPITAL MARKETS, and REGIONS CAPITAL MARKETS,
AS CO-BOOKRUNNERS AND CO-LEAD ARRANGERS
TABLE OF CONTENTS
ARTICLE I Definitions 2
SECTION 1.01 Defined Terms 2
SECTION 1.02 Classification of Loans and Borrowings 23
SECTION 1.03 Terms Generally 23
SECTION 1.04 Accounting Terms; GAAP 24
ARTICLE II The Credits 24
SECTION 2.01 Commitments 24
SECTION 2.02 Loans and Borrowings. 25
SECTION 2.03 Requests for Revolving Borrowings 25
SECTION 2.04 Swingline. 26
SECTION 2.05 Letters of Credit. 27
SECTION 2.06 Funding of Borrowings. 32
SECTION 2.07 Interest Elections. 32
SECTION 2.08 Termination, Reduction and Increase of Commitments. 34
SECTION 2.09 Repayment of Loans; Evidence of Debt. 35
SECTION 2.10 Prepayment of Loans. 35
SECTION 2.11 Fees. 36
SECTION 2.12 Interest. 38
SECTION 2.13 Alternate Rate of Interest 38
SECTION 2.14 Increased Costs. 39
SECTION 2.15 Break Funding Payments 40
SECTION 2.16 Taxes. 41
SECTION 2.17 Payments Generally; Pro Rata Treatment; Sharing of Set-offs. 42
SECTION 2.18 Defaulting Lenders. 44
SECTION 2.19 Mitigation Obligations; Replacement of Lenders. 46
SECTION 2.20 Extension. 47
ARTICLE III Representations and Warranties 48
SECTION 3.01 Organization; Powers 48
SECTION 3.02 Authorization; Enforceability 48
SECTION 3.03 Governmental Approvals; No Conflicts 48
SECTION 3.04 Financial Condition; No Material Adverse Change. 49
SECTION 3.05 Properties. 49
SECTION 3.06 Intellectual Property 51
SECTION 3.07 Litigation and Environmental Matters. 51
SECTION 3.08 Compliance with Laws and Agreements 53
SECTION 3.09 Investment and Holding Company Status 53
SECTION 3.10 Taxes 53
SECTION 3.11 ERISA 53
SECTION 3.12 Disclosure 54
SECTION 3.13 Insurance 54
SECTION 3.14 Margin Regulations 54
SECTION 3.15 Subsidiaries; REIT Qualification 54
ARTICLE IV Conditions 54
SECTION 4.01 Effective Date 55
SECTION 4.02 Each Credit Event 55
ARTICLE V Affirmative Covenants 56
SECTION 5.01 Financial Statements; Ratings Change and Other Information 56
SECTION 5.02 Financial Tests 57
SECTION 5.03 Notices of Material Events 58
SECTION 5.04 Existence; Conduct of Business 58
SECTION 5.05 Payment of Obligations 58
SECTION 5.06 Maintenance of Properties; Insurance. 59
SECTION 5.07 Books and Records; Inspection Rights. 59
SECTION 5.08 Compliance with Laws 59
SECTION 5.09 Use of Proceeds and Letters of Credit 59
SECTION 5.10 Fiscal Year 60
SECTION 5.11 Environmental Matters. 60
SECTION 5.12 Unencumbered Pool 60
SECTION 5.13 Additions to Unencumbered Pool 61
SECTION 5.14 Removal of Real Property from Unencumbered Pool 61
SECTION 5.15 Further Assurances 61
SECTION 5.16 [Reserved] 61
SECTION 5.17 Parent Covenants 61
SECTION 5.18 OFAC 62
ARTICLE VI Negative Covenants 62
SECTION 6.01 Sale/Leaseback 62
SECTION 6.02 Liens 62
SECTION 6.03 Fundamental Changes 62
SECTION 6.04 Investments, Loans, Advances and Acquisitions 63
SECTION 6.05 Hedging Agreements 64
SECTION 6.06 Restricted Payments 64
SECTION 6.07 Transactions with Affiliates 64
SECTION 6.08 Parent Negative Covenants 65
SECTION 6.09 Restrictive Agreements 65
SECTION 6.10 Indebtedness 65
ARTICLE VII Events of Default 66
ARTICLE VIII The Administrative Agent 68
ARTICLE IX Miscellaneous 70
SECTION 9.01 Notices 70
SECTION 9.02 Waivers; Amendments. 71
SECTION 9.03 Expenses; Indemnity; Damage Waiver. 73
SECTION 9.04 Successors and Assigns. 74
SECTION 9.05 Survival 77
SECTION 9.06 Counterparts; Integration; Effectiveness; Joint and Several. 78
SECTION 9.07 Severability 79
SECTION 9.08 Right of Setoff 79
SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process. 79
SECTION 9.10 WAIVER OF JURY TRIAL 80
SECTION 9.11 Headings 80
SECTION 9.12 Confidentiality 81
SECTION 9.13 Interest Rate Limitation 81
SECTION 9.14 USA PATRIOT Act 82
SCHEDULES:
Schedule 2.01 – Commitments
Schedule 3.05(f) – Earthquake or Seismic Area
Schedule 3.07 – Litigation
Schedule 3.15 – Subsidiaries
Schedule 5.12 – Unencumbered Pool
Schedule 6.02 -- Existing Liens
EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B – Form of Compliance Certificate
Exhibit C – Form of Guaranty
Exhibit D – Form of Note
Exhibit E – Form of Borrowing Request/Interest Rate Election
THIS FIFTH AMENDED AND RESTATED CREDIT AGREEMENT AMENDS AND RESTATES THAT CERTAIN FOURTH AMENDED AND RESTATED CREDIT AGREEMENT DATED JANUARY 14, 2013 (AS SAME WAS AMENDED FROM TIME TO TIME, THE "ORIGINAL CREDIT AGREEMENT"), ENTERED INTO BETWEEN EDUCATION REALTY OPERATING PARTNERSHIP, LP
AND CERTAIN OF ITS SUBSIDIARIES, AS BORROWER, KEYBANK NATIONAL ASSOCIATION, AS ADMINISTRATIVE AGENT, REGIONS BANK, PNC BANK, NATIONAL ASSOCIATION, AND ROYAL BANK OF CANADA, AS CO-SYNDICATION AGENTS, AND
KEYBANC CAPITAL MARKETS, PNC CAPITAL MARKETS LLC, RBC CAPITAL MARKETS AND REGIONS CAPITAL MARKETS,
AS CO-BOOKRUNNERS AND CO-LEAD ARRANGERS, AND
THE VARIOUS LENDERS PARTY THERETO
FIFTH AMENDED AND RESTATED CREDIT AGREEMENT (“Agreement”) dated as of
November 19, 2014, among
EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership,
the LENDERS party hereto,
KEYBANK, NATIONAL ASSOCIATION,
as Administrative Agent, and
KEYBANC CAPITAL MARKETS, PNC CAPITAL MARKETS LLC,
RBC CAPITAL MARKETS and REGIONS CAPITAL MARKETS,
as Co- Bookrunners and Co-Lead Arrangers
REGIONS BANK, PNC BANK, NATIONAL ASSOCIATION and
ROYAL BANK OF CANADA,
as Documentation Agents
The parties hereto agree as follows:
WHEREAS, the Borrower, KeyBank, National Association and the other parties referenced above (the "Original Lenders") entered into the Original Credit Agreement wherein loans and other financial accommodations were extended to the Borrower; and
WHEREAS, certain of the Original Lenders have assigned their interests in under the Original Credit Agreement to KeyBank, National Association; and
WHEREAS, the Borrower, KeyBank, National Association, as the Administrative Agent and the Lenders which have not been replaced, together with certain new Lenders party hereto, desire to modify, amend and restate the Original Credit Agreement as provided herein.
ARTICLE I
Definitions
SECTION 1.01 Defined Terms. As used in this Agreement, the following terms have the meanings specified below:
“ABR,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.
“Acceptable Unencumbered Property” means Real Property (a) that is approved by the Administrative Agent and the Majority Lenders in their sole discretion, or (b) that at all times satisfies all of the following criteria as certified by Borrower: (i) such Real Property is wholly-owned (directly or indirectly) by Borrower or a Property Subsidiary which is a wholly owned Subsidiary of the Borrower or a Subsidiary that is part of the Consolidated Group, either in fee simple title or through an Eligible Off Campus Ground Lease or an Eligible Property Lease; (ii) is not subject to a Lien in favor of any Person in any manner, other than Permitted Encumbrances; (iii) consists of completed income-producing, first-class collegiate housing communities of scope and quality consistent with the Borrower’s overall portfolio of Real Property; (iv) is located in states in the United States of America; (v) is managed by Borrower, its Subsidiary or the Management Company; (vi) a final certificate of occupancy, or the local equivalent, has been issued by the appropriate Governmental Authority for all of the improvements on the Real Property; (vii) no material deferred maintenance and no material deferred capital improvements are required to continue operating as a first-class collegiate housing community, as determined by an architectural or engineering report; and (viii) the owner of the subject Real Property must be able to make the representations and warranties in Sections 3.05 and 3.07 as to such Real Property.
“Adjusted EBITDA” means, for a given testing period, EBITDA less the Capital Expenditure Reserve.
“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) determined by the Administrative Agent equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.
“Adjusted Unencumbered NOI” means Unencumbered NOI for the most recently ended testing period less the Capital Expenditures Reserve.
“Administrative Agent” means KeyBank, National Association, in its capacity as administrative agent for the Lenders hereunder.
“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.
“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.
“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%, and (c) the then applicable Adjusted LIBO Rate for one month interest periods, plus 1.00% per annum. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.
"Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Parent or its Subsidiaries from time to time concerning or relating to bribery or corruption.
“Applicable Percentage” means, with respect to any Lender, the percentage of the total Commitments represented by such Lender's Commitment. If the Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Revolving Credit Exposure most recently in effect, giving effect to any assignments.
“Applicable Rate” means, as applicable from time to time:
(a) subject to clause (b) below, for any day, with respect to any ABR Loan or Eurodollar Revolving Loan, as the case may be, the applicable rate per annum set forth below under the caption “ABR Spread” or “Eurodollar Spread,” as the case may be, based upon the Total Leverage Ratio applicable on such date:
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Total Leverage Ratio | ABR Spread | Eurodollar Spread |
Category 1 <40% | .25% | 1.25% |
Category 2 >40% but <45% | .35% | 1.35% |
Category 3 >45% but <50% | .50% | 1.50% |
Category 4 > 50% but <55% | .70% | 1.70% |
> 55% | .95% | 1.95% |
Each change in the Applicable Rate shall apply during the period commencing on the date of the most recent Compliance Certificate delivered to the Administrative Agent and ending on the date of receipt of the next Compliance Certificate pursuant to Section 5.01(c). If a Compliance Certificate
is not delivered to the Administrative Agent in accordance with Section 5.01(c) the Applicable Rate shall be deemed to be in Category 4 until the required Compliance Certificate is delivered to the Administrative Agent.
(b) If Parent or Borrower obtains an Investment Grade Rating, the Borrower may, upon written notice to the Administrative Agent, make an irrevocable one time election to exclusively use the below table based on the applicable rate per annum set forth in the below table notwithstanding any failure of the Parent or Borrower to maintain an Investment Grade Rating or any failure of the Parent or Borrower to maintain a Debt Rating.
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Investment Grade Rating | ABR Spread | Eurodollar Spread | Facility Fee |
Category 1 At least A- or A3 | 0.00% | .85% | 0.10% |
Category 2 At least BBB+ or Baa1 | 0.00% | .90% | 0.15% |
Category 3 At least BBB or Baa2 | 0.05% | 1.05% | 0.20% |
Category 4 At least BBB- or Baa3 | 0.25% | 1.25% | 0.25% |
Category 5 Below BBB-, Baa3 or unrated | 0.65% | 1.60% | 0.30% |
Each change in the Applicable Rate resulting from a change in the Debt Rating of the Parent or Borrower shall be effective for the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change. Notwithstanding the above, if at any time there is a split in the Debt Ratings of Parent or Borrower then the Applicable Rate shall be determined by reference to the most favored rating of S&P, Fitch or Moody’s. If the Parent or Borrower does not have any Debt Rating, Category 5 shall apply.
“Approved Fund” has the meaning set forth in Section 9.04(b).
“Assets Under Development” means all Real Property, or phases thereof, that is under construction or development as an income-producing project in a diligent manner and in accordance with industry standard construction schedules, but for which a certificate of occupancy has not been issued.
“Assignment and Acceptance” means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.
“Availability Period” means the period from and including the Effective Date to but excluding the Maturity Date.
“Board” means the Board of Governors of the Federal Reserve System of the United States of America.
“Bond Facility” means the $250,000,000 of unsecured senior bonds issued by Borrower via public bond offering on November 19, 2014 maturing on November 19, 2024 or any other issuance of public or private senior unsecured bonds by Borrower.
“Borrower” means Education Realty Operating Partnership, LP, a Delaware limited partnership.
“Borrowing” means (a) Revolving Loans of the same Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect, or (b) a Swingline Loan.
“Borrowing Request” means a request by the Borrower for a Revolving Borrowing in accordance with Section 2.03.
“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in Boston, Massachusetts or New York, New York are authorized or required by law to remain closed; provided that, when used in connection with a Eurodollar Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.
“Capital Expenditure Reserve” means, on an annual basis, an amount equal to (a) the aggregate number of beds available for lease in each Real Property parcel owned by Borrower or any Subsidiary measured as of the last day of each of the immediately preceding four (4) calendar quarters and averaged, multiplied by (b) $125.00.
“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.
“Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or affiliated group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof), of shares representing more than thirty percent (30%) of the aggregate ordinary voting power represented by the issued and outstanding capital stock of the Parent; (b) occupation of a majority of the seats (other than vacant seats) on the board of directors of the Parent by Persons who were neither (i) nominated by the board of directors of the Parent nor (ii) appointed by directors so nominated; or (c) the acquisition of direct or indirect Control of the Parent by any Person or group.
“Change in Law” means (a) the adoption of any law, rule or regulation after the date of this Agreement by any Governmental Authority, (b) any change in any law, rule or regulation or in the
interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) compliance by any Lender or the Issuing Bank (or, for purposes of Section 2.14(b), by any lending office of such Lender or by such Lender's or the Issuing Bank's holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement. Notwithstanding anything herein to the contrary, (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (b) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.
“Class,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans or Swingline Loans.
“Code” means the Internal Revenue Code of 1986, as amended from time to time.
“Commitment” means, with respect to each Lender, the commitment of such Lender to make Revolving Loans and to acquire participations in Letters of Credit and Swingline Loans hereunder, expressed as an amount representing the maximum aggregate amount of such Lender's Revolving Credit Exposure hereunder, as such commitment may be reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04. The initial amount of each Lender's Commitment is set forth on Schedule 2.01, or in the Assignment and Acceptance pursuant to which such Lender shall have assumed its Commitment, as applicable. The initial aggregate amount of the Lenders’ Commitments is $500,000,000.00.
“Compliance Certificate” has the meaning set forth in Section 5.01(c) hereof and a form of which is attached hereto as Exhibit B.
“Consolidated Group” means Parent and all Persons whose financial results are consolidated with Parent for financial reporting purposes under GAAP.
“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise, which includes the customary powers of a managing member of any limited liability company, any general partner of any limited partnership, or any board of directors of a corporation. “Controlling” and “Controlled” have meanings correlative thereto.
“Credit Party” means the Borrower and the Guarantor.
“Debt Rating” means, as of any date of determination, the rating as determined by either (a) S&P, (b) Moody's or (c) Fitch and either of S&P and Moody’s, of a Person’s non-credit enhanced, senior unsecured long term debt. The Debt Rating in effect at any date is the Debt Rating that is in effect at the close of business on such date.
“Debtor Relief Laws” means any applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, insolvency, fraudulent conveyance, reorganization, or similar laws affecting the rights, remedies, or recourse of creditors generally, including without limitation the United States Bankruptcy Code and all amendments thereto, as are in effect from time to time during the term of this Agreement.
“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.
“Defaulting Lender” means, subject to Section 2.18, any Lender that: (a) has failed to perform any of its funding obligations hereunder, including in respect of its Commitment or participations in respect of Letters of Credit, within two (2) Business Days of the date required to be funded by it hereunder; (b) has notified the Borrower or Administrative Agent that it does not intend to comply with its funding obligations or has made a public statement to that effect with respect to its funding obligations hereunder (unless such notification or public statement relates to such Lender’s obligation to fund a Loan or participations in respect of Letters of Credit or Swing Loans hereunder and indicates that such position is based on such Lender’s good faith determination that a condition precedent (specifically identified and including the particular Default, if any) to funding a Loan or participations in respect of Letters of Credit or Swing Loans is not or cannot be satisfied) or under other agreements in which it commits to extend credit; (c) has failed, within two (2) Business Days after written request by the Administrative Agent or Borrower (and the Administrative Agent has received a copy of such request), to confirm in a manner reasonably satisfactory to the Administrative Agent that it will comply with its funding obligations hereunder; or (d) has, or has a direct or indirect parent company that has: (i) become the subject of a proceeding under any Debtor Relief Law; (ii) had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or a custodian appointed for it; or (iii) in the good faith determination of the Administrative Agent, taken any material action in furtherance of, or indicated its consent to, approval of or acquiescence in any such proceeding or appointment; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority; provided, further, that such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Lender.
“Dollars” or “$” refers to lawful money of the United States of America.
“EBITDA” means an amount derived from (a) net income, plus (b) deferred fee revenue and interest income associated with third party development efforts that have commenced, plus (c) to the extent included in the determination of net income, depreciation, amortization, interest expense and income taxes, plus or minus (d) to the extent included in the determination of net income, straight line impact of GAAP land lease expense, plus or minus (e) to the extent included in the determination of net income, any extraordinary losses or gains resulting from sales or payment of Indebtedness, and (f) as approved by the Administrative Agent, such approval not to be unreasonably
withheld, any extraordinary, non-recurring expenses associated with any financing, merger, acquisition, divestiture, asset impairment or other capital transaction, in each case, as determined on a consolidated basis in accordance with GAAP, and including (without duplication) the Equity Percentage of EBITDA for the Borrower’s Unconsolidated Affiliates. If EBITDA is calculated over a period of less than four (4) quarters which includes the month of August, then the average EBITDA for the months in the calculation period other than August will be substituted for the August EBITDA.
“EDR” means Education Realty Operating Partnership, LP, a Delaware limited partnership.
“Effective Date” means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 9.02).
“Eligible Off Campus Ground Lease” shall mean a lease with respect to Real Property (or a portion thereof) not owned by a university, college or other educational entity entered into by Borrower or a Subsidiary meeting the following requirements: (a) a remaining term (including renewal options exercisable at lessee’s sole option) of at least thirty (30) years, (b) may be transferred and/or assigned by lessee without landlord’s consent and (c) the Administrative Agent has determined that the ground lease is financeable in that it contains customary lender protection provisions and provides or allows for, without further consent from the landlord, (i) notice and right to cure to lessee’s lender, (ii) a pledge and mortgage of the leasehold interest, (iii) recognition of a foreclosure of the leasehold interest including no prohibition on entering into a new lease with the lender, and (iv) no right of landlord to terminate the lease without consent of lessee’s lender.
“Eligible Property Lease” shall mean a lease with respect to Real Property (or a portion thereof) owned by a university, college or other educational entity entered into by Borrower or a Subsidiary which does not constitute an Eligible Off Campus Ground Lease and is acceptable to the Administrative Agent in its reasonable discretion, such acceptance not to be unreasonably withheld, conditioned or delayed.
“Environmental Claim” means any notice of violation, action, claim, Environmental Lien, demand, abatement or other order or direction (conditional or otherwise) by any Governmental Authority or any other Person for personal injury (including sickness, disease or death), tangible or intangible property damage, damage to the environment, nuisance, pollution, contamination or other adverse effects on the environment, or for fines, penalties or restriction, resulting from or based upon (i) the existence, or the continuation of the existence, of a Release (including, without limitation, sudden or non-sudden accidental or non-accidental Releases) of, or exposure to, any Hazardous Material, or other Release in, into or onto the environment (including, without limitation, the air, soil, surface water or groundwater) at, in, by, from or related to any property owned, operated or leased by the Borrower or any of its Subsidiaries or any activities or operations thereof; (ii) the environmental aspects of the transportation, storage, treatment or disposal of Hazardous Materials in connection with any property owned, operated or leased by the Borrower or any of its Subsidiaries or their operations or facilities; or (iii) the violation, or alleged violation, of any Environmental Laws or Environmental Permits of or from any Governmental Authority relating to environmental matters connected with any property owned, leased or operated by the Borrower or any of its Subsidiaries.
“Environmental Laws” means all applicable laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the management, release or threatened release of any Hazardous Material or to health and safety matters and includes (without limitation) the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. § 9601 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq., the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. § 136 et seq., the Resource Conservation and Recovery Act (“RCRA”), 42 U.S.C. § 6901 et seq., the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., the Clean Air Act, 42 U.S.C. §7401 et seq., the Clean Water Act, 33 U.S.C. § 1251 et seq., the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq., (to the extent the same relates to any Hazardous Materials), and the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq., as such laws have been amended or supplemented, and the regulations promulgated pursuant thereto, and all analogous state and local statutes.
“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) exposure to any Hazardous Materials in violation of any Environmental Law, (c) the Release or threatened Release of any Hazardous Materials into the environment in violation of any Environmental Law or (d) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
“Environmental Lien” means any lien in favor of any Governmental Authority arising under any Environmental Law.
“Environmental Permit” means any permit required under any applicable Environmental Law or under any and all supporting documents associated therewith.
“Equity Percentage” means the aggregate ownership percentage of Borrower in each Unconsolidated Affiliate, which shall be calculated as the greater of (a) Borrower’s nominal capital ownership interest in the Unconsolidated Affiliate as set forth in the Unconsolidated Affiliate’s organizational documents, and (b) Borrower’s economic ownership interest in the Unconsolidated Affiliate, reflecting Borrower’s share of income and expenses of the Unconsolidated Affiliate.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.
“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day notice period is waived); (b) the existence with respect to any Plan of an “accumulated funding
deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
“Eurodollar,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted LIBO Rate.
“Event of Default” has the meaning assigned to such term in Article VII.
“Excluded FATCA Tax” means any tax, assessment or other governmental charge imposed under FATCA that would not have been imposed but for a failure by a Lender or a Participant (or any financial institution through which any payment is made to such Lender or Participant) to comply with Section 2.16.
“Excluded Taxes” means, with respect to the Administrative Agent, any Lender, the Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 2.19(b)), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office) or is attributable to such Foreign Lender's failure to comply with Section 2.16(e), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 2.16(a).
“Extension Request” has the meaning set forth in Section 2.20.
“Facility Fee” has the meaning set forth in Section 2.11(b).
“FATCA” means Sections 1471 through 1474 of the Code (as of the date hereof) and any regulations or official interpretations thereof (including any Revenue Ruling, Revenue Procedure, Notice or similar guidance issued by the U.S. Internal Revenue Service thereunder as a precondition
to relief or exemption from Taxes under such provisions); provided that FATCA shall also include any amendments to Sections 1471 through 1474 of the Code and any regulations or official interpretations thereof if, as amended, FATCA provides a commercially reasonable mechanism to avoid the tax imposed thereunder by satisfying the information reporting and other requirements of FATCA.
“Federal Funds Effective Rate” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.
“Financial Officer” means the chief financial officer, the chief accounting officer or treasurer of the Borrower.
"Fitch" means Fitch, Inc., and its successors.
“Fixed Charge Coverage Ratio” shall mean the ratio of (a) the Adjusted EBITDA of the Consolidated Group for the immediately preceding four (4) calendar quarters; to (b) all of the principal due and payable (excluding principal due at maturity) and principal paid on the Indebtedness (including scheduled payments on Capital Lease Obligations) of the Consolidated Group, plus the Interest Expense of the Consolidated Group, plus the aggregate of all cash dividends payable on the preferred stock of the Parent or any of its Subsidiaries, in each case for the period used to calculate Adjusted EBITDA, all of the foregoing calculated without duplication.
“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is organized. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.
“Funds From Operations” shall mean net income of the Borrower determined in accordance with GAAP, plus depreciation and amortization, revenues on participating projects which are deferred for GAAP purposes, excluding the impact of straight line accounting treatment on rents and leasehold rent expense, transaction cost related to acquisitions, severance costs and other non cash items; plus or minus any gain or loss from debt restructuring, impairments, or sales of property and, as approved by the Administrative Agent, such approval not to be unreasonably withheld, any extraordinary, non-recurring expenses associated with any financing, merger, acquisition, divestiture, or other capital transaction. Funds From Operations will be calculated for the four (4) calendar quarters immediately preceding the date of the calculation. Funds From Operations shall be calculated on a consolidated basis, and including (without duplication) the Equity Percentage of Funds From Operations for the Borrower’s Unconsolidated Affiliates.
“GAAP” means generally accepted accounting principles in the United States of America, subject to the provisions of Section 1.04.
“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business.
“Guarantor” means the Parent.
“Guaranty” means a guaranty in the form of Exhibit C attached hereto.
“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances or wastes, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law; provided, that Hazardous Materials shall not include any such substances or wastes utilized or maintained at the Real Property in the ordinary course of business and in accordance with all applicable Environmental Laws.
“Hedging Agreement” means any interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement.
“Historical Value” shall mean the purchase price of Real Property (including improvements) and ordinary related purchase transaction costs, plus the cost of subsequent capital improvements (including construction costs for property under construction or development) made by the Borrower, less any provision for losses, all determined in accordance with GAAP. If the Real Property is purchased as a part of a group of properties, the Historical Value shall be calculated based upon a pro rata allocation of the aggregate purchase price by the Borrower based on net operating income of such property, and consistent with GAAP. Historical Value shall include the Equity Percentage of Historical Value for the Borrower’s Unconsolidated Affiliates.
“Impacted Interest Period” has the meaning set forth in the definition of LIBO Rate.
“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty, (j) all obligations, contingent or otherwise, of such Person in respect of bankers' acceptances, (k) all obligations contingent or otherwise, of such Person with respect to any Hedging Agreements (calculated on a mark-to-market basis as of the reporting date), and (l) payments received in consideration of sale of an ownership interest in Borrower when the interest so sold is determined, and the date of delivery is, more than one (1) month after receipt of such payment and only to the extent that the obligation to deliver such interest is not payable solely in such interest of such Person. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person's ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. Indebtedness shall be calculated on a consolidated basis in accordance with GAAP, and including (without duplication) the Equity Percentage of Indebtedness for the Borrower’s Unconsolidated Affiliates.
“Indemnified Taxes” means Taxes other than Excluded Taxes and Excluded FATCA Tax.
“Interest Election Request” means a request by the Borrower to convert or continue a Revolving Borrowing in accordance with Section 2.07.
“Interest Expense” shall mean all of a Person's paid, accrued or capitalized interest expense on such Person's Indebtedness (whether direct, indirect or contingent, and including, without limitation, interest on all convertible debt), and including (without duplication) the Equity Percentage of Interest Expense for the Borrower’s Unconsolidated Affiliates.
“Interest Payment Date” means the first Business Day of each calendar month.
“Interest Period” means with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two or three months thereafter; provided, that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless, in the case of a Eurodollar Borrowing only, such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day and (b) any Interest Period pertaining to a Eurodollar Borrowing that commences on the last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and, in the case of a Revolving Borrowing, thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
"Interpolated Rate" means, at any time, for any Interest Period, the rate per annum (rounded to the same number of decimal places as the LIBO Rate) determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the LIBO Rate for the longest period for which the LIBO Rate is available that is shorter than the Impacted Interest Period; and (b) the LIBO Rate for the shortest period for which that LIBO Rate is available that exceeds the Impacted Interest Period, in each case, at such time.
“Investment Grade Rating” means a Debt Rating of BBB- or better from Standard & Poor’s or Fitch, or Baa3 or better from Moody’s.
“Issuing Bank” means KeyBank, National Association, in its capacity as the issuer of Letters of Credit hereunder, and its successors in such capacity as provided in Section 2.05(i). The Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of the Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate.
“KeyBank” means KeyBank, National Association, in its individual capacity.
“LC Disbursement” means a payment made by the Issuing Bank pursuant to a Letter of Credit.
“LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the aggregate amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any Lender at any time shall be its Applicable Percentage of the total LC Exposure at such time.
“Legal Requirement” means any law, statute, ordinance, decree, requirement, order, judgment, rule, regulation (or interpretation of any of the foregoing) of, and the terms of any license or permit issued by, any Governmental Authority.
“Lenders” means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Assignment and Acceptance, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Acceptance. Unless the context otherwise requires, the term “Lender” includes the Swingline Lender.
“Letter of Credit” means any letter of credit issued pursuant to this Agreement.
“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, the rate appearing on Dow Jones Markets (formerly Telerate Page 3750) (or on any successor or
substitute page of such Service, or any successor to or substitute for such Service, providing rate quotations comparable to those currently provided on such page of such Service, as determined by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, as the rate for dollar deposits with a maturity comparable to such Interest Period. In the event that such rate is not available at such time for any reason, then the “LIBO Rate” with respect to such Eurodollar Borrowing for such Interest Period shall be the rate (rounded upwards, if necessary, to the next 1/100 of 1%) at which dollar deposits of $5,000,000 and for a maturity comparable to such Interest Period are offered by the principal London office of the Administrative Agent in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period; provided that, if the LIBO Rate shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement and provided, further, if the LIBO Rate shall not be available at such time for such Interest Period (an “Impacted Interest Period”) then the LIBO Rate shall be the Interpolated Rate, provided, that, if any Interpolated Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement.
“Lien” means, with respect to an asset, (a) any mortgage, deed of trust, lien (statutory or other), pledge, hypothecation, negative pledge, collateral assignment, encumbrance, deposit arrangement, charge or security interest in, on or of such asset; (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset; (c) the filing under the Uniform Commercial Code or comparable law of any jurisdiction of any financing statement naming the owner of the asset to which such Lien relates as debtor; (d) any other preferential arrangement of any kind or nature whatsoever intended to assure payment of any Indebtedness or other obligation; and (e) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.
“Loan Documents” means this Agreement, the Notes, the Guaranty and all other instruments, agreements and written obligations executed and delivered by any of the Credit Parties in connection with the transactions contemplated hereby.
“Loans” means the loans made by the Lenders to the Borrower pursuant to this Agreement.
“Majority Lenders” means, as of any date of determination, Lenders having in excess of 50% of the aggregate Commitments or, if the commitment of each Lender to make Loans and the obligation of the Issuing Bank to issue Letters of Credit have been terminated pursuant to Article VII, Lenders holding in the aggregate in excess of 50% of the aggregate Loans (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Exposure being deemed “held” by such Lender for purposes of this definition); provided that the Commitment of, and the portion of the Loans held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Majority Lenders; provided further that at all times when two or more Lenders are party to this Agreement, the term “Majority Lenders” shall in no event mean less than two Lenders unless only two Lenders are party to this Agreement and one of such Lenders is a Defaulting Lender
“Management Company” means the manager of the Real Property owned by EDR or a Subsidiary of EDR.
“Material Adverse Effect” means a material adverse effect on (a) the business, assets, operations, or condition, financial or otherwise, of (i) the Borrower and its Subsidiaries, other than owners of Real Property in the Unencumbered Pool, and the Guarantor, taken as a whole, or (ii) any owner of Real Property in the Unencumbered Pool, (b) the ability of any of the Credit Parties to perform their obligations under the Loan Documents or (c) the rights of or benefits available to the Administrative Agent or the Lenders under the Loan Documents.
“Material Contract” means any contract or other arrangement (other than Loan Documents), whether written or oral, to which any Credit Party is a party as to which the breach, nonperformance, cancellation or failure to renew by any party thereto could reasonably be expected to have a Material Adverse Effect.
“Material Indebtedness” means Indebtedness (other than the Loans and Letters of Credit), or obligations in respect of one or more Hedging Agreements, of the Borrower, the other Credit Parties, or any Property Subsidiary in an aggregate principal amount exceeding $10,000,000.
“Maturity Date” means November 19, 2018, as the same may be extended in accordance with Section 2.20.
“Maximum Loan Available Amount” means, on any date, an amount equal to the aggregate Commitments.
“Maximum Rate” shall have the meaning set forth in Section 9.13.
“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto or assignee of the business of such company in the business of rating debt.
“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“Net Operating Income” shall mean, for any income producing operating Real Property, the difference between (a) any rentals, proceeds and other income received from such property, including early lease termination penalties to the extent no new tenant is in place and allocated over the applicable remaining term (but excluding (i) security or other deposits, and (ii) other income of a non-recurring nature) during the determination period, less (b) an amount equal to all costs and expenses (excluding Interest Expense, non-cash straight line ground rent as determined in accordance with GAAP, any expenditures that are capitalized in accordance with GAAP, non-cash expenses such as depreciation and amortization, and as approved by the Administrative Agent, such approval not to be unreasonably withheld, any extraordinary, non-recurring expenses associated with any financing, merger, acquisition, divestiture, or other capital transaction) incurred as a result of, or in connection with, or properly allocated to, the operation or leasing of such property during the determination period; provided, however, that the amount for the expenses for the management of a property included in clause (b) above shall be set at three percent (3%) of (I) the amount provided
in clause (a) above, less (II) a bad debt allowance. Net Operating Income shall be calculated based on the immediately preceding four (4) calendar quarters unless the Real Property has not been owned by the Borrower or its Subsidiaries for four (4) calendar quarters, in which event (i) Net Operating Income shall be calculated for the period of ownership, and annualized, and (ii) if the period of ownership includes the month of August, the Net Operating Income for August will be disregarded in the annualization calculation. Net Operating Income shall be calculated on a consolidated basis in accordance with GAAP, and including (without duplication) the Equity Percentage of Net Operating Income for the Borrower’s Unconsolidated Affiliates.
“Note” means a promissory note in the form attached hereto as Exhibit D payable to a Lender evidencing certain of the obligations of the Borrower to such Lender and executed by Borrower, as the same may be amended, supplemented, modified or restated from time to time; “Notes” means, collectively, all of such Notes outstanding at any given time.
“Obligations” means, individually and collectively: (a) the aggregate principal balance of, and all accrued and unpaid interest on, all Loans; (b) all reimbursement obligations and all other obligations related to any Letter of Credit; and (c) all other indebtedness, liabilities, obligations, covenants and duties of the Borrower owing to the Administrative Agent, the Issuing Bank or any Lender of every kind, nature and description, under or in respect of this Agreement or any of the other Loan Documents, including, without limitation, any fees and indemnification obligations, whether direct or indirect, absolute or contingent, due or not due, contractual or tortious, liquidated or unliquidated, and whether or not evidenced by any promissory note.
"OFAC” means the U.S. Department of the Treasury's Office of Foreign Assets Control, and any successor thereto.
“Other Taxes” means any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement, and not including the Excluded Taxes or the Excluded FATCA Taxes.
“Parent” means Education Realty Trust, Inc., a Maryland corporation and the parent of EDR.
“Participant” has the meaning given that term in Section 9.04(c).
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
“Permitted Encumbrances” means:
(a) Liens imposed by law for taxes that are not yet due or are being contested in compliance with Section 5.05;
(b) pledges and deposits made in the ordinary course of business in compliance with workers' compensation, unemployment insurance and other social security laws or regulations;
(c) deposits to secure the performance of bids, trade contracts, purchase, construction or sales contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business;
(d) the Title Instruments and Liens which do not secure Indebtedness and other customary matters;
(e) uniform commercial code protective filings with respect to personal property leased to the Borrower or any Subsidiary; and
(f) landlords’ liens for rent not yet due and payable;
provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.
“Permitted Investments” means:
(a) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days from the date of acquisition thereof and having an investment grade credit rating on the date of acquisition;
(c) investments in certificates of deposit, banker's acceptances and time deposits maturing within 180 days from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof which has a combined capital and surplus and undivided profits of not less than $500,000,000;
(d) fully collateralized repurchase agreements with a term of not more than 90 days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria described in clause (c) above; and
(e) investments in Subsidiaries and Unconsolidated Affiliates made in accordance with this Agreement.
“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
“Plan” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“Prime Rate” means the rate of interest per annum publicly announced from time to time by KeyBank, National Association, as its prime rate in effect at its principal office in Cleveland,
Ohio; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.
“Property Subsidiary” means each Subsidiary of the Borrower that owns an Acceptable Unencumbered Property in the Unencumbered Pool.
“Real Property” means, collectively, all interest in any land and improvements located thereon (including direct financing leases of land and improvements owned by a Person), together with all equipment, furniture, materials, supplies and personal property now or hereafter located at or used in connection with the land and all appurtenances, additions, improvements, renewals, substitutions and replacements thereof now or hereafter acquired by any Person.
“Register” has the meaning set forth in Section 9.04.
“Related Parties” means, with respect to any specified Person, such Person's Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person's Affiliates.
“Release” means any release, spill, emission, leaking, pumping, pouring, dumping, emptying, injection, deposit, disposal, discharge, dispersal, leaching or migration on or into the indoor or outdoor environment or into or out of any property.
“Remedial Action” means all actions, including without limitation any capital expenditures, required or necessary to (i) clean up, remove, treat or in any other way address any Hazardous Material; (ii) prevent the Release or threat of Release, or minimize the further Release, of any Hazardous Material so it does not migrate or endanger public health or the environment; (iii) perform pre-remedial studies and investigations or post-remedial monitoring and care; or (iv) bring facilities on any property owned or leased by the Borrower or any of its Subsidiaries into compliance with all Environmental Laws.
“Required Lenders” means, as of any date of determination, Lenders having in excess of 66 and 2/3% of the aggregate Commitments or, if the commitment of each Lender to make Loans and the obligation of the Issuing Bank to issue Letters of Credit have been terminated pursuant to Article VII, Lenders holding in the aggregate in excess of 66 and 2/3% of the aggregate Loans (with the aggregate amount of each Lender’s risk participation and funded participation in L/C Exposure being deemed “held” by such Lender for purposes of this definition); provided that the Commitment of, and the portion of the Loans held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders; provided further that at all times when two or more Lenders are party to this Agreement, the term “Required Lenders” shall in no event mean less than two Lenders unless only two Lenders are party to this Agreement and one of such Lenders is a Defaulting Lender.
“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any ownership interests in the Borrower, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such ownership
interests in the Borrower or any option, warrant or other right to acquire any such shares of capital stock of the Borrower.
“Revolving Credit Exposure” means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender's Revolving Loans and its LC Exposure and Swingline Exposure at such time.
“Revolving Loan” means a Loan made pursuant to Section 2.01.
“S&P” means Standard & Poor’s Financial Services LLC, a subsidiary of The McGraw‑Hill Companies, Inc., or any successor or assignee of the business of such division in the business of rating debt.
"Sanctioned Country” means, at any time, any country or territory which is itself the subject or target of any comprehensive Sanctions.
"Sanctioned Person” means, at any time, (a) any Person or group listed in any Sanctions-related list of designated Persons maintained by OFAC or the U.S. Department of State, the United Nations Security Council, the European Union or any EU Member State, (b) any Person or group operating, organized or resident in a Sanctioned Country to the extent such Person is subject to Sanctions, (c) any agency, political subdivision or instrumentality of the government of a Sanctioned Country, or (d) any Person 50% or more owned, directly or indirectly, by any of the above.
"Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State or (b) the United Nations Security Council, the European Union or Her Majesty's Treasury of the United Kingdom.
“Secured Debt” means all Indebtedness, whether on a recourse or a non-recourse basis, which is secured by a Lien on any asset of any Person.
“Secured Recourse Debt” means all Secured Debt of any Person on a recourse basis.
“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Governmental Authority to which the Administrative Agent is subject, with respect to the Adjusted LIBO Rate, for Eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute Eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
“Subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent's consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent. EDR is a Subsidiary of the Parent.
“Swingline Exposure” means, at any time, the aggregate principal amount of all Swingline Loans outstanding at such time. The Swingline Exposure of any Lender at any time shall be its Applicable Percentage of the total Swingline Exposure at such time.
“Swingline Lender” means KeyBank, National Association, in its capacity as lender of Swingline Loans hereunder.
“Swingline Loan” means a Loan made pursuant to Section 2.04.
“Tangible Net Worth” shall mean total assets (without deduction for accumulated depreciation) less (1) all intangibles and (2) all liabilities (including contingent and indirect liabilities), all determined in accordance with GAAP. The term "intangibles" shall include, without limitation, (i) deferred charges, and (ii) the aggregate of all amounts appearing on the assets side of any such balance sheet for franchises, licenses, permits, patents, patent applications, copyrights, trademarks, trade names, goodwill, treasury stock, experimental or organizational expenses and other like intangibles. The term "liabilities" shall include, without limitation, (i) Indebtedness secured by Liens on Property of the Person with respect to which Tangible Net Worth is being computed whether or not such Person is liable for the payment thereof, (ii) deferred liabilities, and (iii) Capital Lease Obligations. Tangible Net Worth shall be calculated on a consolidated basis in accordance with GAAP.
“Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority.
“Term Facility” means that certain Amended and Restated Credit Agreement dated November 19, 2014 entered into between PNC Bank, National Association, as administrative agent, the various lenders party thereto, and the Borrower, as may be amended from time to time.
“Term Facility Amount” means, from time to time, the aggregate amounts outstanding under the Term Facility.
“Title Instruments” means all instruments of record in the Office of the County Clerk, the Real Property Records or of any other Governmental Authority affecting title to all or any part of the Real Property in the Unencumbered Pool, including but not limited to those (if any) which
impose restrictive covenants, easements, rights-of-way or other encumbrances on all or any part of the Real Property in the Unencumbered Pool.
“Total Asset Value” means the sum of (without duplication) (a) the aggregate Value of all of Borrower’s and its Subsidiaries’ Real Property and other assets as set forth in the definition of Value, plus (b) the amount of any cash and cash equivalents, excluding tenant security and other restricted deposits of the Borrower and its Subsidiaries. Total Asset Value shall be calculated on a consolidated (inclusive of the Equity Percentage in Unconsolidated Affiliates and unconsolidated joint ventures) basis in accordance with GAAP.
“Total Leverage Ratio” shall mean the ratio (expressed as a percentage) of (a) the Indebtedness of the Consolidated Group to (b) Total Asset Value.
“Total Secured Debt Ratio” shall mean the ratio (expressed as a percentage) of (a) the Secured Debt of the Consolidated Group to (b) Total Asset Value.
“Total Unsecured Debt to Unencumbered Asset Value Ratio” shall mean the ratio (expressed as a percentage) of (a) the Unsecured Debt of the Consolidated Group to (b) Unencumbered Asset Value.
“Transactions” means the execution, delivery and performance by the Credit Parties of the Loan Documents, the borrowing of Loans, the use of the proceeds thereof and the issuance of Letters of Credit hereunder.
“Type,” when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.
“Unconsolidated Affiliate” means, without duplication, in respect of any Person, any other Person (other than a Person whose stock is traded on a national trading exchange) in whom such Person holds a voting equity or ownership interest and whose financial results would not be consolidated under GAAP with the financial results of such Person on the consolidated financial statements of such Person.
“Unencumbered Asset Value” means the sum of the aggregate Value of the Acceptable Unencumbered Properties, provided that the aggregate Value of Acceptable Unencumbered Properties of Subsidiaries that are not wholly-owned (directly or indirectly) by the Borrower shall not exceed fifteen percent (15%) of the total Unencumbered Asset Value.
“Unencumbered NOI” means, Net Operating Income for the prior four fiscal quarters from Acceptable Unencumbered Properties included in the Unencumbered Pool.
“Unencumbered Pool” has the meaning set forth in Section 5.12.
“Unused Fee” has the meaning set forth in Section 2.11(a).
“Unsecured Debt” means all Indebtedness of any Person which is not Secured Debt.
“Unsecured Interest Expense” means the actual interest expense on account of all Unsecured Debt (including the Revolving Credit Exposure) of the Consolidated Group for the most recently ended four (4) quarters.
“Unsecured Interest Coverage Ratio” shall mean the ratio of (i) Adjusted Unencumbered NOI for the most recently ended four (4) quarters to (b) Unsecured Interest Expense.
“Value” means the sum of the following:
(a) for Real Property that has been owned by the Borrower, its Subsidiary or an Unconsolidated Affiliate for twelve (12) months or longer, the Net Operating Income for the most recently ended four fiscal (4) quarters for such Real Property, and then divided by six-and-one half percent (6.50%); plus
(b) for Real Property that was acquired by the Borrower, its Subsidiary or an Unconsolidated Affiliate less than twelve (12) months prior to the date of calculation, the Historical Value of such Real Property; plus
(c) for Real Property that is an Asset Under Development or undeveloped land, the Historical Value of the subject property; plus
(d) for Real Property that was an Asset Under Development but has been open and operating for less than twelve (12) months, the Historical Value of such Real Property or, at the Borrower’s election (which election shall be irrevocable with respect to such Real Property once made until such time as such Real Property has been open and operated by the Borrower for at least twelve (12) months or longer, at which time the provisions of subsection (a) above shall control), the Net Operating Income for such Real Property calculated for the period of operation instead of the period of ownership, annualized, and then divided by six-and-one half percent (6.50%); plus
(e) the value of any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases under GAAP and included as Indebtedness plus
(f) the book value of any loan receivables secured by Real Property.
“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02 Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Class (e.g., a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar Revolving Loan”). Borrowings also may be classified and referred to by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).
SECTION 1.03 Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes,” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person's successors and assigns, (c) the words “herein,” “hereof,” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights. All references to the Borrower shall be deemed to be references to all Persons constituting the Borrower or each of them (whichever the context requires) and the obligations of such Persons under this Agreement and the other Loan Documents shall be joint and several as they relate to the Borrower.
SECTION 1.04 Accounting Terms; GAAP. Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith. All financial definitions and covenants shall be calculated on a consolidated basis, and with the impact and results for any non-wholly owned Subsidiary or Affiliate being determined by multiplying the applicable amount by the percentage of Borrower’s ownership interest in such non-wholly owned Subsidiary or Affiliate.
ARTICLE II
The Credits
SECTION 2.01 Commitments. Subject to the terms and conditions set forth herein, each Lender agrees to make Revolving Loans to the Borrower from time to time during the Availability Period in an aggregate principal amount that will not result in (i) such Lender's Revolving Credit Exposure exceeding such Lender's Commitment or (ii) the sum of the total Revolving Credit Exposures exceeding the total Maximum Loan Available Amount; provided however, that no Lender shall be obligated to make a Revolving Loan in excess of such Lender’s
Applicable Percentage of the difference between the Maximum Loan Available Amount and the Revolving Credit Exposure. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Revolving Loans.
SECTION 2.02 Loans and Borrowings.
(a) Each Revolving Loan shall be made as part of a Borrowing consisting of Revolving Loans made by the Lenders ratably in accordance with their respective Commitments. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender's failure to make Loans as required.
(b) Subject to Section 2.13, each Revolving Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request in accordance herewith. Each Swingline Loan shall be an ABR Loan. Each Lender at its option may make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of $100,000 and not less than $1,000,000. At the time that each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of $100,000 and not less than $1,000,000, provided that an ABR Revolving Borrowing may be in an aggregate amount that is equal to the entire unused balance of the total Commitments or that is required to finance the reimbursement of an LC Disbursement as contemplated by Section 2.05(e). Each Swingline Loan shall be in an amount that is an integral multiple of $100,000 and not less than $1,000,000. Borrowings of more than one Type and Class may be outstanding at the same time; provided that there shall not at any time be more than a total of six (6) Eurodollar Borrowings outstanding.
(d) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Maturity Date.
SECTION 2.03 Requests for Revolving Borrowings. To request a Revolving Borrowing, EDR (on behalf of the Borrower) shall notify the Administrative Agent of such request by telephone (a) in the case of a Eurodollar Borrowing, not later than 12:00 noon, Boston, Massachusetts time, three Business Days before the date of the proposed Borrowing or (b) in the case of an ABR Borrowing, not later than 12:00 noon, Boston, Massachusetts time, one Business Day before the date of the proposed Borrowing; provided that any such notice of an ABR Borrowing to finance the reimbursement of an LC Disbursement as contemplated by Section 2.05(e) may be given not later than 11:00 a.m., Boston, Massachusetts time, on the date of the proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Borrowing Request in the form
of Exhibit E attached hereto and hereby made a part hereof and signed by EDR, on behalf of the Borrower. Each such telephonic and written Borrowing Request shall specify the following information in compliance with Section 2.02:
(i) the aggregate amount of the requested Borrowing;
(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
(iv) in the case of a Eurodollar Borrowing, the Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; and
(v) the location and number of the Borrower's account to which funds are to be disbursed, which shall comply with the requirements of Section 2.06.
If no election as to the Type of Revolving Borrowing is specified in the Borrowing Request, then the requested Revolving Borrowing shall be an ABR Borrowing. If no Interest Period is specified with respect to any requested Eurodollar Borrowing, then the Borrower shall be deemed to have selected an Interest Period of one month's duration, in the case of a Eurodollar Borrowing. Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender's Loan to be made as part of the requested Borrowing.
SECTION 2.04 Swingline.
(a) Subject to the terms and conditions set forth herein, the Swingline Lender agrees to make Swingline Loans to the Borrower from time to time during the Availability Period, in an aggregate principal amount at any time outstanding that will not result in (i) the aggregate principal amount of outstanding Swingline Loans exceeding $50,000,000.00 or (ii) the sum of the total Revolving Credit Exposures exceeding the total Maximum Loan Available Amount; provided that the Swingline Lender shall not be required to make a Swingline Loan to refinance an outstanding Swingline Loan. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, prepay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall notify the Administrative Agent of such request by telephone (confirmed by telecopy), not later than 2:00 p.m., Boston, Massachusetts time, on the day of a proposed Swingline Loan. Each such notice shall be irrevocable and shall specify the requested date (which shall be a Business Day) and amount of the requested Swingline Loan. The Administrative Agent will promptly advise the Swingline Lender of any such notice received from the Borrower. The Swingline Lender shall make each Swingline Loan available to the Borrower by means of a credit to the general deposit account of the Borrower with the Swingline Lender (or, in the case of a Swingline
Loan made to finance the reimbursement of an LC Disbursement as provided in Section 2.05(e), by remittance to the Issuing Bank) by 4:00 p.m., Boston, Massachusetts time, on the requested date of such Swingline Loan.
The Swingline Lender may by written notice given to the Administrative Agent not later than 10:00 a.m., Boston, Massachusetts time, on any Business Day require the Lenders to acquire participations on such Business Day in all or a portion of the Swingline Loans outstanding. Such notice shall specify the aggregate amount of Swingline Loans in which Lenders will participate. Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Lender, specifying in such notice such Lender's Applicable Percentage of such Swingline Loan or Loans. Each Lender hereby absolutely and unconditionally agrees, within two (2) Business Days after receipt of notice as provided above, to pay to the Administrative Agent, for the account of the Swingline Lender, such Lender's Applicable Percentage of such Swingline Loan or Loans. Each Lender acknowledges and agrees that its obligation to acquire participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever, provided no Lender shall be required to acquire a participation in a Swingline Loan to the extent same would result in such Lender's Revolving Credit Exposure exceeding such Lender's Commitment. Each Lender shall comply with its obligation under this paragraph by wire transfer of immediately available funds, in the same manner as provided in Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the Swingline Lender the amounts so received by it from the Lenders. The Administrative Agent shall notify the Borrower of any participations in any Swingline Loan acquired pursuant to this paragraph, and thereafter payments in respect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender. Any amounts received by the Swingline Lender from the Borrower (or other party on behalf of the Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative Agent; any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Lenders that shall have made their payments pursuant to this paragraph and to the Swingline Lender, as their interests may appear, in each instance in accordance with Section 2.17(a); provided that any such payment so remitted shall be repaid to the Swingline Lender or to the Administrative Agent, as applicable, if and to the extent such payment is required to be refunded to the Borrower for any reason. The purchase of participations in a Swingline Loan pursuant to this paragraph shall not relieve the Borrower of any default in the payment thereof.
SECTION 2.05 Letters of Credit.
(a) General. Subject to the terms and conditions set forth herein, the Borrower may request the issuance of Letters of Credit for its own account in a form reasonably acceptable to the Administrative Agent and the Issuing Bank, at any time and from time to time prior to thirty (30) days before the termination of the Availability Period. In the event of any inconsistency between the terms and conditions of this Agreement and the terms and
conditions of any form of letter of credit application or other agreement submitted by the Borrower to, or entered into by the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To request the issuance of a Letter of Credit (or the amendment, renewal or extension of an outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for doing so have been approved by the Issuing Bank) to the Issuing Bank and the Administrative Agent (reasonably in advance of the requested date of issuance, amendment, renewal or extension) a notice requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the amount of such Letter of Credit, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or extend such Letter of Credit. The Administrative Agent shall remit a copy of such request to the Lenders. If requested by the Issuing Bank, the Borrower also shall submit a letter of credit application on the Issuing Bank's standard form in connection with any request for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or extended only if (and upon issuance, amendment, renewal or extension of each Letter of Credit the Borrower shall be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or extension (i) the LC Exposure shall not exceed $75,000,000, (ii) the total Revolving Credit Exposures shall not exceed the total Maximum Loan Available Amount, and (iii) the face amount of the subject Letter of Credit shall not be less than $100,000. The Issuing Bank shall have no obligation to issue a Letter of Credit if a default of any Lender’s obligations to fund any amount under this Agreement exists or any Lender is at such time a Defaulting Lender hereunder, unless the Issuing Bank has entered into satisfactory arrangements with the Borrower or such Lender to eliminate the Issuing Bank’s risk with respect to such Lender (with cash collateral pledged to the Issuing Bank in the amount of such defaulting or Defaulting Lender’s pro rata portion of the Letter of Credit being deemed satisfactory).
(c) Expiration Date. Each Letter of Credit shall expire not later than the close of business on the date that is thirty (30) days prior to the Maturity Date unless (1) all the Lenders have approved such expiry date, or (2) the Borrower agrees to deliver to the Administrative Agent no later than sixty (60) days prior to the Maturity Date cash collateral in an amount equal to the undrawn amount of such Letter of Credit, with the Borrower hereby irrevocably requesting a Revolving Borrowing of an ABR Loan to fund such cash collateral payment in the event the Borrower does not deliver such cash collateral to the Administrative Agent on the due date thereof.
(d) Participations. By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount thereof) and without any further action on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby grants to each Lender, and each Lender hereby acquires from the Issuing Bank, a participation in such Letter of Credit equal
to such Lender's Applicable Percentage of the aggregate amount available to be drawn under such Letter of Credit. In consideration and in furtherance of the foregoing, each Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Lender's Applicable Percentage of each LC Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section, or of any reimbursement payment required to be refunded to the Borrower for any reason. Each Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever, provided no Lender shall be required to acquire a participation in a Letter of Credit to the extent same would result in such Lender's Revolving Credit Exposure exceeding such Lender's Commitment.
(e) Reimbursement. If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to the Administrative Agent an amount equal to such LC Disbursement not later than 12:00 noon, Boston, Massachusetts time, on the Business Day that such LC Disbursement is made, if the Borrower shall have received notice of such LC Disbursement prior to 10:00 a.m., Boston, Massachusetts time, on such date, or, if such notice has not been received by the Borrower prior to such time on such date, then on the Business Day immediately following the day that the Borrower receives such notice, if such notice is not received prior to such time on the day of receipt; provided that the Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 that such payment be financed with an ABR Revolving Borrowing or Swingline Loan in an equivalent amount and, to the extent so financed, the Borrower's obligation to make such payment shall be discharged and replaced by the resulting ABR Revolving Borrowing or Swingline Loan. If the Borrower fails to make such payment when due, the Administrative Agent shall notify each Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Lender's Applicable Percentage thereof. Promptly following receipt of such notice, each Lender shall pay to the Administrative Agent its Applicable Percentage of the payment then due from the Borrower, in the same manner as provided in Section 2.06 with respect to Loans made by such Lender (and Section 2.06 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the Issuing Bank the amounts so received by it from the Lenders. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to the Issuing Bank or, to the extent that Lenders have made payments pursuant to this paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing Bank as their interests may appear. Any payment made by a Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the funding of ABR Revolving Loans or a Swingline Loan as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement.
(f) Obligations Absolute. The Borrower's obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrower's obligations hereunder. Neither the Administrative Agent, the Lenders nor the Issuing Bank, nor any of their Related Parties, shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided that the foregoing shall not be construed to excuse the Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower that are caused by the Issuing Bank's failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of the Issuing Bank, the Issuing Bank shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.
(g) Disbursement Procedures. The Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit. The Issuing Bank shall promptly notify the Administrative Agent and the Borrower by telephone (confirmed by telecopy) of such demand for payment and whether the Issuing Bank has made or will make an LC Disbursement thereunder; provided that any failure to give or delay in giving such notice shall not relieve the Borrower of its obligation to reimburse the Issuing Bank and the Lenders with respect to any such LC Disbursement.
(h) Interim Interest. If the Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the date such LC Disbursement is made to but excluding the date that the Borrower reimburses such LC Disbursement, at the rate per annum then applicable to ABR Revolving Loans; provided that, if the Borrower fails to reimburse such LC Disbursement when due pursuant to paragraph (e) of this Section, then Section 2.12(c) shall apply. Interest accrued pursuant to this paragraph shall be for the account of the Issuing Bank, except that interest accrued on and after the date of payment by any Lender pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be for the account of such Lender to the extent of such payment.
(i) Replacement of the Issuing Bank. The Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent shall notify the Lenders of any such replacement of the Issuing Bank. At the time any such replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.11(d). From and after the effective date of any such replacement, (i) the successor Issuing Bank shall have all the rights and obligations of the Issuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require. After the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such replacement, but shall not be required to issue additional Letters of Credit.
(j) Cash Collateralization. If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the Administrative Agent demanding the deposit of cash collateral pursuant to this paragraph, the Borrower shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders, an amount in cash equal to the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to the Borrower described in clause (g) or (h) of Article VII. Such deposit shall be held by the Administrative Agent as collateral for the payment and performance of the obligations of the Borrower under this Agreement. The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any interest earned on the investment of such deposits, which investments shall be made at the option and sole discretion of the Administrative Agent and at the Borrower's risk and expense, such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such account shall be applied by the Administrative Agent to reimburse the
Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of Required Lenders), be applied to satisfy other obligations of the Borrower under this Agreement, provided that, to the extent such obligations are owed to Lenders, such application shall be on a pro rata basis. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the Borrower within three Business Days after all Events of Default have been cured or waived.
SECTION 2.06 Funding of Borrowings.
(a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, Boston, Massachusetts time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders; provided that Swingline Loans shall be made as provided in Section 2.04. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account of the Borrower and designated by the Borrower in the applicable Borrowing Request; provided that ABR Revolving Loans made to finance the reimbursement of an LC Disbursement as provided in Section 2.05(e) shall be remitted by the Administrative Agent to the Issuing Bank.
(b) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender's share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest rate applicable to the corresponding Loan made to the Borrower. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender's Loan included in such Borrowing.
SECTION 2.07 Interest Elections.
(a) Each Revolving Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Revolving Borrowing, shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the
Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar Revolving Borrowing, may elect Interest Periods therefor, all as provided in this Section. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing. This Section shall not apply to Swingline Loans, which may not be converted or continued.
(b) To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Revolving Borrowing of the Type resulting from such election to be made on the effective date of such election. Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Interest Election Request in the form of a Borrowing Request (with proper election made for an interest rate election only) and signed by the Borrower.
(c) Each telephonic and written Interest Election Request shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.
If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.
(d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurodollar Revolving Borrowing prior to the end of the Interest Period applicable thereto,
then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Revolving Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Revolving Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.
SECTION 2.08 Termination, Reduction and Increase of Commitments.
(a) Unless previously terminated by the Administrative Agent or Borrower in accordance with this Agreement, the Commitments shall terminate on the Maturity Date.
(b) The Borrower may only reduce the Commitments without the prior written consent of the Administrative Agent and all of the Lenders in the following circumstances: the Borrower may from time to time reduce the Commitments, provided that each reduction in the Commitments shall be in an amount that is at least $5,000,000 and an integral multiple of $500,000, and the total Commitments may not be reduced to less than an aggregate of $50,000,000 unless the Commitments are reduced to zero and terminated. The Borrower shall not reduce the Commitments if, after giving effect to any concurrent prepayment of the Loans in accordance with Section 2.10, the total Revolving Credit Exposures would exceed the aggregate Commitments as reduced. After any reduction in the Commitments, the Borrower’s option to increase the Commitments provided in Section 2.08(d) shall terminate.
(c) The Borrower shall notify the Administrative Agent of any election to reduce the Commitments under Section 2.08(b) at least three (3) Business Days prior to the effective date of such reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section shall be irrevocable. Any reduction of the Commitments shall be permanent. Each reduction in the Commitments shall be made ratably among the Lenders in accordance with their respective Commitments.
(d) So long as the Borrower is not then in Default, and the Borrower has not previously decreased the Commitments under Section 2.08(b), the Borrower may, prior to November 19, 2018, request that the Commitments be increased, so long as (a) each increase is in a minimum amount of $10,000,000.00 and an integral multiple of $5,000,000 (or such smaller amounts as the Administrative Agent may approve), (b) the Borrower has not previously reduced the Commitments, and (c) the aggregate Commitments do not exceed $1,000,000,000.00 (the “Maximum Commitment”). If the Borrower requests that the total Commitments be increased, the Administrative Agent shall use its best efforts to obtain increased or additional commitments up to the Maximum Commitment, and to do so the Administrative Agent may obtain additional lenders of its choice (and approved by Borrower, such approval not to be unreasonably withheld or delayed), and without the necessity of
approval from any of the Lenders. The Borrower and each other Credit Party shall execute an amendment to this Agreement, additional Notes and other documents as the Administrative Agent may reasonably require to evidence the increase of the Commitments, the addition of new Real Property to the Unencumbered Pool, if applicable, and the admission of additional Persons as Lenders, if necessary.
SECTION 2.09 Repayment of Loans; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay (i) to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Revolving Loan on the Maturity Date, and (ii) subject to Section 2.04, to the Swingline Lender the then unpaid principal amount of each Swingline Loan on the earlier of the Maturity Date and the first date after such Swingline Loan is made that is five (5) Business Days after such Swingline Loan is made; provided that on each date that a Revolving Borrowing is made, the Borrower shall repay all Swingline Loans then outstanding. At the request of each Lender, the Loans made by such Lender shall be evidenced by a Note payable to such Lender in the amount of such Lender’s Commitment.
(b) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.
(c) The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Class and Type thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.
SECTION 2.10 Prepayment of Loans.
(a) The Borrower shall have the right at any time and from time to time to prepay, without penalty, any Borrowing in whole or in part, subject to prior notice in accordance with paragraph (b) of this Section, and subject to Section 2.15, if applicable.
(b) The Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swingline Loan, the Swingline Lender) by telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Revolving Borrowing, not later than 11:00 a.m., Boston, Massachusetts time, three (3)
Business Days before the date of prepayment, (ii) in the case of prepayment of an ABR Revolving Borrowing, not later than 11:00 a.m., Boston, Massachusetts time, one Business Day before the date of prepayment, or (iii) in the case of prepayment of a Swingline Loan, not later than 12:00 noon, Boston, Massachusetts time, on the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid. Promptly following receipt of any such notice relating to a Revolving Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Revolving Borrowing shall be in an amount that is an integral multiple of $100,000 and not less than $500,000. Each prepayment of a Revolving Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to the extent required by Section 2.12.
(c) In connection with the prepayment of any Loan prior to the expiration of the Interest Period applicable thereto, the Borrower shall also pay any applicable expenses pursuant to Section 2.15.
(d) Amounts to be applied to the prepayment of Loans pursuant to any of the preceding subsections of this Section shall be applied, first, to reduce outstanding ABR Loans and next, to the extent of any remaining balance, to reduce outstanding Eurodollar Loans. Each such prepayment shall be applied to prepay ratably the Loans of the Lender.
(e) If at any time the total Revolving Credit Exposure of the Lenders exceeds the then effective Maximum Loan Available Amount, the Borrower shall prepay the Loans in an amount equal to such excess within one (1) Business Day after such occurrence.
SECTION 2.11 Fees.
(a) The Borrower agrees to pay to the Administrative Agent for the pro rata account of each Lender an unused fee (the “Unused Fee”), which Unused Fee shall accrue at (i) 0.25% per annum on the average daily unused amount of the aggregate Commitments of the Lenders, to the extent utilization is less than or equal to fifty percent (50%) of the aggregate Commitments and (ii) 0.15% per annum on the average daily unused amount the aggregate Commitments of the Lenders, to the extent utilization is greater than fifty percent (50%) of the aggregate Commitments, in each case, during the period from and including the date of this Agreement to, but excluding, the earlier of (x) the date on which such Commitments terminate, and (y) the date on which the Parent elects to use the Applicable Rate set forth in clause (b) of the definition of Applicable Rate.
(b) Commencing on the date the Parent elects to use the Applicable Rate set forth in clause (b) of the definition of Applicable Rate, the Borrower agrees to pay to the Administrative Agent for the pro rata account of each Lender a facility fee (the “Facility Fee”), which Facility Fee shall accrue at the per annum rate referenced in the grid set forth in clause (b) of the definition of Applicable Rate, on the aggregate Commitments of the Lenders, during the period from and including the date on which the Parent makes such election to, but excluding, the date on which such Commitment terminates.
(c) Unused Fees or Facility Fees set forth in (a) and (b) above accrued through and including the last day of March, June, September and December of each year shall be payable on the third Business Day following such last day and on the date on which the Commitments terminate, commencing on the first such date to occur after the date hereof; provided that any such fees accruing after the date on which the Commitments terminate shall be payable on demand. All Unused Fees or Facility Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).
(d) The Borrower agrees to pay (i) to the Administrative Agent for the account of each Lender a participation fee with respect to its participations in Letters of Credit, which shall accrue at the Applicable Rate provided for Eurodollar Revolving Loans on the average daily amount of such Lender's LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including the date of this Agreement to but excluding the later of the date on which such Lender's Commitment terminates and the date on which such Lender ceases to have any LC Exposure, provided, however, any Letter of Credit Fees otherwise payable for the account of a Defaulting Lender with respect to any Letter of Credit as to which such Defaulting Lender has not provided cash collateral satisfactory to the Issuing Bank shall be payable, to the maximum extent permitted by applicable Legal Requirements, to the other Lenders in accordance with the upward adjustments in their respective Applicable Percentages allocable to such Letter of Credit pursuant to Section 2.18(a)(iv) with the balance of such fee, if any, payable to the Issuing Bank for its own account, and (ii) to the Issuing Bank a fronting fee, in the amount of 0.125% of the face amount of each Letter of Credit (but not less than $500.00 for each Letter of Credit). Participation fees accrued through and including the last day of March, June, September and December of each year shall be payable on the third Business Day following such last day, commencing on the first such date to occur after the date of this Agreement; provided that all such fees shall be payable on the date on which the Commitments terminate and any such fees accruing after the date on which the Commitments terminate shall be payable on demand. Fronting fees shall be payable in full in advance on the date of the issuance, or renewal or extension of each Letter of Credit, and are not refundable. Any other fees payable to the Issuing Bank pursuant to this paragraph shall be payable within 10 days after demand. All participation fees and fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).
(e) The Borrower agrees to pay to the Administrative Agent, for its own account, fees payable in the amounts and at the times separately agreed upon between the Borrower and the Administrative Agent.
(f) All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent (or to the Issuing Bank, in the case of fees payable to it) for distribution, in the case of facility fees and participation fees, to the Lenders. Fees paid shall not be refundable under any circumstances.
(g) In the event that the Maturity Date is extended in accordance with the terms of Section 2.20, the Borrower agrees to pay to the Administrative Agent for the account of each Lender an extension fee equal to 0.15% of the aggregate Commitments on the first effective day of the extension.
SECTION 2.12 Interest.
(a) The Loans comprising each ABR Borrowing (including each Swingline Loan) shall bear interest at the lesser of (x) the Alternate Base Rate plus the Applicable Rate, or (y) the Maximum Rate.
(b) The Loans comprising each Eurodollar Borrowing shall bear interest at the lesser of (a) the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate, or (b) the Maximum Rate.
(c) Notwithstanding the foregoing, (A) if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, the lesser of (x) 4% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section, or (y) the Maximum Rate, or (ii) in the case of any other amount, the lesser of (x) 4% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section, or (y) the Maximum Rate; and (B) after the occurrence of any Event of Default, at the option of the Administrative Agent, or if the Administrative Agent is directed in writing by the Required Lenders to do so, the Loan shall bear interest at a rate per annum equal to the lesser of (x) 4% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section, or (y) the Maximum Rate.
(d) Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and, in the case of Revolving Loans, upon termination of the Commitments; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving Loan prior to the end of the Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Revolving Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a year of 360 days and twelve (12) 30-day months, and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.
SECTION 2.13 Alternate Rate of Interest. If prior to the commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders that (i) the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for such Interest Period and (ii) such fact is generally applicable to its loans of this type to similar borrowers, as evidenced by a certification from such Lenders;
then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that requests the conversion of any Revolving Borrowing to, or continuation of any Revolving Borrowing as, a Eurodollar Borrowing shall be ineffective, and (ii) if any Borrowing Request requests a Eurodollar Revolving Borrowing, such Borrowing shall be made as an ABR Borrowing; provided that if the circumstances giving rise to such notice affect only one Type of Borrowings, then the other Type of Borrowings shall be permitted.
SECTION 2.14 Increased Costs.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate) or the Issuing Bank; or
(ii) impose on any Lender or the Issuing Bank or the London interbank market any other condition (other than one relating to Excluded Taxes) affecting this Agreement or Eurodollar Loans made by such Lender or any Letter of Credit or participation therein;
and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or the Issuing Bank of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or the Issuing Bank hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank, as the case may be, for such additional costs incurred or reduction suffered.
(b) If any Lender or the Issuing Bank determines that any Change in Law regarding capital requirements has or would have the effect of reducing the rate of return on such Lender's or the Issuing Bank's capital or on the capital of such Lender's or the Issuing Bank's holding company, if any, as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the Issuing Bank, to a level below that which such Lender or the Issuing Bank or such Lender's or the Issuing Bank's holding company could have achieved but for such Change in Law (taking into consideration such Lender's or the Issuing Bank's policies and the policies of such Lender's or the Issuing Bank's holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank or such Lender's or the Issuing Bank's holding company for any such reduction suffered.
(c) A certificate of a Lender or the Issuing Bank setting forth the amount or amounts necessary to compensate such Lender or the Issuing Bank or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender or the Issuing Bank, as the case may be, the amount shown as due on any such certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender or the Issuing Bank to demand compensation pursuant to this Section shall not constitute a waiver of such Lender's or the Issuing Bank's right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender or the Issuing Bank pursuant to this Section for any increased costs or reductions incurred more than 270 days prior to the date that such Lender or the Issuing Bank, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender's or the Issuing Bank's intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 270-day period referred to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.15 Break Funding Payments. In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Revolving Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.10(b)), or (d) the assignment of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.19, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to such Loan, for the period from the date of such event to
the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the Eurodollar market. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.
SECTION 2.16 Taxes.
(a) Any and all payments by or on account of any obligation of the Borrower hereunder shall be made free and clear of and without deduction for any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Administrative Agent, Lender or Issuing Bank (as the case may be) receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent, each Lender and the Issuing Bank, within 10 days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by the Administrative Agent, such Lender or the Issuing Bank, as the case may be, on or with respect to any payment by or on account of any obligation of the Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender or the Issuing Bank, or by the Administrative Agent on its own behalf or on behalf of a Lender or the Issuing Bank, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law, such properly completed and executed documentation prescribed by applicable law or reasonably requested by the Borrower as will permit such payments to be made without withholding or at a reduced rate.
(f) Without limiting any other provision of this Agreement, if a payment made to a Lender or a Participant under any Loan Document would be subject to United States federal withholding Tax imposed by FATCA if such Lender or Participant were to fail to comply with any requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender or Participant shall (A) enter into such agreements with the Internal Revenue Service as necessary to establish an exemption from withholding under FATCA; (B) comply with any certification, documentation, information, reporting or other requirement necessary to establish an exemption from withholding under FATCA; (C) provide any documentation reasonably requested by the Borrower or the Administrative Agent sufficient for the Administrative Agent and the Borrower to comply with their respective obligations, if any, under FATCA and to determine that such Lender has complied such applicable requirements; and (D) provide a certification signed by the chief financial officer, principal accounting officer, treasurer or controller of such Lender certifying that such Lender or Participant has complied with any necessary requirements to establish an exemption from withholding under FATCA. To the extent that the relevant documentation provided pursuant to this paragraph is rendered obsolete or inaccurate in any material respect as a result of changes in circumstances with respect to the status of a Lender or Participant, such Lender or Participant shall, to the extent permitted by any Legal Requirement, deliver to the Borrower and the Administrative Agent revised and/or updated documentation sufficient for the Borrower and the Administrative Agent to confirm such Lender’s or such Participant’s compliance with its obligations under FATCA.
SECTION 2.17 Payments Generally; Pro Rata Treatment; Sharing of Set-offs.
(a) The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, fees or reimbursement of LC Disbursements, or of amounts payable under Section 2.14, 2.15 or 2.16, or otherwise) prior to 1:00 p.m., Boston, Massachusetts time, on the date when due, in immediately available funds, without set-off or counterclaim. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at its offices at 225 Franklin Street, Boston, Massachusetts, except payments to be made directly to the Issuing Bank or Swingline Lender as expressly provided herein and except that payments pursuant to Sections 2.14, 2.15, 2.16 and 9.03 shall be made directly to the Persons entitled thereto. If the Administrative Agent receives a payment for the account of a Lender prior to 1:00 p.m., Boston, Massachusetts time, such payment must be delivered to the Lender on the same day and if it is not so delivered due
to the fault of the Administrative Agent, the Administrative Agent shall pay to the Lender entitled to the payment interest thereon for each day after payment should have been received by the Lender pursuant hereto until the Lender receives payment, at the Federal Funds Effective Rate. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in Dollars.
(b) If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, unreimbursed LC Disbursements, interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal and unreimbursed LC Disbursements then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and unreimbursed LC Disbursements then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Revolving Loans or participations in LC Disbursements or Swingline Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Revolving Loans and participations in LC Disbursements and Swingline Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Revolving Loans and participations in LC Disbursements and Swingline Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Revolving Loans and participations in LC Disbursements and Swingline Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that the Borrower will not make such
payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the Federal Funds Effective Rate.
(e) If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.05(d) or (e), 2.06(b) or 2.17(d), then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender's obligations under such Sections until all such unsatisfied obligations are fully paid.
SECTION 2.18 Defaulting Lenders.
(a) Adjustments. Notwithstanding anything to the contrary contained in this Credit Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:
(i) Waivers and Amendments. That Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Credit Agreement shall be restricted as set forth in Section 9.02.
(ii) Reallocation of Payments. Any payment of principal, interest, fees or other amounts received by Administrative Agent for the account of a Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Section VII or otherwise, and including any amounts made available to Administrative Agent by that Defaulting Lender pursuant to Section 9.08), shall be applied at such time or times as may be determined by Administrative Agent as follows: first, to the payment of any amounts owing by that Defaulting Lender to Administrative Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing Bank hereunder; third, if so determined by Administrative Agent or requested by the Issuing Bank, to be held as cash collateral for future funding obligations of such Defaulting Lender of any participation in any outstanding and undrawn Letter of Credit; fourth, as the applicable Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Credit Agreement, as determined by Administrative Agent; fifth, if so determined by Administrative Agent and the applicable Borrower, to be held in a non-interest bearing deposit account and released in order to satisfy obligations of such Defaulting Lender to fund Loans under this Credit Agreement; sixth, to the payment of any amounts owing to the non-Defaulting Lenders or the Issuing Bank as a result of any judgment of a court of competent jurisdiction obtained by any
Lender or the Issuing Bank against such Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Credit Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the applicable Borrower as a result of any judgment of a court of competent jurisdiction obtained by such Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Credit Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if: (x) such payment is a payment of the principal amount of any Loans or L/C Disbursements in respect of which such Defaulting Lender has not fully funded its appropriate share; and (y) such Loans or L/C Disbursements were made at a time when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and L/C Disbursements owed to, all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Disbursements owed to, such Defaulting Lender. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post cash collateral pursuant to this Section 2.18(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(iii) Certain Fees. A Defaulting Lender: (x) shall not be entitled to receive any Unused Fee or Facility Fee pursuant to Section 2.11 for any period during which such Lender is a Defaulting Lender (and the applicable Borrower shall not be required to pay any such fee that otherwise would have been required to have been paid to such Defaulting Lender); and (y) shall be limited in its right to receive Letter of Credit fees as provided in Section 2.11.
(iv) Reallocation of Applicable Percentages to Reduce L/C Exposure. During any period in which there is a Defaulting Lender, for purposes of computing the amount of the obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit, the “Applicable Percentage” of each non-Defaulting Lender shall be computed without giving effect to the Commitment of such Defaulting Lender; provided, that: (A) each such reallocation shall be given effect only if, at the date the applicable Lender becomes a Defaulting Lender, no Default or Event of Default exists; and (B) the aggregate obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit shall not exceed the positive difference, if any, of: (1) the Commitment of such non-Defaulting Lender; minus (2) the aggregate outstanding principal amount of the Loans of such Lender.
(b) Defaulting Lender Cure. If the Borrower, Administrative Agent and the Issuing Bank agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any cash
collateral), such Defaulting Lender will, to the extent applicable, purchase that portion of outstanding Loans of the other Lenders or take such other actions as Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit to be held on a pro rata basis by the Lenders in accordance with their Applicable Percentages (without giving effect to Section 2.18(a)(iv)), whereupon such Defaulting Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while such Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no cessation in status as Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising during the period that such Lender was a Defaulting Lender.
SECTION 2.19 Mitigation Obligations; Replacement of Lenders.
(a) Each Lender and the Issuing Bank will notify the Borrower of any event occurring after the date of this Agreement which will entitle such Person to compensation pursuant to Sections 2.12 and 2.14 as promptly as practicable after it obtains knowledge thereof and determines to request such compensation, provided that such Person shall not be liable for the failure to provide such notice. If any Lender or the Issuing Bank requests compensation under Section 2.12, or if the Borrower is required to pay any additional amount to any such Person or any Governmental Authority for the account of any Lender pursuant to Section 2.14, then such Lender or the Issuing Bank shall use reasonable efforts to avoid or minimize the amounts payable, including, without limitation, the designation of a different lending office for funding or booking its Loans and Letters of Credit hereunder or the assignment of its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender or the Issuing Bank, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.12 or 2.14, as the case may be, in the future and (ii) would not subject such Lender or the Issuing Bank to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender or the Issuing Bank. The Borrower hereby agrees to pay all reasonable and documented costs and expenses incurred by any Lender or the Issuing Bank in connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.12, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.14, or if any Lender defaults in its obligation to fund Loans hereunder, or if a Lender does not vote in favor of any amendment, modification, or waiver to this Agreement or any other Loan Document which requires the vote of such Lender, and the Required Lenders shall have voted in favor of such amendment, modification, or waiver, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to, and upon such demand the affected Lender shall promptly, assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the
Borrower shall have received the prior written consent of the Administrative Agent (and, if a Commitment is being assigned, the Issuing Bank), which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts), and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments required to be made pursuant to Section 2.14, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
SECTION 2.20 Extension.
(a) Subject to the provisions of this Section, the Borrower may extend the Maturity Date of the Revolving Loans one time for a one (1) year period by giving written request therefor (the “Extension Request”) to the Administrative Agent (who shall promptly forward such request to each Lender) of the Borrower’s desire to extend such term, at least sixty (60), but no more than one hundred twenty (120), days prior to the Maturity Date.
(b) If the Maturity Date is extended, all of the other terms and conditions of this Agreement and the other Loan Documents (including interest payment dates) shall remain in full force and effect and unmodified, except as expressly provided for herein. The extension of the Maturity Date is subject to the satisfaction of each of the following additional conditions:
(i) The representations and warranties of each Credit Party set forth in this Agreement or any other Loan Document to which such Credit Party is a signatory shall be true and correct in all material respects on the date that the Extension Request is given to the Administrative Agent and on the first day of the extension (except to the extent such representations and warranties relate to a specified date);
(ii) no Default or Event of Default has occurred and is continuing on the date on which the Borrower gives the Administrative Agent the Extension Request or on the first day of the extension;
(iii) the Borrower shall be in compliance with all of the financial covenants set forth in Article V hereof both on the date on which the Extension Request is given to the Administrative Agent and on the first day of the extension;
(iv) the Borrower shall have paid to the Administrative Agent all amounts then due and payable to any of the Lenders, the Issuing Bank and the Administrative Agent under the Loan Documents, including the extension fee described in Section 2.11(g) hereof;
(v) the Borrower shall pay for any and all reasonable out-of-pocket costs and expenses, including, reasonable attorneys’ fees and disbursements, incurred by the Administrative Agent in connection with or arising out of the extension of the Maturity Date;
(vi) no change in the business, assets, management, operations or financial condition of any Credit Party shall have occurred since the most recent funding of any Loan, which change, in the judgment of the Administrative Agent, will have or is reasonably likely to have a Material Adverse Effect;
(vii) the Borrower shall execute and deliver to Administrative Agent such other documents, financial statements, instruments, certificates, opinions of counsel, reports, or amendments to the Loan Documents as the Administrative Agent shall reasonably request regarding the Credit Parties as shall be necessary to effect such extension; and
(viii) a written agreement evidencing the extension is signed by the Administrative Agent, the Lenders, the Credit Parties and any other Person to be charged with compliance therewith, which agreement such parties agree to execute if the extension conditions set forth above have been satisfied.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders, the Administrative Agent and the Issuing Bank that:
SECTION 3.01 Organization; Powers. Each Credit Party and each Property Subsidiary is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.
SECTION 3.02 Authorization; Enforceability. The Transactions are within the corporate, partnership or limited liability company powers (as applicable) of the respective Credit Parties and have been duly authorized by all necessary corporate, partnership or limited liability company action. This Agreement and the Loan Documents have been duly executed and delivered by each Credit Party which is a party thereto and constitute the legal, valid and binding obligation of each such Person, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors' rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03 Governmental Approvals; No Conflicts. The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any
Governmental Authority, except such as have been obtained or made and are in full force and effect, (b) will not violate any applicable law or regulation or the charter, by-laws or other organizational documents of any Credit Party or any of the Borrower’s Subsidiaries or any order of any Governmental Authority, (c) will not violate or result in a default under any indenture, agreement or other instrument binding upon any Credit Party or any of the Borrower’s Subsidiaries or its assets, or give rise to a right thereunder to require any payment to be made by any Credit Party or any of the Borrower’s Subsidiaries, and (d) will not result in the creation or imposition of any Lien on any asset of any Credit Party or any of the Borrower’s Subsidiaries.
SECTION 3.04 Financial Condition; No Material Adverse Change.
(k) The Parent has heretofore furnished to the Lenders financial statements as of and for the fiscal year ended December 31, 2013 and the fiscal quarter ended September 30, 2014 reported on by Deloitte & Touche, LLP, independent public accountants, for the Borrower and its Subsidiaries. Such financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of the Borrower and its consolidated Subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year-end audit adjustments and the absence of footnotes in the case of the quarter end statements referred to above.
(l) Since September 30, 2014, no event has occurred which could reasonably be expected to have a Material Adverse Effect.
SECTION 3.05 Properties.
(c) Subject to Liens permitted by Section 6.02, each of the Borrower and its Subsidiaries has title to, or valid leasehold interests in, all its real and personal property material to its business, except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes.
(d) Each of the Borrower and its Subsidiaries owns, or is licensed to use, all trademarks, tradenames, copyrights, patents and other intellectual property material to the Borrower’s business, and the use thereof by the Borrower and its Subsidiaries does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
(e) All components of all improvements included within the Real Property in the Unencumbered Pool, including, without limitation, the roofs and structural elements thereof and the heating, ventilation, air conditioning, plumbing, electrical, mechanical, sewer, waste water, storm water, paving and parking equipment, systems and facilities included therein, are in good working order and repair, subject to such exceptions which are not reasonably likely to have, in the aggregate, a Material Adverse Effect. All water, gas, electrical, steam, compressed air, telecommunication, sanitary and storm sewage lines and systems and other similar systems serving the Real Property owned or leased by any
Credit Party or any Property Subsidiary are installed and operating and are sufficient to enable the Real Property to continue to be used and operated in the manner currently being used and operated, and no Credit Party has any knowledge of any factor or condition that reasonably could be expected to result in the termination or material impairment of the furnishing thereof, subject to such exceptions which are not likely to have, in the aggregate, a Material Adverse Effect. No improvement or portion thereof is dependent for its access, operation or utility on any land, building or other improvement not included in the Real Property owned or leased by the Borrower or its Subsidiaries, other than for access provided pursuant to a recorded easement or other right of way establishing the right of such access subject to such exceptions which are not likely to have, in the aggregate, a Material Adverse Effect.
(f) All franchises, licenses, authorizations, rights of use, governmental approvals and permits (including all certificates of occupancy and building permits) required to have been issued by Governmental Authority to enable all Real Property owned or leased by Borrower or any of its Subsidiaries to be operated as then being operated have been lawfully issued and are in full force and effect, other than those which the failure to obtain in the aggregate could not be reasonably expected to have a Material Adverse Effect. No Credit Party or any Property Subsidiary is in violation of the terms or conditions of any such franchises, licenses, authorizations, rights of use, governmental approvals and permits, which violation would reasonably be expected to have a Material Adverse Effect.
(g) None of the Credit Parties or any Property Subsidiary has received any notice or has any knowledge, of any pending, threatened or contemplated condemnation proceeding affecting any Real Property owned or leased by Borrower or any of its Subsidiaries or any part thereof, or any proposed termination or impairment of any parking at any such owned or leased Real Property or of any sale or other disposition of any Real Property owned or leased by Borrower or any of its Subsidiaries or any part thereof in lieu of condemnation, which in the aggregate, are reasonably likely to have a Material Adverse Effect.
(h) Except for events or conditions not reasonably likely to have, in the aggregate, a Material Adverse Effect, (i) no portion of any Real Property owned or leased by Borrower or any of its Subsidiaries has suffered any material damage by fire or other casualty loss which has not heretofore been completely repaired and restored to its condition prior to such casualty, and (ii) no portion of any Real Property owned or leased by Borrower or any of its Subsidiaries is located in a special flood hazard area as designated by any federal Government Authorities or any area identified by the insurance industry or other experts acceptable to the Administrative Agent as an area that is a high probable earthquake or seismic area, except as set forth on Schedule 3.05(f).
(i) There are no Persons operating or managing any Real Property other than the Borrower and the Management Company pursuant to (i) the management agreements delivered to Administrative Agent as of the Effective Date, and (ii) such other management agreements in form and substance reasonably satisfactory to the Administrative Agent. To Borrower’s knowledge, no improvement or portion thereof, or any other part of any Real
Property, is dependent for its access, operation or utility on any land, building or other improvement not included in the Real Property owned or leased by the Borrower or its Subsidiaries, other than for access provided pursuant to a recorded easement or other right of way establishing the right of such access.
SECTION 3.06 Intellectual Property. To the knowledge of each Credit Party, such Credit Party and each Property Subsidiary owns, or is licensed to use, all trademarks, trade names, copyrights, patents and other intellectual property material to its business, and the use thereof by such Credit Party does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. To the knowledge of each Credit Party, there are no material slogans or other advertising devices, projects, processes, methods, substances, parts or components, or other material now employed, or now contemplated to be employed, by any Credit Party or any Property Subsidiary with respect to the operation of any Real Property, and no claim or litigation regarding any slogan or advertising device, project, process, method, substance, part or component or other material employed, or now contemplated to be employed by any Credit Party or any Property Subsidiary, is pending or threatened, the outcome of which could reasonably be expected to have a Material Adverse Effect.
SECTION 3.07 Litigation and Environmental Matters.
(e) Except as set forth in Schedule 3.07 attached hereto, there are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Borrower, threatened against or affecting any Credit Party or any of the Borrower’s Subsidiaries (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect or (ii) that involve this Agreement or the Transactions.
(f) Except with respect to any other matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect :
(i) to the knowledge of the Credit Parties, all Real Property leased or owned by Borrower or any of its Subsidiaries is free from contamination by any Hazardous Material, except to the extent such contamination could not reasonably be expected to cause a Material Adverse Effect;
(ii) to the knowledge of the Credit Parties, the operations of Borrower and its Subsidiaries, and the operations at the Real Property leased or owned by Borrower or any of its Subsidiaries are in compliance with all applicable Environmental Laws, except to the extent such noncompliance could not reasonably be expected to cause a Material Adverse Effect;
(iii) neither the Borrower nor any of its Subsidiaries have known liabilities with respect to Hazardous Materials and, to the knowledge of each Credit Party, no facts or circumstances exist which could reasonably be expected to give rise to
liabilities with respect to Hazardous Materials, in either case, except to the extent such liabilities could not reasonably be expected to have a Material Adverse Effect;
(iv) (A) the Borrower and its Subsidiaries and all Real Property owned or leased by Borrower or its Subsidiaries have all Environmental Permits necessary for the operations at such Real Property and are in compliance with such Environmental Permits; (B) there are no legal proceedings pending nor, to the knowledge of any Credit Party, threatened to revoke, or alleging the violation of, such Environmental Permits; and (C) none of the Credit Parties or any Property Subsidiary have received any notice from any source to the effect that there is lacking any Environmental Permit required in connection with the current use or operation of any such properties, in each case, except to the extent the nonobtainment or loss of an Environmental Permit could not reasonably be expected to have a Material Adverse Effect;
(v) neither the Real Property currently leased or owned by Borrower nor any of its Subsidiaries, nor, to the knowledge of any Credit Party, (x) any predecessor of any Credit Party or any Property Subsidiary, nor (y) any of Credit Parties’ or any Property Subsidiaries’ Real Property owned or leased in the past, nor (z) any owner of Real Property leased or operated by Borrower or any of its Subsidiaries, are subject to any outstanding written order or contract, including Environmental Liens, with any Governmental Authority or other Person, or to any federal, state, local, foreign or territorial investigation of which a Credit Party or any Property Subsidiary has been given notice respecting (A) Environmental Laws, (B) Remedial Action, (C) any Environmental Claim; or (D) the Release or threatened Release of any Hazardous Material, in each case, except to the extent such written order, contract or investigation could not reasonably be expected to have a Material Adverse Effect;
(vi) none of the Credit Parties or Property Subsidiaries are subject to any pending legal proceeding alleging the violation of any Environmental Law nor, to the knowledge of each Credit Party, are any such proceedings threatened, in either case, except to the extent any such proceedings could not reasonably be expected to have a Material Adverse Effect;
(vii) neither the Borrower nor any of its Subsidiaries nor, to the knowledge of each Credit Party, any predecessor of any Credit Party or any Property Subsidiary, nor to the knowledge of each Credit Party, any owner of Real Property leased by Borrower or any of its Subsidiaries, have filed any notice under federal, state or local, territorial or foreign law indicating past or present treatment, storage, or disposal of or reporting a Release of Hazardous Material into the environment, in each case, except to the extent such Release of Hazardous Material could not reasonably be expected to have a Material Adverse Effect;
(viii) none of the operations of the Borrower or any of its Subsidiaries or, to the knowledge of each Credit Party, of any owner of premises currently leased by Borrower or any of its Subsidiaries or of any tenant of premises currently leased
from Borrower or any of its Subsidiaries, involve or previously involved the generation, transportation, treatment, storage or disposal of hazardous waste, as defined under 40 C.F.R. Part 261.3 (in effect as of the date of this Agreement) or any state, local, territorial or foreign equivalent, in violation of Environmental Laws, except to the extent the same could not reasonably be expected to have a Material Adverse Effect; and
(ix) to the knowledge of the Credit Parties, there is not now, nor has there been in the past (except, in all cases, to the extent the existence thereof could not reasonably be expected to have a Material Adverse Effect), on, in or under any Real Property leased or owned by Borrower or any of its Subsidiaries, or any of their predecessors (A) any underground storage tanks or surface tanks, dikes or impoundments (other than for surface water); (B) any friable asbestos-containing materials; (C) any polychlorinated biphenyls; or (D) any radioactive substances other than naturally occurring radioactive material.
SECTION 3.08 Compliance with Laws and Agreements. Each of the Credit Parties and each Property Subsidiary is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. No Default with respect to such laws, regulations and orders of any Governmental Authority has occurred and is continuing. To the knowledge of the Credit Parties, the Credit Parties and their Subsidiaries and their respective officers and employees, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects. None of the Credit Parties, any Subsidiary or, to the knowledge of any Credit Party, any of their respective directors, officers or employees is a Sanctioned Person. No Loan, use of the proceeds of any Loan or other transactions contemplated hereby will violate Anti-Corruption Laws or applicable Sanctions. Neither the making of the Loans hereunder nor the use of the proceeds thereof will violate the Patriot Act, the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 C.F.R., Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto or successor statute thereto. The Credit Parties and their Subsidiaries are in compliance in all material respects with the Patriot Act.
SECTION 3.09 Investment and Holding Company Status. Neither any of the Credit Parties nor any of the Borrower’s Subsidiaries is (a) an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940 or (b) a “holding company” as defined in, or subject to regulation under, the Public Utility Holding Company Act of 1935.
SECTION 3.10 Taxes. Each Credit Party and each of the Borrower’s Subsidiaries has timely filed or caused to be filed all Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings and for which such Person has set aside on its books adequate reserves or (b) to the extent that the failure to do so could not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.11 ERISA. No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. The Borrower does not have any Plans as of the date hereof. As to any future Plan the present value of all accumulated benefit obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) will not exceed the fair market value of the assets of such Plan, and the present value of all accumulated benefit obligations of all underfunded Plans (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) will not exceed the fair market value of the assets of all such underfunded Plans.
SECTION 3.12 Disclosure. The Borrower has disclosed or made available to the Lenders all agreements, instruments and corporate or other restrictions to which it, any other Credit Party, or any of its Subsidiaries is subject, and all other matters known to it, that, in the aggregate, could reasonably be expected to result in a Material Adverse Effect. None of the reports, financial statements, certificates or other information furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.
SECTION 3.13 Insurance. Borrower has provided to Administrative Agent an insurance schedule which accurately sets forth, in all material respects, as of the Effective Date all insurance policies and programs currently in effect with respect to the assets and business of Borrower and its Subsidiaries, specifying for each such policy and program, (i) the amount thereof, (ii) the risks insured against thereby, (iii) the name of the insurer and each insured party thereunder, (iv) the policy or other identification number thereof and (v) the expiration date thereof. Such insurance policies and programs (or such other similar policies as are permitted pursuant to Section 5.06) are currently in full force and effect, and, together with payment by the insured of scheduled deductible payments, are in amounts sufficient to cover the replacement value of the respective assets of the Borrower and its Subsidiaries.
SECTION 3.14 Margin Regulations. The Borrower is not engaged in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of Regulation U issued by the Board), and no proceeds of any Loan or Letter of Credit will be used to purchase or carry any margin stock.
SECTION 3.15 Subsidiaries; REIT Qualification. As of the Effective Date, the Parent has only the Subsidiaries listed on Schedule 3.15 attached hereto. Education Realty OP GP, Inc. and Education Realty OP Limited Partnership Trust each qualify as a “qualified REIT subsidiary” under Section 856 of the Code.
ARTICLE IV
Conditions
SECTION 4.01 Effective Date. The obligations of the Lenders to make Loans and of the Issuing Bank to issue Letters of Credit hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.02):
(b) The Administrative Agent (or its counsel) shall have received from each Credit Party either (i) a counterpart of this Agreement and all other Loan Documents to which it is party signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed signature page of each such Loan Document other than the Notes) that such party has signed a counterpart of the Loan Documents, together with copies of all Loan Documents.
(c) The Administrative Agent shall have received a favorable written opinion (addressed to the Administrative Agent and the Lenders and dated the Effective Date) of Bass, Berry & Sims PLC, counsel for the Borrower and the Guarantor, and such other counsel as the Administrative Agent may approve, covering such matters relating to the Credit Parties, the Loan Documents or the Transactions as the Required Lenders shall reasonably request. The Borrower hereby requests such counsel to deliver such opinion.
(d) The Administrative Agent shall have received such documents and certificates as the Administrative Agent or its counsel may reasonably request relating to the organization, existence and good standing of the Credit Parties, the authorization of the Transactions and any other legal matters relating to the Credit Parties, this Agreement (including each Credit Party's compliance with Section 9.14 and other customary "know your customer" requirements) or the Transactions, all in form and substance satisfactory to the Administrative Agent and its counsel.
(e) The Administrative Agent shall have received a Compliance Certificate, dated the date of this Agreement and signed by a Financial Officer of EDR, in form and substance satisfactory to the Administrative Agent.
(f) The Administrative Agent shall have received all fees and other amounts due and payable on or prior to the Effective Date, including, to the extent invoiced, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower hereunder.
(g) The Administrative Agent shall have received copies of all other Loan Documents, and such other due diligence information as the Administrative Agent may require for each Acceptable Unencumbered Property included in the Unencumbered Pool as of the Effective Date.
(h) The Term Facility shall have previously or simultaneously closed.
The Administrative Agent shall notify the Borrower and the Lenders of the Effective Date, and such notice shall be conclusive and binding.
SECTION 4.02 Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing, and of the Issuing Bank to issue, amend, renew or extend any Letter of Credit, is subject to the satisfaction of the following conditions:
(c) The representations and warranties of each Credit Party set forth in this Agreement or in any other Loan Document shall be true and correct on and as of the date of such Borrowing or the date of issuance, amendment, renewal or extension of such Letter of Credit, as applicable.
(d) At the time of and immediately after giving effect to such Borrowing or the issuance, amendment, renewal or extension of such Letter of Credit, as applicable, no Default shall have occurred and be continuing.
(e) With respect to (i) any requested Borrowings, the Borrower shall have complied with Section 2.03 or Section 2.04, as applicable, and (ii) the request for the issuance, amendment, renewal or extension of any Letters of Credit, the Borrower shall have complied with Section 2.05(b).
(f) The Administrative Agent shall have received a Compliance Certificate signed by a Financial Officer of EDR for the most recent completed quarter, adjusted to reflect any new Indebtedness incurred, the sale of any Real Property or the addition or removal of any Real Property from the Unencumbered Pool since such quarter end.
Each Borrowing and each issuance, amendment, renewal or extension of a Letter of Credit shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in this Section.
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full and all Letters of Credit shall have expired or terminated and all LC Disbursements shall have been reimbursed, the Borrower covenants and agrees with the Lenders that:
SECTION 5.01 Financial Statements; Ratings Change and Other Information. The Borrower will furnish to the Administrative Agent and each Lender:
(g) within 90 days after the end of each fiscal year of the Parent, the Parent’s audited consolidated balance sheet and related statements of operations, stockholders' equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by Deloitte & Touche LLP or other independent public accountants of recognized national standing (without a “going
concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Parent and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;
(h) within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Parent, the Parent’s consolidated balance sheet and related statements of operations, stockholders' equity and cash flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly in all material respects the financial condition and results of operations of the Parent and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes, and (ii) a property report with a list of all Real Property acquired by the Borrower or any of its Subsidiaries since the last quarterly property report and summary operating information for each property, including the Net Operating Income of each property;
(i) concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of EDR (the “Compliance Certificate”) in the form of Exhibit B attached hereto;
(j) promptly after the same become publicly available for Forms 10-K and 10-Q described below, and upon written request for items other than Forms 10-K and 10-Q described below, copies of all periodic and other reports, proxy statements and other materials filed by the Parent, the Borrower or any Subsidiary with the Securities and Exchange Commission (including registration statements and reports on Form 10-K, 10-Q and 8-K (or their equivalents)), or any Governmental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange, or distributed by the Parent or the Borrower to its shareholders generally, as the case may be;
(k) within thirty (30) days after the beginning of each fiscal year, a current consolidated operating budget of the Parent which includes the Borrower and its Subsidiaries (based on the Parent’s good faith estimates and projections) for that fiscal year, including projected sources and uses of funds (including dividend and debt payments); and
(l) promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of any Credit Party, or compliance with the terms of the Loan Documents, as the Administrative Agent or any Lender may reasonably request.
SECTION 5.02 Financial Tests. The Borrower shall have and maintain, on a consolidated basis in accordance with GAAP, tested as of the close of each fiscal quarter:
(m) a Total Leverage Ratio no greater than sixty percent (60%) at all times;
(n) a Fixed Charge Coverage Ratio of not less than 1.50:1.00 at all times;
(o) a Tangible Net Worth of at least $896,000,000.00, plus seventy-five percent (75%) of the net proceeds (gross proceeds less reasonable and customary costs of sale and issuance paid to Persons not Affiliates of any Credit Party) received by the Borrower or the Parent at any time from the issuance of stock (whether common, preferred or otherwise) of the Parent or the Borrower after the date of this Agreement, at all times;
(p) a Total Secured Debt Ratio of no greater than forty percent (40%) at all times;
(q) a Total Unsecured Debt to Unencumbered Asset Value Ratio of no greater than sixty percent (60%) at all times; and
(r) an Unsecured Interest Coverage Ratio of not less than 1.75:1.00 at all times.
SECTION 5.03 Notices of Material Events. The Borrower will furnish to the Administrative Agent and each Lender written notice of the following promptly after it becomes aware of same (unless specific time is set forth below):
(j) the occurrence of any Default;
(k) within five (5) Business Days after the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting any Credit Party or any Affiliate thereof that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect;
(l) within five (5) Business Days after the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding $10,000,000.00; and
(m) any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer or other executive officer of EDR setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
SECTION 5.04 Existence; Conduct of Business. The Borrower will, and will cause each of its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges and franchises material to the conduct of its business; provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.03. Each Property Subsidiary must at all times be a Subsidiary of Borrower.
SECTION 5.05 Payment of Obligations. The Borrower will, and will cause each of its Subsidiaries to, pay its obligations, including Tax liabilities, that, if not paid, could result in a
Material Adverse Effect before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.06 Maintenance of Properties; Insurance.
(e) The Borrower will, and will cause each of its Subsidiaries to, maintain insurance with financially sound and reputable insurance companies against such risks and in such amounts as is customarily maintained by similar businesses or as may be required by Legal Requirements. The Borrower shall from time to time deliver to the Administrative Agent upon request a detailed list, together with copies of all policies of the insurance then in effect, stating the names of the insurance companies, the amounts and rates of the insurance, the dates of the expiration thereof and the properties and risks covered thereby.
(f) The Borrower will pay and discharge all taxes, assessments, maintenance charges, permit fees, impact fees, development fees, capital repair charges, utility reservations and standby fees and all other similar impositions of every kind and character charged, levied, assessed or imposed against any interest in any of the Real Property in the Unencumbered Pool, as they become payable and before they become delinquent. The Borrower shall furnish receipts evidencing proof of such payment to the Administrative Agent promptly after payment and before delinquency.
SECTION 5.07 Books and Records; Inspection Rights.
(f) The Borrower will, and will cause each of its Subsidiaries to, keep proper books of record and account in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities.
(g) The Borrower will, and will cause each of its Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender, upon reasonable prior notice and subject to rights of tenants, to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested.
SECTION 5.08 Compliance with Laws. The Borrower will, and will cause each of its Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.09 Use of Proceeds and Letters of Credit. The proceeds of the Loans will be used for acquisition, development and enhancement of Real Property, debt refinancing, capital improvements and working capital. No part of the proceeds of any Loan will be used, whether directly or indirectly, for financing, funding or completing the hostile acquisition of publicly
traded Persons or for any purpose that entails a violation of any of the Regulations of the Board, including Regulations U and X.
SECTION 5.10 Fiscal Year. Borrower shall maintain as its fiscal year the twelve (12)-month period ending on December 31 of each year.
SECTION 5.11 Environmental Matters.
(e) Borrower shall comply and shall cause each of its Subsidiaries and each Real Property owned or leased by such parties to comply in all material respects with all applicable Environmental Laws currently or hereafter in effect, except to the extent noncompliance could not reasonably be expected to have a Material Adverse Effect.
(f) If the Administrative Agent or the Required Lenders at any time have a reasonable basis to believe that there may be a material violation of any Environmental Law related to any Real Property owned or leased by Borrower or any of its Subsidiaries, or Real Property adjacent to such Real Property, which could reasonably be expected to have a Material Adverse Effect, then Borrower agrees, upon request from the Administrative Agent (which request may be delivered at the option of Administrative Agent or at the direction of Required Lenders), to provide the Administrative Agent, at the Borrower’s expense, with such reports, certificates, engineering studies or other written material or data as the Administrative Agent or the Required Lenders may reasonably require so as to reasonably satisfy the Administrative Agent and the Required Lenders that any Credit Party, or Property Subsidiary or Real Property owned or leased by them is in material compliance with all applicable Environmental Laws.
(g) Borrower shall, and shall cause each of its Subsidiaries to, take such Remedial Action or other action as required by Environmental Law or any Governmental Authority.
(h) If the Borrower fails to timely take, or to diligently and expeditiously proceed to complete in a timely fashion, any action described in this Section, the Administrative Agent may, after notice to the Borrower, with the consent of the Required Lenders, make advances or payments toward the performance or satisfaction of the same, but shall in no event be under any obligation to do so. All sums so advanced or paid by the Administrative Agent (including reasonable counsel and consultant and investigation and laboratory fees and expenses, and fines or other penalty payments) and all sums advanced or paid in connection with any judicial or administrative investigation or proceeding relating thereto, will become due and payable from the Borrower ten (10) Business Days after demand, and shall bear interest at the rate for past due interest provided in Section 2.12(c) from the date any such sums are so advanced or paid by the Administrative Agent until the date any such sums are repaid by the Borrower. Promptly upon request, the Borrower will execute and deliver such instruments as the Administrative Agent may deem reasonably necessary to permit the Administrative Agent to take any such action, and as the Administrative Agent may require to secure all sums so advanced or paid by the Administrative Agent.
SECTION 5.12 Unencumbered Pool. As of the Effective Date, the Unencumbered Pool consists solely of those Acceptable Unencumbered Properties listed on Schedule 5.12, with those Acceptable Unencumbered Properties which are either an Eligible Off Campus Ground Lease or an Eligible Property Lease being so designated thereon (the “Unencumbered Pool”).
SECTION 5.13 Additions to Unencumbered Pool. Provided that no Default then exists, the Borrower may add Real Property to the Unencumbered Pool, subject to the following:
(g) The Borrower has provided the Administrative Agent with a written notice that such Real Property is added in the Unencumbered Pool, together with a certification that the Real Property to be added to the Unencumbered Pool satisfies each of the requirements set forth in the definition of “Acceptable Unencumbered Property”.
(h) If the Borrower requests inclusion of assets in the Unencumbered Pool that do not meet the requirements of this Section, then such assets may only be included in the Unencumbered Pool upon the prior written approval of the Administrative Agent and the Majority Lenders.
SECTION 5.14 Removal of Real Property from Unencumbered Pool. Provided that no Default then exists, the Borrower may remove Real Property from the Unencumbered Pool, provided that the Borrower will be in compliance with the terms of this Agreement, including, without limitation Section 5.02 hereof, after giving effect to the removal of any Real Property from the Unencumbered Pool.
SECTION 5.15 Further Assurances. At any time upon the request of the Administrative Agent, Borrower will, promptly and at its expense, execute, acknowledge and deliver such further documents and perform such other acts and things as the Administrative Agent may reasonably request to evidence the Loans made hereunder and interest thereon in accordance with the terms of this Agreement.
SECTION 5.16 [Reserved]
SECTION 5.17 Parent Covenants. The Parent will:
(c) maintain at least one class of common shares of the Parent having trading privileges on the New York Stock Exchange;
(d) own, directly or indirectly, all of the general partner interests in EDR and at least fifty-one percent (51%) of (i) the shares of beneficial interest of EDR, and (ii) each class of security issued by EDR with the power to select the general partner of EDR;
(e) maintain management and control of EDR;
(f) conduct substantially all of its operations through EDR and one or more of EDR’s Subsidiaries;
(g) comply with all Legal Requirements to maintain, and will at all times elect, qualify as and maintain, its status as a real estate investment trust under Section 856(c)(i) of the Code; and
(h) promptly contribute to EDR the net proceeds of any stock sales or debt offerings.
SECTION 5.18 OFAC
(a) Each Credit Party will comply in all material respects with all Anti-Corruption Laws and applicable Sanctions.
(b) The Borrower shall not request any Loan, or use the proceeds of any Loan, (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws (ii) in any Sanctioned Country, (iii) for the purpose of knowingly funding or financing any Sanctioned Person, or (iv) in any transaction that would result in the violation of any Sanctions by the Borrower or any Subsidiary.
ARTICLE VI
Negative Covenants
Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees payable hereunder have been paid in full and all Letters of Credit have expired or terminated and all LC Disbursements shall have been reimbursed, the Borrower covenants and agrees with the Lenders that:
SECTION 6.01 Sale/Leaseback. The Borrower will not, and will not permit any Subsidiary to, enter into a sale/leaseback, or similar transaction, for any of its Real Property other than PILOT or similar transactions.
SECTION 6.02 Liens. The Borrower will not create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it which is included in the Unencumbered Pool or by a Property Subsidiary, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof, except:
(n) Permitted Encumbrances; and
(o) any Lien on any property or asset of the Borrower or a Property Subsidiary existing on the date hereof and set forth in Schedule 6.02 and any non-recourse Indebtedness of Borrower or Guarantor secured by a Lien on an asset which is not in the Unencumbered Pool; provided that (i) such Lien shall not apply to any other property or asset of the Borrower or any Subsidiary and (ii) such Lien shall secure only those obligations (whether present or future) set forth in the governing loan documents, as of the date hereof and extensions, renewals and replacements thereof that do not increase the outstanding principal amount thereof.
SECTION 6.03 Fundamental Changes. The Borrower will not, and will not permit any Subsidiary to:
(f) merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one transaction or in a series of transactions) all or substantially all of the assets of the Borrower or all or substantially all of the stock of its Subsidiaries (in each case, whether now owned or hereafter acquired), or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing (i) any Person may merge into, or consolidate with, Parent or Borrower in a transaction in which Parent or Borrower is the surviving entity, (ii) any Person not a Credit Party or a Property Subsidiary may merge into, or consolidate with any Subsidiary in a transaction in which the surviving entity is a Subsidiary, (iii) any Subsidiary not a Credit Party or a Property Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the Parent, Borrower or to another Subsidiary, (iv) any Subsidiary not a Credit Party or a Property Subsidiary may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution is in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary which is a Credit Party or a Property Subsidiary may merge into (or consolidate with) or liquidate or dissolve into, Parent, Borrower or any other Subsidiary which is a Credit Party or a Property Subsidiary, and (vi) any Subsidiary which is a Credit Party or a Property Subsidiary may sell, transfer, lease or otherwise dispose of its assets to Borrower or to any other Credit Party or a Property Subsidiary; provided that any such merger involving a Person that is not a wholly owned (directly or indirectly) Subsidiary immediately prior to such merger shall not be permitted unless also permitted by Section 6.04.
(g) sell, transfer, lease or otherwise dispose of any of its assets to a Person other than pursuant to clause (a) above if (i) the Value of the assets disposed of in any twelve (12) month period exceeds twenty-five percent (25%) of the Value of the Borrower’s and its Subsidiaries’ Real Property other than Assets Under Development or undeveloped land, before giving effect to such dispositions, or (ii) the assets disposed of in any twelve (12) month period contributed or made up more than twenty-five percent (25%) of the Borrower’s Net Operating Income for such twelve (12) month period.
(h) engage to any material extent in any business other than the ownership, development, operation and management of collegiate housing communities and businesses reasonably related thereto, except as allowed by Section 6.04(e).
SECTION 6.04 Investments, Loans, Advances and Acquisitions. The Borrower will not, and will not permit any of its Subsidiaries to, purchase, hold or acquire (including pursuant to any merger with any Person that was not a wholly owned Subsidiary prior to such merger) any capital stock, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, or make or permit to exist any investment or any other interest in, any other Person, or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit, except:
(g) Permitted Investments;
(h) Real Property operated as collegiate housing communities;
(i) investments in Unconsolidated Affiliates;
(j) undeveloped land;
(k) investments not related to the ownership, development, operation and management of collegiate housing communities;
(l) investments in notes secured by Real Property not to exceed fifteen percent (15%) of Total Asset Value;
(m) Assets Under Development; and
(n) mergers, consolidations and other transactions permitted under Section 6.03, so long as same do not cause the Borrower to be in violation of any provision of this Section 6.04.
In addition to the foregoing, the aggregate value of the investments described in clauses (c), (d), (e), (f) and (g), above shall not exceed thirty percent (30%) of Total Asset Value after giving effect to such investments. The failure to comply with the provisions of this paragraph shall not constitute a Default or an Event of Default, but shall instead result in a reduction of Total Asset Value by the incremental amounts in excess of such maximum amounts. The investments described above may be purchased or acquired, directly or indirectly, through partnerships, joint ventures, or otherwise. The calculations in this Section will be made without duplication if an investment is within more than one category described in this Section.
SECTION 6.05 Hedging Agreements. The Borrower will not, and will not permit any of its Subsidiaries to, enter into any Hedging Agreement, other than Hedging Agreements entered into in the ordinary course of business to hedge or mitigate risks to which the Borrower or any Subsidiary is exposed in the conduct of its business or the management of its liabilities.
SECTION 6.06 Restricted Payments. The Parent will not, and will not permit any of its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, during any calendar quarter, any Restricted Payment, except that any of the following Restricted Payments are permitted: (a) Restricted Payments by the Parent required to comply with Section 5.17(e); or (b) dividends or distributions declared and paid ratably by Subsidiaries to Borrower with respect to their capital stock or equity interest.
Notwithstanding the foregoing, provided no Event of Default is in existence, the amount of Restricted Payments may be increased as long as the increased Restricted Payment, when added to
all Restricted Payments made during the 3 immediately preceding calendar quarters, does not exceed 95% of Funds From Operations for the applicable period.
SECTION 6.07 Transactions with Affiliates. The Borrower will not, and will not permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except (a) in the ordinary course of business at prices and on terms and conditions not less favorable to the Borrower or such Subsidiary than could be obtained on an arm's-length basis from unrelated third parties, (b) transactions between or among the Borrower and its wholly owned Subsidiaries not involving any other Affiliate and (c) any Restricted Payment permitted by Section 6.06, and (d) as permitted by Section 6.03.
SECTION 6.08 Parent Negative Covenants. The Parent will not (a) own any Property other than the ownership interests of EDR and other assets with no more than $10,000,000.00 in value; (b) give or allow any Lien on the ownership interests of EDR; (c) create, incur, suffer or permit to exist, or assume or guarantee, directly or indirectly, contingently or otherwise, or become or remain liable with respect to any Indebtedness if the aggregate of such Indebtedness and the Indebtedness of the Borrower would violate Section 5.02 if such aggregate Indebtedness is treated as the Borrower's Indebtedness or (d) engage to any material extent in any business other than the ownership, development, operation and management of collegiate housing communities. For the avoidance of doubt, the Guaranty provided by Guarantor hereunder shall not be deemed or construed to violate the provisions of this Section 6.08.
SECTION 6.09 Restrictive Agreements. The Borrower will not, and will not permit any of its Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets, or (b) the ability of any Subsidiary to pay dividends or other distributions with respect to any shares of its capital stock or to make or repay loans or advances to the Borrower or any other Subsidiary or to Guarantee Indebtedness of the Borrower or any other Subsidiary; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by law or by this Agreement, (ii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iii) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness or Liens permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness and (iv) clause (a) of the foregoing shall not apply to customary provisions in leases restricting the assignment thereof. Notwithstanding anything herein to the contrary, the provisions of this Agreement (including, without limitation under this Section 6.09) shall not prohibit the use by Borrower, Guarantor, or any Subsidiary (including Property Subsidiary) of Acceptable Unencumbered Properties as a borrowing base for other Unsecured Debt.
SECTION 6.10 Indebtedness. Neither the Parent, the Borrower, nor any Property Subsidiary (at such time as it owns an Acceptable Unencumbered Property in the Unencumbered
Pool) shall, without the prior written consent of the Required Lenders, create, incur, assume, guarantee or be or remain liable, contingently or otherwise with respect to any Indebtedness on a recourse basis, except: (a) Indebtedness of the Parent or the Borrower under this Agreement, any Bond Facility or the Term Facility; (b) Indebtedness of the Parent, the Borrower or a Subsidiary (other than a Property Subsidiary at such time as it owns an Acceptable Unencumbered Property in the Unencumbered Pool) which does not violate the provisions of Section 5.02; (c) with respect to the Parent, the Borrower or a Subsidiary (other than a Property Subsidiary at such time as it owns an Acceptable Unencumbered Property in the Unencumbered Pool), other Indebtedness solely to the extent that the creation, incurrence or assumption thereof would not result in a Default under the terms of this Agreement; and (d) with respect to the Borrower, the Parent or a Subsidiary (other than a Property Subsidiary at such time as it owns an Acceptable Unencumbered Property in the Unencumbered Pool), Indebtedness whose recourse is solely for so-called “bad-boy” acts, including without limitation, (i) failure to account for a tenant’s security deposits, if any, for rent or any other payment collected by a borrower from a tenant under the lease, all in accordance with the provisions of any applicable loan documents, (ii) fraud or a material misrepresentation made by Borrower or any Guarantor, or the holders of beneficial or ownership interests in such Borrower or any Guarantor, in connection with the financing evidenced by the applicable loan documents; (iii) any attempt by Borrower or any Guarantor to divert or otherwise cause to be diverted any amounts payable to the applicable lender in accordance with the applicable loan documents; (iv) the misappropriation or misapplication of any insurance proceeds or condemnation awards relating to any Real Property; (v) voluntary or involuntary bankruptcy by Borrower or any Guarantor; and (vi) any environmental matter(s) affecting any Real Property which is introduced or caused by Borrower or any Guarantor or any holder of a beneficial or ownership interest in Borrower or any Guarantor.
ARTICLE VII
Events of Default
If any of the following events (“Events of Default”) shall occur:
(p) the Borrower shall fail to pay any principal of any Loan or any reimbursement obligation in respect of any LC Disbursement when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;
(q) any Credit Party shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under any Loan Documents, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of over three Business Days (such three Business Day period commencing after written notice from the Administrative Agent as to any such fee);
(r) any representation or warranty made or deemed made by or on behalf of any Credit Party in or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement or any amendment
or modification hereof or waiver hereunder, shall prove to have been incorrect in any material respect when made or deemed made;
(s) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Article V or VI other than Sections 5.04, 5.05, 5.06, 5.07(a), 5.08, and 5.11;
(t) any Credit Party shall fail to observe or perform any covenant, condition or agreement contained in any Loan Document to which it is a party (other than those specified in clause (a), (b) or (d) of this Article), and such failure shall continue unremedied for a period of over 30 days after notice thereof from the Administrative Agent to the Borrower (which notice will be given at the request of any Lender) and if such default is not cureable within thirty (30) days and the Credit Party is diligently pursuing cure of same, the cure period may be extended for 30 days (for a total of 60 days after the original notice from the Administrative Agent) upon written request from the Borrower to the Administrative Agent; provided further that notwithstanding the foregoing, the Borrower shall only have a five (5) Business Day grace period (with no notice from the Administrative Agent required) with respect any failure to comply with Section 5.01;
(u) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity;
(v) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of any Credit Party or any Subsidiary of the Borrower or its debts, or of a substantial part of its assets, under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Credit Party or any Subsidiary of the Borrower or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;
(w) any Credit Party or any Subsidiary of the Borrower shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for such Person or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;
(x) any Credit Party or any Subsidiary of the Borrower shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;
(y) one or more judgments for the payment of money in an aggregate amount in excess of $20,000,000 shall be rendered against any Credit Party, any Subsidiary of the Borrower or any combination thereof and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of such Person to enforce any such judgment;
(z) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when taken together with all other ERISA Events that have occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding $20,000,000;
(aa) the Guaranty of the Loan by the Guarantor shall for any reason terminate or cease to be in full force and effect;
(bb) any Credit Party or any Property Subsidiary shall default under any Material Contract;
(cc) any Credit Party shall (or shall attempt to) disavow, revoke or terminate any Loan Document to which it is a party or shall otherwise challenge or contest in any action, suit or proceeding in any court or before any Governmental Authority the validity or enforceability of any Loan Document; or
(dd) a Change in Control shall occur;
then, and in every such event (other than an event described in clause (g) or (h) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take some or all of the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower, and (iii) exercise any other rights or remedies provided under this Agreement (including Section 2.05(j)) or any other Loan Document, or any other right or remedy available by law or equity; and in case of any event described in clause (g) or (h) of this Article, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
Each of the Lenders and the Issuing Bank hereby irrevocably appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof, together with such actions and powers as are reasonably incidental thereto.
The bank serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations except those expressly set forth herein. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby that the Administrative Agent is required to exercise in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02), and (c) except as expressly set forth herein, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any Credit Party that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02) or in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement, (ii) the contents of any certificate, report or other document delivered hereunder or in connection herewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent. The Administrative Agent agrees that, in fulfilling its duties hereunder, it will use the same standard of care it utilizes in servicing loans for its own account.
The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any liability for relying thereon. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in good faith in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, the Administrative Agent may resign at any time by notifying the Lenders, the Issuing Bank and the Borrower, and may be removed by the Required Lenders in the event of the Administrative Agent’s gross negligence or willful misconduct. Upon any such resignation or removal, the Required Lenders shall have the right, with the approval of Borrower (provided no Default has occurred and is continuing), which approval shall not be unreasonably withheld, to appoint a successor. If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation or is removed, then the retiring Administrative Agent may, on behalf of the Lenders and the Issuing Bank, appoint a successor Administrative Agent which shall be (i) a Lender, or, if no Lender is willing to serve as the successor Administrative Agent, (ii) a bank with an office in New York, New York, or an Affiliate of any such bank whose senior debt obligations are rated not less than “A” or its equivalent by Moody’s or not less than “A” or its equivalent by S&P and which has a net worth of not less than $500,000,000. Upon the acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall 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. The fees payable by the Borrower to a successor Administrative Agent for its own behalf shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the Administrative Agent's resignation hereunder, the provisions of this Article and Section 9.03 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while it was acting as Administrative Agent. The Administrative Agent shall cooperate with any successor Administrative Agent in fulfilling its duties hereunder.
Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it shall from time to
time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any related agreement or any document furnished hereunder or thereunder.
ARTICLE IX
Miscellaneous
SECTION 9.01 Notices. Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:
(o) if to the Borrower, to it in care of EDR at 999 South Shady Grove Road, Suite 600, Memphis, TN 38120, Attention: Chief Financial Officer (Telephone No. (901) 259-2500 and Telecopy No. (901) 259-2594));
(p) if to the Administrative Agent, to KeyBank, National Association, 225 Franklin Street, Boston, Massachusetts, Attention: Gregory W. Lane (Telephone No. (617) 385-6212 and Telecopy No. (617) 385-6293);
(q) if to the Issuing Bank, to it at KeyBank, National Association, 225 Franklin Street, Boston, Massachusetts, Attention: Gregory W. Lane (Telephone No. (617) 385-6212and Telecopy No. (617) 385-6293; and
(r) if to the Swingline Lender, to it at KeyBank, National Association, 225 Franklin Street, Boston, Massachusetts, Attention: Gregory W. Lane (Telephone No. (617) 385-6212 and Telecopy No. (617) 385-6293); and
(s) if to any other Lender, to it at its address (or telecopy number) set forth on the signature pages of this Agreement, or as provided to Borrower in writing by the Administrative Agent or the Lender.
Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given (i) if given by telecopy, when such telecopy is transmitted to the telecopy number specified in this Section and the appropriate confirmation is received (or if such day is not a Business Day, on the next Business Day); (ii) if given by mail (return receipt requested), on the earlier of receipt or three (3) Business Days after such communication is deposited in the mail with first class postage prepaid, addressed as aforesaid; or (iii) if given by any other means, when delivered at the address specified in this Section; provided that notices to the Administrative Agent under Article II shall not be effective until received.
SECTION 9.02 Waivers; Amendments.
(g) No failure or delay by the Administrative Agent, the Issuing Bank or any Lender in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent, the Issuing Bank and the Lenders hereunder and under any other Loan Document are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by the Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent, any Lender or the Issuing Bank may have had notice or knowledge of such Default at the time.
(h) Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or LC Disbursement or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected thereby, (iii) postpone the scheduled date of payment of the principal amount of any Loan or LC Disbursement, or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender affected thereby, (iv) change Section 2.17(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender, (v) change any of the provisions of this Section or the definition of “Required Lenders”, “Majority Lenders”, or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender, (vi) release any Credit Party from its obligations under the Loan Documents without the written consent of each Lender, (vii) subordinate the Loans without the written consent of each Lender, or (viii) waive or modify any conditions of extending the Loans set forth in Section 2.20 without the written consent of each Lender affected thereby; provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent, the Issuing Bank or the Swingline Lender hereunder without the prior written consent of the Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may be.
(i) Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other
than Defaulting Lenders), except that (x) the Commitment of any Defaulting Lender may not be increased or extended without the consent of such Lender; and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lenders shall require the consent of such Defaulting Lender.
(j) Notwithstanding the fact that the consent of all the Lenders is required in certain circumstances as set forth above: (1) each Lender is entitled to vote as such Lender sees fit on any reorganization plan that affects the Loans or the Letters of Credit, and each Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy Code supersede the unanimous consent provisions set forth herein; and (2) the Required Lenders may consent to allow Borrower to use cash collateral in the context of a bankruptcy or insolvency proceeding. Administrative Agent may, after consultation with the Borrower, agree to the modification of any term of this Credit Agreement or any other Loan Document to correct any printing, stenographic or clerical errors or omissions that are inconsistent with the terms hereof.
(k) If Administrative Agent shall request the consent of any Lender to any amendment, change, waiver, discharge, termination, consent or exercise of rights covered by this Credit Agreement, and not receive such consent or denial thereof in writing within ten (10) Business Days of the making of such request by Administrative Agent, as the case may be, such Lender shall be deemed to have given its consent to the request.
SECTION 9.03 Expenses; Indemnity; Damage Waiver.
(h) The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent, in connection with the syndication of the credit facilities provided for herein, the preparation and administration of this Agreement or any amendments, modifications or waivers of the provisions hereof (whether or not the transactions contemplated hereby or thereby shall be consummated), (ii) all reasonable out-of-pocket expenses incurred by the Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder and (iii) all out-of-pocket expenses incurred by the Administrative Agent, the Issuing Bank or any Lender, including the reasonable fees, charges and disbursements of any counsel for the Administrative Agent, the Issuing Bank or any Lender, in connection with the enforcement or protection of its rights in connection with this Agreement, including its rights under this Section, or in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any waivers, workout, restructuring or negotiations in respect of such Loans or Letters of Credit.
(i) The Borrower shall indemnify the Administrative Agent, the Issuing Bank and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including the fees, charges and
disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement or any agreement or instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom (including any refusal by the Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses resulted from the gross negligence or willful misconduct of such Indemnitee as determined by a court of law in a final non-appealable judgment.
(j) To the extent that the Borrower fails to pay any amount required to be paid by it to the Administrative Agent, the Issuing Bank or the Swingline Lender under paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may be, such Lender's Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent, the Issuing Bank or the Swingline Lender in its capacity as such.
(k) To the extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the Transactions, any Loan or Letter of Credit or the use of the proceeds thereof.
(l) All amounts due under this Section shall be payable not later than ten days after written demand therefor.
SECTION 9.04 Successors and Assigns.
(h) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby (including any Affiliate of the Issuing Bank that issues any Letter of Credit), except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of the Issuing Bank that issues any Letter of Credit) and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(i) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld) of:
(A) the Borrower, provided that no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if a Default has occurred and is continuing, any other assignee;
(B) the Administrative Agent; and
(C) the Issuing Bank.
Provided, no consent of the Borrower, Administrative Agent or the Issuing Bank shall be required in connection with any assignment to an entity acquiring, or merging with, a Lender.
(ii) Assignments shall be subject to the following additional conditions:
(A) except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans of any Class, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000.00 unless each of the Borrower and the Administrative Agent otherwise consent, provided that no such consent of the Borrower shall be required if a Default has occurred and is continuing and such consent shall not be unreasonably withheld;
(B) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender's rights and obligations under this Agreement, provided that this clause shall not be construed to prohibit the assignment of a proportionate part of all the assigning Lender’s rights and obligations in respect of one Class of Commitments or Loans;
(C) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500.00; and
(D) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.
For the purposes of this Section 9.04(b), the term “Approved Fund” has the following meaning:
“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section, from and after the effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.14, 2.15, 2.16 and 9.03). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c) of this Section.
(iv) The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount of the Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent, the Issuing Bank and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower, the Issuing Bank and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee's completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.
(j) Any Lender may, without the consent of the Borrower, the Administrative Agent, the Issuing Bank or the Swingline Lender, sell participations to one or more banks or other entities (a “Participant”) in all or a portion of such Lender's rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (i) such Lender's obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent, the Issuing Bank and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects such Participant. Subject to paragraph (d) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.14, 2.15 and 2.16 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.17(c) as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that, except in the case of a Participant asserting any right of set-off pursuant to Section 9.08, no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person (other than Borrower) except to the extent that such disclosure is necessary to establish that such commitment, loan, or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations or except, upon request of Borrower, the Lender shall provide to Borrower the identity of such participant and the amount of its participation. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.
(k) A Participant shall not be entitled to receive any greater payment under Section 2.14 or 2.16 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower's prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.16 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.16(e) as though it were a Lender.
(l) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
SECTION 9.05 Survival. All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent, the Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not expired or terminated. The provisions of Sections 2.14, 2.15, 2.16 and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Letters of Credit and the Commitments or the termination of this Agreement or any provision hereof.
SECTION 9.06 Counterparts; Integration; Effectiveness; Joint and Several.
(c) This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.
(d) This Agreement and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.
(e) Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.
(f) The obligations of Borrower hereunder shall not be affected by (a) the failure of the Administrative Agent, any Issuing Bank or any Lender to assert any claim or demand or to enforce any right or remedy against Borrower under the provisions of this Agreement, any other Loan Document or otherwise; (b) any extension or renewal of any of the
Obligations; (c) any rescission, waiver, amendment or modification of, or release from, any of the terms or provisions of this Agreement, or any other Loan Document or agreement; (d) any default, failure or delay, willful or otherwise, in the performance of any of the Obligations; (e) the failure of the Administrative Agent to take any steps to perfect and maintain any security interest in, or to preserve any rights to, any security or collateral for the Obligations, if any; (f) any change in the corporate, partnership or other existence, structure or ownership of the Borrower or any other guarantor of any of the Obligations; (g) the enforceability or validity of the Obligations or any part thereof or the genuineness, enforceability or validity of any agreement relating thereto or with respect to any collateral securing the Obligations or any part thereof, or any other invalidity or unenforceability relating to or against the Borrower or any other guarantor of any of the Obligations, for any reason related to this Agreement, any other Loan Document, or any provision of applicable law, decree, order or regulation of any jurisdiction purporting to prohibit the payment by the Borrower or any other guarantor of the Obligations, of any of the Obligations or otherwise affecting any term of any of the Obligations; or (h) any other act omission or delay to do any other act which may or might in any manner or to any extent vary the risk of the Borrower or otherwise operate as a discharge of a guarantor as a matter of law or equity or which would impair or eliminate any right of the Borrower to subrogation.
(g) The obligations of Borrower hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, and shall not be subject to any defense or set-off, counterclaim, recoupment or termination whatsoever, by reason of the invalidity, illegality or unenforceability of any of the Obligations, any impossibility in the performance of any of the Obligations or otherwise.
(h) The Borrower further agrees that its obligations hereunder shall continue to be effective or be reinstated, as the case may be, if at any time payment or any part thereof of any Obligation (including a payment effected through exercise of a right of setoff) is rescinded, or is or must otherwise be restored or returned by the Administrative Agent any Issuing Bank or any Lender upon the insolvency, bankruptcy or reorganization of Borrower or otherwise (including pursuant to any settlement entered by a holder of Obligations in its discretion.
SECTION 9.07 Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
SECTION 9.08 Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter existing under this Agreement held by such
Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured. Each Lender agrees promptly to notify the Borrower after any such setoff and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such setoff and application. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.
SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process.
(i) This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.
(j) The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the state and federal courts in Boston, Massachusetts and in New York, New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees 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. Nothing in this Agreement shall affect any right that the Administrative Agent, the Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower or its properties in the courts of any jurisdiction.
(k) The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(l) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 9.10 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER
PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
SECTION 9.12 Confidentiality. Each of the Administrative Agent, the Issuing Bank and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates' directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority, (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, (g) with the consent of the Borrower or (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section or (ii) becomes available to the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis from a source other than the Borrower. For the purposes of this Section, “Information” means all information received from any Credit Party relating to the Credit Party or its business, other than any such information that is available to the Administrative Agent, the Issuing Bank or any Lender on a nonconfidential basis prior to disclosure by any Credit Party; provided that, in the case of information received from any Credit Party after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
SECTION 9.13 Interest Rate Limitation. If at any time there exists a maximum rate of interest which may be contracted for, charged, taken, received or reserved by the Lenders in accordance with applicable law (the “Maximum Rate”), then notwithstanding anything herein to the contrary, at any time the interest applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively, the “Charges”), shall exceed such Maximum Rate, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been paid in respect of such Loan but were not payable as result of the operation of this Section shall be cumulated and the interest and Charges payable to the Lenders in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by
the Lenders. If, for any reason whatsoever, the Charges paid or received on the Loans produces a rate which exceeds the Maximum Rate, the Lenders shall credit against the principal of the Loans (or, if such indebtedness shall have been paid in full, shall refund to the payor of such Charges) such portion of said Charges as shall be necessary to cause the interest paid on the Loans to produce a rate equal to the Maximum Rate. All sums paid or agreed to be paid to the holders of the Loans for the use, forbearance or detention of the Loans shall, to the extent permitted by applicable law, be amortized, prorated, allocated and spread in equal parts throughout the full term of this Agreement, so that the interest rate is uniform throughout the full term of this Agreement. The provisions of this Section shall control all agreements, whether now or hereafter existing and whether written or oral, between the parties hereto. Without notice to the Borrower or any other person or entity, the Maximum Rate, if any, shall automatically fluctuate upward and downward as and in the amount by which such maximum nonusurious rate of interest permitted by applicable law fluctuates.
SECTION 9.14 USA PATRIOT Act
. Each Lender hereby notifies the Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with the Act. Each Credit Party will provide such information and take such actions as are reasonably requested by the Administrative Agent or any Lender in order to assist the Administrative Agent and the Lenders in maintaining compliance with the Patriot Act.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.
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| EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership
By: EDUCATION REALTY OP GP, INC., a Delaware corporation, its General Partner
By: /s/ J. Drew Koester Name: J. Drew Koester
Title: Chief Accounting Officer, Senior Vice President and Assistant Secretary
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The Parent joins in the execution of this Agreement to evidence its agreement to the provisions of Sections 5.01, 5.17, 6.06 and 6.08 of this Agreement.
EDUCATION REALTY TRUST, INC.
By: /s/ J. Drew Koester
Name: J. Drew Koester
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Title: | Chief Accounting Officer, Senior Vice President and Assistant Secretary |
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
KEYBANK, NATIONAL ASSOCIATION,
individually and as Administrative Agent,
By: /s/ Jeffry M. Morrison
Name: Jeffry M. Morrison
Title: Regional Executive
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
REGIONS BANK
By: /s/ T. Barrett Vawter
Name: T. Barrett Vawter
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| Real Estate Corporate Banking |
Address:
1900 5th Avenue North, 15th Floor
Birmingham, Alabama 35203
Attention: Terri Crowe
Telephone No.: (205) 581-7614
Telecopy No.: (205) 264-5456
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
PNC BANK, NATIONAL ASSOCIATION
By: /s/ Andrew T. White
Name: Andrew T. White
Title: Senior Vice President
Address:
1600 Market Street, 31st Floor
Philadelphia, Pennsylvania 19103
Attention: Andrew T. White,
Senior Vice President
Telephone No.: (215) 585-6123
Telecopy No.: (215) 585-5806
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
ROYAL BANK OF CANADA
By: /s/ Brian Gross
Name: Brian Gross
Title: Authorized Signatory
Address:
Global Loans Administration, NY
Three World Financial Center
200 Vesey Street
New York, New York 10281-8098
Attention: Brian Gross
Telephone No.: (212) 266-4047
Telecopy No.: (212) 428-6460
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
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| BANK OF AMERICA, N.A.
By: /s/ Asad A. Rafiq Name: Asad A. Rafiq Title: Vice President
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| Address: 135 S. LaSalle Street Mail Code: IL4-135-06-11 Chicago, Illinois 60603 Attention: Asad A. Rafiq Vice President Telephone No.: (312) 828-4416 Telecopy No.: (312) 992-9767
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Signature page to Credit Agreement with Education Realty Operating Partnership, LP
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| U.S. BANK NATIONAL ASSOCIATION
By: /s/ Lori Y. Jensen Name: Lori Y. Jensen
Title: Senior Vice President
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| Address: 1100 Abernathy Road, N.E., Suite 1250 Atlanta, GA 30328 Attention: Lori Y. Jensen Vice President Telephone No.: (770) 512-3118 Telecopy No.: (770) 512-3130
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Signature page to Credit Agreement with Education Realty Operating Partnership, LP
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| FIRST TENNESSEE BANK, N.A.
By: /s/ James A. Wittenberg III Name: James A. Wittenberg III
Title: Vice President
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| Address: 165 Madison Avenue, 10th Floor Memphis, TN 38103 Attention: James A. Wittenberg III Vice President Telephone No.: (901) 523-4135 Telecopy No.: (901) 523-4032
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Signature page to Credit Agreement with Education Realty Operating Partnership, LP
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| METROPOLITAN BANK
By: /s/ Joelle Rogin Name: Joelle Rogin
Title: Senior Vice President
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| Address: 1661 Aaron Brenner Drive, Suite 100 Memphis, TN 38120 Attention: Joelle Rogin Senior Vice President Telephone No.: (901) 969-8004 Telecopy No.: (901) 969-8100
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| FIFTH THIRD BANK, an Ohio banking corporation
By: /s/ Michael P. Perillo Name: Michael P. Perillo
Title: Officer
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| Address: 222 S. Riverside Plaza Chicago, IL 60606 Attention: Michael P. Perillo Officer Telephone No.: (312) 704-6829 Telecopy No.: (312) 704-7364
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| JPMORGAN CHASE BANK, N.A.
By: /s/ Rita Lai Blumberg Name: Rita Lai Blumberg
Title: Authorized Officer
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| Address: 270 Park Ave., Floor 45 New York, NY 10017 Attention: Rita Lai Blumberg Authorized Officer Telephone No.: (212) 270-6254 Telecopy No.: (646) 534-6301
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SCHEDULE 2.01
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Lender | Revolving Loan Commitment | Applicable Percentage |
KEYBANK, NATIONAL ASSOCIATION | $72,500,000.00 | 14.5% |
PNC BANK, NATIONAL ASSOCIATION | $68,000,000.00 | 13.6% |
REGIONS BANK | $68,000,000.00 | 13.6% |
ROYAL BANK OF CANADA | $68,000,000.00 | 13.6% |
BANK OF AMERICA, N.A. | $50,000,000.00 | 10.0% |
U.S. BANK NATIONAL ASSOCIATION | $50,000,000.00 | 10.0% |
FIRST TENNESSEE BANK, N.A. | $30,000,000.00 | 6.0% |
METROPOLITAN BANK | $8,500,000.00 | 1.7% |
JPMORGAN CHASE BANK, N.A. | $50,000,000.00 | 10.0% |
FIFTH THIRD BANK | $35,000,000.00 | 7.0% |
TOTAL | $500,000,000.00 | 100.0000000000% |
SCHEDULE 3.05(F)
1. Earthquake or Seismic Area –
The Berk
2315 College Ave
Berkeley, California 94704
University Village Towers
3500 Iowa Avenue
Riverside, CA 92507
SCHEDULE 3.07
NONE
SCHEDULE 3.15
LIST OF SUBSIDIARIES
|
| |
109 Tower FL LLC | EDR Phoenix, LLC |
28th and Aurora at Boulder LLC | EDR State College Limited Partnership |
3949 Lindell, LLC | EDR State College, Inc. |
Anderson Road Lafayette LLC | EDR State College, LLC |
Anderson Road Oxford LLC | EDR Statesboro, LLC |
AOD/Raleigh Residence Hall, LLC (Inactive) | EDR Stillwater Limited Partnership |
Blacksburg VA Housing LLC | EDR Stillwater, Inc. |
Cape Place (DE), LLC | EDR Stillwater, LLC |
Carrollton Place, LLC | EDR Storrs LLC |
Centre Lubbock TX LLC | EDR Storrs II LLC |
Chapel Hill Durham NC GP LLC | EDR Storrs IC LLC |
Chapel Hill Durham NC LP | EDR Syracuse Campus West LLC |
Cottages W. Lafayette IN LLC | EDR Syracuse, LLC |
CV East Lansing MI LLC | EDR Tallahassee I, LLC |
District on Apache Tempe AZ LLC | EDR Tallahassee Limited Partnership |
District on 5th Tucson AZ LLC | EDR Tallahassee, Inc. |
EDR Athens I, LLC | EDR Tallahassee, LLC |
EDR Auburn, LLC(Inactive) | EDR Tampa Limited Partnership(Inactive) |
EDR Austin LLC | EDR Tampa, Inc. (Inactive) |
EDR Berkeley LLC | EDR Tampa, LLC(Inactive) |
EDR Berkeley LP | EDR Technology LLC |
EDR Carbondale, LLC | East Edge Tuscaloosa LLC |
EDR Cayce Manager, Inc. (Inactive) | EDR Tuscaloosa LLC |
EDR Cayce, LLC(Inactive) | EDR Wabash Limited Partnership(Inactive) |
EDR Charlottesville LLC | EDR Wabash, Inc. (Inactive) |
EDR Charlottesville Jefferson LLC | EDR Wabash, LLC(Inactive) |
EDR Charlottesville Wertland LLC | EDR Western Michigan Limited Partnership |
EDR Columbia Limited Partnership | EDR Western Michigan, Inc. |
EDR Columbia, Inc. | EDR Western Michigan, LLC |
EDR Columbia, LLC | Education Realty OP GP, Inc. |
EDR Columbus Limited Partnership | Education Realty OP Limited Partner Trust |
EDR Columbus, Inc. | Education Realty Operating Partnership, LP |
EDR Columbus, LLC | Education Realty Trust, Inc. |
EDR Development LLC | Education Realty Trust, LLC |
EDR Employment Resources, LLC | Fifth Street MN LLC |
EDR Fund GP, Inc. | Fort Greene Brooklyn NY LLC |
EDR Gainesville GP, LLC | GM Westberry LLC |
EDR Gainesville Limited Partnership | Irish Row at Vaness LLC |
EDR Greensboro, LLC | Lemon Street Tempe AZ LLC(Inactive) |
EDR Investment Advisor Inc. | Louisville KY Housing Member LLC |
EDR Investment Fund, LP | Louisville KY Housing Manager LLC |
EDR Knoxville Limited Partnership | Province Kent OH LLC |
EDR Knoxville, Inc. | Retreat at Louisville LLC |
EDR Knoxville, LLC | Retreat at State College LLC |
|
| |
EDR Lawrence Limited Partnership(Inactive) | River Place (DE), LLC |
EDR Lawrence, Inc. (Inactive) | San Marcos Student Housing Manager LLC |
EDR Lawrence, LLC(Inactive) | San Marcos Student Housing Owner LLC |
EDR Lexington I LLC | State College Housing LLC |
EDR Lexington II LLC | Stinson at Norman, LLC |
EDR Lexington III LLC | Stillwater Student Housing Manager LLC |
EDR Lexington IV LLC | Stillwater Student Housing Owner LLC |
EDR Lexington V LLC | Suites Lubbock TX LLC |
EDR Lexington VI LLC | The Province Greenville NC LP |
EDR Lexington VII LLC | The Province Greenville NC GP LLC |
EDR Limpar, LLC | University Towers OP GP, LLC |
EDR Lubbock Limited Partnership (Inactive) | University Towers Operating Partnership, LP |
EDR Lubbock, LLC (Inactive) | University Towers Raleigh Services, LLC |
EDR Management Inc. | University Village - Greensboro, LLC |
EDR Manager, LLC | University Village Towers, LLC |
EDR Murfreesboro, LLC (Inactive) | University Village Towers, LP |
EDR OP Development LLC | Varsity Ann Arbor Equity Partners, LLC |
EDR Orlando Limited Partnership | Varsity Ann Arbor MI LLC |
EDR Orlando, Inc. | Varsity at Ann Arbor, LLC |
EDR Orlando, LLC | West Clayton GA LLC |
EDR Oxford, LLC | |
EDR Phoenix/Summa West LLC | |
| |
SCHEDULE 5.12
UNENCUMBERED POOL
1. Players Club Tallahassee – Tallahassee, Leon County, FL
2. 605 West – Durham, Durham County, NC
3. The Commons at Tallahassee – Tallahassee, Leon County, FL
4. 109 Tower – Miami, Miami-Dade County, FL
5. Campus Creek – Oxford, Lafayette County, MS
6. Grandmarc at the Corner – Charlottesville, Albemarle County, VA*
7. Wertland Square – Charlottesville, Albemarle County, VA
8. Jefferson Commons – Charlottesville, Albemarle County, VA
9. Central Hall – Lexington, Fayette County, KY**
10. The Lofts Orlando – Orlando, Orange County, FL
11. Campus Lodge – Gainesville, Alachua County, FL
12. The District on Apache – Tempe, Maricopa County, AZ
13. The District on 5th – Tucson, Pima County, AZ
14. Campus Village – East Lansing, Ingham County, MI*
15. Province at Kent State – Kent, Portage County, OH
16. The Province – Greenville, Pitt County, NC
17. The Berk – Berkeley, Alameda County, CA
18. University Village Tower – Riverside, Riverside County, CA
19. The Retreat at State College – State College, Centre County, PA
20. The Cottages on Lindberg – West Lafayette, Tippecanoe County, IN
21. 2400 Nueces – Austin, Travis County, TX
22. 3949 Lindell – St. Louis, Saint Louis City, MO
23. University Village on Colvin – Syracuse, Onondaga County, NY**
24. Carrollton Crossing – Carrollton, Carroll County, GA
25. The Avenue at Southern – Statesboro, Bulloch County, GA
26. Campus West – Syracuse, Onondaga County, NY*
27. East Edge – Tuscaloosa, Tuscaloosa County, AL
28. The Oaks on the Square – Phase I and II – Storrs, Tolland County, CT
29. Grandmarc at Westberry Place – Fort Worth, Denton County, TX*
30. Woodland Glen I and II – Lexington, Fayette County, KY**
31. The Lotus – Boulder, Boulder County, CO
32. Champions Court II – Lexington, Fayette County, KY**
33. Haggin Hall I – Lexington, Fayette County, KY**
34. Champions Court I – Lexington, Fayette County, KY**
* denotes Eligible Off Campus Ground Lease
** denotes Eligible Property Lease
SCHEDULE 6.02
EXISTING LIENS
None
CREDIT AGREEMENT
EXHIBIT A
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including any letters of credit, guarantees, and swingline loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.
1. Assignor: ______________________________
2. Assignee: ______________________________
[and is an Affiliate/Approved Fund of [identify Lender]]
3. Borrower: Education Realty Operating Partnership, LP
| |
4. | Administrative Agent: KeyBank, National Association, as the administrative agent under the Credit Agreement |
| |
5. | Credit Agreement: The Fifth Amended and Restated Credit Agreement dated as of November 19, 2014, among Education Realty Operating Partnership, LP, the Lenders parties thereto, KeyBank, National Association, as Administrative Agent, and the other agents parties thereto |
6. Assigned Interest:
|
| | |
Aggregate Amount of Commitment/Loans for all Lenders | Amount of Commitment/Loans Assigned | Percentage
Assigned of Commitment/Loans |
$_____ | $_____ | _____% |
$_____ | $_____ | _____% |
$_____ | $_____ | _____% |
| |
Effective Date: | ______________________, 20____ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.] |
The terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:
Title:
[Consented to and] Accepted:
[KeyBank, National Association], as
Administrative Agent
By:
Title:
[Consented to:]
[NAME OF RELEVANT PARTY]
By:
Title:
ANNEX 1
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.
1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, and (v) if it is a Foreign Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.
2. Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.
3. General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.
CREDIT AGREEMENT
EXHIBIT B
FORM OF COMPLIANCE CERTIFICATE
|
| | | | | | | | | | | | | | | | | | | | | | |
|
Key Bank, National Association | | | | | | | |
as Administrative Agent | | | | | | | |
225 Franklin Street | | | | | | | | |
Boston, MA 02110 | | | | | | | | |
| | | | | | | | | |
Attn: Mr. Gregory Lane | | | | | | | |
| | | | | | | | | |
RE: Education Realty Operating Partnership, LP |
| Compliance Certificate for | ____________ | through | __________ |
| | | | | | | | | |
Dear Ladies and Gentlemen:
| | | | | |
This Compliance Certificate is made with reference to that certain Fifth Amended and Restated Credit Agreement dated as of November 19, 2014 (as amended, supplemented or otherwise modified from time to time, the "Credit Agreement"), among Education Realty Operating Partnership, LP (the "Borrower"), the financial institutions party thereto, as lenders, and KeyBank, N.A., as Administrative Agent. All capitalized terms used in this Compliance Certificate (including any attachments hereto) and not otherwise defined in this Compliance Certificate shall have the meanings set forth for such terms in the Credit Agreement. All Section references herein shall refer to the Credit Agreement. |
| | | | | | | | | |
I hereby certify that I am the Chief Accounting Officer of Education Realty Operating Partnership, LP, and that I make this Certificate on behalf of the Borrower. I further represent and certify on behalf of the Borrower as follows as of the date of this Compliance Certificate: |
| | | | | | | | | |
| I have reviewed the terms of the Loan Documents and have made, or have caused to be made under my supervision, a review in reasonable detail of the transactions and consolidated and consolidating financial condition of the Borrower and its Subsidiaries, during the accounting period (the "Reporting Period") covered by the financial reports delivered simultaneous herewith pursuant to Section 5.01[(a)][(b)], and that such review has not disclosed the existence during or at the end of such Reporting Period (and that I do not have knowledge of the existence as at the date hereof) of any condition or event which constitutes a Default or Event of Default. | |
| | | | | | | | | |
| All referenced dollar amounts in this certificate are stated in thousands unless otherwise noted. | | |
| | | | | | | | | |
| Attached hereto as Schedule A-1 is a list of the Real Property that comprises the Unencumbered Pool and the Unencumbered Asset Value, and Schedule A-2 is a list of the Real Property assets that were identified as being in the Unencumbered Pool in the last Compliance Certificate and that are no longer qualified to be in the Unencumbered Pool as of the last day of the Reporting Period. | |
| | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | |
| Attached hereto as Schedule B-1 is a detailed calculation of Interest Expense for the Reporting Period and Schedule B-2 is a detailed calculation of Interest Expense, principal paid and due and payable on Indebtedness, and cash dividends payable on the Parent's preferred stock for the Reporting Period, which amounts aggregated: | |
| | | | | | | | | |
| Schedule B-1 | $ | |
| Schedule B-2 | $ | |
| | | | | | | | | |
| Attached hereto as Schedule C is a detailed calculation of EBITDA for the Reporting Period, which amount was: | |
| | | | | | | | | |
| Schedule C EBITDA | | | | $ | |
| | | | | | | | | |
As of the last day of the Reporting Period: | | | | | | |
| | | | | | | | | |
1. | Fixed Charge Coverage Ratio Calculation: | | | | | |
| | | | | | | | | |
| ( a ) | EBITDA | | | | $ |
| ( b ) | Capital Expenditure Reserve | | | | $ |
| ( c ) | Adjusted EBITDA(a)-(b) | | | | | | $ |
| ( d ) | Principal paid and due and payable plus Interest | | | | |
| | Expense plus cash dividends on preferred stock | | | $ |
| ( d ) | Fixed Charge Coverage Ratio ((c) to ((d)) | | | | |
| | | | | | | | |
| | Covenant: 1.50 :1.00 | | | | | |
| | | | | | | | | |
2. | Tangible Net Worth ("TNW"): | | | | | | |
| | | | | | | | | |
| Total Tangible Net Worth at closing | | | | $___,000,000.00 |
| | | | | | | | | |
| Required Tangible Net Worth | | | | | |
| | | | | | | | | |
| | Net Proceeds of Offerings after Effective Date | $ | | |
| | | | | | | 75 | % | | |
| | | | | | $ | | |
| | | | | | | | | |
| | Plus | | | | $ | | |
| | | | | | | | | |
| | | Total Required Tangible Net Worth | | | $ |
| | | | | | | | | |
| | | Covenant: Current TNW must exceed required TNW | | |
| | | | | | | | | |
3. | Total Leverage Ratio Calculation: | | | | | |
| | | | | | | | | |
| ( a ) | Indebtedness | | | | | $ |
| ( b ) | Total Asset Value | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | |
| ( c ) | Total Leverage Ratio | | | | | % |
| | | | | | | | | |
| | Covenant: less than sixty percent (60%) at all times | | | | | |
| | | | | | | | | |
4. | Total Secured Debt Ratio: | | | | | |
| | | | | | | | | |
| ( a ) | Secured Debt | | | $ |
| ( b ) | Total Asset Value | | | $ |
| ( c ) | Total Secured Debt Ratio | | | % |
| | | | | | | | | |
| | Covenant: no greater than 40% | | | | |
| | | | | | | | | |
5. | Total Unsecured Debt to Unencumbered Asset Value | | | | | |
| | | | | | | | | |
| ( a ) | Total Unsecured Debt | | | $ |
| ( b ) | Unencumbered Asset Value | | | $ |
| | | | | | | | | |
| | Covenant: no greater than 60% | | | | |
| | | | | | | | | |
| | | | | | | | | |
6. | Unsecured Interest Coverage | | | $ |
| | | | | | | | | |
| Adjusted Unencumbered NOI | | $ |
| ( a ) | Unsecured Interest Expense | $ |
| | | | | | | | | |
| | Ratio | | | | ___% |
| | | | | | |
| | Covenant: Not less than 1.75 to 1.0 | | | | |
| | | | | | | | | |
7. | ( a ) | ( i ) | Investments in Unconsolidated Affiliates | | $ |
| | | | | | | | | |
| ( b ) | ( i ) | Investments in undeveloped land | | | $ |
| | | | | | | | | |
| ( c ) | ( i ) | Investments in Assets Under Development | | $ |
| | | | | | | | | |
| | | | | | |
| | | | | | | | | |
| ( d ) | ( i ) | Investments in Real Property not constituting | | | |
| | | collegiate housing communities | | $ |
| | | | | | | | | |
| ( e ) | ( i ) | Investments in undeveloped land, Unconsolidated | | |
| | | Affiliates, Assets Under Development and | | | |
| | | non-collegiate housing communities | $ |
| | ( ii ) | Total Asset Value | | | | $ |
| | ( iii ) | (i) / (ii), expressed as a percentage | | | ___% |
|
| | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
| | Covenant: 30% | | | | |
| | | | | | | | | |
8. | Restricted Payments | | | | | | |
| | | | | | | | | |
| (a) | Restricted Payments to be made on or after ______________ for reporting period |
| | and restricted payments made preceding 3 quarters |
| | | | | | | | | |
| | | 2Q 2009 Dividend per share Common Stock | $ |
| | | 1Q 2009 Dividend per share Common Stock ______ | $ |
| | | 4Q 2008 Dividend per share Common Stock ______ | $ |
| | | 3Q 2008 Dividend per share Common Stock _______ | $ |
| | | | | | | | | |
| This Compliance Certificate has been executed and delivered as of the date set forth above. |
| | | | | | | | | |
| | | | EDUCATION REALTY OPERATING PARTNERSHIP, LP |
| | | | | | | | | |
| | | | By: | Education Realty OP GP, Inc., General Partner |
| | | | | | | | | |
| | | | | | | | | |
| | | | By: | | | | | |
| | | | Name: | J. Drew Koester | | | |
| | | | Title: | Vice President and Chief Accounting Officer |
| | | | | | | | | |
CREDIT AGREEMENT
EXHIBIT C
FORM OF GUARANTY
THIS GUARANTY dated as of _______________, 2014, executed and delivered by the undersigned (the “Guarantor”), in favor of (a) KEYBANK, NATIONAL ASSOCIATION, in its capacity as Administrative Agent (the “Agent”) for the Lenders under that certain Fifth Amended and Restated Credit Agreement dated as of ________, 2014, by and among EDUCATION REALTY OPERATING PARTNERSHIP, LP (the “Borrower”), the financial institutions party thereto and their assignees in accordance therewith (the “Lenders”), and the Agent (as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with its terms, the “Credit Agreement”) and (b) the Lenders.
WHEREAS, pursuant to the Credit Agreement, the Lenders have made available to the Borrower certain financial accommodations on the terms and conditions set forth in the Credit Agreement;
WHEREAS, the Borrower and the Guarantor, though separate legal entities, are mutually dependent on each other in the conduct of their respective businesses as an integrated operation and have determined it to be in their mutual best interests to obtain financing from the Agent and the Lenders through their collective efforts;
WHEREAS, the Guarantor acknowledges that it will receive direct and indirect benefits from the Agent and the Lenders making such financial accommodations available to the Borrower under the Credit Agreement and, accordingly, the Guarantor is willing to guarantee the Borrower’s obligations to the Agent and the Lenders on the terms and conditions contained herein; and
WHEREAS, the Guarantor’s execution and delivery of this Guaranty is one of the conditions precedent to the Agent and the Lenders making, or continuing to make, such financial accommodations to the Borrower.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the Guarantor, the Guarantor agrees as follows:
Section 1. Guaranty. The Guarantor hereby absolutely and unconditionally guaranties the due and punctual payment and performance of all of the following when due (collectively referred to as the “Obligations”): (a) all indebtedness and obligations owing by the Borrower to any of the Lenders or the Agent under or in connection with the Credit Agreement and any other Loan Document, including without limitation, the repayment of all principal of the Loans made by the Lenders to the Borrower under the Credit Agreement and the payment of all interest, fees, charges, reasonable attorneys fees and other amounts payable to any Lender or the Agent thereunder or in connection therewith (including any Hedging Agreement); (b) any and all extensions, renewals, modifications, amendments or substitutions of the foregoing; and (c) all expenses, including, without
limitation, reasonable attorneys’ fees and disbursements, that are incurred by the Lenders or the Agent in the enforcement of any of the foregoing or any obligation of the Guarantor hereunder.
Section 2. Guaranty of Payment and Not of Collection. This Guaranty is a guaranty of payment, and not of collection, and a debt of the Guarantor for its own account. Accordingly, the Lenders and the Agent shall not be obligated or required before enforcing this Guaranty against the Guarantor: (a) to pursue any right or remedy the Lenders or the Agent may have against the Borrower or any other Person or commence any suit or other proceeding against the Borrower or any other Person in any court or other tribunal; (b) to make any claim in a liquidation or bankruptcy of the Borrower or any other Person; or (c) to make demand of the Borrower or any other Person or to enforce or seek to enforce or realize upon any collateral security held by the Lenders or the Agent which may secure any of the Obligations. In this connection, the Guarantor hereby waives the right of the Guarantor to require any holder of the Obligations to take action against the Borrower as provided by any legal requirement of any Governmental Authority.
Section 3. Guaranty Absolute. The Guarantor guarantees that the Obligations will be paid strictly in accordance with the terms of the documents evidencing the same, regardless of any legal requirement now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of the Agent or the Lenders with respect thereto. The liability of the Guarantor under this Guaranty shall be absolute and unconditional in accordance with its terms and shall remain in full force and effect without regard to, and shall not be released, suspended, discharged, terminated or otherwise affected by, any circumstance or occurrence whatsoever (other than the full and final payment and performance of the Obligations), including, without limitation, the following (whether or not the Guarantor consents thereto or has notice thereof):
(a) (i) any change in the amount, interest rate or due date or other term of any of the Obligations; (ii) any change in the time, place or manner of payment of all or any portion of the Obligations; (iii) any amendment or waiver of, or consent to the departure from or other indulgence with respect to, the Credit Agreement, any other Loan Document, or any other document or instrument evidencing or relating to any Obligations; or (iv) any waiver, renewal, extension, addition, or supplement to, or deletion from, or any other action or inaction under or in respect of, the Credit Agreement, any of the other Loan Documents, or any other documents, instruments or agreements relating to the Obligations or any other instrument or agreement referred to therein or evidencing any Obligations or any assignment or transfer of any of the foregoing;
(b) any lack of validity or enforceability of the Credit Agreement, any of the other Loan Documents, or any other document, instrument or agreement referred to therein or evidencing any Obligations or any assignment or transfer of any of the foregoing;
(c) any furnishing to the Agent or the Lenders of any security for the Obligations, or any sale, exchange, release or surrender of, or realization on, any collateral security for the Obligations;
(d) any settlement or compromise of any of the Obligations, any security therefor, or any liability of any other party with respect to the Obligations, or any subordination of the payment of the Obligations to the payment of any other liability of the Borrower;
(e) any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution, liquidation or other like proceeding relating to the Borrower or any other Person, or any action taken with respect to this Guaranty by any trustee or receiver, or by any court, in any such proceeding;
(f) any nonperfection of any security interest or other Lien on any of the collateral securing any of the Obligations;
(g) any act or failure to act by the Borrower or any other Person which may adversely affect the Guarantor’s subrogation rights, if any, against the Borrower to recover payments made under this Guaranty;
(h) any application of sums paid by the Borrower or any other Person with respect to the liabilities of the Borrower to the Agent or the Lenders, regardless of what liabilities of the Borrower remain unpaid;
(i) any defect, limitation or insufficiency in the borrowing powers of the Borrower or in the exercise thereof; or
(j) any other circumstance which might otherwise constitute a defense available to, or a discharge of, the Guarantor hereunder.
Section 4. Action with Respect to Obligations. The Lenders and the Agent may in accordance with the Credit Agreement, at any time and from time to time, without the consent of, or notice to, the Guarantor, and without discharging the Guarantor from its obligations hereunder take any and all actions described in Section 3 and may otherwise: (a) amend, modify, alter or supplement the terms of any of the Obligations, including, but not limited to, extending or shortening the time of payment of any of the Obligations or the interest rate that may accrue on any of the Obligations; (b) amend, modify, alter or supplement the Credit Agreement or any other Loan Document; (c) sell, exchange, release or otherwise deal with all, or any part, of any collateral securing any of the Obligations; (d) release any Person liable in any manner for the payment or collection of the Obligations; (e) exercise, or refrain from exercising, any rights against the Borrower or any other Person; and (f) apply any sum, by whomsoever paid or however realized, to the Obligations in such order as the Lenders or the Agent shall elect in accordance with the Credit Agreement.
Section 5. Representations and Warranties. The Guarantor hereby makes to the Agent and the Lenders all of the representations and warranties made by the Borrower with respect to or in any way relating to the Guarantor in the Credit Agreement and the other Loan Documents, as if the same were set forth herein in full.
Section 6. Covenants. The Guarantor will comply with all covenants which the Borrower is to cause the Guarantor to comply with under the terms of the Credit Agreement or any other Loan Documents.
Section 7. Waiver. The Guarantor, to the fullest extent permitted by applicable law, hereby waives notice of acceptance hereof or any presentment, demand, protest or notice of any kind, and any other act or thing, or omission or delay to do any other act or thing, which in any manner or to
any extent might vary the risk of the Guarantor or which otherwise might operate to discharge the Guarantor from its obligations hereunder.
Section 8. Inability to Accelerate Loan. If the Agent and/or the Lenders are prevented from demanding or accelerating payment thereof by reason of any automatic stay or otherwise, the Agent and/or the Lenders shall be entitled to receive from the Guarantor, upon demand therefor, the sums which otherwise would have been due had such demand or acceleration occurred.
Section 9. Reinstatement of Obligations. The Guarantor agrees that this Guaranty shall continue to be effective or be reinstated, as the case may be, with respect to any Obligations if at any time payment of any such Obligations is rescinded or otherwise must be restored by the Agent and/or the Lenders upon the bankruptcy or reorganization of the Borrower or the Guarantor or otherwise.
Section 10. Subrogation. Until all of the Obligations shall have been indefeasibly paid in full, any right of subrogation the Guarantor may have shall be subordinate to the rights of Agent and the Lenders and the Guarantor hereby waives any right to enforce any remedy which the Agent and/or the Lenders now have or may hereafter have against the Borrower, and the Guarantor hereby waives any benefit of, and any right to participate in, any security or collateral given to the Agent and the Lenders to secure payment or performance of any of the Obligations.
Section 11. Payments Free and Clear. All sums payable by the Guarantor hereunder shall be made free and clear of and without deduction for any Indemnified Taxes (as defined in the Credit Agreement) or Other Taxes (as defined in the Credit Agreement); provided that if the Guarantor shall be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section), the Agent, Lender or Issuing Bank (as defined in the Credit Agreement) (as the case may be) receives an amount equal to the sum it would have received had no such deductions been made; (ii) the Guarantor shall make such deductions; and (iii) the Guarantor shall pay the full amount deducted to the relevant Governmental Authority (as defined in the Credit Agreement) in accordance with applicable law.
Section 12. Set-off. In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, each Lender is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender to or for the credit or the account of the Guarantor against any of and all the obligations of the Guarantor now or hereafter existing under this Guaranty held by such Lender then due and payable. The Guarantor agrees, to the fullest extent it may effectively do so under applicable law, that any holder of a participation in a Note, whether or not acquired pursuant to the applicable provisions of the Credit Agreement, may exercise rights of setoff or counterclaim and other rights with respect to such participation as fully as if such holder of a participation were a direct creditor of the Guarantor in the amount of such participation.
Section 13. Subordination. The Guarantor hereby expressly covenants and agrees for the benefit of the Agent and the Lenders that all obligations and liabilities of the Borrower to the
Guarantor of whatever description, including without limitation, all intercompany receivables of the Guarantor from the Borrower (collectively, the “Junior Claims”) shall be subordinate and junior in right of payment to all Obligations; provided, however, that payment thereof may be made so long as no Event of Default shall have occurred and be continuing. If an Event of Default shall have occurred and be continuing, then the Guarantor shall not accept any direct or indirect payment (in cash, property, securities by setoff or otherwise) from the Borrower on account of or in any manner in respect of any Junior Claim until all of the Obligations have been indefeasibly paid in full.
Section 14. Avoidance Provisions. It is the intent of the Guarantor, the Agent and the Lenders that in any Proceeding, the Guarantor’s maximum obligation hereunder shall equal, but not exceed, the maximum amount which would not otherwise cause the obligations of the Guarantor hereunder (or any other obligations of the Guarantor to the Agent and the Lenders) to be avoidable or unenforceable against the Guarantor in such Proceeding as a result of applicable law, including without limitation, (a) Section 548 of the Bankruptcy Code of 1978, as amended (the “Bankruptcy Code”) and (b) any state fraudulent transfer or fraudulent conveyance act or statute applied in such Proceeding, whether by virtue of Section 544 of the Bankruptcy Code or otherwise. The applicable laws under which the possible avoidance or unenforceability of the obligations of the Guarantor hereunder (or any other obligations of the Guarantor to the Agent and the Lenders) shall be determined in any such Proceeding are referred to as the “Avoidance Provisions.” Accordingly, to the extent that the obligations of the Guarantor hereunder would otherwise be subject to avoidance under the Avoidance Provisions, the maximum Obligations for which the Guarantor shall be liable hereunder shall be reduced to that amount which, as of the time any of the Obligations are deemed to have been incurred under the Avoidance Provisions, would not cause the obligations of the Guarantor hereunder (or any other obligations of such Guarantor to the Agent and the Lenders), to be subject to avoidance under the Avoidance Provisions. This Section is intended solely to preserve the rights of the Agent and the Lenders hereunder to the maximum extent that would not cause the obligations of the Guarantor hereunder to be subject to avoidance under the Avoidance Provisions, and the Guarantor and no other Person shall have any right or claim under this Section as against the Agent and the Lenders that would not otherwise be available to such Person under the Avoidance Provisions.
Section 15. Information. The Guarantor assumes all responsibility for being and keeping itself informed of the financial condition of the Borrower and of all other circumstances bearing upon the risk of nonpayment of any of the Obligations and the nature, scope and extent of the risks that the Guarantor assumes and incurs hereunder, and agrees that none of the Agent or any Lender shall have any duty whatsoever to advise the Guarantor of information regarding such circumstances or risks.
Section 16. Governing Law. THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 17. Jurisdiction; Venue; JURY WAIVER.
(a) The Guarantor hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the state and federal courts in Boston, Massachusetts and in New York, New York, and any appellate court from any thereof, in any action or proceeding
arising out of or relating to this Guaranty or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees 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. Nothing in this Guaranty shall affect any right that the Agent, the Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Guaranty or any other Loan Document against the Guarantor or its properties in the courts of any jurisdiction.
(c) The Guarantor hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Guaranty or any other Loan Document in any court referred to in paragraph (a) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d) WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTY, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
Section 18. Loan Accounts. The Agent may maintain books and accounts setting forth the amounts of principal, interest and other sums paid and payable with respect to the Obligations, and in the case of any dispute relating to any of the outstanding amount, payment or receipt of Obligation or otherwise, the entries in such account shall be binding upon the Guarantor as to the outstanding amount of such Obligations and the amounts paid and payable with respect thereto absent manifest error. The failure of the Agent to maintain such books and accounts shall not in any way relieve or discharge the Guarantor of any of its obligations hereunder.
Section 19. Waiver of Remedies. No delay or failure on the part of the Agent or the Lenders in the exercise of any right or remedy it may have against the Guarantor hereunder or otherwise shall operate as a waiver thereof, and no single or partial exercise by the Agent or the Lenders of any such right or remedy shall preclude other or further exercise thereof or the exercise of any other such right or remedy.
Section 20. Successors and Assigns. Each reference herein to the Agent or the Lenders shall be deemed to include such Person’s respective successors and assigns (including, but not limited to, any holder of the Obligations) in whose favor the provisions of this Guaranty also shall inure, and each reference herein to the Guarantor shall be deemed to include the Guarantor’s successors and assigns, upon whom this Guaranty also shall be binding. The Lenders and the Agent may, in accordance with the applicable provisions of the Credit Agreement, assign, transfer or sell any Obligation, or grant or sell participation in any Obligations, to any Person or entity without the consent of, or notice to, the Guarantor and without releasing, discharging or modifying the Guarantor’s obligations hereunder. The Guarantor hereby consents to the delivery by the Agent or any Lender to any assignee, transferee or participant of any financial or other information regarding the Borrower or the Guarantor. The Guarantor may not assign or transfer its obligations hereunder to any Person.
Section 21. Amendments. This Guaranty may not be amended except as provided in the Credit Agreement.
Section 22. Payments. All payments made by the Guarantor pursuant to this Guaranty shall be made in Dollars, in immediately available funds to the Agent at the place and time provided for in the Credit Agreement on the date one (1) Business Day after written demand therefor to the Guarantor by the Agent.
SECTION 23. RESERVED.
Section 24. Notices. All notices, requests and other communications hereunder shall be in writing and shall be given as provided in the Loan Agreement. The Guarantor’s address for notice is set forth below its signature hereto.
Section 25. Severability. In case any provision of this Guaranty shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Section 26. Headings. Section headings used in this Guaranty are for convenience only and shall not affect the construction of this Guaranty.
Section 27. Definitions. (a) For the purposes of this Guaranty:
“Proceeding” means any of the following: (i) a voluntary or involuntary case concerning the Guarantor shall be commenced under the Bankruptcy Code or any other applicable bankruptcy laws; (ii) a custodian (as defined in the Bankruptcy Code or any other applicable bankruptcy laws) is appointed for, or takes charge of, all or any substantial part of the property of the Guarantor; (iii) any other proceeding under any applicable law, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding-up or composition for adjustment of debts, whether now or hereafter in effect, is commenced relating to the Guarantor; (iv) the Guarantor is adjudicated insolvent or bankrupt; (v) any order of relief or other order approving any such case or proceeding is entered by a court of competent jurisdiction; (vi) the Guarantor makes a general assignment for the benefit of creditors; (vii) the Guarantor shall fail to pay, or shall state that it is unable to pay, or
shall be unable to pay, its debts generally as they become due; (viii) the Guarantor shall call a meeting of its creditors with a view to arranging a composition or adjustment of its debts; (ix) the Guarantor shall by any act or failure to act indicate its consent to, approval of or acquiescence in any of the foregoing; or (x) any corporate action shall be taken by the Guarantor for the purpose of effecting any of the foregoing.
(b) Terms not otherwise defined herein are used herein with the respective meanings given them in the Credit Agreement.
IN WITNESS WHEREOF, the Guarantor has duly executed and delivered this Guaranty as of the date and year first written above.
EDUCATION REALTY TRUST, INC.
By:
Name:
Title:
Address for Notices:
c/o EDUCATION REALTY OPERATING
PARTNERSHIP, LP
999 South Shady Grove Road, Suite 600
Memphis, Tennessee 38120
Attention: ______________
CREDIT AGREEMENT
EXHIBIT D
FORM OF NOTE
$_________________ __________, 2014
FOR VALUE RECEIVED, Education Realty Operating Partnership, LP (the “Maker”) promises to pay without offset or counterclaim to the order of [insert name of Lender], (“Payee”), the principal amount equal to the lesser of (x) __________________________ ($_____________) or (y) the outstanding amount advanced by Payee as a Loan (or Loans) under the Credit Agreement (as hereinafter defined), payable in accordance with the terms of the Credit Agreement.
Maker also promises to pay interest on the unpaid principal amount of this Note (this “Note”) at the rates and at the times which shall be determined in accordance with the provisions of that certain Fifth Amended and Restated Credit Agreement dated of even date herewith, among Maker, the Lenders named therein, and KeyBank, National Association, as Administrative Agent for itself and the Lenders (as hereafter amended, supplemented or otherwise modified from time to time, the “Credit Agreement”). Capitalized terms used herein without definition shall have the meanings set forth in the Credit Agreement.
Subject to the terms and provisions of the Credit Agreement, amounts borrowed may be repaid and reborrowed at any time prior to the termination of the Availability Period. No Lender shall have any obligation to make a Loan to the extent such Loan would cause the sum of the total Revolving Credit Exposures to exceed the total Maximum Loan Available Amount.
This Note is subject to mandatory prepayment and prepayment at the option of the Maker, as provided in the Credit Agreement.
This Note is issued pursuant to the Credit Agreement and is entitled to the benefits of the Credit Agreement, reference to which is hereby made for a more complete statement of the terms and conditions under which the Loan evidenced hereby is made and is to be repaid.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. MAKER AGREES THAT JURISDICTION AND VENUE FOR ANY ACTION REGARDING THIS NOTE SHALL BE AS SET FORTH IN THE CREDIT AGREEMENT.
Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement.
Maker promises to pay all fees, costs and expenses incurred in the collection and enforcement of this Note in accordance with the terms of the Credit Agreement. Maker and any endorser of this Note hereby consents to renewals and extensions of time at or after the maturity hereof, without notice, and hereby waive diligence, presentment, protest, demand and notice of every kind (except such notices as may be expressly required under the Credit Agreement or the other Loan Documents) and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder.
Whenever possible, each provision of this Note shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Note shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Note.
IN WITNESS WHEREOF, Maker has caused this Note to be executed and delivered by its duly authorized officer, as of the day and year first written above.
|
|
EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership
By: EDUCATION REALTY OP GP, INC., a Delaware corporation, its General Partner
By:_______________________________ Name:__________________________ Title:___________________________ |
CREDIT AGREEMENT
EXHIBIT E
[FORM OF] BORROWING REQUEST/INTEREST ELECTION REQUEST
[Date]
KeyBank, National Association
as Administrative Agent
225 Franklin Street, 18th floor
Boston, Massachusetts 02110
Attn: Mr. Gregory Lane
Re: Education Realty Operating Partnership, LP
Borrowing Request
Dear Ladies and Gentlemen:
This Borrowing Request is made with reference to that certain Fifth Amended and Restated Credit Agreement dated as of November 19, 2014 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Education Realty Operating Partnership, LP (the “Borrower”), the financial institutions party thereto, as lenders, and KeyBank, National Association, as Administrative Agent. All capitalized terms used in this Borrowing Request (including any attachments hereto) and not otherwise defined in this Borrowing Request shall have the meanings set forth for such terms in the Credit Agreement. All Section references herein shall refer to the Credit Agreement. This request is made by Education Realty Operating Partnership, LP on behalf of the Borrower.
The Borrower hereby requests [check as applicable] □ a conversion of an existing Loan as provided below and/or □ an advance under the Credit Agreement, in the amount of $____________ [minimum of $1,000,000.00 and in multiples of $100,000.00].
1. Aggregate Commitment $__,000,000.00
2. Maximum Loan Available Amount $_____________
3. The amount outstanding under the
Revolving Loans and Swingline Loans $_____________
4. LC Exposure $_____________
5. Available amount (lesser of 1 or 2, minus 3, minus 4) $_____________
6. Less amount requested ($____________)
7. Amount remaining to be advanced $____________
The advance or conversion is to be made as follows:
A. ABR Borrowing.
| |
1. | Amount of ABR Borrowing: $_____________ |
| |
2. | Date of ABR Borrowing _____________ |
B. Eurodollar Borrowing:
| |
1. | Amount of Eurodollar Borrowing: $_____________ |
| |
2. | Amount of conversion of existing |
Loan to Eurodollar Borrowing: $_____________
Borrowing(s) now in effect: _____________
[cannot exceed six (6)]
| |
4. | Date of Eurodollar Rate Borrowing |
or conversion: _____________
| |
5. | Interest Period: _____________ |
| |
6. | Expiration date of current Interest |
Period as to this conversion: _____________
The Borrower hereby represents and warrants that the amounts set forth above are true and correct, that the amount above requested has actually been incurred, that the representations and warranties contained in the Credit Agreement are true and correct as if made as of this date (except to the extent relating to a specific date), and that the Borrower has kept, observed,
performed and fulfilled each and every one of its obligations under the Credit Agreement as of the date hereof [except as follows: _______________]
Very truly yours,
EDUCATION REALTY OPERATING PARTNERSHIP, LP
By: EDUCATION REALTY OP GP, INC., its General Partner
By:
Name:
Title:
1758471.7
EXHIBIT 10.2
AMENDED AND RESTATED CREDIT AGREEMENT
dated as of
November 19, 2014
among
EDUCATION REALTY OPERATING PARTNERSHIP, LP,
as Borrower
and
The Lenders Party Hereto
and
PNC BANK, NATIONAL ASSOCIATION,
as Administrative Agent
PNC CAPITAL MARKETS LLC and REGIONS CAPITAL MARKETS,
AS JOINT-BOOKRUNNERS AND JOINT LEAD ARRANGERS
REGIONS BANK,
as Syndication Agent
U.S. BANK NATIONAL ASSOCIATION,
as Documentation Agent
TABLE OF CONTENTS
ARTICLE I Definitions 1
SECTION 1.01 Defined Terms 1
SECTION 1.02 Classification of Loans and Borrowings 24
SECTION 1.03 Terms Generally 24
SECTION 1.04 Accounting Terms; GAAP 25
ARTICLE II The Credits 25
SECTION 2.01 Commitments 25
SECTION 2.02 Loans and Borrowings. 25
SECTION 2.03 RESERVED. 26
SECTION 2.04 RESERVED. 26
SECTION 2.05 RESERVED. 26
SECTION 2.06 Funding of Borrowings. 26
SECTION 2.07 Interest Elections. 27
SECTION 2.08 Increase of Commitments. 28
SECTION 2.09 Repayment of Loans; Evidence of Debt. 28
SECTION 2.10 Prepayment of Loans. 29
SECTION 2.11 Fees. 30
SECTION 2.12 Interest. 30
SECTION 2.13 Alternate Rate of Interest 31
SECTION 2.14 Increased Costs. 31
SECTION 2.15 Break Funding Payments 32
SECTION 2.16 Taxes. 33
SECTION 2.17 Payments Generally; Pro Rata Treatment; Sharing of Set-offs. 34
SECTION 2.18 Defaulting Lenders 36
SECTION 2.19 Mitigation Obligations; Replacement of Lenders. 37
ARTICLE III Representations and Warranties 38
SECTION 3.01 Organization; Powers 38
SECTION 3.02 Authorization; Enforceability 38
SECTION 3.03 Governmental Approvals; No Conflicts 39
SECTION 3.04 Financial Condition; No Material Adverse Change. 39
SECTION 3.05 Properties. 39
SECTION 3.06 Intellectual Property 41
SECTION 3.07 Litigation and Environmental Matters. 41
SECTION 3.08 Compliance with Laws and Agreements 43
SECTION 3.09 Investment and Holding Company Status 43
SECTION 3.10 Taxes 43
SECTION 3.11 ERISA 43
SECTION 3.12 Disclosure 44
SECTION 3.13 Insurance 44
SECTION 3.14 Margin Regulations 44
SECTION 3.15 Subsidiaries; REIT Qualification 44
ARTICLE IV Conditions 44
SECTION 4.01 Effective Date 45
SECTION 4.02 Each Credit Event 45
ARTICLE V Affirmative Covenants 46
SECTION 5.01 Financial Statements; Ratings Change and Other Information 46
SECTION 5.02 Financial Tests 47
SECTION 5.03 Notices of Material Events 48
SECTION 5.04 Existence; Conduct of Business 48
SECTION 5.05 Payment of Obligations 48
SECTION 5.06 Maintenance of Properties; Insurance. 48
SECTION 5.07 Books and Records; Inspection Rights. 49
SECTION 5.08 Compliance with Laws 49
SECTION 5.09 Use of Proceeds 49
SECTION 5.10 Fiscal Year 49
SECTION 5.11 Environmental Matters. 49
SECTION 5.12 Unencumbered Pool 50
SECTION 5.13 Additions to Unencumbered Pool 50
SECTION 5.14 Removal of Real Property from Unencumbered Pool 51
SECTION 5.15 Further Assurances 51
SECTION 5.16 [Reserved] 51
SECTION 5.17 Parent Covenants 51
SECTION 5.18 OFAC 51
ARTICLE VI Negative Covenants 52
SECTION 6.01 Sale/Leaseback 52
SECTION 6.02 Liens 52
SECTION 6.03 Fundamental Changes 52
SECTION 6.04 Investments, Loans, Advances and Acquisitions 53
SECTION 6.05 Hedging Agreements 54
SECTION 6.06 Restricted Payments 54
SECTION 6.07 Transactions with Affiliates 54
SECTION 6.08 Parent Negative Covenants 54
SECTION 6.09 Restrictive Agreements 55
SECTION 6.10 Indebtedness 55
ARTICLE VII Events of Default 56
ARTICLE VIII The Administrative Agent 58
ARTICLE IX Miscellaneous 60
SECTION 9.01 Notices 60
SECTION 9.02 Waivers; Amendments. 61
SECTION 9.03 Expenses; Indemnity; Damage Waiver. 63
SECTION 9.04 Successors and Assigns. 64
SECTION 9.05 Survival 67
SECTION 9.06 Counterparts; Integration; Effectiveness; Joint and Several. 67
SECTION 9.07 Severability 68
SECTION 9.08 Right of Setoff 69
SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process. 69
SECTION 9.10 WAIVER OF JURY TRIAL 70
SECTION 9.11 Headings 70
SECTION 9.12 Confidentiality 70
SECTION 9.13 Interest Rate Limitation 71
SECTION 9.14 USA PATRIOT Act 71
SCHEDULES:
Schedule 2.01 – Commitments
Schedule 3.05(f) – Earthquake or Seismic Area
Schedule 3.07 – Litigation
Schedule 3.15 – Subsidiaries
Schedule 5.12 – Unencumbered Pool
Schedule 6.02 -- Existing Liens
EXHIBITS:
Exhibit A -- Form of Assignment and Acceptance
Exhibit B – Form of Compliance Certificate
Exhibit C – Form of Guaranty
Exhibit D – Form of Note
Exhibit E – Form of Interest Rate Election
THIS AMENDED AND RESTATED CREDIT AGREEMENT AMENDS AND RESTATES THAT CERTAIN CREDIT AGREEMENT DATED JANUARY 13, 2014 (AS SAME WAS AMENDED FROM TIME TO TIME, THE “ORIGINAL CREDIT AGREEMENT”), ENTERED INTO BETWEEN EDUCATION REALTY OPERATING PARTNERSHIP, LP AND CERTAIN OF ITS SUBSIDIARIES, AS BORROWER, PNC BANK, NATIONAL ASSOCIATION, AS ADMINISTRATIVE AGENT, REGIONS BANK, AS SYNDICATION AGENT, AND PNC CAPITAL MARKETS LLC and REGIONS CAPITAL MARKETS, AS JOINT-BOOKRUNNERS AND JOINT LEAD ARRANGERS, AND THE VARIOUS LENDERS PARTY THERETO
AMENDED AND RESTATED CREDIT AGREEMENT (“Agreement”)
dated as of November 19, 2014, among
EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership,
the LENDERS party hereto,
PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent, and
PNC CAPITAL MARKETS LLC and REGIONS CAPITAL MARKETS, as Joint Bookrunners and Joint Lead Arrangers
REGIONS BANK as Syndication Agent
U.S. BANK NATIONAL ASSOCIATION as Documentation Agent
ARTICLE I
Definitions
SECTION 1.01 Defined Terms . As used in this Agreement, the following terms have the meanings specified below:
“ABR,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.
“Acceptable Unencumbered Property” means Real Property (a) that is approved by the Administrative Agent and the Majority Lenders in their sole discretion, or (b) that at all times satisfies all of the following criteria as certified by Borrower: (i) such Real Property is wholly-owned (directly or indirectly) by Borrower or a Property Subsidiary which is a wholly owned
Subsidiary of the Borrower or a Subsidiary that is part of the Consolidated Group, either in fee simple title or through an Eligible Off Campus Ground Lease or an Eligible Property Lease; (ii) is not subject to a Lien in favor of any Person in any manner, other than Permitted Encumbrances; (iii) consists of completed income-producing, first-class collegiate housing communities of scope and quality consistent with the Borrower’s overall portfolio of Real Property; (iv) is located in states in the United States of America; (v) is managed by the Borrower, its Subsidiary or the Management Company; (vi) a final certificate of occupancy, or the local equivalent, has been issued by the appropriate Governmental Authority for all of the improvements on the Real Property; (vii) no material deferred maintenance and no material deferred capital improvements are required to continue operating as a first-class collegiate housing community, as determined by an architectural or engineering report; and (viii) the owner of the subject Real Property must be able to make the representations and warranties in Sections 3.05 and 3.07 as to such Real Property.
“Adjusted EBITDA” means, for a given testing period, EBITDA less the Capital Expenditure Reserve.
“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of 1%) determined by Administrative Agent equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.
“Adjusted Unencumbered NOI” means Unencumbered NOI for the most recently ended testing period less the Capital Expenditures Reserve.
“Administrative Agent” means PNC Bank, National Association, in its capacity as administrative agent for the Lenders hereunder.
“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.
“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.
“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%, and (c) the then applicable Adjusted LIBO Rate for one month interest periods, plus 1.00% per annum. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.
"Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Parent or its Subsidiaries from time to time concerning or relating to bribery or corruption.
“Applicable Percentage” means, with respect to any Lender, the ratio, expressed as a percentage, of (a) the aggregate outstanding principal amount of such Lender’s Loans to (b) the aggregate outstanding principal amount of all Loans; provided, however, that if at the time of determination all Loans have been paid in full, the “Applicable Percentage” of each Lender shall be the Applicable Percentage of such Lender in effect immediately prior to such payment in full.
“Applicable Rate” means, as applicable from time to time:
(a) subject to clause (b) below, for any day, with respect to any Tranche A ABR Loan, Tranche A Eurodollar Loan, Tranche B ABR Loan or Tranche B Eurodollar Loan, as the case may be, the applicable rate per annum set forth below under the caption “ABR Spread” or “Eurodollar Spread,” as the case may be, based upon the Total Leverage Ratio applicable on such date:
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Total Leverage Ratio | Tranche A ABR Spread | Tranche A Eurodollar Spread | Tranche B ABR Spread | Tranche B Eurodollar Spread |
Category 1 <40% | 0.55% | 1.55% | 0.20% | 1.20% |
Category 2 >40% but <45% | 0.65% | 1.65% | 0.30% | 1.30% |
Category 3 >45% but <50% | 0.80% | 1.80% | 0.45% | 1.45% |
Category 4 > 50% but <55% | 1.00% | 2.00% | 0.65% | 1.65% |
Category 5 > 55% | 1.25% | 2.25% | 0.90% | 1.90% |
Each change in the Applicable Rate shall apply during the period commencing on the date of the most recent Compliance Certificate delivered to the Administrative Agent and ending on the date of receipt of the next Compliance Certificate pursuant to Section 5.01(c). If a Compliance Certificate is not delivered to the Administrative Agent in accordance with Section 5.01(c) the Applicable Rate shall be deemed to be in Category 4 until the required Compliance Certificate is delivered to the Administrative Agent.
(b) If Parent or Borrower obtains an Investment Grade Rating, the Borrower may, upon written notice to the Administrative Agent, make an irrevocable one time election to exclusively use the below table based on the applicable rate per annum set forth in the below table notwithstanding any failure of the Parent or Borrower to maintain an Investment Grade Rating or any failure of the Parent or Borrower to maintain a Debt Rating.
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Investment Grade Rating | Tranche A ABR Spread | Tranche A Eurodollar Spread | Tranche B ABR Spread | Tranche B Eurodollar Spread |
Category 1 At least A- or A3 | 0.30% | 1.30% | 0.0% | 0.95% |
Category 2 At least BBB+ or Baa1 | 0.40% | 1.40% | 0.05% | 1.05% |
Category 3 At least BBB or Baa2 | 0.55% | 1.55% | 0.20% | 1.20% |
Category 4 At least BBB- or Baa3 | 0.80% | 1.80% | 0.45% | 1.45% |
Category 5 Below BBB-, Baa3 or unrated | 1.25% | 2.25% | 0.90% | 1.90% |
Each change in the Applicable Rate resulting from a change in the Debt Rating of the Parent or Borrower shall be effective for the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change. Notwithstanding the above, if at any time there is a split in the Debt Ratings of Parent or Borrower, then the Applicable Rate shall be determined by reference to the most favored rating of S&P, Fitch or Moody’s. If the Parent or Borrower does not have any Debt Rating, Category 5 shall apply.
“Approved Fund” has the meaning set forth in Section 9.04(b).
“Assets Under Development” means all Real Property, or phases thereof, that is under construction or development as an income-producing project in a diligent manner and in accordance with industry standard construction schedules, but for which a certificate of occupancy has not been issued.
“Assignment and Acceptance” means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.
“Board” means the Board of Governors of the Federal Reserve System of the United States of America.
“Bond Facility” means the $250,000,000 of unsecured senior bonds issued by Borrower via public bond offering on November 19, 2014 maturing on November 19, 2024 or any other issuance of public or private senior unsecured bonds by Borrower.
“Borrower” means, Education Realty Operating Partnership, LP, a Delaware limited partnership.
“Borrowing” means Loans of the same Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which any Interest Period is in effect.
“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in Pittsburgh, Pennsylvania or New York, New York are authorized or required by law to remain closed; provided that, when used in connection with a Eurodollar Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.
“Capital Expenditure Reserve” means, on an annual basis, an amount equal to (a) the aggregate number of beds available for lease in each Real Property parcel owned by Borrower or any Subsidiary measured as of the last day of each of the immediately preceding four (4) calendar quarters and averaged, multiplied by (b) $125.00.
“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.
“Change in Control” means (a) the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or affiliated group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof), of shares representing more than thirty percent (30%) of the aggregate ordinary voting power represented by the issued and outstanding capital stock of the Parent; (b) occupation of a majority of the seats (other than vacant seats) on the board of directors of the Parent by Persons who were neither (i) nominated by the board of directors of the Parent nor (ii) appointed by directors so nominated; or (c) the acquisition of direct or indirect Control of the Parent by any Person or group.
“Change in Law” means (a) the adoption of any law, rule or regulation after the date of this Agreement by any Governmental Authority, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) compliance by any Lender (or, for purposes of Section 2.14(b), by any lending office of such Lender or by such Lender's holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the date of this Agreement. Notwithstanding anything herein to the contrary, (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (b) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.
“Class,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Tranche A Loans or Tranche B Loans.
“Code” means the Internal Revenue Code of 1986, as amended from time to time.
“Commitment” means, with respect to each Lender, the commitment of such Lender to make, as applicable, Tranche A Loans and/or Tranche B Loans hereunder, expressed as an amount representing the maximum aggregate amount(s) of such Lender's Tranche A Commitment and/or Tranche B Commitment, as each such Commitment may be reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04, or increased pursuant to Section 2.08. The initial amount(s) of each Lender's Commitment is set forth on Schedule 2.01, or in the Assignment and Acceptance pursuant to which such Lender shall have assumed its Commitment, as applicable. The initial aggregate amount of the Lenders’ Commitments is $187,500,000.00.
“Compliance Certificate” has the meaning set forth in Section 5.01(c) hereof and a form of which is attached hereto as Exhibit B.
“Consolidated Group” means Parent and all Persons whose financial results are consolidated with Parent for financial reporting purposes under GAAP.
“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise, which includes the customary powers of a managing member of any limited liability company, any general partner of any limited partnership, or any board of directors of a corporation. “Controlling” and “Controlled” have meanings correlative thereto.
“Credit Party” means the Borrower and the Guarantor.
“Debt Rating” means, as of any date of determination, the rating as determined by either (a) S&P, (b) Moody's or (c) Fitch and either of S&P and Moody’s, of a Person’s non-credit enhanced, senior unsecured long term debt. The Debt Rating in effect at any date is the Debt Rating that is in effect at the close of business on such date.
“Debtor Relief Laws” means any applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, insolvency, fraudulent conveyance, reorganization, or similar laws affecting the rights, remedies, or recourse of creditors generally, including without limitation the United States Bankruptcy Code and all amendments thereto, as are in effect from time to time during the term of this Agreement.
“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.
“Defaulting Lender” means, subject to Section 2.18, any Lender that: (a) has failed to perform any of its funding obligations hereunder, including in respect of its Commitment, within two (2) Business Days of the date required to be funded by it hereunder; (b) has notified the Borrower or Administrative Agent that it does not intend to comply with its funding obligations or has made a public statement to that effect with respect to its funding obligations hereunder (unless such notification or public statement relates to such Lender’s obligation to fund a Loan hereunder and indicates that such position is based on such Lender’s good faith determination that a condition precedent (specifically identified and including the particular Default, if any) to funding a Loan is
not or cannot be satisfied) or under other agreements in which it commits to extend credit; (c) has failed, within two (2) Business Days after written request by the Administrative Agent or Borrower (and the Administrative Agent has received a copy of such request), to confirm in a manner reasonably satisfactory to the Administrative Agent that it will comply with its funding obligations hereunder; or (d) has, or has a direct or indirect parent company that has: (i) become the subject of a proceeding under any Debtor Relief Law; (ii) had a receiver, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or a custodian appointed for it; or (iii) in the good faith determination of the Administrative Agent, taken any material action in furtherance of, or indicated its consent to, approval of or acquiescence in any such proceeding or appointment; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority; provided, further, that such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Lender.
“Dollars” or “$” refers to lawful money of the United States of America.
“EBITDA” means an amount derived from (a) net income, plus (b) deferred fee revenue and interest income associated with third party development efforts that have commenced, plus (c) to the extent included in the determination of net income, depreciation, amortization, interest expense and income taxes, plus or minus (d) to the extent included in the determination of net income, straight line impact of GAAP land lease expense, plus or minus (e) to the extent included in the determination of net income, any extraordinary losses or gains resulting from sales or payment of Indebtedness, and (f) as approved by the Administrative Agent, such approval not to be unreasonably withheld, any extraordinary, non-recurring expenses associated with any financing, merger, acquisition, divestiture, asset impairment or other capital transaction, in each case, as determined on a consolidated basis in accordance with GAAP, and including (without duplication) the Equity Percentage of EBITDA for the Borrower’s Unconsolidated Affiliates. If EBITDA is calculated over a period of less than four (4) quarters which includes the month of August, then the average EBITDA for the months in the calculation period other than August will be substituted for the August EBITDA.
“EDR” means Education Realty Operating Partnership, LP, a Delaware limited partnership.
“Effective Date” means the date on which the conditions specified in Section 4.01 are satisfied (or waived in accordance with Section 9.02).
“Eligible Off Campus Ground Lease” shall mean a lease with respect to Real Property (or a portion thereof) not owned by a university, college or other educational entity entered into by Borrower or a Subsidiary meeting the following requirements: (a) a remaining term (including renewal options exercisable at lessee’s sole option) of at least thirty (30) years, (b) may be transferred and/or assigned by lessee without landlord’s consent and (c) the Administrative Agent has determined that the ground lease is financeable in that it contains customary lender protection provisions and provides or allows for, without further consent from the landlord, (i) notice and right
to cure to lessee’s lender, (ii) a pledge and mortgage of the leasehold interest, (iii) recognition of a foreclosure of the leasehold interest including no prohibition on entering into a new lease with the lender, and (iv) no right of landlord to terminate the lease without consent of lessee’s lender.
“Eligible Property Lease” shall mean a lease with respect to Real Property (or a portion thereof) owned by a university, college or other educational entity entered into by Borrower or a Subsidiary which does not constitute an Eligible Off Campus Ground Lease and is acceptable to the Administrative Agent in its reasonable discretion, such acceptance not to be unreasonably withheld, conditioned or delayed.
“Environmental Claim” means any notice of violation, action, claim, Environmental Lien, demand, abatement or other order or direction (conditional or otherwise) by any Governmental Authority or any other Person for personal injury (including sickness, disease or death), tangible or intangible property damage, damage to the environment, nuisance, pollution, contamination or other adverse effects on the environment, or for fines, penalties or restriction, resulting from or based upon (i) the existence, or the continuation of the existence, of a Release (including, without limitation, sudden or non-sudden accidental or non-accidental Releases) of, or exposure to, any Hazardous Material, or other Release in, into or onto the environment (including, without limitation, the air, soil, surface water or groundwater) at, in, by, from or related to any property owned, operated or leased by the Borrower or any of its Subsidiaries or any activities or operations thereof; (ii) the environmental aspects of the transportation, storage, treatment or disposal of Hazardous Materials in connection with any property owned, operated or leased by the Borrower or any of its Subsidiaries or their operations or facilities; or (iii) the violation, or alleged violation, of any Environmental Laws or Environmental Permits of or from any Governmental Authority relating to environmental matters connected with any property owned, leased or operated by the Borrower or any of its Subsidiaries.
“Environmental Laws” means all applicable laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the management, release or threatened release of any Hazardous Material or to health and safety matters and includes (without limitation) the Comprehensive Environmental Response, Compensation, and Liability Act (“CERCLA”), 42 U.S.C. § 9601 et seq., the Hazardous Materials Transportation Act, 49 U.S.C. § 1801 et seq., the Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. § 136 et seq., the Resource Conservation and Recovery Act (“RCRA”), 42 U.S.C. § 6901 et seq., the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq., the Clean Air Act, 42 U.S.C. §7401 et seq., the Clean Water Act, 33 U.S.C. § 1251 et seq., the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq., (to the extent the same relates to any Hazardous Materials), and the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq., as such laws have been amended or supplemented, and the regulations promulgated pursuant thereto, and all analogous state and local statutes.
“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Subsidiary directly or indirectly resulting from or based upon (a) violation of any
Environmental Law, (b) exposure to any Hazardous Materials in violation of any Environmental Law, (c) the Release or threatened Release of any Hazardous Materials into the environment in violation of any Environmental Law or (d) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.
“Environmental Lien” means any lien in favor of any Governmental Authority arising under any Environmental Law.
“Environmental Permit” means any permit required under any applicable Environmental Law or under any and all supporting documents associated therewith.
“Equity Percentage” means the aggregate ownership percentage of Borrower in each Unconsolidated Affiliate, which shall be calculated as the greater of (a) Borrower’s nominal capital ownership interest in the Unconsolidated Affiliate as set forth in the Unconsolidated Affiliate’s organizational documents, and (b) Borrower’s economic ownership interest in the Unconsolidated Affiliate, reflecting Borrower’s share of income and expenses of the Unconsolidated Affiliate.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
“ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.
“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30-day notice period is waived); (b) the existence with respect to any Plan of an “accumulated funding deficiency” (as defined in Section 412 of the Code or Section 302 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(d) of the Code or Section 303(d) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA.
“Eurodollar,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted LIBO Rate.
“Event of Default” has the meaning assigned to such term in Article VII.
“Excluded FATCA Tax” means any tax, assessment or other governmental charge imposed under FATCA that would not have been imposed but for a failure by a Lender or a Participant (or any financial institution through which any payment is made to such Lender or Participant) to comply with Section 2.16.
“Excluded Hedging Obligation” means, with respect to any Borrower, any Hedging Obligation of Borrower or another Credit Party (or any Affiliate thereof) as to which such Credit Party is jointly and severally or otherwise liable pursuant to the terms of this Agreement or any other Loan Document if, and to the extent that, the incurrence of Obligations by the Credit Party in respect of such Hedging Obligation, or the grant under a Loan Document by the Credit Party of a security interest to secure such Hedging Obligation (or any guaranty thereof), is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation thereof) by virtue of such Credit Party’s (or such Affiliate’s) failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to Section 9.06(j) and any other “keepwell, support or other agreement for the benefit of such Credit Party and any and all guarantees of, or other credit support for, Hedging Obligations provided by Borrower or any Affiliate thereof) at the time such Credit Party becomes jointly and severally or otherwise liable with respect to such Hedging Obligation or grants a security interest to secure same. If a Hedging Obligation arises under a master agreement governing more than one Hedging Agreement, such exclusion shall apply only to the portion of such Hedging Obligation that is attributable to Hedging Agreements for which such Obligations or security interest becomes illegal.
“Excluded Taxes” means, with respect to the Administrative Agent, any Lender or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) its net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the Borrower is located and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 2.19(b)), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office) or is attributable to such Foreign Lender's failure to comply with Section 2.16(e), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 2.16(a).
“FATCA” means Sections 1471 through 1474 of the Code (as of the date hereof) and any regulations or official interpretations thereof (including any Revenue Ruling, Revenue Procedure, Notice or similar guidance issued by the U.S. Internal Revenue Service thereunder as a precondition to relief or exemption from Taxes under such provisions); provided that FATCA shall also include any amendments to Sections 1471 through 1474 of the Code and any regulations or official interpretations thereof if, as amended, FATCA provides a commercially reasonable mechanism to
avoid the tax imposed thereunder by satisfying the information reporting and other requirements of FATCA.
“Federal Funds Effective Rate” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next 1/100 of 1%) of the quotations for such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.
“Financial Officer” means the chief financial officer, the chief accounting officer or treasurer of the Borrower.
"Fitch" means Fitch, Inc., and its successors.
“Fixed Charge Coverage Ratio” shall mean the ratio of (a) the Adjusted EBITDA of the Consolidated Group for the immediately preceding four (4) calendar quarters; to (b) all of the principal due and payable (excluding principal due at maturity) and principal paid on the Indebtedness (including scheduled payments on Capital Lease Obligations) of the Consolidated Group, plus the Interest Expense of the Consolidated Group, plus the aggregate of all cash dividends payable on the preferred stock of the Parent or any of its Subsidiaries, in each case for the period used to calculate Adjusted EBITDA, all of the foregoing calculated without duplication.
“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than that in which the Borrower is organized. For purposes of this definition, the United States of America, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.
“Funds From Operations” shall mean net income of the Borrower determined in accordance with GAAP, plus depreciation and amortization, revenues on participating projects which are deferred for GAAP purposes, excluding the impact of straight line accounting treatment on rents and leasehold rent expense, transaction cost related to acquisitions, severance costs and other non cash items; plus or minus any gain or loss from debt restructuring, impairments, or sales of property and, as approved by the Administrative Agent, such approval not to be unreasonably withheld, any extraordinary, non-recurring expenses associated with any financing, merger, acquisition, divestiture, or other capital transaction. Funds From Operations will be calculated for the four (4) calendar quarters immediately preceding the date of the calculation. Funds From Operations shall be calculated on a consolidated basis, and including (without duplication) the Equity Percentage of Funds From Operations for the Borrower’s Unconsolidated Affiliates.
“GAAP” means generally accepted accounting principles in the United States of America, subject to the provisions of Section 1.04.
“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority,
instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
“Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation; provided, that the term Guarantee shall not include endorsements for collection or deposit in the ordinary course of business.
“Guarantor” means the Parent.
“Guaranty” means a guaranty in the form of Exhibit C attached hereto.
“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances or wastes, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law; provided, that Hazardous Materials shall not include any such substances or wastes utilized or maintained at the Real Property in the ordinary course of business and in accordance with all applicable Environmental Laws.
“Hedging Agreement” means any interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement.
“Hedging Obligation” means any obligation to pay or perform under any Hedging Agreement, or any other agreement, contract or transaction entered into in connection therewith, with Agent or any Lender (or any Affiliate of Agent or any Lender), as counterparty, in connection with the Loan.
“Historical Value” shall mean the purchase price of Real Property (including improvements) and ordinary related purchase transaction costs, plus the cost of subsequent capital improvements (including construction costs for property under construction or development) made by the Borrower, less any provision for losses, all determined in accordance with GAAP. If the Real Property is purchased as a part of a group of properties, the Historical Value shall be calculated based upon a pro rata allocation of the aggregate purchase price by the Borrower based on net operating income of such property, and consistent with GAAP. Historical Value shall include the Equity Percentage of Historical Value for the Borrower’s Unconsolidated Affiliates.
“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money or with respect to deposits or advances of any kind, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person, (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty, (j) all obligations, contingent or otherwise, of such Person in respect of bankers' acceptances, (k) all obligations contingent or otherwise, of such Person with respect to any Hedging Agreements (calculated on a mark-to-market basis as of the reporting date), and (l) payments received in consideration of sale of an ownership interest in Borrower when the interest so sold is determined, and the date of delivery is, more than one (1) month after receipt of such payment and only to the extent that the obligation to deliver such interest is not payable solely in such interest of such Person. The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person's ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor. Indebtedness shall be calculated on a consolidated basis in accordance with GAAP, and including (without duplication) the Equity Percentage of Indebtedness for the Borrower’s Unconsolidated Affiliates.
“Indemnified Taxes” means Taxes other than Excluded Taxes and Excluded FATCA Tax.
“Interest Rate Election” means a request by the Borrower to borrow, convert or continue a Term Borrowing in accordance with Section 2.07.
“Interest Expense” shall mean all of a Person's paid, accrued or capitalized interest expense on such Person's Indebtedness (whether direct, indirect or contingent, and including, without limitation, interest on all convertible debt), and including (without duplication) the Equity Percentage of Interest Expense for the Borrower’s Unconsolidated Affiliates.
“Interest Payment Date” means the first Business Day of each calendar month.
“Interest Period” means with respect to any Eurodollar Borrowing, (i) initially, the period beginning on (and including) the date of such Borrowing on the Effective Date and ending on (but excluding) February 1, 2014 (the “Stub Period”); and (ii) thereafter, each period commencing on (and including) the last day of the Stub Period and ending on the numerically corresponding day in the calendar month that is one, two or three months thereafter, or less than one month if available to all Lenders; provided, that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless, in the case of a Eurodollar Borrowing only, such next succeeding Business Day would fall in the next calendar
month, in which case such Interest Period shall end on the next preceding Business Day; (b) any Interest Period pertaining to a Eurodollar Borrowing that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period; and (c) if the Borrower has or may incur any obligations to Agent or any Lender (or any Affiliate of Agent or any Lender) as the counterparty under any Hedging Agreement, the Interest Period shall be of the same duration as the relevant period set under any such applicable Hedging Agreement. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and, in the case of a Term Borrowing, thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
“Investment Grade Rating” means a Debt Rating of BBB- or better from Standard & Poor’s or Fitch, or Baa3 or better from Moody’s.
“Legal Requirement” means any law, statute, ordinance, decree, requirement, order, judgment, rule, regulation (or interpretation of any of the foregoing) of, and the terms of any license or permit issued by, any Governmental Authority.
“Lenders” means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Assignment and Acceptance, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Acceptance.
“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, the interest rate which appears on the Bloomberg Page BBAM1 (or on such other substitute Bloomberg page that displays rates at which US dollar deposits are offered by leading banks in the London interbank deposit market), or the rate which is quoted by another source selected by the Administrative Agent from time to time which has been approved by the British Bankers' Association (or any successor thereto) as an authorized information vendor for the purpose of displaying rates at which US dollar deposits are offered by leading banks in the London interbank deposit market (an "Alternate Source"), at approximately 11:00 a.m., London time, two (2) Business Days prior to the commencement of such Interest Period as the London interbank offered rate for U.S. Dollars for an amount having a borrowing date and a maturity comparable to such Interest Period (or if there shall at any time, for any reason, no longer exist a Bloomberg Page BBAM1 (or any substitute page) or any Alternate Source, a comparable replacement rate determined by the Administrative Agent at such time (which determination shall be conclusive absent manifest error)). In the event that such rate is not available at such time for any reason, then the “LIBO Rate” with respect to such Eurodollar Borrowing for such Interest Period shall be the rate (rounded upwards, if necessary, to the next 1/100 of 1%) at which dollar deposits of $5,000,000 and for a maturity comparable to such Interest Period are offered by the principal London office of the Administrative Agent in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period.
“Lien” means, with respect to an asset, (a) any mortgage, deed of trust, lien (statutory or other), pledge, hypothecation, negative pledge, collateral assignment, encumbrance, deposit arrangement, charge or security interest in, on or of such asset; (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the foregoing) relating to such asset; (c) the filing under the Uniform Commercial Code or comparable law of any jurisdiction of any financing statement naming the owner of the asset to which such Lien relates as debtor; (d) any other preferential arrangement of any kind or nature whatsoever intended to assure payment of any Indebtedness or other obligation; and (e) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.
“Loan Documents” means this Agreement, the Notes, the Guaranty and all other instruments, agreements and written obligations executed and delivered by any of the Credit Parties in connection with the transactions contemplated hereby.
“Loan” or “Loans” means the term loans made by the Lenders to the Borrower pursuant to this Agreement.
“Majority Lenders” means, as of any date of determination, Lenders holding in the aggregate in excess of 50% of the aggregate Loans; provided that the Commitment of, and the portion of the Loans held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Majority Lenders; provided further that at all times when two or more Lenders are party to this Agreement, the term “Majority Lenders” shall in no event mean less than two Lenders unless only two Lenders are party to this Agreement and one of such Lenders is a Defaulting Lender.
“Management Company” means the manager of the Real Property owned by EDR or a Subsidiary of EDR.
“Material Adverse Effect” means a material adverse effect on (a) the business, assets, operations, or condition, financial or otherwise, of (i) the Borrower and its Subsidiaries, other than owners of Real Property in the Unencumbered Pool, and the Guarantor, taken as a whole, or (ii) any owner of Real Property in the Unencumbered Pool, (b) the ability of any of the Credit Parties to perform their obligations under the Loan Documents or (c) the rights of or benefits available to the Administrative Agent or the Lenders under the Loan Documents.
“Material Contract” means any contract or other arrangement (other than Loan Documents and any Hedging Agreements), whether written or oral, to which any Credit Party is a party as to which the breach, nonperformance, cancellation or failure to renew by any party thereto could reasonably be expected to have a Material Adverse Effect.
“Material Indebtedness” means Indebtedness (other than the Loans), or obligations in respect of one or more Hedging Agreements, of the Borrower, the other Credit Parties, or any Property Subsidiary in an aggregate principal amount exceeding $10,000,000.
“Maturity Date” means as applicable, each of the Tranche A Maturity Date and/or the Tranche B Maturity Date.
“Maximum Loan Available Amount” means, on any date, an amount equal to the aggregate Commitments.
“Maximum Rate” shall have the meaning set forth in Section 9.13.
“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto or assignee of the business of such company in the business of rating debt.
“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“Net Operating Income” shall mean, for any income producing operating Real Property, the difference between (a) any rentals, proceeds and other income received from such property, including early lease termination penalties to the extent no new tenant is in place and allocated over the applicable remaining term (but excluding (i) security or other deposits, and (ii) other income of a non-recurring nature) during the determination period, less (b) an amount equal to all costs and expenses (excluding Interest Expense, non-cash straight line ground rent as determined in accordance with GAAP, any expenditures that are capitalized in accordance with GAAP, non-cash expenses such as depreciation and amortization, and as approved by the Administrative Agent, such approval not to be unreasonably withheld, any extraordinary, non-recurring expenses associated with any financing, merger, acquisition, divestiture, or other capital transaction) incurred as a result of, or in connection with, or properly allocated to, the operation or leasing of such property during the determination period; provided, however, that the amount for the expenses for the management of a property included in clause (b) above shall be set at three percent (3%) of (I) the amount provided in clause (a) above, less (II) a bad debt allowance. Net Operating Income shall be calculated based on the immediately preceding four (4) calendar quarters unless the Real Property has not been owned by the Borrower or its Subsidiaries for four (4) calendar quarters, in which event (i) Net Operating Income shall be calculated for the period of ownership, and annualized, and (ii) if the period of ownership includes the month of August, the Net Operating Income for August will be disregarded in the annualization calculation. Net Operating Income shall be calculated on a consolidated basis in accordance with GAAP, and including (without duplication) the Equity Percentage of Net Operating Income for the Borrower’s Unconsolidated Affiliates.
“Non-Qualified ECP Credit Party” means any Credit Party that is not then an “eligible contract participant” under the Commodity Exchange Act (determined prior to giving effect to Section 9.06(j)).
“Note” means a promissory note in the form attached hereto as Exhibit D payable to a Lender evidencing certain of the obligations of the Borrower to such Lender and executed by Borrower, as the same may be amended, supplemented, modified or restated from time to time; “Notes” means, collectively, all of such Notes outstanding at any given time.
“Obligations” means, individually and collectively: (a) the aggregate principal balance of, and all accrued and unpaid interest on, all Loans; and (b) all other indebtedness, liabilities, obligations, covenants and duties of the Borrower owing to the Administrative Agent or any Lender of every kind, nature and description, under or in respect of this Agreement or any of the other Loan Documents, including, without limitation, any fees and indemnification obligations, whether direct or indirect, absolute or contingent, due or not due, contractual or tortious, liquidated or unliquidated,
and whether or not evidenced by any promissory note, including any Hedging Obligations; provided, however, that in no event shall Obligations include any Excluded Hedging Obligations.
"OFAC” means the U.S. Department of the Treasury's Office of Foreign Assets Control, and any successor thereto.
“Other Taxes” means any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement, and not including the Excluded Taxes or the Excluded FATCA Taxes.
“Parent” means Education Realty Trust, Inc., a Maryland corporation and the parent of EDR.
“Participant” has the meaning given that term in Section 9.04(c).
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
“Permitted Encumbrances” means:
(a) Liens imposed by law for taxes that are not yet due or are being contested in compliance with Section 5.05;
(b) pledges and deposits made in the ordinary course of business in compliance with workers' compensation, unemployment insurance and other social security laws or regulations;
(c) deposits to secure the performance of bids, trade contracts, purchase, construction or sales contracts, leases, statutory obligations, surety and appeal bonds, performance bonds and other obligations of a like nature, in each case in the ordinary course of business;
(d) the Title Instruments and Liens which do not secure Indebtedness and other customary matters;
(e) uniform commercial code protective filings with respect to personal property leased to the Borrower or any Subsidiary; and
(f) landlords’ liens for rent not yet due and payable;
provided that the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness.
“Permitted Investments” means:
(a) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent
such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of acquisition thereof;
(b) investments in commercial paper maturing within 270 days from the date of acquisition thereof and having an investment grade credit rating on the date of acquisition;
(c) investments in certificates of deposit, banker's acceptances and time deposits maturing within 180 days from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof which has a combined capital and surplus and undivided profits of not less than $500,000,000;
(d) fully collateralized repurchase agreements with a term of not more than 90 days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria described in clause (c) above; and
(e) investments in Subsidiaries and Unconsolidated Affiliates made in accordance with this Agreement.
“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
“Plan” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“PNC” means PNC Bank, National Association, in its individual capacity.
“Prepayment Premium” means a premium payable pro rata to the Tranche A Lenders equal to the following amount for the following periods:
|
| |
If Prepayment of Tranche A occurs | Prepayment Fee |
On or before January 13, 2015 | 3% of the principal amount of Tranche A Loans prepaid. |
After January 13, 2015 but on or before January 13, 2016 | 2% of the principal amount of Tranche A Loans prepaid. |
After the January 13, 2016 but on or before January 13, 2017 | 1% of the principal amount of Tranche A Loans prepaid. |
After January 13, 2017 | 0 |
“Prime Rate” means the rate of interest per annum publicly announced from time to time by PNC Bank, National Association, as its prime rate in effect at its principal office in Pittsburgh, Pennsylvania; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.
“Property Subsidiary” means each Subsidiary of the Borrower that owns an Acceptable Unencumbered Property in the Unencumbered Pool.
“Qualified ECP Credit Party” means, at any time, each Credit Party with total assets exceeding $10,000,000 or that qualifies at such time as an “eligible contract participant” under the Commodity Exchange Act and can cause another Person to qualify as an “eligible contract participant” at such time under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.
“Real Property” means, collectively, all interest in any land and improvements located thereon (including direct financing leases of land and improvements owned by a Person), together with all equipment, furniture, materials, supplies and personal property now or hereafter located at or used in connection with the land and all appurtenances, additions, improvements, renewals, substitutions and replacements thereof now or hereafter acquired by any Person.
“Register” has the meaning set forth in Section 9.04.
“Related Parties” means, with respect to any specified Person, such Person's Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person's Affiliates.
“Release” means any release, spill, emission, leaking, pumping, pouring, dumping, emptying, injection, deposit, disposal, discharge, dispersal, leaching or migration on or into the indoor or outdoor environment or into or out of any property.
“Remedial Action” means all actions, including without limitation any capital expenditures, required or necessary to (i) clean up, remove, treat or in any other way address any Hazardous Material; (ii) prevent the Release or threat of Release, or minimize the further Release, of any Hazardous Material so it does not migrate or endanger public health or the environment; (iii) perform pre-remedial studies and investigations or post-remedial monitoring and care; or (iv) bring facilities on any property owned or leased by the Borrower or any of its Subsidiaries into compliance with all Environmental Laws.
“Required Lenders” means, as of any date of determination, Lenders holding in the aggregate in excess of 66 and 2/3% of the aggregate Loans; provided that the portion of the Loans held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders; provided further that at all times when two or more Lenders are party to this Agreement, the term “Required Lenders” shall in no event mean less than two Lenders unless only two Lenders are party to this Agreement and one of such Lenders is a Defaulting Lender.
“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any ownership interests in the Borrower, or any payment (whether
in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such ownership interests in the Borrower or any option, warrant or other right to acquire any such shares of capital stock of the Borrower.
“Revolving Facility” means, that certain Fifth Amended and Restated Credit Agreement dated November 19, 2014 entered into between KeyBank National Association, as administrative agent, the various lenders party thereto, and the Borrower, as may be amended from time to time.
“Revolving Facility Amount” means, from time to time, the aggregate amounts outstanding under the Revolving Facility.
“S&P” means Standard & Poor’s Financial Services LLC, a subsidiary of The McGraw‑Hill Companies, Inc., or any successor or assignee of the business of such division in the business of rating debt.
"Sanctioned Country” means, at any time, any country or territory which is itself the subject or target of any comprehensive Sanctions.
"Sanctioned Person” means, at any time, (a) any Person or group listed in any Sanctions-related list of designated Persons maintained by OFAC or the U.S. Department of State, the United Nations Security Council, the European Union or any EU Member State, (b) any Person or group operating, organized or resident in a Sanctioned Country to the extent such Person is subject to Sanctions, (c) any agency, political subdivision or instrumentality of the government of a Sanctioned Country, or (d) any Person 50% or more owned, directly or indirectly, by any of the above.
"Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State or (b) the United Nations Security Council, the European Union or Her Majesty's Treasury of the United Kingdom.
“Secured Debt” means all Indebtedness, whether on a recourse or a non-recourse basis, which is secured by a Lien on any asset of any Person.
“Secured Recourse Debt” means all Secured Debt of any Person on a recourse basis.
“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Governmental Authority to which the Administrative Agent is subject, with respect to the Adjusted LIBO Rate, for Eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurodollar Loans shall be deemed to constitute Eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
“Subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent's consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent. EDR is a Subsidiary of the Parent.
“Tangible Net Worth” shall mean total assets (without deduction for accumulated depreciation) less (1) all intangibles and (2) all liabilities (including contingent and indirect liabilities), all determined in accordance with GAAP. The term "intangibles" shall include, without limitation, (i) deferred charges, and (ii) the aggregate of all amounts appearing on the assets side of any such balance sheet for franchises, licenses, permits, patents, patent applications, copyrights, trademarks, trade names, goodwill, treasury stock, experimental or organizational expenses and other like intangibles. The term "liabilities" shall include, without limitation, (i) Indebtedness secured by Liens on Property of the Person with respect to which Tangible Net Worth is being computed whether or not such Person is liable for the payment thereof, (ii) deferred liabilities, and (iii) Capital Lease Obligations. Tangible Net Worth shall be calculated on a consolidated basis in accordance with GAAP.
“Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority.
“Term Credit Exposure” means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender's Term Loans at such time.
“Term Loan(s)” means individually and/or collectively, as the context so requires, the Tranche A Loans and Tranche B Loans.
“Title Instruments” means all instruments of record in the Office of the County Clerk, the Real Property Records or of any other Governmental Authority affecting title to all or any part of the Real Property in the Unencumbered Pool, including but not limited to those (if any) which impose restrictive covenants, easements, rights-of-way or other encumbrances on all or any part of the Real Property in the Unencumbered Pool.
“Total Asset Value” means the sum of (without duplication) (a) the aggregate Value of all of Borrower’s and its Subsidiaries’ Real Property and other assets as set forth in the definition of Value, plus (b) the amount of any cash and cash equivalents, excluding tenant security and other restricted deposits of the Borrower and its Subsidiaries. Total Asset Value shall be calculated on a
consolidated (inclusive of the Equity Percentage in Unconsolidated Affiliates and unconsolidated joint ventures) basis in accordance with GAAP.
“Total Leverage Ratio” shall mean the ratio (expressed as a percentage) of (a) the Indebtedness of the Consolidated Group to (b) Total Asset Value.
“Total Secured Debt Ratio” shall mean the ratio (expressed as a percentage) of (a) the Secured Debt of the Consolidated Group to (b) Total Asset Value.
“Total Unsecured Debt to Unencumbered Asset Value Ratio” shall mean the ratio (expressed as a percentage) of (a) the Unsecured Debt of the Consolidated Group to (b) Unencumbered Asset Value.
“Tranche A Applicable Percentage” means, with respect to any Tranche A Lender, expressed as a percentage, of (a) the aggregate outstanding principal amount of such Tranche A Lender’s Tranche A Loans to (b) the aggregate outstanding principal amount of all Tranche A Loans; provided, however, that if at the time of determination all Tranche A Loans have been paid in full, the “Tranche A Applicable Percentage” of each Tranche A Lender shall be the Tranche A Applicable Percentage of such Tranche A Lender in effect immediately prior to such payment in full.
“Tranche A Commitment” shall mean the commitment of each Tranche A Lender to advance or hold Tranche A Loans hereunder. The initial aggregate amount of the Tranche A Commitments is $122,500,000.00.
“Tranche A Lender” shall mean each Lender that issues a Tranche A Commitment and/or holds Tranche A Loans hereunder.
“Tranche A Loans” shall mean the loans made by the Tranche A Lenders pursuant to Section 2.01.
“Tranche A Maturity Date” means January 13, 2021.
“Tranche A Required Lenders” means, as of any date of determination, Tranche A Lenders holding in the aggregate in excess of 66 and 2/3% of the aggregate Tranche A Loans; provided that the portion of the Tranche A Loans held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of the Tranche A Required Lenders; provided further that at all times when two or more Tranche A Lenders are party to this Agreement, the term “Tranche A Required Lenders” shall in no event mean less than two Tranche A Lenders unless only two Tranche A Lenders are party to this Agreement and one of such Tranche A Lenders is a Defaulting Lender.
“Tranche B Applicable Percentage” means, with respect to any Tranche B Lender, expressed as a percentage, of (a) the aggregate outstanding principal amount of such Tranche B Lender’s Tranche B Loans to (b) the aggregate outstanding principal amount of all Tranche B Loans; provided, however, that if at the time of determination all Tranche B Loans have been paid in full, the “Tranche
B Applicable Percentage” of each Tranche B Lender shall be the Tranche B Applicable Percentage of such Tranche B Lender in effect immediately prior to such payment in full.
“Tranche B Commitment” shall mean the commitment of each Tranche B Lender to advance or hold Tranche B Loans hereunder. The initial aggregate amount of the Tranche B Commitments is $65,000,000.00.
“Tranche B Lender” shall mean each Lender that issues a Tranche B Commitment and/or holds Tranche B Loans hereunder.
“Tranche B Loans” shall mean the loans made by the Tranche B Lenders pursuant to Section 2.01.
“Tranche B Maturity Date” means January 13, 2019.
“Tranche B Required Lenders” means, as of any date of determination, Tranche B Lenders holding in the aggregate in excess of 66 and 2/3% of the aggregate Tranche B Loans; provided that the portion of the Tranche B Loans held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of the Tranche B Required Lenders; provided further that at all times when two or more Tranche B Lenders are party to this Agreement, the term “Tranche B Required Lenders” shall in no event mean less than two Tranche B Lenders unless only two Tranche B Lenders are party to this Agreement and one of such Tranche B Lenders is a Defaulting Lender.
“Transactions” means the execution, delivery and performance by the Credit Parties of the Loan Documents, the borrowing of Loans, and the use of the proceeds thereof.
“Type,” when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.
“Unconsolidated Affiliate” means, without duplication, in respect of any Person, any other Person (other than a Person whose stock is traded on a national trading exchange) in whom such Person holds a voting equity or ownership interest and whose financial results would not be consolidated under GAAP with the financial results of such Person on the consolidated financial statements of such Person.
“Unencumbered Asset Value” means the sum of the aggregate Value of the Acceptable Unencumbered Properties, provided that the aggregate Value of Acceptable Unencumbered Properties of Subsidiaries that are not wholly-owned (directly or indirectly) by the Borrower shall not exceed fifteen percent (15%) of the total Unencumbered Asset Value.
“Unencumbered NOI” means, Net Operating Income for the prior four fiscal quarters from Acceptable Unencumbered Properties included in the Unencumbered Pool.
“Unencumbered Pool” has the meaning set forth in Section 5.12.
“Unsecured Debt” means all Indebtedness of any Person which is not Secured Debt.
“Unsecured Interest Expense” means the actual interest expense on account of all Unsecured Debt (including the Revolving Credit Exposure) of the Consolidated Group for the most recently ended four (4) quarters.
“Unsecured Interest Coverage Ratio” shall mean the ratio of (i) Adjusted Unencumbered NOI for the most recently ended four (4) quarters to (b) Unsecured Interest Expense.
“Value” means the sum of the following:
(a) for Real Property that has been owned by the Borrower, its Subsidiary or an Unconsolidated Affiliate for twelve (12) months or longer, the Net Operating Income for the most recently ended four fiscal (4) quarters for such Real Property, and then divided by six and one-half percent (6.50%); plus
(b) for Real Property that was acquired by the Borrower, its Subsidiary or an Unconsolidated Affiliate less than twelve (12) months prior to the date of calculation, the Historical Value of such Real Property; plus
(c) for Real Property that is an Asset Under Development or undeveloped land, the Historical Value of the subject property; plus
(d) for Real Property that was an Asset Under Development but has been open and operating for less than twelve (12) months, the Historical Value of such Real Property or, at the Borrower’s election (which election shall be irrevocable with respect to such Real Property once made until such time as such Real Property has been open and operated by the Borrower for at least twelve (12) months or longer, at which time the provisions of subsection (a) above shall control), the Net Operating Income for such Real Property calculated for the period of operation instead of the period of ownership, annualized, and then divided by six and one-half percent (6.50%); plus
(e) the value of any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases under GAAP and included as Indebtedness; plus
(f) The book value of any loan receivables secured by Real Property.
“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02 Classification of Loans and Borrowings . For purposes of this Agreement, Loans may be classified and referred to by Class (e.g., a “Tranche A Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “Tranche A Eurodollar Loan”). Borrowings
also may be classified and referred to by Class (e.g., a “Term Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar Term Borrowing”).
SECTION 1.03 Terms Generally . The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes,” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall”. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person's successors and assigns, (c) the words “herein,” “hereof,” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights. All references to the Borrower shall be deemed to be references to all Persons constituting the Borrower or each of them (whichever the context requires) and the obligations of such Persons under this Agreement and the other Loan Documents shall be joint and several as they relate to the Borrower.
SECTION 1.04 Accounting Terms; GAAP . Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the date hereof in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith. All financial definitions and covenants shall be calculated on a consolidated basis, and with the impact and results for any non-wholly owned Subsidiary or Affiliate being determined by multiplying the applicable amount by the percentage of Borrower’s ownership interest in such non-wholly owned Subsidiary or Affiliate.
ARTICLE II
The Credits
SECTION 2.01 Commitments . Subject to the terms and conditions set forth herein, each Lender severally agrees to make Term Loans to the Borrower on the Effective Date in the amount of such Lender's Tranche A Commitment and/or Tranche B Commitment.
SECTION 2.02 Loans and Borrowings.
(a) Each Term Loan shall be made as part of a Borrowing consisting of Term Loans made by the Lenders ratably in accordance with their respective Commitments. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender's failure to make Loans as required.
(b) Subject to Section 2.13, each Term Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request in accordance herewith. Each Lender at its option may make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement.
(c) At the commencement of each Interest Period for any Eurodollar Term Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of $100,000 and not less than $1,000,000. At the time that each ABR Term Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of $100,000 and not less than $1,000,000, provided that an ABR Term Borrowing may be in an aggregate amount that is equal to the entire unused balance of the subject Term Loan. Borrowings of more than one Type and Class may be outstanding at the same time; provided that there shall not at any time be more than a total of four (4) Eurodollar Borrowings outstanding which are Tranche A Loans and four (4) Eurodollar Borrowings outstanding which are Tranche B Loans.
(d) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to elect to convert or continue, any Borrowing with respect to a subject Term Loan if the Interest Period requested with respect thereto would end after the applicable Maturity Date for such Term Loan.
SECTION 2.03 RESERVED.
SECTION 2.04 RESERVED.
SECTION 2.05 RESERVED.
SECTION 2.06 Funding of Borrowings.
(a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, Pittsburgh, Pennsylvania time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like funds, to an account of the Borrower.
(b) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender's share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation or (ii) in the case of the Borrower, the interest rate applicable to the corresponding Loan made to the Borrower. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender's Loan included in such Borrowing.
SECTION 2.07 Interest Elections.
(a) Each Term Borrowing initially shall be of the Type specified in the applicable Interest Rate Election and, in the case of a Eurodollar Term Borrowing, shall have an initial Interest Period as specified in such Interest Rate Election. Thereafter, the Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar Term Borrowing, may elect Interest Periods therefor, all as provided in this Section. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.
(b) To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the time that an Interest Rate Election would be required under Section 2.02 if the Borrower were requesting a Term Borrowing of the Type resulting from such election to be made on the effective date of such election. Each such telephonic Interest Rate Election shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Interest Rate Election in the form of an Interest Rate Election and signed by the Borrower.
(c) Each telephonic and written Interest Rate Election shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Rate Election applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest Rate Election, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”.
If any such Interest Rate Election requests a Eurodollar Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.
(d) Promptly following receipt of an Interest Rate Election, the Administrative Agent shall advise each Lender of the details thereof and of such Lender's portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Rate Election with respect to a Eurodollar Term Borrowing prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to a Eurodollar Borrowing with an Interest Period of one month. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Term Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Term Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.
SECTION 2.08 Increase of Commitments.
(a) So long as the Borrower is not then in Default, the Borrower may, prior to the Tranche B Maturity Date, request that the aggregate Tranche A Commitments and/or Tranche B Commitments be increased in any combination of Tranche A and/or Tranche B Borrowings, so long as (a) each increase is in a minimum amount of $10,000,000.00 and an integral multiple of $5,000,000 (or such smaller amounts as the Administrative Agent may approve), and (b) the aggregate Commitments do not exceed $250,000,000.00 (the “Maximum Commitment”). If the Borrower requests that any applicable Commitments be increased, the Administrative Agent shall use its best efforts to obtain increased or additional commitments up to the Maximum Commitment, and to do so the Administrative Agent may obtain additional lenders of its choice (and approved by Borrower, such approval not to be unreasonably withheld or delayed), and without the necessity of approval from any of the Lenders. The Borrower and each other Credit Party shall execute an amendment to this Agreement, additional Notes and other documents as the Administrative Agent may reasonably require to evidence the increase of the applicable Commitments, the addition of
new Real Property to the Unencumbered Pool, if applicable, and the admission of additional Persons as Lenders, if necessary.
SECTION 2.09 Repayment of Loans; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of each Lender the then unpaid principal amount of (i) each Tranche A Loan on the Tranche A Maturity Date, and (b) each Tranche B Loan on the Tranche B Maturity Date. At the request of each Lender, the Loans made by such Lender shall be evidenced by a Note payable to such Lender in the amount of such Lender’s Commitment.
(b) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.
(c) The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the Class and Type thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to paragraph (b) or (c) of this Section shall be prima facie evidence of the existence and amounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.
SECTION 2.10 Prepayment of Loans.
(a) The Borrower shall have the right at any time and from time to time to prepay, without penalty, any Borrowing in whole or in part, subject to prior notice in accordance with paragraph (b) of this Section, and subject to (i) Section 2.15, if applicable, and (ii) as to Tranche A Loans, subject to payment of any applicable Prepayment Premium.
(b) The Borrower shall notify the Administrative Agent by telephone (confirmed by telecopy) of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Term Borrowing, not later than 11:00 a.m., Pittsburgh, Pennsylvania time, three (3) Business Days before the date of prepayment, (ii) in the case of prepayment of an ABR Term Borrowing, not later than 11:00 a.m., Pittsburgh, Pennsylvania time, one Business Day before the date of prepayment. Each such notice shall be irrevocable and shall specify the prepayment date and the principal amount of each Borrowing or portion thereof to be prepaid. Promptly following receipt of any such notice relating to a Term Borrowing, the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Term Borrowing shall be in an amount that is an integral multiple of
$100,000 and not less than $500,000. Each prepayment of a Term Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing. Prepayments shall be accompanied by accrued interest to the extent required by Section 2.12.
(c) In connection with the prepayment of any Loan prior to the expiration of the Interest Period applicable thereto, the Borrower shall also pay any applicable expenses pursuant to Section 2.15.
(d) Amounts to be applied to the prepayment of Loans pursuant to any of the preceding subsections of this Section shall be applied, first, to reduce outstanding ABR Loans and next, to the extent of any remaining balance, to reduce outstanding Eurodollar Loans. Each such prepayment shall be applied to prepay ratably the Loans of the Lender.
(e) If at any time the total Term Credit Exposure of the Lenders exceeds the then effective Maximum Loan Available Amount, the Borrower shall prepay the Loans (such prepayment to be applied on a pro rata basis to the Tranche A Loans and the Tranche B Loans) in an amount equal to such excess within one (1) Business Day after such occurrence; provided, however, that solely with respect to any such prepayment required to be made by Borrower under this Section 2.10(e), the Borrower shall not be required to pay any Prepayment Premium with respect to the amount so prepaid which otherwise would be payable under Section 2.10(a).
SECTION 2.11 Fees.
(a) The Borrower agrees to pay to the Administrative Agent, for its own account or for the account of the Lenders, as applicable, fees payable in the amounts and at the times set forth under the Loan Documents and as separately agreed upon between the Borrower and the Administrative Agent.
(b) All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent. Fees paid shall not be refundable under any circumstances.
SECTION 2.12 Interest.
(a) Each Tranche A Loan and Tranche B Loan comprising an ABR Borrowing shall bear interest at the lesser of (x) the Alternate Base Rate plus the Applicable Rate with respect to such Tranche A Loan or Tranche B Loan, or (y) the Maximum Rate.
(b) (a) Each Tranche A Loan and Tranche B Loan comprising a Eurodollar Borrowing shall bear interest at the lesser of (a) the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Rate with respect to such Tranche A Loan or Tranche B Loan, or (b) the Maximum Rate.
(c) Notwithstanding the foregoing, (A) if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder is not paid when due, whether
at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, the lesser of (x) 4% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section, or (y) the Maximum Rate, or (ii) in the case of any other amount, the lesser of (x) 4% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section, or (y) the Maximum Rate; and (B) after the occurrence of any Event of Default, at the option of the Administrative Agent, or if the Administrative Agent is directed in writing by the Required Lenders to do so, the Loan shall bear interest at a rate per annum equal to the lesser of (x) 4% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section, or (y) the Maximum Rate.
(d) Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Term Loan prior to the end of the applicable Maturity Date), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Term Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a year of 360 days and twelve (12) 30-day months, and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate, Adjusted LIBO Rate or LIBO Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.
SECTION 2.13 Alternate Rate of Interest . If prior to the commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period; or
(b) the Administrative Agent is advised by the Required Lenders that (i) the Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for such Interest Period and (ii) such fact is generally applicable to its loans of this type to similar borrowers, as evidenced by a certification from such Lenders;
then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, any Interest Rate Election that requests the conversion of any Term Borrowing to, or continuation of
any Term Borrowing as, a Eurodollar Borrowing shall be ineffective; provided that if the circumstances giving rise to such notice affect only one Type of Borrowings, then the other Type of Borrowings shall be permitted.
SECTION 2.14 Increased Costs.
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate); or
(ii) impose on any Lender or the London interbank market any other condition (other than one relating to Excluded Taxes) affecting this Agreement or Eurodollar Loans made by such Lender;
and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan) or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of principal, interest or otherwise), then the Borrower will pay to such Lender such additional amount or amounts as will compensate such Lender for such additional costs incurred or reduction suffered.
(b) If any Lender determines that any Change in Law regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender's capital or on the capital of such Lender's holding company, if any, as a consequence of this Agreement or the Loans made by such Lender, to a level below that which such Lender or such Lender's holding company could have achieved but for such Change in Law (taking into consideration such Lender's policies and the policies of such Lender's holding company with respect to capital adequacy), then from time to time the Borrower will pay to such Lender, as the case may be, such additional amount or amounts as will compensate such Lender or such Lender's holding company for any such reduction suffered.
(c) A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender's right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender pursuant to this Section for any increased costs or reductions incurred more than 270 days prior to the date that such Lender notifies the Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender's intention to claim compensation therefor; provided further that, if the Change in Law giving rise to such increased costs or
reductions is retroactive, then the 270-day period referred to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.15 Break Funding Payments . In the event of (a) the payment of any principal of any Eurodollar Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to convert, continue or prepay any Term Loan on the date specified in any notice delivered pursuant hereto (regardless of whether such notice may be revoked under Section 2.10(b)), or (d) the assignment of any Eurodollar Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to Section 2.19, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBO Rate that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the Eurodollar market. A certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.
SECTION 2.16 Taxes.
(a) Any and all payments by or on account of any obligation of the Borrower hereunder shall be made free and clear of and without deduction for any Indemnified Taxes or Other Taxes; provided that if the Borrower shall be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section) the Administrative Agent, Lender receives an amount equal to the sum it would have received had no such deductions been made, (ii) the Borrower shall make such deductions and (iii) the Borrower shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.
(c) The Borrower shall indemnify the Administrative Agent and each Lender, within 10 days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid by the Administrative Agent or such Lender on or with respect to any payment by or on account of any obligation of the Borrower hereunder (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable
under this Section) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Lender, or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
(e) Any Foreign Lender that is entitled to an exemption from or reduction of withholding tax under the law of the jurisdiction in which the Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law, such properly completed and executed documentation prescribed by applicable law or reasonably requested by the Borrower as will permit such payments to be made without withholding or at a reduced rate.
(f) Without limiting any other provision of this Agreement, if a payment made to a Lender or a Participant under any Loan Document would be subject to United States federal withholding Tax imposed by FATCA if such Lender or Participant were to fail to comply with any requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender or Participant shall (A) enter into such agreements with the Internal Revenue Service as necessary to establish an exemption from withholding under FATCA; (B) comply with any certification, documentation, information, reporting or other requirement necessary to establish an exemption from withholding under FATCA; (C) provide any documentation reasonably requested by the Borrower or the Administrative Agent sufficient for the Administrative Agent and the Borrower to comply with their respective obligations, if any, under FATCA and to determine that such Lender has complied such applicable requirements; and (D) provide a certification signed by the chief financial officer, principal accounting officer, treasurer or controller of such Lender certifying that such Lender or Participant has complied with any necessary requirements to establish an exemption from withholding under FATCA. To the extent that the relevant documentation provided pursuant to this paragraph is rendered obsolete or inaccurate in any material respect as a result of changes in circumstances with respect to the status of a Lender or Participant, such Lender or Participant shall, to the extent permitted by any Legal Requirement, deliver to the Borrower and the Administrative Agent revised and/or updated documentation sufficient for the Borrower and the Administrative Agent to confirm such Lender’s or such Participant’s compliance with its obligations under FATCA.
SECTION 2.17 Payments Generally; Pro Rata Treatment; Sharing of Set-offs.
(a) The Borrower shall make each payment required to be made by it hereunder (whether of principal, interest, fees, or amounts payable under Section 2.14, 2.15 or 2.16, or otherwise) prior to 1:00 p.m., Pittsburgh, Pennsylvania time, on the date when due, in immediately available funds, without set-off or counterclaim. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at its offices at Three PNC Plaza, 225 Fifth Avenue, 5th Floor, Pittsburgh, Pennsylvania 15222-2724, and except that payments pursuant to Sections 2.14, 2.15, 2.16 and 9.03 shall be made directly to the Persons entitled thereto. If the Administrative Agent receives a payment for the account of a Lender prior to 1:00 p.m., Pittsburgh, Pennsylvania time, such payment must be delivered to the Lender on the same day and if it is not so delivered due to the fault of the Administrative Agent, the Administrative Agent shall pay to the Lender entitled to the payment interest thereon for each day after payment should have been received by the Lender pursuant hereto until the Lender receives payment, at the Federal Funds Effective Rate. If any payment hereunder shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments hereunder shall be made in Dollars.
(b) If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and fees then due hereunder, such funds shall be applied (i) first, towards payment of interest and fees then due under the Obligations, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal or any other Obligation then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal or other Obligation then due to such parties.
(c) If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Term Loans resulting in such Lender receiving payment of a greater proportion of the aggregate amount of its Term Loans and accrued interest thereon than the proportion received by any other Lender, then the Lender receiving such greater proportion shall purchase (for cash at face value) participations in the Term Loans of other Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Term Loans; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans
to any assignee or participant, other than to the Borrower or any Subsidiary or Affiliate thereof (as to which the provisions of this paragraph shall apply). The Borrower consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Borrower rights of set-off and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Borrower in the amount of such participation.
(d) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the Federal Funds Effective Rate.
(e) If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.05(d) or (e), 2.06(b) or 2.17(d), then the Administrative Agent may, in its discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter received by the Administrative Agent for the account of such Lender to satisfy such Lender's obligations under such Sections until all such unsatisfied obligations are fully paid.
SECTION 2.18 Defaulting Lenders .
(a) Adjustments. Notwithstanding anything to the contrary contained in this Credit Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:
(i) Waivers and Amendments. That Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Credit Agreement shall be restricted as set forth in Section 9.02.
(ii) Reallocation of Payments. Any payment of principal, interest, fees or other amounts received by Administrative Agent for the account of a Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Section VII or otherwise, and including any amounts made available to Administrative Agent by that Defaulting Lender pursuant to Section 9.08), shall be applied at such time or times as may be determined by Administrative Agent as follows: first, to the payment of any amounts owing by that Defaulting Lender to Administrative Agent hereunder; second, as the applicable Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Credit Agreement,
as determined by Administrative Agent; third, if so determined by Administrative Agent and the applicable Borrower, to be held in a non-interest bearing deposit account and released in order to satisfy obligations of such Defaulting Lender to fund Loans under this Credit Agreement; fourth, to the payment of any amounts owing to the non-Defaulting Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against such Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Credit Agreement; fifth, so long as no Default or Event of Default exists, to the payment of any amounts owing to the applicable Borrower as a result of any judgment of a court of competent jurisdiction obtained by Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Credit Agreement; and sixth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if: (x) such payment is a payment of the principal amount of any Loans in respect of which such Defaulting Lender has not fully funded its appropriate share; and (y) such Loans were made at a time when the conditions set forth in Section 4.02 were satisfied or waived, such payment shall be applied solely to pay the Loans of all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or L/C Disbursements owed to, such Defaulting Lender. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post cash collateral pursuant to this Section 2.18(a)(ii) shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(b) Defaulting Lender Cure. If the Borrower and Administrative Agent agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any cash collateral), such Defaulting Lender will, to the extent applicable, purchase that portion of outstanding Loans of the other Lenders or take such other actions as Administrative Agent may determine to be necessary to cause the Loans under the applicable Tranche to be held on a pro rata basis by the Lenders in accordance with their Applicable Percentages, whereupon such Defaulting Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while such Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no cessation in status as Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising during the period that such Lender was a Defaulting Lender.
SECTION 2.19 Mitigation Obligations; Replacement of Lenders.
(a) Each Lender will notify the Borrower of any event occurring after the date of this Agreement which will entitle such Person to compensation pursuant to Sections 2.12 and 2.14 as promptly as practicable after it obtains knowledge thereof and determines to
request such compensation, provided that such Person shall not be liable for the failure to provide such notice. If any Lender requests compensation under Section 2.12, or if the Borrower is required to pay any additional amount to any such Person or any Governmental Authority for the account of any Lender pursuant to Section 2.14, then such Lender shall use reasonable efforts to avoid or minimize the amounts payable, including, without limitation, the designation of a different lending office for funding or booking its Loans hereunder or the assignment of its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.12 or 2.14, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable and documented costs and expenses incurred by any Lender in connection with any such designation or assignment.
(b) If any Lender requests compensation under Section 2.12, or if the Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.14, or if any Lender defaults in its obligation to fund Loans hereunder, or if a Lender does not vote in favor of any amendment, modification, or waiver to this Agreement or any other Loan Document which requires the vote of such Lender, and the Required Lenders shall have voted in favor of such amendment, modification, or waiver, then the Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to, and upon such demand the affected Lender shall promptly, assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not unreasonably be withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts), and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments required to be made pursuant to Section 2.14, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make any such assignment and delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders and the Administrative Agent that:
SECTION 3.01 Organization; Powers . Each Credit Party and each Property Subsidiary is duly organized, validly existing and in good standing under the laws of the jurisdiction
of its organization, has all requisite power and authority to carry on its business as now conducted and, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required.
SECTION 3.02 Authorization; Enforceability . The Transactions are within the corporate, partnership or limited liability company powers (as applicable) of the respective Credit Parties and have been duly authorized by all necessary corporate, partnership or limited liability company action. This Agreement and the Loan Documents have been duly executed and delivered by each Credit Party which is a party thereto and constitute the legal, valid and binding obligation of each such Person, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors' rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03 Governmental Approvals; No Conflicts . The Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect, (b) will not violate any applicable law or regulation or the charter, by-laws or other organizational documents of any Credit Party or any of the Borrower’s Subsidiaries or any order of any Governmental Authority, (c) will not violate or result in a default under any indenture, agreement or other instrument binding upon any Credit Party or any of the Borrower’s Subsidiaries or its assets, or give rise to a right thereunder to require any payment to be made by any Credit Party or any of the Borrower’s Subsidiaries, and (d) will not result in the creation or imposition of any Lien on any asset of any Credit Party or any of the Borrower’s Subsidiaries.
SECTION 3.04 Financial Condition; No Material Adverse Change.
(a) The Parent has heretofore furnished to the Lenders financial statements as of and for the fiscal year ended December 31, 2013 and the fiscal quarter ended September 30, 2014 reported on by Deloitte & Touche, LLP, independent public accountants, for the Borrower and its Subsidiaries. Such financial statements present fairly, in all material respects, the financial position and results of operations and cash flows of the Borrower and its consolidated Subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year-end audit adjustments and the absence of footnotes in the case of the quarter end statements referred to above.
(b) Since September 30, 2014, no event has occurred which could reasonably be expected to have a Material Adverse Effect.
SECTION 3.05 Properties.
(c) Subject to Liens permitted by Section 6.02, each of the Borrower and its Subsidiaries has title to, or valid leasehold interests in, all its real and personal property material to its business, except for minor defects in title that do not interfere with its ability to conduct its business as currently conducted or to utilize such properties for their intended purposes.
(d) RESERVED.
(e) All components of all improvements included within the Real Property in the Unencumbered Pool, including, without limitation, the roofs and structural elements thereof and the heating, ventilation, air conditioning, plumbing, electrical, mechanical, sewer, waste water, storm water, paving and parking equipment, systems and facilities included therein, are in good working order and repair, subject to such exceptions which are not reasonably likely to have, in the aggregate, a Material Adverse Effect. All water, gas, electrical, steam, compressed air, telecommunication, sanitary and storm sewage lines and systems and other similar systems serving the Real Property owned or leased by any Credit Party or any Property Subsidiary are installed and operating and are sufficient to enable the Real Property to continue to be used and operated in the manner currently being used and operated, and no Credit Party has any knowledge of any factor or condition that reasonably could be expected to result in the termination or material impairment of the furnishing thereof, subject to such exceptions which are not likely to have, in the aggregate, a Material Adverse Effect. No improvement or portion thereof is dependent for its access, operation or utility on any land, building or other improvement not included in the Real Property owned or leased by the Borrower or its Subsidiaries, other than for access provided pursuant to a recorded easement or other right of way establishing the right of such access subject to such exceptions which are not likely to have, in the aggregate, a Material Adverse Effect.
(f) All franchises, licenses, authorizations, rights of use, governmental approvals and permits (including all certificates of occupancy and building permits) required to have been issued by Governmental Authority to enable all Real Property owned or leased by Borrower or any of its Subsidiaries to be operated as then being operated have been lawfully issued and are in full force and effect, other than those which the failure to obtain in the aggregate could not be reasonably expected to have a Material Adverse Effect. No Credit Party or any Property Subsidiary is in violation of the terms or conditions of any such franchises, licenses, authorizations, rights of use, governmental approvals and permits, which violation would reasonably be expected to have a Material Adverse Effect.
(g) None of the Credit Parties or any Property Subsidiary has received any notice or has any knowledge, of any pending, threatened or contemplated condemnation proceeding affecting any Real Property owned or leased by Borrower or any of its Subsidiaries or any part thereof, or any proposed termination or impairment of any parking at any such owned or leased Real Property or of any sale or other disposition of any Real Property owned or leased by Borrower or any of its Subsidiaries or any part thereof in lieu of condemnation, which in the aggregate, are reasonably likely to have a Material Adverse Effect.
(h) Except for events or conditions not reasonably likely to have, in the aggregate, a Material Adverse Effect, (i) no portion of any Real Property owned or leased by Borrower or any of its Subsidiaries has suffered any material damage by fire or other casualty loss which has not heretofore been completely repaired and restored to its condition prior to such casualty, and (ii) no portion of any Real Property owned or leased by Borrower or any of
its Subsidiaries is located in a special flood hazard area as designated by any federal Government Authorities or any area identified by the insurance industry or other experts acceptable to the Administrative Agent as an area that is a high probable earthquake or seismic area, except as set forth on Schedule 3.05(f).
(i) There are no Persons operating or managing any Real Property other than the Borrower and the Management Company pursuant to (i) the management agreements delivered to Administrative Agent as of the Effective Date, and (ii) such other management agreements in form and substance reasonably satisfactory to the Administrative Agent. To Borrower’s knowledge, no improvement or portion thereof, or any other part of any Real Property, is dependent for its access, operation or utility on any land, building or other improvement not included in the Real Property owned or leased by the Borrower or its Subsidiaries, other than for access provided pursuant to a recorded easement or other right of way establishing the right of such access.
SECTION 3.06 Intellectual Property . To the knowledge of each Credit Party, such Credit Party and each Property Subsidiary owns, or is licensed to use, all trademarks, trade names, copyrights, patents and other intellectual property material to its business, and the use thereof by such Credit Party does not infringe upon the rights of any other Person, except for any such infringements that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. To the knowledge of each Credit Party, there are no material slogans or other advertising devices, projects, processes, methods, substances, parts or components, or other material now employed, or now contemplated to be employed, by any Credit Party or any Property Subsidiary with respect to the operation of any Real Property, and no claim or litigation regarding any slogan or advertising device, project, process, method, substance, part or component or other material employed, or now contemplated to be employed by any Credit Party or any Property Subsidiary, is pending or threatened, the outcome of which could reasonably be expected to have a Material Adverse Effect.
SECTION 3.07 Litigation and Environmental Matters.
(b) Except as set forth in Schedule 3.07 attached hereto, there are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Borrower, threatened against or affecting any Credit Party or any of the Borrower’s Subsidiaries (i) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect or (ii) that involve this Agreement or the Transactions.
(c) Except with respect to any other matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect :
(i) to the knowledge of the Credit Parties, all Real Property leased or owned by Borrower or any of its Subsidiaries is free from contamination by any Hazardous Material, except to the extent such contamination could not reasonably be expected to cause a Material Adverse Effect;
(ii) to the knowledge of the Credit Parties, the operations of Borrower and its Subsidiaries, and the operations at the Real Property leased or owned by Borrower or any of its Subsidiaries are in compliance with all applicable Environmental Laws, except to the extent such noncompliance could not reasonably be expected to cause a Material Adverse Effect;
(iii) neither the Borrower nor any of its Subsidiaries have known liabilities with respect to Hazardous Materials and, to the knowledge of each Credit Party, no facts or circumstances exist which could reasonably be expected to give rise to liabilities with respect to Hazardous Materials, in either case, except to the extent such liabilities could not reasonably be expected to have a Material Adverse Effect;
(iv) (A) the Borrower and its Subsidiaries and all Real Property owned or leased by Borrower or its Subsidiaries have all Environmental Permits necessary for the operations at such Real Property and are in compliance with such Environmental Permits; (B) there are no legal proceedings pending nor, to the knowledge of any Credit Party, threatened to revoke, or alleging the violation of, such Environmental Permits; and (C) none of the Credit Parties or any Property Subsidiary have received any notice from any source to the effect that there is lacking any Environmental Permit required in connection with the current use or operation of any such properties, in each case, except to the extent the nonobtainment or loss of an Environmental Permit could not reasonably be expected to have a Material Adverse Effect;
(v) neither the Real Property currently leased or owned by Borrower nor any of its Subsidiaries, nor, to the knowledge of any Credit Party, (x) any predecessor of any Credit Party or any Property Subsidiary, nor (y) any of Credit Parties’ or any Property Subsidiaries’ Real Property owned or leased in the past, nor (z) any owner of Real Property leased or operated by Borrower or any of its Subsidiaries, are subject to any outstanding written order or contract, including Environmental Liens, with any Governmental Authority or other Person, or to any federal, state, local, foreign or territorial investigation of which a Credit Party or any Property Subsidiary has been given notice respecting (A) Environmental Laws, (B) Remedial Action, (C) any Environmental Claim; or (D) the Release or threatened Release of any Hazardous Material, in each case, except to the extent such written order, contract or investigation could not reasonably be expected to have a Material Adverse Effect;
(vi) none of the Credit Parties or Property Subsidiaries are subject to any pending legal proceeding alleging the violation of any Environmental Law nor, to the knowledge of each Credit Party, are any such proceedings threatened, in either case, except to the extent any such proceedings could not reasonably be expected to have a Material Adverse Effect;
(vii) neither the Borrower nor any of its Subsidiaries nor, to the knowledge of each Credit Party, any predecessor of any Credit Party or any Property Subsidiary, nor to the knowledge of each Credit Party, any owner of Real Property leased by
Borrower or any of its Subsidiaries, have filed any notice under federal, state or local, territorial or foreign law indicating past or present treatment, storage, or disposal of or reporting a Release of Hazardous Material into the environment, in each case, except to the extent such Release of Hazardous Material could not reasonably be expected to have a Material Adverse Effect;
(viii) none of the operations of the Borrower or any of its Subsidiaries or, to the knowledge of each Credit Party, of any owner of premises currently leased by Borrower or any of its Subsidiaries or of any tenant of premises currently leased from Borrower or any of its Subsidiaries, involve or previously involved the generation, transportation, treatment, storage or disposal of hazardous waste, as defined under 40 C.F.R. Part 261.3 (in effect as of the date of this Agreement) or any state, local, territorial or foreign equivalent, in violation of Environmental Laws, except to the extent the same could not reasonably be expected to have a Material Adverse Effect; and
(ix) to the knowledge of the Credit Parties, there is not now, nor has there been in the past (except, in all cases, to the extent the existence thereof could not reasonably be expected to have a Material Adverse Effect), on, in or under any Real Property leased or owned by Borrower or any of its Subsidiaries, or any of their predecessors (A) any underground storage tanks or surface tanks, dikes or impoundments (other than for surface water); (B) any friable asbestos-containing materials; (C) any polychlorinated biphenyls; or (D) any radioactive substances other than naturally occurring radioactive material.
SECTION 3.08 Compliance with Laws and Agreements . Each of the Credit Parties and each Property Subsidiary is in compliance with all laws, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect. No Default with respect to such laws, regulations and orders of any Governmental Authority has occurred and is continuing. To the knowledge of the Credit Parties, the Credit Parties and their Subsidiaries and their respective officers and employees, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects. None of the Credit Parties, any Subsidiary or, to the knowledge of any Credit Party, any of their respective directors, officers or employees is a Sanctioned Person. No Loan, use of the proceeds of any Loan or other transactions contemplated hereby will violate Anti-Corruption Laws or applicable Sanctions. Neither the making of the Loans hereunder nor the use of the proceeds thereof will violate the Patriot Act, the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 C.F.R., Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto or successor statute thereto. The Credit Parties and their Subsidiaries are in compliance in all material respects with the Patriot Act.
SECTION 3.09 Investment and Holding Company Status . Neither any of the Credit Parties nor any of the Borrower’s Subsidiaries is (a) an “investment company” as defined in, or
subject to regulation under, the Investment Company Act of 1940 or (b) a “holding company” as defined in, or subject to regulation under, the Public Utility Holding Company Act of 1935.
SECTION 3.10 Taxes . Each Credit Party and each of the Borrower’s Subsidiaries has timely filed or caused to be filed all Tax returns and reports required to have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate proceedings and for which such Person has set aside on its books adequate reserves or (b) to the extent that the failure to do so could not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.11 ERISA . No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for which liability is reasonably expected to occur, could reasonably be expected to result in a Material Adverse Effect. The Borrower does not have any Plans as of the date hereof. As to any future Plan the present value of all accumulated benefit obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) will not exceed the fair market value of the assets of such Plan, and the present value of all accumulated benefit obligations of all underfunded Plans (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) will not exceed the fair market value of the assets of all such underfunded Plans.
SECTION 3.12 Disclosure. The Borrower has disclosed or made available to the Lenders all agreements, instruments and corporate or other restrictions to which it, any other Credit Party, or any of its Subsidiaries is subject, and all other matters known to it, that, in the aggregate, could reasonably be expected to result in a Material Adverse Effect. None of the reports, financial statements, certificates or other information furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that, with respect to projected financial information, the Borrower represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.
SECTION 3.13 Insurance. Borrower has provided to Administrative Agent an insurance schedule which accurately sets forth, in all material respects, as of the Effective Date all insurance policies and programs currently in effect with respect to the assets and business of Borrower and its Subsidiaries, specifying for each such policy and program, (i) the amount thereof, (ii) the risks insured against thereby, (iii) the name of the insurer and each insured party thereunder, (iv) the policy or other identification number thereof and (v) the expiration date thereof. Such insurance policies and programs (or such other similar policies as are permitted pursuant to Section 5.06) are currently in full force and effect, and, together with payment by the insured of scheduled deductible payments, are in amounts sufficient to cover the replacement value of the respective assets of the Borrower and its Subsidiaries.
SECTION 3.14 Margin Regulations. The Borrower is not engaged in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of
Regulation U issued by the Board), and no proceeds of any Loan will be used to purchase or carry any margin stock.
SECTION 3.15 Subsidiaries; REIT Qualification. As of the Effective Date, the Parent has only the Subsidiaries listed on Schedule 3.15 attached hereto. Education Realty OP GP, Inc. and Education Realty OP Limited Partnership Trust each qualify as a “qualified REIT subsidiary” under Section 856 of the Code.
ARTICLE IV
Conditions
SECTION 4.01 Effective Date. The obligations of the Lenders to make Loans hereunder shall not become effective until the date on which each of the following conditions is satisfied (or waived in accordance with Section 9.02):
(a) The Administrative Agent (or its counsel) shall have received from each Credit Party either (i) a counterpart of this Agreement and all other Loan Documents to which it is party signed on behalf of such party or (ii) written evidence satisfactory to the Administrative Agent (which may include telecopy transmission of a signed signature page of each such Loan Document other than the Notes) that such party has signed a counterpart of the Loan Documents, together with copies of all Loan Documents.
(b) The Administrative Agent shall have received a favorable written opinion (addressed to the Administrative Agent and the Lenders and dated the Effective Date) of Bass, Berry & Sims PLC, counsel for the Borrower and the Guarantor, and such other counsel as the Administrative Agent may approve, covering such matters relating to the Credit Parties, the Loan Documents or the Transactions as the Required Lenders shall reasonably request. The Borrower hereby requests such counsel to deliver such opinion.
(c) The Administrative Agent shall have received such documents and certificates as the Administrative Agent or its counsel may reasonably request relating to the organization, existence and good standing of the Credit Parties, the authorization of the Transactions and any other legal matters relating to the Credit Parties, this Agreement (including each Credit Party's compliance with Section 9.14 and other customary "know your customer" requirements) or the Transactions, all in form and substance satisfactory to the Administrative Agent and its counsel.
(d) The Administrative Agent shall have received a Compliance Certificate, dated the date of this Agreement and signed by a Financial Officer of EDR, in form and substance satisfactory to the Administrative Agent.
(e) The Administrative Agent shall have received all fees and other amounts due and payable on or prior to the Effective Date, including, to the extent invoiced, reimbursement or payment of all out-of-pocket expenses required to be reimbursed or paid by the Borrower hereunder.
(f) The Administrative Agent shall have received copies of all other Loan Documents, and such other due diligence information as the Administrative Agent may require for each Acceptable Unencumbered Property included in the Unencumbered Pool as of the Effective Date.
(g) The Revolving Facility shall have previously or simultaneously closed.
The Administrative Agent shall notify the Borrower and the Lenders of the Effective Date, and such notice shall be conclusive and binding.
SECTION 4.02 Each Credit Event. The obligation of each Lender to make a Loan on the occasion of any Borrowing, is subject to the satisfaction of the following conditions:
(a) The representations and warranties of each Credit Party set forth in this Agreement or in any other Loan Document shall be true and correct on and as of the date of such Borrowing.
(b) At the time of and immediately after giving effect to such Borrowing, no Default shall have occurred and be continuing.
(c) With respect to any requested Borrowings, the Borrower shall have complied with Section 2.02.
(d) The Administrative Agent shall have received a Compliance Certificate signed by a Financial Officer of EDR for the most recent completed quarter, adjusted to reflect any new Indebtedness incurred, the sale of any Real Property or the addition or removal of any Real Property from the Unencumbered Pool since such quarter end.
Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in this Section.
ARTICLE V
Affirmative Covenants
Until the Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have been paid in full or unless the Required Lenders shall have otherwise consented pursuant to Section 9.02, the Borrower covenants and agrees with the Lenders that:
SECTION 5.01 Financial Statements; Ratings Change and Other Information. The Borrower will furnish to the Administrative Agent and each Lender:
(e) within 90 days after the end of each fiscal year of the Parent, the Parent’s audited consolidated balance sheet and related statements of operations, stockholders' equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year, all reported on by Deloitte & Touche LLP or
other independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit) to the effect that such consolidated financial statements present fairly in all material respects the financial condition and results of operations of the Parent and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied;
(f) within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Parent, the Parent’s consolidated balance sheet and related statements of operations, stockholders' equity and cash flows as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly in all material respects the financial condition and results of operations of the Parent and its consolidated Subsidiaries on a consolidated basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes, and (ii) a property report with a list of all Real Property acquired by the Borrower or any of its Subsidiaries since the last quarterly property report and summary operating information for each property, including the Net Operating Income of each property;
(g) concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of EDR (the “Compliance Certificate”) in the form of Exhibit B attached hereto;
(h) promptly after the same become publicly available for Forms 10-K and 10-Q described below, and upon written request for items other than Forms 10-K and 10-Q described below, copies of all periodic and other reports, proxy statements and other materials filed by the Parent, the Borrower or any Subsidiary with the Securities and Exchange Commission (including registration statements and reports on Form 10-K, 10-Q and 8-K (or their equivalents)), or any Governmental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange, or distributed by the Parent or the Borrower to its shareholders generally, as the case may be;
(i) within thirty (30) days after the beginning of each fiscal year, a current consolidated operating budget of the Parent which includes the Borrower and its Subsidiaries (based on the Parent’s good faith estimates and projections) for that fiscal year, including projected sources and uses of funds (including dividend and debt payments); and
(j) promptly following any request therefor, such other information regarding the operations, business affairs and financial condition of any Credit Party, or compliance with the terms of the Loan Documents, as the Administrative Agent or any Lender may reasonably request.
SECTION 5.02 Financial Tests. The Borrower shall have and maintain, on a consolidated basis in accordance with GAAP, tested as of the close of each fiscal quarter:
(c) a Total Leverage Ratio no greater than sixty percent (60%) at all times;
(d) a Fixed Charge Coverage Ratio of not less than 1.50:1.00 at all times;
(e) a Tangible Net Worth of at least $896,000,000.00, plus seventy-five percent (75%) of the net proceeds (gross proceeds less reasonable and customary costs of sale and issuance paid to Persons not Affiliates of any Credit Party) received by the Borrower or the Parent at any time from the issuance of stock (whether common, preferred or otherwise) of the Parent or the Borrower after the date of this Agreement, at all times;
(f) a Total Secured Debt Ratio of no greater than forty percent (40%) at all times;
(g) a Total Unsecured Debt to Unencumbered Asset Value Ratio of no greater than sixty percent (60%) at all times; and
(h) an Unsecured Interest Coverage Ratio of not less than 1.75:1.00 at all times.
SECTION 5.03 Notices of Material Events. The Borrower will furnish to the Administrative Agent and each Lender written notice of the following promptly after it becomes aware of same (unless specific time is set forth below):
(j) the occurrence of any Default;
(k) within five (5) Business Days after the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting any Credit Party or any Affiliate thereof that, if adversely determined, could reasonably be expected to result in a Material Adverse Effect;
(l) within five (5) Business Days after the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding $10,000,000.00; and
(m) any other development that results in, or could reasonably be expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer or other executive officer of EDR setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
SECTION 5.04 Existence; Conduct of Business. The Borrower will, and will cause each of its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges and franchises material to the conduct of its business; provided that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under Section 6.03. Each Property Subsidiary must at all times be a Subsidiary of Borrower.
SECTION 5.05 Payment of Obligations. The Borrower will, and will cause each of its Subsidiaries to, pay its obligations, including Tax liabilities, that, if not paid, could result in a Material Adverse Effect before the same shall become delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending such contest could not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.06 Maintenance of Properties; Insurance.
(e) The Borrower will, and will cause each of its Subsidiaries to, maintain insurance with financially sound and reputable insurance companies against such risks and in such amounts as is customarily maintained by similar businesses or as may be required by Legal Requirements. The Borrower shall from time to time deliver to the Administrative Agent upon request a detailed list, together with copies of all policies of the insurance then in effect, stating the names of the insurance companies, the amounts and rates of the insurance, the dates of the expiration thereof and the properties and risks covered thereby.
(f) The Borrower will pay and discharge all taxes, assessments, maintenance charges, permit fees, impact fees, development fees, capital repair charges, utility reservations and standby fees and all other similar impositions of every kind and character charged, levied, assessed or imposed against any interest in any of the Real Property in the Unencumbered Pool, as they become payable and before they become delinquent. The Borrower shall furnish receipts evidencing proof of such payment to the Administrative Agent promptly after payment and before delinquency.
SECTION 5.07 Books and Records; Inspection Rights.
(f) The Borrower will, and will cause each of its Subsidiaries to, keep proper books of record and account in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities.
(g) The Borrower will, and will cause each of its Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender, upon reasonable prior notice and subject to rights of tenants, to visit and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested.
SECTION 5.08 Compliance with Laws. The Borrower will, and will cause each of its Subsidiaries to, comply with all laws, rules, regulations and orders of any Governmental Authority applicable to it or its property, except where the failure to do so, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.09 Use of Proceeds
. The proceeds of the Loans will be used for acquisition, development and enhancement of Real Property, debt refinancing, capital improvements and working capital. No part of the proceeds of any Loan will be used, whether directly or indirectly, for financing, funding or completing the hostile acquisition of publicly traded Persons or for any purpose that entails a violation of any of the Regulations of the Board, including Regulations U and X.
SECTION 5.10 Fiscal Year. Borrower shall maintain as its fiscal year the twelve (12)-month period ending on December 31 of each year.
SECTION 5.11 Environmental Matters.
(e) Borrower shall comply and shall cause each of its Subsidiaries and each Real Property owned or leased by such parties to comply in all material respects with all applicable Environmental Laws currently or hereafter in effect, except to the extent noncompliance could not reasonably be expected to have a Material Adverse Effect.
(f) If the Administrative Agent or the Required Lenders at any time have a reasonable basis to believe that there may be a material violation of any Environmental Law related to any Real Property owned or leased by Borrower or any of its Subsidiaries, or Real Property adjacent to such Real Property, which could reasonably be expected to have a Material Adverse Effect, then Borrower agrees, upon request from the Administrative Agent (which request may be delivered at the option of Administrative Agent or at the direction of Required Lenders), to provide the Administrative Agent, at the Borrower’s expense, with such reports, certificates, engineering studies or other written material or data as the Administrative Agent or the Required Lenders may reasonably require so as to reasonably satisfy the Administrative Agent and the Required Lenders that any Credit Party, or Property Subsidiary or Real Property owned or leased by them is in material compliance with all applicable Environmental Laws.
(g) Borrower shall, and shall cause each of its Subsidiaries to, take such Remedial Action or other action as required by Environmental Law or any Governmental Authority.
(h) If the Borrower fails to timely take, or to diligently and expeditiously proceed to complete in a timely fashion, any action described in this Section, the Administrative Agent may, after notice to the Borrower, with the consent of the Required Lenders, make advances or payments toward the performance or satisfaction of the same, but shall in no event be under any obligation to do so. All sums so advanced or paid by the Administrative Agent (including reasonable counsel and consultant and investigation and laboratory fees and expenses, and fines or other penalty payments) and all sums advanced or paid in connection with any judicial or administrative investigation or proceeding relating thereto, will become due and payable from the Borrower ten (10) Business Days after demand, and shall bear interest at the rate for past due interest provided in Section 2.12(c) from the date any such sums are so advanced or paid by the Administrative Agent until the date any such sums are repaid by the Borrower. Promptly upon request, the Borrower will execute and deliver such instruments as the Administrative Agent may deem reasonably necessary to
permit the Administrative Agent to take any such action, and as the Administrative Agent may require to secure all sums so advanced or paid by the Administrative Agent.
SECTION 5.12 Unencumbered Pool. As of the Effective Date, the Unencumbered Pool consists solely of those Acceptable Unencumbered Properties listed on Schedule 5.12, with those Acceptable Unencumbered Properties which are either an Eligible Off Campus Ground Lease or an Eligible Property Lease being so designated thereon (the “Unencumbered Pool”).
SECTION 5.13 Additions to Unencumbered Pool. Provided that no Default then exists, the Borrower may add Real Property to the Unencumbered Pool, subject to the following:
(g) The Borrower has provided the Administrative Agent with a written notice that such Real Property is added in the Unencumbered Pool, together with a certification that the Real Property to be added to the Unencumbered Pool satisfies each of the requirements set forth in the definition of “Acceptable Unencumbered Property”.
(h) If the Borrower requests inclusion of assets in the Unencumbered Pool that do not meet the requirements of this Section, then such assets may only be included in the Unencumbered Pool upon the prior written approval of the Administrative Agent and the Majority Lenders.
SECTION 5.14 Removal of Real Property from Unencumbered Pool. Provided that no Default then exists, the Borrower may remove Real Property from the Unencumbered Pool provided that the Borrower will be in compliance with the terms of this Agreement, including, without limitation Section 5.02 hereof, after giving effect to the removal of any Real Property from the Unencumbered Pool.
SECTION 5.15 Further Assurances. At any time upon the request of the Administrative Agent, Borrower will, promptly and at its expense, execute, acknowledge and deliver such further documents and perform such other acts and things as the Administrative Agent may reasonably request to evidence the Loans made hereunder and interest thereon in accordance with the terms of this Agreement.
SECTION 5.16 [Reserved]
SECTION 5.17 Parent Covenants. The Parent will:
(a) maintain at least one class of common shares of the Parent having trading privileges on the New York Stock Exchange;
(b) own, directly or indirectly, all of the general partner interests in EDR and at least fifty-one percent (51%) of (i) the shares of beneficial interest of EDR, and (ii) each class of security issued by EDR with the power to select the general partner of EDR;
(c) maintain management and control of EDR;
(d) conduct substantially all of its operations through EDR and one or more of EDR’s Subsidiaries;
(e) comply with all Legal Requirements to maintain, and will at all times elect, qualify as and maintain, its status as a real estate investment trust under Section 856(c)(i) of the Code; and
(f) promptly contribute to EDR the net proceeds of any stock sales or debt offerings.
SECTION 5.18 OFAC.
(a) Each Credit Party will comply in all material respects with all Anti-Corruption Laws and applicable Sanctions.
(b) The Borrower shall not request any Loan, or use the proceeds of any Loan, (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws (ii) in any Sanctioned Country, (iii) for the purpose of knowingly funding or financing any Sanctioned Person, or (iv) in any transaction that would result in the violation of any Sanctions by the Borrower or any Subsidiary.
ARTICLE VI
Negative Covenants
Until the Commitments have expired or terminated and the principal of and interest on each Loan and all fees payable hereunder have been paid in full, the Borrower covenants and agrees with the Lenders that:
SECTION 6.01 Sale/Leaseback. The Borrower will not, and will not permit any Subsidiary to, enter into a sale/leaseback, or similar transaction, for any of its Real Property other than PILOT or similar transactions.
SECTION 6.02 Liens. The Borrower will not create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it which is included in the Unencumbered Pool or by a Property Subsidiary, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof, except:
(n) Permitted Encumbrances; and
(o) any Lien on any property or asset of the Borrower or a Property Subsidiary existing on the date hereof and set forth in Schedule 6.02 and any non-recourse Indebtedness of Borrower or Guarantor secured by a Lien on an asset which is not in the Unencumbered Pool; provided that (i) such Lien shall not apply to any other property or asset of the Borrower or any Subsidiary and (ii) such Lien shall secure only those obligations (whether present or future) set forth in the governing loan documents, as of the date hereof and extensions,
renewals and replacements thereof that do not increase the outstanding principal amount thereof.
SECTION 6.03 Fundamental Changes . The Borrower will not, and will not permit any Subsidiary to:
(f) merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one transaction or in a series of transactions) all or substantially all of the assets of the Borrower or all or substantially all of the stock of its Subsidiaries (in each case, whether now owned or hereafter acquired), or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing (i) any Person may merge into, or consolidate with, Parent or Borrower in a transaction in which Parent or Borrower is the surviving entity, (ii) any Person not a Credit Party or a Property Subsidiary may merge into, or consolidate with, any Subsidiary in a transaction in which the surviving entity is a Subsidiary, (iii) any Subsidiary not a Credit Party or a Property Subsidiary may sell, transfer, lease or otherwise dispose of its assets to the Parent, Borrower or to another Subsidiary, (iv) any Subsidiary not a Credit Party or a Property Subsidiary may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution is in the best interests of the Borrower and is not materially disadvantageous to the Lenders, (v) any Subsidiary which is a Credit Party or a Property Subsidiary may merge into (or consolidate with) or liquidate or dissolve into, Parent, Borrower or any other Subsidiary which is a Credit Party or a Property Subsidiary, and (vi) any Subsidiary which is a Credit Party or a Property Subsidiary may sell, transfer, lease or otherwise dispose of its assets to Borrower or to any other Credit Party or a Property Subsidiary; provided that any such merger involving a Person that is not a wholly owned (directly or indirectly) Subsidiary immediately prior to such merger shall not be permitted unless also permitted by Section 6.04.
(g) sell, transfer, lease or otherwise dispose of any of its assets to a Person other than pursuant to clause (a) above if (i) the Value of the assets disposed of in any twelve (12) month period exceeds twenty-five percent (25%) of the Value of the Borrower’s and its Subsidiaries’ Real Property other than Assets Under Development or undeveloped land, before giving effect to such dispositions, or (ii) the assets disposed of in any twelve (12) month period contributed or made up more than twenty-five percent (25%) of the Borrower’s Net Operating Income for such twelve (12) month period.
(h) engage to any material extent in any business other than the ownership, development, operation and management of collegiate housing communities and businesses reasonably related thereto, except as allowed by Section 6.04(e).
SECTION 6.04 Investments, Loans, Advances and Acquisitions . The Borrower will not, and will not permit any of its Subsidiaries to, purchase, hold or acquire (including pursuant to any merger with any Person that was not a wholly owned Subsidiary prior to such merger) any capital stock, evidences of indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, or make
or permit to exist any investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any assets of any other Person constituting a business unit, except:
(d) Permitted Investments;
(e) Real Property operated as collegiate housing communities;
(f) investments in Unconsolidated Affiliates;
(g) undeveloped land;
(h) investments not related to the ownership, development, operation and management of collegiate housing communities;
(i) investments in notes secured by Real Property not to exceed fifteen percent (15%) of Total Asset Value;
(j) Assets Under Development; and
(k) mergers, consolidations and other transactions permitted under Section 6.03, so long as same do not cause the Borrower to be in violation of any provision of this Section 6.04.
In addition to the foregoing, the aggregate value of the investments described in clauses (c), (d), (e), (f) and (g), above shall not exceed thirty percent (30%) of Total Asset Value after giving effect to such investments. The failure to comply with the provisions of this paragraph shall not constitute a Default or an Event of Default, but shall instead result in a reduction of Total Asset Value by the incremental amounts in excess of such maximum amounts. The investments described above may be purchased or acquired, directly or indirectly, through partnerships, joint ventures, or otherwise. The calculations in this Section will be made without duplication if an investment is within more than one category described in this Section.
SECTION 6.05 Hedging Agreements . The Borrower will not, and will not permit any of its Subsidiaries to, enter into any Hedging Agreement, other than Hedging Agreements entered into in the ordinary course of business to hedge or mitigate risks to which the Borrower or any Subsidiary is exposed in the conduct of its business or the management of its liabilities.
SECTION 6.06 Restricted Payments . The Parent will not, and will not permit any of its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, during any calendar quarter, any Restricted Payment, except that any of the following Restricted Payments are permitted: (a) Restricted Payments by the Parent required to comply with Section 5.17(e); or (b) dividends or distributions declared and paid ratably by Subsidiaries to Borrower with respect to their capital stock or equity interest.
Notwithstanding the foregoing, provided no Event of Default is in existence, the amount of Restricted Payments may be increased as long as the increased Restricted Payment, when added to
all Restricted Payments made during the 3 immediately preceding calendar quarters, does not exceed 95% of Funds From Operations for the applicable period.
SECTION 6.07 Transactions with Affiliates . The Borrower will not, and will not permit any of its Subsidiaries to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions with, any of its Affiliates, except (a) in the ordinary course of business at prices and on terms and conditions not less favorable to the Borrower or such Subsidiary than could be obtained on an arm's-length basis from unrelated third parties, (b) transactions between or among the Borrower and its wholly owned Subsidiaries not involving any other Affiliate and (c) any Restricted Payment permitted by Section 6.06, and (d) as permitted by Section 6.03.
SECTION 6.08 Parent Negative Covenants . The Parent will not (a) own any Property other than the ownership interests of EDR and other assets with no more than $10,000,000.00 in value; (b) give or allow any Lien on the ownership interests of EDR; (c) create, incur, suffer or permit to exist, or assume or guarantee, directly or indirectly, contingently or otherwise, or become or remain liable with respect to any Indebtedness if the aggregate of such Indebtedness and the Indebtedness of the Borrower would violate Section 5.02 if such aggregate Indebtedness is treated as the Borrower's Indebtedness or (d) engage to any material extent in any business other than the ownership, development, operation and management of collegiate housing communities. For the avoidance of doubt, the Guaranty provided by Guarantor hereunder shall not be deemed or construed to violate the provisions of this Section 6.08.
SECTION 6.09 Restrictive Agreements . The Borrower will not, and will not permit any of its Subsidiaries to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Subsidiary to create, incur or permit to exist any Lien upon any of its property or assets, or (b) the ability of any Subsidiary to pay dividends or other distributions with respect to any shares of its capital stock or to make or repay loans or advances to the Borrower or any other Subsidiary or to Guarantee Indebtedness of the Borrower or any other Subsidiary; provided that (i) the foregoing shall not apply to restrictions and conditions imposed by law or by this Agreement, (ii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Subsidiary pending such sale, provided such restrictions and conditions apply only to the Subsidiary that is to be sold and such sale is permitted hereunder, (iii) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness or Liens permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness and (iv) clause (a) of the foregoing shall not apply to customary provisions in leases restricting the assignment thereof. Notwithstanding anything herein to the contrary, the provisions of this Agreement (including, without limitation under this Section 6.09) shall not prohibit the use by Borrower, Guarantor, or any Subsidiary (including Property Subsidiary) of Acceptable Unencumbered Properties as a borrowing base for other Unsecured Debt.
SECTION 6.10 Indebtedness . Neither the Parent, the Borrower, nor any Property Subsidiary (at such time as it owns an Acceptable Unencumbered Property in the Unencumbered
Pool) shall, without the prior written consent of the Required Lenders, create, incur, assume, guarantee or be or remain liable, contingently or otherwise with respect to any Indebtedness on a recourse basis, except: (a) Indebtedness of the Parent or the Borrower under this Agreement, any Bond Facility or the Term Facility; (b) Indebtedness of the Parent, the Borrower or a Subsidiary (other than a Property Subsidiary at such time as it owns an Acceptable Unencumbered Property in the Unencumbered Pool) which does not violate the provisions of Section 5.02; (c) with respect to the Parent, the Borrower or a Subsidiary (other than a Property Subsidiary at such time as it owns an Acceptable Unencumbered Property in the Unencumbered Pool), other Indebtedness solely to the extent that the creation, incurrence or assumption thereof would not result in a Default under the terms of this Agreement; and (d) with respect to the Borrower, the Parent or a Subsidiary (other than a Property Subsidiary at such time as it owns an Acceptable Unencumbered Property in the Unencumbered Pool), Indebtedness whose recourse is solely for so-called “bad-boy” acts, including without limitation, (i) failure to account for a tenant’s security deposits, if any, for rent or any other payment collected by a borrower from a tenant under the lease, all in accordance with the provisions of any applicable loan documents, (ii) fraud or a material misrepresentation made by Borrower or any Guarantor, or the holders of beneficial or ownership interests in Borrower or any Guarantor, in connection with the financing evidenced by the applicable loan documents; (iii) any attempt by Borrower or any Guarantor to divert or otherwise cause to be diverted any amounts payable to the applicable lender in accordance with the applicable loan documents; (iv) the misappropriation or misapplication of any insurance proceeds or condemnation awards relating to any Real Property; (v) voluntary or involuntary bankruptcy by Borrower or any Guarantor; and (vi) any environmental matter(s) affecting any Real Property which is introduced or caused by Borrower or any Guarantor or any holder of a beneficial or ownership interest in Borrower or any Guarantor.
ARTICLE VII
Events of Default
If any of the following events (“Events of Default”) shall occur:
(p) the Borrower shall fail to pay any principal of any Loan when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or otherwise;
(q) any Credit Party shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this Article) payable under any Loan Documents, when and as the same shall become due and payable, and such failure shall continue unremedied for a period of over three Business Days (such three Business Day period commencing after written notice from the Administrative Agent as to any such fee);
(r) any representation or warranty made or deemed made by or on behalf of any Credit Party in or in connection with any Loan Document or any amendment or modification thereof or waiver thereunder, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with this Agreement or any amendment
or modification hereof or waiver hereunder, shall prove to have been incorrect in any material respect when made or deemed made;
(s) the Borrower shall fail to observe or perform any covenant, condition or agreement contained in Article V or VI other than Sections 5.04, 5.05, 5.06, 5.07(a), 5.08, and 5.11;
(t) any Credit Party shall fail to observe or perform any covenant, condition or agreement contained in any Loan Document to which it is a party (other than those specified in clause (a), (b) or (d) of this Article), and such failure shall continue unremedied for a period of over 30 days after notice thereof from the Administrative Agent to the Borrower (which notice will be given at the request of any Lender) and if such default is not cureable within thirty (30) days and the Credit Party is diligently pursuing cure of same, the cure period may be extended for 30 days (for a total of 60 days after the original notice from the Administrative Agent) upon written request from the Borrower to the Administrative Agent; provided further that notwithstanding the foregoing, the Borrower shall only have a five (5) Business Day grace period (with no notice from the Administrative Agent required) with respect any failure to comply with Section 5.01;
(u) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity;
(v) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of any Credit Party or any Subsidiary of the Borrower or its debts, or of a substantial part of its assets, under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Credit Party or any Subsidiary of the Borrower or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;
(w) any Credit Party or any Subsidiary of the Borrower shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Article, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for such Person or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;
(x) any Credit Party or any Subsidiary of the Borrower shall become unable, admit in writing its inability or fail generally to pay its debts as they become due;
(y) one or more judgments for the payment of money in an aggregate amount in excess of $20,000,000 shall be rendered against any Credit Party, any Subsidiary of the Borrower or any combination thereof and the same shall remain undischarged for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of such Person to enforce any such judgment;
(z) an ERISA Event shall have occurred that, in the opinion of the Required Lenders, when taken together with all other ERISA Events that have occurred, could reasonably be expected to result in liability of the Borrower and its Subsidiaries in an aggregate amount exceeding $20,000,000;
(aa) the Guaranty of the Loan by the Guarantor shall for any reason terminate or cease to be in full force and effect;
(bb) any Credit Party or any Property Subsidiary shall default under any Material Contract;
(cc) any Credit Party shall (or shall attempt to) disavow, revoke or terminate any Loan Document to which it is a party or shall otherwise challenge or contest in any action, suit or proceeding in any court or before any Governmental Authority the validity or enforceability of any Loan Document; or
(dd) a Change in Control shall occur;
then, and in every such event (other than an event described in clause (g) or (h) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to the Borrower, take some or all of the following actions, at the same or different times: (i) terminate the Commitments, and thereupon the Commitments shall terminate immediately, (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower, and (iii) exercise any other rights or remedies provided under this Agreement (including Section 2.05(j)) or any other Loan Document, or any other right or remedy available by law or equity; and in case of any event described in clause (g) or (h) of this Article, the Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued hereunder, including any Prepayment Premium, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof, together with such actions and powers as are reasonably incidental thereto.
The bank serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates may accept deposits from, lend money to and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if it were not the Administrative Agent hereunder.
The Administrative Agent shall not have any duties or obligations except those expressly set forth herein. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby that the Administrative Agent is required to exercise in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02), and (c) except as expressly set forth herein, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any Credit Party that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02) or in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement, (ii) the contents of any certificate, report or other document delivered hereunder or in connection herewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent. The Administrative Agent agrees that, in fulfilling its duties hereunder, it will use the same standard of care it utilizes in servicing loans for its own account.
The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and
believed by it to be made by the proper Person, and shall not incur any liability for relying thereon. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in good faith in accordance with the advice of any such counsel, accountants or experts.
The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all its duties and exercise its rights and powers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.
Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, the Administrative Agent may resign at any time by notifying the Lenders and the Borrower, and may be removed by the Required Lenders in the event of the Administrative Agent’s gross negligence or willful misconduct. Upon any such resignation or removal, the Required Lenders shall have the right, with the approval of Borrower (provided no Default has occurred and is continuing), which approval shall not be unreasonably withheld, to appoint a successor. If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation or is removed, then the retiring Administrative Agent may, on behalf of the Lenders, appoint a successor Administrative Agent which shall be (i) a Lender, or, if no Lender is willing to serve as the successor Administrative Agent, (ii) a bank with an office in New York, New York, or an Affiliate of any such bank whose senior debt obligations are rated not less than “A” or its equivalent by Moody’s or not less than “A” or its equivalent by S&P and which has a net worth of not less than $500,000,000. Upon the acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall 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. The fees payable by the Borrower to a successor Administrative Agent for its own behalf shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the Administrative Agent's resignation hereunder, the provisions of this Article and Section 9.03 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while it was acting as Administrative Agent. The Administrative Agent shall cooperate with any successor Administrative Agent in fulfilling its duties hereunder.
Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it shall from time to
time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any related agreement or any document furnished hereunder or thereunder.
ARTICLE IX
Miscellaneous
SECTION 9.01 Notices . Except in the case of notices and other communications expressly permitted to be given by telephone, all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy, as follows:
(l) if to the Borrower, to it in care of EDR at 999 South Shady Grove Road, Suite 600, Memphis, TN 38120, Attention: Chief Financial Officer (Telephone No. (901) 259-2500 and Telecopy No. (901) 259-2594));
(m) if to the Administrative Agent, to PNC Bank, National Association, 1600 Market Street, 31st Floor, Philadelphia, Pennsylvania 19103, Attention: Andrew White (Telephone No. (215) 585-6123 and Telecopy No. (215) 585-5806);
(n) if to any other Lender, to it at its address (or telecopy number) set forth on the signature pages of this Agreement, or as provided to Borrower in writing by the Administrative Agent or the Lender.
Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given (i) if given by telecopy, when such telecopy is transmitted to the telecopy number specified in this Section and the appropriate confirmation is received (or if such day is not a Business Day, on the next Business Day); (ii) if given by mail (return receipt requested), on the earlier of receipt or three (3) Business Days after such communication is deposited in the mail with first class postage prepaid, addressed as aforesaid; or (iii) if given by any other means, when delivered at the address specified in this Section; provided that notices to the Administrative Agent under Article II shall not be effective until received.
SECTION 9.02 Waivers; Amendments.
(g) No failure or delay by the Administrative Agent or any Lender in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent and the Lenders hereunder and under any other Loan Document are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by the
Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default at the time.
(h) Neither this Agreement nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of such Lender, (ii) reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of each Lender affected thereby, (iii) postpone the scheduled date of payment of the principal amount of any Loan, or any interest thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent of each Lender affected thereby, (iv) change Section 2.17(b) or (c) in a manner that would alter the pro rata sharing of payments required thereby, without the written consent of each Lender, (v) change any of the provisions of this Section or the definition of “Required Lenders”, “Majority Lenders”, or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender, (vi) release any Credit Party from its obligations under the Loan Documents without the written consent of each Lender, or (vii) subordinate the Loans without the written consent of each Lender; provided further that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent hereunder without the prior written consent of the Administrative Agent. Notwithstanding anything to the contrary contained herein, (i) any term of this Agreement or of any other Loan Document relating solely to the rights and obligations of the Tranche A Lenders, and not any of the Tranche B Lenders, may be amended, and the performance or observance by Borrower or any other Credit Party of any such term may be waived with, and only with, the written consent of the Tranche A Required Lenders, and (ii) any term of this Agreement or of any other Loan Document relating solely to the rights and obligations of the Tranche B Lenders, and not any of the Tranche A Lenders, may be amended, and the performance or observance by Borrower or any other Credit Party of any such term may be waived with, and only with, the written consent of the Tranche B Required Lenders; provided in any event, any such amendments shall not effect or change any term or obligation with respect to the Credit Parties except with their prior written consent.
(i) Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of any Defaulting Lender may
not be increased or extended without the consent of such Lender; and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lenders shall require the consent of such Defaulting Lender.
(j) Notwithstanding the fact that the consent of all the Lenders is required in certain circumstances as set forth above: (1) each Lender is entitled to vote as such Lender sees fit on any reorganization plan that affects the Loans, and each Lender acknowledges that the provisions of Section 1126(c) of the Bankruptcy Code supersede the unanimous consent provisions set forth herein; and (2) the Required Lenders may consent to allow Borrower to use cash collateral in the context of a bankruptcy or insolvency proceeding. Administrative Agent may, after consultation with the Borrower, agree to the modification of any term of this Credit Agreement or any other Loan Document to correct any printing, stenographic or clerical errors or omissions that are inconsistent with the terms hereof.
(k) If Administrative Agent shall request the consent of any Lender to any amendment, change, waiver, discharge, termination, consent or exercise of rights covered by this Credit Agreement, and not receive such consent or denial thereof in writing within ten (10) Business Days of the making of such request by Administrative Agent, as the case may be, such Lender shall be deemed to have given its consent to the request.
SECTION 9.03 Expenses; Indemnity; Damage Waiver.
(h) The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent, in connection with the syndication of the credit facilities provided for herein, the preparation and administration of this Agreement or any amendments, modifications or waivers of the provisions hereof (whether or not the transactions contemplated hereby or thereby shall be consummated), and (ii) all out-of-pocket expenses incurred by the Administrative Agent or any Lender, including the reasonable fees, charges and disbursements of any counsel for the Administrative Agent or any Lender, in connection with the enforcement or protection of its rights in connection with this Agreement, including its rights under this Section, or in connection with the Loans made hereunder, including all such out-of-pocket expenses incurred during any waivers, workout, restructuring or negotiations in respect of such Loans.
(i) The Borrower shall indemnify the Administrative Agent and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including the fees, charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement or any agreement or instrument contemplated hereby, the performance by the parties hereto of their respective obligations hereunder or the consummation of the Transactions or any other transactions contemplated hereby, (ii) any Loan or the use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned
or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses resulted from the gross negligence or willful misconduct of such Indemnitee as determined by a court of law in a final non-appealable judgment.
(j) To the extent that the Borrower fails to pay any amount required to be paid by it to the Administrative Agent under paragraph (a) or (b) of this Section, each Lender severally agrees to pay to the Administrative Agent such Lender's Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent in its capacity as such.
(k) To the extent permitted by applicable law, the Borrower shall not assert, and hereby waives, any claim against any Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement or any agreement or instrument contemplated hereby, the Transactions, any Loan or the use of the proceeds thereof.
(l) All amounts due under this Section shall be payable not later than ten days after written demand therefor.
SECTION 9.04 Successors and Assigns.
(c) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.
(d) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld) of:
(A) the Borrower, provided that no consent of the Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if a Default has occurred and is continuing, any other assignee; and
(B) the Administrative Agent.
Provided, no consent of the Borrower, Administrative Agent shall be required in connection with any assignment to an entity acquiring, or merging with, a Lender.
(ii) Assignments shall be subject to the following additional conditions:
(A) except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning Lender’s Commitment or Loans of any Class, the amount of the Commitment or Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000.00 unless each of the Borrower and the Administrative Agent otherwise consent, provided that no such consent of the Borrower shall be required if a Default has occurred and is continuing and such consent shall not be unreasonably withheld;
(B) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender's rights and obligations under this Agreement, provided that this clause shall not be construed to prohibit the assignment of a proportionate part of all the assigning Lender’s rights and obligations in respect of one Class of Commitments or Loans;
(C) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500.00; and
(D) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.
For the purposes of this Section 9.04(b), the term “Approved Fund” has the following meaning:
“Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv) of this Section, from and after the effective date specified in each Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned
by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender's rights and obligations under this Agreement, such Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 2.14, 2.15, 2.16 and 9.03). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c) of this Section.
(iv) The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the "Register"). The entries in the Register shall be conclusive, and the Borrower, the Administrative Agent and the Lenders may treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and Assumption executed by an assigning Lender and an assignee, the assignee's completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b) of this Section and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent shall accept such Assignment and Assumption and record the information contained therein in the Register. No assignment shall be effective for purposes of this Agreement unless it has been recorded in the Register as provided in this paragraph.
(e) Any Lender may, without the consent of the Borrower or the Administrative Agent, sell participations to one or more banks or other entities (a “Participant”) in all or a portion of such Lender's rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans owing to it); provided that (i) such Lender's obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) that affects such Participant. Subject to paragraph (d) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.14, 2.15 and 2.16 to the same extent as if it were a Lender and
had acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 9.08 as though it were a Lender, provided such Participant agrees to be subject to Section 2.17(c) as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that, except in the case of a Participant asserting any right of set-off pursuant to Section 9.08, no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person (other than Borrower) except to the extent that such disclosure is necessary to establish that such commitment, loan, or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations or except, upon request of Borrower, the Lender shall provide to Borrower the identity of such participant and the amount of its participation. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.
(f) A Participant shall not be entitled to receive any greater payment under Section 2.14 or 2.16 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower's prior written consent. A Participant that would be a Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 2.16 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with Section 2.16(e) as though it were a Lender.
(g) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.
SECTION 9.05 Survival . All covenants, agreements, representations and warranties made by the Borrower herein and in the certificates or other instruments delivered in connection with or pursuant to this Agreement shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the making of any Loans, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue
in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as the Commitments have not expired or terminated. The provisions of Sections 2.14, 2.15, 2.16 and 9.03 and Article VIII shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, or the termination of this Agreement or any provision hereof.
SECTION 9.06 Counterparts; Integration; Effectiveness; Joint and Several.
(c) This Agreement may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.
(d) This Agreement and any separate letter agreements with respect to fees payable to the Administrative Agent constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.
(e) Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.
(f) The obligations of Borrower hereunder shall not be affected by (a) the failure of the Administrative Agent or any Lender to assert any claim or demand or to enforce any right or remedy against Borrower under the provisions of this Agreement, any other Loan Document or otherwise; (b) any extension or renewal of any of the Obligations; (c) any rescission, waiver, amendment or modification of, or release from, any of the terms or provisions of this Agreement, or any other Loan Document or agreement; (d) any default, failure or delay, willful or otherwise, in the performance of any of the Obligations; (e) the failure of the Administrative Agent to take any steps to perfect and maintain any security interest in, or to preserve any rights to, any security or collateral for the Obligations, if any; (f) any change in the corporate, partnership or other existence, structure or ownership of the Borrower or any other guarantor of any of the Obligations; (g) the enforceability or validity of the Obligations or any part thereof or the genuineness, enforceability or validity of any agreement relating thereto or with respect to any collateral securing the Obligations or any part thereof, or any other invalidity or unenforceability relating to or against the Borrower or any other guarantor of any of the Obligations, for any reason related to this Agreement, any other Loan Document, or any provision of applicable law, decree, order or regulation of any jurisdiction purporting to prohibit the payment by the Borrower or any other guarantor of the Obligations, of any of the Obligations or otherwise affecting any term of any of the Obligations; or (h) any other act omission or delay to do any other act which may or might in any manner or to any extent vary the risk of the Borrower or otherwise operate as a
discharge of a guarantor as a matter of law or equity or which would impair or eliminate any right of the Borrower to subrogation.
(g) The obligations of Borrower hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, and shall not be subject to any defense or set-off, counterclaim, recoupment or termination whatsoever, by reason of the invalidity, illegality or unenforceability of any of the Obligations, any impossibility in the performance of any of the Obligations or otherwise.
(h) The Borrower further agrees that its obligations hereunder shall continue to be effective or be reinstated, as the case may be, if at any time payment or any part thereof of any Obligation (including a payment effected through exercise of a right of setoff) is rescinded, or is or must otherwise be restored or returned by the Administrative Agent or any Lender upon the insolvency, bankruptcy or reorganization of Borrower or otherwise (including pursuant to any settlement entered by a holder of Obligations in its discretion.
SECTION 9.07 Severability . Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
SECTION 9.08 Right of Setoff . If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against any of and all the obligations of the Borrower now or hereafter existing under this Agreement held by such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be unmatured. Each Lender agrees promptly to notify the Borrower after any such setoff and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such setoff and application. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.
SECTION 9.09 Governing Law; Jurisdiction; Consent to Service of Process.
(i) This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.
(j) The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the state and federal courts in Pittsburgh, Pennsylvania and in New York, New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees 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. Nothing in this Agreement shall affect any right that the Administrative Agent or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against the Borrower or its properties in the courts of any jurisdiction.
(k) The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(l) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01. Nothing in this Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 9.10 WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11 Headings . Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
SECTION 9.12 Confidentiality . Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its and its Affiliates' directors, officers, employees and agents, including accountants, legal counsel and other advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any regulatory authority, (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or any suit, action or proceeding relating to this Agreement or the enforcement of rights hereunder,
(f) subject to an agreement containing provisions substantially the same as those of this Section, to any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, (g) with the consent of the Borrower or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Administrative Agent or any Lender on a nonconfidential basis from a source other than the Borrower, or (i) to the extent requested by, or required to be disclosed to, any nationally recognized rating agency or similar authority having jurisdiction over it. For the purposes of this Section, “Information” means all information received from any Credit Party relating to the Credit Party or its business, other than any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by any Credit Party; provided that, in the case of information received from any Credit Party after the date hereof, such information is clearly identified at the time of delivery as confidential. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.
SECTION 9.13 Interest Rate Limitation . If at any time there exists a maximum rate of interest which may be contracted for, charged, taken, received or reserved by the Lenders in accordance with applicable law (the “Maximum Rate”), then notwithstanding anything herein to the contrary, at any time the interest applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable law (collectively, the “Charges”), shall exceed such Maximum Rate, the rate of interest payable in respect of such Loan hereunder, together with all Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been paid in respect of such Loan but were not payable as result of the operation of this Section shall be cumulated and the interest and Charges payable to the Lenders in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by the Lenders. If, for any reason whatsoever, the Charges paid or received on the Loans produces a rate which exceeds the Maximum Rate, the Lenders shall credit against the principal of the Loans (or, if such indebtedness shall have been paid in full, shall refund to the payor of such Charges) such portion of said Charges as shall be necessary to cause the interest paid on the Loans to produce a rate equal to the Maximum Rate. All sums paid or agreed to be paid to the holders of the Loans for the use, forbearance or detention of the Loans shall, to the extent permitted by applicable law, be amortized, prorated, allocated and spread in equal parts throughout the full term of this Agreement, so that the interest rate is uniform throughout the full term of this Agreement. The provisions of this Section shall control all agreements, whether now or hereafter existing and whether written or oral, between the parties hereto. Without notice to the Borrower or any other person or entity, the Maximum Rate, if any, shall automatically fluctuate upward and downward as and in the amount by which such maximum nonusurious rate of interest permitted by applicable law fluctuates.
SECTION 9.14 USA PATRIOT Act . Each Lender hereby notifies the Borrower that pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies
the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower in accordance with the Act. Each Credit Party will provide such information and take such actions as are reasonably requested by the Administrative Agent or any Lender in order to assist the Administrative Agent and the Lenders in maintaining compliance with the Patriot Act.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.
|
| |
| EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership
By: EDUCATION REALTY OP GP, INC., a Delaware corporation, its General Partner
By: /s/ J. Drew Koester Name: J. Drew Koester
Title: Chief Accounting Officer, Senior Vice President and Assistant Secretary
|
The Parent joins in the execution of this Agreement to evidence its agreement to the provisions of Sections 5.01, 5.17, 6.06 and 6.08 of this Agreement.
EDUCATION REALTY TRUST, INC.
By: /s/ J. Drew Koester
Name: J. Drew Koester
| |
Title: | Chief Accounting Officer, |
| |
| Senior Vice President and Assistant Secretary |
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
PNC BANK, NATIONAL ASSOCIATION,
individually and as Administrative Agent,
By: /s/ Andrew T. White
Name: Andrew White
Senior Vice President
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
REGIONS BANK
By: /s/ T. Barrett Vawter
Name: T. Barrett Vawter
| |
Title: | Vice President
Real Estate Corporate Banking |
Address:
1900 5th Avenue North, 15th Floor
Birmingham, Alabama 35203
Attention: Terri Crowe
Telephone No.: (205) 581-7614
Telecopy No.: (205) 264-5456
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Lori Y. Jensen
Name: Lori Y. Jensen
Title: Senior Vice President
Address:
1100 Abernathy Rd NE
Bldg # 500, Suite # 1250
Atlanta, Georgia 30328
Attention: Lori Y. Jensen
Telephone No.: 770-512-3118
Telecopy No.: 770-512-3130
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
FIFTH THIRD BANK, an Ohio banking corporation
By: /s/ Michael P. Perillo
Name: Michael P. Perillo
Title: Assistant Vice President
Address:
222 S. Riverside Plaza
Chicago, IL 60606
Attention: Michael P. Perillo
Telephone No.: (312) 704-6829
Telecopy No.: (312) 704-7364
Signature page to Credit Agreement with Education Realty Operating Partnership, LP
KEYBANK NATIONAL ASSOCIATION
By: /s/ Jeffry M. Morrison
Name: Jeffry M. Morrison
Title: Regional Executive
Address:
225 Franklin 18th FL
Boston, MA 02110
Attention: Gregory W. Lane
Telephone No.: 617-385-6212
Telecopy No.: 617-385-6292
SCHEDULE 2.01
|
| | | | | | |
LENDER | AGGREGATE TERM LOAN COMMITMENT | APPLICABLE PERCENTAGE | TRANCHE A COMMITMENT | TRANCHE A APPLICABLE PERCENTAGE | TRANCHE B COMMITMENT | TRANCHE B APPLICABLE PERCENTAGE |
PNC BANK, NATIONAL ASSOCIATION | $75,000,000 | 40.0000000000% | $50,000,000 | 40.8163265300% | $25,000,000 | 38.4615384600% |
REGIONS BANK | $40,000,000 | 21.3333333300% | $40,000,000 | 32.6530612200% | N/A | N/A |
U.S. BANK | $45,000,000 | 24.0000000000% | $15,000,000 | 12.2448979600% | $30,000,000 | 46.1538461500% |
FIFTH THIRD BANK | $15,000,000 | 8.0000000000% | $10,000,000 | 8.1632653060% | $5,000,000 | 7.6923076920% |
KEYBANK | $12,500,000 | 6.6666666670% | $7,500,000 | 6.1224489800% | $5,000,000 | 7.6923076920% |
TOTAL | $187,500,000 | 100.0000000000% | $122,500,000 | 100.0000000000% | $65,000,000 | 100.0000000000% |
SCHEDULE 3.05(F)
1. Earthquake or Seismic Area –
The Berk
2315 College Ave
Berkeley, California 94704
University Village Towers
3500 Iowa Avenue
Riverside, CA 92507
SCHEDULE 3.07
NONE
.
SCHEDULE 3.15
LIST OF SUBSIDIARIES
|
| |
109 Tower FL LLC | EDR Phoenix, LLC |
28th and Aurora at Boulder LLC | EDR State College Limited Partnership |
3949 Lindell, LLC | EDR State College, Inc. |
Anderson Road Lafayette LLC | EDR State College, LLC |
Anderson Road Oxford LLC | EDR Statesboro, LLC |
AOD/Raleigh Residence Hall, LLC (Inactive) | EDR Stillwater Limited Partnership |
Blacksburg VA Housing LLC | EDR Stillwater, Inc. |
Cape Place (DE), LLC | EDR Stillwater, LLC |
Carrollton Place, LLC | EDR Storrs LLC |
Centre Lubbock TX LLC | EDR Storrs II LLC |
Chapel Hill Durham NC GP LLC | EDR Storrs IC LLC |
Chapel Hill Durham NC LP | EDR Syracuse Campus West LLC |
Cottages W. Lafayette IN LLC | EDR Syracuse, LLC |
CV East Lansing MI LLC | EDR Tallahassee I, LLC |
District on Apache Tempe AZ LLC | EDR Tallahassee Limited Partnership |
District on 5th Tucson AZ LLC | EDR Tallahassee, Inc. |
EDR Athens I, LLC | EDR Tallahassee, LLC |
EDR Auburn, LLC(Inactive) | EDR Tampa Limited Partnership(Inactive) |
EDR Austin LLC | EDR Tampa, Inc. (Inactive) |
EDR Berkeley LLC | EDR Tampa, LLC(Inactive) |
EDR Berkeley LP | EDR Technology LLC |
EDR Carbondale, LLC | East Edge Tuscaloosa LLC |
EDR Cayce Manager, Inc. (Inactive) | EDR Tuscaloosa LLC |
EDR Cayce, LLC(Inactive) | EDR Wabash Limited Partnership(Inactive) |
EDR Charlottesville LLC | EDR Wabash, Inc. (Inactive) |
EDR Charlottesville Jefferson LLC | EDR Wabash, LLC(Inactive) |
EDR Charlottesville Wertland LLC | EDR Western Michigan Limited Partnership |
EDR Columbia Limited Partnership | EDR Western Michigan, Inc. |
EDR Columbia, Inc. | EDR Western Michigan, LLC |
EDR Columbia, LLC | Education Realty OP GP, Inc. |
EDR Columbus Limited Partnership | Education Realty OP Limited Partner Trust |
EDR Columbus, Inc. | Education Realty Operating Partnership, LP |
EDR Columbus, LLC | Education Realty Trust, Inc. |
EDR Development LLC | Education Realty Trust, LLC |
EDR Employment Resources, LLC | Fifth Street MN LLC |
EDR Fund GP, Inc. | Fort Greene Brooklyn NY LLC |
EDR Gainesville GP, LLC | GM Westberry LLC |
EDR Gainesville Limited Partnership | Irish Row at Vaness LLC |
EDR Greensboro, LLC | Lemon Street Tempe AZ LLC(Inactive) |
EDR Investment Advisor Inc. | Louisville KY Housing Member LLC |
EDR Investment Fund, LP | Louisville KY Housing Manager LLC |
EDR Knoxville Limited Partnership | Province Kent OH LLC |
EDR Knoxville, Inc. | Retreat at Louisville LLC |
|
| |
EDR Knoxville, LLC | Retreat at State College LLC |
EDR Lawrence Limited Partnership(Inactive) | River Place (DE), LLC |
EDR Lawrence, Inc. (Inactive) | San Marcos Student Housing Manager LLC |
EDR Lawrence, LLC(Inactive) | San Marcos Student Housing Owner LLC |
EDR Lexington I LLC | State College Housing LLC |
EDR Lexington II LLC | Stinson at Norman, LLC |
EDR Lexington III LLC | Stillwater Student Housing Manager LLC |
EDR Lexington IV LLC | Stillwater Student Housing Owner LLC |
EDR Lexington V LLC | Suites Lubbock TX LLC |
EDR Lexington VI LLC | The Province Greenville NC LP |
EDR Lexington VII LLC | The Province Greenville NC GP LLC |
EDR Limpar, LLC | University Towers OP GP, LLC |
EDR Lubbock Limited Partnership (Inactive) | University Towers Operating Partnership, LP |
EDR Lubbock, LLC (Inactive) | University Towers Raleigh Services, LLC |
EDR Management Inc. | University Village - Greensboro, LLC |
EDR Manager, LLC | University Village Towers, LLC |
EDR Murfreesboro, LLC (Inactive) | University Village Towers, LP |
EDR OP Development LLC | Varsity Ann Arbor Equity Partners, LLC |
EDR Orlando Limited Partnership | Varsity Ann Arbor MI LLC |
EDR Orlando, Inc. | Varsity at Ann Arbor, LLC |
EDR Orlando, LLC | West Clayton GA LLC |
EDR Oxford, LLC | |
EDR Phoenix/Summa West LLC | |
| |
| |
SCHEDULE 5.12
UNENCUMBERED POOL
1. Players Club Tallahassee – Tallahassee, Leon County, FL
2. 605 West – Durham, Durham County, NC
3. The Commons at Tallahassee – Tallahassee, Leon County, FL
4. 109 Tower – Miami, Miami-Dade County, FL
5. Campus Creek – Oxford, Lafayette County, MS
6. Grandmarc at the Corner – Charlottesville, Albemarle County, VA*
7. Wertland Square – Charlottesville, Albemarle County, VA
8. Jefferson Commons – Charlottesville, Albemarle County, VA
9. Central Hall – Lexington, Fayette County, KY**
10. The Lofts Orlando – Orlando, Orange County, FL
11. Campus Lodge – Gainesville, Alachua County, FL
12. The District on Apache – Tempe, Maricopa County, AZ
13. The District on 5th – Tucson, Pima County, AZ
14. Campus Village – East Lansing, Ingham County, MI*
15. Province at Kent State – Kent, Portage County, OH
16. The Province – Greenville, Pitt County, NC
17. The Berk – Berkeley, Alameda County, CA
18. University Village Tower – Riverside, Riverside County, CA
19. The Retreat at State College – State College, Centre County, PA
20. The Cottages on Lindberg – West Lafayette, Tippecanoe County, IN
21. 2400 Nueces – Austin, Travis County, TX
22. 3949 Lindell – St. Louis, Saint Louis City, MO
23. University Village on Colvin – Syracuse, Onondaga County, NY**
24. Carrollton Crossing – Carrollton, Carroll County, GA
25. The Avenue at Southern – Statesboro, Bulloch County, GA
26. Campus West – Syracuse, Onondaga County, NY*
27. East Edge – Tuscaloosa, Tuscaloosa County, AL
28. The Oaks on the Square – Phase I and II – Storrs, Tolland County, CT
29. Grandmarc at Westberry Place – Fort Worth, Denton County, TX*
30. Woodland Glen I and II – Lexington, Fayette County, KY**
31. The Lotus – Boulder, Boulder County, CO
32. Champions Court II – Lexington, Fayette County, KY**
33. Haggin Hall I – Lexington, Fayette County, KY**
34. Champions Court I – Lexington, Fayette County, KY**
* denotes Eligible Off Campus Ground Lease
** denotes Eligible Property Lease
SCHEDULE 6.02
EXISTING LIENS
None
CREDIT AGREEMENT
EXHIBIT A
ASSIGNMENT AND ASSUMPTION
This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”). Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.
For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including any guarantees included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.
1. Assignor: ______________________________
2. Assignee: ______________________________
[and is an Affiliate/Approved Fund of [identify Lender]]
3. Borrower: Education Realty Operating Partnership, LP and certain of its
Subsidiaries
| |
4. | Administrative Agent: PNC Bank, National Association, as the administrative agent under the Credit Agreement |
| |
5. | Credit Agreement: The Amended and Restated Credit Agreement dated as of November 19, 2014, among Education Realty Operating Partnership, LP, certain of its Subsidiaries, the Lenders parties thereto, PNC Bank, National Association, as Administrative Agent, and the other agents parties thereto |
6. Assigned Interest:
|
| | |
Aggregate Amount of Commitment/Loans for all Lenders | Amount of Commitment/Loans Assigned | Percentage
Assigned of Commitment/Loans |
$_____ | $_____ | _____% |
$_____ | $_____ | _____% |
$_____ | $_____ | _____% |
| |
Effective Date: | ______________________, 20____ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.] |
The terms set forth in this Assignment and Assumption are hereby agreed to:
ASSIGNOR
[NAME OF ASSIGNOR]
By:
Title:
ASSIGNEE
[NAME OF ASSIGNEE]
By:
Title:
[Consented to and] Accepted:
[PNC Bank, National Association], as
Administrative Agent
By:
Title:
[Consented to:]
[NAME OF RELEVANT PARTY]
By:
Title:
ANNEX 1
STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION
1. Representations and Warranties.
1.1 Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Borrower, any of its Subsidiaries or Affiliates or any other Person of any of their respective obligations under any Loan Document.
1.2. Assignee. The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements, if any, specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, and (v) if it is a Foreign Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.
2. Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.
3. General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.
CREDIT AGREEMENT
EXHIBIT B
FORM OF COMPLIANCE CERTIFICATE
|
| | | | | | | | | | | | | | | | | | | | | | | | |
|
PNC Bank, National Association | | | | | |
as Administrative Agent | | | | | | | |
1600 Market Street, 31st Floor | | | | | | | | |
Philadelphia, Pennsylvania 19103 | | | | | | | | |
Attention: | | | | | | | | |
| | | | | | | | | |
Attn: Mr. Andrew White | | | | | | | |
| | | | | | | | | |
RE: Education Realty Operating Partnership, LP |
| Compliance Certificate for | ____________ | through | __________ |
| | | | | | | | | |
Dear Ladies and Gentlemen:
| | | | | |
This Compliance Certificate is made with reference to that certain Amended and Restated Credit Agreement dated as of November 19, 2014 (as amended, supplemented or otherwise modified from time to time, the "Credit Agreement"), among Education Realty Operating Partnership, LP (collectively, the "Borrower"), the financial institutions party thereto, as lenders, and PNC Bank, National Association, as Administrative Agent. All capitalized terms used in this Compliance Certificate (including any attachments hereto) and not otherwise defined in this Compliance Certificate shall have the meanings set forth for such terms in the Credit Agreement. All Section references herein shall refer to the Credit Agreement. |
| | | | | | | | | |
I hereby certify that I am the Chief Accounting Officer of Education Realty Operating Partnership, LP, and that I make this Certificate on behalf of Borrower. I further represent and certify on behalf of the Borrower as follows as of the date of this Compliance Certificate: |
| | | | | | | | | |
| I have reviewed the terms of the Loan Documents and have made, or have caused to be made under my supervision, a review in reasonable detail of the transactions and consolidated and consolidating financial condition of the Borrower and its Subsidiaries, during the accounting period (the "Reporting Period") covered by the financial reports delivered simultaneous herewith pursuant to Section 5.01[(a)][(b)], and that such review has not disclosed the existence during or at the end of such Reporting Period (and that I do not have knowledge of the existence as at the date hereof) of any condition or event which constitutes a Default or Event of Default. | |
| | | | | | | | | |
| All referenced dollar amounts in this certificate are stated in thousands unless otherwise noted. | | |
| | | | | | | | | |
| Attached hereto as Schedule A-1 is a list of the Real Property that comprises the Unencumbered Pool and the Unencumbered Asset Value, and Schedule A-2 is a list of the Real Property assets that were identified as being in the Unencumbered Pool in the last Compliance Certificate and that are no longer qualified to be in the Unencumbered Pool as of the last day of the Reporting Period. | |
| | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| Attached hereto as Schedule B-1 is a detailed calculation of Interest Expense for the Reporting Period and Schedule B-2 is a detailed calculation of Interest Expense, principal paid and due and payable on Indebtedness, and cash dividends payable on the Parent's preferred stock for the Reporting Period, which amounts aggregated: | |
| | | | | | | | | |
| Schedule B-1 | $ | |
| Schedule B-2 | $ | |
| | | | | | | | | |
| Attached hereto as Schedule C is a detailed calculation of EBITDA for the Reporting Period, which amount was: | |
| | | | | | | | | |
| Schedule C EBITDA | | | | $ | |
| | | | | | | | | |
As of the last day of the Reporting Period: | | | | | | |
| | | | | | | | | |
1. | Fixed Charge Coverage Ratio Calculation: | | | | | |
| | | | | | | | | |
| ( a ) | EBITDA | | | | $ |
| ( b ) | Capital Expenditure Reserve | | | | $ |
| ( c ) | (a)-(b) | | | | | | $ |
| ( d ) | Adjusted EBIDTA Principal paid and due and payable plus Interest | | | | |
| | Expense plus cash dividends on preferred stock | | | $ |
| ( d ) | Fixed Charge Coverage Ratio ((c) to ((d)) | | | | |
| | | | | | | | |
| | Covenant: 1.50 :1.00 | | | | | |
| | | | | | | | | |
2. | Tangible Net Worth ("TNW"): | | | | | | |
| | | | | | | | | |
| Total Tangible Net Worth at closing | | | | $750,000,000.00 |
| | | | | | | | | |
| Required Tangible Net Worth | | | | | |
| | | | | | | | | |
| | Net Proceeds of Offerings after Effective Date | $ | | |
| | | | | | | 75 | % | | |
| | | | | | $ | | |
| | | | | | | | | |
| | Plus | | | | $ | | |
| | | | | | | | | |
| | | Total Required Tangible Net Worth | | | $ |
| | | | | | | | | |
| | | Covenant: Current TNW must exceed required TNW | | |
| | | | | | | | | |
3. | Total Leverage Ratio Calculation: | | | | | |
| | | | | | | | | |
| ( a ) | Indebtedness | | | | | $ |
| ( b ) | Total Asset Value | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
| ( c ) | Total Leverage Ratio | | | | | % |
| | | | | | | | | |
| | Covenant: less than sixty percent (60%) at all times | | | | | |
| | | | | | | | | |
4. | Total Secured Debt Ratio: | | | | | |
| | | | | | | | | |
| ( a ) | Secured Debt | | | $ |
| ( b ) | Total Asset Value | | | $ |
| ( c ) | Total Secured Debt Ratio | | | % |
| | | | | | | | | |
| | Covenant: no greater than 40% | | | | |
| | | | | | | | | |
5. | Total Unsecured Debt to Unencumbered Asset Value | | | |
| | | | | | | | | |
| ( a ) | Total Unsecured Debt | | | $ |
| ( b ) | Unencumbered Asset Value | | | $ |
| | | | | | | | | |
| | Covenant: no greater than 60% | | | | |
| | | | | | | | | |
| | | | | | | | | |
6. | Unsecured Interest Coverage | | | |
| |
| |
| | (i) Adjusted Unencumbered NOI | $_____ |
| | (ii) Unsecured Interest Expense | $_____ |
| | (iii) (i) / (ii) | | | | | | | |
| | | | | | |
| | | | | | |
| | Covenant: Not less than 1.75 to 1.0 | | | | _____ |
| | | | | | | | | |
7. | ( a ) | ( i ) | Investments in Unconsolidated Affiliates | | $ |
| | | | | | | | | |
| ( b ) | ( i ) | Investments in undeveloped land | | | $ |
| | | | | | | | | |
| ( c ) | ( i ) | Investments in Assets Under Development | | $ |
| | | | | | | | | |
| ( d ) | ( i ) | Investments in Real Property not constituting | | | |
| | | collegiate housing communities | | $ |
| ( e ) | ( i ) | Investments in undeveloped land, Unconsolidated | | |
| | | Affiliates, Assets Under Development and | | | |
| | | non-collegiate housing communities | $ |
| | ( ii ) | Total Asset Value | | | | $ |
| | ( iii ) | (i) / (ii), expressed as a percentage | | | ___% |
| | | | | | | | | |
| | Covenant: <30% | | | | |
| | | | | | | | | |
|
| | | | | | | | | | | | | | | | | | | | | | | | |
8. | Restricted Payments | | | | | | |
| | | | | | | | | |
| (a) | Restricted Payments to be made on or after ______________ for reporting period |
| | and restricted payments made preceding 3 quarters
Covenant: any increased Restricted Payment, when added to all Restricted Payments made during the 3 immediately preceding calendar quarters, shall not exceed 95% of Funds From Operations for the applicable period |
| | | | | | | | | |
| | | 2Q 201_ Dividend per share Common Stock | $ |
| | | 1Q 201_ Dividend per share Common Stock ______ | $ |
| | | 4Q 201_ Dividend per share Common Stock ______ | $ |
| | | 3Q 201_ Dividend per share Common Stock _______ | $ |
| | | | | | | | | |
| This Compliance Certificate has been executed and delivered as of the date set forth above. |
| | | | | | | | | |
| | | | EDUCATION REALTY OPERATING PARTNERSHIP, LP |
| | | | | | | | | |
| | | | By: | Education Realty OP GP, Inc., General Partner |
| | | | | | | | | |
| | | | | | | | | |
| | | | By: | | | | | |
| | | | Name: | J. Drew Koester | | | |
| | | | Title: | Senior Vice President and Chief Accounting Officer |
| | | | | | | | | |
CREDIT AGREEMENT
EXHIBIT C
FORM OF GUARANTY
THIS GUARANTY dated as of _______________, 2014, executed and delivered by the undersigned (the “Guarantor”), in favor of (a) PNC BANK, NATIONAL ASSOCIATION, in its capacity as Administrative Agent (the “Agent”) for the Lenders under that certain Amended and Restated Credit Agreement dated as of November 19, 2014, by and among EDUCATION REALTY OPERATING PARTNERSHIP, LP (the “Borrower”), the financial institutions party thereto and their assignees in accordance therewith (the “Lenders”), and the Agent (as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with its terms, the “Credit Agreement”) and (b) the Lenders.
WHEREAS, pursuant to the Credit Agreement, the Lenders have made available to the Borrower certain financial accommodations on the terms and conditions set forth in the Credit Agreement;
WHEREAS, the Borrower and the Guarantor, though separate legal entities, are mutually dependent on each other in the conduct of their respective businesses as an integrated operation and have determined it to be in their mutual best interests to obtain financing from the Agent and the Lenders through their collective efforts;
WHEREAS, the Guarantor acknowledges that it will receive direct and indirect benefits from the Agent and the Lenders making such financial accommodations available to the Borrower under the Credit Agreement and, accordingly, the Guarantor is willing to guarantee the Borrower’s obligations to the Agent and the Lenders on the terms and conditions contained herein; and
WHEREAS, the Guarantor’s execution and delivery of this Guaranty is one of the conditions precedent to the Agent and the Lenders making, or continuing to make, such financial accommodations to the Borrower.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the Guarantor, the Guarantor agrees as follows:
Section 1. Guaranty. The Guarantor hereby absolutely and unconditionally guaranties the due and punctual payment and performance of all of the following when due (collectively referred to as the “Obligations”): (a) all indebtedness and obligations owing by the Borrower to any of the Lenders or the Agent under or in connection with the Credit Agreement and any other Loan Document, including without limitation, the repayment of all principal of the Loans made by the Lenders to the Borrower under the Credit Agreement and the payment of all interest, fees, charges, reasonable attorneys’ fees and other amounts payable to any Lender or the Agent thereunder or in connection therewith (including any Hedging Agreement, except with respect to the Guarantor, if and to the extent that, all or a portion of the guaranty of the Guarantor of obligations under the Hedging Agreement is or becomes illegal under the Commodity Exchange Act or any rule, regulation
or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of the Guarantor’s failure at the time a Transaction is entered into under the Hedge Agreement to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder); (b) any and all extensions, renewals, modifications, amendments or substitutions of the foregoing; and (c) all expenses, including, without limitation, reasonable attorneys’ fees and disbursements, that are incurred by the Lenders or the Agent in the enforcement of any of the foregoing or any obligation of the Guarantor hereunder.
Section 2. Guaranty of Payment and Not of Collection. This Guaranty is a guaranty of payment, and not of collection, and a debt of the Guarantor for its own account. Accordingly, the Lenders and the Agent shall not be obligated or required before enforcing this Guaranty against the Guarantor: (a) to pursue any right or remedy the Lenders or the Agent may have against the Borrower or any other Person or commence any suit or other proceeding against the Borrower or any other Person in any court or other tribunal; (b) to make any claim in a liquidation or bankruptcy of the Borrower or any other Person; or (c) to make demand of the Borrower or any other Person or to enforce or seek to enforce or realize upon any collateral security held by the Lenders or the Agent which may secure any of the Obligations. In this connection, the Guarantor hereby waives the right of the Guarantor to require any holder of the Obligations to take action against the Borrower as provided by any legal requirement of any Governmental Authority.
Section 3. Guaranty Absolute. The Guarantor guarantees that the Obligations will be paid strictly in accordance with the terms of the documents evidencing the same, regardless of any legal requirement now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of the Agent or the Lenders with respect thereto. The liability of the Guarantor under this Guaranty shall be absolute and unconditional in accordance with its terms and shall remain in full force and effect without regard to, and shall not be released, suspended, discharged, terminated or otherwise affected by, any circumstance or occurrence whatsoever (other than the full and final payment and performance of the Obligations), including, without limitation, the following (whether or not the Guarantor consents thereto or has notice thereof):
(a) (i) any change in the amount, interest rate or due date or other term of any of the Obligations; (ii) any change in the time, place or manner of payment of all or any portion of the Obligations; (iii) any amendment or waiver of, or consent to the departure from or other indulgence with respect to, the Credit Agreement, any other Loan Document, or any other document or instrument evidencing or relating to any Obligations; or (iv) any waiver, renewal, extension, addition, or supplement to, or deletion from, or any other action or inaction under or in respect of, the Credit Agreement, any of the other Loan Documents, or any other documents, instruments or agreements relating to the Obligations or any other instrument or agreement referred to therein or evidencing any Obligations or any assignment or transfer of any of the foregoing;
(b) any lack of validity or enforceability of the Credit Agreement, any of the other Loan Documents, or any other document, instrument or agreement referred to therein or evidencing any Obligations or any assignment or transfer of any of the foregoing;
(c) any furnishing to the Agent or the Lenders of any security for the Obligations, or any sale, exchange, release or surrender of, or realization on, any collateral security for the Obligations;
(d) any settlement or compromise of any of the Obligations, any security therefor, or any liability of any other party with respect to the Obligations, or any subordination of the payment of the Obligations to the payment of any other liability of the Borrower;
(e) any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution, liquidation or other like proceeding relating to the Borrower or any other Person, or any action taken with respect to this Guaranty by any trustee or receiver, or by any court, in any such proceeding;
(f) any nonperfection of any security interest or other Lien on any of the collateral securing any of the Obligations;
(g) any act or failure to act by the Borrower or any other Person which may adversely affect the Guarantor’s subrogation rights, if any, against the Borrower to recover payments made under this Guaranty;
(h) any application of sums paid by the Borrower or any other Person with respect to the liabilities of the Borrower to the Agent or the Lenders, regardless of what liabilities of the Borrower remain unpaid;
(i) any defect, limitation or insufficiency in the borrowing powers of the Borrower or in the exercise thereof; or
(j) any other circumstance which might otherwise constitute a defense available to, or a discharge of, the Guarantor hereunder.
Section 4. Action with Respect to Obligations. The Lenders and the Agent may in accordance with the Credit Agreement, at any time and from time to time, without the consent of, or notice to, the Guarantor, and without discharging the Guarantor from its obligations hereunder take any and all actions described in Section 3 and may otherwise: (a) amend, modify, alter or supplement the terms of any of the Obligations, including, but not limited to, extending or shortening the time of payment of any of the Obligations or the interest rate that may accrue on any of the Obligations; (b) amend, modify, alter or supplement the Credit Agreement or any other Loan Document; (c) sell, exchange, release or otherwise deal with all, or any part, of any collateral securing any of the Obligations; (d) release any Person liable in any manner for the payment or collection of the Obligations; (e) exercise, or refrain from exercising, any rights against the Borrower or any other Person; and (f) apply any sum, by whomsoever paid or however realized, to the Obligations in such order as the Lenders or the Agent shall elect in accordance with the Credit Agreement.
Section 5. Representations and Warranties. The Guarantor hereby makes to the Agent and the Lenders all of the representations and warranties made by the Borrower with respect to or in any way relating to the Guarantor in the Credit Agreement and the other Loan Documents, as if the same were set forth herein in full.
Section 6. Covenants. The Guarantor will comply with all covenants which the Borrower is to cause the Guarantor to comply with under the terms of the Credit Agreement or any other Loan Documents.
Section 7. Waiver. The Guarantor, to the fullest extent permitted by applicable law, hereby waives notice of acceptance hereof or any presentment, demand, protest or notice of any kind, and any other act or thing, or omission or delay to do any other act or thing, which in any manner or to any extent might vary the risk of the Guarantor or which otherwise might operate to discharge the Guarantor from its obligations hereunder.
Section 8. Inability to Accelerate Loan. If the Agent and/or the Lenders are prevented from demanding or accelerating payment thereof by reason of any automatic stay or otherwise, the Agent and/or the Lenders shall be entitled to receive from the Guarantor, upon demand therefor, the sums which otherwise would have been due had such demand or acceleration occurred.
Section 9. Reinstatement of Obligations. The Guarantor agrees that this Guaranty shall continue to be effective or be reinstated, as the case may be, with respect to any Obligations if at any time payment of any such Obligations is rescinded or otherwise must be restored by the Agent and/or the Lenders upon the bankruptcy or reorganization of the Borrower or the Guarantor or otherwise.
Section 10. Subrogation. Until all of the Obligations shall have been indefeasibly paid in full, any right of subrogation the Guarantor may have shall be subordinate to the rights of Agent and the Lenders and the Guarantor hereby waives any right to enforce any remedy which the Agent and/or the Lenders now have or may hereafter have against the Borrower, and the Guarantor hereby waives any benefit of, and any right to participate in, any security or collateral given to the Agent and the Lenders to secure payment or performance of any of the Obligations.
Section 11. Payments Free and Clear. All sums payable by the Guarantor hereunder shall be made free and clear of and without deduction for any Indemnified Taxes (as defined in the Credit Agreement) or Other Taxes (as defined in the Credit Agreement); provided that if the Guarantor shall be required to deduct any Indemnified Taxes or Other Taxes from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section), the Agent or any Lender (as defined in the Credit Agreement) (as the case may be) receives an amount equal to the sum it would have received had no such deductions been made; (ii) the Guarantor shall make such deductions; and (iii) the Guarantor shall pay the full amount deducted to the relevant Governmental Authority (as defined in the Credit Agreement) in accordance with applicable law.
Section 12. Set-off. In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, each Lender is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by such Lender to or for the credit or the account of the Guarantor against any of and all the obligations of the Guarantor now or hereafter existing under this Guaranty held by such Lender then due and payable. The Guarantor agrees, to the fullest extent it may effectively do so
under applicable law, that any holder of a participation in a Note, whether or not acquired pursuant to the applicable provisions of the Credit Agreement, may exercise rights of setoff or counterclaim and other rights with respect to such participation as fully as if such holder of a participation were a direct creditor of the Guarantor in the amount of such participation.
Section 13. Subordination. The Guarantor hereby expressly covenants and agrees for the benefit of the Agent and the Lenders that all obligations and liabilities of the Borrower to the Guarantor of whatever description, including without limitation, all intercompany receivables of the Guarantor from the Borrower (collectively, the “Junior Claims”) shall be subordinate and junior in right of payment to all Obligations; provided, however, that payment thereof may be made so long as no Event of Default shall have occurred and be continuing. If an Event of Default shall have occurred and be continuing, then the Guarantor shall not accept any direct or indirect payment (in cash, property, securities by setoff or otherwise) from the Borrower on account of or in any manner in respect of any Junior Claim until all of the Obligations have been indefeasibly paid in full.
Section 14. Avoidance Provisions. It is the intent of the Guarantor, the Agent and the Lenders that in any Proceeding, the Guarantor’s maximum obligation hereunder shall equal, but not exceed, the maximum amount which would not otherwise cause the obligations of the Guarantor hereunder (or any other obligations of the Guarantor to the Agent and the Lenders) to be avoidable or unenforceable against the Guarantor in such Proceeding as a result of applicable law, including without limitation, (a) Section 548 of the Bankruptcy Code of 1978, as amended (the “Bankruptcy Code”) and (b) any state fraudulent transfer or fraudulent conveyance act or statute applied in such Proceeding, whether by virtue of Section 544 of the Bankruptcy Code or otherwise. The applicable laws under which the possible avoidance or unenforceability of the obligations of the Guarantor hereunder (or any other obligations of the Guarantor to the Agent and the Lenders) shall be determined in any such Proceeding are referred to as the “Avoidance Provisions.” Accordingly, to the extent that the obligations of the Guarantor hereunder would otherwise be subject to avoidance under the Avoidance Provisions, the maximum Obligations for which the Guarantor shall be liable hereunder shall be reduced to that amount which, as of the time any of the Obligations are deemed to have been incurred under the Avoidance Provisions, would not cause the obligations of the Guarantor hereunder (or any other obligations of such Guarantor to the Agent and the Lenders), to be subject to avoidance under the Avoidance Provisions. This Section is intended solely to preserve the rights of the Agent and the Lenders hereunder to the maximum extent that would not cause the obligations of the Guarantor hereunder to be subject to avoidance under the Avoidance Provisions, and the Guarantor and no other Person shall have any right or claim under this Section as against the Agent and the Lenders that would not otherwise be available to such Person under the Avoidance Provisions.
Section 15. Information. The Guarantor assumes all responsibility for being and keeping itself informed of the financial condition of the Borrower and of all other circumstances bearing upon the risk of nonpayment of any of the Obligations and the nature, scope and extent of the risks that the Guarantor assumes and incurs hereunder, and agrees that none of the Agent or any Lender shall have any duty whatsoever to advise the Guarantor of information regarding such circumstances or risks.
Section 16. Governing Law. THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 17. Jurisdiction; Venue; JURY WAIVER.
(a) The Guarantor hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the state and federal courts in Pittsburgh, Pennsylvania and in New York, New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Guaranty or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such State or, to the extent permitted by law, in such Federal court. Each of the parties hereto agrees 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. Nothing in this Guaranty shall affect any right that the Agent or any Lender may otherwise have to bring any action or proceeding relating to this Guaranty or any other Loan Document against the Guarantor or its properties in the courts of any jurisdiction.
(c) The Guarantor hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Guaranty or any other Loan Document in any court referred to in paragraph (a) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d) WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTY, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
Section 18. Loan Accounts. The Agent may maintain books and accounts setting forth the amounts of principal, interest and other sums paid and payable with respect to the Obligations, and in the case of any dispute relating to any of the outstanding amount, payment or receipt of Obligation or otherwise, the entries in such account shall be binding upon the Guarantor as to the outstanding amount of such Obligations and the amounts paid and payable with respect thereto absent manifest
error. The failure of the Agent to maintain such books and accounts shall not in any way relieve or discharge the Guarantor of any of its obligations hereunder.
Section 19. Waiver of Remedies. No delay or failure on the part of the Agent or the Lenders in the exercise of any right or remedy it may have against the Guarantor hereunder or otherwise shall operate as a waiver thereof, and no single or partial exercise by the Agent or the Lenders of any such right or remedy shall preclude other or further exercise thereof or the exercise of any other such right or remedy.
Section 20. Successors and Assigns. Each reference herein to the Agent or the Lenders shall be deemed to include such Person’s respective successors and assigns (including, but not limited to, any holder of the Obligations) in whose favor the provisions of this Guaranty also shall inure, and each reference herein to the Guarantor shall be deemed to include the Guarantor’s successors and assigns, upon whom this Guaranty also shall be binding. The Lenders and the Agent may, in accordance with the applicable provisions of the Credit Agreement, assign, transfer or sell any Obligation, or grant or sell participation in any Obligations, to any Person or entity without the consent of, or notice to, the Guarantor and without releasing, discharging or modifying the Guarantor’s obligations hereunder. The Guarantor hereby consents to the delivery by the Agent or any Lender to any assignee, transferee or participant of any financial or other information regarding the Borrower or the Guarantor. The Guarantor may not assign or transfer its obligations hereunder to any Person.
Section 21. Amendments. This Guaranty may not be amended except as provided in the Credit Agreement.
Section 22. Payments. All payments made by the Guarantor pursuant to this Guaranty shall be made in Dollars, in immediately available funds to the Agent at the place and time provided for in the Credit Agreement on the date one (1) Business Day after written demand therefor to the Guarantor by the Agent.
SECTION 23. [RESERVED].
Section 24. Notices. All notices, requests and other communications hereunder shall be in writing and shall be given as provided in the Loan Agreement. The Guarantor’s address for notice is set forth below its signature hereto.
Section 25. Severability. In case any provision of this Guaranty shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Section 26. Headings. Section headings used in this Guaranty are for convenience only and shall not affect the construction of this Guaranty.
Section 27. Definitions. (a) For the purposes of this Guaranty:
“Proceeding” means any of the following: (i) a voluntary or involuntary case concerning the Guarantor shall be commenced under the Bankruptcy Code or any other applicable bankruptcy laws; (ii) a custodian (as defined in the Bankruptcy Code or any other applicable bankruptcy laws) is appointed for, or takes charge of, all or any substantial part of the property of the Guarantor; (iii) any other proceeding under any applicable law, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding-up or composition for adjustment of debts, whether now or hereafter in effect, is commenced relating to the Guarantor; (iv) the Guarantor is adjudicated insolvent or bankrupt; (v) any order of relief or other order approving any such case or proceeding is entered by a court of competent jurisdiction; (vi) the Guarantor makes a general assignment for the benefit of creditors; (vii) the Guarantor shall fail to pay, or shall state that it is unable to pay, or shall be unable to pay, its debts generally as they become due; (viii) the Guarantor shall call a meeting of its creditors with a view to arranging a composition or adjustment of its debts; (ix) the Guarantor shall by any act or failure to act indicate its consent to, approval of or acquiescence in any of the foregoing; or (x) any corporate action shall be taken by the Guarantor for the purpose of effecting any of the foregoing.
(b) Terms not otherwise defined herein are used herein with the respective meanings given them in the Credit Agreement.
IN WITNESS WHEREOF, the Guarantor has duly executed and delivered this Guaranty as of the date and year first written above.
(GUARANTOR)
EDUCATION REALTY TRUST, INC.
By:
Name:
Title:
Address for Notices:
c/o EDUCATION REALTY OPERATING
PARTNERSHIP, LP
999 South Shady Grove Road, Suite 600
Memphis, Tennessee 38120
Attention: ___________________________
CREDIT AGREEMENT
EXHIBIT D
FORM OF NOTE
$_________________ __________, 2014
FOR VALUE RECEIVED, Education Realty Operating Partnership, LP (the “Maker”) promises to pay without offset or counterclaim to the order of [insert name of Lender], (“Payee”), the principal amount equal to the lesser of (x) __________________________ ($_____________) or (y) the outstanding amount advanced by Payee as a Loan (or Loans) under the Credit Agreement (as hereinafter defined), payable in accordance with the terms of the Credit Agreement.
Maker also promises to pay interest on the unpaid principal amount of this Note (this “Note”) at the rates and at the times which shall be determined in accordance with the provisions of that certain Amended and Restated Credit Agreement dated of even date herewith, among Maker, the Lenders named therein, and PNC BANK, NATIONAL ASSOCIATION, as Administrative Agent for itself and the Lenders (as hereafter amended, supplemented or otherwise modified from time to time, the “Credit Agreement”). Capitalized terms used herein without definition shall have the meanings set forth in the Credit Agreement.
Amounts paid and prepaid hereunder may not be reborrowed.
This Note is subject to mandatory prepayment and prepayment at the option of the Maker, as provided in the Credit Agreement.
This Note is issued pursuant to the Credit Agreement and is entitled to the benefits of the Credit Agreement, reference to which is hereby made for a more complete statement of the terms and conditions under which the Loan evidenced hereby is made and is to be repaid.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. MAKER AGREES THAT JURISDICTION AND VENUE FOR ANY ACTION REGARDING THIS NOTE SHALL BE AS SET FORTH IN THE CREDIT AGREEMENT.
Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement.
Maker promises to pay all fees, costs and expenses incurred in the collection and enforcement of this Note in accordance with the terms of the Credit Agreement. Maker and any endorser of this Note hereby consents to renewals and extensions of time at or after the maturity hereof, without notice, and hereby waive diligence, presentment, protest, demand and notice of every kind (except
such notices as may be expressly required under the Credit Agreement or the other Loan Documents) and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder.
Whenever possible, each provision of this Note shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Note shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Note.
IN WITNESS WHEREOF, Maker has caused this Note to be executed and delivered by its duly authorized officer, as of the day and year first written above.
|
| |
| |
| EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership
By: EDUCATION REALTY OP GP, INC., a Delaware corporation, its General Partner
By: ___________________________ Name:______________________
Title:_______________________ |
| |
CREDIT AGREEMENT
EXHIBIT E
FORM OF INTEREST RATE ELECTION
[Date]
PNC Bank, National Association,
as Administrative Agent
PNC Firstside Center, 4th Floor
500 First Avenue
Pittsburgh, PA 15219
Attn: Kelly DiCicco
kelly.dicicco@pnc.com
Re: Education Realty Operating Partnership, LP
Interest Rate Election
Dear Ladies and Gentlemen:
This Request is made with reference to that certain Amended and Restated Credit Agreement dated as of November 19, 2014 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among Education Realty Operating Partnership, LP and certain of its Subsidiaries (collectively, the “Borrower”), the financial institutions party thereto, as lenders, and PNC Bank, National Association, as Administrative Agent. All capitalized terms used in this Interest Rate Election (including any attachments hereto) and not otherwise defined in this Interest Rate Election shall have the meanings set forth for such terms in the Credit Agreement. All Section references herein shall refer to the Credit Agreement. This request is made by Education Realty Operating Partnership, LP on behalf of the Borrower.
The Borrower hereby requests a conversion of an existing Loan as provided below and/or in the amount of $____________ [minimum of $1,000,000.00 and in multiples of $100,000.00].
The advance or conversion is to be made as follows:
A. ABR Borrowing.
| |
1. | Amount of ABR Borrowing: $_____________ |
| |
2. | Date of ABR Borrowing _____________ |
B. Eurodollar Borrowing:
| |
1. | Amount of Eurodollar Borrowing: $_____________ |
| |
2. | Amount of conversion of existing |
Loan to Eurodollar Borrowing: $_____________
Borrowing(s) now in effect: _____________
[cannot exceed six (6)]
| |
4. | Date of Eurodollar Rate Borrowing |
or conversion: _____________
| |
5. | Interest Period: _____________ |
| |
6. | Expiration date of current Interest |
Period as to this conversion: _____________
The Borrower hereby represents and warrants that the amounts set forth above are true and correct, that the amount above requested has actually been incurred, that the representations and warranties contained in the Credit Agreement are true and correct as if made as of this date (except to the extent relating to a specific date), and that the Borrower has kept, observed,
performed and fulfilled each and every one of its obligations under the Credit Agreement as of the date hereof [except as follows: _______________]
Very truly yours,
EDUCATION REALTY OPERATING PARTNERSHIP, LP
By: EDUCATION REALTY OP GP, INC., its General Partner
By:
Name:
Title:
1761946.7
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