AIV Apartment Investment and Management Company

On December 1 , 2020, Apartment Investment and Management Company, a Maryland corporation (“Aimco”), AIMCO OP L.P., a Delaware limited partnership (“Aimco OP”), and certain subsidiaries of Aimco OP (the “Collateral Pool Loan Parties,” and, collectively with Aimco and Aimco OP, the “Loan Parties”) entered into a credit agreement (the “Credit Agreement”) with the lenders from time to time party thereto and PNC Bank, National Association, as administrative agent (in such capacity, the “Administrative Agent”), swingline loan lender and letter of credit issuing lender.

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The obligations of the Loan Parties under the Credit Agreement and the other loan documents are secured by mortgages or deeds of trust on certain parcels of real estate owned by the Collateral Pool Loan Parties (the “Collateral Pool Properties”). After giving effect to any borrowing of revolving loans or swingline loans or the issuance of any letter of credit under the Revolving Credit Facility, the outstanding amount of revolving loans and swingline loans and the aggregate amount available to be drawn under all outstanding letters of credit issued under the Revolving Credit Facility (collectively, the “Revolving Facility Usage”) may not exceed 55% of the “as is” values of the Collateral Pool Properties, as determined by the most recently delivered appraisals commissioned, reviewed and approved by the Administrative Agent (the “Borrowing Base Amount”).

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Aimco OP may terminate or, from time to time, reduce the aggregate amount of commitments under the Revolving Credit Facility; provided that no such termination or reduction of commitments shall be permitted if, after giving effect thereto and to any prepayments of revolving loans made at such time, the Revolving Facility Usage would exceed the aggregate commitments under the Revolving Credit Facility. The borrowers may prepay revolving loans from time to time without premium or penalty (except for customary compensation for

 

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LIBOR breakage costs). If the Revolving Facility Usage exceeds the Borrowing Base Amount, the borrowers are required to repay revolving loans in a principal amount equal to such excess within one business day after learning of such excess.

The Credit Agreement contains customary representations and warranties and affirmative and negative covenants, including (subject to specified exclusions) limitations on the ability of Aimco OP or any Collateral Pool Loan Party to incur debt, create liens or become a party to any merger or consolidation; limitations on the ability of any Loan Party to pay dividends, repurchase equity interests or make other distributions to the holders of its equity interests if a default has occurred or is continuing or would result therefrom, enter into transactions with affiliates or amend its organizational documents; and limitations on the ability of any Collateral Pool Loan Party to acquire all or substantially all of the assets or equity interests of any other person or entity, own or create any subsidiary, become party to any joint venture or permit any material change in its business. In addition, Aimco may not (a) cease to have its common stock listed on any of the New York Stock Exchange, the American Stock Exchange or the NASDAQ Stock Exchange or (b) cease to have REIT status or fail to comply with the requirements of the Internal Revenue Code relating to qualified REIT subsidiaries in respect of its ownership of any subsidiary that is intended to be a qualified REIT subsidiary of Aimco to the extent required under the Internal Revenue Code and applicable law. The Loan Parties are subject to certain financial covenants, including a minimum fixed charge covenant ratio of 1.25 to 1.00, a maximum leverage ratio of 0.60 to 1.00 and a minimum adjusted tangible net worth of $625,000,000 plus 75.0% of the aggregate proceeds received by Aimco and its consolidated subsidiaries (net of reasonable related fees and expenses and net of any redemption of shares, units or other equity interests in Aimco and its consolidated subsidiaries during such period) in connection with any offering of any equity interests. The Collateral Pool Loan Parties are subject to certain additional representations, warranties and covenants relating to the Collateral Pool Properties.

The Credit Agreement also contains customary events of default, including nonpayment of principal and other amounts when due; breach of covenants; inaccuracy of representations and warranties; cross-default and cross-acceleration to other material indebtedness of any Loan Party or any of its subsidiaries; certain bankruptcy or insolvency events; material judgments against any Loan Party; certain ERISA matters; actual or asserted invalidity of any loan document; and a change of control. After the occurrence and during the continuance of an event of default, the Administrative Agent, with the consent of or upon the request of lenders holding a majority in principal amount of the commitments under the Revolving Credit Facility, may terminate the commitments or declare the unpaid principal amount of all outstanding loans and other amounts owing or payable under the loan documents to be immediately due and payable, in addition to certain other remedies, including remedies against the Collateral Pool Properties.

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