EX-10.22.1 2 irt-ex10221_6.htm EX-10.22.1 irt-ex10221_6.htm

Exhibit 10.22.1

EXECUTION VERSION

 

 

CREDIT AGREEMENT

 

Dated as of May 1, 2017 by and among

INDEPENDENCE REALTY OPERATING PARTNERSHIP, LP, AS PARENT BORROWER,

THE SUBSIDIARY BORROWERS PARTY HERETO, CITIBANK, N.A. and KEYBANK NATIONAL ASSOCIATION, AS ISSUING LENDERS AND SWING LOAN LENDERS,

THE OTHER LENDERS WHICH ARE PARTIES TO THIS AGREEMENT, OTHER LENDERS THAT MAY BECOME

PARTIES TO THIS AGREEMENT, AND

KEYBANK NATIONAL ASSOCIATION, AS AGENT,

WITH

 

CITIGROUP GLOBAL MARKETS INC. and THE HUNTINGTON NATIONAL BANK, AS CO-SYNDICATION AGENTS,

BANK OF AMERICA, N.A., CAPITAL ONE, NATIONAL ASSOCIATION, CITIZENS BANK, N.A., COMERICA BANK and REGIONS BANK,

 

AS CO-DOCUMENTATION AGENTS,

 

CITIGROUP GLOBAL MARKETS INC. and KEYBANC CAPITAL MARKETS, AS JOINT BOOKRUNNERS

AND

 

CITIGROUP GLOBAL MARKETS INC., KEYBANC CAPITAL MARKETS and THE HUNTINGTON NATIONAL BANK,

 

AS JOINT LEAD ARRANGERS

 

 

$300 MILLION SENIOR UNSECURED CREDIT FACILITY

 


TABLE OF CONTENTS

 

§1DEFINITIONS AND RULES OF INTERPRETATION1

§1.1Definitions1

§1.2Rules of Interpretation31

§2THE CREDIT FACILITY32

§2.1Loans32

§2.2Notes33

§2.3Unused Fee; Facility Fee33

§2.4Reduction and Termination of the Revolving Credit Commitments33

§2.5Swing Loan Commitment34

§2.6Interest on Loans36

§2.7Requests for Revolving Credit Loans37

§2.8Funds for Loans37

§2.9Use of Proceeds37

§2.10Letters of Credit38

§2.11Increase in Total Commitment41

§2.12Extension of Revolving Credit Maturity Date42

§2.13Incremental Term Loan Facility43

§3REPAYMENT OF THE LOANS44

§3.1Stated Maturity44

§3.2Mandatory Prepayments44

§3.3Optional Prepayments45

§3.4Partial Prepayments45

§3.5Effect of Prepayments45

§3.6Sharing of Payments, Etc45

§4CERTAIN GENERAL PROVISIONS47

§4.1Conversion Options47

§4.2Fees47

§4.3[Reserved]47

§4.4Funds for Payments47

§4.5Computations50

§4.6Suspension of LIBOR Rate Loans50

§4.7Illegality51

§4.8Additional Interest51

§4.9Additional Costs, Etc51

§4.10Capital Adequacy52

§4.11Breakage Costs52

§4.12Default Interest; Late Charge52

§4.13Certificate52

§4.14Limitation on Interest53

§4.15Certain Provisions Relating to Increased Costs and Non-Funding Lenders53

§4.16Cash Collateral Account54

§5UNENCUMBERED ASSETS55

 

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§5.1Initial Unencumbered Assets55

§5.2Addition of Unencumbered Assets55

§5.3Failure of Unencumbered Asset Conditions55

§5.4Borrower Election to Remove Unencumbered Assets56

§5.5Release of Subsidiary Borrowers56

§5.6Additional Subsidiary Borrowers56

§5.7Costs and Expenses of Additions and Removals56

§6REPRESENTATIONS AND WARRANTIES57

§6.1Corporate Authority, Etc57

§6.2Governmental Approvals58

§6.3Title to Unencumbered Assets58

§6.4Financial Statements58

§6.5No Material Changes58

§6.6[Reserved]58

§6.7Litigation59

§6.8No Material Adverse Contracts, Etc59

§6.9Compliance with Other Instruments, Laws, Etc59

§6.10Tax Status59

§6.11No Event of Default59

§6.12Investment Company Act59

§6.13Absence of UCC Financing Statements, Etc59

§6.14EEA Financial Institutions60

§6.15Unencumbered Asset Conditions60

§6.16Employee Benefit Plans60

§6.17Disclosure60

§6.18Place of Business60

§6.19Regulations T, U and X60

§6.20Environmental Compliance60

§6.21Subsidiaries; Organizational Structure60

§6.22Leases60

§6.23Property61

§6.24Brokers61

§6.25Other Debt61

§6.26Solvency61

§6.27No Bankruptcy Filing61

§6.28No Fraudulent Intent61

§6.29Transaction in Best Interests of Loan Parties; Consideration61

§6.30OFAC62

§6.31REIT Status62

§7AFFIRMATIVE COVENANTS62

§7.1Punctual Payment62

§7.2Maintenance of Office62

§7.3Records and Accounts62

§7.4Financial Statements, Certificates and Information62

§7.5Notices64

§7.6Existence; Maintenance of Properties65

§7.7Insurance65

§7.8Taxes; Liens67

§7.9Inspection of Unencumbered Assets and Books67

 

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§7.10Compliance with Laws, Contracts, Licenses, and Permits67

§7.11Further Assurances68

§7.12[Reserved]68

§7.13[Reserved]68

§7.14Business Operations68

§7.15[Reserved]68

§7.16Ownership of Real Estate68

§7.17[Reserved]68

§7.18Plan Assets68

§7.19Parent Guarantor Covenants68

§7.20Transactions With Affiliates68

§7.21Keepwell69

§8NEGATIVE COVENANTS69

§8.1Restrictions on Indebtedness69

§8.2Restrictions on Liens, Etc71

§8.3[Reserved]73

§8.4Merger, Consolidation73

§8.5[Reserved]74

§8.6Compliance with Environmental Laws74

§8.7[Reserved]74

§8.8Asset Sales74

§8.9[Reserved]75

§8.10Restriction on Prepayment of Indebtedness75

§8.11[Reserved]75

§8.12Derivatives Contracts75

§8.13[Reserved]75

§8.14[Reserved]75

§9FINANCIAL COVENANTS75

§9.1Maximum Consolidated Leverage Ratio75

§9.2Minimum Consolidated Fixed Charge Coverage Ratio75

§9.3Minimum Consolidated Tangible Net Worth75

§9.4Maximum Distributions75

§9.5Maximum Secured Leverage Ratio76

§9.6Maximum Secured Recourse Indebtedness76

§9.7Maximum Unhedged Variable Rate Indebtedness76

§9.8Unencumbered Assets76

§9.9Maximum Unsecured Leverage Ratio76

§9.10Minimum Unencumbered Assets Debt Service Coverage Ratio76

§10CLOSING CONDITIONS76

§10.1Loan Documents76

§10.2Certified Copies of Organizational Documents76

§10.3Resolutions77

§10.4Incumbency Certificate; Authorized Signers77

§10.5Opinion of Counsel77

§10.6Payment of Fees77

§10.7Opinion of Agent’s Special Counsel77

§10.8Performance; No Default77

 

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§10.9Representations and Warranties77

§10.10Proceedings and Documents77

§10.11[Reserved]77

§10.12Compliance Certificate77

§10.13[Reserved]78

§10.14Consents78

§10.15Refinancing78

§10.16Other78

§11CONDITIONS TO ALL BORROWINGS78

§11.1Prior Conditions Satisfied78

§11.2Representations True; No Default78

§11.3Borrowing Documents78

§11.4[Reserved]78

§12EVENTS OF DEFAULT; ACCELERATION; ETC78

§12.1Events of Default and Acceleration78

§12.2Certain Cure Periods80

§12.3Termination of Commitments and Actions in Respect of Letters of Credit81

§12.4Remedies81

§12.5Distribution of Loan Proceeds82

§13SETOFF82

§14AGENT83

§14.1Authorization83

§14.2Employees and Agents83

§14.3No Liability83

§14.4No Representations83

§14.5Payments84

§14.6Holders of Notes84

§14.7Indemnity84

§14.8Agent as Lender84

§14.9Resignation84

§14.10Duties in the Case of Enforcement85

§14.11Bankruptcy85

§14.12[Reserved]86

§14.13Reliance by Agent86

§14.14Approvals86

§14.15Borrowers Not Beneficiaries86

§14.16Defaulting Lenders86

§14.17Reliance on Hedge Provider88

§15EXPENSES88

§16INDEMNIFICATION89

§17SURVIVAL OF COVENANTS, ETC90

§18ASSIGNMENT AND PARTICIPATION90

 

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§18.1Conditions to Assignment by Lenders90

§18.2Register90

§18.3New Notes91

§18.4Participations91

§18.5Pledge by Lender92

§18.6No Assignment by Loan Parties92

§18.7Disclosure92

§18.8Titled Agents92

§18.9Amendments to Loan Documents92

§19NOTICES93

§20RELATIONSHIP93

§21GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE93

§22HEADINGS94

§23COUNTERPARTS94

§24ENTIRE AGREEMENT, ETC94

§25WAIVER OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS94

§26DEALINGS WITH THE LOAN PARTIES94

§27CONSENTS, AMENDMENTS, WAIVERS, ETC95

§28SEVERABILITY96

§29TIME OF THE ESSENCE96

§30NO UNWRITTEN AGREEMENTS96

§31REPLACEMENT NOTES96

§32NO THIRD PARTIES BENEFITED96

§33PATRIOT ACT97

§34RESERVED97

§35JOINT AND SEVERAL LIABILITY97

§36ADDITIONAL AGREEMENTS CONCERNING OBLIGATIONS OF THE BORROWERS97

§36.1Attorney-in-Fact97

§36.2Accommodation97

§36.3Waiver of Automatic or Supplemental Stay97

§36.4Waiver of Defenses97

§36.5Waiver99

§36.6Subordination100

 

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§37ACKNOWLEDGMENT OF BENEFITS; EFFECT OF AVOIDANCE PROVISIONS100

§38RECOURSE PROVISIONS101

§39ACKNOWLEDGEMENT AND CONSENT TO BAIL-IN OF EEA FINANCIAL

INSTITUTIONS101

 

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EXHIBITS AND SCHEDULES

 

Exhibit A-1FORM OF REVOLVING CREDIT NOTE

Exhibit A-2FORM OF TERM NOTE

Exhibit BFORM OF SWING LOAN NOTE

Exhibit CFORM OF JOINDER AGREEMENT

Exhibit DFORM OF REQUEST FOR REVOLVING CREDIT LOAN Exhibit EFORM OF LETTER OF CREDIT REQUEST

Exhibit FFORM OF AVAILABILITY CERTIFICATE

Exhibit GFORM OF COMPLIANCE CERTIFICATE

Exhibit HFORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT Exhibit IFORM OF LETTER OF CREDIT APPLICATION

Exhibit JFORM OF SUBSIDIARY BORROWER RELEASE Schedule 1.1-ALENDERS AND COMMITMENTS

Schedule 1.1-BDISQUALIFIED LENDERS

Schedule 5.1INITIAL UNENCUMBERED ASSETS Schedule 6.3LIST OF ALL ENCUMBRANCES ON ASSETS Schedule 6.5NO MATERIAL CHANGES

Schedule 6.7PENDING LITIGATION Schedule 6.20ENVIRONMENTAL MATTERS

Schedule 6.21(a)PARENT BORROWER SUBSIDIARIES Schedule 6.23PROPERTY CONDITION; OPTIONS Schedule 8.1SPECIFIED INDEBTEDNESS

Schedule 8.14MANAGEMENT FEES

Schedule 19NOTICE ADDRESSES

 

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EXECUTION VERSION

 

 

CREDIT AGREEMENT

 

THIS CREDIT AGREEMENT is made as of the 1st day of May, 2017, by and among INDEPENDENCE REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership (“Parent Borrower”), the Subsidiary Borrowers party hereto from time to time, CITIBANK, N.A. (together with any successor in interest, “Citibank”) and KEYBANK NATIONAL ASSOCIATION (together with  any successor in interest, “KeyBank”), as initial Lenders, Issuing Lenders and Swing Loan Lenders, the other lending institutions which are parties to this Agreement as “Lenders”, the other lending institutions that may become parties hereto pursuant to §18 and KEYBANK NATIONAL ASSOCIATION, as administrative agent for Lenders (“Agent”), with CITIGROUP GLOBAL MARKETS INC. and THE HUNTINGTON NATIONAL BANK, as Co-Syndication Agents (collectively, “Syndication Agents”), BANK OF  AMERICA,    N.A.,    CAPITAL    ONE,    NATIONAL    ASSOCIATION,    CITIZENS    BANK, N.A.,

COMERICA BANK and REGIONS BANK, as Co-Documentation Agents (collectively, “Documentation Agents”),  CITIGROUP GLOBAL  MARKETS  INC. and  KEYBANK  CAPITAL  MARKETS  as Joint

Bookrunners (collectively, “Bookrunners”) and CITIGROUP GLOBAL MARKETS INC., KEYBANK CAPITAL MARKETS and THE HUNTINGTON NATIONAL BANK, as Joint Lead Arrangers (collectively, Arrangers”).

 

R E C I T A L S

 

WHEREAS, the Borrowers have requested that Lenders provide a term loan facility and a revolving loan facility to the Borrowers; and

 

WHEREAS, Agent and Lenders are willing to provide such term loan facility and revolving loan facility on and subject to the terms and conditions set forth herein; and

 

WHEREAS, each Guarantor is willing to guaranty all of the Obligations of the Borrowers pursuant to this Agreement and the other Loan Documents on the terms and conditions set forth in the Guaranty to which  it is a party; and

 

WHEREAS, substantially contemporaneously with the closing of the Facility (defined below), the Existing Credit Facility (as defined below) shall be repaid in full and all commitments with respect thereto  shall be terminated (the Refinancing”);

 

NOW, THEREFORE, in consideration of the recitals herein and mutual covenants and agreements contained herein, the parties hereto hereby covenant and agree as follows:

 

§1DEFINITIONS AND RULES OF INTERPRETATION.

 

§1.1   Definitions.  The following terms shall have the meanings set forth in this §1 or elsewhere in  the provisions of this Agreement referred to below:

 

1031 Cash”: Cash or Cash Equivalents of a Loan Party constituting “like-kind exchange” proceeds under Section 1031 of the Code, held in escrow in accordance with the requirements of Section 1031 of the Code by a Qualified Intermediary (a) with respect to which such Loan Party is the sole beneficiary and (b) that are not subject to any Liens of any kind (including any such Lien or restriction imposed by (i) any agreement governing Indebtedness and (ii) the organizational documents of the Loan Parties or any of their respective Subsidiaries) and, in each case, that (1) are not subject to any agreement (including (x) any agreement governing Indebtedness and (y) if applicable, the organizational documents of the Loan Parties or any of their respective Subsidiaries) which prohibits or limits the ability of the Parent Guarantor or any of its Subsidiaries to create, incur, assume or suffer to exist any Lien upon such assets (excluding any agreement or  organizational document which limits generally the amount of Indebtedness which may be incurred by the Parent  Guarantor  or  its  Subsidiaries),  and (2) are not  subject  to any agreement  (including any   agreement

 

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governing Indebtedness) which entitles any Person to the benefit of any Lien on such assets, or would entitle any Person to the benefit of any such Lien upon the occurrence of any contingency (including, without limitation, pursuant to an “equal and ratable” clause); but excluding, in each case, customary agreements under which the Qualified Institution acts in connection with such like-kind exchange and establishing that the Qualified Institution acts at the direction of the applicable Loan Party.

 

Acceding Lender”:  See §2.11(a).

 

Accession Agreement”:  See §2.11(c).

 

Additional Commitment Request Notice”:  See §2.11(a).

 

Additional Incremental Term Loan Lender”:  See §2.13(b).

 

Additional Subsidiary Borrower”: Each additional Subsidiary of Parent Borrower which becomes a Subsidiary Borrower pursuant to §5.6.

 

Adjusted EBITDA”: On any date of determination, Consolidated EBITDA less, with respect to Real Estate owned by any Person in the Consolidated Group, the Capital Expenditure Reserve, and, with respect to Real Estate owned by Non-Wholly Owned Subsidiaries, the Consolidated Group Pro Rata Share of the Capital Expenditure Reserve.

 

Affected Lender”:  See §4.15.

 

Affiliate”: An Affiliate, as applied to any Person, shall mean any other Person directly or indirectly controlling, controlled by, or under common control with, that Person. For purposes of this  definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any Person, means (a) the possession, directly or indirectly, of the power to vote fifty percent (50%) or more of the stock, shares, voting trust certificates, beneficial interest, partnership interests, member interests or other interests having voting power for the election of directors of such Person or otherwise to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities or by contract or otherwise, or (b) the ownership of (i) a general partnership interest, (ii) a managing member’s or manager’s interest in a limited liability company or (iii) a limited partnership interest or preferred stock (or other ownership interest) representing fifty percent (50%) or more of the outstanding limited partnership interests, preferred stock or other ownership interests of such Person.

 

Agent”: KeyBank National Association, acting as administrative agent for Lenders, and its successors and assigns.

 

Agent’s Head Office”: Agent’s head office located at 127 Public Square, Cleveland, Ohio 44114- 1306, or at such other location as Agent may designate from time to time by notice to the Borrowers and Lenders.

 

Agent’s Special Counsel”:  Shearman & Sterling LLP or such other counsel as selected by Agent.

 

Aggregate Credit Exposure”: The aggregate Revolving Credit Exposure and Term Loan Exposure of all Lenders.

 

Agreement”: This Credit Agreement, as the same may be amended, modified, supplemented and/or extended from time to time, including the Schedules and Exhibits hereto.

 

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Agreement Regarding Fees”: Any separate letter agreement executed and delivered by Parent Borrower or an Affiliate of Parent Borrower and to which Agent or an Arranger is a party, as the same may be amended, restated or replaced from time to time.

 

Allocable Principal Balance”:  See §37(b).

 

Anti-Corruption Laws”:All  laws,  rules,  and  regulations  of  any  jurisdiction  applicable to any Borrower or its Subsidiaries from time to time concerning or relating to bribery or corruption.

 

Applicable Contribution”:  See §37(d).

 

Applicable Lender”: With respect to (a) the Revolving Credit Facility, a Revolving Credit Lender  and (b) the Term Loan Facility, a Term Loan Lender.

 

Applicable Margin”: (a) The Applicable Margin for LIBOR Rate Loans and Base Rate Loans shall, subject to the last sentence of this paragraph, be as set forth below based on the Consolidated Leverage Ratio  as set forth in the most recent Compliance Certificate pursuant to §7.4(c):

 

 

 

 

Pricing Level

 

 

Consolidated Leverage Ratio

Revolving Credit LIBOR

Rate Loans

 

Revolving Credit Base Rate Loans

 

Term LIBOR

Rate Loans

 

 

Term Base Rate Loans

Pricing Level 1

Less than 40%

1.35%

0.35%

1.30%

0.30%

Pricing Level 2

Greater than or equal to 40% but less than 45%

1.40%

0.40%

1.35%

 

0.35%

Pricing Level 3

Greater than or equal to 45% but less than 50%

1.50%

0.50%

1.45%

 

0.45%

Pricing Level 4

Greater than or equal to 50% but less than 55%

1.60%

0.60%

1.55%

 

0.55%

Pricing Level 5

Greater than or equal to 55% but less than or equal to 60%

1.90%

0.90%

1.90%

 

0.90%

Pricing Level 6

Greater than 60%

2.20%

1.20%

2.20%

1.20%

 

The Applicable Margin shall not be adjusted based upon such Consolidated Leverage Ratio, if at all, until (i) the first day of the next fiscal quarter following receipt of any updated Compliance Certificate or (ii) if any member of the Consolidated Group issues Equity Interests, the second Business Day following Agent’s receipt of a pro forma Compliance Certificate that takes into account such issuance of Equity Interests and any repayment of Indebtedness from the proceeds thereof. In the event that Parent Borrower shall fail to deliver to Agent a quarterly Compliance Certificate on or before the date required by §7.4(c), then without   limiting any

other rights of Agent and Lenders under this Agreement, the Applicable Margin for Revolving Credit Loans shall be at Pricing Level 6 commencing on the first (1st) Business Day following the date on which such

Compliance Certificate was required to have been delivered and shall remain in effect until such failure is cured, in which event the Applicable Margin shall adjust, if necessary, on the first (1st) day of the first (1st) month following receipt of such Compliance Certificate.  The Applicable Rate in effect from the Closing  Date

through the date of the next change in the Applicable Rate pursuant to the provisions hereof shall be determined based upon Pricing Level 3. The provisions of this definition shall be subject to §2.6(e).

 

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(b) In the event that Parent Guarantor achieves an Investment Grade Rating, Parent Borrower may, upon written notice to Agent, make an irrevocable (subject to the provisions of the paragraph following the  grid below) written election (setting forth the date such election shall be effective) to exclusively use the ratings-based pricing grid set forth below (a “Ratings Grid Election”), in which case the Applicable Margin for Eurodollar Rate Advances and Base Rate Advances will be determined, as per the pricing grid below, on the basis of the Debt Rating of Parent Guarantor as set forth below:

 

 

 

 

Debt Rating

 

 

Revolving Credit LIBOR Rate Loans

Revolving Credit Base Rate Loans

 

 

 

Facility Fee

Term LIBOR

Rate Loans

Term Base Rate Loans

>A-/A3

0.85%

0.00%

0.125%

0.90%

0.00%

BBB+/Baa1

0.90%

0.00%

0.15%

0.95%

0.00%

BBB/Baa2

1.00%

0.00%

0.20%

1.10%

0.10%

BBB-/Baa3

1.20%

0.20%

0.25%

1.35%

0.35%

<BBB-/Baa3

1.55%

0.55%

0.30%

1.75%

0.75%

 

If Parent Borrower has made the Ratings Grid Election as provided above but thereafter Parent Guarantor fails to maintain an Investment Grade Rating by at least one of S&P or Moody’s, then the applicable interest rate margin shall be determined pursuant to clause (a) above during the period commencing on the date Parent Guarantor no longer has an Investment Grade Rating by at least one of S&P or Moody’s and ending on the date Parent Borrower makes another Ratings Grid Election.

 

Approved Fund”: Any Fund that is administered or managed by (a) a Lender, or (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

 

Arrangers”:  As defined in the recital of parties hereto.

 

Assignment and Acceptance Agreement”:  See §18.1.

 

Authorized Officer”: Any of the following Persons: Scott F. Schaeffer, Farrell M. Ender, James J. Sebra and Jessica K. Norman, and such other Persons as Parent Borrower shall designate in a written notice to Agent.

 

Bail-In Action”: The exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

 

Bail-In Legislation”: With respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the  implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

 

Balance Sheet Date”:  December 31, 2016.

 

Bankruptcy  Code”: Title  11,  U.S.C.A.,  as  amended  from time  to  time  or  any  successor  statute

thereto.

 

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Base Rate”: The greater of (a) the Applicable Margin for Revolving Credit Base Rate Loans or Term Base Rate Loans, as applicable, plus the greater of (i) the fluctuating annual rate of interest announced from time to time by Agent at Agent’s Head Office as its “prime rate”, or (ii) one half of one percent (0.50%) above the Federal Funds Effective Rate, or (b) the sum of LIBOR with an Interest Period of one (1) month based on the then applicable LIBOR determined for such Interest Period) plus the then Applicable Margin for Revolving Credit LIBOR Rate Loans or Term LIBOR Rate Loans, as applicable; provided, however, that if the Base Rate shall be less than zero percent per annum, such rate shall be deemed to be zero percent per annum for purposes of this Agreement. The Base Rate is a reference rate and does not necessarily represent the lowest or best rate being charged to any customer. Any change in the rate of interest payable hereunder resulting from a change  in the Base Rate shall become effective as of the opening of business on the day on which such change in the Base Rate becomes effective, without notice or demand of any kind.

 

Base Rate Loans”: Collectively, the Revolving Credit Base Rate Loans, the Term Base Rate Loans, and the Swing Loans.

 

Bookrunners”:  As defined in the recital of parties hereto.

 

Borrower Information”:  See §2.6(g).

 

Borrowers”:   Collectively, Parent Borrower and the Subsidiary Borrowers, and individually any   of

them.

 

Breakage Costs”: The commercially reasonable cost to any Lender of re-employing funds bearing interest at LIBOR incurred (or reasonably expected to be incurred) in connection with (i) any payment of any portion of the Loans bearing interest at LIBOR prior to the termination of any applicable Interest Period, (ii) the conversion of a LIBOR Rate Loan to any other applicable interest rate on a date other than the last day of the relevant Interest Period, or (iii) the failure of a Borrower to draw down, on the first day of the applicable Interest Period, any amount as to which such Borrower has elected a LIBOR Rate Loan.

 

Building”: With respect to each Unencumbered Asset or parcel of Real Estate, all of the buildings, structures and improvements now or hereafter located thereon.

 

Business Day”: Any day on which banking institutions located in the same city and State as Agent’s Head Office are located are open for the transaction of banking business and, in the case of LIBOR Rate  Loans, which also is a LIBOR Business Day.

 

Capital Lease Obligations”: With respect to Parent Guarantor and its Subsidiaries for any period, the obligations of Parent Guarantor or any Subsidiary 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 liabilities on a balance sheet of Parent Guarantor and its Subsidiaries under GAAP and the amount of which obligations shall be the capitalized amount thereof determined in accordance with GAAP.

 

Capital Expenditure Reserve”: On an annual basis, an amount equal to $250.00 per unit for each Multifamily Property with respect to all Real Estate (as annualized for the applicable ownership period). If the term Capital Expenditure Reserve is used without reference to any specific Real Estate, then the amount shall be determined on an aggregate basis with respect to all Real Estate of the Borrowers and their Subsidiaries and a proportionate share equal to the Consolidated Group Pro Rata Share of all Real Estate of all Non-Wholly Owned Subsidiaries.

 

Capitalization Rate”:  Six percent (6.00%).

 

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Capitalized Lease”: A lease under which the discounted future rental payment obligations of the lessee or the obligor are required to be capitalized on the balance sheet of such Person in accordance with GAAP.

 

Cash Collateralize”: In respect of an Obligation of the Loan Parties in respect of the  Letters  of Credit, to provide and pledge (as a first priority perfected security interest) cash collateral in Dollars, or, if Agent and the applicable Issuing Lenders shall agree in their sole discretion, other credit support, in each case at a location and pursuant to documentation in form and substance satisfactory to Agent and the applicable Issuing Lenders (and “Cash Collateralization” has a corresponding meaning).

 

Cash Equivalents”: As of any date, (i) securities issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof), maturing not more than one year after the date of acquisition; (ii) time deposits in and certificates of deposit of any Eligible Bank; (iii) repurchase obligations with a term of not more than ninety (90) days for underlying securities of the types described in clause (i) above entered into with any Eligible Bank; (iv) direct obligations issued by any state of the United States or any political subdivision or  public instrumentality thereof; provided that such Investments mature, or are subject to tender at the option of the holder thereof, within three hundred sixty-five (365) days after the date of acquisition and, at the time of acquisition, have a rating of at least A from S&P or A-2 from Moody’s (or an equivalent rating by any other nationally recognized rating agency); (v) commercial paper of any Person other than an Affiliate of Parent Borrower; provided that such Investments have one of the two highest ratings obtainable from either S&P or Moody’s and mature within ninety (90) days after the date of acquisition; (vi) overnight and demand deposits in and bankers’ acceptances of any Eligible Bank and demand deposits in any bank or trust company to the extent insured by the Federal Deposit Insurance Corporation against the Bank Insurance Fund; and (vii) money market funds substantially all of the assets of which comprise Investments of the types described in clauses (i) through (vi) above.

 

CERCLA”: The Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. 9601 et seq.

 

CFTC Regulations”: Any and all regulations, rules, directives, or orders now or hereafter  promulgated or issued by the Commodity and Futures Trading Commission (including any successor thereto) relating to Derivatives Contracts.

 

Change in Law”: The occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or  treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided, that, notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (ii) 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 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.

 

Change of Control”:  The occurrence of any one of the following events:

 

(a)except with the written approval of Agent and Required Lenders (not to be unreasonably withheld, delayed, or conditioned), during any twelve (12) month period on or after the Closing Date, individuals who at the beginning of such period constituted the Board of Directors or Trustees of Parent Guarantor (the “Board”) (together with any new directors whose election by the Board or whose nomination  for election by the shareholders of IRT was approved by a vote of at least a majority of the members of the Board then in office who either were members of the Board at the beginning of such period or whose   election

(a)

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or nomination for election was previously so approved) cease for any reason (other than death or disability) to constitute a majority of the members of the Board then in office;

 

(b)any Person or group (as that term is used in Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules and regulations thereunder, but excluding any employee benefit plan of such Person or its subsidiaries, and any person or entity acting in its capacity as trustee, agent or other fiduciary or administrator of any such plan) shall have acquired beneficial ownership (within  the meaning of Rule 13d-3 under the Exchange Act) of a percentage (based on voting power, in the event different classes of stock shall have different voting powers) of the voting stock of Parent Guarantor equal to at least thirty percent (30%);

 

(c)Parent Guarantor consolidates with, is acquired by, or merges into or with any Person (other than a consolidation or merger in which IRT is the continuing or surviving entity);

 

(d)Parent Guarantor fails to own, directly or indirectly, seventy-five percent (75%) of the Equity Interests of Parent Borrower and be the sole general partner of Parent Borrower; or

 

(e)Parent Borrower fails to own, directly or indirectly, at least one hundred percent (100%) of  the economic, voting and beneficial interest of each Subsidiary Borrower, except, in each case, as expressly agreed upon in writing by Agent and Required Lenders in connection with the addition of any Unencumbered Asset subsequent to the Closing Date pursuant to §5.2.

 

Citibank”:  As defined in the preamble hereto.

 

Closing Date”: The first date on which all of the conditions set forth in §10 and §11 have been satisfied.

 

Code”:  The Internal Revenue Code of 1986, as amended.

 

Collateral Value”: With respect to the collateral for any Secured Recourse Indebtedness, the value of such collateral as calculated in a manner in all respects consistent with the valuation calculations set forth in  the definition of “Gross Asset Value”.

 

Commitment”: As to each Lender, the Revolving Credit Commitment and/or Term Loan Commitment of such Lender (or either of them, as the context requires).

 

Commitment Increase”: An increase in the Total Commitment to an amount not greater than Five Hundred Million Dollars ($500,000,000) pursuant to, and as further provided in, §2.11 or §2.13.

 

Commitment Increase Date”:  See §2.11(a).

 

Commitment Percentage”: As to each Lender, the ratio, expressed as a percentage, of (a) (i) the amount of such Lender’s Revolving Credit Commitment plus (ii) the amount of such Lender’s outstanding Term Loans to (b) (i) the Revolving Credit Commitments of all Lenders plus (iii) the sum of the outstanding Term Loans of all Lenders; provided, however, that if at the time of determination the Revolving Credit Commitments have been terminated or been reduced to zero, the “Commitment Percentage” of each Lender shall be the ratio, expressed as a percentage of (A) the sum of the unpaid principal amount of all Aggregate Credit Exposure of such Lender to (B) the sum of the aggregate unpaid principal amount of all outstanding Aggregate Credit Exposure of all Lenders as of such date.

 

Commodity Exchange Act”: The Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended and  in effect from time to time, or any successor law.

 

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Compliance Certificate”:  See §7.4(c).

 

Consent Request Date”:  See §27.

 

Consolidated”: With reference to any term defined herein, that term as applied to the accounts of a Person and its Subsidiaries, determined on a consolidated basis in accordance with GAAP.

 

Consolidated Asset Adjusted NOI”: On any date of determination, the Consolidated Asset NOI for the most recent fiscal quarter, annualized, less, with respect to Real Estate owned by any Person in the Consolidated Group, the Capital Expenditure Reserve, and, with respect to Real Estate owned by Non-Wholly Owned Subsidiaries, the Consolidated Group Pro Rata Share of the Capital Expenditure Reserve.

 

Consolidated Asset NOI”: As of any date of determination, on a consolidated basis for the Consolidated Group (a) with respect to any Real Estate owned by any Person in the Consolidated Group for any period, “property rental and other income” attributable to such Real Estate asset accruing for such period (including, without limitation, payments received from insurance on account of business or rental interruption and condemnation proceeds from any temporary use or occupancy) minus the amount of all expenses incurred in connection with and directly attributable to the ownership and operation of such Real Estate asset for such period, with such results being “grossed up” for any Real Estate not owned for the entire testing period, and (b) with respect to Real Estate owned by Non-Wholly Owned Subsidiaries for any period, the Consolidated Group Pro Rata Share of “property rental and other income” attributable to such Real Estate asset accruing for such period (including, without limitation, payments received from insurance on account of business or rental interruption and condemnation proceeds from any temporary use or occupancy) minus the amount of all expenses incurred in connection with and directly attributable to the ownership and operation of such Real Estate asset for such period, in each case including, without limitation, property management fees and amounts accrued for the payment of real estate taxes and insurance premiums, but excluding Interest Expense or other debt service charges and any non-cash charges such as depreciation or amortization of financing costs plus acquisition costs for consummated acquisitions.

 

Consolidated EBITDA”: As of any date of determination with respect to the Consolidated Group for any period, without duplication, Consolidated Net Income determined in accordance with GAAP (before minority interests) for such period, calculated without regard to gains or losses on early retirement of debt or debt restructuring, debt modification charges, and prepayment premiums, plus (x) the following to the extent deducted in computing such net income or loss for such period: (i) Interest Expense for such period, (ii) extraordinary or nonrecurring losses attributable to the sale or other disposition of assets or debt restructurings in such period, (iii) depreciation and amortization for such period, (iv) acquisition costs related to the acquisition of Real Estate that were capitalized prior to FAS 141-R which do not represent a recurring cash item in such period or in any future period and (v) other non-cash or non-recurring expenses for such period; and minus (y) extraordinary or nonrecurring gains attributable to the sale or other disposition of assets in such period; it being understood that the Consolidated Group’s pro rata share of the items comprising Consolidated EBITDA of any partially-owned entity will be included in Consolidated EBITDA, calculated in a manner consistent with the above described treatment for the Consolidated Group.

 

Consolidated Fixed Charge Coverage Ratio”: As of any date of determination for each fiscal quarter of Parent Guarantor and its Subsidiaries most recently ended, the ratio of Adjusted EBITDA to Fixed Charges.

 

Consolidated Group”: The Guarantors, the Borrowers and all Subsidiaries which are required to be consolidated with them for financial reporting purposes under GAAP.

 

Consolidated Group Pro Rata Share”: With respect to any Non-Wholly Owned Subsidiary, the percentage interest held by the Consolidated Group, in the aggregate, in such Non-Wholly Owned Subsidiary as determined by calculating the greater of (i) the percentage of the issued and outstanding Equity Interests in such Non-Wholly Owned Subsidiary held by the Consolidated Group in the aggregate (in relation to the   total

 

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aggregate amount of issued and outstanding Equity Interests in such Non-Wholly Owned Subsidiary), notwithstanding any provision of GAAP to the contrary and (ii) the percentage of the total book value of such Non-Wholly Owned Subsidiary that would be received by the Consolidated Group in the aggregate, upon liquidation of such Non-Wholly Owned Subsidiary, after repayment in full of all Indebtedness of such Non- Wholly Owned Subsidiary.

 

Consolidated Leverage Ratio”: As of any date of determination, Total Indebtedness divided by Gross Asset Value, expressed as a percentage.

 

Consolidated Net Income”: For any period, the sum, without duplication, of (i) net earnings (or loss) after taxes of the Consolidated Group (adjusted by eliminating any such earnings or loss attributable to Non- Wholly Owned Subsidiaries) plus (ii) the applicable Consolidated Group Pro Rata Share of net earnings (or loss) of all Non-Wholly Owned Subsidiaries for such period, in each case determined in accordance with GAAP (calculated without regard to gains or losses on early retirement of debt or debt restructuring, debt modification charges, and prepayment premiums).

 

Consolidated Tangible Net Worth”:  At any time, the Consolidated Group’s Gross Asset Value minus

Total Indebtedness.

 

Contribution”:  See §37(b).

 

Construction in Process”: Any Real Estate asset owned by a Borrower which is raw land, vacant out- parcels, or other property on which construction of material improvements has commenced and is continuing  to be performed (such commencement evidenced by foundation excavation) without undue delay from permit denial, construction delays or otherwise, but has not yet been completed (as evidenced by a certificate of occupancy permitting use of such property by the general public). A Real Estate asset will no longer be considered Construction in Process upon the sooner of (a) achievement of eighty percent (80%) occupancy pursuant to executed Leases in full force and effect or (b) twelve (12) months after substantial completion of construction of the improvements.

 

Conversion/Continuation Request”: A notice given by the Borrowers to Agent of their election to convert or continue a Loan in accordance with §4.1.

 

Debt Investment”: Any real estate related loan to a third party, including but not limited to (a) loans secured by a mortgage or deed of trust or similar security instrument, (b) mezzanine loans, and (c) B-Notes.

 

Debt Rating”: As of any date, with respect to either Moody’s or S&P, the most recent credit rating assigned to the senior, unsecured, non-credit enhanced, long-term debt of Parent Guarantor issued by such rating agency prior to such date; provided, however, that (a) if the Debt Ratings issued by Moody’s and S&P differ and such difference is less than two levels, the higher of such Debt Ratings shall apply and (b) if the  Debt Ratings issued by Moody’s and S&P differ and such difference is two or more levels, the Debt Rating  one level below the higher of such Debt Ratings shall apply. At any time, if either of Moody’s or S&P shall no longer perform the functions of a securities rating agency, then (x) Parent Borrower and Agent shall promptly negotiate in good faith to agree upon a substitute rating agency or agencies (and to correlate the system of ratings of each substitute rating agency with that of the rating agency being replaced), and (y) pending such amendment, (i) the Debt Rating of the other of rating agency described herein, if one has been provided, shall continue to apply and (ii) if such Debt Rating is one of the ratings identified in the definition of “Investment Grade Rating”, then Parent Guarantor will be deemed to have achieved an Investment Grade Rating during such time.

 

Default”:  See §12.1.

 

Default Rate”:  See §4.12.

 

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Defaulting Borrower”:  See §37(c).

 

Defaulting Lender”: Any Lender that (a) has failed to perform any of its funding obligations hereunder, including in respect of its Loans or participations in respect of Letters of Credit or Swing Loans, within three (3) Business Days of the date required to be funded by it hereunder, unless such Lender is contesting its obligation to fund such amount in good faith, provided that if such Lender is the only Lender contesting its obligation to fund, such Lender shall be deemed to be a Defaulting Lender hereunder if such contest is not resolved within ninety (90) days, (b) has notified the Borrower, or 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 or under other agreements in which it has extended credit, (c) has failed, within three Business Days after request by Agent, to confirm in a manner reasonably satisfactory to Agent that it will comply with its funding obligations, unless such Lender is contesting its obligation to fund in good faith, provided that if such Lender is the only Lender contesting its obligation to fund, such Lender shall be deemed to be a Defaulting Lender hereunder if such contest is not resolved within ninety (90) days, (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any bankruptcy or  other 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, (iii) taken any action in furtherance of, or indicated its consent to, approval of or acquiescence in any such proceeding or appointment or (iv) has become the subject of a Bail-In Action; 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.

 

Defaulting Revolving Credit Lender”: Any Defaulting Lender which is a Revolving Credit Lender.

 

Derivatives Contract”: Any and all rate swap transactions, basis swaps, credit  derivative  transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross- currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement. Not in limitation of the foregoing, the term “Derivatives Contract” includes any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement, including any such obligations or liabilities under any such master agreement.

 

Directions”:  See §14.14.

 

Disqualifying Environmental Event”: With respect to any Unencumbered Asset or any Potential Unencumbered Asset, any release of Hazardous Substances, any violation of Environmental Laws or any other similar environmental event with respect to such Real Estate that could reasonably be expected to cost in excess of $1,000,000.00 to remediate or, which, with respect to all of the Unencumbered Assets (including  such Unencumbered Asset or Potential Unencumbered Asset), could reasonably be expected to cost in excess of $5,000,000.00 in the aggregate to remediate; provided, however, the Borrowers shall have one hundred twenty (120) days to remediate any such release of Hazardous Substances, violation of Environmental Laws or any other similar environmental event before such release of Hazardous Substances, violation  of Environmental Laws or any other similar environmental event shall be deemed a Disqualifying Environmental Event; provided further that, subject to Agent’s consent, the Borrowers shall have an additional sixty (60) days to conduct such remediation if the Borrowers are using good faith efforts to complete such remediation.

 

Disqualifying Structural Event”: With respect to any Unencumbered Asset or any Potential Unencumbered Asset, any structural issue or architectural deficiency which, with respect to such Real   Estate,

 

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could reasonably be expected to cost in excess of $2,500,000.00 to remediate or, which, with respect to all of the Unencumbered Assets (including such Unencumbered Asset or Potential Unencumbered Asset), could reasonably be expected to cost in excess of $5,000,000.00 in the aggregate to remediate.

 

Disqualified Lender”:  Any Person or Persons listed on Schedule 1.1-A hereto.

 

Distribution”: Any (a) dividend or other distribution, direct or indirect, on account of any Equity Interest of a Loan Party, now or hereafter outstanding, except a dividend or other distribution payable solely in Equity Interest to the holders of that class; (b) redemption, conversion, exchange, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any Equity Interest of a Loan Party now or hereafter outstanding; and (c) payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire any Equity Interests of a Loan Party now or hereafter outstanding.

 

Documentation Agents”:  As defined in the preamble hereto.

 

Dollarsor $”:  Dollars in lawful currency of the United States of America.

 

Domestic Lending Office”: Initially, the office of each Lender designated as such on Schedule 1.1 hereto; thereafter, such other office of such Lender, if any, located within the United States that will be making or maintaining Base Rate Loans.

 

Drawdown Date”: The date on which any Loan is made or is to be made (which shall be the Closing Date with respect to the initial Term Loans), and the date on which any Loan which is made prior to the applicable Maturity Date, is converted in accordance with §4.1.

 

EEA Financial Institution”: (a) Any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

 

EEA Member Country”: Any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

 

EEA Resolution Authority”: Any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

 

Eligible Assignee”: (a) A Lender; (b) an Affiliate of a Lender; (c) an Approved Fund, and (d) any other Person (other than a natural person) approved by (i) Agent, and (ii) unless an Event of Default has occurred and is continuing, the Borrowers (each such approval not to be unreasonably withheld or delayed); provided that notwithstanding the foregoing, “Eligible Assignee” shall not include (x) any Borrower or any of the Borrowers’ or the Guarantors’ Affiliates or Subsidiaries and (y) so long as no payment or  bankruptcy related Event of Default shall have occurred and is continuing, any Disqualified Lender.

 

Eligible Bank”: A bank or trust company that (x) (i) is organized and existing under the laws of the United States of America, or any state, territory or possession thereof, (ii) as of the time of the making or acquisition of an Investment  in such bank or  trust  company,  has  combined capital and surplus  in excess   of

$500.0 million, and (iii) the senior Indebtedness of such bank or trust company is rated at least “A-2” by Moody’s or at least “A” by S&P, or (y) is a Lender.

 

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Environmental Laws”: All applicable present or future federal, state, county and local laws, by-laws, rules, regulations, codes and ordinances, or any judicial or administrative interpretations thereof, and the requirements of any governmental agency or authority having jurisdiction with respect thereto, applicable to pollution, the regulation or protection of the environment, the health and safety of persons and property (with respect to exposure to Hazardous Substances) and shall include, but not be limited to, all orders, decrees, judgments and rulings imposed through any public or private enforcement proceedings, relating to the existence, use, discharge, release, containment, transportation, generation, storage, management or disposal of Hazardous Substances relating to the applicable Real Estate, or otherwise regulating or providing for the protection of the environment applicable to such Real Estate and relating to Hazardous Substances or to the existence, use, discharge, release or disposal thereof. Environmental Laws include, but are not limited to, the following laws: Comprehensive Environmental Response Compensation and Liability Act (42 U.S.C. §9601  et seq.), the Hazardous Materials Transportation Act (49 U.S.C. §5101 et seq.), the Public Health Service Act (42 U.S.C. §300(f) et seq.), the Pollution Prevention Act (42 U.S.C. §13101 et seq.), the Federal Insecticide, Fungicide and Rodenticide  Act  (7  U.S.C.  §136  et  seq.),  the Resource Conservation and Recovery  Act (42

U.S.C. §6901 et seq.), the Federal Clean Water Act (33 U.S.C. §1251 et seq.), the Federal Clean Air Act (42

U.S.C. §7401 et seq.), and the applicable laws and regulations of each State in which any Real Estate is  located.

 

Equity Interests”: With respect to any Person, any share of capital stock of (or other ownership or profit interests in) such Person, any warrant, option or other right for the purchase or other acquisition from such Person of any share of capital stock of (or other ownership or profit interests in) such Person, any security convertible into or exchangeable for any share of capital stock of (or other ownership or  profit interests in)  such Person or warrant, right or option for the purchase or other acquisition from such Person of such shares  (or such other interests), and any other ownership or profit interest in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or nonvoting.

 

ERISA”: The Employee Retirement Income Security Act of 1974, as amended and in effect from time to time.

 

ERISA Affiliate”: Any Person that is subject to ERISA and is treated as a single employer  with Parent Borrower or its Subsidiaries under §414 of the Code.

 

ERISA Reportable Event”: A reportable event with respect to a Guaranteed Pension Plan within the meaning of §4043 of ERISA and the regulations promulgated thereunder as to which the requirement of notice has not been waived.

 

EU Bail-In Legislation Schedule”: The EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

 

Event of Default”:  See §12.1.

 

Excess Refinanced Principal Amount”:  See definition of Permitted Refinancing Indebtedness.

 

Excluded Swap Obligation”: With respect to any Loan Party, any Hedge Obligation of another Loan Party as to which such Loan Party is jointly and severally or otherwise liable (as a Borrower or as a Guarantor) pursuant to the terms of this Agreement or any other Loan Document if, and to the extent that, the incurrence  of Obligations by such Loan Party in respect of such Hedge Obligation is or becomes illegal under the Commodity Exchange Act (or the application or official interpretation thereof, including under any applicable CFTC Regulation) by virtue of such Loan Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to any “keepwell,” support or other agreement for the benefit of such Loan Party and any and all guarantees of, or other credit support for, any Hedge Obligation provided by other Loan Parties as further provided in §7.21 at the time such Loan Party becomes jointly and severally or otherwise liable with respect to such Hedge Obligation or grants a

 

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security interest to secure same. If a Hedge Obligation arises under a Derivatives Contract governing more  than one Hedge Obligation, such exclusion shall apply only to the portion of such Hedge Obligation that is attributable to a Derivatives Contract for which such Hedge Obligation or security interest becomes illegal.

 

Existing Credit Agreement”: That certain Credit Agreement dated as of September 17, 2015, as amended through the Closing Date, among Parent Borrower, KeyBank National Association, as administrative agent, the other lenders and the Borrowers party thereto, The Huntington National Bank, as syndication agent and KeyBanc Capital Markets and The Huntington National Bank, as arrangers.

 

Extension Request”:  See §2.12(a).

 

Facility”: Collectively, the credit facilities described herein with respect to the Loans up to the Maximum Facility Amount and individually, the Revolving Credit Facility or the Term Loan Facility, as the context may require.

 

Facility Available Amount”:  At any time of determination with respect to any Loans or extensions  of credit, the maximum principal amount which would not cause (a) the Outstanding Term Loans, Outstanding Revolving Credit Loans, Outstanding Swing Loans and Letter of Credit Liabilities to exceed the applicable Commitments at such time or (b) the Loan Parties to fail to be in compliance with the Unencumbered Asset Financial Covenants on a Pro Forma Basis immediately after giving effect to the applicable Loans or extensions of credit.

 

Facility Fee”:  See §2.3(b).

 

FATCA”: Sections 1471 through 1474 of the Code, as of the date of this Agreement (or  any  amended or successor version that is substantively comparable), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b) of the Code and any legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the foregoing.

 

Federal Funds Effective Rate”: For any day, the rate per annum (rounded upward to the nearest one- hundredth of one percent (1/100 of 1%)) announced by the Federal Reserve Bank of New York on such day as being the weighted average of the rates on overnight federal funds transactions arranged by federal funds brokers on the previous trading day, as computed and announced by such Federal Reserve Bank in substantially the same manner as such Federal Reserve Bank computes and announces the weighted average it refers to as the “Federal Funds Effective Rate”; provided that if the Federal Funds Effective Rate shall be less than zero percent per annum, such rate shall be deemed to be zero percent per annum for purposes of this Agreement.

 

Fixed Charges”: For any period for the Consolidated Group, the sum of (a) Interest Expense and (b) the aggregate of all regularly scheduled principal payments on Indebtedness (but excluding (i) balloon payments of principal due upon the stated maturity of any Indebtedness and (ii) payments of principal outstanding under the Facility) of such the Consolidated Group made or required to be made during such period, measured on a Consolidated basis, and (c) the aggregate of all dividends payable on the preferred Equity Interests of a member of the Consolidated Group (excluding, for the avoidance of doubt, any dividends payable by one member of the Consolidated Group to another member of the Consolidated Group); in each instance Fixed Charges shall include such Person’s Consolidated Group Pro Rata Share of Fixed Charges attributable to any Non-Wholly Owned Subsidiary.

 

Fronting Exposure”: At any time there is a Defaulting Lender, (a) with respect to the Issuing  Lenders, such Defaulting Lender’s Revolving Credit Commitment Percentage of the outstanding Letter of Credit Liabilities other than Letter of Credit Liabilities as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or cash collateralized in accordance with the terms hereof, and

 

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(b) with respect to the Swing Loan Lenders, such Defaulting Lender’s Revolving Credit Commitment Percentage of Swing Loans other than Swing Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or cash collateralized in accordance with the terms hereof.

 

Fund”: Any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of  its activities.

 

Funding Borrower”:  See §37(b).

 

Funds from Operations”: As of any date of determination means,  with respect to Consolidated  Group and for a given period, (a) net income (or loss) of Consolidated Group determined on a Consolidated basis for such period, minus (or plus) (b) gains (or losses) from debt restructuring, mark-to-market adjustments on interest rate swaps, and sales of property during such period, plus (c) depreciation with respect to Consolidated Group’s real estate assets and amortization (other than amortization of deferred financing costs) of Consolidated Group for such period, in each case after adjustments to reflect the Consolidated Group Pro Rata Share in Non-Wholly Owned Subsidiaries, plus (d) all non-cash charges related to deferred financing costs and deferred acquisition costs, plus (e) charges related to equity compensation and acquisition costs, plus

 

(f)

other one-time charges.

 

GAAP”:  Generally accepted accounting principles consistently applied.

 

Governmental Authority”: The government of the United States or any other nation, or of 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 (including any supra-national bodies such as the European Union or the European Central Bank).

 

Gross Asset Value”: As of the date of  determination for  the Consolidated Group, the sum of  (without duplication with respect to any Real Estate):

 

 

(a)

Total Consolidated Operating Property Value; plus

 

 

(b)

the cost basis of Construction in Process; plus

 

 

(c)

the cost basis of Unimproved Land; plus

 

 

(d)

Debt Investments (based on current book value); plus

 

 

(e)

the aggregate amount of all Unrestricted Cash and Cash Equivalents.

 

Gross Asset Value shall be adjusted, as appropriate, for acquisitions, dispositions and other changes to the portfolio during the calendar quarter most recently ended prior to a date of determination. All income, expense and value associated with assets included in Gross Asset Value disposed of during the calendar  quarter period most recently ended prior to a date of determination will be eliminated from calculations. Gross Asset Value will be adjusted to include an amount equal to each member of the Consolidated Group’s Consolidated Group Pro Rata Share of the Gross Asset Value attributable to any of the items listed above in this definition owned by a Non-Wholly Owned Subsidiary; provided, however, for purposes of this definition, such Consolidated Group Pro Rata Share with respect to partially-owned entities shall be measured at the greater of (x) such Person’s economic interest in such Non-Wholly Owned Subsidiary or (y) the percentage of Indebtedness guaranteed by such Person relating to such Non-Wholly Owned Subsidiary; provided further that

(a) to the extent that the Gross Asset Value attributable to (i) Unimproved Land, (ii) Construction in Process,

(iii) Joint Ventures and (iv) Other Real Estate Investments exceeds in the aggregate 20% of Gross Asset Value,

 

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such excess shall be disregarded for purposes of calculating Gross Asset Value and (b) the Gross Asset Value attributable to Real Estate subject to a Ground Lease may be subject to an adjustment reasonably satisfactory  to Agent.

 

Ground Lease”: With respect to any Real Estate, a ground lease containing the following terms and conditions: (a) a remaining term (including any unexercised extension options that the lessee can unilaterally exercise without the need to obtain the consent of the lessor or to pay the lessor any amount as a condition to the effectiveness of such extension) of fifteen (15) years or more from the Closing Date; (b) the right of the lessee to mortgage and encumber its interest in the leased property without the consent of the lessor; (c) the obligation of the lessor to give the holder of any mortgage Lien on such leased property written notice of any defaults on the part of the lessee and agreement of such lessor that such lease will not be terminated until such holder has had a reasonable opportunity to cure or complete foreclosures, and fails to do so; (d) reasonable transferability of the lessee’s interest under such lease, including ability to sublease; and (e) such other rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold estate demised pursuant to a ground lease.

 

Guarantors”: Collectively, (a) Parent Guarantor and (b) any other Person who subsequently provides a Guaranty.

 

Guaranty”: The guaranty of each Guarantor in favor of Agent and Lenders of certain of the Obligations of the Borrowers hereunder.

 

Hazardous Substances”: The following substances in concentrations that violate or are regulated by Environmental Laws: (i) asbestos, flammable materials, explosives, radioactive or nuclear substances, polychlorinated biphenyls, other carcinogens, oil and other petroleum products, radon gas, urea formaldehyde;

(ii)chemicals, gases, solvents, pollutants or contaminants that pose an imminent or substantial danger to the environment or to the health or safety of any person; and (iii) any other hazardous or toxic materials, wastes  and substances which are defined, determined or identified as such in any present or future federal, state or local laws, rules, regulations, codes or ordinances or any judicial or administrative interpretation thereof in concentrations which violate Environmental Laws.

 

Hedge Obligations”: As may be applicable at any time, all obligations of the Borrowers to any  Lender Hedge Provider to make any payments (including termination payments) under any Derivatives Contract with respect to an interest rate swap, collar, or floor or a forward rate agreement or other agreement regarding the hedging of interest rate risk exposure (other than any interest rate “cap”), and any confirming letter executed pursuant to such hedging agreement, all as amended, restated or otherwise modified.

 

Impacted Interest Period”:  See definition of LIBOR.

 

Implied Unsecured Debt Service”: As of any date of determination, the hypothetical  annual  payments of principal and interest on a loan equal to (a) the aggregate outstanding amount of all Unsecured Indebtedness (including the aggregate undrawn face amount of issued letters of credit) amortizing based on a thirty (30) year, mortgage-style principal amortization schedule at an interest rate per annum equal to the greatest of (i) the then applicable ten (10) year Treasury Bill yield plus two hundred (200) basis points, (ii) five and one half percent (5.50%), and (iii) the actual interest rate under the Facility as of the last day of the most recent calendar quarter.

 

Increase Notice”:  See §2.11(a).

 

Incremental Term Loan Amendment”:  See §2.13(c).

 

Incremental Term Loan Date”:  See §2.13(a).

 

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Incremental Term Loan Facility”:  See §2.13(a).

 

Incremental Term Loan Maturity Date”:  See §2.13(a).

 

Indebtedness”: With respect to any Person at the time of computation thereof, all of the following (without duplication): (a) all indebtedness of such Person for borrowed money including, without limitation, any repurchase obligation or liability of such Person with respect to securities, accounts or notes receivable  sold by such Person that becomes a liability on the balance sheet of such Person, (b) all obligations of such Person for the deferred purchase price of property or services (other than current trade liability incurred in the ordinary course of business and payable in accordance with customary practices), to the extent such  obligations constitutes indebtedness for the purposes of GAAP, (c) any other indebtedness of such Person which is evidenced by a note, bond, debenture, or similar instrument, (d) all Capitalized Lease Obligations, (e) all Indebtedness of other Persons which such Person has guaranteed or is otherwise recourse to such Person (except for guaranties of customary exceptions for fraud, misapplication of funds, environmental indemnities, violation of “special purpose entity” covenants, and other similar exceptions to recourse liability until a written claim is made with respect thereto, and then shall be included only to the extent of the amount of such claim), including liability of a general partner in respect of liabilities of a partnership in which it is a general partner which would constitute Indebtedness hereunder, (f) any obligation to supply funds to or in any  manner  to invest directly or indirectly in a Person, to maintain working capital or equity capital of a Person or otherwise  to maintain net worth, solvency or other financial condition of a Person, to purchase indebtedness, or to assure the owner of indebtedness against loss, including, without limitation, through an agreement to purchase property, securities, goods, supplies or services for the purpose of enabling the debtor to make payment of the indebtedness held by such owner or otherwise (excluding in any calculation of Total Indebtedness of Parent Borrower, any Guarantor and their subsidiaries, guaranty obligations of Parent Borrower, any Guarantor or their subsidiaries in respect of primary obligations of any of Parent Borrower, any Guarantor or their subsidiaries which are already included in Total Indebtedness), (g) all reimbursement obligations of such Person for letters of credit and other contingent liabilities, (h) any net mark-to-market exposure under a derivatives contract to the extent speculative in nature and (i) all liabilities secured by any lien (other than liens for taxes not yet due and payable) on any property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof. Indebtedness shall be calculated on a consolidated basis in accordance with GAAP (unless otherwise indicated herein), and including (without duplication) the Consolidated Group Pro Rata Share of Indebtedness for the Borrowers’ Non-Wholly Owned Subsidiaries.

 

Indemnified Person”:  See §16.

 

Intercompany Note”: A promissory note in form and substance reasonably satisfactory to Agent.

 

Interest Expense”: For any period for the Consolidated Group, all paid, accrued or  capitalized interest expense on the Indebtedness of the Consolidated Group (whether direct, indirect or contingent, and including, without limitation, interest on all convertible debt but excluding amortization of financing costs). This definition will include the Consolidated Group Pro Rata Share of Interest Expense attributable to Non- Wholly Owned Subsidiaries.

 

Interest Payment Date”: (a) during such time as a Loan is a Base Rate Loan, the last day of each March, June, September and December and on the date such Base Rate Advance shall be converted to a LIBOR Rate Loan or paid in full, (b) during such time as a Loan is a LIBOR Rate Loan, the last day of the applicable Interest Period and, if such Interest Period has a duration of more than three months, on each day that occurs during such Interest Period every three months from the first day of such Interest Period and on the date such LIBOR Rate Loan shall be converted to a Base Rate Loan or paid in full; provided, however, that in each case, if such date is not a Business Day, then the Interest Payment Date shall be the next succeeding Business Day.

 

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Interest Period”: With respect to each LIBOR Rate Loan (a) initially, the period commencing on the Drawdown Date of such LIBOR Rate Loan and ending one, two, three or six months thereafter and (b) thereafter, each period commencing on the day following the last day of the next preceding Interest Period applicable to such Loan and ending on the last day of one of the periods set forth above, as selected by the Borrowers in a Loan Request or Conversion/Continuation Request; provided that all of the foregoing  provisions relating to Interest Periods are subject to the following:

 

(i)if any Interest Period with respect to a LIBOR Rate Loan would otherwise end on a day that  is not a LIBOR Business Day, such Interest Period shall end on the next succeeding LIBOR Business Day, unless such next succeeding LIBOR Business Day occurs in the next calendar month, in which case such Interest Period shall end on the next preceding LIBOR Business Day, as determined conclusively by Agent in accordance with the then current bank practice in London, England;

 

(ii)if the Borrowers shall fail to give notice as provided in §4.1(a), the Borrowers shall be deemed to have requested a continuation of the affected LIBOR Rate Loan as a LIBOR Rate Loan for an interest period of one month on the last day of the then current Interest Period with respect thereto as provided in and subject to the terms of §4.1(c);

 

(iii)any Interest Period pertaining to a LIBOR Rate Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the applicable calendar month; and

 

(iv)no Interest Period relating to any LIBOR Rate Loan shall extend beyond the applicable Maturity Date.

 

Interpolated Rate”: At any time, for any Interest Period, the rate per annum (rounded to the same number of decimal places as LIBOR) determined by 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) LIBOR for the longest period for which LIBOR is available that is shorter than the Impacted Interest Period; and (b) the LIBOR for the shortest period for which that LIBOR is available that exceeds the Impacted Interest Period, in each case, at such time.

 

Investment Grade Rating”: A Debt Rating of BBB- or better from S&P or a Debt Rating of Baa3 or better from Moody’s.

 

Investments”: With respect to any Person, all shares of capital stock, evidences of Indebtedness and other securities issued by any other Person and owned by such Person, all loans, advances, or extensions of  credit to, or contributions to the capital of, any other Person, all purchases of the securities or business or integral part of the business of any other Person and all interests in Real Estate, and all other investments; provided, however, that the term “Investment” shall not include (i) equipment, inventory and other tangible personal property acquired in the ordinary course of business, or (ii) current trade and customer accounts receivable for services rendered in the ordinary course of business and payable in accordance with customary trade terms. In determining the aggregate amount of Investments outstanding at any particular time: (a) there shall be deducted in respect of each Investment any amount received as a return of capital; (b) there shall not  be deducted in respect of any Investment any amounts received as earnings on such Investment, whether as dividends, interest or otherwise; and (c) there shall not be deducted (or added) in respect of any Investment any decrease (or increase) in the value thereof.

 

IR OpCo”: IR TS Op Co, LLC a Delaware limited liability company, as successor by conversion to Trade Street Operating Partnership, L.P., a Delaware limited partnership.

 

IRT”: Independence Realty Trust, Inc., a Maryland corporation, and its successors and assigns.

 

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Issuing Lenders”: KeyBank and Citibank, each in its capacity as a Lender issuing the Letters of Credit and any successors thereto.

 

Joinder Agreement”: The Joinder Agreement with respect to this Agreement and the Notes to be executed and delivered pursuant to §5.6 by any Additional Subsidiary Borrower, such Joinder Agreement to be substantially in the form of Exhibit C hereto.

 

KeyBank”:  As defined in the preamble hereto.

 

LC Account Collateral”:  See §4.16(a).

 

LC Cash Collateral Account”:  An account of the Borrowers to be maintained with Agent, in the  name of one or more Borrowers but under the sole control and dominion of Agent and subject to the terms of this Agreement.

 

LC Disbursement”:  A payment made by Agent pursuant to a Letter of Credit.

 

LC Exposure”: At any time, the difference between (a) the sum of (i) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (ii) the aggregate amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrowers at such time and (b) all amounts then on deposit in the LC Cash Collateral Account. The LC Exposure of any Revolving Credit Lender at any time shall be its applicable Revolving Credit Commitment Percentage of the total LC Exposure at such time.

 

Leases”:  Leases, licenses and agreements, whether written or oral, relating to the use or occupation  of space in any Building or of any Real Estate.

 

Legal Requirements”: Shall mean all applicable federal, state, county and local laws, rules, regulations, codes and ordinances, and the requirements in each case of any governmental agency or authority having or claiming jurisdiction with respect thereto, including, but not limited to, those applicable to zoning, subdivision, building, health, fire, safety, sanitation, the protection of the handicapped, and environmental matters and shall also include all orders and directives of any court, governmental agency or authority having  or claiming jurisdiction with respect thereto.

 

Lenders”: KeyBank, Citibank, the other lending institutions which are party hereto and any other Person which becomes an assignee of any rights of a Lender pursuant to §18 (but not including any participant as described in §18); and collectively, the Revolving Credit Lenders, the Term Loan Lenders, and the Swing Loan Lenders. The Issuing Lenders shall be Revolving Credit Lenders, as applicable.

 

Lender Hedge Provider”: As may be applicable at any time with respect to any Hedge Obligations, any counterparty thereto that, at the time the applicable hedge agreement was entered into, was a Lender or an Affiliate of a Lender.

 

Letter of Credit”: Any standby letter of credit issued at the request of the Borrowers and for the account of the Borrowers in accordance with §2.10.

 

Letter of Credit Commitment”: With respect to each Issuing Lender, the amount set forth opposite such Issuing Lender’s name on Schedule 1.1 hereto under the caption “Letter of Credit Commitment, which shall, in the aggregate, be an amount equal to ten percent (10%) of the aggregate amount of the Revolving Credit Commitments, as the same may be modified from time to time in accordance with the terms of this Agreement. The Letter of Credit Commitment is part of, and not in addition to, the Revolving Credit Commitment.

 

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Letter of Credit Liabilities”: At any time and in respect of any Letter of Credit, the difference  between (a) the sum of (i) the maximum undrawn face amount of such Letter of Credit plus (ii) the aggregate unpaid principal amount of all drawings made under such Letter of Credit which have not been repaid (including repayment by a Revolving Credit Loan) and (b) all amounts then on deposit in the LC Cash Collateral Account. For purposes of this Agreement, a Revolving Credit Lender (other than the Revolving Credit Lender acting as the applicable Issuing Lender) shall be deemed to hold a Letter of Credit Liability in an amount equal to its participation interest in the related Letter of Credit under §2.10, and each Revolving Credit Lender acting as an Issuing Lender shall be deemed to hold a Letter of Credit Liability in an amount equal to its retained interest in the related Letter of Credit after giving effect to the acquisition by the Revolving Credit Lenders other than the Revolving Credit Lender acting as such Issuing Lender of their participation interests under such Section.

 

Letter of Credit Request”:  See §2.10(a).

 

LIBOR”: For any LIBOR Rate Loan for any Interest Period, the London interbank offered rate as administered by ICE Benchmark Administration (or any other Person that takes over the administration of  such rate for U.S. Dollars) for a period equal in length to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate (or, in the event such rate does not appear on a Reuters page or screen, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time as selected by Agent in its reasonable discretion; in each case the “LIBOR Screen Rate”) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period; provided that (i) if the LIBOR Screen Rate shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement with respect to any LIBOR Rate Loan that has not been identified by Parent Borrower as being subject to an interest rate swap; provided further that if the LIBOR Screen Rate shall not be available at such time for such Interest Period (an “Impacted Interest Period”) then LIBOR shall be the Interpolated Rate; provided that with respect to any LIBOR Rate Loan that has not been identified by Parent Borrower as being subject to an interest rate swap if any Interpolated Rate shall be less than zero percent per annum, such rate shall be deemed to be zero percent per annum for purposes of this Agreement and (ii) if no such rate administered by ICE Benchmark Administration (or by such other Person that has taken over  the administration of such rate for U.S. Dollars) is available to Agent, the applicable LIBOR for the relevant Interest Period shall instead be the rate determined by Agent to be the rate at which KeyBank or one of its Affiliate banks offers to place deposits in U.S. dollars with first class banks in the London interbank market at approximately 11:00 a.m. (London time) two Business Days prior to the first day of such Interest Period, in the approximate amount of the relevant LIBOR Rate Loan and having a  maturity equal to such Interest Period.  For any period during which a Reserve Percentage shall apply, LIBOR with respect to LIBOR Rate Loans  shall be equal to the amount determined above divided by an amount equal to one (1) minus the Reserve Percentage.

 

LIBOR Business Day”: Any day on which commercial banks are open for international business (including dealings in Dollar deposits) in London, England.

 

LIBOR Lending Office”: Initially, the office of each Lender designated as such on Schedule 1.1 hereto; thereafter, such other office of such Lender, if any, that shall be making or maintaining LIBOR Rate Loans.

 

LIBOR Rate Loans”: All Loans bearing interest at a rate based on LIBOR, including Revolving Credit LIBOR Rate Loans and Term LIBOR Rate Loans.

 

Lien”:  See §8.2.

 

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Loan Documents”: This Agreement, the Notes, the Guaranty, the Joinder Agreements and all other documents, instruments or agreements now or hereafter executed or delivered by or on behalf of the Borrowers in connection with the Loans and intended to constitute a Loan Document.

 

Loan Party”: Means Parent Borrower, each Subsidiary Borrower, and each Guarantor individually and Loan Parties means those parties collectively.

 

Loan Request”:  See §2.7.

 

Loan” and “Loans”: An individual loan or the aggregate loans (including a Revolving Credit Loan  (or Loans), a Term Loan (or Loans) and a Swing Loan (or Loans)), as the case may be, to be made by Lenders hereunder. All Loans shall be made in Dollars. Amounts drawn under a Letter of Credit shall also be  considered Revolving Credit Loans as provided in §2.10(f).

 

Management Agreements”: Written property management agreements providing for  the  management of the Unencumbered Assets or any of them.

 

Material Acquisition”: The acquisition by any member of the Consolidated Group, in a single transaction or in a series of related transactions, of either (a) all or any substantial portion of the property of, or  a line of business or division of, or any other property of, another Person or (b) at least a majority of the voting Equity Interests of another Person, in each case whether or not involving a merger or consolidation with such other Person, in which the value of the assets acquired in such acquisition is greater than or equal to five percent (5.0%) of Gross Asset Value as determined as of the most recent fiscal quarter which has ended at least thirty (30) days prior to such acquisition.

 

Material Adverse Effect”: A material adverse effect on (a) the business, properties, assets, financial condition or results of operations of the Consolidated Group considered as a whole; (b) the ability of the Loan Parties (taken as a whole) to perform their material obligations, respectively, under the Loan Documents; or (c) the validity or enforceability of any of the material Loan Documents or the material rights or remedies of  Agent or Lenders thereunder.

 

Maturity Date”: The Term Loan Maturity Date, the Revolving Credit Maturity Date or the Incremental Term Loan Maturity Date, as applicable.

 

Maximum Facility Amount”: The maximum aggregate amount of the Facility, which amount shall  be Three Hundred Million Dollars ($300,000,000.00) as of the Closing Date, consisting of the Revolving Credit Facility Amount and the Term Loan Facility Amount, plus any increase thereto pursuant to §2.11 or

§2.13, and less any decrease to the Revolving Credit Facility Amount pursuant to §2.4. “Moody’s”:  Moody’s Investor Service, Inc., and any successor thereto.

Multiemployer Plan”: Any multiemployer plan within the meaning of §3(37) of ERISA maintained  or contributed to by any Borrower or any ERISA Affiliate.

 

Multifamily Property”:   Any real property that contains or that will contain more than one   hundred

(100) dwelling units and in which no more than five percent (5%) of the net rentable area is rented to, or to be rented to, non-residential tenants.

 

Negative Pledge” With respect to any asset, any provision of a document, instrument or agreement (other than a Loan Document) which by its terms prohibits the creation or assumption of any Lien on such asset as security for Indebtedness of the Person owning such asset or any other Person; provided, however, that

(a)an agreement that conditions a Person’s ability to encumber its assets upon the maintenance of one or more specified ratios  that limit  such Person’s ability to encumber its assets but  that do  not  generally prohibit   the

(a)

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encumbrance of its assets, or the encumbrance of specific assets, shall not constitute a Negative Pledge, and

(b)a provision in any agreement governing unsecured Indebtedness generally prohibiting the encumbrance of assets (exclusive of any outright prohibition on the encumbrance of particular Unencumbered Assets) shall not constitute a Negative Pledge so long as such provision is generally consistent with a comparable provision of the Loan Documents.

 

Non-Consenting Lender”:  See §18.

 

Non-Excluded Taxes”:  See §4.4(b).

 

Non-Funding Lender”:  See §4.15.

 

Non-Recourse Exclusions”: With respect to any Non-Recourse Indebtedness of any Person, any industry standard exclusions from the non-recourse limitations governing such Indebtedness, including, without limitation, exclusions for claims that (i) are based on fraud, intentional misrepresentation, misapplication or misappropriation of funds, gross negligence or willful misconduct, (ii) result  from  intentional mismanagement of or waste at the Real Property securing such Non-Recourse Indebtedness, (iii) arise from the presence of Hazardous Substances on the Real Property securing such Non-Recourse Indebtedness (whether contained in a loan agreement, promissory note, indemnity agreement or other document), (iv) arise from violations of “special purpose entity” covenants (to the extent the same do not trigger full recourse liability), or (v) are the result of any unpaid real estate taxes and assessments (whether contained in a loan agreement, promissory note, indemnity agreement or other document).

 

Non-Recourse Indebtedness”: Indebtedness of Guarantors, Parent Borrower, their Subsidiaries or a Non-Wholly Owned Subsidiary which is secured by one or more parcels of Real Estate (other than an Unencumbered Asset) or interests therein or fixed or capital assets and which is not a general obligation of Parent Borrower or such Subsidiary or Non-Wholly Owned Subsidiary, the holder of such Indebtedness having recourse solely to the parcels of Real Estate, or interests therein, securing such Indebtedness or  the  direct owner of such real estate, the leases thereon and the rents, profits and equity thereof or the fixed or capital assets, as applicable (except for recourse against the general credit of Guarantors, Parent Borrower, their Subsidiaries or a Non-Wholly Owned Subsidiary for any Non-Recourse Exclusions), provided that in calculating the amount of Non-Recourse Indebtedness at any time, Parent Borrower’s reasonable estimate of the amount of any Non-Recourse Exclusions which are the subject of a claim and action shall not be included in the Non-Recourse Indebtedness but shall constitute Recourse Indebtedness. Non-Recourse  Indebtedness shall also include Indebtedness of a Subsidiary of Parent Guarantor that is not a Subsidiary Borrower or a Non- Wholly Owned Subsidiary which is a special purpose entity that is recourse solely to such Subsidiary or Non- Wholly Owned Subsidiary (or any holding company or other entity which owns such special purpose entity), which is not cross-defaulted to other Indebtedness of the Borrowers (to the extent the same would trigger full recourse liability) and which does not constitute Indebtedness of any other Person (other than such Subsidiary or Non-Wholly Owned Subsidiary which is the borrower thereunder, or any holding company or other entity which owns such special purpose entity).

 

Non-U.S. Lender”:  See §4.4(c).

 

Non-Wholly Owned Subsidiary”: In respect of any Loan Party, any other Person in whom such Loan Party holds an equity Investment which is not a Wholly Owned Subsidiary.

 

Notes”: Collectively, the Revolving Credit Notes, the Term Notes, and the Swing Loan Note.

 

Notice”:  See §19.

 

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Obligations”:  The term “Obligations” shall mean and include:

 

A.The payment, in accordance with the terms of the Loan Documents, of the principal sum, interest at variable rates, charges and indebtedness evidenced by the Notes including any extensions, renewals, replacements, increases, modifications and amendments thereof, given by the Borrowers to the order of the respective Lenders;

 

B.The payment, performance, discharge and satisfaction, in accordance with the terms of the Loan Documents, of each of the covenants, warranties, representations, undertakings and conditions to be paid, performed, satisfied and complied with by the Borrowers under and pursuant to this Credit Agreement or the other Loan Documents;

 

C.The payment, in accordance with the terms of the Loan Documents, of the costs, expenses, legal fees and liabilities incurred by Agent and Lenders in connection with the enforcement of any of Agent’s or any Lender’s rights or remedies under this Credit Agreement or the other Loan Documents, or any other instrument, agreement or document which evidences or secures any other obligations or collateral therefor, whether now in effect or hereafter executed;

 

D.The payment, performance, discharge and satisfaction of all other liabilities and obligations (including any Letter of Credit Liabilities) of any Borrower to Agent, any Issuing Lender, any Swing Loan Lender or any other Lender, whether now existing or hereafter arising, direct or indirect, absolute or  contingent, and including, without limitation express or implied upon the generality of the foregoing, each liability and obligation of any Borrower under any one or more of the Loan Documents and any amendment, extension, modification, replacement or recasting of any one or more of the instruments, agreements and documents referred to in this Credit Agreement or any other Loan Document or executed in connection with the transactions contemplated by this Credit Agreement or any other Loan Document; and

 

E.All Hedge Obligations; provided, however, that in no event shall “Obligations” include any Excluded Swap Obligations.

 

OFAC”: Office of Foreign Asset Control of the Department of the Treasury of the United States of America.

 

Other Real Estate Investments”: (i) Investments in Real Estate which are not Multifamily Properties, and (ii) Debt Investments related to Multifamily Properties.

 

Outstanding”: With respect to the Loans, the aggregate unpaid principal thereof as of any date of determination. With respect to Letters of Credit, the aggregate undrawn face amount of issued Letters  of Credit.

 

Parent Borrower”:  As defined in the recital of parties hereto.

 

Parent Guarantor”: IRT.

 

Participant Register”:  See §18.4.

 

Patriot Act”: The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, as the same may be amended from time to time, and corresponding provisions of future laws.

 

PBGC”: The Pension Benefit Guaranty Corporation created by §4002 of ERISA and any successor entity or entities having similar responsibilities.

 

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Permitted Liens”: Liens, security interests and other encumbrances permitted (or of a nature permitted) by §8.2.

 

Permitted Refinancing Indebtedness”: With respect to any Indebtedness (the “Refinanced Indebtedness”), any Indebtedness issued in exchange for, or the net proceeds of which are used to modify, extend, refinance, renew, replace or refund (collectively to “Refinanceor a “Refinancingor Refinanced”), such Refinanced Indebtedness (or previous refinancing thereof constituting Permitted Refinancing Indebtedness); provided that (A) the principal amount (or accreted value, if applicable) of any such Permitted Refinancing Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Refinanced Indebtedness outstanding immediately prior to such Refinancing except by an amount equal to the unpaid accrued interest and premium thereon plus other reasonable and customary amounts paid and fees and expenses reasonably incurred in connection with such Refinancing plus an amount equal to any existing commitment unutilized and letters of credit undrawn thereunder, unless any amount in excess of such principal amount (“Excess Refinanced Principal Amount”) is used in reduction of the Indebtedness arising under the Loans hereunder, (B) such Permitted Refinancing Indebtedness shall have a final maturity date equal to or later than the final maturity date of the Refinanced Indebtedness, (C) if the Refinanced Indebtedness is subordinated in right of payment or security to the Obligations, the Permitted Refinancing Indebtedness shall be subordinated to the same extent, and (D) no Loan Party that was not an obligor with respect to the Refinanced Indebtedness shall be an obligor under the Permitted Refinancing Indebtedness.

 

Person”: Any individual, corporation, limited liability company, partnership, trust, unincorporated association, or other legal entity, and any government or any governmental agency or political subdivision thereof.

 

Plan”: Any employee pension benefit plan within the meaning of §3(2) of ERISA maintained or contributed to by any Borrower or any ERISA Affiliate the benefits of which are guaranteed on termination in full or in part by the PBGC pursuant to Title IV of ERISA, other than a Multiemployer Plan.

 

Plan Assets”:  Assets of any Plan subject to Part 4, Subtitle B, Title I of ERISA.

 

Potential Unencumbered Asset”:  Any property of Parent Borrower or a Subsidiary Borrower which  is not at the time of determination an Unencumbered Asset.

 

Pricing Level”:  See the definition of Applicable Margin.

 

Pro Forma Basis”: As to any Person, for any events as described below that occur subsequent to the commencement of a period for which the financial effect of such events is being calculated, and giving effect to the events for which such calculation is being made, such calculation as will give pro forma effect to such events as if such events occurred on the first day of the four (4) consecutive fiscal quarter period being tested or, as applicable, the fiscal quarter period being tested (in each such case, the “Reference Period”): (a) in making any determination on a Pro Forma Basis, (x) effect shall be given to any Specified Transaction, including any change in Consolidated EBITDA relating thereto and any operating improvements or restructurings of the business of Parent Borrower or any of the Subsidiaries that are expected to have a continuing impact and are supportable, which adjustments Parent Borrower determines are reasonable and are supportable as set forth in a certificate signed on behalf of Parent Borrower by an Authorized Officer, in each case, that occurred during the Reference Period; (y) all Indebtedness (including Indebtedness issued, incurred or assumed as a result of, or to finance, any relevant transactions and for which the financial effect is being calculated, whether incurred under the Loan Documents or otherwise) issued, incurred, assumed or permanently repaid during the Reference Period shall be deemed to have been issued, incurred, assumed or  permanently repaid at the beginning of such period and (z) interest expense of such Person attributable to interest on any Indebtedness, for which pro forma effect is being given as provided in preceding clause (y), bearing floating interest rates shall be computed on a Pro Forma Basis as if the rates that would have been in effect during the  period for  which  pro forma  effect is  being  given had been actually in effect   during such

 

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periods; and (b) notwithstanding anything to the contrary in this definition or in any classification under GAAP of any Person, business, assets or operations in respect of which a definitive agreement for the asset sale, transfer, disposition or lease thereof has been entered into as discontinued operations, no pro forma effect shall be given to the classification thereof as discontinued operations (and the Consolidated EBITDA attributable to any such Person, business, assets or operations shall not be excluded for any purposes hereunder) until such asset sale, transfer, disposition or lease shall have been consummated; provided that, at the election of Parent Borrower, any adjustments to Consolidated EBITDA pursuant to clauses (a)(x) and (b) above shall not be required to be included for any Specified Transaction to the extent the aggregate consideration paid in connection with such Specified Transaction, is less than $5,000,000 in the aggregate for all such transactions  in any fiscal year.

 

Qualified ECP Loan Party”: Means, in respect of any Hedge Obligation, each Loan Party with total assets exceeding $10,000,000 at the time the relevant guaranty or grant of the relevant security interest becomes effective with respect to such Hedge Obligation 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.

 

Qualified Intermediary”: With respect to any Loan Party, a qualified intermediary within  the meaning of Internal Revenue Service Regulation 1.1031(k)-1(g)(4) that is acting for the benefit of such Loan Party.

 

Ratings Grid Election”:  See definition of Applicable Margin.

 

Real Estate”: All real property at any time owned or leased (as lessee or sublessee) by a Borrower or any of their respective Subsidiaries, including, without limitation, the Unencumbered Assets.

 

Recourse Indebtedness”: As of any date of determination, any Indebtedness (whether secured or unsecured) of Guarantors, Parent Borrower, their Subsidiaries or their Non-Wholly Owned Subsidiaries with respect to which the liability of the obligor is not limited to the obligor’s interest in specified assets securing such Indebtedness, subject to Non-Recourse Exclusions. Recourse Indebtedness shall not include Non- Recourse Indebtedness.

 

Reference Period”:  See definition of Pro Forma Basis.

 

Refinanced Indebtedness”: See definition of Permitted Refinancing Indebtedness.

 

Refinancing”:As  defined  in  the  Preamble  and  further  defined  in  the  definition   of Permitted Refinancing Indebtedness, as applicable and as the context may require.

 

Register”:  See §18.2.

 

Reimbursement Contribution”:  See §37(b).

 

Release”: Any past or present releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, disposing or dumping (other than in reasonable quantities to the extent necessary in the ordinary course of operation of Borrowers’, their tenants’ or operators’ business and, in any event, in compliance, in all material respects, with all Environmental Laws).

 

Rent Roll”: A report prepared by the Borrowers showing for each Unencumbered Asset owned or leased by the Borrowers, its occupancy, tenants, lease expiration dates, lease rent and other information in substantially the form presented to Agent on or prior to the date hereof.

 

Representative”:  See §14.17.

 

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Required Lenders”: As of any date, such Lender or Lenders whose aggregate Commitment  Percentage is equal to or greater than fifty-one percent (51%) of the aggregate amount of the Total Commitment, or, if the Total Commitment has been terminated or reduced to zero, Lenders whose aggregate Commitment Percentage is equal to or greater than fifty-one percent (51%) of the principal amount of the Aggregate Credit Exposure; provided that (a) in determining such Commitment Percentage at any given time, all then existing Defaulting Lenders will be disregarded and excluded and the Commitment Percentages of Lenders shall be redetermined, for voting purposes only, to exclude the Commitment Percentages of such Defaulting Lenders, and (b) 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 (2) Lenders.

 

Required Revolving Credit Lenders”: As of any date, the Revolving Credit Lender or Revolving Credit Lenders whose aggregate Revolving Credit Commitment Percentage is equal to or greater than fifty-one percent (51%) of the aggregate amount of the Revolving Credit Commitments, or, if the Revolving Credit Commitments have been terminated or reduced to zero, Revolving Credit Lenders whose aggregate Revolving Credit Commitment Percentage is equal to or greater than fifty-one percent (51%) of the principal amount of the Revolving Credit Exposure; provided that (a) in determining such Revolving Credit Commitment Percentage at any given time, all then existing Defaulting Revolving Credit Lenders will be disregarded and excluded and the Revolving Credit Commitment Percentages of the Revolving Credit Lenders shall be redetermined, for voting purposes only, to exclude the Revolving Credit Commitment Percentages of such Defaulting Revolving Credit Lenders, and (b) at all times when two or more Revolving Credit Lenders are party to this Agreement, the term “Required Revolving Credit Lenders” shall in no event mean less than two

 

(2)

Revolving Credit Lenders.

 

Required Term Loan Lenders”: As of any date, the Term Loan Lender or Term Loan Lenders whose aggregate Term Loan Commitment Percentage is equal to or greater than fifty-one percent (51%) of the aggregate amount of the Term Loan Commitments, or, if the Term Loan Commitments have been terminated or reduced to zero, Term Loan Lenders whose aggregate Term Loan Commitment Percentage is equal to or  greater than fifty-one percent (51%) of the principal amount of the Term Loan Credit Exposure; provided that

(a)in determining such Term Loan Commitment Percentage at any given time, all then existing Defaulting Lenders will be disregarded and excluded and the Term Loan Commitment Percentages of the Term Loan Lenders shall be redetermined, for voting purposes only, to exclude the Term Loan Commitment Percentages of such Defaulting Lenders, and (b) at all times when two or more Term Loan Lenders are party to this Agreement, the term “Required Term Loan Lenders” shall in no event mean less than two (2) Term Loan Lenders.

 

Reserve Percentage”: For any Interest Period, that percentage which is specified three (3) Business Days before the first day of such Interest Period by the Board of Governors of the Federal Reserve System (or any successor) or any other governmental or quasi-governmental authority with jurisdiction over Agent or any Lender for determining the maximum reserve requirement (including, but not limited to, any marginal reserve requirement) for Agent or any Lender with respect to liabilities constituting of or including (among other liabilities) Eurocurrency liabilities in an amount equal to that portion of the Loan affected by such Interest Period and with a maturity equal to such Interest Period.

 

Responsible Officer”: The chief executive officer, president, chief financial officer, treasurer, assistant treasurer or any executive vice president of a Loan Party and, for purposes of §10.4, the secretary or assistant secretary of a Loan Party. Any document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall  be  conclusively presumed to have acted on behalf of such Loan Party.

 

Revolving Credit Base Rate Loans”: Revolving Credit Loans bearing interest calculated by reference to the Base Rate, subject to the provisions of §2.6(b).

 

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Revolving Credit Commitment”: With respect to each Revolving Credit Lender, the amount set forth on Schedule 1.1 hereto as the amount of such Revolving Credit Lender’s Revolving Credit Commitment to make or maintain Revolving Credit Loans (other than Swing Loans) to the Borrowers, to participate in Letters of Credit for the account of the Borrowers and to participate in Swing Loans to the Borrowers, as the same may be increased or decreased from time to time or terminated in accordance with the terms of this Agreement.

 

Revolving Credit Commitment Percentage”: With respect to each Revolving Credit Lender, the percentage set forth on Schedule 1.1 hereto as such Revolving Credit Lender’s percentage of the Total Commitment; provided that if the Revolving Credit Commitments of the Revolving Credit Lenders have been terminated as provided in this Agreement, then the Revolving Credit Commitment of each Revolving Credit Lender shall be determined based on the Revolving Credit Commitment Percentage of such Revolving Credit Lender immediately prior to such termination and after giving effect to any subsequent assignments made pursuant to the terms hereof.

 

Revolving Credit Exposure”: At any time, the sum of (a) the aggregate Revolving Credit Loans held by the Revolving Credit Lenders and (b) the LC Exposure of the Revolving Credit Lenders.

 

Revolving Credit Facility”: At any time, the Revolving Credit Loans and Letters of Credit which the Revolving Credit Lenders and Issuing Lenders have agreed to make or issue (or participate in such issuance) in accordance with the terms of this Agreement in the aggregate amount of the Revolving Credit Lenders’ Revolving Credit Commitments at such time.

 

Revolving Credit Facility Amount”: The initial Two Hundred Fifty Million Dollar  ($250,000,000.00) revolving facility, plus any increase thereto pursuant to §2.11 and less any decrease thereto pursuant to §2.4.

 

Revolving Credit Lender”: Any Lender that has a Revolving Credit Commitment, the initial Revolving Credit Lenders being identified on Schedule 1.1 hereto.

 

Revolving Credit LIBOR Rate Loans”: Revolving Credit Loans bearing interest calculated by reference to LIBOR.

 

Revolving Credit Loan or Loans”: An individual Revolving Credit Loan or the aggregate Revolving Credit Loans, as the case may be, in the maximum principal amount of Two Hundred Fifty Million Dollars ($250,000,000.00) (subject to increase as provided in §2.11 and less any decrease thereto pursuant to §2.4) to be made by the Revolving Credit Lenders hereunder as more particularly described in §2. Without limiting the foregoing, (a) Revolving Credit Loans shall also include Revolving Credit Loans made pursuant to §2.10(f) and (b) Swing Loans shall constitute “Revolving Credit Loans” for all purposes hereunder.

 

Revolving Credit Maturity Date”: May 1, 2021, as such date may be extended as provided in §2.12, or such earlier date on which the Revolving Credit Loans shall become due and payable or the Revolving Credit Facility is terminated pursuant to the terms hereof.

 

Revolving Credit Notes”:  See §2.2.

 

S&P”: Standard & Poor’s Financial Services LLC, a division of McGraw-Hill Financial Inc., and  any successor thereto.

 

Sanctioned Entity”: Means (a) an agency, political subdivision, or instrumentality of the government of, (b) an organization directly or indirectly controlled by or (c) a Person or group resident in, in each case, a country that is itself the subject of Sanctions.

 

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Sanctioned Person”: A Person or group named on the list of Specially Designated Nationals or Blocked Persons maintained by the OFAC as published from time to time or 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.

 

Sanctions”: 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.

 

SEC”:  The federal Securities and Exchange Commission.

 

Secured Indebtedness”: As of any date of determination, that portion of Total Indebtedness which is secured by a Lien on Real Estate, any ownership interests in any Subsidiary or Non-Wholly Owned Subsidiary or any other assets, but excluding, with respect to any Secured Recourse Indebtedness, the amount, if any, by which the principal amount of such Secured Recourse Indebtedness exceeds the applicable Collateral Value of the collateral securing such indebtedness.

 

Secured Leverage Ratio”: As of any date of determination, Secured Indebtedness divided by Gross Asset Value, expressed as a percentage.

 

Secured Recourse Indebtedness”: As of any date of determination, that portion of Secured Indebtedness with respect to which the liability of the obligor is not limited to the obligor’s interest in specified assets securing such Indebtedness (subject to Non-Recourse Exclusions); provided that Indebtedness of a single-purpose entity (or any holding company or other entity which owns such single-purpose entity) which is secured by substantially all of the assets of such single-purpose entity (or any holding company or other entity which owns such single-purpose entity) but for which there is no recourse to another Person beyond the single- purpose entity or holding company or other entity which owns such single-purpose entity (other than with respect to Non-Recourse Exclusions) shall not be considered a part of Secured Recourse Indebtedness even if such Indebtedness is fully recourse to such single-purpose entity (or any holding company or other entity which owns such single-purpose entity) and unsecured guarantees provided by a Borrower or any Guarantor of mortgage loans to Subsidiaries or Non-Wholly Owned Subsidiaries shall not be included in Secured Recourse Indebtedness.

 

Solvent”:  With respect to the Loan Parties, that (a) the fair value of the property of the Loan Parties  is greater than the total amount of liabilities, including contingent liabilities, of the Loan Parties, (b) the  present fair salable value of the assets of the Loan Parties is not less than the amount that will be required to pay the probable liability of the Loan Parties on their debts as they become absolute and matured, (c) the Loan Parties do not intend to, and do not believe that they will, incur debts or liabilities beyond the Loan Parties’ ability to pay such debts and liabilities as they mature and (d) the Loan Parties are not engaged in business or a transaction, and are not about to engage in business or a transaction, for which the Loan Parties’ property would constitute an unreasonably small capital. The amount of contingent liabilities at any time shall be computed as the amount that, in the light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

 

Specified Loan Party”: Any Loan Party that is not then a Qualified ECP Loan Party (determined  prior to giving effect to §7.21).

 

Specified Transaction”: With respect to any period, any (a) asset sale, acquisition, Investment, sale, transfer or other disposition of assets or property other than in the ordinary course, (b) any merger or consolidation, or any similar transaction, or (c) any incurrence, issuance or repayment of Indebtedness.

 

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Stabilized Property”: Real Estate (a) which is a commercial property operating as a Multifamily Property that is completed with tenants in occupancy and open for business, or (b) which has ceased to be a “Construction in Process” in accordance with the definition thereof.

 

State”:  A state of the United States of America and the District of Columbia.

 

Subsidiary”:  For any Person, any corporation, partnership, limited liability company or other entity  of which at least a majority of the securities or other ownership interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other persons performing similar functions of such corporation, partnership, limited liability company or other entity (without regard to the occurrence of any contingency) is at the time directly or indirectly owned or controlled by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person, and shall include all Persons the accounts of which are consolidated with those of such Person pursuant to GAAP.

 

Subsidiary Borrowers”: Any Borrower that is a Subsidiary of Parent Borrower party hereto as of the Closing Date and any Additional Subsidiary Borrower that is the direct owner of an Unencumbered Asset.

 

Swing Loan”:  See §2.5(a).

 

Swing Loan Commitment”: With respect to each Swing Loan Lender, the amount set forth opposite such Swing Loan Lender’s name on Schedule 1.1 hereto under the caption “Swing Loan Commitment”, which shall, in the aggregate, be an amount equal to ten percent (10%) of the aggregate amount of the Revolving Credit Commitments, as the same may be changed from time to time in accordance with the terms of this Agreement. The Swing Loan Commitment is part of, and not in addition to, the Total Commitment.

 

Swing Loan Lenders”: KeyBank and Citibank, each in its capacity as a Swing Loan Lender, and any successors thereto in such capacity.

 

Swing Loan Note”:  See §2.5(b).

 

Swing Loan Share”: With respect to each Swing Loan Lender and each Swing Loan, such Swing Loan Lender’s ratable portion of such Swing Loan, calculated based upon the ratio of such Swing Loan Lender’s Swing Loan Commitment to the total Swing Loan Commitments of all of the Swing Loan Lenders.

 

Syndication Agents”:  As defined in the preamble hereto.

 

Taking”: The taking or appropriation (including by deed in lieu of condemnation) of any Unencumbered Asset, or any part thereof or interest therein, whether permanently or temporarily, for public or quasi-public use under the power of eminent domain, by reason of any public improvement or condemnation proceeding, or in any other manner or any customarily recognized and compensated damage or injury or  diminution in value through condemnation, inverse condemnation or other exercise of the power of eminent domain.

 

Taxes”: Any present or future taxes, levies, imposts, duties, charges, fees, or similar deductions or withholdings that are imposed by any Governmental Authority.

 

Term Base Rate Loans”: Term Loans bearing interest calculated by reference to the Base Rate, subject to the provisions of §2.6(a).

 

Term LIBOR Rate Loans”: Term Loans bearing interest calculated by reference to the LIBOR Rate.

 

Term Loan or Loans”:  An individual Term Loan or the aggregate Term Loans, as the case may be,  in the maximum principal amount of Fifty Million Dollars ($50,000,000.00) (as the same may be increased

 

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pursuant to §2.11 or §2.13) to be made by the Term Loan Lenders hereunder as more particularly described in

§2.

 

Term Loan Commitment”: As to each Term Loan Lender, its obligation to make Term Loans to the Borrowers pursuant to §2.1(a), in an amount up to, but not exceeding, the amount set forth for such Lender on Schedule 1.1 attached hereto as such Lender’s “Term Loan Commitment Amount” or as set forth in the applicable Assignment and Assumption Agreement, as the same may be increased or decreased from time to time or terminated in accordance with the terms of this Agreement.

 

Term Loan Commitment Percentage”: As to each Term Loan Lender, the ratio, expressed as a percentage, of (a) the amount of such Term Loan Lender’s Term Loan Commitment to (b) the aggregate amount of the Term Loan Commitments of all Term Loan Lenders; provided, however, that if at the time of determination the Term Loan Lenders’ Term Loan Commitments have terminated or been reduced to zero (0), the “Term Loan Commitment Percentage” of each Term Loan Lender shall be the Term Loan Commitment Percentage of such Term Loan Lender in effect immediately prior to such termination or reduction.

 

Term Loan Exposure”: The aggregate Term Loans held by the Term Loan Lenders.

 

Term Loan Facility”: At any time, the Term Loans which the Term Loan Lenders have agreed to make in accordance with the terms of this Agreement in the aggregate amount of the Term Loan Lenders’  Term Loan Commitments at such time.

 

Term Loan Facility Amount”: The initial Fifty Million Dollar ($50,000,000.00) term facility, plus any increase thereto pursuant to §2.11 or §2.13.

 

Term Loan Lender”: Any Lender that has a Term Loan Commitment, the initial Term Loan Lenders being identified on Schedule 1.1 hereto.

 

Term Loan Maturity Date”: May 1, 2022, or such earlier date on which the Loans shall become due and payable pursuant to the terms hereof.

 

Term Loan Notes”:  See §2.2.

 

Titled Agents”:  Arrangers, Syndication Agents, Bookrunners, or any Documentation Agent.

 

Total Commitment”: The sum of the Revolving Credit Commitments and Term Loan Commitments, as the same may be increased or decreased from time to time or terminated in accordance with the terms of this Agreement.

 

Total Consolidated Operating Property Value”: As of any date of determination, on a consolidated basis for the Consolidated Group, the sum of: (a) the aggregate Consolidated Asset NOI for all Stabilized Properties (excluding Consolidated Asset NOI from Stabilized Properties being held at acquisition cost   under

(b)below) for the most recent calendar quarter, annualized, divided by the Capitalization Rate, plus (b) the acquisition cost of any Stabilized Property for the first eighteen (18) months following its acquisition.

 

Total Indebtedness”: As of any date of determination, without duplication, the sum of (a) all Indebtedness of the Consolidated Group outstanding at such date, determined on a Consolidated basis plus (b) the Consolidated Group Pro Rata Share of all Indebtedness of any Non-Wholly Owned Subsidiaries outstanding at such date.

 

Total Unencumbered Asset Value”: As of any date of determination, on a consolidated basis for the Consolidated Group the sum of: (a) the aggregate Unencumbered Asset NOI for all Stabilized Properties (excluding  Unencumbered  Asset  NOI  from Stabilized  Properties  being  held at acquisition  cost  under (b)

 

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below) for the most recent calendar quarter, annualized, divided by the Capitalization Rate, plus (b) the acquisition cost of any Stabilized Property for the first eighteen (18) months following its acquisition plus (c) 80% of all 1031 Cash held by a Qualified Institution on behalf of any Loan Party at such time.

 

Type”:  As to any Loan, its nature as a Base Rate Loan or a LIBOR Rate Loan.

 

Unencumbered Asset Adjusted NOI”: On any date of determination, the Unencumbered Asset NOI for the most recent fiscal quarter, annualized, less, with respect to Real Estate owned by any Person in the Consolidated Group, the Capital Expenditure Reserve, and, with respect to Real Estate owned by Non-Wholly Owned Subsidiaries, the Consolidated Group Pro Rata Share of the Capital Expenditure Reserve.

 

Unencumbered Asset Conditions”:  See the definition of Unencumbered Assets.

 

Unencumbered Asset Financial Covenants”: The financial covenants set forth in §9.8 (Unencumbered Assets), §9.9 (Maximum Unsecured Leverage Ratio) and §9.10 (Minimum Unencumbered Assets Debt Service Coverage Ratio).

 

Unencumbered Asset NOI”: As of any date of determination, “property rental and other income” attributable to the Unencumbered Assets (including, without limitation, payments received from insurance on account of business or rental interruption and condemnation proceeds from any temporary use or occupancy) accruing for such period minus the amount of all expenses incurred in connection with and directly attributable to the ownership and operation of such Unencumbered Assets for such period (including, without limitation, property management fees and amounts accrued for the payment of real estate taxes and insurance premiums, but excluding Interest Expense or other debt service charges and any non-cash charges such as depreciation or amortization of financing costs plus acquisition costs for consummated acquisitions), with such results being “grossed up” for any Unencumbered Assets not owned for the entire testing period.

 

Unencumbered Assets”: (a) Each Multifamily Property listed on Schedule 5.1 and (b) each other Multifamily Property designated as an Unencumbered Property by Parent Borrower pursuant to §5.2 (i) that is an operating Multifamily Property located within the fifty (50) States of the United States or the District of Columbia, (ii) that is wholly-owned in fee (or leased under a Ground Lease acceptable to Agent in its reasonable discretion), by Parent Borrower or a Subsidiary Borrower, (iii) that is not subject to any Liens  (other than Permitted Liens) or any Negative Pledge, (iv) that is not subject to mezzanine debt financing, (v) that is not the subject of a Disqualifying Environmental Event or Disqualifying Structural Event and is free of all title defects, or other materially adverse matters, in each case which in the reasonable determination of Agent would materially impact the value, cashflow, or marketability of such Multifamily Property and (vi)  with respect to which all of the representations set forth in §6 of this Agreement concerning Unencumbered Assets are true and correct in all material respects with respect thereto (the requirements   described in clauses

 

(i)

through (vi) being the “Unencumbered Asset Conditions”).

 

Unencumbered Assets Debt Service Coverage Ratio”: As of any date of determination, Unencumbered Asset Adjusted NOI for all Unencumbered Assets divided by Implied Unsecured Debt Service, expressed as a percentage.

 

Unhedged Variable Rate Indebtedness”: As of any date of determination, the sum of (a) Total Indebtedness minus (b) the sum of (i) the aggregate amount of all Total Indebtedness having interest which accrues thereon at a fixed rate of interest per annum plus (ii) with respect to all Total Indebtedness hedged by Derivatives Contracts effectively fixing or capping the per annum rate of interest thereof, the aggregate notational amount of all such Derivatives Contracts.

 

Unimproved Land”: Real Estate which is unimproved and on which no development or Construction in Process is in effect.

 

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Unrestricted Cash and Cash Equivalents”: As of any date of determination, the sum of (a) the aggregate amount of Unrestricted cash and (b) the aggregate amount of Unrestricted Cash Equivalents (valued at fair market value). As used in this definition, “Unrestricted cash” and “Unrestricted Cash Equivalents” means, as of any date of determination, the aggregate amount of cash and Cash Equivalents included in the cash accounts that would be listed on the consolidated balance sheet of the Consolidated Group prepared in accordance with GAAP as of the end of the most recently ended fiscal quarter ending prior to the date of such determination for which consolidated financial statements of the Consolidated Group are available to the  extent such cash is not classified as restricted for financial statement purposes (unless so classified solely because of any provision under this Agreement and/or the other Loan Documents or because they are subject  to a Lien securing the Obligations hereunder or  the obligations thereunder).

 

Unsecured Indebtedness”: As of any date of determination, the portion of Total Indebtedness outstanding at such date that is not Secured Indebtedness.

 

Unsecured Leverage Ratio”:   As  of any date of determination,  Unsecured Indebtedness divided   by

Total Unencumbered Asset Value, expressed as a percentage.

 

Unsecured Recourse Indebtedness”: As of any date of determination, Recourse Indebtedness that is not Secured Recourse Indebtedness.

 

Unused Fee”:  See §2.3(a).

 

U.S. Lender”:  See §4.4(c).

 

Wholly Owned Subsidiary”: As to Parent Borrower, any Subsidiary of Parent Borrower that is directly or indirectly owned one hundred percent (100%) by Parent Borrower, without regard to Equity Interests issued so as to achieve up to 125 equity holders so as to qualify as a REIT.

 

Write-Down and Conversion Powers”: Means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

 

§1.2Rules of Interpretation.

 

 

(a)

A reference to any document or agreement shall include such document or agreement

as amended, modified or supplemented from time to time in accordance with its terms and the terms of this Agreement.

 

 

(b)

The singular includes the plural and the plural includes the singular.

 

 

(c)

A reference to any law includes any amendment or modification of such law.

 

 

(d)

A reference to any Person includes its permitted successors and permitted assigns.

 

 

(e)

Accounting terms not otherwise defined herein have the meanings assigned to   them

by GAAP applied on a consistent basis by the accounting entity to which they refer.

 

 

(f)

The words “include”, “includes” and “including” are not limiting.

 

 

(g)

The words “approval” and “approved”, as the context requires, means an approval in

writing given to the party seeking approval.

 

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(h)

All terms not specifically defined herein or by GAAP, which terms are defined in the

Uniform Commercial Code as in effect in the State of New York, have the meanings assigned to them therein.

 

 

(i) otherwise indicated.

Reference  to  a  particular  “§”,  refers  to  that  section  of  this  Agreement     unless

 

 

 

(j)

The words  “herein”,  “hereof”, “hereunder”  and words  of like import shall refer to

this Agreement as a whole and not to any particular section or subdivision of this Agreement.

 

 

(k)

The words “the date hereof” or words of like import shall mean the date that this

Agreement is fully executed by all parties.

 

 

(l)

In the event of any change in generally accepted accounting principles after the   date

hereof or any other change in accounting procedures pursuant to §7.3 which would affect the computation of any financial covenant, ratio or other requirement set forth in any Loan Document, then upon the request of the Borrowers or Agent, the Borrowers and Agent shall negotiate promptly, diligently and in good faith in order to amend the provisions of the Loan Documents such that such financial covenant, ratio or other  requirement  shall continue to provide substantially the same financial tests or restrictions of the Borrowers as in effect prior to such accounting change, as determined by Parent Borrower and Agent in good faith.  Until such time as  such amendment shall have been executed and delivered by the Borrowers and Agent, such financial covenants, ratio and other requirements, and all financial statements and other documents required to be delivered under the Loan Documents, shall be calculated and reported as if such change had not occurred.

 

 

(m)

For purposes of this Agreement, “knowledge” of any Loan Party or any Loan Party

“becoming aware” or other language of similar import means, with respect to any matter, the actual knowledge of any Responsible Officer.

 

§2THE CREDIT FACILITY.

 

§2.1Loans.

 

 

(a)

The Term Loan.  Subject to the terms and conditions set forth in this Agreement,   on

the Closing Date the Term Loan Lenders severally agree to make the Term Loan in the original principal amount of the Term Loan Facility Amount to the Borrowers.

 

 

(b)

The Revolving Credit Loan.   Subject to the terms  and  conditions  set forth in   this

Agreement, each of the Revolving Credit Lenders severally agrees to lend to the Borrowers, and the Borrowers may borrow (and repay and reborrow) from time to time between the Closing Date and the Revolving Credit Maturity Date upon notice by the Borrowers to Agent given in accordance with §2.7, such sums as are requested by the Borrowers for the purposes set forth in §2.9 up to a maximum aggregate principal amount Outstanding (after giving effect to all amounts requested) at any one time equal to the lesser of (i) such Revolving Credit Lender’s Revolving Credit Commitment and (ii) such Revolving Credit Lender’s Revolving Credit Commitment Percentage of (A) the Facility Available Amount minus (B) the sum of (1) the amount of all Outstanding Revolving Credit Loans and (without duplication) Swing Loans, (2) the aggregate amount of Letter of Credit Liabilities, and (3) the amount of all Outstanding Term Loans; provided, that, in all events no Default or Event of Default shall have occurred and be continuing; and provided, further, that the Outstanding principal amount of the Revolving Credit Loans (after giving effect to all amounts requested), Swing Loans, Letter of Credit Liabilities, and Term Loans shall not at any time exceed the Total Commitment or cause a violation of the covenants set forth in §9. The Revolving Credit Loans shall be made pro rata in accordance with each Revolving Credit Lender’s Revolving Credit Commitment Percentage. Each request for  a  Revolving Credit Loan hereunder shall constitute a representation and warranty by the Borrowers that all of  the conditions required of the Borrowers set forth in §10 and §11 have been satisfied on the date of such  request (or if such condition is required to have been satisfied only as of the Closing Date, that such condition

 

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was satisfied as of the Closing Date). Agent may assume that the conditions in §10 and §11  have been  satisfied unless it receives prior written notice from a Revolving Credit Lender that such conditions have not been satisfied. No Revolving Credit Lender shall have any obligation to make Revolving Credit Loans to the Borrowers in the maximum aggregate principal outstanding balance of more than the principal face amount of its Revolving Credit Note or its Revolving Credit Commitment, as applicable.

 

§2.2  Notes.  The Loans shall, if requested by each Lender, be evidenced by separate promissory   notes of the Borrowers in substantially the form of Exhibit A-1 hereto (with respect to Revolving Credit  Loans) and Exhibit A-2 hereto (with respect to Term Loans) (collectively, the “Revolving Credit Notes” and the “Term Loan Notes”, respectively), dated of even date with this Agreement (except as otherwise provided in

§18.3) and completed with appropriate insertions. One Revolving Credit Note shall be payable to the order of each Revolving Credit Lender which so requests the issuance of a Revolving Credit Note in the principal amount equal to such Revolving Credit Lender’s Revolving Credit Commitment or, if less, the outstanding amount of all Revolving Credit Loans made by such Revolving Credit Lender, plus interest accrued thereon, as set forth below. One Term Loan Note shall be payable to the order of each Term Loan Lender which so requests the issuance of a Term Loan Note in the principal amount equal to such Term Loan Lender’s Term Loan Commitment.

 

§2.3    Unused Fee; Facility Fee.  (a)  Subject to §2.3(b) below, the Borrowers agree to pay to Agent for the account of the Revolving Credit Lenders (other than any Defaulting Revolving Credit Lender) in accordance with their respective Revolving Credit Commitment Percentages a facility unused fee (the “Unused Fee”) calculated at the rate per annum as set forth below on the actual daily amount by which the Revolving Credit Commitment exceeds the outstanding principal amount of Revolving Credit Loans, Swing Loans and the face amount of Letters of Credit Outstanding during each calendar quarter or portion thereof commencing on the date hereof and ending on the Revolving Credit Maturity Date. The Unused Fee shall be calculated for each quarter based on the ratio (expressed as a percentage) of (i) the actual daily amount of the outstanding principal amount of the Revolving Credit Loans and (without duplication) Swing Loans and the face amount of Letters of Credit Outstanding during such quarter to (ii) the Revolving Credit Commitment, and if such ratio is less than fifty percent (50%), the Unused Fee shall be payable at the rate of one quarter of one percent (0.25%) per annum, and if such ratio is equal to or greater than fifty percent (50%), the Unused Fee shall be payable at the rate of fifteen hundredths of one percent (0.15%) per annum.  The Unused Fee shall be payable quarterly in

arrears on the first (1st) Business Day of each calendar quarter for the immediately preceding calendar quarter or portion thereof, and on any earlier date on which the Revolving Credit Commitments shall be reduced or

shall terminate as provided in §2.4, with a final payment on the Revolving Credit Maturity Date.

 

(b)In the event that Parent Guarantor   achieves an Investment Grade Rating and Parent

Borrower makes a Ratings Grid Election, the Borrowers shall no longer pay the Unused Fee immediately following the end of the quarter during which Agent receives such notice. For each succeeding quarter, the Borrowers shall pay a facility fee (the “Facility Fee”) at the applicable rate set forth in the Debt Ratings pricing grid in the definition of “Applicable Margin”, times the actual daily amount of each Revolving Credit Lender’s Revolving Credit Commitment, regardless of usage. The Facility Fee will be payable quarterly in arrears on  the last day of each March, June, September and December, and on the Revolving Credit Maturity Date. If Parent Borrower has made the Ratings Grid Election as described above but thereafter Parent Guarantor fails  to maintain an Investment Grade Rating by at least one of S&P or Moody’s, then (x) the Unused Fee shall be payable during the period commencing on the date Parent Guarantor no longer has an Investment Grade Rating by at least one of S&P or Moody’s and ending on the date Parent Borrower makes another Ratings Grid Election, and (y) no Facility Fee shall be payable during the period that the Unused Fee is payable.

 

§2.4  Reduction and Termination of the Revolving Credit Commitments.  The Borrowers shall have the right at any time and from time to time upon five (5) Business Days’ prior written notice to Agent to  reduce by $25,000,000.00 or an integral multiple of $5,000,000.00 in excess thereof (provided that in no event shall the Revolving Credit Commitment be reduced in such manner to an amount less than $75,000,000.00 unless the Revolving Credit Commitment is terminated in full) or to terminate entirely the Revolving Credit

 

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Commitments, whereupon the Revolving Credit Commitments of the Revolving Credit Lenders shall be reduced pro rata in accordance with their respective Revolving Credit Commitment Percentages of the amount specified in such notice or, as the case may be, terminated, any such termination or reduction to be without penalty except as otherwise set forth in §4.8; provided, however, that no such termination or reduction shall be permitted if, after giving effect thereto, the sum of Outstanding Revolving Credit Loans, the Outstanding Swing Loans and the Letter of Credit Liabilities would exceed the Revolving Credit Commitments of the Revolving Credit Lenders as so terminated or reduced. Promptly after receiving any notice from the  Borrowers delivered pursuant to this §2.4, Agent will notify the Revolving Credit Lenders of the substance thereof. Any reduction of the Revolving Credit Commitments shall also result in a proportionate reduction (rounded to the next lowest integral multiple of $100,000.00) in the maximum amount of the Swing Loan Commitment and the Letter of Credit Commitment, respectively. Upon the effective date of  any  such reduction or termination, the Borrowers shall pay to Agent for the respective accounts of the Revolving Credit Lenders the full amount of any Unused Fee or Facility Fee under §2.3 then accrued on the amount of the reduction. No reduction or termination of the Revolving Credit Commitments may be reinstated.

 

§2.5Swing Loan Commitment.

 

 

(a)

Subject  to the  terms  and conditions  set  forth in this  Agreement,  each Swing Loan

Lender agrees, in accordance with its respective Swing Loan Share, to lend to the Borrowers (the “Swing Loans”), and the Borrowers may borrow (and repay and reborrow) from time to time between the Closing Date and the date which is ten (10) Business Days prior to the Revolving Credit Maturity Date upon notice by the Borrowers to the Swing Loan Lenders given in accordance with this §2.5, such sums as are requested by the Borrowers for the purposes set forth in §2.9 in an aggregate principal amount at any one time outstanding with respect to each Swing Loan Lender not exceeding such Swing Loan Lender’s Swing Loan Commitment; provided that in all events (i) no Default or Event of Default shall have occurred and be continuing; (ii) if a Revolving Credit Lender shall be a Defaulting Lender, the requested amount of the Swing Loan shall be reduced by the amount of such Defaulting Lender’s participation interest in the Swing Loan; and (iii) the Outstanding principal amount of the Revolving Credit Loans and (without duplication) Swing Loans (after giving effect to all amounts requested), plus Letter of Credit Liabilities shall not at any time exceed the lesser of (A) the aggregate Revolving Credit Commitments or (B) the Facility Available Amount less the  Outstanding Term Loans. The funding of a Swing Loan hereunder shall constitute a representation and warranty by the Borrowers that all of the conditions set forth in §10 and §11 have been satisfied on the date of such funding (or if such condition is required to have been satisfied only as of the initial Closing Date, that such condition was satisfied as of the Closing Date) or waived by Agent. Each Swing Loan Lender may assume that the conditions in §10 and §11 have been satisfied unless such Swing Loan Lender has received written notice from a Revolving Credit Lender that such conditions have not been satisfied. Each Swing Loan shall be due and payable within seven (7) days of the date such Swing Loan was provided and the Borrowers hereby agree (to the extent not repaid as contemplated by §2.5(d) below) to repay each Swing Loan (whether or not demand for payment is made) on or before the date that is seven (7) days from the date such Swing Loan was provided.

 

 

(b)

The Swing Loans shall be evidenced by separate promissory notes of the   Borrowers

in substantially the form of Exhibit B hereto (the “Swing Loan Notes”), dated the date of this Agreement and completed with appropriate insertions. The Swing Loan Notes shall be payable to the order of the Swing Loan Lenders in the principal face amount equal to each such Swing Loan Lender’s Swing Loan Commitment and shall be payable as set forth below.

 

 

(c)

The Borrowers shall request a Swing Loan by delivering to the Agent and the Swing

Loan Lenders a Loan Request executed by an Authorized Officer, together with an executed Availability Certificate in the form of Exhibit F, no later than 1:00 p.m. (Eastern time) on the requested Drawdown Date specifying the amount of the requested Swing Loan (which shall be in the minimum amount of $1,000,000.00) and providing the wire instructions for the delivery of the Swing Loan proceeds. The Loan Request shall also contain  the  information  required  by  §2.7  (to  the  extent  applicable).    Each  such  Loan  Request  shall be

 

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irrevocable and binding on the Borrowers and shall obligate the Borrowers to accept such Swing Loan on the Drawdown Date. Notwithstanding anything herein to the contrary, a Swing Loan shall be a Base Rate Loan and shall bear interest at a rate per annum equal to the Base Rate for Revolving Credit Base Rate Loans. The proceeds of the Swing Loan will be disbursed by wire by the Swing Loan Lenders (in accordance with their respective Swing Loan Shares) to the Borrowers no later than 3:00 p.m. (Eastern time) on the requested Drawdown Date.

 

 

(d)

The Swing Loan Lenders shall, within two (2) Business Days after the Drawdown

Date with respect to such Swing Loan, request each Revolving Credit Lender, including the Swing Loan Lenders, to make a Revolving Credit Loan pursuant to §2.1 in an amount equal to such Revolving Credit Lender’s Revolving Credit Commitment Percentage of the amount of the Swing Loan outstanding on the date such notice is given.         In the event that the Borrowers do not notify Agent in writing otherwise on or before

noon (Eastern time) of the third (3rd) Business Day after the Drawdown Date with respect to such Swing Loan,

Agent shall notify the Revolving Credit Lenders that such Revolving Credit Loan shall be a Revolving Credit LIBOR Rate Loan with an Interest Period of one (1) month, provided that the making of such Revolving  Credit LIBOR Rate Loan will not be in contravention of any other provision of this Agreement, or if the making of a Revolving Credit LIBOR Rate Loan would be in contravention of this Agreement,  then such notice shall indicate that such loan shall be a Revolving Credit Base Rate Loan. The Borrowers hereby irrevocably authorize and direct the Swing Loan Lenders to so act on their behalf, and agrees that any amount advanced to Agent for the benefit of any Swing Loan Lender pursuant to this §2.5(d) shall be considered a Revolving Credit  Loan pursuant to §2.1.       Unless any of the events  described in paragraph (h), (i), or  (j) of

§12.1 shall have occurred (in which event the procedures of §2.5(e) shall apply), each Revolving Credit Lender shall make the proceeds of its Revolving Credit Loan available to the applicable Swing Loan Lender for the account of such Swing Loan Lender at Agent’s Head Office prior to 12:00 noon (Eastern time) in funds immediately available no later than the third (3rd) Business Day after the date such notice is given just as if the Revolving Credit Lenders were funding directly to the Borrowers, so that thereafter such Obligations shall be evidenced by the Revolving Credit Notes. The proceeds of such Revolving Credit Loan shall be immediately applied to repay the Swing Loans.

 

 

(e)

If for  any reason a  Swing  Loan cannot  be refinanced by a  Revolving Credit Loan

pursuant to §2.5(d) (including due to a Defaulting Lender’s failure to fund), each Revolving Credit Lender  will, on the date such Revolving Credit Loan pursuant to §2.5(d) was to have been made, purchase an undivided participation interest in the Swing Loan in an amount equal to its Revolving Credit Commitment Percentage of such Swing Loan (or portion thereof). Each Revolving Credit Lender will immediately transfer to the Swing Loan Lenders in immediately available funds the applicable amount of its participation and upon receipt thereof each Swing Loan Lender will deliver to such Revolving Credit Lender a Swing Loan participation certificate dated the date of receipt of such funds and in the amount received by such Swing Loan Lender.

 

 

(f)

Whenever at any time after a Swing Loan Lender   has received from any Revolving

Credit Lender such Revolving Credit Lender’s participation interest in a Swing Loan, or such Swing Loan Lender receives any payment on account thereof, such Swing Loan Lender will distribute to such Revolving Credit Lender its participation interest in such amount (appropriately adjusted in the case of interest payments to reflect the period of time during which such Revolving Credit Lender’s participating interest was outstanding and funded); provided, however, that in the event that such payment received by such Swing Loan Lender is required to be returned, such Revolving Credit Lender will return to such Swing Loan Lender any portion thereof previously distributed by such Swing Loan Lender to it.

 

 

(g)

Each  Revolving  Credit  Lender’s  obligation  to  fund  a  Revolving  Credit  Loan as

provided in §2.5(d) or to purchase participation interests pursuant to §2.5(e) shall be absolute and unconditional and shall not be affected by any circumstance, including, without limitation, (i) any setoff, counterclaim, recoupment, defense or other right which such Revolving Credit Lender or the Borrowers may have  against  any Swing Loan  Lender,  the  Borrowers  or  anyone  else  for  any reason whatsoever;  (ii)   the

 

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occurrence or continuance of a Default or an Event of Default; (iii) any adverse change in the condition (financial or otherwise) of the Borrowers or any of their respective Subsidiaries; (iv) any breach of this Agreement or any of the other Loan Documents by the Borrowers or any Lender; or (v) any other  circumstance, happening or event whatsoever, whether or not similar to any of the foregoing.  Any portions of  a Swing Loan not so purchased or converted may be treated by Agent and the Swing Loan Lenders as against such Revolving Credit Lender as a Revolving Credit Loan which was not funded by the non-purchasing Revolving Credit Lender as contemplated by §2.8 and §12.5, and shall have such rights and remedies against such Revolving Credit Lender as are set forth in §2.8, §12.5, and §14.5. Each Swing Loan, once so sold or converted, shall cease to be a Swing Loan for the purposes of this Agreement, but shall be a Revolving Credit Loan made by each Revolving Credit Lender under its Revolving Credit Commitment.

 

§2.6Interest on Loans.

 

 

(a)

Each Term Base Rate Loan shall bear interest for the period commencing with the

Drawdown Date thereof and ending on the date on which such Term Base Rate Loan is repaid or converted to a Term LIBOR Rate Loan at the rate per annum equal to the Base Rate for Term Base Rate Loans.

 

 

(b)

Each Revolving Credit Base Rate Loan shall bear interest for the period commencing

with the Drawdown Date thereof and ending on the date on which such Revolving Credit Base Rate Loan is repaid or converted to a Revolving Credit LIBOR Rate Loan at the rate per annum equal to the Base Rate for Revolving Credit Base Rate Loans.

 

 

(c)

Each Term LIBOR Rate Loan shall bear interest for the period commencing with the

Drawdown Date thereof and ending on the last day of each Interest Period with respect thereto at the rate per annum equal to the sum of LIBOR determined for such Interest Period plus the Applicable Margin for Term LIBOR Rate Loans.

 

 

(d)

Each  Revolving  Credit  LIBOR  Rate  Loan  shall  bear   interest  for   the     period

commencing with the Drawdown Date thereof and ending on the last day of each Interest Period with respect thereto at the rate per annum equal to the sum of LIBOR determined for such Interest Period plus the Applicable Margin for Revolving Credit LIBOR Rate Loans.

 

 

(e)

The Borrowers  promise to  pay interest  on each Loan  in arrears  on  each     Interest

Payment Date with respect thereto.

 

 

(f)

Type as provided in §4.1.

Base Rate Loans and LIBOR Rate Loans may be converted to Loans of the other

 

 

(g)The parties understand that the applicable interest rate for the Loans   and certain fees

set forth herein may be determined and/or adjusted from time to time based upon certain financial ratios and/or other information to be provided or certified to Lenders by the Borrowers (the “Borrower Information”).  If it  is subsequently determined that any such Borrower Information was incorrect (for whatever reason, including without limitation because of a subsequent restatement of earnings by the Borrowers) at the time it was delivered to Agent, and if the applicable interest rate or fees calculated for any period were different than they should have been had the correct information been timely provided, then, such interest rate and such fees for such period shall be automatically recalculated using correct Borrower Information. Agent shall promptly notify the Borrowers in writing of any additional interest and fees due because of such recalculation, and the Borrowers shall pay such additional interest or fees due to Agent, for the account of each Lender, within five

(5)Business Days of receipt of such written notice. The Borrowers shall receive a credit or refund of any overpayment promptly after such determination. Any recalculation of interest or fees required by  this provision shall survive the termination of this Agreement for a period of one hundred eighty (180) days, and this provision shall not in any way limit any of Agent’s, any Issuing Lender’s, or any Lender’s other rights under this Agreement.

(5)

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§2.7  Requests  for Revolving Credit  Loans.  Except  with respect to the initial Revolving Credit  Loan on the Closing Date, the Borrowers shall give to Agent written notice executed by an Authorized Officer in the form of Exhibit D hereto (or telephonic notice confirmed in writing in the form of Exhibit D hereto) of each Revolving Credit Loan requested hereunder (a “Loan Request”) by 1:00 p.m. (Eastern time) one (1) Business Day prior to the proposed Drawdown Date with respect to Revolving Credit Base Rate Loans and  two (2) Business Days prior to the proposed Drawdown Date with respect to Revolving Credit LIBOR Rate Loans, together with an executed Availability Certificate in the form of Exhibit F. Each such notice shall specify with respect to the requested Revolving Credit Loan the proposed principal amount of such Revolving Credit Loan, the Type of Revolving Credit Loan, the initial Interest Period (if applicable) for such Revolving Credit Loan and the Drawdown Date. Promptly upon receipt of any such notice, Agent shall notify each of the Revolving Credit Lenders thereof. Each such Loan Request shall be irrevocable and binding on the Borrowers and shall obligate the Borrowers to accept the Revolving Credit Loan requested from the Revolving Credit Lenders on the proposed Drawdown Date. Nothing herein shall prevent the Borrowers from seeking recourse against any Revolving Credit Lender that fails to advance its proportionate share of a requested Revolving Credit Loan as required by this Agreement. Each Loan Request shall be (a) for a Revolving Credit Base Rate Loan in a minimum aggregate amount of $100,000.00; or (b) for a Revolving Credit LIBOR Rate Loan in a minimum aggregate amount of $500,000.00; provided, however, that there shall be no more than seven (7) LIBOR Rate Loans outstanding at any one time.

 

§2.8Funds for Loans.

 

 

(a)

Not  later  than  noon  (Eastern  time)   on  the  proposed  Drawdown  Date  of     any

Revolving Credit Loans, each of the Revolving Credit Lenders will make available to Agent, at Agent’s Head Office, in immediately available funds, the amount of such Lender’s Revolving Credit Commitment  Percentage of the amount of the requested Loans which may be disbursed pursuant to §2.1. Upon receipt from each such Revolving Credit Lender of such amount, and upon receipt of the documents required by §10 and

§11 and the satisfaction of the other conditions set forth therein (except, in each case, to the extent waived by Agent) to the extent applicable, Agent will make available to the Borrowers the aggregate amount of such Revolving Credit Loans made available to Agent by the Revolving Credit Lenders by crediting such amount to the account of the Borrowers maintained at Agent’s Head Office or wiring such funds in accordance with the Borrowers’ written instructions. The failure or refusal of any Revolving Credit Lender to make available to Agent at the aforesaid time and place on any Drawdown Date the amount of its Revolving Credit Commitment Percentage of the requested Revolving Credit Loans shall not relieve any other Revolving Credit Lender from its several obligation hereunder to make available to Agent the amount of such other Lender’s Revolving Credit Commitment Percentage of any requested Revolving Credit Loans, including any additional Revolving Credit Loans that may be requested subject to the terms and conditions hereof to provide funds to replace those not advanced by the Revolving Credit Lender so failing or refusing.

 

 

(b)

Unless  Agent  shall  have  been  notified  by  any  Lender  prior  to  the     applicable

Drawdown Date that such Lender will not make available to Agent such Lender’s Commitment Percentage of  a proposed Loan, Agent may in its discretion assume that such Lender has made such Loan available to Agent in accordance with the provisions of this Agreement and Agent may, if it chooses, in reliance upon such assumption make such Loan available to the Borrowers, and such Lender shall be liable to Agent for the amount of such advance. If such Lender does not pay such corresponding amount upon Agent’s demand therefor, Agent will promptly notify the Borrowers, and the Borrowers shall promptly pay such corresponding amount to Agent. Agent shall also be entitled to recover from such Lender or the Borrowers (without duplication), as the case may be, interest on such corresponding amount in respect of each day from the date such corresponding amount was made available by Agent to the Borrowers to the date such corresponding amount is recovered by Agent at a per annum rate equal to (i) from the Borrowers at the applicable rate for such Loan or (ii) from a Lender at the Federal Funds Effective Rate.

 

§2.9Use of Proceeds.       The Borrowers will use the proceeds of the Revolving Credit Loans, the Term Loans, and the Letters of Credit solely to (a) pay closing costs in connection with this Agreement; (b)

 

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fund the direct or indirect acquisition of additional Multifamily Properties located within the fifty (50) States  of the continental United States or the District of Columbia; (c) fund capital and construction expenditures, tenant improvements, leasing or other commissions and property and equipment acquisitions within the fifty

(50)States of the continental United States or the District of Columbia; (d) repay amounts owed under the Existing Credit Agreement; and (e) for general working capital purposes (including without limitation to finance interest shortfalls, general operating expenses, including without limitation taxes, insurance and other expenses, and the payment of fees and expenses related to the Facility).

 

§2.10Letters of Credit.

 

 

(a)

Subject to the terms and conditions set forth in this Agreement, at any time and from

time to time from the Closing Date through the day that is thirty (30) days prior to the Revolving Credit Maturity Date, the applicable Issuing Lender shall issue such Letters of Credit as the Borrowers may request upon the delivery of a written request in the form of Exhibit E hereto (a “Letter of Credit Request”) , together with an executed Availability Certificate in the form of Exhibit F, to such Issuing Lender, provided that (i) no Default or Event of Default shall have occurred and be continuing, (ii) upon issuance of such Letter of Credit, the aggregate Letter of Credit Liabilities shall not exceed the aggregate Letter of Credit Commitments and the Letter of Credit Liabilities of the applicable Issuing Lender shall not exceed such Issuing Lender’s Letter of Credit Commitment, which Letter of Credit Commitment shall be automatically increased on a pro rata basis with increases in the aggregate Revolving Credit Commitments, (iii) in no event shall the sum of (A) the Revolving Credit Loans Outstanding, (B) (without duplication) the Swing Loans Outstanding and (C) the amount of Letter of Credit Liabilities (after giving effect to all Letters of Credit requested)  exceed  the aggregate Revolving Credit Commitment, (iv) in no event shall the sum of (A) the Revolving Credit Loans Outstanding, the Swing Loans Outstanding, the Letters of Credit Liabilities (after giving effect to any  requested Letters of Credit), and the Term Loans Outstanding exceed the Total Commitment or the Facility Available Amount, (v) the conditions set forth in §10 and §11 shall have been satisfied (or if such condition is required to have been satisfied only as of the Closing Date, that such condition was satisfied as of the Closing Date) or waived by Agent, (vi) no Revolving Credit Lender is a Defaulting Lender (provided the applicable Issuing Lender may, in its sole discretion, be entitled to waive this condition), unless the applicable Issuing Lender has entered into arrangements, including the delivery of cash collateral, satisfactory to such Issuing Lender (in its sole discretion) with the Borrowers or such Defaulting Lender to eliminate such Issuing Lender’s actual or potential Fronting Exposure with respect to the Defaulting Lender arising from either the Letter of Credit then proposed to be issued or that Letter of Credit and all other Letter of Credit Liabilities as to which such Issuing Lender has actual or potential Fronting Exposure, as it may elect in its sole discretion, and (vii) in no event shall any amount drawn under a Letter of Credit be available for reinstatement or a subsequent drawing under such Letter of Credit.  The applicable Issuing Lender may assume that the conditions in §10 and

§11 have been satisfied unless it receives written notice from a Revolving Credit Lender that such conditions have not been satisfied. Each Letter of Credit Request shall be executed on behalf of the Borrowers by an Authorized Officer of the Borrowers. The Issuing Lenders shall be entitled to conclusively rely on such Person’s authority to request a Letter of Credit on behalf of the Borrowers. The Issuing Lenders shall have no duty to verify the authenticity of any signature appearing on a Letter of Credit Request.  The Borrowers  assume all risks with respect to the use of the Letters of Credit. Unless the applicable Issuing Lender and the Required Lenders otherwise consent, the term of any Letter of Credit shall not exceed a period of time commencing on the issuance of the Letter of Credit and ending one year after the date of issuance thereof, subject to extension pursuant to an “evergreen” clause reasonably acceptable to Agent and the applicable Issuing Lender (but in any event the term shall not extend beyond thirty (30) days prior to the Revolving  Credit Maturity Date unless the Borrowers have provided to Agent cash collateral reasonably acceptable to Agent in an amount equal to the Letter of Credit Liability with respect to any Letter of Credit which extends beyond thirty (30) days prior to the Revolving Credit Maturity Date). The amount available to be drawn under any Letter of Credit shall reduce on a dollar-for-dollar basis the amount available to be drawn under the aggregate Revolving Credit Commitments as a Revolving Credit Loan.

 

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(b)

Each Letter of Credit Request shall be submitted to the applicable Issuing Lender and

Agent (if Agent is not the applicable Issuing Lender) at least three (3) Business Days (or such shorter period as such Issuing Lender may approve) prior to the date upon which the requested Letter of Credit is to be issued. Each such Letter of Credit Request shall contain (i) a statement as to the purpose for which such Letter of Credit shall be used (which purpose shall be in accordance with the terms of this Agreement), and (ii) a certification by an Authorized Officer or the chief financial or chief accounting officer of Parent Guarantor that the Borrowers are and will be in compliance with all covenants under the Loan Documents after giving effect to the issuance of such Letter of Credit. The Borrowers shall further deliver to the applicable Issuing Lender such additional applications (which application as of the date hereof is in the form of Exhibit I hereto) and documents as such Issuing Lender may reasonably require, in conformity with the then standard practices of its letter of credit department applicable to all or substantially all similarly situated borrowers, in connection with the issuance of such Letter of Credit; provided that in the event of any conflict, the terms of this Agreement shall control.

 

 

(c)

The  applicable  Issuing  Lender  shall,  subject  to  the  conditions  set  forth  in   this

Agreement, issue the Letter of Credit on or before three (3) Business Days following receipt of the documents last due pursuant to §2.10(b). Each Letter of Credit shall be in form and substance reasonably satisfactory to such Issuing Lender in its reasonable discretion.

 

 

(d)

Upon  the issuance  of  a  Letter  of Credit,  each Revolving Credit  Lender  shall   be

deemed to have purchased a participation therein from the applicable Issuing Lender in an amount equal to its respective Revolving Credit Commitment Percentage of the amount of such Letter of Credit. No Revolving Credit Lender’s obligation to participate in a Letter of Credit shall be affected by any other Revolving Credit Lender’s failure to perform as required herein with respect to such Letter of Credit or any other Letter  of Credit.

 

 

(e)

Upon the issuance of each Letter of Credit, the Borrowers shall pay to the applicable

Issuing Lender (i) for its own account, a Letter of Credit fronting fee with respect to each Letter of Credit, at a rate equal to one eighth of one percent (0.125%), computed on the face amount available to be drawn under such Letter of Credit and (ii) for the accounts of the Revolving Credit Lenders (including such Issuing Lender) in accordance with their respective percentage shares of participation in such Letter of Credit, a Letter  of Credit fee calculated at the rate per annum equal to the Applicable Margin then applicable to Revolving Credit

LIBOR Rate Loans on the amount available to be drawn under such Letter of Credit. Such fees  shall be payable in quarterly installments in arrears with respect to each Letter of Credit on the first (1st) day of each calendar quarter following the date of issuance and continuing on each quarter or portion thereof thereafter, as

applicable, or on any earlier date on which the Revolving Credit Commitments shall terminate and on the expiration or return of any Letter of Credit (if such letter of credit is outstanding less than a full quarter, such fee shall be prorated for the period of time outstanding). In addition, the Borrowers shall pay to the applicable Issuing Lender for its own account within ten (10) Business Days of demand of such Issuing Lender the standard issuance, documentation and service charges applicable to all or substantially all similarly situated borrowers for Letters of Credit issued from time to time by such Issuing Lender.

 

 

(f)

In the event that any amount is drawn under a Letter of Credit by the beneficiary

thereof, the Borrowers shall reimburse the applicable Issuing Lender by having such amount drawn treated as an outstanding Revolving Credit Base Rate Loan under this Agreement (the Borrowers being deemed to have requested a Revolving Credit Base Rate Loan on such date in an amount equal to the amount of such drawing and such amount drawn shall be treated as an outstanding Revolving Credit Base Rate Loan under this Agreement) and Agent shall promptly notify each Revolving Credit Lender by telex, telecopy, telegram, telephone (confirmed in writing) or other similar means of transmission, and each Revolving Credit Lender shall promptly and unconditionally pay to Agent, for the applicable Issuing Lender’s own account, an amount equal to such Revolving Credit Lender’s Revolving Credit Commitment Percentage of such Letter of Credit  (to the extent of the amount drawn). The Borrowers further hereby irrevocably authorize and direct Agent to notify the Revolving Credit Lenders of the Borrowers’ intent to convert such Revolving Credit Base Rate Loan

 

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to a Revolving Credit LIBOR Rate Loan with an Interest Period of one (1) month on the third (3rd) Business Day following the funding by the Revolving Credit Lenders of their advance under this §2.10(f), provided that the making of such Revolving Credit LIBOR Rate Loan shall not be a contravention of any provision of this Agreement. If and to the extent any Revolving Credit Lender shall not make such amount available on the Business Day on which such draw is funded, such Revolving Credit Lender agrees to pay such amount to Agent forthwith on demand, together with interest thereon, for each day from the date on which such draw was funded until the date on which such amount is paid to Agent, at the Federal Funds Effective Rate until three (3) days after the date on which Agent gives notice of such draw and at the Federal Funds Effective Rate plus one percent (1.0%) for each day thereafter. Further, such Revolving Credit Lender shall be deemed to have assigned any and all payments made of principal and interest on its Revolving Credit Loans, amounts due with respect to its participations in Letters of Credit and any other amounts due to it hereunder to Agent to fund the amount of any drawn Letter of Credit which such Revolving Credit Lender was required to fund pursuant to this §2.10(f) until such amount has been funded (as a result of such assignment or otherwise). In the event of any such failure or refusal, the Revolving Credit Lenders not so failing or refusing shall be entitled to a priority secured position for such amounts as provided in §12.5. The failure of any Revolving Credit Lender to make funds available to Agent in such amount shall not relieve any other Revolving Credit Lender of its obligation hereunder to make funds available to Agent pursuant to this §2.10(f).

 

 

(g)

If after the issuance of a Letter of Credit   pursuant to §2.10(c) by an Issuing Lender,

but prior to the funding of any portion thereof by a Revolving Credit Lender, for any reason a drawing under a Letter of Credit cannot be refinanced as a Revolving Credit Loan, each Revolving Credit Lender will, on the date such Revolving Credit Loan pursuant to §2.10(f) was to have been made, purchase an undivided participation interest in such Letter of Credit in an amount equal to its Revolving Credit Commitment Percentage of the amount of such Letter of Credit. Each Revolving Credit Lender will immediately transfer to such Issuing Lender in immediately available funds the amount of its participation and upon receipt thereof such Issuing Lender will deliver to such Revolving Credit Lender a Letter of Credit participation certificate dated the date of receipt of such funds and in such amount.

 

 

(h)

Whenever  at  any time after  an  Issuing Lender  has  received from any   Revolving

Credit Lender any such Revolving Credit Lender’s payment of funds under a Letter of Credit and thereafter such Issuing Lender receives any payment on account thereof, then such Issuing Lender will distribute to such Revolving Credit Lender its participation interest in such amount (appropriately adjusted in the case of interest payments to reflect the period of time during which such Revolving Credit Lender’s participation interest was outstanding and funded); provided, however, that in the event that such payment received by such Issuing Lender is required to be returned, such Revolving Credit Lender will return to such Issuing Lender any portion thereof previously distributed by such Issuing Lender to it.

 

 

(i)

The issuance of any supplement, modification, amendment, renewal or extension   to

or of any Letter of Credit shall be treated in all respects the same as the issuance of a new Letter of Credit.

 

 

(j)

The Borrowers  assume  all risks  of the acts,  omissions,  or  misuse  of any Letter of

Credit by the beneficiary thereof. None of Agent, any Issuing Lender or any Lender will be responsible for (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any Letter of Credit or any document submitted by any party in connection with the issuance of any Letter of Credit, even if such document should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the form, validity, sufficiency, accuracy, genuineness or legal effect of any instrument transferring or assigning or purporting to transfer or assign any Letter of Credit or the rights or benefits thereunder or proceeds thereof in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of any beneficiary of any Letter of Credit to comply fully with the conditions required in order to demand payment under a Letter of Credit; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document or draft required by or from a beneficiary in order to make a disbursement under a Letter of Credit or the proceeds thereof; (vii) for the misapplication by the beneficiary of

 

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any Letter of Credit of the proceeds of any drawing under such Letter of Credit; and (viii) for any  consequences arising from causes beyond the control of Agent or any Lender, none of the foregoing will  affect, impair or prevent the vesting of any of the rights or powers granted to Agent, any Issuing Lender or  Lenders hereunder. In furtherance and extension and not in limitation or derogation of any of the foregoing,  any act taken or omitted to be taken by Agent, any Issuing Lender or any other Lender in good faith will be binding on the Borrowers and will not put Agent, any Issuing Lender or any other Lender under any resulting liability to the Borrowers; provided nothing contained herein shall relieve any Issuing Lender, Agent or any other Lender for liability to the Borrowers arising as a result of the gross negligence or willful misconduct of such Issuing Lender, Agent or such Lender, as applicable, as determined by a court of competent jurisdiction after the exhaustion of all applicable appeal periods.

 

§2.11Increase in Total Commitment.

 

 

(a)

Provided that no Default or Event of Default has occurred and is continuing,   subject

to the terms and conditions set forth in this §2.11, the Borrowers shall have the option at any time and from time to time before the date that is thirty (30) days prior to the applicable Maturity Date (or the extended Revolving Credit Maturity Date, as applicable, if the Borrowers exercise their extension option pursuant to

§2.12) to request an increase in the Total Commitment to an amount not greater than Five Hundred Million Dollars ($500,000,000.00) by giving written notice to Agent (an “Increase Notice”; and the amount of such requested increase is a “Commitment Increase”), with such Commitment Increase being allocated to the Revolving Credit Facility and/or the Term Loan Facility in such fashion as the Borrowers may designate; provided that any such individual Commitment Increase must be in a minimum amount of $25,000,000.00; provided further that the Borrower will have the right (to be exercised only one time during the term of the Facility) to designate a Commitment Increase as an Incremental Term Loan Facility in accordance with §2.13, in which case the provisions of §2.13 shall apply to such Commitment Increase. The principal amount of such Incremental Term Loan Facility shall be part of, and not in addition to, the Total Commitment (with any such Incremental Term Loan Facility resulting in a corresponding reduction in the future Commitment Increases available under this §2.11). Agent shall send a notice to all Lenders (the “Additional Commitment Request Notice”) informing them of the Borrowers’ request to increase the Total Commitment, the applicable Facility to be increased. Each Lender who desires to provide an additional Commitment upon such terms shall provide Agent with a written commitment letter specifying the amount of the additional Commitment by which it is willing to provide prior to such deadline as may be specified in the Additional Commitment Request Notice.   If the requested increase is oversubscribed then Agent and Arrangers shall allocate the Commitment Increase among such Lenders who provide such commitment letters on such basis mutually acceptable to each of the Borrowers, Agent and Arrangers. If the additional Commitments so provided are not sufficient to provide the full amount of the Commitment Increase requested by the Borrowers, then Agent, Arrangers or the Borrowers may, but shall not be obligated to, invite, and Agent, in consultation with Parent Borrower, will use its reasonable efforts to arrange for, one or more banks or lending institutions (which banks or lending institutions shall be reasonably acceptable to Agent, Arrangers and Parent Borrower) to become a Lender and provide an additional Commitment (each such Lender, an “Acceding Lender”). Agent shall promptly provide all Lenders and Acceding Lenders with a notice setting forth the amount, if any, of the additional Commitment to be provided by each Lender and Acceding Lender and the revised Commitment Percentages (as well as the  revised Maximum Facility Amount and the revised amount of the Letter of Credit Commitment and the Swing Loan Commitment, respectively) which shall be applicable after the effective date of the Commitment Increase specified therein (the “Commitment Increase Date”). In no event shall any Lender be obligated to provide an additional Commitment.

 

 

(b)

On  any  Commitment  Increase  Date  the   outstanding   principal  balance  of     the

applicable Loans shall be reallocated among the Lenders (including any Acceding Lenders) such that after the applicable Commitment Increase Date the outstanding principal amount of Loans owed to each Lender shall be equal to such Lender’s Revolving Credit Commitment Percentage and/or Term Loan Commitment Percentage, as applicable, (as in effect after the applicable Commitment Increase Date) of the outstanding principal amount of  all  applicable  Loans.   The  participation interests  of  the  Revolving Credit  Lenders  in Swing  Loans and

 

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Letters of Credit shall be similarly adjusted as applicable. On any Commitment Increase Date those Lenders whose applicable Commitment Percentage is increasing shall advance the funds to Agent and the funds so advanced shall be distributed among the Lenders whose applicable Commitment Percentage is decreasing as necessary to accomplish the required reallocation of the outstanding Loans. The funds so advanced shall be Base Rate Loans until converted to LIBOR Rate Loans which are allocated among all Lenders based on their applicable Revolving Credit Commitment Percentages and/or Term Loan Commitment Percentages, after giving effect to any Commitment Increase, as reasonably determined by Agent.

 

 

(c)

Upon the effective date of each increase in the Total Commitment pursuant to this

§2.11, each Acceding Lender shall become a Lender party to this Agreement as of such date and shall execute an accession agreement in form and substance reasonably satisfactory to Parent Borrower and Agent (each, an Accession Agreement”) Agent may unilaterally revise Schedule 1.1 and the Borrowers shall, if requested by such Lender, execute and deliver to Agent new Notes for each Lender whose Commitment has changed so that the principal amount of such Lender’s applicable Notes shall equal its Commitment. Agent shall deliver such replacement Notes (or new Notes, in the case of Acceding Lenders) to the respective Lenders in exchange for the Notes replaced thereby (if applicable) which shall be surrendered by such Lenders. Such new Notes shall  (if applicable) provide that they are replacements for the surrendered Notes and (if applicable) that they do not constitute a novation, shall be dated as of the Commitment Increase Date and shall otherwise be in  substantially the form of Exhibit A-2 hereto.

 

 

(d)

Notwithstanding anything to the contrary contained herein, any obligation of   Agent

and Lenders to increase the Total Commitment pursuant to this §2.11 shall be conditioned upon satisfaction or waiver of the following conditions precedent which must be satisfied or waived prior to the effectiveness of  any increase of the Total Commitment:

 

(i)Payment of Activation Fee. The Borrowers shall pay to Agent those fees described in and contemplated by the Agreement Regarding Fees with respect to the applicable Commitment Increase; and

 

(ii)No Default. On the date any Increase Notice is given and on the date such increase becomes effective, both immediately before and after the Total Commitment is increased, no Default or Event of Default shall have occurred and be continuing; and

 

(iii)Representations True. The representations and warranties made by the Borrowers and Guarantors, respectively, in the Loan Documents or otherwise made by or on behalf of the Borrowers and Guarantors, respectively, in connection therewith shall also be true and correct in all material respects on the date of such Increase Notice and on the date the Total Commitment is increased, both immediately before and after the Total Commitment is increased (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct only as of such specified date); and

 

(iv)Additional Documents and Expenses. The Borrowers and Guarantors shall execute and deliver to Agent and Lenders such additional documents and opinions as Agent may reasonably require, including, without limitation, a Compliance Certificate, demonstrating compliance with all covenants set forth in the Loan Documents after giving effect to the increase, a certificate signed on behalf of Parent Borrower by an Authorized Officer confirming the statements in clauses (ii) and (iii) of this §2.11(d), and the Borrowers shall pay the cost of any reasonable and documented fees, taxes or expenses which are reasonably requested in connection with such increase.

 

§2.12   Extension of Revolving Credit Maturity Date.  The Borrowers shall have the right and option to extend the Revolving Credit Maturity Date to November 1, 2021, and then to May 1, 2022, upon satisfaction or waiver (with any such waiver requiring the approval of all Lenders) of the following conditions   precedent,

 

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which must be satisfied (or so waived) prior to the effectiveness of any extension of the Revolving Credit Maturity Date:

 

 

(a)

Extension Request.   The Borrowers shall deliver written notice of such request   (the

Extension Request”) to Agent not earlier than the date which is one hundred twenty (120) days and not later than the date which is sixty (60) days prior to the then applicable Revolving Credit Maturity Date (as determined without regard to such extension). Any such Extension Request shall be irrevocable and binding  on the Borrowers unless otherwise agreed to by Agent in its reasonable discretion.

 

 

(b)

Payment  of Extension Fee.The Borrowers shall  pay  to  Agent  for  the pro   rata

accounts of the Revolving Credit Lenders in accordance with their respective Revolving Credit Commitments an extension fee in an amount equal to seven and one-half (7.50) basis points on the aggregate Revolving Credit Commitments of the Revolving Credit Lenders in effect on the then applicable Revolving Credit Maturity Date, after taking into consideration any reduction in the Revolving Credit Commitments as of such date (as determined without regard to such extension), which fee shall, when paid, be fully earned and non- refundable.

 

 

(c)

No Default.   On the date the Extension Request is given and on the then   applicable

Maturity Date (as determined without regard to such extension) no Default or Event of Default shall have occurred and be continuing, and the Borrowers shall deliver to Agent a certificate signed on behalf of Parent Borrower by an Authorized Officer stating the same.

 

 

(d)

Prior Extension.       For the extension to May 1, 2022, the extension to November 1,

2021 shall have been previously effected.

 

 

(e)

Representations  and Warranties.   The  representations  and  warranties  made by the

Borrowers and Guarantors, respectively, in the Loan Documents or otherwise made by or on behalf of the Borrowers and Guarantors, respectively, in connection therewith shall be true and correct in all material respects on the date the Extension Request is given and on the then applicable Revolving Credit Maturity Date (as determined without regard to such extension), it being understood and agreed that any representation or  warranty which by its terms is made as of a specified date shall be required to be true and correct only as of such specified date, and the Borrowers shall deliver to Agent a certificate signed on behalf of Parent Borrower by an Authorized Officer stating the same.

 

§2.13Incremental Term Loan Facility.

 

 

(a)

In accordance with §2.11, the Borrowers may, at any time (but no more than once

during the term of the Facility), by written notice to the Administrative Agent, request that a portion of the available Commitment Increases permitted under §2.11 be designated as a single incremental term loan (an “Incremental Term Loan Facility”) to be made available by the existing Lenders and/or Additional Incremental Term Loan Lenders, and to be effective as of the date specified in such notice (the “Incremental Term Loan Date”) as specified in the related notice to Agent; provided, however, that (i) in no event shall the amount of the Incremental Term Loan Facility be less than $25,000,000 or, when combined with any and all prior Commitment Increases, result in the Total Commitment exceeding Five Hundred Million Dollars ($500,000,000), (ii) the maturity date of the Incremental Term Loan Facility shall be the date occurring five (5) years following the Incremental Term Loan Date, or such earlier date on which the Loans shall become due  and payable pursuant to the terms hereof by virtue of the occurrence of an Event of Default (the “Incremental Term Loan Maturity Date”) and (iii) the Incremental Term Loan Facility shall otherwise be on terms identical to the Facility. In no event shall any Lender be required to participate in the Incremental Term Loan Facility.

 

 

(b)

The  notice from the Borrowers  pursuant  to this  §2.13  shall  set forth the requested

amount and proposed terms of the Incremental Term Loan Facility. The Incremental Term Loan Facility may be  made  by any  existing Lender  (it  being  understood that  no existing  Lender  shall  have any obligation to

 

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commit to fund any portion of the Incremental Term Loan Facility unless it shall otherwise agree nor shall the Borrowers be obligated to offer any such Lender the opportunity to fund any portion of the Incremental Term Loan Facility) or by any other banks or lending institutions that are reasonably acceptable to Agent, Arrangers and Parent Borrower (any such other Person being called an “Additional Incremental Term Loan Lender”).

 

 

(c)

Commitments  in  respect  of  the  Incremental  Term  Loan  Facility  shall     become

Commitments under this Agreement pursuant to an amendment (the “Incremental Term Loan Amendment”) to this Agreement and, as appropriate, the other Loan Documents, executed by the Loan Parties, each Incremental Term Loan Lender and Agent. The Incremental Term Loan Amendment may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of Administrative Agent and the Borrowers, to effect the provisions of this §2.13. Subject to the provisions of this §2.13 and notwithstanding the provisions of §27, no approval from the Required Lenders or all Lenders will be required in connection with the implementation of the Incremental Term Loan Facility and Agent and the Incremental Term Loan Lenders providing the Incremental Term Loan Facility shall be permitted to enter into such amendments to the Loan Documents as are necessary to  give effect to the Incremental Term Loan Facility.

 

 

(d)

[Reserved.]

 

 

(e)

[Reserved.]

 

§3REPAYMENT OF THE LOANS.

 

§3.1   Stated Maturity.   The Borrowers promise to pay (a) on the Revolving Credit Maturity Date    and there shall become absolutely due and payable on the Revolving Credit Maturity Date all of the Revolving Credit Loans, Swing Loans and Letter of Credit Liabilities outstanding on such date (other than Letters of Credit whose expiration date is beyond the Revolving Credit Maturity Date as set forth in §2.10(a)), (b) on the Term Loan Maturity Date and there shall become absolutely due and payable on the Term Loan Maturity Date all of the Term Loans (other than the Incremental Term Loan, if any) outstanding on such date and (c) on the Incremental Term Loan Maturity Date, the Incremental Term Loan, if any, outstanding on such date, in each case together with any and all accrued and unpaid interest thereon.

 

§3.2Mandatory Prepayments.

 

 

(a)

The Borrowers shall, if applicable, within five (5) Business Days after the earlier   of

the date on which (i) a Responsible Officer of Parent Borrower has knowledge of any non-compliance with the requirements described in the following clauses (A), (B), (C), (D), (E), (F) or (G) or (ii) written notice of any such non-compliance shall have been given to the Borrowers by Agent, prepay an aggregate principal amount of the Loans or any other Indebtedness in an amount sufficient to cause (A) the Aggregate Credit Exposure not to exceed the Maximum Facility Amount on such Business Day, (B) the Revolving Credit Exposure not to exceed the Revolving Credit Facility Amount on such Business Day, (C) the Letter of Credit Liabilities not to exceed the Letter of Credit Commitments as of such Business Day, (D) the Term Loan Exposure not to exceed the Term Loan Facility Amount, (E) the Consolidated Leverage Ratio not to exceed the applicable maximum Consolidated Leverage Ratio set forth in §9.1 on such Business Day, (F) the Unsecured Leverage Ratio not to exceed the applicable maximum Unsecured Leverage Ratio set forth in §9.9 on such Business Day and (G) the Unencumbered Assets Debt Service Coverage Ratio not to be less than the minimum Unencumbered Assets Debt Service Coverage Ratio set forth in §9.10 on such Business Day.

 

 

(b)

Prepayments of the Facility made pursuant to §3.2(a) shall first be applied to the

Revolving Credit Facility and then to the Term Loan Facility, in each case on a pro rata basis based on the principal amount, as of the date of the applicable prepayment, of outstanding Loans pertaining to the  applicable Facility (except that the amount of any Swing Loans shall be paid solely to the Swing Loan Lenders); provided, however, that such prepayments shall, at the option of the Borrowers, first be applied to

 

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each Facility and the Letter of Credit Obligations to cure any non-compliance relating thereto. Any  prepayment amounts remaining thereafter shall be deposited into the LC Cash Collateral Account, in an amount up to the LC Exposure as security for the Obligations. Upon the drawing of any Letter of Credit for which funds are on deposit in the LC Cash Collateral Account, such funds shall be applied to reimburse the applicable Issuing Lender or Lenders, as applicable. All prepayments under this §3.2 shall be made together with accrued interest to the date of such prepayment on the principal amount prepaid, together with any additional amounts payable pursuant to §4.8.

 

 

(c)

To the  extent the funds  on deposit in the  LC Cash Collateral Account  shall at   any

time exceed the total amount required to be deposited therein pursuant to the terms of this Agreement, Agent shall, promptly upon request by Parent Borrower and provided that no Default or Event of Default shall then have occurred or be continuing or would result therefrom, return such excess amount to the Borrowers.

 

§3.3Optional Prepayments.

 

 

(a)

The  Borrowers  shall  have  the  right,  at  their  election,  to  prepay  the outstanding

amount of the Loans and Swing Loans, as a whole or in part, at any time without penalty or premium;  provided, that if any prepayment of the outstanding amount of any LIBOR Rate Loans pursuant to this §3.3 is made on a date that is not the last day of the Interest Period relating thereto, such prepayment shall be accompanied by the payment of any amounts due pursuant to §4.8.

 

 

(b)

The Borrowers shall give Agent, no later than 1:00 p.m. (Eastern time) at least three

(3)days’ prior written notice of any prepayment pursuant to this §3.3, in each case specifying the proposed date of prepayment of the Loans and the principal amount to be prepaid (provided that (i) any such notice may be revoked or modified upon one (1) day’s prior notice to Agent) and/or (ii) any such notice or repayment may be conditioned upon the consummation of a transaction. Notwithstanding the foregoing, no prior notice shall be required for the prepayment of any Swing Loan.

 

§3.4 Partial Prepayments. Each partial prepayment of the Loans under §3.3 shall be in a minimum amount of $100,000.00, shall be accompanied by the payment of accrued interest on the principal prepaid to the date of payment. Each partial payment under §3.2 and §3.3 shall be applied first to the principal of any Outstanding Swing Loans (pro rata to each Swing Loan Lender based upon the ratio of such Swing Loan Lender’s Swing Loan Commitment to the total Swing Loan Commitments of all of the Swing Loan Lenders), and then, in the absence of instruction by the Borrowers, first, to the principal of the Revolving Credit Loans and second to the Term Loans (and with respect to each Type of Loan, first to the principal of Base Rate Loans, and then to the principal of LIBOR Rate Loans).

 

§3.5 Effect of Prepayments.  Amounts of the Revolving Credit Loans prepaid under §3.2 and §3.3  prior to the Revolving Credit Maturity Date may be reborrowed as provided in §2. Amounts of  the  Term Loans prepaid under §3.2 and §3.3 prior to the Term Loan Maturity Date or Incremental Term Loan Maturity Date, as applicable, may not be reborrowed. ).

 

§3.6Sharing of Payments, Etc..

 

 

(a)

Sharing Within Each Facility.   Subject to the provisions   of §12.5, if, in connection

with any particular Facility, any Applicable Lender shall obtain at any time any payment (whether voluntary, involuntary, through the exercise of any right of set-off, or otherwise, other than as a result of an assignment pursuant to §18 (i) on account of Obligations due and payable to such Applicable Lender with respect to such Facility under the Loan Documents at such time in excess of its ratable share (according to the proportion of

(x) the amount of such Obligations due and payable to such Applicable Lender at such time  to  (y) the aggregate amount of the Obligations due and payable to all Applicable Lenders with respect to such Facility under the Loan Documents at such time) of payments on account of the Obligations due and payable to all  such Applicable Lenders under the Loan Documents at such time obtained by all such Applicable Lenders at

 

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such time or (ii) on account of Obligations owing (but not due and payable) to such Applicable Lender under the Loan Documents at such time in excess of its ratable share (according to the proportion of (x) the amount  of such Obligations owing to such Applicable Lender at such time to (y) the aggregate amount of the Obligations owing (but not due and payable) to all such Applicable Lenders hereunder at such time) of payments on account of the Obligations owing (but not due and payable) to all such Applicable Lenders under the Loan Documents at such time obtained by all of such Applicable Lenders at such time, such Applicable Lender shall forthwith purchase from such other Applicable Lenders such interests or participating interests in the Obligations due and payable or owing to them, as the case may be, as shall be necessary to cause such purchasing Applicable Lender to share the excess payment ratably with each of them; provided, however, that if all or any portion of such excess payment is thereafter recovered from such purchasing Applicable Lender, such purchase from each other Applicable Lender shall be rescinded and such other Applicable Lender shall repay to the purchasing Applicable Lender the purchase price to the extent of such Applicable Lender’s ratable share (according to the proportion of (x) the purchase price paid to such Applicable Lender to (y) the aggregate purchase price paid to all Applicable Lenders) of such recovery together with an amount equal to such Applicable Lender’s ratable share (according to the proportion of (x) the amount of such other Applicable Lender’s required repayment to (y) the total amount so recovered from the purchasing Applicable Lender) of any interest or other amount paid or payable by the purchasing Applicable Lender in respect of the total  amount so recovered. The Borrowers agree that any Applicable Lender so purchasing an interest or participating interest from another Applicable Lender pursuant to this §3.6(a) may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off) with respect to such interest or participating interest, as the case may be, as fully as if such Applicable Lender were the direct creditor of  the Borrowers in the amount of such interest or participating interest, as the case may be.

 

 

(b)

Pro Rata Sharing Following an Event of Default.  Notwithstanding §3.6(a), following

the occurrence and during the continuance of any Event of Default, subject to the provisions of §12.5, if any Lender shall obtain at any time any payment (whether voluntary, involuntary, through the exercise of any right of set off, or otherwise, other than as a result of an assignment pursuant to §18) (i) on account of Obligations due and payable to such Lender under the Loan Documents at such time in excess of its ratable share (according to the proportion of (x) the amount of such Obligations due and payable to such Lender at such time to (y) the aggregate amount of the Obligations due and payable to all Lenders under the Loan Documents at such time) of payments on account of the Obligations due and payable to all Lenders under the Loan Documents at such time obtained by all Lenders at such time or (ii) on account of Obligations owing (but not due and payable) to such Lender under the Loan Documents at such time in excess of its ratable share (according to the proportion of (x) the amount of such Obligations owing to such Lender at such time to (y) the aggregate amount of the Obligations owing (but not due and payable) to all Lenders under the Loan  Documents at such time) of payments on account of the Obligations owing (but not due and payable) to all Lenders under the Loan Documents at such time obtained by all of the Lenders at such time, such Lender shall forthwith purchase from the other Lenders such interests or participating interests in the Obligations due and payable or owing to them, as the case may be, as shall be necessary to cause such purchasing Lender to share the excess payment ratably with each of them; provided, however, that if all or any portion of such excess payment is thereafter recovered from such purchasing Lender, such purchase from each other Lender shall be rescinded and such other Lender shall repay to the purchasing Lender the purchase price to the extent of such Lender’s ratable share (according to the proportion of (x) the purchase price paid to such Lender to (y) the aggregate purchase price paid to all Lenders) of such recovery together with an amount equal to such Lender’s ratable share (according to the  proportion  of (x) the amount  of  such  other  Lender’s  required repayment   to

(y)the total amount so recovered from the purchasing Lender) of any interest or other amount paid or payable by the purchasing Lender in respect of the total amount so recovered. The Borrowers agree that any Lender so purchasing an interest or participating interest from another Lender pursuant to this §3.6(b) may, to the fullest extent permitted by law, exercise all its rights of payment (including the right of set-off) with respect to such interest or participating interest, as the case may be, as fully as if such Lender` were the direct creditor of the Borrowers in the amount of such interest or participating interest, as the case may be.

(y)

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§4CERTAIN GENERAL PROVISIONS.

 

§4.1Conversion Options.

 

 

(a)

The Borrowers may elect from time to time to convert any of the outstanding   Loans

to a Loan of another Type and such Loans shall thereafter bear interest as a Base Rate Loan or a LIBOR Rate Loan, as applicable; provided that (i) with respect to any such conversion of a LIBOR Rate Loan to a Base  Rate Loan, the Borrowers shall give Agent at least one (1) Business Day’s prior written notice of such election, and such conversion shall only be made on the last day of the Interest Period with respect to such LIBOR Rate Loan unless the Borrowers pay Breakage Costs as required under this Agreement; (ii) with respect to any such conversion of a Base Rate Loan to a LIBOR Rate Loan, the Borrowers shall give Agent at least three (3) LIBOR Business Days’ prior written notice of such election and the Interest Period requested for such Loan,  the principal amount of the Loan so converted shall be in a minimum aggregate amount of $100,000.00 and, after giving effect to the making of such Loan, there shall be no more than seven (7) LIBOR Rate Loans outstanding at any one time; and (iii) no Loan may be converted into a LIBOR Rate Loan when any Default or Event of Default has occurred and is continuing. All or any part of the outstanding Loans of any Type may be converted as provided herein, provided that no partial conversion shall result in a Base Rate Loan in a principal amount of less than $100,000.00 or a LIBOR Rate Loan in a principal amount of less than $100,000.00.  On  the date on which such conversion is being made, each Lender shall take such action as is necessary to transfer its Commitment Percentage of such Loans to its Domestic Lending Office or its LIBOR Lending Office, as the case may be. Each Conversion/Continuation Request relating to the conversion of a Base Rate Loan to a LIBOR Rate Loan shall be irrevocable by the Borrowers.

 

 

(b)

Any  LIBOR  Rate Loan  may be continued as  such Type  upon the expiration of an

Interest Period with respect thereto by compliance by the Borrowers with the terms of this §4.1; provided that no LIBOR Rate Loan may be continued as such when any Default or Event of Default has occurred and is continuing, but shall be automatically converted to a Base Rate Loan on the last day of the Interest Period relating thereto ending during the continuance of any Default or Event of Default.

 

 

(c)

In the event that the Borrowers do not notify Agent of their election hereunder   with

respect to any LIBOR Rate Loan, such Loan shall be automatically continued at the end of the applicable Interest Period as a LIBOR Rate Loan for an Interest Period of one (1) month unless such Interest Period shall be greater than the time remaining until the applicable Maturity Date, in which case such Loan shall be automatically converted to a Base Rate Loan at the end of the applicable Interest Period.

 

§4.2 Fees. In addition to all fees specified herein, the Borrowers agree to pay to KeyBank and Arrangers for their own account certain fees for services rendered or to be rendered in connection with the Loans as provided pursuant to a fee letter dated March 29, 2017 between Parent Borrower, KeyBank and Arrangers (the “Agreement Regarding Fees”).

 

§4.3[Reserved].

 

§4.4Funds for Payments.

 

 

(a)

All payments of principal, interest, facility fees, closing fees and any other   amounts

due hereunder or under any of the other Loan Documents shall be made to Agent, for the respective accounts   of Lenders and Agent, as the case may be, at Agent’s Head Office, not later than 3:00 p.m. (Eastern time) on the day when due (or such later time as is acceptable to Agent in the event of a payment in full of all Loans and a termination of Commitments hereunder), in each case in lawful money of the United States in immediately available funds. Subject to the foregoing, all payments made to Agent on behalf of Lenders, and actually received by Agent, shall be deemed received by Lenders on the date actually received by Agent.

 

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(b)

All   payments  by  the  Borrowers  hereunder  and  under  any  of   the  other     Loan

Documents shall be made without setoff or counterclaim and free and clear of and without deduction or  withholding for any Taxes, excluding any income or gross receipts Taxes, franchise or similar Taxes and any Taxes imposed by a jurisdiction (i) as a result of Agent or Lender being organized under the laws of, or having its principal office or, in the case of any Lender, its applicable lending office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) as a result of any present or former connection between Agent or a Lender and such jurisdiction other than any connection arising solely from executing, delivering, becoming a party to, performing its obligations under, receiving any payments under, engaging in any other transaction pursuant to, or enforcing any Loan Document, or selling, pledging, assigning or granting  a security interest in, any Loan Document (such Taxes, other than those so excluded as specifically set forth in this sentence and elsewhere in this §4.4(b), referred to as Non-Excluded Taxes”), unless the Borrowers are required by law to make such deduction or withholding. If any such obligation is imposed upon the Borrowers with respect to any amount payable by the Borrowers hereunder or under any of the other Loan Documents,   the Borrowers will pay to Agent, for the account of Lenders (including the Swing Loan Lenders) or (as the  case may be) Agent, on the date on which such amount is due and payable hereunder or under such other Loan Document, such additional amount in Dollars as shall be necessary to enable Lenders or Agent to receive, after such deduction or withholding has been made, the same net amount which Lenders or Agent would have received on such due date had no such obligation been imposed upon the Borrowers; provided, however, that the Borrowers shall not be required to increase any such amounts payable to any Lender with respect to any Non-Excluded  Taxes  (i)  that  are attributable to such Lender’s  failure to comply  with the requirements     of

§4.4(c); (ii) that are branch profits taxes imposed by the United States or any similar taxes imposed by any other jurisdiction under the laws of which a Lender is organized or in which its applicable lending office is located; (iii) in the case of a Non-U.S. Lender and notwithstanding any consent given pursuant to §18.1, that are imposed on amounts payable to such Lender pursuant to a law in effect on the date on which such Lender becomes a party to this Agreement (or designates a new lending office), except to the extent that such 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  Borrowers  with respect  to such Non-Excluded Taxes  pursuant  to this

§4.4(b); or (iv) that are U.S. federal withholding Taxes imposed under FATCA. The Borrowers  shall indemnify each of Agent and Lenders, as applicable, within 10 days after demand therefor, for the full amount of any Non-Excluded Taxes (including Non-Excluded Taxes imposed or asserted on or attributable to amounts payable under this §4) payable or paid by Agent or Lenders or required to be withheld or deducted from a payment to Agent or Lenders and any reasonable expenses arising therefrom or with respect thereto, whether  or not such Non-Excluded 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 Borrowers by a Lender (with a copy to Agent), or by Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error. The Borrowers will deliver promptly to Agent certificates or other valid vouchers for all Taxes or other charges deducted from or paid with respect to payments made by the Borrowers hereunder or under  any other Loan Document. In the event a Lender receives a refund or credit of any Non-Excluded Taxes paid  by the Borrowers pursuant to this section, such Lender will pay to the Borrowers the amount of such refund or credit (and any interest received with respect thereto) promptly upon receipt thereof; provided that if at any time thereafter such Lender is required to return such refund or credit, the Borrowers shall promptly repay to such Lender the amount of such refund or credit, net of any reasonable incremental additional costs.

 

 

(c)

If a  Lender is  entitled to an exemption from or  reduction of withholding Tax   with

respect to payments made under any Loan Document, such Lender shall deliver to the Borrowers, at the time  or times reasonably requested by the Borrowers, such properly completed and executed documentation reasonably requested by the Borrowers as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, if reasonably requested by the Borrowers such Lender shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrowers as  will enable the Borrowers to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding the generality of the foregoing, each Lender that is not a  United States Person (as such term is defined in Section 7701(a)(30) of the Code) for U.S. federal income tax  purposes (a Non-U.S. Lender”), to the extent such Lender is lawfully able to do so, shall provide the

 

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Borrowers on or prior to the Closing Date (in the case of each Lender listed on the signature pages hereof on the Closing Date) or on or prior to the date of the Assignment and Acceptance Agreement or Accession Agreement pursuant to which it becomes a Lender (in the case of each other Lender), and at such other times  as may be necessary in the determination of the Borrowers, with (x) two (2) original copies of Internal  Revenue Service Form W-8BEN, W-8BEN-E, W-8ECI and/or W-8IMY (or, in each case, any successor forms), properly completed and duly executed by such Lender, and any other such duly executed form(s) or statement(s) (including whether such Lender has complied with the FATCA) which may, from time to time, be prescribed by law and, which, pursuant to applicable provisions of (i) an income tax treaty between the United States and the country of residence of such Lender, (ii) the Code, or (iii) any applicable rules or regulations in effect under (i) or (ii) above, establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to any payments to such Lender of principal, interest, fees or other amounts payable under any of the Loan Documents, or (y) if such Lender is not a “bank” or other Person described in Section 881(c)(3) of the Code, a Certificate Regarding Non-Bank Status together with two (2) original copies of Internal Revenue Service Form W-8BEN or W-8BEN-E (or any successor form), properly completed and duly executed by such Lender, and such other documentation required under the Code and requested by the Borrowers to establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to any payments to such Lender of interest payable under any of the Loan Documents. Each Lender that is a United States Person (as such term is defined in Section 7701(a)(30)  of the Code) for United States federal income tax purposes (a “U.S. Lender”) shall provide the Borrowers on  or prior to the Closing Date (or, if later, on or prior to the date on which such Lender becomes a party to this Agreement) two (2) original copies of Internal Revenue Service From W-9 (or any successor form), properly completed and duly executed by such Lender, certifying that such U.S. Lender is entitled to an exemption from United States backup withholding tax, or otherwise prove that it is entitled to such an exemption. If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA  (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Borrowers at the time or times prescribed by law and at such time or times reasonably requested by the Borrowers such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrowers as may be necessary for the Borrowers to comply with their obligations under FATCA and to determine that such Lender has complied with such Lender’s obligations under FATCA or to determine the amount to deduct and withhold from such payment (for purposes of this sentence, “FATCA” shall include any amendments made to FATCA after the date of this Agreement). Each Lender required to deliver any forms, certificates or other evidence with respect to United States federal income tax withholding matters pursuant to this section hereby agrees, from time to time after the initial delivery by such Lender of such forms, certificates or other evidence, whenever a lapse in time or change in circumstances renders such forms, certificates or other evidence obsolete or inaccurate in any material respect, that such Lender shall promptly provide the Borrowers two (2) new original copies of Internal Revenue Service Form W-9, W-8BEN, W-8BEN-E, W-8ECI and/or W-8IMY (or,  in each case, any successor form), a Certificate Regarding Non-Bank Status and two (2) original copies of Internal Revenue Service Form W-8BEN or W-8BEN-E (or any successor form), or any documentation required under applicable reporting requirements of FATCA, as the case may be, properly completed and duly executed by such Lender, and such other documentation required under the Code and requested by the Borrowers to confirm or establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to payments to such Lender under the Loan Documents, or notify the Borrowers of its inability to deliver any such forms, certificates or other evidence.

 

 

(d)

In the  event  it  is  reasonably necessary to  determine  the  fair  market  value  of the

Commitments, Loans and/or other obligations under the Loan Documents for purposes of Treasury Regulation Section 1.1273-2(f), Agent shall assist Parent Borrower as reasonably requested in connection with making such determination (including by using commercially reasonable efforts to obtain quotes and sales prices for the Commitments, Loans and/or other obligations), and Agent shall promptly make any such determination by Parent Borrower available to Lenders in accordance with Treasury Regulation Section 1.1273-2(f)(9).

 

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(e)

The  obligations  of  the  Borrowers  to  Lenders  under  this  Agreement  (and  of the

Revolving Credit Lenders to make payments to the Issuing Lenders with respect to Letters of Credit and to the Swing Loan Lenders with respect to Swing Loans) shall be absolute, unconditional and irrevocable, and shall be paid and performed strictly in accordance with the terms of this Agreement, under all circumstances whatsoever, including, without limitation, the following circumstances: (i) any lack of validity or  enforceability of this Agreement, any Letter of Credit, or any of the other Loan Documents; (ii) any improper use which may be made of any Letter of Credit or any improper acts or omissions of any beneficiary or transferee of any Letter of Credit in connection therewith; (iii) the existence of any claim, set-off, defense or any right which the Borrowers or any of their Subsidiaries or Affiliates may have at any time against any beneficiary or any transferee of any Letter of Credit (or persons or entities for whom any such beneficiary or any such transferee may be acting) or Lenders (other than the defense of payment to Lenders in accordance with the terms of this Agreement) or any other Person, whether in connection with any Letter of Credit, this Agreement, any other Loan Document, or any unrelated transaction; (iv) any draft, demand, certificate, statement or any other documents presented under any Letter of Credit proving to be insufficient, forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect whatsoever; (v) any breach of any agreement between the Borrowers or any of their Subsidiaries or Affiliates and any beneficiary or transferee of any Letter of Credit; (vi) any irregularity in the transaction with respect to which any Letter of Credit is issued, including any fraud by the beneficiary or any transferee of such Letter of Credit; (vii) payment by an Issuing Lender under any Letter of Credit against presentation of a sight draft, demand, certificate or other document which does not comply with the terms of such Letter of Credit, provided that such payment shall not have constituted gross negligence or willful misconduct on the part of such Issuing Lender as determined by a court of competent jurisdiction after the exhaustion of all applicable appeal periods;

(viii)any non-application or misapplication by the beneficiary of a Letter of Credit of the proceeds of such Letter of Credit; (ix) the legality, validity, form, regularity or enforceability of the Letter of Credit; (x) the failure of any payment by an Issuing Lender to conform to the terms of a Letter of Credit (if, in such Issuing Lender’s good faith judgment, such payment is determined to be appropriate); (xi) the surrender or impairment of any security for the performance or observance of any of the terms of any of the Loan Documents; (xii) the occurrence of any Default or Event of Default; and (xiii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, provided that nothing contained herein shall relieve any Issuing Lender, Agent or any Lender for liability to the Borrowers arising as a result of gross negligence or willful misconduct on the part of such Issuing Lender, Agent, any Lender or any Swing Loan Lender, as applicable, as determined by a court of competent jurisdiction after the exhaustion of all applicable appeal periods.

 

§4.5 Computations. All computations of interest on the Loans and of other fees to the extent  applicable shall be based on a 360-day year and paid for the actual number of days elapsed. Except as otherwise provided in the definition of the term “Interest Period” with respect to LIBOR Rate Loans, whenever a payment hereunder or under any of the other Loan Documents becomes due on a day that is not a Business Day, the due date for such payment shall be extended to the next succeeding Business Day, and interest shall accrue during such extension. The Outstanding Loans and Letter of Credit Liabilities as reflected on the records of Agent from time to time shall be considered prima facie evidence of such amount.

 

§4.6  Suspension of LIBOR Rate Loans.  In the event that,  prior to the commencement  of any  Interest Period relating to any LIBOR Rate Loan, Agent shall determine that adequate and reasonable methods do not exist for ascertaining LIBOR for such Interest Period, or Agent shall reasonably determine that LIBOR will not accurately and fairly reflect the cost of Lenders making or maintaining LIBOR Rate Loans for such Interest Period, Agent shall forthwith give notice of such determination (which shall be conclusive and binding on the Borrowers and Lenders absent manifest error) to the Borrowers and Lenders. In such event (a) any  Loan Request with respect to a LIBOR Rate Loan shall be automatically withdrawn and shall be deemed a request for a Base Rate Loan and (b) each LIBOR Rate Loan will automatically, on the last day of the then current Interest Period applicable thereto, become a Base Rate Loan, and the obligations of Lenders to make LIBOR Rate Loans shall be suspended until Agent determines that the circumstances giving rise to such suspension no longer exist, whereupon Agent shall so notify the Borrowers and Lenders promptly after such determination.

 

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§4.7 Illegality. Notwithstanding any other provisions herein, if any Change in Law shall make it unlawful, or any central bank or other governmental authority having or claiming jurisdiction over a Lender or its LIBOR Lending Office shall assert that it is unlawful, for any Lender to make or maintain LIBOR Rate Loans, such Lender shall forthwith give notice of such circumstances to Agent and the Borrowers and thereupon (a) the commitment of Lenders to make LIBOR Rate Loans shall forthwith be suspended and (b) the LIBOR Rate Loans then outstanding shall be converted automatically to Base Rate Loans on the last day of each Interest Period applicable to such LIBOR Rate Loans or within such earlier period as may be required by law. Notwithstanding the foregoing, before giving such notice, the applicable Lender shall designate  a  different lending office if such designation will void the need for giving such notice and will not, in the reasonable judgment of such Lender, be otherwise materially disadvantageous to such Lender or increase any costs payable by the Borrowers hereunder.

 

§4.8     Additional Interest.  If any LIBOR Rate Loan or any portion thereof is repaid or is converted  to a Base Rate Loan for any reason on a date which is prior to the last day of the Interest Period applicable to such LIBOR Rate Loan, or if repayment of the Loans has been accelerated as provided in §12.1, or if there is any reallocation of Commitments pursuant to §2.11, the Borrowers will pay to Agent upon demand for the account of the applicable Lenders in accordance with their respective Commitment Percentages (or to the Swing Loan Lenders with respect to a Swing Loan (pro rata based upon the ratio of each Swing  Loan Lender’s Swing Loan Commitment to the total Swing Loan Commitments of all of the Swing Loan Lenders)), in addition to any amounts of interest otherwise payable hereunder, the Breakage Costs. The Borrowers understand, agree and acknowledge the following: (i) no Lender has any obligation to purchase, sell and/or match funds in connection with the use of LIBOR as a basis for calculating the rate of interest on a LIBOR  Rate Loan; (ii) LIBOR is used merely as a reference in determining such rate; and (iii) the Borrowers have accepted LIBOR as a reasonable and fair basis for calculating such rate and any Breakage Costs. The Borrowers further agree to pay the Breakage Costs, if any, whether or not a Lender elects to purchase, sell and/or match funds.

 

§4.9  Additional  Costs,  Etc.   Notwithstanding anything herein to the contrary,  if any Change in   Law shall:

 

 

(a)

impose,  modify or  deem applicable any reserve, special deposit, compulsory   loan,

insurance charge or similar requirement against assets of, deposits with or for the account of, or  credit  extended or participated in by, any Lender (except any reserve requirement reflected in determining LIBOR)  or any Issuing Lender;

 

 

(b)

subject Agent, any Issuing Lender, or any Lender to any Tax (other than Taxes

addressed by §4.4(b)) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

 

 

(c)

impose  on any Lender  or  any Issuing  Lender  or  the  London interbank market any

other condition, cost or expense (other than Taxes) affecting this Agreement or Loans made by such Lender or any Letter of Credit or participation therein; or

 

 

(d)

impose on any Lender or Agent any other conditions or requirements with respect   to

this Agreement, the other Loan Documents, the Loans, such Lender’s Commitment, a Letter of Credit or any class of loans or commitments of which any of the Loans or such Lender’s Commitment forms a part; and the result of any of the foregoing is:

 

(i)to increase the cost to any Lender or any Issuing Lender of making, funding, issuing, renewing, extending or maintaining any of the Loans, the Letters of Credit or such Lender’s Commitment, or

(i)

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(ii)to reduce the amount of principal, interest or other amount payable to any Lender, any Issuing Lender, or Agent hereunder on account of such Lender’s Commitment or any of the Loans or the Letters of Credit, or

 

(iii)to require any Lender, any Issuing Lender, or Agent to make any payment or to forego any interest or other sum payable hereunder, the amount of which payment or foregone interest or other sum is calculated by reference to the gross amount of any sum receivable or deemed received by such Lender, such Issuing Lender, or Agent from the Borrowers hereunder,

 

then, and in each such case, the Borrowers will (and as to clauses (a) and (b) above, subject to the provisions of

§4.4), within thirty (30) days of demand made by such Lender or (as the case may be) Agent at any time and from time to time and as often as the occasion therefor may arise, pay to such Lender or Agent such additional amounts as such Lender, such Issuing Lender, or Agent shall reasonably determine in good faith to be sufficient to compensate such Lender, such Issuing Lender, or Agent for such additional cost, reduction, payment or foregone interest or other sum. For the avoidance of doubt, the provisions of this §4.9 shall not apply with respect to Taxes, which shall be governed by §4.4(b) and §4.4(c).

 

§4.10Capital Adequacy. If after the date hereof any Lender (or any Issuing Lender) determines that

(a)as a result of a Change in Law, or (b) compliance by such Lender (or Issuing Lender) or its parent bank holding company with any directive of any such entity regarding liquidity or capital adequacy, has the effect of reducing the return on such Lender’s (or Issuing Lender’s) or such holding company’s capital as a  consequence of such Lender’s commitment to make Loans or participate in Letters of Credit hereunder (or for such Issuing Lender to issue its Letters of Credit), to a level below that which such Lender (or Issuing Lender) or holding company could have achieved but for such adoption, change or compliance (taking into consideration such Lender’s (or Issuing Lender’s) or such holding company’s then existing policies with respect to capital adequacy and assuming the full utilization of such entity’s capital) by any amount deemed by such Lender (or Issuing Lender) to be material, then such Lender (or Issuing Lender) may notify the Borrowers thereof. The Borrowers agree to pay to such Lender (or Issuing Lender) the amount of such reduction in the return on capital as and when such reduction is reasonably determined, upon presentation by such Lender (or Issuing Lender) of a statement of the amount setting forth such Lender’s (or Issuing Lender’s) calculation thereof. In determining such amount, such Lender (or Issuing Lender) may use any reasonable averaging and attribution methods generally applied by such Lender (or Issuing Lender).

 

§4.11 Breakage Costs. The Borrowers shall pay all Breakage Costs required to be paid by them pursuant to this Agreement and incurred from time to time by any Lender within fifteen (15) days from receipt of written notice from Agent, or such earlier date as may be required by this Agreement.

 

§4.12 Default Interest; Late Charge. Following the occurrence and during the continuance of any Event of Default, and regardless of whether or not Agent or Lenders shall have accelerated the maturity of the Loans, all Loans shall bear interest payable on demand at a rate per annum equal to three percent (3.0%) above the interest rate that would otherwise be in effect hereunder (the “Default Rate”), until such amount shall be paid in full (after as well as before judgment). In addition, the Borrowers shall pay a late charge equal to three percent (3.0%) of any amount of interest and/or principal payable on the Loans (other than amounts due on the applicable Maturity Date or as a result of acceleration), which is not paid by the Borrowers within ten (10)  days of the date when due.

 

§4.13Certificate.   A certificate setting  forth any amounts  payable pursuant to §4.8,  §4.9,   §4.10,

§4.11 or §4.12 and a reasonably detailed explanation of such amounts which are due, submitted by any Lender or Agent to the Borrowers, shall be conclusive in the absence of manifest error. A Lender shall be entitled to reimbursement under §4.9, or §4.10 from and after notice to the Borrowers that such amounts are due given in accordance with §4.9 or §4.10 and for a period of nine (9) months prior to receipt of such notice.

 

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§4.14 Limitation on Interest. Notwithstanding anything in this Agreement or the other Loan Documents to the contrary, all agreements between or among the Borrowers, Lenders and Agent, whether now existing or hereafter arising and whether written or oral, are hereby limited so that in no contingency, whether by reason of acceleration of the maturity of any of the Obligations or otherwise, shall the interest contracted  for, charged or received by Lenders exceed the maximum amount permissible under applicable law. If, from any circumstance whatsoever, interest would otherwise be payable to Lenders in excess of the maximum  lawful amount, the interest payable to Lenders shall be reduced to the maximum amount permitted under applicable law; and if from any circumstance Lenders shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, an amount equal to any excessive interest shall be applied to the reduction of the principal balance of the Obligations and to the payment of interest or, if such excessive interest exceeds the unpaid balance of principal of the Obligations, such excess shall be refunded to the Borrowers.  All interest paid or agreed to be paid to Lenders shall, to the extent permitted by applicable  law, be amortized, prorated, allocated and spread throughout the full period until payment in full of the principal of the Obligations (including the period of any renewal or extension thereof) so that the interest thereon for such full period shall not exceed the maximum amount permitted by applicable law. This Section shall control all agreements between or among the Borrowers, Lenders and Agent.

 

§4.15 Certain Provisions Relating to Increased Costs and Non-Funding Lenders. If a Lender gives notice of the existence of the circumstances set forth in §4.7 or any Lender requests compensation for any losses or costs to be reimbursed pursuant to any one or more of the provisions of §4.4(b), §4.9 or §4.10, then, upon the request of the Borrowers, such Lender, as applicable, shall use reasonable efforts in a manner consistent with such institution’s practice in connection with loans like the Loan of such Lender to eliminate, mitigate or reduce amounts that would otherwise be payable by the Borrowers under the foregoing provisions, provided that such action would not be otherwise prejudicial to such Lender, including, without limitation, by designating another of such Lender’s offices, branches or affiliates; the Borrowers agreeing to pay all reasonably incurred costs and expenses incurred by such Lender in connection with any such action. Notwithstanding anything to the contrary contained herein, if no Default or Event of Default shall have occurred and be continuing, and if any Lender (a) has given notice of the existence of the circumstances set forth in §4.7 or has requested payment or compensation for any losses or costs to be reimbursed pursuant to   any one or more of the provisions of §4.4(b), §4.9 or §4.10 and following the request of the Borrowers has  been unable to take the steps described above to mitigate such amounts (each, an “Affected Lender”) or (b) has failed to make available to Agent its pro rata share of any Loan or participation in a Letter of Credit or Swing Loan and such failure has not been cured (a “Non-Funding Lender”), then, within ninety (90) days after such notice or request for payment or compensation or failure to fund, as applicable, the Borrowers shall have the right as to such Affected Lender or Non-Funding Lender, as applicable, to be exercised by delivery of written notice delivered to Agent and the Affected Lender or Non-Funding Lender, within ninety (90) days of receipt of such notice or failure to fund, as applicable, to elect to cause the Affected Lender or Non-Funding Lender,  as applicable, to transfer its Commitment. Agent shall promptly  notify the remaining Lenders that each of  such Lenders shall have the right, but not the obligation, to acquire a portion of the Commitment, pro rata based upon their relevant Commitment Percentages, of the Affected Lender or Non-Funding Lender, as applicable (or if any of such Lenders does not elect to purchase its pro rata share, then to such remaining Lenders in such proportion as approved by Agent). In the event that Lenders do not elect to acquire all of the Affected Lender’s or Non-Funding Lender’s Commitment, then Agent shall endeavor to obtain a new Lender to acquire such remaining Commitment. Upon any such purchase of the Commitment of the Affected Lender or Non-Funding Lender, as applicable, the Affected Lender’s or Non-Funding Lender’s interest in the Obligations and its rights hereunder and under the Loan Documents shall terminate at the date of purchase, and the Affected Lender or Non-Funding Lender, as applicable, shall promptly execute all documents reasonably requested to surrender and transfer such interest. If such Affected Lender or Non-Funding Lender does not execute and deliver such documents to Agent within a period of time deemed reasonable by Agent after the later of (i) the date on which the replacement Lender executes and delivers such documents and (ii) the date on which the Affected Lender or Non-Funding Lender receives all payments required to be paid to it by this

§4.15, then such Affected Lender or Non-Funding Lender, as applicable, shall be deemed to have executed and delivered such documents as of such date and Parent Borrower shall be entitled (but not obligated) to   execute

 

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and deliver such documents on behalf of such Affected Lender or Non-Funding Lender, as applicable. The purchase price for the Affected Lender’s or Non-Funding Lender’s Commitment shall equal any and all amounts outstanding and owed by the Borrowers to the Affected Lender or Non-Funding Lender, as  applicable, including principal, prepayment premium or fee, and all accrued and unpaid interest or fees.

 

§4.16Cash Collateral Account.

 

 

(a)

Grant of Security.   The Borrowers hereby grant to Agent, as collateral agent for   the

ratable benefit of the Revolving Credit Lenders, a security interest in, the Borrowers’ right, title and interest in and to the LC Cash Collateral Account and all (i) funds and financial assets from time to time credited thereto (including, without limitation, all Cash Equivalents), all interest, dividends, distributions, cash, instruments  and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such funds and financial assets, and all certificates and instruments, if any, from time to time representing or evidencing the LC Cash Collateral Account, (ii) and all promissory notes, certificates of deposit, deposit accounts, checks and other instruments from time to time delivered to or otherwise possessed by Agent, as collateral agent for or on behalf of the Revolving Credit Lenders, in substitution for or in addition to any or all of the then existing LC Account Collateral and (iii) all interest, dividends, distributions, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of the then existing LC Account Collateral, in each  of the  cases  set  forth  in  clauses (i), (ii) and (iii) above, whether now owned or hereafter acquired by the Borrowers, wherever located, and whether now or hereafter existing or arising (all of the foregoing, collectively, the “LC Account Collateral”).

 

 

(b)

Maintaining the LC Account Collateral.  So long as any Loan or any other Obligation

of any Loan Party under any Loan Document shall remain unpaid, any Letter of Credit shall be outstanding or any Lender shall have any Commitment:

 

(i)the Borrowers will maintain all LC Account Collateral only with Agent, as

collateral agent;

 

(ii)Agent shall have the sole right to direct the disposition of funds with respect to the LC Cash Collateral Account subject to the provisions of this Agreement, and it shall be a term and condition of such LC Cash Collateral Account that, except as otherwise provided herein, notwithstanding any term or condition to the contrary in any other agreement relating to the LC Cash Collateral Account, as the  case may be, that no amount (including, without limitation, interest on Cash Equivalents credited thereto) will be paid or released to or for the account of, or withdrawn by or for the account of, the Borrowers or any other Person from the LC Cash Collateral Account; provided, however, that if no Event of Default is in effect, such funds shall, at the Borrowers’ option, be released to pay the amounts then due to the beneficiaries of the Letters of Credit after a proper draw thereunder; and

 

(iii)Agent may (with the consent of the Required Lenders and shall at  the request of the Required Lenders), at any time and without notice to, or consent from, the Borrowers, transfer,  or direct the transfer of, funds from the LC Account Collateral to satisfy the Borrowers’ Obligations under the Loan Documents if an Event of Default shall have occurred and be continuing.

 

 

(c)

Investing of Amounts in the LC Cash Collateral Account.   Agent will, from time   to

time (i) invest (A) amounts received with respect to the LC Cash Collateral Account in such Cash Equivalents credited to the LC Cash Collateral Account as the Borrowers may select and Agent, as collateral agent, may approve in its reasonable discretion, and (B) interest paid on the Cash Equivalents referred to in clause (i)(A) above, and (ii) reinvest other proceeds of any such Cash Equivalents that may mature or be sold, in each case  in such Cash Equivalents credited in the same manner. Interest and proceeds that are  not  invested  or reinvested in Cash Equivalents as provided above shall be deposited and held in the LC Cash Collateral Account.       In addition, Agent shall have the right at any time to exchange such Cash Equivalents for similar

 

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Cash Equivalents of smaller or larger determinations, or for other Cash Equivalents, credited to the LC Cash Collateral Account.

 

 

(d)

Release of Amounts.       So long as no Event  of Default shall have  occurred and be

continuing or would result therefrom and except with respect to the amounts required to be deposited in the LC Cash Collateral Account pursuant to §4.16(a) above, if any, Agent will pay and release to the Borrowers or at their order or, at the request of the Borrowers, to Agent to be applied to the Obligations of the Borrowers under the Loan Documents such amount, if any, as is then on deposit in the LC Cash Collateral Account.

 

 

(e)

Remedies.  Upon the occurrence and during the continuance of any Event of Default,

in addition to the rights and remedies available pursuant to §12 hereof and under the other Loan Documents, (i) Agent may exercise in respect of the LC Account Collateral all the rights and remedies of a secured party upon default under the Uniform Commercial Code (whether or not the Uniform Commercial Code applies to the affected LC Account Collateral), and (ii) Agent may, without notice to the Borrowers (except as required by law) and at any time or from time to time, charge, set-off and otherwise apply all or any part of the Obligations of the Borrowers under the Loan Documents against any funds held with respect to the LC Account Collateral or in any other deposit account.

 

§5         UNENCUMBERED ASSETS.

 

§5.1Initial Unencumbered Assets.  The initial Unencumbered Assets are listed on Schedule 5.1.

 

§5.2 Addition of Unencumbered Assets. If Parent Borrower elects, in its sole discretion, to add an additional Multifamily Property as an Unencumbered Asset, Parent Borrower shall deliver (A) a certificate signed on behalf of Parent Borrower by an Authorized Officer to Agent, designating such additional Multifamily Property as an Unencumbered Asset and dated as of the date of such designation, stating that (1) on a Pro Forma Basis after giving effect to such designation, the Loan Parties shall be in compliance with the covenants contained in §9, together with supporting information in form reasonably satisfactory to Agent showing the computations used in determining compliance with such covenants, (2) such Multifamily Property meets all Unencumbered Asset Conditions (except as may have otherwise been waived in writing by the Required Lenders), (3) after giving effect to the inclusion of such Multifamily Property as an Unencumbered Asset, each of the representations and warranties made by or on behalf of the Borrowers or any of their respective Subsidiaries contained in this Agreement, the other Loan Documents or in any document or instrument delivered pursuant to or in connection with this Agreement shall be true and correct in all material respects as of the time of the addition of such Unencumbered Asset (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct only as of such specified date) and (4) after giving effect to the inclusion of such Multifamily Property as an Unencumbered Asset, no Default or Event of Default shall have occurred and be continuing and (B) an updated Schedule 5.1 listing each Unencumbered Asset as of the date such Multifamily Property is added as an Unencumbered Asset hereunder; provided, however, that no Multifamily Property shall be included as an Unencumbered Asset unless such Multifamily Property satisfies all Unencumbered Asset Conditions or the Required Lenders have consented in writing to such inclusion.

 

§5.3   Failure of Unencumbered Asset  Conditions.   Notwithstanding anything contained herein to   the contrary, to the extent any Multifamily Property previously qualifying as an Unencumbered Asset ceases to meet any of the Unencumbered Asset Conditions (except as may have otherwise been waived in writing by the Required Lenders), such Multifamily Property shall be immediately removed from the calculations contained herein relating to the Unencumbered Asset Financial Covenants and such Multifamily Property shall immediately cease to be an “Unencumbered Asset” hereunder and Parent Borrower shall deliver (A) a certificate signed on behalf of Parent Borrower by an Authorized Officer to Agent designating such Multifamily Property as a non-Unencumbered Asset and dated as of the date of such designation, stating that

(1)on a Pro Forma Basis after giving effect to such removal, the Loan Parties shall be in compliance with the covenants  contained  in  §9,  together  with supporting  information  in  form reasonably satisfactory to Agent

(1)

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showing the computations used in determining compliance with such covenants, (2) after giving effect to such removal, each of the representations and warranties made by or on behalf of the Borrowers or any of their respective Subsidiaries contained in this Agreement, the other Loan Documents or in any document or instrument delivered pursuant to or in connection with this Agreement shall be true and correct in all material respects as of the time of such removal (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct only as of such specified date) and (3) after giving effect to such removal, no Default or Event of Default shall have occurred and be continuing and (B) an updated Schedule 5.1 listing each Unencumbered Asset as of the date such Unencumbered Asset has been removed as an Unencumbered Asset hereunder.

 

§5.4 Borrower Election to Remove Unencumbered Assets. Parent Borrower  may  voluntarily designate any Unencumbered Asset as a non-Unencumbered Asset, by delivering to Agent a certificate signed on behalf of Parent Borrower by an Authorized Officer designating such Unencumbered Asset as a non- Unencumbered Asset (such designation to be effective upon receipt by Agent of such certificate), (i) stating that (1) on a Pro Forma Basis after giving effect to such removal, the Loan Parties shall be in compliance with the covenants contained in §9, together with supporting information in form reasonably satisfactory to Agent showing the computations used in determining compliance with such covenants, (2) after giving effect to the removal of such Unencumbered Asset, each of the representations and warranties made by or on behalf of the Borrowers or any of their respective Subsidiaries contained in this Agreement, the other Loan Documents or in any document or instrument delivered pursuant to or in connection with this  Agreement shall be true and correct in all material respects as of the time of the removal of such Unencumbered Asset (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct only as of such specified date) and (3) after giving effect to the removal of such Unencumbered Asset, no Default or Event of Default shall have occurred and be continuing and (ii) an updated Schedule 5.1 listing each Unencumbered Asset as of the date such Unencumbered Asset has been removed as an Unencumbered Asset hereunder; provided, however, that without the consent of the Required Lenders, Parent Borrower may not designate any Unencumbered Asset as a non-Unencumbered Asset if following such designation the Loan Parties would not be in compliance with §9.8.

 

§5.5 Release of Subsidiary Borrowers. In the event that all Unencumbered Assets owned by a Subsidiary Borrower shall have been removed as Unencumbered Assets in accordance with the terms of this Agreement, then, upon the request of Parent Borrower, such Subsidiary Borrower shall be released by Agent from liability under this Agreement pursuant to a Subsidiary Borrower Release substantially in the form of Exhibit J hereto.

 

§5.6 Additional Subsidiary Borrowers. As a condition precedent to the addition of a Multifamily Property as an Unencumbered Asset hereunder, (x) concurrently with the delivery of a certificate adding an Unencumbered Asset pursuant to §5.2 above directly owned or leased by a Subsidiary of Parent Borrower that is not already a Borrower, or, (y) within ten days after the formation or acquisition of any new direct  or indirect Subsidiary of Parent Borrower that is intended to directly own or lease an Unencumbered Asset,  Parent Borrower shall cause each such Subsidiary to (A) duly execute and deliver to Agent a Joinder Agreement, and such Subsidiary shall become a Subsidiary Borrower hereunder, (B) provide all “know your customer” and other materials reasonably requested by Agent or any Lender to ensure that each such Person is in compliance with §6.1(e), (C) deliver to Agent such organizational agreements, resolutions, consents, opinions and other documents and instruments as Agent may reasonably require and (D) deliver to Agent supplements to the Schedules to this Agreement (or the factual information needed to update such Schedules) solely to the extent necessary due to any changes in factual matters specifically related to the addition of such Subsidiary or Subsidiaries as a Subsidiary Borrower or the addition of such Unencumbered Asset (so long as such changes in factual matters shall in no event comprise a Default or an Event of Default).

 

§5.7 Costs and Expenses of Additions and Removals. The Borrowers shall pay all reasonable and documented costs and expenses of Agent in connection with the addition or removal of an Unencumbered

 

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Asset pursuant to §5.2 through §5.6, including without limitation, reasonable and documented attorney’s fees of one legal counsel to Agent.

 

§6REPRESENTATIONS AND WARRANTIES.

 

The Borrowers represent and warrant to Agent and Lenders as follows, each as of the Closing Date hereof, and as of the date of the funding of any Loan hereunder:

 

§6.1Corporate Authority, Etc.

 

 

(a)

Incorporation; Good Standing.   Parent Borrower  is a  Delaware limited partnership

duly organized pursuant to its certificate of limited partnership filed with the Delaware Secretary of State, and is validly existing and in good standing under the laws of the State of Delaware. Parent Guarantor is a Maryland corporation duly incorporated pursuant to its articles of incorporation filed with the Maryland Secretary of State, and is validly existing and in good standing under the laws of the State of Maryland. Each  of Parent Borrower and each Guarantor (i) has all requisite power to own its property and conduct its business as now conducted and as presently contemplated, except where the failure to be so qualified would not be reasonably likely to have a Material Adverse Effect and (ii) is in good standing in its jurisdiction of organization or formation and in each other jurisdiction where a failure to be so qualified in such other  jurisdiction would be reasonably likely to have a Material Adverse Effect.

 

 

(b)

Subsidiaries.Each  of  the  Subsidiary  Borrowers  (i)  is  a  corporation,     limited

partnership, general partnership, limited liability company or trust duly organized under the laws of its State of organization and is validly existing and in good standing under the laws thereof, (ii) has all requisite power to own its property and conduct its business as now conducted and as presently contemplated except where the failure to be so qualified would not be reasonably likely to have a Material Adverse Effect and (iii) is in good standing and is duly authorized to do business in its jurisdiction of organization or formation and in each jurisdiction where an Unencumbered Asset owned or leased by it is located to the extent required to do so under applicable law and in each other jurisdiction where a failure to be  so qualified would be reasonably likely to have a Material Adverse Effect.

 

 

(c)

Authorization.   The execution, delivery and performance of this Agreement and the

other Loan Documents to which any of the Loan Parties is a party and the transactions contemplated hereby  and thereby (i) are within the corporate or other organizational authority of the Loan Parties, (ii) have been  duly authorized by all necessary actions on the part of the Loan Parties, (iii) do not and will not conflict with or result in any breach or contravention of any provision of law, statute, rule or regulation to which any Loan  Party is subject or any judgment, order, writ, injunction, license or permit applicable to any Loan Party, in each case except as would not be reasonably likely to have a Material Adverse Effect, (iv) do not and will not conflict with or constitute a default (whether with the passage of time or the giving of notice, or both) under  any provision of the partnership agreement, limited liability company agreement, articles of incorporation or other charter documents or bylaws of any Loan Party, (v) do not and will not result in or require the imposition of any lien or other encumbrance on any of the properties, assets or rights of any Loan Party other than Permitted Liens, and (vi) do not require the approval or consent of any Governmental Authority to be obtained by any Loan Party or any Affiliate thereof other than those already obtained and delivered to Agent or except  as would not reasonably be likely to have a Material Adverse Effect.

 

 

(d)

Enforceability.   The execution and delivery of this  Agreement and the   other  Loan

Documents to which any of the Loan Parties is a party are valid and legally binding obligations of the Loan Parties enforceable in accordance with the respective terms and provisions hereof and thereof, except as enforceability is limited by bankruptcy, insolvency, reorganization, moratorium or other laws relating to or affecting generally the enforcement of creditors’ rights and general principles of equity.

 

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(e)

Foreign  Assets  Control.   To the  knowledge  of each Loan Party,  none  of the Loan

Parties or any Subsidiaries of the Loan Parties: (i) is a Sanctioned Person, (ii) has any of its assets in Sanctioned Entities, or (iii) derives any of its operating income from investments in, or transactions with, Sanctioned Persons or Sanctioned Entities. To the knowledge of each Loan Party, each Loan Party and its respective officers, employees, directors and agents, are in compliance, in all material respects, with Anti- Corruption Laws and applicable Sanctions. No use of the proceeds of any Loan or Letter of Credit will violate Anti-Corruption Laws or applicable Sanctions. Neither the making of the Loans 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.  Each Loan Party   and its Subsidiaries are in compliance, in all material respects, with the Patriot Act.

 

§6.2   Governmental Approvals.   The execution,  delivery and perfo