-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GmhvgLwNFizX5XE/uhqn8f5ISi/FBq53WhjUluvtR4Ox1zxNMLZuHiYPaLqS4W0T pwLa9AFny8Il1xz3Iqak+g== 0000950133-00-001036.txt : 20000323 0000950133-00-001036.hdr.sgml : 20000323 ACCESSION NUMBER: 0000950133-00-001036 CONFORMED SUBMISSION TYPE: 10-K PUBLIC DOCUMENT COUNT: 17 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000322 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEW PLAN EXCEL REALTY TRUST INC CENTRAL INDEX KEY: 0000798288 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 330160389 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K SEC ACT: SEC FILE NUMBER: 001-12244 FILM NUMBER: 575065 BUSINESS ADDRESS: STREET 1: 1120 AVENUE OF THE AMERICAS 12TH FL CITY: NEW YORK STATE: NY ZIP: 10036 BUSINESS PHONE: 2128693000 MAIL ADDRESS: STREET 1: 1120 AVENUE OF THE AMERICAS STREET 2: 12TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10036 FORMER COMPANY: FORMER CONFORMED NAME: EXCEL REALTY TRUST INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: EXCEL REALTY ADVISORS INC DATE OF NAME CHANGE: 19900514 FORMER COMPANY: FORMER CONFORMED NAME: INVESTORS REALTY TRUST INC DATE OF NAME CHANGE: 19890612 10-K 1 NEW PLAN REALTY TRUST FORM 10-K 1 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 ------------------------ FORM 10-K [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED EFFECTIVE OCTOBER 7, 1996] FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER 1-12244 NEW PLAN EXCEL REALTY TRUST, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) MARYLAND 33-0160389 (STATE OF INCORPORATION) (I.R.S. EMPLOYER IDENTIFICATION NO.) 1120 AVENUE OF THE AMERICAS (212) 869-3000 NEW YORK, NY 10036 (REGISTRANT'S TELEPHONE NUMBER) (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
Securities registered pursuant to Section 12(b) of the Act: Common Stock, $0.01 par value per share New York Stock Exchange Series A Cumulative Convertible Preferred New York Stock Exchange Stock Series B Cumulative Redeemable Preferred New York Stock Exchange Stock
Securities registered pursuant to Section 12(g) of the Act: NONE Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] The aggregate market value of the Registrant's shares of common stock held by non-affiliates was approximately $1,130,968,000 as of March 10, 2000, based on the closing price of $13.375 on the NYSE on that date. As of March 10, 2000, the number of shares of common stock of the Registrant outstanding was 87,650,655. Documents incorporated by reference: Portions of the Proxy Statement for the 2000 Annual Meeting of Stockholders of the Registrant to be filed subsequently with the SEC are incorporated by reference into Part III of this report. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 TABLE OF CONTENTS
PAGE ---- PART I Item 1. Business.................................................... 1 Item 2. Properties.................................................. 12 Item 3. Legal Proceedings........................................... 13 Item 4. Submission of Matters to a Vote of Security Holders......... 13 PART II Item 5. Market for Registrant's Common Equity and Related Stockholder Matters......................................... 13 Item 6. Selected Financial Data..................................... 14 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations................................... 15 Item 7A. Quantitative and Qualitative Disclosures About Market Risk........................................................ 22 Item 8. Financial Statements and Supplementary Data................. 22 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.................................... 22 PART III Item 10. Directors and Executive Officers of the Registrant.......... 23 Item 11. Executive Compensation...................................... 23 Item 12. Security Ownership of Certain Beneficial Owners and Management.................................................. 23 Item 13. Certain Relationships and Related Transactions.............. 23 PART IV Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K......................................................... 23
3 PART I FORWARD-LOOKING STATEMENTS This Annual Report on Form 10-K, together with other statements and information publicly disseminated by New Plan Excel Realty Trust, Inc. (the "Registrant" or the "Company"), contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are based on assumptions and expectations which may not be realized and are inherently subject to risks, uncertainties and other factors, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, performance or achievements, financial and otherwise, may differ materially from the results, performance or achievements expressed or implied by the forward-looking statements. Risks, uncertainties and other factors that might cause such differences, some of which could be material, include, but are not limited to: national and local economic, business and real estate and other market conditions; financing risks, such as the inability to obtain debt or equity financing on favorable terms; the level and volatility of interest rates; financial stability of tenants; the impact of dramatic increases in electronic commerce; the rate of revenue increases versus expense increases; governmental approvals, actions and initiatives; environmental/safety requirements; risks of real estate acquisition and development (including the failure of acquisitions to close and pending developments to be completed on time and within budget); as well as other risks identified from time to time in this Annual Report on Form 10-K and in the other reports filed by the Company with the SEC or otherwise publicly disseminated by the Company. ITEM 1. BUSINESS GENERAL The Company, a self-administered and self-managed equity real estate investment trust ("REIT"), is a Maryland corporation and one of the nation's largest community and neighborhood shopping center companies. As of December 31, 1999, the Company owned interests in 303 retail properties (including one retail property under redevelopment, five office properties and two vacant land parcels) containing over 37 million square feet of gross leasable area in 31 states. The Company also owned, as of that date, 53 apartment communities (including three apartment communities under redevelopment) containing approximately 12,600 units in 14 states. The Company elected to be taxed as a REIT for federal income tax purposes, beginning with its taxable year ended December 31, 1987, and believes that, beginning with that taxable year, it has been organized and has operated in conformity with the requirements for qualification as a REIT under the Internal Revenue Code of 1986. Although the Company believes that it will continue to operate in such a manner, no assurance can be given that the Company will continue to qualify as a REIT. In order to maintain its qualification as a REIT, among other things, the Company must distribute to its stockholders each year at least 95% of its REIT taxable income and meet certain tests regarding the nature of its income and assets. As a REIT, the Company is not subject to federal income tax with respect to that portion of its income which meets certain criteria and is distributed annually to the stockholders. Additionally, to facilitate maintenance of the Company's REIT qualification and for other strategic reasons, the Company's charter generally prohibits any person from acquiring or holding shares of the Company's preferred and common stock in excess of 9.8% (by value or by number of shares, whichever is more restrictive) of the outstanding shares of each class or series of stock of the Company, subject to certain exceptions. DESCRIPTION OF BUSINESS As of December 31, 1999, the Company owned interests in 303 retail properties (including one retail property under redevelopment, five office properties and two vacant land parcels) containing over 37 million square feet of gross leasable area in 31 states. The Company also owned, as of that date, 53 apartment communities (including three apartment communities under redevelopment) containing approximately 12,600 units in 14 states. The average occupancy rates as of December 31, 1999 for the retail properties (including five office properties and excluding one retail property under redevelopment) and the apartment 1 4 communities (excluding the three apartment communities under redevelopment) were 92.3% and 90.8%, respectively. The Company maintains its principal executive offices at 1120 Avenue of the Americas, New York, New York 10036, where its telephone number is (212) 869-3000. Strategy and Philosophy The following is a brief discussion of the Company's current strategies and policies concerning management, acquisitions, dispositions, investments, finances and operations. The Company may however, from time to time, alter or change one or more of these strategies or its policies in these areas. The Company's primary objective is to acquire, own and manage a portfolio of commercial retail properties and apartment communities that will provide increasing cash flow for quarterly distributions to stockholders while protecting investor capital and providing potential for capital appreciation. The Company seeks to achieve this objective by (i) aggressively managing and, where appropriate, redeveloping its existing operating properties, (ii) continuing to acquire well-located neighborhood and community shopping centers and other retail properties with tenants that have a national or regional presence and an established credit quality, and well-located income-producing apartment communities at a discount to replacement cost and (iii) continuing to maintain a strong and flexible financial position to facilitate growth. Aggressive Management The Company aggressively manages its retail properties, with an emphasis on maintaining high occupancy rates and a strong base of nationally recognized anchor tenants. The Company regularly monitors the physical condition of its retail properties and the financial condition of its retail tenants. The Company follows a schedule of regular physical maintenance at its retail properties with a view toward tenant expansions, renovations and refurbishing to preserve and increase the value of these properties. The Company currently is upgrading existing facades, updating signage, resurfacing parking lots and improving parking lot and exterior building lighting at certain of its retail properties. In addition, the Company believes that average rents from its apartment portfolio are below market and can be increased with a focus on renovation and refurbishment. These renovations and refurbishments include interior improvements such as carpet, counter tops, vanities, appliances and lighting. Exterior improvements include driveways, landscaping, lighting, new signage, roofs, windows and other exterior building improvements. The Company's objectives regarding selection of those properties to be renovated or refurbished is based upon a review of a number of variables. These variables include strength of the market in which the property is located, current occupancy at the property compared to occupancy within the local market, current rentals, anticipated return on additional investments, and maintenance or improvement of market share. The Company may contract for renovation and refurbishment work with third parties and will manage the construction progress in an attempt to minimize the disturbance to ongoing property operations. The Company believes that these improvements will preserve and increase the value of these properties over time. The Company has field offices throughout the country, each of which is responsible for managing the leasing, property management and maintenance of the Company's properties in its region. The Company also has an office in Salt Lake City, Utah whose efforts are dedicated solely to renovations, acquisitions and dispositions of the Company's properties, as well as joint venture developments and redevelopments of the Company's properties. The Company seeks to increase the cash flow and portfolio value of its existing properties primarily through contractual rent increases during the lease term, reletting of existing space at higher rents, expansion of existing properties and the minimization of overhead and operating costs. Acquisition of Properties General. The Company intends to continue its portfolio focus on retail properties and apartment communities that generate stable cash flows and present the opportunity for appreciation. The Company seeks to expand its portfolio by acquiring (i) well-located neighborhood and community shopping centers and other 2 5 retail properties with tenants that have a national or regional presence and an established credit quality, and that the Company believes will have the ability to make timely lease payments over the term of the lease, and (ii) well-located income-producing apartment communities at a discount to replacement cost. When acquiring properties, the Company focuses on the quality of the location and comparable market rents. Additionally, the Company intends to continue to evaluate its mix of property types and may purchase from time to time other property types that the Company believes will meet its objectives. Acquisitions through Partnerships. The Company may from time to time enter into joint venture partnership arrangements with third parties for the acquisition and management of properties. The Company also may acquire properties from unaffiliated property owners in exchange for units of limited partnership interest in a partnership that the Company controls. These partnership units generally are redeemable for cash or, in the sole discretion of the general partner of the partnership, for shares of the Company's common stock. The Company believes that this acquisition method may permit the Company to acquire properties at attractive prices from property owners wishing to enter into tax-deferred transactions. The Company formed Excel Realty Partners, L.P., a Delaware limited partnership in which a wholly owned subsidiary of the Company is the sole general partner ("ERP"), to facilitate these transactions. Development through Joint Venture Financing. The Company may from time to time finance properties under development, generally where the developer previously has (i) obtained all entitlements required to complete the development and (ii) identified principal tenant(s) that will occupy the property. Under this financing method, the Company typically makes a subordinated loan to the developer. Upon completion of the project, the Company may have the option to purchase the property. The Company believes that this method of financing gives the Company opportunities to purchase developed properties and property portfolios at capitalization rates slightly higher than those which might otherwise be available after completion of development. Certain of these transactions have been and will be completed through the Company's development affiliate, ERT Development Corporation, a Delaware corporation ("ERT"). Acquisitions of Real Estate Companies/Portfolios. The Company may acquire various public and private real estate companies and real estate portfolios in an effort to position itself as an industry consolidator. The Company's strategy is to capitalize on the benefits of size, market capitalization, liquidity and financial strength that can be gained from consolidation. Disposition of Properties The Company continually analyzes each asset in its portfolio and identifies those properties which can be sold or exchanged (to the extent consistent with REIT qualification requirements) for optimal sales prices or exchange values, given prevailing market conditions and the particular characteristics of each property. Through this strategy, the Company seeks to continually update its core property portfolio by disposing of properties which have limited growth potential and redeploying capital into newer properties or properties where the Company's aggressive management techniques may maximize property values. The Company may engage from time to time in like-kind property exchanges which allow the Company to dispose of properties and redeploy proceeds in a tax efficient manner. The Company holds its properties for investment and the production of rental income and not for sale to customers or other buyers in the ordinary course of the Company's business. If the Company were treated as holding properties for sale to customers in the ordinary course of its business, tax rules applicable to REITs would subject the Company to tax equal to 100% of its gain from each property sold. Financing Strategy The Company intends to finance future acquisitions with the most advantageous sources of capital available to the Company at the time, which may include the sale of common stock, preferred stock or debt securities through public offerings or private placements, the incurrence of additional indebtedness through secured or unsecured borrowings, and the reinvestment of proceeds from the disposition of assets. The Company also may enter into joint ventures with institutions to acquire large properties. In these instances, the Company generally receives property management and leasing fees in addition to a disproportionate share of 3 6 the profits after a preferred return is received by the institutional partner. The Company's financing strategy is to maintain a strong and flexible financial position by (i) maintaining a prudent level of leverage, (ii) maintaining a large pool of unencumbered properties, (iii) managing its exposure to interest rate risk represented by its floating rate debt and (iv) where possible, amortizing existing non-recourse mortgage debt secured by specific properties over the term of the leases with anchor tenants at such mortgaged properties. Environmental Conditions Under various federal, state and local laws, ordinances and regulations, the Company may be considered an owner or operator of real property or may have arranged for the disposal or treatment of hazardous or toxic substances and, therefore, may become liable for the costs of removal or remediation of certain hazardous substances released on or in its property or disposed of by it, as well as certain other potential costs which could relate to hazardous or toxic substances (including governmental fines and injuries to persons and property). Such liability may be imposed whether or not the Company knew of, or was responsible for, the presence of such hazardous or toxic substances. Except as discussed below, the Company is not aware of any significant environmental condition at any of its properties. Soil and groundwater contamination exists at certain of the Company's properties. The primary contaminants of concern at these properties include perchloroethylene and trichloroethyleme (associated with the operations of on-site dry cleaners), petroleum hydrocarbons (associated with the operations of on-site auto repair facilities) and methyl tertiary butyl ether (from unknown sources). The Company currently estimates that the total cost of remediation of environmental conditions at these properties will be in the range of approximately $2.8 million to $6.5 million, although there can be no assurance that this range of estimates will prove accurate. In connection with certain of these properties, the Company has entered into remediation and indemnity agreements, which obligate the prior owners of the properties (including, in some cases, principals of the prior owners) to perform the remediation and to indemnify the Company for any losses the Company may suffer because of the contamination or remediation. There can be no assurance, however, that the prior owners will perform their obligations under these agreements, although in certain cases prior owners have set aside funds in escrow with respect to their performance under these agreements. In connection with certain other properties, the former tenants at the properties are in the process of performing the necessary remediation, although there can be no assurance that such remediation will be satisfactory. In connection with certain additional properties, the Company has assumed the obligation to perform the necessary remediation in connection with the Company's purchase of the properties. In addition to the environmental conditions discussed above, asbestos minerals (associated with spray-applied fireproofing materials) exist at certain of the Company's properties. The Company currently estimates that the total cost of remediation of asbestos minerals at these properties will be approximately $3 million, although there can be no assurance that this estimate will prove accurate. The Company does not expect the environmental conditions at its properties, considered as a whole, to have a material adverse effect on the Company. The Company seeks to protect itself from environmental liabilities associated with properties it acquires in a number of ways. As part of its internal due diligence process, the Company undertakes environmental site assessments prior to purchasing a property. The Company generally will not purchase a property if these assessments reveal potential environmental liabilities. The Company may, however, evaluate the risks and attempt to quantify the potential costs associated with such liabilities, and then make a determination of whether to acquire the property. If the Company chooses to acquire the property, it will typically require the prospective seller/tenant to agree to remediate any environmental problems and it may obtain a letter of credit or other security to provide adequate assurance to the Company that sufficient funds will be available to complete the work. Alternatively, the Company may negotiate a purchase price reduction that considers the estimated cost of remediation. The Company will continue to obtain environmental reports on all properties it seeks to acquire. Moreover, to protect itself against environmental liabilities that were not discovered during its pre-purchase investigations as well as those that were disclosed, the Company, in the purchase agreement and/or lease, will typically require the seller/tenant to indemnify the Company against any and all environmental liabilities arising from the property acquired. 4 7 No assurance can be given that any environmental studies performed at the Company's properties will identify all material environmental conditions, that any prior owner of the properties did not create a material environmental condition not known to the Company or that a material environmental condition does not otherwise exist with respect to any of the Company's properties. RECENT DEVELOPMENTS Medium-Term Notes Program On February 3, 1999, the Company established a program for the sale of up to $500 million aggregate principal amount of medium-term notes due nine months or more from date of issue. On July 15, 1999, the Company issued $175 million aggregate principal amount of notes under its medium-term notes program in two series. The Company issued $150 million with a 10-year maturity and a coupon of 7.4% and $25 million of another series with a 30-year maturity and a coupon of 7.5%. On September 10, 1999, following the internal merger transaction described below, the Company re-established its medium-term notes program in the aggregate principal amount of $325 million. On November 12, 1999, the Company issued $49 million aggregate principal amount of notes under its medium-term notes program with a four-year maturity and a coupon of 7.33%. Internal Merger Transaction On August 5, 1999, the Company consummated an internal merger transaction pursuant to which substantially all of the assets and liabilities of New Plan Realty Trust, a wholly owned subsidiary of the Company, were merged into the Company and thereby became direct assets and liabilities of the Company. In connection with this transaction, all of the Trust's outstanding publicly issued debt (i.e., debt issued under New Plan Realty Trust's Indenture dated as of March 29, 1995) was assumed by the Company. In addition, as a result of the merger transaction, the existing guarantees by New Plan Realty Trust of certain of the Company's outstanding publicly issued debt (i.e., debt issued under the Company's Indenture dated as of February 3, 1999) were terminated in accordance with the terms of the Indenture. New Chief Executive Officer and President On February 23, 2000, Glenn J. Rufrano was appointed Chief Executive Officer and President of the Company. Mr. Rufrano also has been appointed to the Company's Investment Committee, and will be nominated to serve on the Company's Board of Directors. Mr. Rufrano succeeds Arnold Laubich, who has retired as both CEO and President. Term Loan Agreement with Fleet National Bank On March 7, 2000, the Company established a term loan facility with Fleet National Bank, pursuant to which the Company may draw down up to $75 million through April 27, 2000. Loans drawn under this facility will mature on March 5, 2001 and accrue interest at LIBOR plus 80 basis points (based on the Company's current credit rating). The term loan agreement prepared in connection with the facility contains covenants substantially similar to those included in the Company's two revolving credit facilities with The Bank of New York. COMPETITION The success of the Company depends upon, among other factors, the trends of the economy, including interest rates, income tax laws, increases or decreases in operating expenses, governmental regulations and legislation, including environmental requirements, real estate fluctuations, retailing trends, population trends, zoning laws, the financial condition and stability of tenants, the impact of dramatic increases in electronic commerce, the availability of financing and capital on satisfactory terms, the ability of the Company to compete with others for tenants and keep its properties leased at profitable levels and construction costs. The Company competes for acquisitions of, and investments in, properties and real estate companies with an indeterminate number of investors, including investors with access to significant capital such as domestic and 5 8 foreign corporations and financial institutions, publicly traded and privately held REITs, private institutional investment funds, investment banking firms, life insurance companies and pension funds. Adverse changes in general or local economic conditions could result in the inability of some existing tenants of the Company to meet their lease obligations and could otherwise adversely affect the Company's ability to attract or retain tenants. Management believes, however, that the Company's financial strength and operating practices, particularly its ability to implement renovation, expansion and leasing programs, will enable it to maintain and increase rental income from its properties. EMPLOYEES As of December 31, 1999, the Company employed approximately 750 individuals (including executive, administrative and field personnel). FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS The Company is in the business of managing, operating, leasing, acquiring, developing, redeveloping and investing in retail properties (including five office properties and two vacant land parcels) and apartment communities. See the Consolidated Financial Statements and Notes thereto included in Item 8 of this Annual Report on Form 10-K for certain information required by Item 1. See "-- Description of Business -- Strategy and Philosophy" above. RISK FACTORS Set forth below are the risks that the Company believes are material to investors who purchase or own the securities of the Company that are not otherwise described in this Annual Report on Form 10-K. The Company is Dependent on Key Personnel The Company depends upon the efforts of its executive officers. The loss of the services of one or more of the Company's executive officers or of certain other key personnel could have a material adverse effect on the Company. The Company has not obtained "key man" insurance with respect to any members of its executive management team, however, and does not expect that it will purchase such insurance in the foreseeable future. Performance and Share Value are Subject to Risks Associated with the Real Estate Industry The Company Faces the Risks of All Real Estate Companies. If the Company's assets do not generate income sufficient to pay expenses and maintain properties, it may not be able to service debt or pay expected dividends to stockholders. A number of factors may adversely affect the economic performance of the Company and the value of its properties. These factors include changes in the national, regional and local economic climate, local conditions, such as an oversupply of space in properties like those owned by the Company, or a reduction in demand for such properties, the attractiveness of its properties to tenants, competition from other available properties, the impact of dramatic increases in electronic commerce, changes in market rental rates and the need to periodically repair, renovate and relet space. The Company's performance also depends on its ability to collect rent from tenants and to pay for adequate maintenance, insurance and other operating costs (including real estate taxes), which could increase over time. Also, the expenses of owning and operating a property are not necessarily reduced when circumstances such as market factors and competition cause a reduction in income from the property. If a property is mortgaged and the Company is unable to make the mortgage payments, the lender could foreclose on the mortgage and take the property. In addition, interest rate levels, the availability of financing and changes in laws and governmental regulations (including those governing usage, zoning, the environment and taxes) may adversely affect the Company's financial condition. The Company is Dependent upon Economic Trends in the Retailing Industry. The Company's properties consist largely of community and neighborhood shopping centers and other retail properties. The Company's performance therefore is linked to economic conditions in the market for retail space generally. 6 9 The market for retail space has been or could be adversely affected by the ongoing consolidation in the retail sector, the adverse financial condition of certain large retailing companies, the excess amount of retail space in certain markets, and increasing consumer purchases through catalogues or the Internet. To the extent that these conditions impact the market rents for retail space, the Company's financial position and ability to service debt and pay dividends to stockholders could be adversely affected. Increasing Consumer Purchases through the Internet could Reduce Demand for the Company's Retail Space. Consumer purchases through the Internet have increased dramatically in the last few years, and rapid growth in electronic commerce likely will continue in the foreseeable future. Electronic commerce could adversely impact market rents for retail space and, therefore, the Company's financial position and ability to service debt and pay dividends to stockholders. The Company May be Unable to Renew Leases or Relet Space as Leases Expire. If the Company's tenants decide not to renew their leases upon expiration, the Company may not be able to relet the space. Even if the tenants do renew or the Company can relet the space, the terms of renewal or reletting (including the cost of required renovations) may be less favorable than current lease terms or than expectations for the space. As of December 31, 1999, leases were scheduled to expire on a total of approximately 39% of the space at the Company's retail properties through the end of 2003. If the Company is unable promptly to renew the leases or relet this space, or if the rental rates upon renewal or reletting are significantly lower than expected rates, then the results of operations and financial condition may be adversely affected. Consequently, cash flow and ability to service debt and pay dividends to stockholders could be adversely affected. The Company is Dependent upon the Financial Health of its Tenants. The Company's financial position and ability to pay dividends may be affected by financial difficulties experienced by a major tenant, including a bankruptcy, insolvency or general downturn in business. The bankruptcy or insolvency of one or more major tenants or a number of smaller tenants may have an adverse impact on the Company's properties and on the income produced by such properties. As of December 31, 1999, the Company's largest retail tenants were Kmart and Wal-mart, whose scheduled annualized base rents represented 5.3% and 3.8%, respectively, of the Company's total annualized base rents. New Projects May Fail to Perform as Expected. The Company intends to continue selectively acquiring and developing community and neighborhood shopping centers, other retail and commercial properties and apartment communities. Newly acquired and newly developed properties may fail to perform as expected. The Company's management may underestimate the costs necessary to bring an acquired property up to standards established for its intended market position. New developments are subject to a number of risks, including construction delays, cost overruns, financing risks, failure to meet expected occupancy and rent levels, delays in and the inability to obtain zoning, occupancy and other governmental permits, and changes in zoning and land use laws. These development risks may result in increased project costs and the incurrence of costs for developments that are not pursued to completion. Competition for Acquisitions May Result in Increased Prices for Properties. The Company competes for acquisitions of, and investments in, properties and real estate companies with an indeterminate number of investors, including investors with access to significant capital such as domestic and foreign corporations and financial institutions, publicly traded and privately held REITs, private institutional investment funds, investment banking firms, life insurance companies and pension funds. This competition has increased prices for the types of properties in which the Company invests. Because Real Estate Property Investments are Illiquid, the Company May Not be Able to Dispose of Properties when Appropriate. Real estate property investments generally cannot be disposed of quickly. In addition, the federal tax code imposes restrictions on a REIT's ability to dispose of properties. The Company may not be able to vary its portfolio promptly in response to economic or other conditions. This inability to respond promptly to changes in economic or other conditions could adversely affect the Company's financial condition and ability to service debt and pay dividends to stockholders. Some Potential Losses are Not Covered by Insurance. The Company carries comprehensive liability, fire, extended coverage and rental loss insurance on all of its properties. The Company believes the policy 7 10 specifications and insured limits of these policies are adequate and appropriate. There are, however, certain types of losses, such as lease and other contract claims, that generally are not insured. Should an uninsured loss or a loss in excess of insured limits occur, the Company could lose all or a portion of the capital it has invested in a property, as well as the anticipated future revenue from the property. In such an event, the Company might nevertheless remain obligated for any recourse mortgage debt or other financial obligations related to the property. Debt Financing, Financial Covenants, Degree of Leverage and Increases in Interest Rates Could Adversely Affect the Company's Economic Performance Scheduled Debt Payments Could Adversely Affect the Company's Financial Condition. The Company's business is subject to risks normally associated with debt financing. Cash flow could be insufficient to pay expected dividends to stockholders and meet required payments of principal and interest. The Company may not be able to refinance existing indebtedness (which in virtually all cases requires substantial principal payments at maturity) and, even if it can, the terms of such refinancing might not be as favorable as the terms of existing indebtedness. The total principal amount of the Company's outstanding indebtedness was approximately $1.2 billion as of December 31, 1999. If principal payments due at maturity cannot be refinanced, extended or paid with proceeds of other capital transactions, such as new equity capital, cash flow may not be sufficient in all years to repay all maturing debt. If prevailing interest rates or other factors at the time of refinancing (such as the possible reluctance of lenders to make commercial real estate loans) result in higher interest rates, increased interest expense would adversely affect cash flow and the Company's ability to service debt and pay expected dividends to stockholders. Financial Covenants Could Adversely Affect the Company's Financial Condition. If a property is mortgaged to secure payment of indebtedness and the Company is unable to meet mortgage payments, the holder of the mortgage or lender could foreclose on the property, resulting in loss of income and asset value. Certain of the mortgages contain customary negative covenants which, among other things, limit the Company's ability, without the prior consent of the lender, to further mortgage the property, to enter into new leases or materially modify existing leases, and to discontinue insurance coverage. In addition, the credit facilities and indentures under which the Company's senior uncollateralized indebtedness is issued contain certain financial and operating covenants, including, among other things, certain coverage ratios, as well as limitations on the Company's ability to incur secured and unsecured indebtedness, sell all or substantially all of the Company's assets and engage in mergers and consolidations and certain acquisitions. Foreclosure on mortgaged properties or an inability to refinance existing indebtedness would likely have a negative impact on the Company's financial condition and results of operations. The Company's Degree of Leverage Could Limit Its Ability to Obtain Additional Financing. The Company's organizational documents do not contain any limitation on the incurrence of indebtedness. The degree of leverage of the Company could have important consequences, including affecting the ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions, development or other general corporate purposes and making the Company more vulnerable to a downturn in business or the economy generally. The Company is Subject to Interest Rate Risk. Increases in interest rates, or the loss of the benefits of any hedging agreements of the Company, would increase the Company's interest expense, which would adversely affect cash flow and the Company's ability to service its debt and pay dividends to stockholders. As of December 31, 1999, the Company had $188.7 million outstanding under its uncollateralized revolving credit facilities under which advances bear interest at floating interest rates. One is a $122.5 million credit facility that expires in November 2000, and the other is a $122.5 million credit facility that expires in November 2002. As of December 31, 1999, the Company also had approximately $116 million in floating rate notes and mortgages outstanding, with $52 million maturing in May 2000, $12 million maturing in August 2000, $2 million maturing in November 2000 and approximately $50 million maturing in various amounts not exceeding $10 million each on various dates from July 2001 to June 2029. The Company was not a party to any hedging agreements with respect to its floating rate debt as of December 31, 1999. In the event of a significant increase in interest rates, the Company would consider entering into hedging agreements with 8 11 respect to all or a portion of its floating rate debt. Although hedging agreements would enable the Company to convert floating rate liabilities to fixed rate liabilities, they would expose the Company to the risk that the counterparties to such hedge agreements may not perform, which could increase the Company's exposure to rising interest rates. Generally, however, the counterparties to hedging agreements that the Company would enter into would be major financial institutions. The Company may borrow additional money with floating interest rates in the future. Increases in interest rates, or the loss of the benefits of any hedging agreements that the Company may enter into in the future, would increase the Company's interest expenses, which would adversely affect cash flow and the ability of the Company to service its debt. If the Company enters into any hedging agreements in the future, decreases in interest rates thereafter would increase the Company's interest expenses as compared to the underlying floating rate debt and could result in the Company making payments to unwind such agreements. The Ability of Stockholders to Effect Changes in Control of the Company is Limited Provisions of the Company's Charter and Bylaws Could Inhibit Changes in Control. Certain provisions of the Company's charter and bylaws may delay or prevent a change in control of the Company or other transactions that could provide stockholders with a premium over the then-prevailing market price of their common stock or that might otherwise be in the best interests of the stockholders. These include a staggered Board of Directors, a stockholder rights plan and the Company's share ownership limit described two paragraphs below. Also, any future series of preferred stock of the Company may have certain voting provisions that could delay or prevent a change in control or other transaction that might involve a premium price or otherwise be in the best interests of the stockholders. The Company Could Adopt Maryland Law Limitations on Changes in Control. Certain provisions of Maryland law applicable to REITs prohibit "business combinations" (including certain issuances of equity securities) with any person who beneficially owns ten percent or more of the voting power of outstanding shares, or with an affiliate of the REIT who, at any time within the two-year period prior to the date in question, was the beneficial owner of ten percent or more of the voting power of the outstanding voting shares (a so-called "interested stockholder"), or with an affiliate of an interested stockholder. These prohibitions last for five years after the most recent date on which the interested stockholder became an interested stockholder. After the five-year period, a business combination with an interested stockholder must be approved by two super-majority stockholder votes unless, among other conditions, the REIT's common stockholders receive a minimum price for their shares and the consideration is received in cash or in the same form as previously paid by the interested stockholder for its common shares. The Board of Directors of the Company has opted out of these business combination provisions. As a result, the five-year prohibition and the super-majority vote requirements will not apply to a business combination involving the Company. The Board of Directors may, however, repeal this election in most cases and cause the Company to become subject to these provisions in the future. The Company Has a Share Ownership Limit. To facilitate maintenance of the Company's REIT qualification and for other strategic reasons, the Company's charter generally prohibits any person from acquiring or holding shares of the Company's preferred and common stock in excess of 9.8% (by value or by number of shares, whichever is more restrictive) of the outstanding shares of each class or series of stock of the Company. The Company's Board of Directors may exempt a person from this ownership limit under specified conditions. Absent an exemption or a waiver, shares of stock that are purportedly transferred in excess of the ownership limit will be automatically transferred to a trust for the exclusive benefit of one or more charitable beneficiaries, and the purported transferee will not acquire any rights in such shares. This ownership limit could delay or prevent a change in control of the Company and, therefore, could adversely affect the stockholders' ability to realize a premium over the then-prevailing market price for their shares. The Company Does Not Control its Development Business To facilitate maintenance of its REIT qualification, the Company has an investment in and has made substantial loans to a noncontrolled company, ERT, that is engaged in the real estate development business, and has guaranteed approximately $103 million of indebtedness of ERT. At December 31, 1999, amounts 9 12 outstanding relating to the guarantees was $93.6 million. Although the Company owns 95% of the economic interest in ERT, the voting stock of ERT is owned by a private company controlled by an executive officer (and director) of the Company. The Company therefore does not control the timing or amount of dividends or the management and operations of this company. As a result, decisions relating to the declaration and payment of dividends and the business policies and operations of this company could be adverse to the Company's interests or could lead to adverse financial results, which could adversely affect the Company's financial condition and results of operations. Environmental Problems are Possible and Can Be Costly Federal, state and local laws and regulations relating to the protection of the environment may require a current or previous owner or operator of real estate to investigate and clean up hazardous or toxic substances or petroleum product releases at such property. The owner or operator may have to pay a governmental entity or third parties for property damage and for investigation and clean-up costs incurred by such parties in connection with the contamination. Such laws typically impose clean-up responsibility and liability without regard to whether the owner or operator knew of or caused the presence of contaminants. Even if more than one person may have been responsible for the contamination, each person covered by the environmental laws may be held responsible for all of the clean-up costs incurred. In addition, third parties may sue the owner or operator of a site for damages and costs resulting from environmental contamination emanating from that site. Environmental laws also govern the presence, maintenance and removal of asbestos. Such laws require that owners or operators of buildings containing asbestos properly manage and maintain the asbestos, that they notify and train those who may come into contact with asbestos and that they undertake special precautions, including removal or other abatement, if asbestos would be disturbed during renovation or demolition of a building. Such laws may impose fines and penalties on building owners or operators who fail to comply with these requirements and may allow third parties to seek recovery from owners or operators for personal injury associated with exposure to asbestos fibers. The Market Value of the Company's Publicly Traded Securities Can Be Adversely Affected by a Number of Factors Changes in Market Conditions Could Adversely Affect the Market Price of the Company's Publicly Traded Securities. As with other publicly traded securities, the value of the Company's publicly traded securities depends on various market conditions, which may change from time to time. Among the market conditions that may affect the value of its publicly traded securities are the following: the extent of institutional investor interest in the Company; the reputation of REITs generally; the reputation of REITs with portfolios similar to the Company's; the attractiveness of the securities of REITs in comparison to other securities (including securities issued by other real estate companies); the Company's financial condition and performance; and general economic and financial market conditions. The Company's Earnings and Cash Dividends Will Affect the Market Price of its Publicly Traded Securities. The Company believes that the market value of a REIT's equity securities is based primarily upon the market's perception of the REIT's growth potential and its current and potential future cash dividends, and is secondarily based upon the real estate market value of the underlying assets. For that reason, the Company's common stock may trade at prices that are higher or lower than the net asset value per share. To the extent the Company retains operating cash flow for investment purposes, working capital reserves or other purposes, these retained funds, while increasing the value of its underlying assets, may not correspondingly increase the market price of the Company's shares. Failure to meet the market's expectations with regard to future earnings and cash dividends likely would adversely affect the market price of the Company's publicly traded equity securities. Market Interest Rates May Affect the Value of the Company's Publicly Traded Securities. One of the factors that investors consider important in deciding whether to buy or sell shares of a REIT is the dividend rate on such shares (as a percentage of the price of such shares) relative to market interest rates. If market interest rates go up, prospective purchasers of REIT shares may expect a higher dividend rate. Higher interest 10 13 rates would not, however, result in more dividends and, in fact, likely would increase borrowing costs and potentially decrease funds available for dividends. Thus, higher market interest rates could cause the market price of the Company's publicly traded securities to go down. The Company is Dependent on External Sources of Capital To qualify as a REIT the Company must, among other things, distribute to its stockholders each year at least 95% of its REIT taxable income (excluding any net capital gains). Because of these distribution requirements, the Company likely will not be able to fund all future capital needs, including capital for acquisitions, with income from operations. The Company therefore will have to rely on third-party sources of capital, which may or may not be available on favorable terms or at all. The Company's access to third-party sources of capital depends on a number of things, including the market's perception of the Company's growth potential and the Company's current and potential future earnings. Moreover, additional equity offerings may result in substantial dilution of stockholders' interests, and additional debt financing may substantially increase leverage. The Company's Classification as a REIT is Dependent on Compliance with Federal Income Tax Requirements Failure of the Company to Qualify as a REIT Would Have Serious Adverse Consequences to Stockholders. The Company believes that its predecessor companies, New Plan Realty Trust and Excel Realty Trust, Inc., qualified for taxation as REITs for federal income tax purposes since their first elections to be taxed as REITs for the taxable years ended July 31, 1972 and December 31, 1987, respectively. The Company plans to continue to operate so that it meets the requirements for taxation as a REIT. Many of these requirements, however, are highly technical and complex. The determination that the Company is a REIT requires an analysis of various factual matters and circumstances that may not be totally within the Company's control. For example, to qualify as a REIT, at least 95% of the Company's gross income must come from certain sources that are itemized in the REIT tax laws. The Company is also required to distribute to stockholders at least 95% of its REIT taxable income (excluding any net capital gains). The fact that the Company holds certain of its assets through partnerships and their subsidiaries further complicates the application of the REIT requirements. Even a technical or inadvertent mistake could jeopardize the Company's REIT status. Furthermore, Congress and the Internal Revenue Service might make changes to the tax laws and regulations, and the courts might issue new rulings, that make it more difficult, or impossible, for the Company to remain qualified as a REIT. If the Company fails to qualify as a REIT, the Company would be subject to federal income tax at regular corporate rates. Also, unless the IRS granted the Company relief under certain statutory provisions, the Company would remain disqualified as a REIT for four years following the year the Company first failed to qualify. If the Company failed to qualify as a REIT, the Company would have to pay significant income taxes and would therefore have less money available for investments, debt service and dividends to stockholders. This likely would have a significant adverse affect on the value of its securities. In addition, the Company would no longer be required to pay any dividends to stockholders. The Company Could be Disqualified as a REIT or Have to Pay Taxes if its Predecessor Companies Did Not Qualify as REITs. If either New Plan Realty Trust or Excel Realty Trust, Inc., whose businesses were combined in a merger transaction on September 28, 1998 to form the Company, failed to qualify as a REIT throughout the duration of its existence, it might have had undistributed "C corporation earnings and profits." If that were the case and either of the Company's predecessor companies did not distribute such earnings and profits prior to the merger transaction, the Company might not qualify as a REIT. The Company believes that each of the predecessor companies qualified as a REIT and that, in any event, neither of the predecessor companies had any undistributed "C corporation earnings and profits" at the time of the merger transaction. If either of the predecessor companies failed to qualify as a REIT, it would have recognized taxable gain at the time of the merger transaction (and the Company would be liable for the tax on such gain). This would be the case even though the merger transaction qualified as a "tax-free reorganization," unless the Company makes a special election that is available under current law. The Company will make such an election with respect to 11 14 each of the predecessor companies. This election will have the effect of requiring the Company, if either of the predecessor companies was not qualified as a REIT, to pay corporate income tax on any gain existing at the time of the merger transaction on assets acquired in the transaction if such assets are sold within 10 years after the transaction. Finally, if either of the predecessor companies did not qualify as a REIT, the Company could be precluded from electing REIT status for up to four years after the year in which that predecessor company failed to qualify if the Company were determined to be a "successor" to that predecessor company. ITEM 2. PROPERTIES As of December 31, 1999, the Company owned interests in 303 retail properties (including one retail property under redevelopment, five office properties and two vacant land parcels) and 53 apartment communities (including three apartment communities under redevelopment). Properties held by ERT are excluded from the table below. The following table sets forth certain information as of December 31, 1999 regarding the Company's properties on a state-by-state basis:
RETAIL PROPERTIES APARTMENT COMMUNITIES ------------------------------------------------------------------------------------------------- PERCENT OF PERCENT OF GROSS SCHEDULED TOTAL SCHEDULED NUMBER OF PERCENT LEASABLE RETAIL NUMBER OF NUMBER OF PERCENT APARTMENT STATE PROPERTIES LEASED AREA ABR(1) PROPERTIES UNITS LEASED ABR(1) ----- ---------- ---------- ---------- ---------- ---------- --------- ------- ---------- Alabama..................... 7 98.7% 760,014 1.7% 9 2,271 93.3% 18.6% Arizona..................... 12 95.8% 1,107,370 3.6% -- -- -- -- Arkansas.................... 2 100.0% 105,459 0.2% -- -- -- -- California.................. 17 93.1% 2,504,151 10.3% -- -- -- -- Colorado.................... 2 100.0% 352,156 1.6% -- -- -- -- Delaware.................... 2 94.5% 243,934 0.5% 2 303 92.4% 2.6% Florida..................... 18 93.3% 2,693,482 7.6% 2 539 95.2% 5.8% Georgia..................... 34 91.0% 3,097,715 7.0% 2 420 96.7% 3.8% Illinois.................... 10 97.6% 1,231,057 4.2% -- -- -- -- Indiana..................... 14 92.6% 964,472 2.0% 3 893 86.3% 6.8% Iowa........................ 5 91.4% 604,896 1.2% -- -- -- -- Kentucky.................... 9 93.6% 1,456,210 3.4% 3 539 90.4% 4.7% Louisiana................... 2 98.6% 261,518 0.6% 3 1,244 86.6% 10.2% Maryland.................... 3 75.1% 380,529 0.9% -- -- -- -- Michigan.................... 13 90.5% 2,120,220 6.1% -- -- -- -- Minnesota................... 3 97.4% 85,898 0.4% -- -- -- -- Missouri.................... 4 87.3% 726,703 4.0% 1 309 94.2% 3.0% Nebraska.................... 3 100.0% 70,513 0.2% -- -- -- -- Nevada...................... 3 97.7% 587,377 2.0% -- -- -- -- New Jersey.................. 9 95.8% 1,133,595 4.2% -- -- -- -- New York.................... 26 86.8% 3,440,210 7.6% 2 308 94.5% 2.5% North Carolina.............. 17 94.7% 1,801,132 4.0% 2 463 89.2% 4.8% Ohio........................ 22 88.4% 3,181,127 7.0% 5 925 87.2% 8.2% Oklahoma.................... 1 100.0% 45,510 0.1% -- -- -- -- Pennsylvania................ 20 92.9% 2,280,379 6.6% 1 130 96.9% 1.3% South Carolina.............. 5 94.6% 376,324 1.1% 4 816 91.2% 6.7% Tennessee................... 16 94.5% 1,874,187 4.6% 11 2,480 89.1% 21.0% Texas....................... 7 98.7% 500,995 1.5% -- -- -- -- Utah........................ 1 97.6% 587,550 1.2% -- -- -- -- Virginia.................... 12 90.2% 1,676,495 3.8% -- -- -- -- West Virginia............... 3 94.2% 354,938 0.8% -- -- -- -- --- ----- ---------- ----- -- ------ ---- ----- 302 92.3% 36,606,116 100.0% 50 11,640 90.8% 100.0% === ===== ========== ===== == ====== ==== =====
12 15
RETAIL PROPERTIES -- UNDER REDEVELOPMENT APARTMENT COMMUNITIES -- UNDER REDEVELOPMENT --------------------------------------------------------------------------------------------------- PERCENT OF PERCENT OF GROSS SCHEDULED TOTAL SCHEDULED NUMBER OF PERCENT LEASABLE RETAIL NUMBER OF NUMBER OF PERCENT APARTMENT STATE PROPERTIES LEASED AREA ABR(1) PROPERTIES UNITS LEASED ABR(1) ----- ---------- ---------- ---------- ---------- ---------- ---------- -------- ---------- Florida..................... 1 N/A 679,661 N/A Kentucky.................... 1 244 N/A N/A Ohio........................ 2 676 N/A N/A --- ---------- -- ------ 303 37,285,777 53 12,560 === ========== == ======
- --------------- (1) ABR represents annualized base rent (contractual minimum lease payments as of December 31, 1999). ITEM 3. LEGAL PROCEEDINGS The Company is not presently involved in any material pending legal proceedings nor, to its knowledge, is any material litigation threatened against the Company or its properties, other than litigation arising in the ordinary course of business. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS No matters were submitted to a vote of the stockholders of the Company during the fourth quarter of 1999. PART II ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS The Company's common stock is listed for trading on the New York Stock Exchange under the symbol "NXL." As of March 1, 2000, there were approximately 13,743 registered record holders of the Company's common stock, plus those who hold their shares in street name. The following table sets forth the high and low sales price, as reported by the New York Stock Exchange composite tape, and the cash dividends declared each calendar quarter during 1999 and 1998 with respect to the Company's common stock:
CASH DIVIDENDS HIGH(1) LOW(1) DECLARED(1) -------- -------- ----------- 1998: First quarter........................ $29.6875 $25.2600 $0.4170 Second quarter....................... 25.0000(2) 21.6667(2) 0.4170 Third quarter........................ 25.0000 21.5000 0.4170 Fourth quarter....................... 23.6875 20.0625 0.4000 1999: First quarter........................ $22.5625 $18.7500 $0.4025 Second quarter....................... 20.6875 18.0000 0.4050 Third quarter........................ 19.2500 17.6250 0.4075 Fourth quarter....................... 18.0000 14.7500 0.4100
- --------------- (1) The high and low sales price and cash dividends declared prior to the merger transaction on September 28, 1998 are those of Excel Realty Trust, Inc., and have been adjusted to reflect the 20% stock dividend that Excel Realty Trust, Inc. paid in connection with the merger transaction. The actual cash dividends declared by Excel Realty Trust, Inc. were $0.50 for each of the first, second and third quarters of 1998. (2) On March 31, 1998, Excel Realty Trust, Inc. consummated a spin-off of Excel Legacy Corporation through the distribution, on a pro-rata basis, to the holders of Excel Realty Trust, Inc.'s common stock, of all of the common stock of Excel Legacy Corporation held by Excel Realty Trust, Inc. 13 16 ITEM 6. SELECTED FINANCIAL DATA The financial information included in the following table has been derived from the audited consolidated financial statements for the periods indicated. This information should be read together with the audited financial statements of the Company and Management's Discussion and Analysis of the Financial Condition and Results of Operations included elsewhere in this Annual Report on Form 10-K. On September 28, 1998, Excel Realty Trust, Inc. ("Excel") and New Plan Realty Trust (the "Trust") consummated a merger whereby a wholly owned subsidiary of Excel was merged with and into the Trust with the Trust surviving as a wholly owned subsidiary of Excel (the "Merger"). As a result of the Merger, the shareholders of the Trust immediately prior to the Merger owned approximately 65% of the Company's common stock outstanding immediately following the Merger. In connection with the merger transaction, Excel changed its name to "New Plan Excel Realty Trust, Inc." Under generally accepted accounting principles, the Merger was accounted for as a purchase by the Trust of Excel. Therefore, all of the financial information prior to September 28, 1998 included in the following table is that of the Trust. Because the Trust had a fiscal year end of July 31 prior to the Merger, the financial information included in the following table for periods prior to September 28, 1998 is based on a fiscal year end of July 31. All of the financial information included in the following table for periods on and after September 28, 1998 relates to the Company as a combined entity. Immediately following the Merger, each of the Company and the Trust adopted a fiscal year end of December 31, beginning with a short fiscal year ending on December 31, 1998. (IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS)
FIVE MONTHS YEAR ENDED ENDED YEARS ENDED JULY 31, DECEMBER 31, DECEMBER 31, --------------------------------------------- 1999 1998 1998 1997 1996 1995 ------------ ------------ ---------- ---------- -------- -------- STATEMENT OF INCOME DATA: Revenue.................................... $ 438,027 $ 155,921 $ 250,259 $ 206,821 $167,606 $130,576 Expenses................................... 295,171 99,693 159,645 129,781 97,484 68,088 ---------- ---------- ---------- ---------- -------- -------- 142,856 56,228 90,614 77,040 70,122 62,488 Minority interest.......................... (1,299) (457) -- -- -- -- Gain/(loss) on sales of properties and securities, net.......................... 7,956 34 (41) (3) 399 228 ---------- ---------- ---------- ---------- -------- -------- Net income................................. 149,513 55,805 90,573 77,037 70,521 62,716 Preferred dividends........................ (22,777) (6,914) (5,850) (461) -- -- ---------- ---------- ---------- ---------- -------- -------- Net income applicable to common shareholders............................. $ 126,736 $ 48,891 $ 84,723 $ 76,576 $ 70,521 $ 62,716 ========== ========== ========== ========== ======== ======== Net income per common share Basic.................................. $ 1.43 $ 0.63 $ 1.43 $ 1.31 $ 1.25 $ 1.19 Diluted................................ $ 1.42 $ 0.62 $ 1.42 $ 1.30 $ 1.25 $ 1.18 Weighted average number of common shares outstanding Basic.................................. 88,662 77,481 59,365 58,461 56,484 52,894 Diluted................................ 90,440 79,396 59,774 58,735 56,642 53,040 OTHER DATA: Distributions per common share............. $ 1.625 $ 0.678 $ 1.475 $ 1.435 $ 1.395 $ 1.355 ========== ========== ========== ========== ======== ======== BALANCE SHEET DATA AS OF THE END OF EACH PERIOD: Total assets............................... $2,953,141 $2,896,568 $1,386,831 $1,263,958 $948,477 $800,006 Long-term debt obligations................. 1,220,451 1,105,271 576,888 478,207 238,426 206,652 Shareholders' equity....................... 1,611,519 1,662,242 766,833 747,719 662,438 573,900
14 17 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS LIQUIDITY AND CAPITAL RESOURCES Cash flow from operations has been the principal source of capital to fund the Company's ongoing operations. The Company's issuance of common and preferred stock, use of the Company's revolving credit facilities and financing from uncollateralized notes and mortgage debt have been the principal sources of capital required to fund its growth. In order to continue to expand and develop its portfolio of properties and other investments, the Company intends to finance future acquisitions and growth through the most advantageous sources of capital available to the Company at the time, which may include excess cash flow, the sale of common stock, preferred stock or debt securities through public offerings or private placements, the incurrence of additional indebtedness through borrowings, and the reinvestment of proceeds from the disposition of assets. The Company also may enter into joint ventures with institutions to acquire large properties. The Company's financing strategy is to maintain a strong and flexible financial position by (i) maintaining a prudent level of leverage, (ii) maintaining a large pool of unencumbered properties, (iii) managing its exposure to interest rate risk represented by its floating rate debt and (iv) where possible, amortizing existing non-recourse mortgage debt secured by specific properties over the term of the leases with anchor tenants at such mortgaged properties. As of December 31, 1999, the Company had approximately $12.0 million in available cash, cash equivalents and marketable securities. The Company has two revolving credit facilities with The Bank of New York, each of which provides for $122.5 million in uncollateralized advances from a group of banks. One facility expires in November 2000 and the other expires in November 2002. As of December 31, 1999, the Company had $188.7 million outstanding under these facilities. The covenants of these credit facilities include maintaining certain ratios such as liabilities to assets of less than 50% and maintaining a minimum unencumbered assets coverage ratio of 2 to 1. In addition, on March 7, 2000, the Company established a term loan facility with Fleet National Bank, pursuant to which the Company may draw down up to $75 million through April 27, 2000. Loans drawn under this facility will mature on March 5, 2001, and accrue interest at LIBOR plus 80 basis points (based on the Company's current credit rating). The term loan agreement prepared in connection with the facility contains covenants substantially similar to those included in the two credit facilities of the Company with The Bank of New York. In addition to outstanding amounts on the Company's credit facilities, debt as of December 31, 1999 consisted of $341.6 million of mortgages payable having a weighted average interest rate of 7.8% and $662.7 million of notes payable with a weighted average interest rate of 7.2%. Of this debt, $115.8 million bear variable interest rates. Additionally, the Company has $1.2 million in marketable equity securities which are sensitive to market price changes and notes receivable in the amount of Canadian $16.0 million (approximately U.S. $11.1 million as of December 31, 1999) which are sensitive to currency exchange rate fluctuations. The Company has guaranteed approximately $103 million of indebtedness of ERT. At December 31, 1999, loan amounts outstanding related to these guarantees was approximately $93.6 million. ERT has third-party debt of $84 million, excluding notes payable to the Company, having a weighted average interest rate of 9.0%. The Company provides substantially all of the capital required to fund ERT's operations. In November 1998, the Company filed a $1 billion shelf registration statement. This registration statement was filed for the purpose of issuing debt securities, preferred stock, depository shares, common stock, warrants or rights. On February 3, 1999, the Company established under this shelf registration statement a program for the sale of up to $500 million aggregate principal amount of medium-term notes due nine months or more from date of issue. On July 15, 1999, the Company issued $175 million aggregate principal amount of notes under its medium-term notes program in two series. The Company issued $150 million with a 10-year maturity and a coupon of 7.4% and $25 million of another series with a 30-year maturity and a coupon of 7.5%. The net proceeds of these issuances were used to reduce the outstanding balance on the Company's credit facility. In September 1999, the Company re-established its medium-term notes program in the aggregate principal amount of $325 million. On November 12, 1999, the Company issued 15 18 $49 million aggregate principal amount of notes under its medium-term notes program with a four-year maturity and a coupon of 7.33%. In October 1999, the Company announced that its Board of Directors had authorized the repurchase of up to $75 million of the Company's outstanding common stock from time to time through periodic open market transactions or through privately negotiated transactions. Through December 31, 1999, 1,231,000 shares had been repurchased and retired at an average purchase price of $16.36 per share. In May 1999, an additional 1,226,000 shares were purchased from seven executives, all formerly of Excel, who resigned. The purchase price was $21 per share. Other sources of funds are available to the Company. Based on management's internal evaluation of the Company's properties, many of which are free and clear of mortgages, the estimated value is considerably in excess of the outstanding mortgage indebtedness. Accordingly, management believes that potential exists for additional mortgage financing as well as unsecured borrowing capacity from banks and other lenders. The Company has three classes of preferred stock outstanding as of December 31, 1999: (i) 1,507,000 shares of 8 1/2% Series A Cumulative Convertible Preferred Stock outstanding which have an annual distribution of $2.125 per share payable quarterly; (ii) 6,300,000 depositary shares outstanding, each representing 1/10 of a share of 8 5/8% Series B Cumulative Redeemable Preferred Stock, with an annual distribution of $2.15625 per depositary share payable quarterly; and (iii) 1,500,000 depositary shares outstanding, each representing 1/10 of one share of 7.8% Series D Cumulative Voting Step-Up Premium Rate Preferred Stock, with a liquidation preference and annual distribution of $50 and $3.90 per depositary share, respectively. The current quarterly dividend on the Company's common stock is $.4125 per share. The maintenance of this dividend will be subject to various factors, including the discretion of the Board of Directors of the Company, the ability to pay dividends under applicable law and the effect which the payment of dividends may have from time to time on the maintenance by the Company of its status as a REIT. In the normal course of business, the Company also faces risks that are either non-financial or non-qualitative. Such risks principally include credit risks and legal risks and are not included in the aforementioned notes. ENVIRONMENTAL MATTERS Under various federal, state and local laws, ordinances and regulations, the Company may be considered an owner or operator of real property or may have arranged for the disposal or treatment of hazardous or toxic substances and, therefore, may become liable for the costs of removal or remediation of certain hazardous substances released on or in its property or disposed of by it, as well as certain other potential costs which could relate to hazardous or toxic substances (including governmental fines and injuries to persons and property). Such liability may be imposed whether or not the Company knew of, or was responsible for, the presence of such hazardous or toxic substances. Except as discussed below, the Company is not aware of any significant environmental condition at any of its properties. Soil and groundwater contamination exists at certain of the Company's properties. The primary contaminants of concern at these properties include perchloroethylene and trichloroethyleme (associated with the operations of on-site dry cleaners), petroleum hydrocarbons (associated with the operations of on-site auto repair facilities) and methyl tertiary butyl ether (from unknown sources). The Company currently estimates that the total cost of remediation of environmental conditions at these properties will be in the range of approximately $2.8 million to $6.5 million, although there can be no assurance that this range of estimates will prove accurate. In connection with certain of these properties, the Company has entered into remediation and indemnity agreements, which obligate the prior owners of the properties (including, in some cases, principals of the prior owners) to perform the remediation and to indemnify the Company for any losses the Company may suffer because of the contamination or remediation. There can be no assurance, however, that the prior owners will perform their obligations under these agreements, although in certain cases prior owners have set aside funds in escrow with respect to their performance under these agreements. In connection with certain 16 19 other properties, the former tenants at the properties are in the process of performing the necessary remediation, although there can be no assurance that such remediation will be satisfactory. In connection with certain additional properties, the Company has assumed the obligation to perform the necessary remediation in connection with the Company's purchase of the properties. In addition to the environmental conditions discussed above, asbestos minerals (associated with spray-applied fireproofing materials) exist at certain of the Company's properties. The Company currently estimates that the total cost of remediation of asbestos minerals at these properties will be approximately $3 million, although there can be no assurance that this estimate will prove accurate. The Company does not expect the environmental conditions at its properties, considered as a whole, to have a material adverse effect on the Company. YEAR 2000 COMPLIANCE The Company's Year 2000 review involved (i) an assessment of the Year 2000 problems that may affect the Company, (ii) the development of remedies to address the problems discovered in the assessment phase to the extent practical or feasible, (iii) the testing of such remedies, and (iv) the preparation of contingency plans to deal with worst case scenarios. As of the date of this report, the Company has not encountered any material business interruptions or adverse financial consequences related to the Year 2000 issue. The Company currently estimates that the total historical and anticipated remaining costs related to the Year 2000 issue will be immaterial to the Company's financial condition. RECENTLY ISSUED ACCOUNTING STANDARDS In June 1998, the Financial Accounting Standards Board issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities." SFAS No. 133 establishes accounting and reporting standards for derivative instruments, including certain derivative instruments imbedded in other contracts, and hedging activities. It requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value as issued. SFAS No. 133 is effective January 1, 2000; however, SFAS 137, "Deferral of the Effective Date of SFAS 133," extends the effective date for the Company to January 2001. The Company does not anticipate that the adoption of SFAS 133 will have a material impact on its financial statements. At its meeting on October 27, 1999, NAREIT's leadership clarified the industry's supplemental performance measure to confirm that funds from operations should include all operating results, both recurring and nonrecurring, except for those results defined as "extraordinary items" under generally accepted accounting principles and gains and losses from sales of depreciable operating properties. The clarification is effective for years beginning January 1, 2000. RESULTS OF OPERATIONS The following discussion should be read in conjunction with the Consolidated Financial Statements and the Notes thereto. Historical results and percentage relationships set forth in the Consolidated Statements of Income contained in the Consolidated Financial Statements and accompanying notes, including trends which might appear, should not be taken as indicative of future operations. Twelve Months Ended December 31, 1999 Compared to the Twelve Months Ended December 31, 1998 The results of operations reflected in the Consolidated Statements of Income and Comprehensive Income include post-Merger results for the twelve months ended December 31, 1999 and the five months ended December 31, 1998. The following includes pro forma financial information for the year ended December 31, 1998 presented as if the Merger had been consummated on January 1, 1998 in order to make the comparison of 1999 and 1998 more informative. Except as stated otherwise, the discussions below relate to comparison of actual results for the twelve-month period ended December 31, 1999 to pro forma results for the twelve-month period ended December 31, 1998. The pro forma results are not necessarily indicative of what the results would have been if the Merger actually occurred on January 1, 1998. 17 20 The actual results of operations for the twelve months ended December 31, 1998 have been derived by aggregating the estimated results of operations and cash flows for the month ended January 31, 1998, the amounts reported for the three months ended April 30 and July 31, 1998, and the actual results for the five months ended December 31, 1998 (which reflect the Merger as of September 28, 1998). (IN THOUSANDS, EXCEPT FOR PER SHARE AMOUNTS)
TWELVE MONTHS ENDED DECEMBER 31, --------------------------------- 1999 1998 1998 (ACTUAL) (PRO FORMA) (ACTUAL) -------- ----------- -------- Revenues Retail................................................. $337,004 $322,884 $225,931 Residential............................................ 77,477 74,415 71,662 Interest, dividend and other........................... 23,546 21,253 7,840 -------- -------- -------- Total revenues.................................... 438,027 418,552 305,433 Expenses Operating costs........................................ 90,612 81,614 68,737 Real estate and other taxes............................ 38,929 36,380 27,286 Interest............................................... 81,412 71,902 49,655 Depreciation and amortization.......................... 62,912 58,865 40,416 Provision for doubtful accounts........................ 6,144 6,285 5,366 Non-recurring charges.................................. 8,497 -- -- General and administrative............................. 6,665 7,719 3,758 -------- -------- -------- Total expenses.................................... 295,171 262,765 195,218 -------- -------- -------- Income before real estate sales and minority interest....... 142,856 155,787 110,215 Sale of real estate/securities.............................. 7,956 371 58 Minority interest in income from partnership................ (1,299) (1,684) (457) -------- -------- -------- Net Income.................................................. $149,513 $154,474 $109,816 ======== ======== ======== Net income per share: Basic.................................................. $ 1.43 $ 1.49 $ 1.48 ======== ======== ======== Diluted................................................ $ 1.42 $ 1.46 $ 1.47 ======== ======== ========
All changes between 1998 actual results and 1999 actual results are primarily attributable to the Merger as well as the impact of property acquisitions made by Excel during 1998. Accordingly, the following discussions reflect a comparison of pro forma 1998 data to actual 1999 data. The Company acquired 36 properties between January 1, 1998 and December 31, 1999, including 31 retail and five residential properties. These retail acquisitions produced increased revenue of $16.2 million in 1999. In addition, revenue in the current period was reduced $1.1 million because of the sale of six properties and was reduced $1.7 million because of an adjustment of common area maintenance revenue relating to certain properties. The remaining retail revenue change was an increase of $0.7 million, or 0.2%. The residential acquisitions produced increased revenue of $3.9 million and the sale of two properties reduced revenue by $0.5 million in fiscal year 1999. The remaining residential revenue change was a decrease of $0.4 million, or 0.5%. The increase in interest, dividend and other revenues was primarily the result of the following factors. The net effect of an interest revenue increase and equity revenue decrease from ERT Development Corporation was a decrease of $2.8 million. This decrease was offset by increases in interest revenues from development notes receivable of $1.1 million, currency gains of $1.8 million, financing commitment fees revenue of $1.4 million and an insurance recovery of $0.5 million. The remaining interest, dividend and other revenue change was an increase of $0.3 million, or 1.0%. 18 21 Property acquisitions and the assumption of related debt resulted in $14.3 million of the $32.4 million increase in total expenses, including a $5.6 million increase in operating costs, $4.0 million in additional depreciation, $1.8 million in additional real estate and taxes, and $2.9 million in interest expense. The remaining $3.4 million increase in operating costs is principally attributable to increases in snow removal, professional service costs and turnover costs in the residential division during the current year. The remaining $6.6 million increase in interest expense was primarily the result of increased borrowings in connection with property acquisitions, severance costs and common stock repurchases resulting from the resignation of seven executives, all formally of Excel Realty Trust, Inc. and the purchase by the Company of Excel Realty Partners, L.P. partnership units. The decrease of $1.1 million in general and administrative costs relates primarily to staff reductions in the closing of the Company's San Diego office which was partially offset by a non-recurring increase in professional fees of approximately $0.8 million related to a terminated acquisition of another company. The $8.5 million non-recurring charge is a result of payments of $1.7 million in severance payments, $6.0 million in stock compensation expense related to the settlement of outstanding stock options and $0.8 million of other costs related to the resignation of the aforementioned seven executives in April 1999. Five Months Ended December 31, 1998 Compared to Five Months Ended December 31, 1997 The actual results of operations for the five-month period ended December 31, 1998 only include operations of Excel from September 28, 1998 to December 31, 1998. Therefore, certain pro forma comparisons are included which have been presented as if the Merger had been consummated on August 1, 1998 and 1997, respectively. The pro forma information is not necessarily indicative of what the actual results of operations of the Company would have been had the Merger actually occurred on August 1, 1998 and 1997, respectively (in thousands, except for per share amounts):
FIVE MONTHS FIVE MONTHS FIVE MONTHS ENDED ENDED ENDED DECEMBER 31, DECEMBER 31, DECEMBER 31, 1998 1998 1997 (ACTUAL) (PRO FORMA) (ACTUAL) ------------ ------------ ------------ Total revenues.......................................... $155,921 $179,092 $100,457 Expenses: Operating costs.................................... 32,764 32,233 25,325 Real estate and other taxes........................ 13,456 15,655 9,047 Interest........................................... 27,168 32,339 14,309 Depreciation and amortization...................... 21,366 25,644 12,544 Provision for doubtful accounts.................... 2,825 2,884 1,675 General and administrative......................... 2,114 2,849 1,143 -------- -------- -------- Total expenses................................ 99,693 111,604 64,043 Gain/(loss) on sale of real estate/securities........... 34 34 (67) Minority interest in income from partnership............ (457) (739) -- -------- -------- -------- Net income.............................................. $ 55,805 $ 66,783 $ 36,347 ======== ======== ======== Net income per share: Basic.............................................. $ 0.63 $ 0.66 $ 0.62 ======== ======== ======== Diluted............................................ $ 0.62 $ 0.64 $ 0.61 ======== ======== ========
Excel acquired 22 properties from August 1997 to September 1998 which are reflected in the pro forma results of operations for the five months ended December 31, 1998 and 1997 above. As previously discussed, however, operations of Excel are included in actual results only for the period from the Merger to December 31, 1998. In addition to the acquisitions Excel has made, the Company acquired 23 properties from August 1997 to December 1998. 19 22 Historical Comparison Total revenues increased approximately $55.5 million to $155.9 million, or 55%. Of the increase, $42.6 million related to additional revenues from Excel as a result of the Merger. In addition to the Merger, the 23 properties that were acquired since August 1997 accounted for $9.8 million of the increased revenues in 1998 when compared to the five-month period ended December 31, 1997. The remaining $3.1 million increase was primarily a result of net increases in rentals from the remaining portfolio of properties. Of the $155.9 million in revenue in 1998, $32.5 million related to the 54 apartment communities and $117.9 million related to the 301 property retail portfolio (including four office buildings and two vacant land parcels). Interest, dividend and other income accounted for $5.5 million in revenue. In 1997, $27.2 million of revenue related to the apartment portfolio, $71.6 million related to the retail portfolio, and $1.7 million related to interest and dividends. Total expenses increased $35.7 million to $99.7 million, or 56%. Of the increase, $27.2 million related to additional expenses from Excel as a result of the Merger. In addition to the Merger, the properties that were acquired since August 1997 accounted for $4.8 million of additional expenses, excluding interest expense. Interest expense of $3.1 million related to the assumption of $56.7 million in mortgage debt from the property acquisitions, and $50.0 million of additional notes payable. The remaining $0.6 million relates to increased expenses from the Company's existing portfolio. Operating costs increased $7.5 million to $32.8 million, of which the Merger accounted for $6.0 million. The properties acquired since August 1997 accounted for $2.4 million of increases and other properties accounted for a decrease in operating costs of $0.9 million. Real estate and other taxes increased $4.5 million to $13.5 million, of which $3.2 million related to Excel as a result of the Merger, $0.9 million related to the properties acquired since August 1997 and $0.4 million related to increases on the remaining portfolio. Interest expense increased $12.9 million to $27.2 million, of which $9.8 million related to the Merger and $3.1 million related to additional debt as described above. Depreciation and amortization increased $8.9 million to $21.4 million, of which $6.9 million related to the Merger and the remaining $2.0 million related to the properties acquired since August 1997. Finally, provision for doubtful accounts increased $1.1 million to $2.8 million, of which $0.4 million related to the Merger, and general and administrative costs increased $1.0 million, of which $0.9 million related to the Merger. Pro Forma Comparison On a pro forma basis, total revenues increased $28.9 million to $179.1 million, or 19%. Of this increase, $28.2 million relates to the acquisition of 45 properties since August 1997. Also in 1997, the Company recognized income from its equity investment in ERT in the amount of $1.8 million, compared to a loss in 1998 of $1.1 million which is included in the expenses below. The remaining difference in revenue between the periods is $2.5 million and is primarily a result of net increases in rentals from the remaining portfolio of properties. On a pro forma basis, total expenses increased $18.0 million to $111.6 million, or 19%. Properties acquired since August 1997 accounted for $17.3 million, including increased interest expense from Excel of $3.1 million, primarily related to additional debt related to acquisitions. General and administrative expenses increased $0.5 million on a pro forma basis, but remained 1.6% of total revenues. The remaining difference is a net decrease of $0.9 million, which primarily relates to the Company's remaining portfolio of properties. Fiscal Year Ended July 31, 1998 Compared to Fiscal Year Ended July 31, 1997 In fiscal 1998, total revenues increased $43.5 million to $250.3 million, or 21%. The increase was in rental income and related revenues and came from all categories of properties. Interest and dividend income decreased approximately $0.8 million because of lower average investment balances. Expenses increased $29.8 million to $159.6 million, or 23%. Operating costs, real estate and other taxes, and depreciation and amortization increased primarily because of property acquisitions. Interest expense increased $8.6 million to $36.8 million, primarily due to a higher level of outstanding uncollateralized notes 20 23 and mortgage debt during fiscal 1998. The increase in the provision for doubtful accounts reflects a larger revenue base and a higher level of receivables. Administrative expenses as a percentage of revenue remained constant at 1.1% of revenue compared to fiscal 1997. Funds From Operations The Company calculates funds from operations ("FFO") as net income attributable to common shareholders on a diluted basis before gain or loss on sales of real estate and securities, plus depreciation and amortization on real estate and amortized leasing commission costs, and non-recurring items. FFO is not a substitute for cash flows from operating activities or net income as defined by generally accepted accounting principles, and may not be comparable to other similarly titled measures of other REITs. FFO is presented because industry analysts and the Company consider FFO to be an appropriate supplemental measure of performance of REITs. The following information is included to show the items included in the Company's FFO for the past periods indicated (in thousands, except per share amounts):
YEAR FIVE MONTHS FIVE MONTHS ENDED ENDED ENDED YEAR ENDED YEAR ENDED DECEMBER 31, DECEMBER 31, DECEMBER 31, JULY 31, JULY 31, 1999 1998 1997 1998 1997 ------------ ------------ ------------ ---------- ---------- Net income.......................... $149,513 $55,805 $36,347 $ 90,573 $ 77,037 Preferred dividends............ (22,777) (6,914) (2,437) (5,850) (461) Minority interest.............. 1,299 457 -- -- -- -------- ------- ------- -------- -------- Net income applicable to common shareholders -- diluted........... 128,035 49,348 33,910 84,723 76,576 (Gains)/loss on real estate and securities........................ (7,956) (34) 67 41 3 Dilutive preferred A dividends...... 3,343 -- -- -- -- Depreciation and amortization, including depreciation relating to equity investments................ 66,389 21,366 12,544 31,622 25,006 Non-recurring charge................ 8,497 -- -- -- -- -------- ------- ------- -------- -------- Funds from operations............... $198,308 $70,680 $46,521 $116,386 $101,585 ======== ======= ======= ======== ======== Weighted average of common shares outstanding -- diluted............ 92,397 79,396 59,720 59,774 58,735 ======== ======= ======= ======== ======== FFO per share -- diluted............ $ 2.15 $ 0.89 $ 0.78 $ 1.95 $ 1.73 ======== ======= ======= ======== ========
Preferred A shares have a dilutive effect on the FFO calculation. On a pro forma basis, FFO would have been $83,974 and $72,318 for the five months ended December 31, 1998 and 1997, had the Merger been consummated on August 1, 1998 and 1997, respectively. ECONOMIC CONDITIONS The majority of the Company's leases contain provisions designed to mitigate the adverse impact of inflation. Such provisions include clauses enabling the Company to receive percentage rents which generally increase as prices rise, and/or escalation clauses which are typically related to increases in the consumer price index or similar inflation indices. In addition, the Company believes that many of its existing lease rates are below current market levels for comparable space and that upon renewal or re-rental such rates may be increased to current market rates. This belief is based upon an analysis of relevant market conditions, including a comparison of comparable market rental rates, and upon the fact that many of such leases have been in place for a number of years and may not contain escalation clauses sufficient to match the increase in market rental rates over such time. Most of the Company's leases require the tenant to pay its share of operating expenses, including common area maintenance, real estate taxes and insurance, thereby reducing the Company's exposure to increases in costs and operating expenses resulting from inflation. In addition, the 21 24 Company periodically evaluates its exposure to interest rate fluctuations, and may enter into interest rate protection agreements which mitigate, but do not eliminate, the effect of changes in interest rates on its floating rate loans. Many regions of the United States, including regions in which the Company owns property, may experience economic recessions. Such recessions, or other adverse changes in general or local economic conditions, could result in the inability of some existing tenants of the Company to meet their lease obligations and could otherwise adversely affect the Company's ability to attract or retain tenants. The Company's shopping centers are typically anchored by discount department stores, supermarkets and drug stores which usually offer day-to-day necessities rather than high priced luxury items. These types of tenants, in the experience of the Company, generally continue to maintain their volume of sales despite a slowdown in economic conditions. ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Increases in interest rates would increase the Company's interest expense, which would adversely affect the Company's cash flow. As of December 31, 1999, the Company had approximately $305 million of outstanding floating rate debt. The Company does not believe that the interest rate risk represented by its floating rate debt is material as of that date in relation to the approximately $1.2 billion of outstanding total debt of the Company and the approximately $3.0 billion of total assets of the Company. The Company was not a party to any hedging agreements with respect to its floating rate debt as of December 31, 1999. In the event of a significant increase in interest rates, the Company would consider entering into hedging agreements with respect to all or a portion of its floating rate debt. Although hedging agreements would enable the Company to convert floating rate liabilities into fixed rate liabilities, such agreements would expose the Company to the risk that the counterparties to such hedge agreements may not perform, which could increase the Company's exposure to rising interest rates. Generally, however, the counterparties to hedging agreements that the Company would enter into would be major financial institutions. The Company may borrow additional money with floating interest rates in the future. Increases in interest rates, or the loss of the benefits of any hedging agreements that the Company may enter into in the future, would increase the Company's interest expense, which would adversely affect cash flow and the ability of the Company to service its debt. If the Company enters into any hedging agreements in the future, decreases in interest rates thereafter would increase the Company's interest expense as compared to the underlying floating rate debt and could result in the Company making payments to unwind such agreements. If the market rates of interest on the Company's variable rate debt change by 10% (or approximately 70 basis points) the Company's interest expense would change by approximately $2.0 million, assuming the amount of the Company's outstanding floating rate debt remains at $305 million, the balance at December 31, 1999. As of December 31, 1999, the Company had notes receivable in the total amount of Canadian $16 million (approximately U.S. $11.1 million as of December 31, 1999). The Company does not believe that the foreign currency exchange risk associated with these loans is material. The Company had no other material exposure to market risk (including foreign currency exchange risk, commodity price risk or equity price risk) as of December 31, 1999. ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Financial statements required by this item appear with an Index to Financial Statements and Schedules, starting on page F-1 of this report. ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE Not applicable. 22 25 PART III ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT The information required by this item is hereby incorporated by reference to the material appearing in the Proxy Statement for the Annual Stockholders Meeting to be held in 2000 (the "Proxy Statement") under the captions "Proposal 1 -- Election of Directors," "Executive Compensation and Other Information" and "Other Matters -- Section 16(a) Beneficial Ownership Reporting Compliance." ITEM 11. EXECUTIVE COMPENSATION The information required by this item is hereby incorporated by reference to the material appearing in the Proxy Statement under the caption "Executive Compensation and Other Information." ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT The information required by this item is hereby incorporated by reference to the material appearing in the Proxy Statement under the caption "Voting Securities and Certain Beneficial Owners and Management." ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS The information required by this item is hereby incorporated by reference to the material appearing in the Proxy Statement under the caption "Certain Relationships and Related Transactions." PART IV ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K (a) Consolidated Financial Statements. The following documents are filed as a part of this report: The response to this portion of Item 14 is submitted as a separate section of this report. (b) Reports on Form 8-K filed during the three months ended December 31, 1999. None. (c) Exhibits. The following documents are filed as exhibits to this report: *3.1 Articles of Amendment and Restatement of the Charter of the Company filed as Exhibit 3.01 to Amendment No. 1 to the Company's Registration Statement on Form S-3, File No. 33-59195. *3.2 Articles of Amendment of Articles of Amendment and Restatement of the Charter of the Company filed as Exhibit 4.4 to the Company's Registration Statement on Form S-3, File No. 333-65211. *3.3 Amended and Restated Bylaws of the Company filed as Exhibit 4.6 to the Company's Registration Statement on Form S-3, File No. 333-65211. *3.4 Amendments to the Bylaws of the Company, dated April 21, 1999, filed as Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q/A for the quarter ended June 30, 1999. *3.5 Amendments to the Bylaws of the Company, dated June 3, 1999, filed as Exhibit 3.2 to the Company's Quarterly Report on Form 10-Q/A for the quarter ended June 30, 1999. 3.6 Amendments to the Bylaws of the Company, dated February 7, 2000. *4.1 Articles Supplementary classifying 4,600,000 shares of preferred stock as 8 1/2% Series A Cumulative Convertible Preferred Stock filed as Exhibit 4.01 to the Company's Current Report on Form 8-K dated February 7, 1997.
23 26 *4.2 Articles Supplementary classifying 690,000 shares of preferred stock as 8 5/8% Series B Cumulative Redeemable Preferred Stock filed as Exhibit 4.02 to the Company's Current Report on Form 8-K dated January 14, 1998. *4.3 Articles Supplementary relating to the Series C Junior Participating Preferred Stock of the Company, which may in the future be issued under the Company's Rights Plan filed as Exhibit 4.3 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *4.4 Articles Supplementary classifying 150,000 shares of preferred stock as 7.80% Series D Cumulative Voting Step-Up Premium Rate Preferred Stock filed as Exhibit 4.5 to the Company's Registration Statement on Form S-3, File No. 333-65211. *10.1 Amended and Restated 1993 Stock Option Plan of the Company filed as Exhibit 4.1 to the Company's Registration Statement on Form S-8, File No. 333-65223. *10.2 Amendment to the Amended and Restated 1993 Stock Option Plan of the Company, dated May 28, 1998, dated September 28, 1998, filed as Exhibit 10.4 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *10.3 Amendment to the Amended and Restated 1993 Stock Option Plan of the Company, dated February 8, 1999, filed as Exhibit 10.5 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. 10.4 Amendment to the Amended and Restated 1993 Stock Option Plan of the Company, dated April 21, 1999. 10.5 Amendment to the Amended and Restated 1993 Stock Option Plan of the Company, dated February 17, 2000. *10.6 Directors' Amended and Restated 1994 Stock Option Plan of the Company, dated May 10, 1996, filed as Exhibit 10.8 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *10.7 Amendment to the Amended and Restated 1994 Directors' Stock Option Plan of the Company, dated September 28, 1998, filed as Exhibit 10.9 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. 10.8 Amendment to the Amended and Restated 1994 Directors' Stock Option Plan of the Company, dated February 17, 2000. *10.9 New Plan Realty Trust 1997 Stock Option Plan filed as Exhibit 4.1 to the Company's Registration Statement on Form S-8, File No. 333-65221. *10.10 New Plan Realty Trust 1991 Stock Option Plan, as amended, filed as Exhibit 4.2 to the Company's Registration Statement on Form S-8, File No. 333-65221. *10.11 Amended and Restated New Plan Realty Trust 1985 Incentive Stock Option Plan filed as Exhibit 4.3 to the Company's Registration Statement on Form S-8, File No. 333-65221. *10.12 New Plan Realty Trust March 1991 Stock Option Plan and Non-Qualified Stock Option Plan filed as Exhibit 4.4 to the Company's Registration Statement on Form S-8, File No. 333-65221. 10.13 Credit Agreement, dated as of November 17, 1999, by and among New Plan Excel Realty Trust, Inc., the lenders party thereto, The Bank of New York, as administrative agent, and Bank One, NA and BankBoston, N.A., each as co-documentation agent. 10.14 Guaranty, dated as of November 17, 1999, by and among New Plan Realty Trust, Excel Realty Trust -- ST, Inc. and The Bank of New York, as administrative agent. 10.15 Credit Agreement, dated as of November 17, 1999, by and among New Plan Excel Realty Trust, Inc., the lenders party thereto, The Bank of New York, as administrative agent, and Bank One, NA and BankBoston, N.A., each as co-documentation agent. 10.16 Guaranty, dated as of November 17, 1999, by and among New Plan Realty Trust, Excel Realty Trust -- ST, Inc. and The Bank of New York, as administrative agent.
24 27 *10.17 Indenture, dated as of May 8, 1995, between the Company and State Street Bank and Trust Company of California, N.A. (as successor to the First National Bank of Boston) filed as Exhibit 4.01 to the Company's Registration Statement on Form S-3, File No. 33-59195, as amended, on May 9, 1995. *10.18 First Supplemental Indenture, dated as of April 4, 1997, between the Company and State Street Bank and Trust Company of California, N.A. filed as Exhibit 4.02 to the Company's Registration Statement on Form S-3, File No. 333-24615, as amended, on April 4, 1997. *10.19 Second Supplemental Indenture, dated as of July 3, 1997, between the Company and State Street Bank and Trust Company of California, N.A. filed as Exhibit 4.01 to the Company's Current Report on Form 8-K dated July 3, 1997. *10.20 Senior Securities Indenture, dated as of March 29, 1995, between New Plan Realty Trust and The First National Bank of Boston, as Trustee filed as Exhibit 4.2 to New Plan Realty Trust's Registration Statement on Form S-3, File No. 33-60045. *10.21 First Supplemental Indenture, dated as of August 5, 1999, by and among New Plan Realty Trust, New Plan Excel Realty Trust, Inc. and State Street Bank and Trust Company filed as Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999. *10.22 Senior Securities Indenture, dated as of February 3, 1999, among the Company, New Plan Realty Trust, as guarantor, and State Street Bank and Trust Company, as Trustee, filed as Exhibit 4.1 to the Company's Current Report on Form 8-K dated February 3, 1999. *10.23 Amended and Restated Agreement of Limited Partnership of Excel Realty Partners, L.P., dated as of June 25, 1997, filed as Exhibit 10.20 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997. *10.24 First Amendment to Amended and Restated Agreement of Limited Partnership of Excel Realty Partners, L.P., dated as of August 20, 1999, by and among New Plan DRP Trust, New Plan Excel Realty Trust, Inc. and the current and future partners in the partnership filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999. *10.25 Master Separation Agreement, dated as of April 21, 1999, among New Plan Excel Realty Trust, Inc., ERT Development Corporation and Excel Legacy Corporation filed as Exhibit 10.1 to the Company's Current Report on Form 8-K dated April 22, 1999. *10.26 Resignation and Release Agreement, dated as of April 21, 1999, entered into between the Company and Gary B. Sabin filed as Exhibit 10.2 to the Company's Current Report on Form 8-K dated April 22, 1999. *10.27 Resignation and Release Agreement, dated as of April 21, 1999, entered into between the Company and Richard B. Muir filed as Exhibit 10.3 to the Company's Current Report on Form 8-K dated April 22, 1999. *10.28 Agreement and Plan of Merger, dated May 14, 1998, as amended as of August 7, 1998, among the Company, ERT Merger Sub, Inc. and New Plan Realty Trust filed, as Exhibit 2.1 to the Company's Registration Statement on Form S-4, File No. 333-61131. *10.29 Rights Agreement, dated as of May 15, 1998, between the Company and BankBoston, N.A., filed as Exhibit 4 to the Company's Report on Form 8-A dated May 19, 1998. *10.30 First Amendment to Rights Agreement, dated as of February 8, 1999, between the Company and BankBoston, N.A. filed as Exhibit 4.1 to the Company's Report on Form 8-A/A (Amendment No. 1) dated May 5, 1999. *10.31 Dividend Reinvestment and Share Purchase Plan filed as Exhibit 4.7 to the Company's Registration Statement on Form S-3, File No. 333-65211.
25 28 *10.32 Employment Agreement, dated as of September 17, 1998, by and between the Company and William Newman, filed as Exhibit 10.39 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *10.33 Employment Agreement, dated as of February 23, 2000, by and between the Company and Glenn J. Rufrano, filed as Exhibit 10.1 to the Company's Current Report on Form 8-K, dated March 9, 2000. *10.34 Employment Agreement, dated as of September 25, 1998, by and between the Company and James M. Steuterman, filed as Exhibit 10.43 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *10.35 Employment Agreement, dated as of September 25, 1998, by and between the Company and Steven F. Siegel, filed as Exhibit 10.45 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. 10.36 Employment Agreement, dated as of September 25, 1998, by and between the Company and James DeCicco. *10.37 Support Agreement, dated as of May 14, 1998, by William Newman to the Company, filed as Exhibit 10.7 to the Company's Registration Statement on Form S-4, File No. 333-61131, dated August 11, 1998. *10.38 Agreement, dated as of February 23, 2000, by and between the Company and Arnold Laubich, filed as Exhibit 10.9 to the Company's Current Report on Form 8-K, dated March 9, 2000. 10.39 Unconditional Guaranty of Payment and Performance, dated as of January 28, 2000, by the Company (Pointe Orlando). *10.40 Unconditional Guaranty of Payment and Performance, dated as of January 13, 1997, by the Company (Briar Preston Ridge), filed as Exhibit 10.49 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. 10.41 Term Loan Agreement, dated as of March 7, 2000, between the Company and Fleet National Bank 10.42 Guaranty, dated as of March 7, 2000, by the Trust and Excel Realty Trust -- ST, Inc. 12 Ratio of Earnings to Fixed Charges. 21 Subsidiaries of the Registrant. 23 Consent of PricewaterhouseCoopers LLP. 27(1) Financial Data Schedule.
- --------------- * Incorporated herein by reference as above indicated. (1) Filed as exhibit to electronic filing only. (d) Financial Statement Schedules. The following documents are filed as a part of this report: The response to this portion of Item 14 is submitted as a separate section of this report. 26 29 NEW PLAN REALTY TRUST INC. AND SUBSIDIARIES INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
PAGE ---- 1. CONSOLIDATED STATEMENTS Report of Independent Auditors.............................. F-2 Consolidated Balance Sheets December 31, 1999, December 31, 1998 and July 31, 1998.... F-3 Consolidated Statements of Income and Comprehensive Income for the Year ended December 31, 1999, the Five Months ended December 31, 1998 and the Years ended July 31, 1998 and 1997.................................................. F-4 Consolidated Statements of Changes in Shareholders' Equity for the Year ended December 31, 1999, the Five Months ended December 31, 1998, and the Years ended July 31, 1998 and 1997.................................................. F-5 Consolidated Statements of Cash Flows for the Year ended December 31, 1999, the Five Months ended December 31, 1998 and the Years ended July 31, 1998, and 1997............... F-6 Notes to Consolidated Financial Statements.................. F-7 2. CONSOLIDATED FINANCIAL STATEMENT SCHEDULES: Schedule II -- Valuation and Qualifying Accounts............ F-23 Schedule III -- Real Estate and Accumulated Depreciation.... F-24 Schedule IV -- Mortgage Loans on Real Estate................ F-51
F-1 30 REPORT OF INDEPENDENT AUDITORS To the Board of Directors and Stockholders of New Plan Excel Realty Trust, Inc.: In our opinion, the consolidated financial statements listed in the accompanying index present fairly, in all material respects, the consolidated financial position of New Plan Excel Realty Trust, Inc. and its subsidiaries at December 31, 1999 and 1998 and July 31, 1998, and the related consolidated results of their operations and cash flows for the year ended December 31, 1999, the five months ended December 31, 1998 and each of the two years in the period ended July 31, 1998, in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedules listed in the accompanying index present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedules are the responsibility of the Company's management; our responsibility is to express an opinion on these financial statements and schedules based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP New York, New York February 17, 2000 F-2 31 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS DECEMBER 31, 1999, DECEMBER 31, 1998 AND JULY 31, 1998 (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) ASSETS
DECEMBER 31, DECEMBER 31, JULY 31, 1999 1998 1998 ------------ ------------ ---------- Real estate: Land...................................................... $ 552,146 $ 545,400 $ 272,176 Building and improvements................................. 2,328,499 2,280,069 1,180,562 Accumulated depreciation.................................. (216,274) (158,021) (136,978) ---------- ---------- ---------- Net real estate..................................... 2,664,371 2,667,448 1,315,760 Cash and cash equivalents................................... 10,834 13,951 26,284 Marketable securities....................................... 1,190 1,700 1,787 Receivables: Trade, less allowance for doubtful accounts of $13,897, $11,636 and $7,926 at December 31, 1999, December 31, 1998 and July 31, 1998, respectively.................... 30,225 23,422 14,025 Other, net................................................ 15,825 12,155 3,682 Mortgages and notes receivable.............................. 59,142 50,065 13,878 Prepaid expenses and deferred charges....................... 13,076 6,181 7,823 Investment in and loans to ERT Development Corporation...... 150,432 113,779 -- Other assets................................................ 8,046 7,867 3,592 ---------- ---------- ---------- Total assets........................................ $2,953,141 $2,896,568 $1,386,831 ========== ========== ========== LIABILITIES AND STOCKHOLDERS' EQUITY Liabilities: Mortgages payable, including unamortized premium of $9,921 and $12,345 at December 31, 1999 and 1998, respectively............................................ $ 341,643 $ 388,185 $ 114,099 Notes payable, net of unamortized discount of $2,264, $1,141 and $1,211 at December 31, 1999, December 31, 1998 and July 31, 1998 respectively................................ 662,736 489,235 462,789 Credit facilities........................................... 188,721 200,500 -- Capital leases.............................................. 27,351 27,351 -- Other liabilities........................................... 88,591 81,263 37,520 Tenant security deposits.................................... 7,480 7,141 5,590 ---------- ---------- ---------- Total liabilities................................... 1,316,522 1,193,675 619,998 ---------- ---------- ---------- Minority interest in partnership............................ 25,100 40,651 -- ---------- ---------- ---------- Commitments and contingencies............................... -- -- -- Stockholders' equity: Preferred stock, Series A: $.01 par value, 25,000 shares authorized: 4,600 shares designated as 8 1/2% Series A Cumulative Convertible Preferred 1,507 and 2,124 outstanding at December 31, 1999 and 1998, respectively; Series B: 6,300 depository shares, each representing 1/10 of one share of 8 5/8% Series B Cumulative Redeemable Preferred, 630 outstanding at December 31, 1999 and 1998; Series D: 1,500 depositary shares, each representing 1/10 of one share of Series D Cumulative Voting Step-Up Premium Rate Preferred, 150 shares outstanding at December 31, 1999, December 31, 1998 and July 31, 1998........................................... 23 29 72,775 Common stock, $.01 par value, 250,000 shares authorized; 87,555 and 88,384 shares issued and outstanding as of December 31, 1999 and 1998, respectively................ 875 884 -- Shares of beneficial interest, no par value, 59,874 shares outstanding at July 31, 1998............................................. -- -- 759,853 Additional paid-in capital.................................. 1,708,186 1,735,207 -- Accumulated other comprehensive income...................... 214 726 813 Accumulated distribution in excess of net income............ (97,779) (74,604) (66,608) ---------- ---------- ---------- Total stockholders' equity.......................... 1,611,519 1,662,242 766,833 ---------- ---------- ---------- Total liabilities and stockholders' equity.......... $2,953,141 $2,896,568 $1,386,831 ========== ========== ==========
The accompanying notes are an integral part of the consolidated financial statements. F-3 32 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME FOR THE YEAR ENDED DECEMBER 31, 1999, THE FIVE MONTHS ENDED DECEMBER 31, 1998 AND THE YEARS ENDED JULY 31, 1998 AND 1997 (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
YEAR ENDED YEAR ENDED FIVE MONTHS ENDED ------------------- DECEMBER 31, DECEMBER 31, JULY 31, JULY 31, 1999 1998 1998 1997 ------------ ----------------- -------- -------- Revenues: Rental income and related revenues......... $414,481 $150,411 $246,309 $202,093 Interest, dividend and other income........ 23,546 5,510 3,950 4,728 -------- -------- -------- -------- Total revenues..................... 438,027 155,921 250,259 206,821 -------- -------- -------- -------- Expenses: Operating costs............................ 90,612 32,764 61,417 52,584 Real estate and other taxes................ 38,929 13,456 22,850 18,449 Interest................................... 81,412 27,168 36,815 28,256 Depreciation and amortization.............. 62,912 21,366 31,622 25,006 Provision for doubtful accounts............ 6,144 2,825 4,171 3,283 Non-recurring charge....................... 8,497 -- -- -- General and administrative................. 6,665 2,114 2,770 2,203 -------- -------- -------- -------- Total expenses..................... 295,171 99,693 159,645 129,781 -------- -------- -------- -------- Income before real estate sales and minority interest....................... 142,856 56,228 90,614 77,040 Gain/(loss) on sale of real estate and securities................................. 7,956 34 (41) (3) Minority interest in income of partnership... (1,299) (457) -- -- -------- -------- -------- -------- Net income................................... 149,513 55,805 90,573 77,037 Other comprehensive income (loss): Unrealized gain (loss) on securities for the period.............................. (512) (87) (244) 414 -------- -------- -------- -------- Comprehensive income......................... $149,001 $ 55,718 $ 90,329 $ 77,451 ======== ======== ======== ======== Net income available to common stock -- basic...................................... $126,736 $ 48,891 $ 84,723 $ 76,576 ======== ======== ======== ======== Net income available to common stock -- diluted.................................... $128,035 $ 49,348 $ 84,723 $ 76,576 ======== ======== ======== ======== Basic earnings per common share.............. $ 1.43 $ 0.63 $ 1.43 $ 1.31 ======== ======== ======== ======== Diluted earnings per common share............ $ 1.42 $ 0.62 $ 1.42 $ 1.30 ======== ======== ======== ======== Average shares outstanding -- basic.......... 88,662 77,481 59,365 58,461 ======== ======== ======== ======== Average shares outstanding -- diluted........ 90,440 79,396 59,774 58,735 ======== ======== ======== ========
The accompanying notes are an integral part of the consolidated financial statements. F-4 33 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY FOR THE YEAR ENDED DECEMBER 31, 1999, THE FIVE MONTHS ENDED DECEMBER 31, 1998 AND THE YEARS ENDED JULY 31, 1998 AND JULY 31, 1997 (IN THOUSANDS)
SHARES OF BENEFICIAL INTEREST/ ACCUMULATED PREFERRED STOCK COMMON STOCK ADDITIONAL OTHER ----------------- -------------------- PAID-IN COMPREHENSIVE NUMBER AMOUNT NUMBER AMOUNT CAPITAL INCOME ------ -------- ------- ---------- ---------- ------------- Balance at July 31, 1996...................... -- $ -- 58,069 $ 719,080 $ -- $ 643 Net income.................................... -- -- -- -- -- -- Dividends paid................................ -- -- -- -- -- -- Dividend reinvestment......................... -- -- 750 16,475 -- -- Exercise of stock options..................... -- -- 115 2,456 -- -- Unrealized holding gain on marketable securities.................................. -- -- -- -- 414 Issuance of preferred shares.................. 150 72,775 -- -- -- -- ----- -------- ------ --------- ---------- ------ Balance at July 31, 1997...................... 150 72,775 58,934 738,011 -- 1,057 Net income.................................... -- -- -- -- -- -- Dividends paid................................ -- -- -- -- -- -- Dividend reinvestment......................... -- -- 765 18,197 -- -- Exercise of stock options..................... -- -- 175 3,645 -- -- Unrealized holding gain on marketable securities.................................. -- -- -- -- -- (244) ----- -------- ------ --------- ---------- ------ Balance at July 31, 1998...................... 150 72,775 59,874 759,853 -- 813 Net income.................................... -- -- -- -- -- -- Dividends..................................... -- -- -- -- -- -- Dividend reinvestment......................... -- -- 235 4,373 -- -- Merger transactions........................... 2,755 (72,746) 28,275 (763,342) 1,735,207 -- Unrealized holding gain on marketable securities.................................. -- -- -- -- -- (87) ----- -------- ------ --------- ---------- ------ Balance at December 31, 1998.................. 2,905 29 88,384 884 1,735,207 726 Net income.................................... -- -- -- -- -- -- Dividends..................................... -- -- -- -- -- -- Dividend reinvestment......................... -- -- 907 9 17,155 -- Exercise of stock options..................... -- -- 66 1 1,334 -- Shares repurchased and retired................ -- -- (2,457) (25) (45,510) -- Conversion of preferred shares................ (618) (6) 655 6 -- -- Unrealized holding gain on marketable securities.................................. -- -- -- -- -- (512) ----- -------- ------ --------- ---------- ------ Balance at December 31, 1999.................. 2,287 $ 23 87,555 $ 875 $1,708,186 $ 214 ===== ======== ====== ========= ========== ====== ACCUMULATED DISTRIBUTIONS TOTAL IN EXCESS OF STOCKHOLDERS' NET INCOME EQUITY ------------- -------------- Balance at July 31, 1996...................... $ (57,286) $ 662,437 Net income.................................... 77,037 77,037 Dividends paid................................ (83,825) (83,825) Dividend reinvestment......................... -- 16,475 Exercise of stock options..................... -- 2,456 Unrealized holding gain on marketable securities.................................. -- 414 Issuance of preferred shares.................. -- 72,775 --------- ---------- Balance at July 31, 1997...................... (64,074) 747,769 Net income.................................... 90,573 90,573 Dividends paid................................ (93,107) (93,107) Dividend reinvestment......................... -- 18,197 Exercise of stock options..................... -- 3,645 Unrealized holding gain on marketable securities.................................. -- (244) --------- ---------- Balance at July 31, 1998...................... (66,608) 766,833 Net income.................................... 55,805 55,805 Dividends..................................... (63,801) (63,801) Dividend reinvestment......................... -- 4,373 Merger transactions........................... -- 899,119 Unrealized holding gain on marketable securities.................................. -- (87) --------- ---------- Balance at December 31, 1998.................. (74,604) 1,662,242 Net income.................................... 149,513 149,513 Dividends..................................... (172,688) (172,688) Dividend reinvestment......................... -- 17,164 Exercise of stock options..................... -- 1,335 Shares repurchased and retired................ -- (45,535) Conversion of preferred shares................ -- -- Unrealized holding gain on marketable securities.................................. -- (512) --------- ---------- Balance at December 31, 1999.................. $ (97,779) $1,611,519 ========= ==========
The accompanying notes are an integral part of the consolidated financial statements F-5 34 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 1999, THE FIVE MONTHS ENDED DECEMBER 31, 1998 AND THE YEARS ENDED JULY 31, 1998 AND 1997 (IN THOUSANDS)
YEAR ENDED YEAR ENDED FIVE MONTHS ENDED --------------------- DECEMBER 31, DECEMBER 31, JULY 31, JULY 31, 1999 1998 1998 1997 ------------ ----------------- --------- --------- Cash flows from operating activities: Net income.............................................. $ 149,513 $ 55,805 $ 90,573 $ 77,037 Adjustments to reconcile net income to net cash provided by operations: Depreciation and amortization......................... 62,912 21,366 31,622 25,006 Amortization of premium/discount on mortgages and notes payable....................................... (3,547) -- -- -- Foreign currency gain................................. (674) -- -- -- Provision for bad debts............................... 6,144 2,825 4,171 3,283 (Gain)/loss on sale of properties, net................ (7,956) (34) 67 10 Loss on sale of securities, net....................... -- -- (26) (7) Minority interest in income of partnership............ 1,299 457 -- -- Equity in loss of affiliate........................... 3,169 1,123 -- -- Cash received in connection with the Merger........... -- 4,892 -- -- Change in investment in and accrued interest on loans to ERT Development Corporation...................... (10,977) -- -- -- Changes in operating assets and liabilities, net: Change in trade receivable............................ (12,947) (6,673) (6,161) (3,733) Change in other receivables........................... (7,739) (13,257) 88 (355) Change in other liabilities........................... (1,950) (18,076) 4,161 3,475 Change in sundry assets and liabilities............... (11,392) 3,152 (2,988) 605 --------- --------- --------- --------- Net cash provided by operating activities......... 165,855 51,580 121,507 105,321 --------- --------- --------- --------- Cash flows from investing activities: Real estate acquisitions and building improvements...... (55,719) (34,959) (123,036) (282,607) Proceeds from real estate sales, net.................... 28,350 329 (67) 3,862 Mortgage loans.......................................... (14,373) (26,948) -- -- Loans to ERT Development Corporation.................... (28,845) -- -- -- Repayments of mortgage notes receivable................. 5,713 479 9,229 491 Sales of marketable securities.......................... 84 -- 29 484 Purchases of marketable securities...................... (2) -- (1) (2) Purchase of minority interest........................... (22,415) -- -- -- --------- --------- --------- --------- Net cash used in investing activities............. (87,207) (61,099) (113,846) (277,772) --------- --------- --------- --------- Cash flows from financing activities: Proceeds from issuing notes............................. 224,000 135,500 50,000 235,144 Principal payments of mortgages and notes payable....... (98,850) (113,427) (3,401) (32,362) Dividends paid.......................................... (166,443) (28,934) (93,107) (83,825) Minority interest distributions paid.................... (3,249) (910) -- -- Issuance of preferred stock............................. -- -- -- 72,775 Issuance of common stock/beneficial interest............ -- 4,673 21,842 18,931 Proceeds from dividend reinvestment plan................ 17,164 -- -- -- Repayment of credit facility............................ (458,417) -- -- -- Proceeds from credit facility........................... 446,637 -- -- -- Proceeds from exercise of stock options................. 1,335 -- -- -- Payments for the repurchase of common stock............. (43,942) -- -- -- Repayment of loans receivable for the purchase of common stock................................................. -- 284 508 269 --------- --------- --------- --------- Net cash (used in) provided by financing activities...................................... (81,765) (2,814) (24,158) 210,932 --------- --------- --------- --------- Net increase (decrease) in cash and cash equivalents..................................... (3,117) (12,333) (16,497) 38,481 Cash and cash equivalents at beginning of year............ 13,951 26,284 42,781 4,300 --------- --------- --------- --------- Cash and cash equivalents at end of year.................. $ 10,834 $ 13,951 $ 26,284 $ 42,781 ========= ========= ========= =========
The accompanying notes are an integral part of the consolidated financial statements. F-6 35 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Organization Excel Realty Trust, Inc. ("Excel") was formed in 1985 and subsequently reincorporated as a Maryland corporation. New Plan Realty Trust (the "Trust") was organized in 1972 as a Massachusetts business trust. On September 28, 1998, Excel and the Trust consummated a merger pursuant to an Agreement and Plan of Merger dated as of May 14, 1998, as amended as of August 7, 1998 (the "Merger Agreement"), whereby ERT Merger Sub, Inc., a wholly owned subsidiary of Excel, was merged with and into the Trust with the Trust surviving as a wholly owned subsidiary of Excel (the "Merger"). The Merger was approved by the stockholders of Excel and the shareholders of the Trust at special meetings held on September 25, 1998. In connection with the consummation of the Merger, Excel changed its name to New Plan Excel Realty Trust, Inc. (the "Company"). The Company is operated as a self-administered, self-managed real estate investment trust ("REIT") which owns and operates residential and retail properties throughout the United States. Change in Fiscal Year As discussed in Note 21 below, the Merger was treated as a purchase by the Trust of assets and liabilities of Excel using the purchase method of accounting in the accompanying consolidated financial statements. Because the Trust, as the accounting acquirer, had a fiscal year end of July 31, immediately following the Merger the Company and the Trust adopted a fiscal year end of December 31, beginning with a short fiscal year ending on December 31, 1998. The actual results of operations for the five month period ended December 31, 1998 include operations of Excel only from September 28, 1998 to December 31, 1998. Principles of Consolidation The accompanying consolidated financial statements include the accounts of the Company, its wholly owned subsidiaries and Excel Realty Partners, L.P., a Delaware limited partnership ("ERP"). All significant intercompany transactions and balances have been eliminated. The Company uses the equity method to account for its investment in ERT Development Corporation ("ERT"), a Delaware corporation (Note 6). Income Taxes The Company has elected to be treated as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986. In order to maintain its qualification as a REIT, among other things, the Company must distribute at least 95% of its REIT taxable income to its stockholders and meet certain tests regarding the nature of its income and assets. As a REIT, the Company is not subject to federal income tax with respect to that portion of its income which meets certain criteria and is distributed annually to the stockholders. Accordingly, no provision for federal income taxes is included in the accompanying consolidated financial statements. The Company plans to continue to operate so that it meets the requirements for taxation as a REIT. Many of these requirements, however, are highly technical and complex. If the Company were to fail to meet these requirements, the Company would be subject to Federal income tax. The Company may be subject to tax by certain states that do not recognize a Real Estate Investment Trust as a legal entity. Provision for such taxes has been included in real estate and other taxes. Cash Equivalents Cash equivalents consist of short-term, highly liquid debt instruments with original maturities of three months or less. Items classified as cash equivalents include insured bank certificates of deposit and commercial paper. At times, cash balances at a limited number of banks may exceed insurable amounts. The Company believes it mitigates its risk by investing in or through major financial institutions. F-7 36 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) Real Estate Land, buildings and building improvements are recorded at cost. Depreciation is computed using the straight-line method over estimated useful lives of 35 and 40 years for buildings and 5 to 40 years for building improvements. Tenant improvements are depreciated using the straight-line method over the life of the lease. Expenditures for maintenance and repairs are charged to expense as incurred and significant renovations are capitalized. The Company assesses whether there has been a permanent impairment in the value of its real estate by comparing its carrying amount to the aggregate undiscounted future cash flows without interest charges. Such cash flows consider factors such as expected future operating income, trends and prospects as well as the effects of demand, competition and other economic factors. Such market factors include a lessee's ability to pay rent under the terms of the lease. If a property is leased at a significantly lower rent, the Company may recognize a loss if the income stream is not sufficient to recover its investment. Deferred Leasing and Loan Acquisition Costs Costs incurred in obtaining tenant leases are amortized on the straight-line method over the terms of the related leases. Costs incurred in obtaining long-term financing are amortized over the life of the loan and charged to interest expense over the terms of the related debt agreements which approximates the effective interest method. Revenue Recognition Rental revenue is recognized on the straight-line basis, which averages minimum rents over the terms of the leases. Certain of the leases provide for additional rental revenue by way of percentage rents to be paid based upon the level of sales achieved by the lessee. These percentage rents are recorded once the required sales level is achieved and are included on the Consolidated Statements of Income in rental income and related revenues. The leases also typically provide for tenant reimbursement of common area maintenance and other operating expenses which are also included as rental revenues. Net Income Per Share of Common Stock Basic earnings per share ("EPS") is computed by dividing income available to common stockholders by the weighted average number of common shares outstanding for the period. Diluted EPS is computed giving effect to all dilutive potential common shares that were outstanding during the period. Dilutive potential common shares consist of the incremental common shares issuable upon the conversion of convertible preferred stock (using the "if converted" method), exercise of stock options and upon conversion of ERP limited partnership interests for all periods. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the period. Actual results could differ from those estimates. The most significant assumptions and estimates relate to depreciable lives, impairments of real estate, the recovery of mortgage notes and trade accounts receivables and recovery of the Company's interest in ERT. Reclassifications Certain amounts on the Balance Sheet as of December 31, 1998 have been reclassified to conform to the current period's presentation. Other receivables includes amounts previously classified in stockholders' equity F-8 37 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) of $2 million as loans receivable for purchase of shares of beneficial interest. Investment in and loans to ERT Development Corporation was classified formerly as other assets and mortgages receivable. Other liabilities and stockholders' equity as of December 31, 1998 has been revised to reflect the accrual of common dividends of $35 million declared as of December 31, 1998. Internal Software Costs Any costs associated with modifying computer software for Year 2000 compliance are expensed as incurred. 2. RECENTLY ISSUED ACCOUNTING STANDARDS: In June 1998, the Financial Accounting Standards Board issued SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities". SFAS No. 133 establishes accounting and reporting standards for derivative instruments, including certain derivative instruments imbedded in other contracts and hedging activities. It requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value as issued. SFAS No. 133 is effective January 1, 2000; however, SFAS 137, "Deferral of the Effective Date of SFAS 133", extends the effective date for the Company to January 2001. The Company does not anticipate that the adoption of SFAS 133 will have a material impact on its financial statements. 3. MARKETABLE SECURITIES: The Company has classified all investments in equity securities as available-for-sale. All investments are recorded at current market value with an offsetting adjustment to stockholders' equity (in thousands):
DECEMBER 31, DECEMBER 31, JULY 31, 1999 1998 1998 ------------ ------------ -------- Amortized cost/basis.................... $ 976 $ 974 $ 974 Unrealized holding gains................ 214 726 813 ------ ------ ------ Fair value.............................. $1,190 $1,700 $1,787 ====== ====== ======
The weighted average method is used to determine realized gain or loss on securities sold. The fair value of marketable securities is based upon quoted market prices as of December 31, 1999 and 1998 and July 31, 1998, respectively. F-9 38 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 4. MORTGAGES, NOTES AND OTHER RECEIVABLES: The Company had the following mortgages and notes receivable, including notes from affiliates (in thousands):
DECEMBER 31, DECEMBER 31, JULY 31, 1999 1998 1998 ------------ ------------ -------- Notes from development companies, monthly interest from 11% to 12% per annum. Maturity dates vary depending upon the completion or sale of certain properties....................................... $33,334 $25,169 $ -- Note from a development company, effective interest rate of 10%, payable in Canadian dollars. Due May 2003............................................. 11,113 10,439 -- Purchase money first mortgages, interest at 7.2% to 10%. Due 2000 to 2001............................ 10,738 10,738 11,480 Leasehold mortgages, interest at 10% to 12%. Due 2008............................................. 2,650 2,460 2,186 Other.............................................. 1,307 1,259 212 ------- ------- ------- Total.................................... $59,142 $50,065 $13,878 ======= ======= =======
The Company has notes receivable in the total amount of Canadian $16,050,000 (US $11,113,000, $10,439,000 and $0 at December 31, 1999, 1998 and July 31, 1998, respectively) from a Canadian company which used the proceeds to acquire a 50% joint venture interest in a mixed-use commercial building known as "Atrium on the Bay", and an adjacent building in Toronto, Canada. The loan is collateralized by the Canadian company's interest in the joint venture. The Company established $43,646,000 in credit facilities to certain developers. The total outstanding amounts on the credit facilities of $33,334,000 carry interest at 11% to 12% and are payable on the earlier of the sale of real estate or 2004. At December 31, 1999 and 1998, $9,663,000 and $8,548,000 of the other receivables on the accompanying balance sheet represents interest and dividends receivable, most of which represents interest receivable related to notes from development companies. The Company has assessed its ability to collect these receivables and expects to realize interest and principal in accordance with the terms of the notes. 5. EXCEL REALTY PARTNERS, L.P.: In 1995, ERP, a consolidated entity, was formed to own and manage certain real estate properties. A wholly owned subsidiary of the Company is the sole general partner of ERP and is entitled to receive 99% of all net income and gains before depreciation, if any, after the limited partners receive their stipulated distributions. Properties have been contributed to ERP in exchange for limited partnership units (which may be redeemed at stipulated prices for cash or the issuance of the Company common shares at the Company's option), cash and the assumption of mortgage debt. These units can convert to Company shares at exchange ratios from 1.0 to 1.4 Company shares for each unit. At December 31, 1999 and 1998, there were approximately 3,256,000 and 3,231,000 limited partner units outstanding of which the Company owned approximately 2,164,000 and 1,525,000 units. During 1999 the Company acquired an additional 634,000 units for $22.4 million in cash. 6. ERT DEVELOPMENT CORPORATION: In 1995, ERT was organized to finance, acquire, develop, hold and sell real estate in the short-term for capital gains and/or to receive fee income. The Company owns 100% of the outstanding preferred shares of ERT. An officer and director of the Company owns all the common shares. The preferred shares are entitled F-10 39 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) to receive 95% of dividends, if any. Cash requirements to facilitate ERT's transactions have primarily been obtained through borrowings from the Company. Investment in and loans to ERT are comprised of the following (in thousands):
DECEMBER 31, DECEMBER 31, 1999 1998 ------------ ------------ Investment.................................................. $ 4,227 $ 7,332 Loans and accounts receivable............................... 129,790 100,058 Accrued interest............................................ 16,415 6,389 -------- -------- $150,432 $113,779 ======== ========
Interest and principal payments from ERT are primarily received upon the completion of development projects. Interest receivable from ERT was $16,415,000 and $6,488,000 at December 31, 1999 and 1998, respectively. Interest income recognized by the Company was $14,842,000 and $2,764,000 in 1999 and for the five months ended December 31, 1998, respectively. For the twelve months ended December 31, 1999 and the three months ended December 31, 1998, the equity in the losses of ERT recorded by New Plan Excel Realty Trust, Inc. was ($3.2 million) and ($1.1 million), respectively. Summary unaudited financial information for ERT is as follows (in thousands).
DECEMBER 31, DECEMBER 31, 1999 1998 ------------ ------------ CONDENSED BALANCE SHEETS Notes receivable from developers, December 31, 1999 and 1998 interest at 10% to 12% and 10% to 20%, respectively....... $ 33,405 $ 61,108 Real estate and other assets, net of depreciation........... 212,238 53,353 -------- -------- Total Assets...................................... $245,643 $114,461 ======== ======== Notes payable to New Plan Excel Realty Trust, Inc. ......... $128,903 $100,058 Accrued interest payable to New Plan Excel Realty Trust, Inc. ..................................................... 16,415 6,389 Construction and land loans................................. 84,013 -- Other liabilities........................................... 12,085 682 -------- -------- Total liabilities................................. 241,416 107,129 Total stockholders' equity.................................. 4,227 7,332 -------- -------- Total liabilities and stockholders' equity........ $245,643 $114,461 ======== ========
YEAR ENDED THREE MONTHS ENDED DECEMBER 31, DECEMBER 31, 1999 1998 ------------ ------------------ (SEE NOTE 21) CONDENSED STATEMENTS OF INCOME Revenues............................................... $ 20,107 $ 2,019 Interest expense to New Plan Excel Realty Trust, Inc. ................................................ (14,842) (2,764) Other expenses......................................... (8,434) (378) -------- ------- Net loss..................................... $ (3,169) $(1,123) ======== =======
At December 31, 1998, ERT's receivables include loans of approximately $29.7 million made to a partnership in which ERT held a 38.5% interest under a loan commitment related to a retail development F-11 40 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) project in Florida. During the fourth quarter of 1999, ERT acquired the remaining 61.5% of Pointe Orlando (the joint venture partnership) and Pointe Orlando was consolidated with ERT. Inter-company balances have been eliminated in consolidation. Pointe Orlando has construction and land loans in the amount of $93.0 million, of which $84.0 million was outstanding at December 31, 1999 and $35.0 million is guaranteed by the Company. In addition, ERT also has an investment in a joint venture related to a retail development project in Texas. The Company has guaranteed $68.0 million of the loan on the project, which has an outstanding balance of $58.6 million and $32.8 million at December 31, 1999 and 1998, respectively. 7. MORTGAGES PAYABLE: Mortgages are collateralized by real estate and an assignment of rents. As of December 31, 1999, mortgages payable bear interest at rates ranging from 3.7% to 10.75%, having a weighted average of 7.8% per annum and maturity dates from 2000 to 2029. The principal payments required to be made on mortgages payable (excluding $9,921 of unamortized premium) are as follows (in thousands):
YEAR ---- 2000..................................................... $ 59,027 2001..................................................... 41,605 2002..................................................... 33,349 2003..................................................... 19,120 2004..................................................... 22,300 Thereafter............................................... 156,321 -------- $331,722 ========
8. CREDIT FACILITIES: The Company has two revolving credit facilities each of which provides up to $122.5 million in uncollateralized advances from a group of banks. One facility expires in November 2000 and bears an interest rate of 62.5 basis points over LIBOR. As of December 31, 1999, the interest rate on this facility was 7.125%. The other expires in November 2002 and bears an interest rate of 57.5 basis points over LIBOR. As of December 31, 1999, the interest rate on this facility was 7.075%. At December 31, 1999, the Company had $188.7 million outstanding under these facilities. The covenants of the credit facilities include maintaining certain ratios such as liabilities to assets of less than 50% and maintaining a minimum interest coverage of 2 to 1. F-12 41 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 9. NOTES PAYABLE (IN THOUSANDS):
FACE DECEMBER 31, DECEMBER 31, JULY 31, DESCRIPTION AMOUNT DUE DATE 1999 1998 1998 ----------- -------- -------- ------------ ------------ -------- 7.75% Senior notes, effective interest rate 7.95%, net of unamortized discount; December 31, 1999 and 1998 -- $806 and $957; respectively; July 31, 1998 -- $1,019............................. $100,000 2005 $ 99,194 $ 99,043 $ 98,981 6.80% Senior unsecured notes, effective interest rate 6.87%, net of unamortized discount; December 31, 1999 and 1998 -- $136 and $184; respectively; July 31, 1998 -- $192....................... 81,000 2002 80,864 80,816 80,808 6.875% Senior unsecured notes, effective interest rate 6.982%..... 75,000 2004 75,000 75,000 -- 7.97% unsecured notes................ 10,000 2026 10,000 10,000 10,000 Variable rate unsecured notes........ 49,000 -- -- 49,000 49,000 Variable rate unsecured notes........ 10,000 -- -- -- 10,000 5.95% unsecured notes................ 49,000 -- -- -- 49,000 7.65% unsecured notes................ 25,000 2026 25,000 25,000 25,000 7.68% unsecured notes................ 20,000 2026 20,000 20,000 20,000 Variable rate unsecured notes........ 40,000 2000 40,000 40,000 40,000 7.35% unsecured notes................ 30,000 2007 30,000 30,000 30,000 6.9% unsecured notes................. 50,000 2028 50,000 50,000 50,000 Variable rate unsecured notes........ 10,000 2000 10,000 10,376 -- 7.4% unsecured notes................. 150,000 2009 149,565 -- -- 7.5% unsecured notes................. 25,000 2029 24,113 -- -- 7.33% unsecured notes................ 49,000 2003 49,000 -- -- -------- -------- -------- Total...................... $662,736 $489,235 $462,789 ======== ======== ========
The Notes are uncollateralized and subordinate to mortgages payable and rank equally with debt under the revolving credit facilities. Where applicable, the discount is being amortized over the life of the respective Notes using the effective interest method. Interest is payable semi-annually or quarterly and the principal is due at maturity. Among other restrictive covenants, there is a restrictive covenant that limits the amount of total indebtedness to 65% of total assets. The principal payments (excluding $2,264 of unamortized discount) required to be made on notes payable are as follows (in thousands):
YEAR ---- 2000..................................................... $ 50,000 2001..................................................... -- 2002..................................................... 81,000 2003..................................................... 49,000 2004..................................................... 75,000 Thereafter............................................... 410,000 -------- $665,000 ========
F-13 42 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 10. CAPITAL LEASES: The Company owns a leasehold interest in three shopping centers in California ("Master Leased Centers"). The term of the leases are thirty-four years and the monthly lease payment is $201,000. In addition, the Company has purchased the option to acquire fee title to the Master Leased Centers, exercisable at various times during the terms of the respective leases. The owner of one of the Master Leased Centers has the option to require the Company to purchase the property after the occurrence of certain events. There are no principal payments due on the leases until a Master Leased Center is acquired. 11. OTHER LIABILITIES: Comprised of the following (in thousands):
DECEMBER 31, DECEMBER 31, JULY 31, 1999 1998 1998 ------------ ------------ -------- Property and other taxes payable................... $13,385 $11,839 $10,523 Interest payable................................... 11,965 8,771 9,712 Accounts payable................................... 6,935 5,442 3,362 Dividend payable................................... 41,599 36,482 -- Accrued construction costs......................... 1,936 4,521 4,789 Deferred rent expense and rents received in advance.......................................... 1,523 4,013 1,108 Amounts due seller of property..................... 1,365 1,823 1,952 Accrued professional and personnel costs........... 3,805 1,767 1,239 Acquisition costs.................................. 235 806 1,120 Other.............................................. 5,843 5,799 3,715 ------- ------- ------- Total.................................... $88,591 $81,263 $37,520 ======= ======= =======
12. ENVIRONMENTAL MATTERS: Under various federal, state and local laws, ordinances and regulations, the Company may be considered an owner or operator of real property or may have arranged for the disposal or treatment of hazardous or toxic substances and, therefore, may become liable for the costs of removal or remediation of certain hazardous substances released on or in its property or disposed of by it, as well as certain other potential costs which could relate to hazardous or toxic substances (including governmental fines and injuries to persons and property). Such liability may be imposed whether or not the Company knew of, or was responsible for, the presence of such hazardous or toxic substances. Except as discussed below, the Company is not aware of any significant environmental condition at any of its properties. Soil and groundwater contamination exists at certain of the Company's properties. The Company currently estimates that the total cumulative cost of remediation for these properties will be approximately $2.8 million to $6.5 million. In connection with certain of these properties, the Company has entered into remediation and indemnity agreements, which obligate the prior owners of certain of the properties (including in some cases, principals of the prior owners) to perform the remediation and to indemnify the Company for any losses the Company may suffer because of the contamination or remediation. Although there can be no assurance that the remediation estimates of the Company will prove accurate or that the prior owners will perform their obligations under the remediation and indemnity agreements, the Company does not expect the environmental conditions at these properties to have a material adverse effect on the Company. The Company has also identified asbestos minerals relating to spray-applied fireproofing materials at certain properties. Included in other liabilities in the Company's Consolidated Balance Sheet at December 31, 1999 is $3.2 million related to the clean-up of these asbestos minerals. F-14 43 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 13. LEASE AGREEMENTS: The Company has entered into leases, as lessee, in connection with ground leases for shopping centers which it operates, an office building which it sublets and administrative office space for the Company. These leases are accounted for as operating leases. The minimum annual rental commitments during the next five fiscal years and thereafter are approximately as follows (in thousands):
YEAR ---- 2000....................................................... $ 925 2001....................................................... 1,108 2002....................................................... 1,054 2003....................................................... 1,228 2004....................................................... 1,142 Thereafter................................................. 10,067 ------- $15,524 =======
For the year ended July 31, 1998, the lease for office space included contingent rentals for real estate tax escalations and operating expense in the amount of $10,000. There were no contingent rentals for the twelve months ended December 31, 1999, the five months ended December 31, 1998 or the year ended July 31, 1997. In addition, ground leases provide for fixed rent escalations and renewal options. 14. STOCKHOLDERS' EQUITY: Preferred Stock Holders of the 8 1/2% Series A Cumulative Convertible Preferred Stock (the "Preferred A Shares") are entitled to an annual distribution of $2.125 per share and are convertible into common shares at a price of $26.06 per share. The Preferred A Shares rank senior to the Company's common stock and are on a parity with the other preferred shares with respect to the payment of dividends and amounts payable upon liquidation, dissolution or winding down of the Company. The Company has outstanding 6,300,000 depositary shares each representing 1/10 of a share of 8 5/8% Series B Cumulative Redeemable Preferred Stock (the "Preferred B Shares"). Holders of the Preferred B Shares are entitled to an annual dividend equal to $2.15625, payable quarterly. The Company also has 1,500,000 depositary shares outstanding, each representing a 1/10 fractional interest in a share of 7.8% Series D Cumulative Voting Step-Up Premium Rate Preferred Stock (the "Preferred D Shares"), which are redeemable at the option of the Company on or after June 2007 at a liquidation preference of $500 per share. The Preferred D Shares pay dividends quarterly at the rate of 7.8% of the liquidation preference per annum through September 2012 and at the rate of 9.8% of the liquidation preference per annum thereafter. Options The Company has two active stock option plans (the "Plans") and five option plans under which grants are no longer made. Pursuant to the seven plans, options have been granted to purchase shares of common stock of the Company (the "Shares") to officers, directors, and certain key employees of the Company. The two active plans are: the 1993 Employee Plan (the "1993 Plan") and the 1994 Directors Plan (the "1994 Plan"). The exercise price of a share pursuant to each of the Plans is required to be no less than the fair market value of a share on the date of grant. The vesting schedule for the 1993 Plan is determined at the time of grant by the option committee and the grants under the 1994 Plan vest 100% at the grant date. As of December 31, 1999, approximately 1.7 million option shares are available for grant under the 1993 Plan. The F-15 44 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) total available for future grant is approximately 1.8 million option shares plus an aggregate amount equal to 2% of the total number of issued and outstanding shares of common stock as of December 31, 2000 and 2001. The total available for future grant under the 1994 Plan is approximately 177,000 option shares. The options outstanding at December 31, 1999, have exercise prices from $13.22 to $25.25 and have a weighted average remaining contractual life of 4.6 years. The total option shares under all seven plans exercisable at December 31, 1999 is approximately 3.1 million. Stock option and warrant activity are summarized as follows:
WEIGHTED AVERAGE EXERCISE PRICE OPTIONS PER SHARE ---------- ---------------- Outstanding at July 31, 1997............................. 2,513,200 Granted.................................................. 1,450,250 $24.08 Exercised or forfeited................................... (387,500) $21.97 ---------- Outstanding at July 31, 1998............................. 3,575,950 Balance from Excel at date of Merger..................... 2,315,842 $19.71 Granted.................................................. 135,500 $20.62 Exercised or forfeited................................... (81,402) $21.58 ---------- Outstanding December 31, 1998............................ 5,945,890 $20.83 Granted.................................................. 633,000 $19.92 Exercised or forfeited................................... (1,338,662) $17.27 ---------- Outstanding at December 31, 1999......................... 5,240,228 $21.62 ==========
SFAS No. 123, Accounting for Stock-Based Compensation, requires either the recording or disclosure of compensation cost for stock-based employee compensation plans at fair value. The Company has adopted the disclosure-only provisions of SFAS No. 123. Accordingly, no compensation costs have been recognized by the Company. Had compensation cost for the Company's stock option plans been recognized based on the fair value at the grant date for awards consistent with the provisions of SFAS No. 123, the Company's net income in the year ended December 31, 1999, net income would have been reduced by $1,160,000 from $149,513,000 to $148,353,000 ($1.42 per share -- basic and $1.40 per share -- diluted). In the five months ended December 31, 1998 would have been reduced by $677,000 from $55,805,000 ($0.63 per share -- basic and $0.62 per share -- diluted) to $55,128,000 ($0.62 per share -- basic and $0.61 per share -- diluted). In the year ended July 31, 1998, net income would have been reduced by $6,425,000, from $90,573,000 ($1.44 per share -- basic and $1.43 per share -- diluted) to $84,148,000 ($1.41 per share -- basic and diluted). In the year ended July 31, 1997, net income would have been reduced by $572,000, from $77,037,000 ($1.31 per share -- basic and $1.30 per share diluted) to $76,465,000 ($1.31 per share -- basic and $1.30 per share diluted). The fair value of each option grant is estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions used for grants in the five months ended December 31, 1998, and each of the three years ended December 31, 1999, July 31, 1998 and 1997, respectively: dividend yield of 6.70%, 8.74%, 6.14%, and 6.12%, respectively; expected volatility of 19.51%, 20.99%, 18.25%, and 19.30%, respectively; risk-free interest rate of 4.93%, 5.57%, 5.87%, and 6.66%, respectively; and expected life of 5.2 years, 4.6 years, 6.5 years and 6.3 years, respectively. The per share weighted average fair value at the dates of grant for options awarded for the above periods was $2.04, $1.47, $2.78, and $3.10, respectively. F-16 45 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) Dividend Reinvestment Plan The Company has a Dividend Reinvestment and Share Purchase Plan (the "Plan") whereby shareholders may invest cash distributions and make optional cash payments to purchase shares of the Company. The additional shares will be purchased in the open market. EARNINGS PER SHARE (EPS) In accordance with the disclosure requirements of SFAS No. 128 (Note 1), a reconciliation of the numerator and denominator of basic and diluted EPS is provided as follows (in thousands, except per share amounts):
YEAR ENDED YEAR ENDED FIVE MONTHS ENDED JULY 31, DECEMBER 31, DECEMBER 31, -------------------- 1999 1998 1998 1997 ------------ ------------------ ------- ---------- BASIC EPS Numerator: Net income....................... $149,513 $55,805 $90,573 $77,037 Preferred dividends.............. (22,777) (6,914) (5,850) (461) -------- ------- ------- ------- Net income available to common shares........................ $126,736 $48,891 $84,723 $76,576 ======== ======= ======= ======= Denominator: Weighted average of common shares outstanding................... 88,662 77,481 59,365 58,461 ======== ======= ======= ======= Earnings Per Share:................ $ 1.43 $ 0.63 $ 1.43 $ 1.31 ======== ======= ======= ======= DILUTED EPS Numerator: Net income....................... $149,513 $55,805 $90,573 $77,037 Preferred dividends.............. (22,777) (6,914) (5,850) (461) Minority interest................ 1,299 457 -- -- -------- ------- ------- ------- Net income available to common shares........................ $128,035 $49,348 $84,723 $76,576 ======== ======= ======= ======= Denominator: Weighted average of common shares outstanding................... 88,662 77,481 59,365 58,461 Effect of diluted securities: Common stock options and warrants...................... 22 594 409 274 ERP third party units............ 1,756 1,321 -- -- -------- ------- ------- ------- 90,440 79,396 59,774 58,735 ======== ======= ======= ======= Earnings Per Share:................ $ 1.42 $ 0.62 $ 1.42 $ 1.30 ======== ======= ======= ======= Preferred A shares are anti-dilutive for earnings per share calculations.
15. STATEMENT OF CASH FLOWS -- SUPPLEMENTAL DISCLOSURE: In the five months ended December 31, 1998 and the years ended December 31, 1999, July 31, 1998 and 1997, the Company acquired properties by assuming mortgages payable of $4,730,000, $5,357,000, $51,900,000, and $17,500,000, respectively. In addition, in connection with the purchase of a certain property F-17 46 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) in April 1999, the seller was issued partnership units in Excel Realty Partners, L.P. valued at $770,000. Moreover, in connection with the purchase of partnership units in Excel Realty Partners, L.P. in August 1999, $8.0 million in excess of minority interest has been included in real estate. The amounts paid for interest for the five months ended December 31, 1998 and the years ended December 31, 1999, July 31, 1998 and 1997 were $33,061,000, $84,163,000, $34,876,000, and $24,642,000, respectively. State and local income taxes paid for the five months ended December 31, 1998 and the years ended December 31, 1999, July 31, 1998, and 1997 were $100,000, $352,000, $156,000, and $872,000, respectively. The Company accrued $1,593,000 as of December 31, 1999 in order to repurchase the Company's common stock. 16. FINANCIAL INSTRUMENTS: The following fair value disclosure was determined by the Company, using available market information and discounted cash flow analyses as of December 31, 1999 and 1998, and July 31, 1998, respectively. The discount rate used in calculating fair value is the sum of the current risk free rate and the risk premium on the date of acquiring the instruments. Considerable judgement is necessary to interpret market data and to develop the related estimates of fair value. Accordingly, the estimates presented are not necessarily indicative of the amounts that the Company could realize upon disposition. The use of different estimation methodologies may have a material effect on the estimated fair value amounts. The Company believes that the carrying amounts reflected in the Consolidated Balance Sheets at December 31, 1999 and 1998 and July 31, 1998 approximate the fair values for cash and cash equivalents, marketable securities, receivables and other liabilities. The following are financial instruments for which Company estimates of fair value differ from carrying amounts (in thousands):
DECEMBER 31, 1999 DECEMBER 31, 1998 JULY 31, 1998 ------------------- ------------------- ------------------ CARRYING FAIR CARRYING FAIR CARRYING FAIR AMOUNTS VALUE AMOUNTS VALUE AMOUNTS VALUE -------- -------- -------- -------- -------- ------- Mortgages and notes receivable including advances to ERT..... $188,045 $189,737 $150,123 $150,324 $13,878 $14,100 Mortgages payable............... 341,643 342,757 388,185 398,572 114,099 115,700 Notes payable................... 662,736 691,501 489,235 539,876 462,789 501,800
17. FUTURE MINIMUM ANNUAL BASE RENTS: Future minimum annual base rental revenue for the next five years for the commercial real estate owned at December 31, 1999 and subject to noncancelable operating leases is as follows (in thousands):
YEAR ---- 2000..................................................... $266,676 2001..................................................... 239,438 2002..................................................... 210,712 2003..................................................... 187,305 2004..................................................... 162,767 Thereafter............................................... 52,978
The above table assumes that all leases which expire are not renewed and tenant renewal options are not exercised, therefore neither renewal rentals nor rentals from replacement tenants are included. Future minimum annual base rentals do not include contingent rentals, which may be received under certain leases on the basis of percentage of reported tenants' sales volume, increases in consumer price indices, common area maintenance charges and real estate tax reimbursements. Contingent rentals for the five months ended December 31, 1998 and for the years ended December 31, 1999, July 31, 1998 and 1997 amounted to approximately $15,549, $59,581, $34,421, and $28,933, respectively. F-18 47 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 18. RETIREMENT PLAN: The Company has a Retirement and 401(k) Savings Plan (the "Savings Plan") covering most of the officers and employees of the Company. Participants in the Savings Plan may elect to contribute a portion of their earnings to the Savings Plan and the Company makes a matching contribution to the Savings Plan to a maximum of 3% of the employee's eligible compensation. For the five months ended December 31, 1998 and the years ended December 31, 1999, July 31, 1998 and 1997, the Company's expense for the Savings Plan was $205,000, $607,000, $317,000 and $250,000, respectively. 19. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED): Summarized quarterly financial data is as follows (in thousands, except per share amounts):
NET INCOME NET INCOME TOTAL PER SHARE -- PER SHARE -- REVENUES NET INCOME BASIC DILUTED -------- ---------- ------------ ------------ YEAR ENDED DECEMBER 31, 1999: First quarter................................ $111,166 $39,669 $0.38 $0.38 Second quarter............................... 109,421 31,788(1) 0.29(1) 0.29(1) Third quarter................................ 108,167 34,688 0.33 0.32 Fourth quarter............................... 109,273 43,368 0.43 0.43 FIVE MONTHS ENDED DECEMBER 31, 1998: August 1 to September 30..................... $ 46,510 $16,937 $0.26 $0.26 October 1 to December 31..................... 109,411 38,868 0.37 0.36 YEAR ENDED JULY 31, 1998: First quarter................................ $ 59,507 $21,537 $0.34 $0.34 Second quarter............................... 61,845 22,525 0.36 0.35 Third quarter................................ 63,481 22,899 0.36 0.36 Fourth quarter............................... 65,426 23,612 0.37 0.37 YEAR ENDED JULY 31, 1997: First quarter................................ $ 47,783 $19,076 $0.33 $0.33 Second quarter............................... 51,147 19,092 0.33 0.32 Third quarter................................ 52,066 19,088 0.32 0.32 Fourth quarter............................... 55,825 19,781 0.33 0.33
- --------------- (1) Includes a non-recurring charge of $8.5 million 20. SEGMENT INFORMATION: The Company's two reportable business segments are retail and residential rental properties. At December 31, 1999, the retail segment consists of 303 shopping centers (included in this amount are 7 office and other properties) and the residential segment consists of 53 garden apartment complexes. Other includes interest income from ERT and development projects and other income. Also included is general and F-19 48 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) administrative expense, equity pick-up of ERT, interest expense, gains on sale of properties and a non-recurring charge. Selected financial information for each segment is as follows (in thousands):
RETAIL RESIDENTIAL OTHER TOTAL ---------- ----------- -------- ---------- FOR YEAR ENDED DECEMBER 31, 1999 Revenue......................................... $ 337,004 $ 77,477 $ 23,546 $ 438,027 Operating expenses and minority interest........ 92,021 43,664 16,461 152,146 Interest expense................................ 81,412 81,412 Depreciation.................................... 54,199 8,713 62,912 Gain/(loss) on sale of securities/properties.... 7,956 7,956 ---------- -------- -------- ---------- Net income/(loss)............................... $ 190,784 $ 25,100 $(66,371) $ 149,513 ========== ======== ======== ========== Real estate assets, net......................... $2,318,073 $346,298 $2,664,371 ========== ======== ========== FOR FIVE MONTHS ENDED DECEMBER 31, 1998 Revenue......................................... $ 122,505 $ 32,471 $ 945 $ 155,921 Operating expenses and minority interest........ 32,984 16,518 2,114 51,616 Interest Expense................................ 27,168 27,168 Depreciation and amortization................... 17,885 3,481 21,366 Gain/(loss) on sale of securities/properties.... 34 34 ---------- -------- -------- ---------- Net Income/(loss)............................... $ 71,636 $ 12,472 $(28,303) $ 55,805 ========== ======== ======== ========== Real Estate Assets, net......................... $2,318,001 $349,447 $2,667,448 ========== ======== ========== FOR YEAR ENDED JULY 31, 1998 Revenue......................................... $ 176,982 $ 69,326 $ 3,951 $ 250,259 Operating expenses and minority interest........ 52,184 36,216 2,808 91,208 Interest expense................................ 36,815 36,815 Depreciation.................................... 24,077 7,545 31,622 Gain/(loss) on sale of securities/properties.... (41) (41) ---------- -------- -------- ---------- Net income/(loss)............................... $ 100,721 $ 25,565 $(35,713) $ 90,573 ========== ======== ======== ========== Real estate assets, net......................... $ 977,617 $338,143 $1,315,760 ========== ======== ========== FOR YEAR ENDED JULY 31, 1997 Revenue......................................... $ 146,762 $ 55,331 $ 4,728 $ 206,821 Operating expenses and minority interest........ 45,163 29,153 2,203 76,519 Interest expense................................ 28,256 28,256 Depreciation.................................... 19,464 5,542 25,006 Gain/(loss) on sale of securities/properties.... (3) (3) ---------- -------- -------- ---------- Net income/(loss)............................... $ 82,135 $ 20,636 $(25,734) $ 77,037 ========== ======== ======== ========== Real estate assets, net......................... $ 875,027 $296,882 $1,171,909 ========== ======== ==========
21. MERGER: On September 28, 1998, New Plan Realty Trust ("Trust") and Excel Realty Trust ("Excel") merged. As provided in the Merger Agreement, Excel paid a 20% stock dividend prior to the Merger. In connection with the Merger, each share of beneficial interest, no par value, of the Trust was converted into one share of common stock, par value $.01 share, of the Company, and each 7.8% Series A Cumulative Step-Up Premium Rate Preferred Share, par value $.01 per share, of the Trust was converted into one share of 7.8% Series D Cumulative Voting Step-Up Premium Rate Preferred Stock, par value $.01 per share, of the Company ("Series D Preferred Stock"). The Company issued an aggregate of approximately 60,000,000 shares of common stock and 150,000 shares of Series D Preferred Stock (represented by 1,500,000 depositary shares, F-20 49 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) each of which represents a one-tenth fractional interest in a share of Series D Preferred Stock) to the Trust's shareholders in the Merger. The Merger has been accounted for as a purchase by the Trust of the assets and liabilities of Excel using the purchase method of accounting in the accompanying consolidated financial statements. This treatment was applied because the shareholders of the Trust immediately prior to the Merger owned approximately 65% of the Company's common stock outstanding immediately following the Merger, and the members of the Board of Trustees of the Trust immediately prior to the Merger comprised of nine of 15 members of the Board of Directors of the Company immediately following the Merger. As a result of the Merger, the Trust became a wholly owned subsidiary of the Company. The accompanying consolidated financial statements reflect the results of the Trust prior to the Merger and combined the results from September 28, 1998 to December 31, 1998. All information regarding per share information prior to the Merger has been restated to reflect the conversion of shares of beneficial interest in the Trust into common stock of the Company. The Trust valued the equity of the Company (assets net of liabilities) at $899,118,300, based upon the market value at the execution of the Merger Agreement of Trust shares of beneficial interest into which outstanding Excel shares of common stock could be converted. Additionally, the Company incurred costs of $6,400,000 related to the Merger. The total consideration for the fair value of the assets and liabilities acquired are set forth below: Consideration
SHARES VALUE TOTAL OUTSTANDING PER SHARE CONSIDERATION ----------- --------- ------------- Common stock..................................... 28,146,906 $24.20 $681,155,125 Series A preferred stock......................... 2,124,980 28.75 61,093,175 Series B preferred stock (depositary shares)..... 6,300,000 24.90 156,870,000 ------------ $899,118,300 ============
Assets and Liabilities Acquired Real estate................................................. $1,332,715,400 Other assets................................................ 136,864,400 Mortgages and notes payable................................. (501,400,600) Other liabilities........................................... (27,957,000) Minority interest........................................... (41,103,900) -------------- Allocation of purchase price................................ $ 899,118,300 ==============
22. NON-RECURRING CHARGE: In April 1999, seven executives, all formerly of Excel Realty Trust, Inc., resigned. These resignations occurred under the terms of Resignation and Release Agreements between the executives and New Plan Excel Realty Trust, Inc. They provided for payment by the Company of severance benefits, the cancellation of certain "in the money" vested stock options in exchange for the payment of the value of the stock options and the repurchase of Company stock owned by these executives. As a result, $8.5 million has been recorded as a non-recurring charge in 1999. This charge comprises $1.7 million in severance payments, $6.0 million in stock compensation expense and $0.8 million of other costs. F-21 50 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED) 23. SUBSEQUENT EVENTS: In February 2000, the Company expects to announce the appointment of Glenn J. Rufrano as Chief Executive Officer and President of the Company. Mr. Rufrano also will be nominated to serve on the Company's Board of Directors and be appointed to the Company's Investment Committee. Mr. Rufrano succeeds Arnold Laubich who will retire as both CEO and President. In connection with Mr. Laubich's retirement, the Company expects to record a one-time charge to net income of $0.03 per share. In connection with his employment, Mr. Rufrano will be granted options to purchase 700,000 shares of the Company's common stock, at an exercise price equivalent to the market price on the grant date. A total of 500,000 of these options vest ratably over five years, commencing on the first anniversary, while the remaining 200,000 vest upon the eighth anniversary of the grant, subject to acceleration at the end of the fourth and fifth years in the event certain performance objectives are achieved. Mr. Rufrano will also be granted options to purchase an additional 515,121 shares of the Company's common stock at an exercise price equivalent to the market price on the grant price, all of which options vest immediately upon Mr. Rufrano's employment with the Company. Mr. Rufrano expects to exercise these options. In connection with the exercise of these options, the Company expects to loan Mr. Rufrano $6.2 million. The loan will accrue interest at 8% per annum and will mature during February 2005 (or earlier under certain circumstances). A portion of the loan will be collateralized by a pledge of the shares Mr. Rufrano expects to acquire upon exercise of the option. In March 2000, the Company expects to establish a term loan facility with Fleet National Bank, pursuant to which the Company may draw down up to $75 million through April 27, 2000. Any loans drawn under this facility will mature on March 5, 2001 and will accrue interest at LIBOR plus 80 basis points (based on the Company's current credit rating). The term loan agreement prepared in connection with the facility will contain covenants substantially similar to those included in the Company's two revolving credit facilities with The Bank of New York. F-22 51 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE II -- VALUATION AND QUALIFYING ACCOUNTS (IN THOUSANDS)
ADDITIONS DEDUCTIONS ---------- ----------- BALANCES AT CHARGED TO ACCOUNTS BALANCE AT BEGINNING BAD DEBT RECEIVABLE END OF OF PERIOD EXPENSE WRITTEN OFF PERIOD ----------- ---------- ----------- ---------- Allowance for doubtful accounts: Year ended December 31, 1999.................... $11,636 $ 6,144 $3,883 $13,897 ======= ======== ====== ======= Five months ended December 31, 1998............. $ 7,926 $ 4,368(1) $ 658 $11,636 ======= ======== ====== ======= Year ended July 31, 1998........................ $ 5,581 $ 4,171 $1,826 $ 7,926 ======= ======== ====== ======= Year ended July 31, 1997........................ $ 3,977 $ 3,283 $1,679 $ 5,581 ======= ======== ====== =======
- --------------- (1) $1,543 of this amount was assumed as part of the Merger. F-23 52 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RESIDENTIAL Breckenridge Apartments Birmingham, AL.......................... 604,487 2,411,462 460,142 Courts At Wildwood Birmingham, AL.......................... 1,119,320 4,477,301 432,084 Devonshire Place Birmingham, AL.......................... 1,245,728 4,982,914 1,368,903 The Club Apartments Birmingham, AL.......................... 6,145,000 1,709,558 6,838,233 1,137,935 Hillcrest Apartments Mobile, AL.............................. 1,252,632 251,734 3,325,604 82,716 Knollwood Apartments Mobile, AL.............................. 6,026,518 4,352,001 16,926,403 214,938 Maison de Ville Apts Mobile, AL.............................. 4,625,000 1,971,014 7,897,056 418,102 Maison Imperial Apts Mobile, AL.............................. 1,750,000 672,368 2,702,471 137,081 Plantation Apartments Mobile, AL.............................. 1,000,000 410,866 1,653,465 79,638 Mayfair Apartments Dover, DE............................... 240,000 962,217 511,139 Rodney Apartments Dover, DE............................... 769,188 1,612,614 1,313,333 Charter Pointe Apartments Altamonte Springs, FL................... 5,153,395 1,473,146 9,049,327 196,973 Lake Park Apartments Lake Park, FL........................... 833,000 1,822,039 2,738,737 Cambridge Apartments Athens, GA.............................. 878,593 3,514,373 120,704 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RESIDENTIAL Breckenridge Apartments Birmingham, AL.......................... 604,487 2,871,604 3,476,091 565,957 1979 Feb 92 Courts At Wildwood Birmingham, AL.......................... 1,119,320 4,909,385 6,028,705 858,937 1969 Jul 93 Devonshire Place Birmingham, AL.......................... 1,245,728 6,351,817 7,597,545 1,306,764 1971 Feb 92 The Club Apartments Birmingham, AL.......................... 1,709,558 7,976,168 9,685,726 905,642 1969-1974 May 95 Hillcrest Apartments Mobile, AL.............................. 251,734 3,408,320 3,660,054 217,541 1977 Jun 97 Knollwood Apartments Mobile, AL.............................. 4,352,001 17,141,341 21,493,342 1,115,101 1978-1982 May 97 Maison de Ville Apts Mobile, AL.............................. 1,971,014 8,315,158 10,286,172 720,232 1963,71-73 Jul 96 Maison Imperial Apts Mobile, AL.............................. 672,368 2,839,552 3,511,920 247,790 1969-73 Jul 96 Plantation Apartments Mobile, AL.............................. 410,866 1,733,103 2,143,969 156,544 1977 Jul 96 Mayfair Apartments Dover, DE............................... 240,000 1,473,356 1,713,356 805,402 1971 Jan 81 Rodney Apartments Dover, DE............................... 769,188 2,925,947 3,695,135 2,448,384 1963-1965 Jan 69 Charter Pointe Apartments Altamonte Springs, FL................... 1,473,146 9,246,300 10,719,446 404,862 1973 Apr 98 Lake Park Apartments Lake Park, FL........................... 833,000 4,560,776 5,393,776 2,633,997 1965 Feb 76 Cambridge Apartments Athens, GA.............................. 878,593 3,635,077 4,513,670 345,378 1972,1982 May 96 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RESIDENTIAL Breckenridge Apartments Birmingham, AL.......................... 40 Years Courts At Wildwood Birmingham, AL.......................... 40 Years Devonshire Place Birmingham, AL.......................... 40 Years The Club Apartments Birmingham, AL.......................... 40 Years Hillcrest Apartments Mobile, AL.............................. 40 Years Knollwood Apartments Mobile, AL.............................. 40 Years Maison de Ville Apts Mobile, AL.............................. 40 Years Maison Imperial Apts Mobile, AL.............................. 40 Years Plantation Apartments Mobile, AL.............................. 40 Years Mayfair Apartments Dover, DE............................... 40 Years Rodney Apartments Dover, DE............................... 40 Years Charter Pointe Apartments Altamonte Springs, FL................... 40 Years Lake Park Apartments Lake Park, FL........................... 40 Years Cambridge Apartments Athens, GA.............................. 40 Years
F-24 53 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RESIDENTIAL Tara Apartments Athens, GA.............................. 3,269,724 1,192,545 4,792,179 222,642 Regency Club Apartments Evansville, IN.......................... 1,179,910 4,719,639 260,553 Forest Hills Apartments Indianapolis, IN........................ 714,761 8,197,499 243,069 Hawthorne Heights Apts Indianapolis, IN........................ 1,669,304 6,698,215 319,026 Charlestown @ Douglass Hills Louisville, KY.......................... 1,306,230 5,231,914 997,045 La Fontenay Apartments Louisville, KY.......................... 1,176,550 4,706,200 1,646,905 Poplar Level Apartments Louisville, KY.......................... 284,793 1,139,174 131,765 Riverchase Apartments Newport, KY............................. 807,302 3,229,206 203,735 Forestwood Apartments Baton Rouge, LA......................... 2,070,811 8,283,242 364,014 Sherwood Acres Apartments Baton Rouge, LA......................... 3,906,900 15,627,597 224,674 Willow Bend Lake Apartments Baton Rouge, LA......................... 2,930,484 11,721,937 195,475 Deerhorn Village Apartments Kansas City, MO......................... 1,292,778 5,171,112 742,546 Cardinal Woods Apartments Cary, NC................................ 1,435,783 5,726,132 240,340 Polo Run Apartments Raleigh, NC............................. 4,502,052 4,331,230 8,413,395 363,760 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RESIDENTIAL Tara Apartments Athens, GA.............................. 1,192,545 5,014,821 6,207,366 464,471 1970 Jun 96 Regency Club Apartments Evansville, IN.......................... 1,179,910 4,980,192 6,160,102 414,940 1980 Sep 96 Forest Hills Apartments Indianapolis, IN........................ 714,761 8,440,568 9,155,329 475,796 1974 Oct 97 Hawthorne Heights Apts Indianapolis, IN........................ 1,669,304 7,017,241 8,686,545 643,026 1965 Jun 96 Charlestown @ Douglass Hills Louisville, KY.......................... 1,306,230 6,228,959 7,535,189 951,569 1974 Sep 93 La Fontenay Apartments Louisville, KY.......................... 1,176,550 6,353,105 7,529,655 1,146,810 1970 Jul 92 Poplar Level Apartments Louisville, KY.......................... 284,793 1,270,939 1,555,732 308,746 1974 Jan 91 Riverchase Apartments Newport, KY............................. 807,302 3,432,941 4,240,243 287,148 1968 Aug 96 Forestwood Apartments Baton Rouge, LA......................... 2,070,811 8,647,256 10,718,067 668,763 1985 Oct 96 Sherwood Acres Apartments Baton Rouge, LA......................... 3,906,900 15,852,271 19,759,171 1,259,095 1978-1979 Oct 96 Willow Bend Lake Apartments Baton Rouge, LA......................... 2,930,484 11,917,412 14,847,896 917,596 1986 Oct 96 Deerhorn Village Apartments Kansas City, MO......................... 1,292,778 5,913,658 7,206,436 684,471 1974 Jul 95 Cardinal Woods Apartments Cary, NC................................ 1,435,783 5,966,472 7,402,255 336,415 1978 Aug 97 Polo Run Apartments Raleigh, NC............................. 4,331,230 8,777,155 13,108,385 279,462 1971 Aug 98 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RESIDENTIAL Tara Apartments Athens, GA.............................. 40 Years Regency Club Apartments Evansville, IN.......................... 40 Years Forest Hills Apartments Indianapolis, IN........................ 40 Years Hawthorne Heights Apts Indianapolis, IN........................ 40 Years Charlestown @ Douglass Hills Louisville, KY.......................... 40 Years La Fontenay Apartments Louisville, KY.......................... 40 Years Poplar Level Apartments Louisville, KY.......................... 40 Years Riverchase Apartments Newport, KY............................. 40 Years Forestwood Apartments Baton Rouge, LA......................... 40 Years Sherwood Acres Apartments Baton Rouge, LA......................... 40 Years Willow Bend Lake Apartments Baton Rouge, LA......................... 40 Years Deerhorn Village Apartments Kansas City, MO......................... 40 Years Cardinal Woods Apartments Cary, NC................................ 40 Years Polo Run Apartments Raleigh, NC............................. 40 Years
F-25 54 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RESIDENTIAL Meadow East Apartments Potsdam, NY............................. 86,407 1,467,282 526,179 Mohawk Garden Apartments Rome, NY................................ 163,235 1,135,660 1,716,786 Northgate Apartments Columbus, OH............................ 7,215,717 1,513,498 9,297,201 1,661,245 Spring Creek Apartments Columbus, OH............................ 1,455,271 9,082,352 107,576 Arlington Village Apartments Fairborn, OH............................ 1,065,284 4,269,138 213,382 Chesterfield Apartments Maumee, OH.............................. 179,109 1,449,156 438,665 Eastgreen on the Commons Apartments Reynoldsburg, OH........................ 5,783,267 1,142,888 7,648,557 1,589,445 Goldcrest Apartments Sharonville, OH......................... 1,133,355 4,533,416 154,691 Cambridge Park Apts Union Twp-Cinn, OH...................... 1,223,582 4,894,326 192,078 Governour's Place Apartments Harrisburg, PA.......................... 626,807 2,507,226 427,225 Forest Hill Apartments -- II Columbia, SC............................ 1,204,688 3,257,121 153,510 Harbour Landing Apartments Columbia, SC............................ 1,141,954 4,567,815 295,446 Sedgefield Apartments Florence, SC............................ 1,550,734 6,211,936 439,725 Turtle Creek Apartments Greenville, SC.......................... 984,565 3,954,261 549,700 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RESIDENTIAL Meadow East Apartments Potsdam, NY............................. 86,407 1,993,461 2,079,868 820,779 1964-1971 Sep 83 Mohawk Garden Apartments Rome, NY................................ 163,235 2,852,446 3,015,681 1,380,603 1947 Nov 85 Northgate Apartments Columbus, OH............................ 1,513,498 10,958,446 12,471,944 374,638 1970 Jul 98 Spring Creek Apartments Columbus, OH............................ 1,455,271 9,189,928 10,645,199 574,976 1985 Jun 97 Arlington Village Apartments Fairborn, OH............................ 1,065,284 4,482,520 5,547,804 633,173 1966 Aug 94 Chesterfield Apartments Maumee, OH.............................. 179,109 1,887,821 2,066,930 417,079 1979-1984 Feb 91 Eastgreen on the Commons Apartments Reynoldsburg, OH........................ 1,142,888 9,238,002 10,380,890 393,867 1971,1982 Jan 98 Goldcrest Apartments Sharonville, OH......................... 1,133,355 4,688,107 5,821,462 394,271 1968 Aug 96 Cambridge Park Apts Union Twp-Cinn, OH...................... 1,223,582 5,086,404 6,309,986 427,313 1973 Aug 96 Governour's Place Apartments Harrisburg, PA.......................... 626,807 2,934,451 3,561,258 329,234 1974 Apr 95 Forest Hill Apartments -- II Columbia, SC............................ 1,204,688 3,410,631 4,615,319 64,996 1968 Jan 99 Harbour Landing Apartments Columbia, SC............................ 1,141,954 4,863,261 6,005,215 548,466 1974 Sep 95 Sedgefield Apartments Florence, SC............................ 1,550,734 6,651,661 8,202,395 938,911 1972,74,79 Jul 94 Turtle Creek Apartments Greenville, SC.......................... 984,565 4,503,961 5,488,526 369,724 1976 Jun 96 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RESIDENTIAL Meadow East Apartments Potsdam, NY............................. 40 Years Mohawk Garden Apartments Rome, NY................................ 40 Years Northgate Apartments Columbus, OH............................ 40 Years Spring Creek Apartments Columbus, OH............................ 40 Years Arlington Village Apartments Fairborn, OH............................ 40 Years Chesterfield Apartments Maumee, OH.............................. 40 Years Eastgreen on the Commons Apartments Reynoldsburg, OH........................ 40 Years Goldcrest Apartments Sharonville, OH......................... 40 Years Cambridge Park Apts Union Twp-Cinn, OH...................... 40 Years Governour's Place Apartments Harrisburg, PA.......................... 40 Years Forest Hill Apartments -- II Columbia, SC............................ 40 Years Harbour Landing Apartments Columbia, SC............................ 40 Years Sedgefield Apartments Florence, SC............................ 40 Years Turtle Creek Apartments Greenville, SC.......................... 40 Years
F-26 55 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RESIDENTIAL Hickory Lake Apartments Antioch, TN............................. 1,369,251 5,483,004 2,012,113 Courts @ Waterford Place Chattanooga, TN......................... 9,600,000 2,745,404 10,982,373 292,073 Ashford Place Apartments Clarksville, TN......................... 1,150,270 4,611,080 2,475,138 Cedar Village Apartments Clarksville, TN......................... 806,355 3,230,420 198,991 Paddock Place Apartments Clarksville, TN......................... 1,358,400 5,437,602 137,681 The Pines Apartments Clarksville, TN......................... 918,769 3,679,074 177,930 Landmark Estates Apartments East Ridge, TN.......................... 476,624 1,906,284 210,033 Miller Crest Apartments Johnson City, TN........................ 747,155 3,025,619 188,987 Cedar Bluff Apartments Knoxville, TN........................... 1,273,023 5,269,532 229,467 Country Place Apartments Nashville, TN........................... 1,896,828 7,587,313 207,897 Woodbridge Apartmentse Nashville, TN........................... 1,594,214 6,376,854 193,119 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RESIDENTIAL Hickory Lake Apartments Antioch, TN............................. 1,369,251 7,495,117 8,864,368 1,066,482 1974 Dec 93 Courts @ Waterford Place Chattanooga, TN......................... 2,745,404 11,274,446 14,019,850 883,939 1988,89 Dec 96 Ashford Place Apartments Clarksville, TN......................... 1,150,270 7,086,218 8,236,488 908,176 1972,1974 Oct 93 Cedar Village Apartments Clarksville, TN......................... 806,355 3,429,411 4,235,766 491,518 1982 Jul 94 Paddock Place Apartments Clarksville, TN......................... 1,358,400 5,575,283 6,933,683 774,967 1989 Jul 94 The Pines Apartments Clarksville, TN......................... 918,769 3,857,004 4,775,773 548,238 1986 Jul 94 Landmark Estates Apartments East Ridge, TN.......................... 476,624 2,116,317 2,592,941 190,219 1971 Aug 96 Miller Crest Apartments Johnson City, TN........................ 747,155 3,214,606 3,961,761 294,069 1973 Jun 96 Cedar Bluff Apartments Knoxville, TN........................... 1,273,023 5,498,999 6,772,022 506,437 1980 May 96 Country Place Apartments Nashville, TN........................... 1,896,828 7,795,210 9,692,038 745,248 1979 Apr 96 Woodbridge Apartmentse Nashville, TN........................... 1,594,214 6,569,973 8,164,187 546,295 1980 Aug 96 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RESIDENTIAL Hickory Lake Apartments Antioch, TN............................. 40 Years Courts @ Waterford Place Chattanooga, TN......................... 40 Years Ashford Place Apartments Clarksville, TN......................... 40 Years Cedar Village Apartments Clarksville, TN......................... 40 Years Paddock Place Apartments Clarksville, TN......................... 40 Years The Pines Apartments Clarksville, TN......................... 40 Years Landmark Estates Apartments East Ridge, TN.......................... 40 Years Miller Crest Apartments Johnson City, TN........................ 40 Years Cedar Bluff Apartments Knoxville, TN........................... 40 Years Country Place Apartments Nashville, TN........................... 40 Years Woodbridge Apartmentse Nashville, TN........................... 40 Years
F-27 56 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Cloverdale Village Florence, AL............................ 634,152 2,536,606 7,304 Riverview Plaza Gadsden, AL............................. 5,722,800 2,072,169 8,286,847 Grants Mill Station Irondale, AL............................ 7,960,394 2,888,819 11,555,308 103,935 Jitney/Sak n Save Muscle Shoals, AL....................... 429,999 1,720,097 Kroger/Handy TV Muscle Shoals, AL....................... 102,822 411,047 Bruno's/Food World Scottsboro, AL.......................... 369,815 1,479,269 Payton Park Sylacauga, AL........................... 3,584,697 14,339,021 Kmart #6734/Country Mrkt Pine Bluff, AR.......................... 490,287 1,961,357 Harvest Foods #274 Sherwood, AR............................ 409,418 1,637,511 Glendale Galleria Glendale, AZ............................ 2,869,504 11,478,248 23,023 Abco #693 Mesa, AZ................................ 243,862 975,664 KMART Plaza-Mesa Mesa, AZ................................ 1,147,194 4,588,778 Southern Village Mesa Mesa, AZ................................ 1,712,353 6,849,509 31,291 Sun Valley Plaza Mesa, AZ................................ 1,188,094 4,752,619 4,876 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Cloverdale Village Florence, AL............................ 634,152 2,543,910 3,178,062 332,089 1986 Oct 94 Riverview Plaza Gadsden, AL............................. 2,072,169 8,286,847 10,359,016 244,391 1995 Oct 95 Grants Mill Station Irondale, AL............................ 2,888,819 11,659,243 14,548,062 350,127 1991 Jul 98 Jitney/Sak n Save Muscle Shoals, AL....................... 429,999 1,720,097 2,150,096 52,804 1982 Aug 93 Kroger/Handy TV Muscle Shoals, AL....................... 102,822 411,047 513,869 12,620 1982 Aug 93 Bruno's/Food World Scottsboro, AL.......................... 369,815 1,479,269 1,849,084 45,411 1981 Aug 93 Payton Park Sylacauga, AL........................... 3,584,697 14,339,021 17,923,718 432,300 1995 Jul 98 Kmart #6734/Country Mrkt Pine Bluff, AR.......................... 490,287 1,961,357 2,451,644 60,210 1981 Aug 93 Harvest Foods #274 Sherwood, AR............................ 409,418 1,637,511 2,046,929 50,270 1981 Aug 93 Glendale Galleria Glendale, AZ............................ 2,869,504 11,501,271 14,370,775 354,519 1989-91 Aug 97 Abco #693 Mesa, AZ................................ 243,862 975,664 1,219,526 29,950 1982 Aug 93 KMART Plaza-Mesa Mesa, AZ................................ 1,147,194 4,588,778 5,735,972 144,024 1970 Dec 90 Southern Village Mesa Mesa, AZ................................ 1,712,353 6,880,800 8,593,153 212,333 1986,97 Aug 97 Sun Valley Plaza Mesa, AZ................................ 1,188,094 4,757,495 5,945,589 144,096 1981 May 94 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Cloverdale Village Florence, AL............................ 40 Years Riverview Plaza Gadsden, AL............................. 40 Years Grants Mill Station Irondale, AL............................ 40 Years Jitney/Sak n Save Muscle Shoals, AL....................... 40 Years Kroger/Handy TV Muscle Shoals, AL....................... 40 Years Bruno's/Food World Scottsboro, AL.......................... 40 Years Payton Park Sylacauga, AL........................... 40 Years Kmart #6734/Country Mrkt Pine Bluff, AR.......................... 40 Years Harvest Foods #274 Sherwood, AR............................ 40 Years Glendale Galleria Glendale, AZ............................ 40 Years Abco #693 Mesa, AZ................................ 40 Years KMART Plaza-Mesa Mesa, AZ................................ 40 Years Southern Village Mesa Mesa, AZ................................ 40 Years Sun Valley Plaza Mesa, AZ................................ 40 Years
F-28 57 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Metro Marketplace Phoenix, AZ............................. 5,098,702 20,521,995 Q Club #307505 Phoenix, AZ............................. 1,830,245 7,320,951 Southwest Spr Mkt (ABCO #690) Phoenix, AZ............................. 298,236 1,193,113 Genzyme Scottsdale, AZ.......................... 491,910 1,967,516 Q Club #307506 Scottsdale, AZ.......................... 1,843,664 7,374,597 Northmall Centre Tucson, AZ.............................. 4,762,481 12,630,121 84,252 Payless Drug #06182 Yuma, AZ................................ 192,303 769,278 Bakersfield Plaza Bakersfield, CA......................... 14,147,746 5,300,678 21,201,141 Factory Merchants Barstow Barstow, CA............................. 9,058,554 5,730,337 22,936,349 13,044,417 Kinko's/Sony Burbank, CA............................. 1,153,334 4,613,209 112,211 Carmen Plaza Camarillo, CA........................... 1,872,708 7,491,044 3,872 Coachella Plaza Coachella, CA........................... 263,529 1,054,118 9,281 Cudahy Plaza Cudahy, CA.............................. 4,694,990 1,924,146 7,695,933 17,586 Arbor Faire Fresno, CA.............................. 4,378,813 17,624,497 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Metro Marketplace Phoenix, AZ............................. 5,098,702 20,521,995 25,620,697 614,880 1988 Jun 91 Q Club #307505 Phoenix, AZ............................. 1,830,245 7,320,951 9,151,196 224,743 1994 May 94 Southwest Spr Mkt (ABCO #690) Phoenix, AZ............................. 298,236 1,193,113 1,491,349 36,626 1982 Jan 94 Genzyme Scottsdale, AZ.......................... 491,910 1,967,516 2,459,426 60,401 1971 Dec 90 Q Club #307506 Scottsdale, AZ.......................... 1,843,664 7,374,597 9,218,261 226,390 1994 Aug 94 Northmall Centre Tucson, AZ.............................. 4,762,481 12,714,373 17,476,854 382,887 1995-96 Dec 96 Payless Drug #06182 Yuma, AZ................................ 192,303 769,278 961,581 23,615 1980 Aug 93 Bakersfield Plaza Bakersfield, CA......................... 5,300,678 21,201,141 26,501,819 625,256 1970 Jun 97 Factory Merchants Barstow Barstow, CA............................. 5,730,337 35,980,766 41,711,103 5,973,004 1989 Nov 93 Kinko's/Sony Burbank, CA............................. 1,153,334 4,725,420 5,878,754 150,304 1988 May 89 Carmen Plaza Camarillo, CA........................... 1,872,708 7,494,916 9,367,624 225,843 1971 Jun 97 Coachella Plaza Coachella, CA........................... 263,529 1,063,399 1,326,928 33,485 1991 Jun 97 Cudahy Plaza Cudahy, CA.............................. 1,924,146 7,713,519 9,637,665 228,362 1968 Jun 97 Arbor Faire Fresno, CA.............................. 4,378,813 17,624,497 22,003,310 525,376 1993 Apr 97 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Metro Marketplace Phoenix, AZ............................. 40 Years Q Club #307505 Phoenix, AZ............................. 40 Years Southwest Spr Mkt (ABCO #690) Phoenix, AZ............................. 40 Years Genzyme Scottsdale, AZ.......................... 40 Years Q Club #307506 Scottsdale, AZ.......................... 40 Years Northmall Centre Tucson, AZ.............................. 40 Years Payless Drug #06182 Yuma, AZ................................ 40 Years Bakersfield Plaza Bakersfield, CA......................... 40 Years Factory Merchants Barstow Barstow, CA............................. 40 Years Kinko's/Sony Burbank, CA............................. 40 Years Carmen Plaza Camarillo, CA........................... 40 Years Coachella Plaza Coachella, CA........................... 40 Years Cudahy Plaza Cudahy, CA.............................. 40 Years Arbor Faire Fresno, CA.............................. 40 Years
F-29 58 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - --------------------------------------- ------------- ------------------------- ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------- ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- ---------- ------------ ---------------- RETAIL Broadway Faire Fresno, CA............................ 2,795,383 11,181,648 Briggsmore Plaza Modesto, CA........................... 1,139,298 1,663,885 6,653,828 Montebello Plaza Montebello, CA........................ 8,889,848 5,801,166 23,202,411 2,001 Paradise Plaza Paradise, CA.......................... 2,777,053 1,709,966 6,840,631 Metro 580 Pleasanton, CA........................ 5,876,389 23,651,921 Rose Pavilion Pleasanton, CA........................ 11,355,146 45,703,524 Via del Campo Office Bldg San Diego, CA......................... 497,018 1,988,071 San Dimas Plaza San Dimas, CA......................... 7,463,496 4,435,649 17,744,585 Bristol Plaza Santa Ana, CA......................... 8,508,228 2,934,989 11,611,340 127,380 Vail Ranch Center Temecula, CA.......................... 2,630,621 10,522,619 United Artists Theatre #30016 Pueblo, CO............................ 141,221 564,854 Westminster City Centre Westminster, CO....................... 29,586,845 12,256,884 49,332,701 25,982 Doverama @ Rodney Village Dover, DE............................. 50,755 311,781 Rodney Village Dover, DE............................. 1,202,551 2,082,918 2,561,046 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - --------------------------------------- -------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD -------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- ---------- ------------ ---------- ------------ ------------ -------- RETAIL Broadway Faire Fresno, CA............................ 2,795,383 11,181,648 13,977,031 337,110 1993 Apr 97 Briggsmore Plaza Modesto, CA........................... 1,663,885 6,653,828 8,317,713 196,236 1974 Jun 97 Montebello Plaza Montebello, CA........................ 5,801,166 23,204,412 29,005,578 685,036 1974 Jun 97 Paradise Plaza Paradise, CA.......................... 1,709,966 6,840,631 8,550,597 202,632 1979 Jun 97 Metro 580 Pleasanton, CA........................ 5,876,389 23,651,921 29,528,310 708,660 1995-96 Sep 97 Rose Pavilion Pleasanton, CA........................ 11,355,146 45,703,524 57,058,670 1,369,371 1987 Feb 98 Via del Campo Office Bldg San Diego, CA......................... 497,018 1,988,071 2,485,089 62,398 1988 Jan 94 San Dimas Plaza San Dimas, CA......................... 4,435,649 17,744,585 22,180,234 523,308 1986-88 Oct 97 Bristol Plaza Santa Ana, CA......................... 2,934,989 11,738,720 14,673,709 346,581 1972 Jun 97 Vail Ranch Center Temecula, CA.......................... 2,630,621 10,522,619 13,153,240 317,241 1997 Dec 97 United Artists Theatre #30016 Pueblo, CO............................ 141,221 564,854 706,075 17,340 1977 Dec 92 Westminster City Centre Westminster, CO....................... 12,256,884 49,358,683 61,615,567 1,478,489 1996 Dec 97 Doverama @ Rodney Village Dover, DE............................. 50,755 311,781 362,536 86,742 1969 Oct 88 Rodney Village Dover, DE............................. 1,202,551 4,643,964 5,846,515 3,455,467 1959 Jan 69 COLUMN A COLUMN I - --------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Broadway Faire Fresno, CA............................ 40 Years Briggsmore Plaza Modesto, CA........................... 40 Years Montebello Plaza Montebello, CA........................ 40 Years Paradise Plaza Paradise, CA.......................... 40 Years Metro 580 Pleasanton, CA........................ 40 Years Rose Pavilion Pleasanton, CA........................ 40 Years Via del Campo Office Bldg San Diego, CA......................... 40 Years San Dimas Plaza San Dimas, CA......................... 40 Years Bristol Plaza Santa Ana, CA......................... 40 Years Vail Ranch Center Temecula, CA.......................... 40 Years United Artists Theatre #30016 Pueblo, CO............................ 40 Years Westminster City Centre Westminster, CO....................... 40 Years Doverama @ Rodney Village Dover, DE............................. 40 Years Rodney Village Dover, DE............................. 40 Years
F-30 59 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Gold's/Kash n Karry 869/Food Lion Brandon, FL............................. 390,830 1,563,125 Brooksville Square Brooksville, FL......................... 1,373,719 5,494,698 Kmart #7513 Brooksville, FL......................... 1,346,436 5,385,720 Clearwater Mall Clearwater, FL.......................... 4,662,276 18,646,102 468,857 Northgate Shopping Center Deland, FL.............................. 8,458,324 2,957,640 11,830,664 11,410 Regency Park Shopping Center Jacksonville, FL........................ 3,888,425 15,553,501 71,259 Eastgate Shopping Center-Lake Wales Lake Wales, FL.......................... 1,542,842 6,171,549 Leesburg Square Leesburg, FL............................ 1,051,639 4,206,554 16,464 Miami Gardens Miami, FL............................... 5,490,459 22,098,501 40,560 Freedom Square Naples, FL.............................. 3,340,254 13,361,048 Southgate Shopping Center New Port Richie, FL..................... 4,253,341 3,981,290 41,810 Presidential Plaza North Lauderdale, FL.................... 1,312,956 2,456,917 153,033 Presidential Plaza West North Lauderdale, FL.................... 437,485 812,473 13,147 Colonial Marketplace Orlando, FL............................. 4,049,702 2,524,647 3,504,446 6,047 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Gold's/Kash n Karry 869/Food Lion Brandon, FL............................. 390,830 1,563,125 1,953,955 47,987 1982 Aug 93 Brooksville Square Brooksville, FL......................... 1,373,719 5,494,698 6,868,417 165,658 1987 Mar 94 Kmart #7513 Brooksville, FL......................... 1,346,436 5,385,720 6,732,156 165,334 1987 Jun 97 Clearwater Mall Clearwater, FL.......................... 4,662,276 19,114,959 23,777,235 1,303,175 1973 Dec 97 Northgate Shopping Center Deland, FL.............................. 2,957,640 11,842,074 14,799,714 359,830 1993 Jun 93 Regency Park Shopping Center Jacksonville, FL........................ 3,888,425 15,624,760 19,513,185 978,672 1985 Jun 97 Eastgate Shopping Center-Lake Wales Lake Wales, FL.......................... 1,542,842 6,171,549 7,714,391 186,062 1994 May 94 Leesburg Square Leesburg, FL............................ 1,051,639 4,223,018 5,274,657 132,353 1986 Dec 92 Miami Gardens Miami, FL............................... 5,490,459 22,139,061 27,629,520 662,920 1996 Oct 97 Freedom Square Naples, FL.............................. 3,340,254 13,361,048 16,701,302 402,817 1995 Oct 97 Southgate Shopping Center New Port Richie, FL..................... 4,253,341 4,023,100 8,276,441 223,431 1966 Aug 97 Presidential Plaza North Lauderdale, FL.................... 1,312,956 2,609,950 3,922,906 174,899 1977 Apr 97 Presidential Plaza West North Lauderdale, FL.................... 437,485 825,620 1,263,105 55,638 1977 Apr 97 Colonial Marketplace Orlando, FL............................. 2,524,647 3,510,493 6,035,140 149,669 1979,86 Apr 98 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Gold's/Kash n Karry 869/Food Lion Brandon, FL............................. 40 Years Brooksville Square Brooksville, FL......................... 40 Years Kmart #7513 Brooksville, FL......................... 40 Years Clearwater Mall Clearwater, FL.......................... 40 Years Northgate Shopping Center Deland, FL.............................. 40 Years Regency Park Shopping Center Jacksonville, FL........................ 40 Years Eastgate Shopping Center-Lake Wales Lake Wales, FL.......................... 40 Years Leesburg Square Leesburg, FL............................ 40 Years Miami Gardens Miami, FL............................... 40 Years Freedom Square Naples, FL.............................. 40 Years Southgate Shopping Center New Port Richie, FL..................... 40 Years Presidential Plaza North Lauderdale, FL.................... 40 Years Presidential Plaza West North Lauderdale, FL.................... 40 Years Colonial Marketplace Orlando, FL............................. 40 Years
F-31 60 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL 23rd Street Station Panama City, FL......................... 1,849,668 7,398,843 42,014 Riverwood Shopping Center Port Orange, FL......................... 2,243,023 1,500,580 34,620 Seminole Plaza Seminole, FL............................ 2,128,480 2,215,356 307,982 St Augustine Outlet Center St Augustine, FL........................ 4,488,742 14,426,139 10,318,921 Rutland Plaza St Petersburg, FL....................... 1,443,294 5,773,175 127,869 Albany I Albany, GA.............................. 470,300 1,881,213 Albany Plaza Albany, GA.............................. 696,447 2,799,786 148,167 Southgate Plaza -- Albany Albany, GA.............................. 231,517 970,811 107,751 Eastgate Plaza -- Americus Americus, GA............................ 221,637 1,036,331 108,166 Perlis Plaza Americus, GA............................ 774,966 5,301,644 562,817 Rogers Plaza Ashburn, GA............................. 291,014 688,590 110,593 Sweetwater Village Austell, GA............................. 707,938 2,831,750 28,764 Cedar Plaza Cedartown, GA........................... 928,302 3,713,207 50,395 Cedartown Shopping Center Cedartown, GA........................... 745,006 3,266,424 84,289 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL 23rd Street Station Panama City, FL......................... 1,849,668 7,440,857 9,290,525 229,687 1986 Jul 98 Riverwood Shopping Center Port Orange, FL......................... 2,243,023 1,535,200 3,778,223 86,441 1984,1996 Sep 97 Seminole Plaza Seminole, FL............................ 2,128,480 2,523,338 4,651,818 103,530 1964 Jun 98 St Augustine Outlet Center St Augustine, FL........................ 4,488,742 24,745,060 29,233,802 5,251,716 1991 Mar 92 Rutland Plaza St Petersburg, FL....................... 1,443,294 5,901,044 7,344,338 466,325 1964 Nov 96 Albany I Albany, GA.............................. 470,300 1,881,213 2,351,513 57,751 1981 Aug 93 Albany Plaza Albany, GA.............................. 696,447 2,947,953 3,644,400 412,520 1968 May 94 Southgate Plaza -- Albany Albany, GA.............................. 231,517 1,078,562 1,310,079 236,609 1969 Jul 90 Eastgate Plaza -- Americus Americus, GA............................ 221,637 1,144,497 1,366,134 255,483 1980 Jul 90 Perlis Plaza Americus, GA............................ 774,966 5,864,461 6,639,427 1,420,903 1972 Jul 90 Rogers Plaza Ashburn, GA............................. 291,014 799,183 1,090,197 208,917 1974 Jul 90 Sweetwater Village Austell, GA............................. 707,938 2,860,514 3,568,452 370,677 1985 Oct 94 Cedar Plaza Cedartown, GA........................... 928,302 3,763,602 4,691,904 491,584 1994 Oct 94 Cedartown Shopping Center Cedartown, GA........................... 745,006 3,350,713 4,095,719 424,588 1989 Jan 95 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL 23rd Street Station Panama City, FL......................... 40 Years Riverwood Shopping Center Port Orange, FL......................... 40 Years Seminole Plaza Seminole, FL............................ 40 Years St Augustine Outlet Center St Augustine, FL........................ 40 Years Rutland Plaza St Petersburg, FL....................... 40 Years Albany I Albany, GA.............................. 40 Years Albany Plaza Albany, GA.............................. 40 Years Southgate Plaza -- Albany Albany, GA.............................. 40 Years Eastgate Plaza -- Americus Americus, GA............................ 40 Years Perlis Plaza Americus, GA............................ 40 Years Rogers Plaza Ashburn, GA............................. 40 Years Sweetwater Village Austell, GA............................. 40 Years Cedar Plaza Cedartown, GA........................... 40 Years Cedartown Shopping Center Cedartown, GA........................... 40 Years
F-32 61 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Cordele Square Cordele, GA............................. 864,335 3,457,337 417,896 Mr B's Cordele, GA............................. 166,047 154,140 7,880 Southgate Plaza Cordele, GA -- CORDELE.................. 202,682 958,998 154,037 Habersham Crossing Cornelia, GA............................ 3,977,453 1,644,936 6,580,460 Habersham Village Cornelia, GA............................ 1,301,643 4,340,422 727,384 Covington Gallery Covington, GA........................... 2,494,987 9,979,829 Market Central Dalton, GA.............................. 791,717 3,166,957 Northside SC Dalton, GA.............................. 2,261,217 965,965 3,861,372 Midway Village Shopping Center Douglasville, GA........................ 1,553,580 2,887,506 30,692 Westgate -- Dublin Dublin, GA.............................. 699,174 5,834,809 157,749 Harvey's (Kroger) East Albany, GA......................... 336,205 1,344,642 Rite Aid #2110 East Albany, GA......................... 92,794 371,343 Marshall's at Eastlake Shopping Center Marietta, GA............................ 1,710,517 2,069,483 New Chastain Corners Shopping Center Marietta, GA............................ 2,457,446 5,741,641 79,266 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Cordele Square Cordele, GA............................. 864,335 3,875,233 4,739,568 943,038 1968 Jul 90 Mr B's Cordele, GA............................. 166,047 162,020 328,067 38,253 1968 Jul 90 Southgate Plaza Cordele, GA -- CORDELE.................. 202,682 1,113,035 1,315,717 235,621 1969 Jul 90 Habersham Crossing Cornelia, GA............................ 1,644,936 6,580,460 8,225,396 194,057 1985 Mar 96 Habersham Village Cornelia, GA............................ 1,301,643 5,067,806 6,369,449 1,063,567 1985 May 92 Covington Gallery Covington, GA........................... 2,494,987 9,979,829 12,474,816 300,879 1991 Dec 93 Market Central Dalton, GA.............................. 791,717 3,166,957 3,958,674 95,479 1995 Mar 97 Northside SC Dalton, GA.............................. 965,965 3,861,372 4,827,337 113,888 1994 Oct 95 Midway Village Shopping Center Douglasville, GA........................ 1,553,580 2,918,198 4,471,778 186,030 1989 May 97 Westgate -- Dublin Dublin, GA.............................. 699,174 5,992,558 6,691,732 1,398,132 1974 Jul 90 Harvey's (Kroger) East Albany, GA......................... 336,205 1,344,642 1,680,847 41,280 1982 Aug 93 Rite Aid #2110 East Albany, GA......................... 92,794 371,343 464,137 11,399 1982 Aug 93 Marshall's at Eastlake Shopping Center Marietta, GA............................ 1,710,517 2,069,483 3,780,000 62,516 1982 Oct 98 New Chastain Corners Shopping Center Marietta, GA............................ 2,457,446 5,820,907 8,278,353 355,858 1990 Jul 97 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Cordele Square Cordele, GA............................. 40 Years Mr B's Cordele, GA............................. 40 Years Southgate Plaza Cordele, GA -- CORDELE.................. 40 Years Habersham Crossing Cornelia, GA............................ 40 Years Habersham Village Cornelia, GA............................ 40 Years Covington Gallery Covington, GA........................... 40 Years Market Central Dalton, GA.............................. 40 Years Northside SC Dalton, GA.............................. 40 Years Midway Village Shopping Center Douglasville, GA........................ 40 Years Westgate -- Dublin Dublin, GA.............................. 40 Years Harvey's (Kroger) East Albany, GA......................... 40 Years Rite Aid #2110 East Albany, GA......................... 40 Years Marshall's at Eastlake Shopping Center Marietta, GA............................ 40 Years New Chastain Corners Shopping Center Marietta, GA............................ 40 Years
F-33 62 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Pavillions at East Lake Shopping Center Marietta, GA............................ 2,812,000 11,249,970 29,400 Village at Southlake Morrow, GA.............................. 1,733,198 3,017,677 Perry Marketplace Perry, GA............................... 7,347,084 2,776,518 11,105,959 Creekwood Shopping Center Rex, GA................................. 1,160,203 3,482,608 Shops of Riverdale Riverdale, GA........................... 655,145 2,620,747 Eisenhower Square Shopping Center Savannah, GA............................ 1,029,500 4,117,700 141,657 Victory Square Savannah, GA............................ 1,206,181 4,824,725 148,030 Wisteria Village Snellville, GA.......................... 2,525,402 2,542,919 10,200,657 3,600 University Commons Statesboro, GA.......................... 3,208,952 1,312,739 5,250,755 Tift-Town Tifton, GA.............................. 271,444 1,325,238 271,359 Westgate -- Tifton Tifton, GA.............................. 156,269 304,704 963 Kmart #9287 Atlantic, IA............................ 293,138 1,172,664 Eagle #688/329 Coralville, IA.......................... 301,006 1,203,992 Haymarket Mall Des Moines, IA.......................... 1,230,252 5,031,799 231,955 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Pavillions at East Lake Shopping Center Marietta, GA............................ 2,812,000 11,279,370 14,091,370 224,536 1986 Mar 99 Village at Southlake Morrow, GA.............................. 1,733,198 3,017,677 4,750,875 129,320 1983 Apr 98 Perry Marketplace Perry, GA............................... 2,776,518 11,105,959 13,882,477 334,830 1992 Dec 92 Creekwood Shopping Center Rex, GA................................. 1,160,203 3,482,608 4,642,811 221,207 1990 May 97 Shops of Riverdale Riverdale, GA........................... 655,145 2,620,747 3,275,892 79,011 1995 Feb 96 Eisenhower Square Shopping Center Savannah, GA............................ 1,029,500 4,259,357 5,288,857 260,164 1985 Jul 97 Victory Square Savannah, GA............................ 1,206,181 4,972,755 6,178,936 938,569 1986 Jul 92 Wisteria Village Snellville, GA.......................... 2,542,919 10,204,257 12,747,176 307,858 1985 Oct 95 University Commons Statesboro, GA.......................... 1,312,739 5,250,755 6,563,494 158,304 1994 Jul 96 Tift-Town Tifton, GA.............................. 271,444 1,596,597 1,868,041 364,768 1965 Jul 90 Westgate -- Tifton Tifton, GA.............................. 156,269 305,667 461,936 72,129 1980 Jul 90 Kmart #9287 Atlantic, IA............................ 293,138 1,172,664 1,465,802 35,998 1980 Jan 94 Eagle #688/329 Coralville, IA.......................... 301,006 1,203,992 1,504,998 36,961 1981 Aug 93 Haymarket Mall Des Moines, IA.......................... 1,230,252 5,263,754 6,494,006 592,982 1968-1979 May 95 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Pavillions at East Lake Shopping Center Marietta, GA............................ 40 Years Village at Southlake Morrow, GA.............................. 40 Years Perry Marketplace Perry, GA............................... 40 Years Creekwood Shopping Center Rex, GA................................. 40 Years Shops of Riverdale Riverdale, GA........................... 40 Years Eisenhower Square Shopping Center Savannah, GA............................ 40 Years Victory Square Savannah, GA............................ 40 Years Wisteria Village Snellville, GA.......................... 40 Years University Commons Statesboro, GA.......................... 40 Years Tift-Town Tifton, GA.............................. 40 Years Westgate -- Tifton Tifton, GA.............................. 40 Years Kmart #9287 Atlantic, IA............................ 40 Years Eagle #688/329 Coralville, IA.......................... 40 Years Haymarket Mall Des Moines, IA.......................... 40 Years
F-34 63 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Haymarket Square Des Moines, IA.......................... 2,056,172 8,224,688 477,383 Eagle #320 Dubuque, IA............................. 401,468 1,605,847 Southfield Plaza Shopping Center Bridgeview, IL.......................... 3,188,496 3,897,167 7,415,859 Eagle #085 Decatur, IL............................. 317,157 1,268,874 King City Square Mt. Vernon, IL.......................... 2,049,456 8,197,876 Estridge Court Shopping Center Naperville, IL.......................... 9,815,696 39,261,783 592,970 Kroger #704 Ottawa, IL.............................. 474,403 1,897,574 Eagle #106/Leath Furn Peoria, IL.............................. 401,504 1,605,992 Eagle #107 Springfield, IL......................... 313,959 1,255,721 Eagle #153 Sterling, IL............................ 400,527 1,601,977 Tinley Park Plaza Tinley Park, IL......................... 2,607,702 10,430,808 331,200 Schnuck Market/Kroger Waterloo, IL............................ 352,351 1,409,498 Kindercare #126 Beech Grove, IN......................... 84,586 338,102 Columbus Center Columbus, IN............................ 1,196,269 3,608,315 3,345,301 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Haymarket Square Des Moines, IA.......................... 2,056,172 8,702,071 10,758,243 1,020,184 1971-1979 May 95 Eagle #320 Dubuque, IA............................. 401,468 1,605,847 2,007,315 49,297 1980 Aug 93 Southfield Plaza Shopping Center Bridgeview, IL.......................... 3,188,496 11,313,026 14,501,522 1,201,915 1958,72 Dec 96 Eagle #085 Decatur, IL............................. 317,157 1,268,874 1,586,031 38,951 1983 Aug 93 King City Square Mt. Vernon, IL.......................... 2,049,456 8,197,876 10,247,332 247,154 1994 Jul 98 Estridge Court Shopping Center Naperville, IL.......................... 9,815,696 39,854,753 49,670,449 2,484,449 1990 Jul 97 Kroger #704 Ottawa, IL.............................. 474,403 1,897,574 2,371,977 58,253 1982 Aug 93 Eagle #106/Leath Furn Peoria, IL.............................. 401,504 1,605,992 2,007,496 49,302 1983 Aug 93 Eagle #107 Springfield, IL......................... 313,959 1,255,721 1,569,680 38,550 1982 Aug 93 Eagle #153 Sterling, IL............................ 400,527 1,601,977 2,002,504 49,179 1980 Aug 93 Tinley Park Plaza Tinley Park, IL......................... 2,607,702 10,762,008 13,369,710 1,207,373 1973 Sep 95 Schnuck Market/Kroger Waterloo, IL............................ 352,351 1,409,498 1,761,849 43,269 1982 Aug 93 Kindercare #126 Beech Grove, IN......................... 84,586 338,102 422,688 10,381 1976 Dec 92 Columbus Center Columbus, IN............................ 1,196,269 6,953,616 8,149,885 2,044,389 1964 Dec 88 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Haymarket Square Des Moines, IA.......................... 40 Years Eagle #320 Dubuque, IA............................. 40 Years Southfield Plaza Shopping Center Bridgeview, IL.......................... 40 Years Eagle #085 Decatur, IL............................. 40 Years King City Square Mt. Vernon, IL.......................... 40 Years Estridge Court Shopping Center Naperville, IL.......................... 40 Years Kroger #704 Ottawa, IL.............................. 40 Years Eagle #106/Leath Furn Peoria, IL.............................. 40 Years Eagle #107 Springfield, IL......................... 40 Years Eagle #153 Sterling, IL............................ 40 Years Tinley Park Plaza Tinley Park, IL......................... 40 Years Schnuck Market/Kroger Waterloo, IL............................ 40 Years Kindercare #126 Beech Grove, IN......................... 40 Years Columbus Center Columbus, IN............................ 40 Years
F-35 64 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Kindercare #132 Fort Wayne, IN.......................... 84,586 338,102 Eagle #634/079 Hobart, IN.............................. 332,606 1,330,353 Kindercare #125 Indianapolis, IN........................ 84,586 338,102 Kindercare #128 Indianapolis, IN........................ 84,586 338,102 Kindercare #134 Indianapolis, IN........................ 36,740 146,985 Jasper Manor Jasper, IN.............................. 1,319,937 7,110,063 26,561 Valley View Plaza Marion, IN.............................. 684,867 2,739,492 Eagle #084 Michigan City, IN....................... 275,395 1,101,747 Town Fair Shopping Center Princeton, IN........................... 1,104,876 3,759,503 10,437 Wabash Valley Plaza Terre Haute, IN......................... 2,747,241 649,120 2,596,480 52,900 Wabash Crossing Wabash, IN.............................. 1,599,488 6,470,511 27,744 Woodland Plaza Warsaw, IN.............................. 420,188 1,680,587 21,001 Green River Plaza Campbellsville, KY...................... 5,344,386 2,410,959 9,644,967 Kmart Plaza-Eliz Elizabethtown, KY....................... 5,160,308 1,703,868 6,815,386 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Kindercare #132 Fort Wayne, IN.......................... 84,586 338,102 422,688 10,381 1976 Dec 92 Eagle #634/079 Hobart, IN.............................. 332,606 1,330,353 1,662,959 40,840 1983 Aug 93 Kindercare #125 Indianapolis, IN........................ 84,586 338,102 422,688 10,381 1976 Dec 92 Kindercare #128 Indianapolis, IN........................ 84,586 338,102 422,688 10,381 1976 Dec 92 Kindercare #134 Indianapolis, IN........................ 36,740 146,985 183,725 4,512 1975 Dec 92 Jasper Manor Jasper, IN.............................. 1,319,937 7,136,624 8,456,561 1,405,182 1990 Feb 92 Valley View Plaza Marion, IN.............................. 684,867 2,739,492 3,424,359 82,592 1989 Mar 94 Eagle #084 Michigan City, IN....................... 275,395 1,101,747 1,377,142 33,821 1983 Aug 93 Town Fair Shopping Center Princeton, IN........................... 1,104,876 3,769,940 4,874,816 646,798 1991 Feb 93 Wabash Valley Plaza Terre Haute, IN......................... 649,120 2,649,380 3,298,500 99,840 1989 Mar 94 Wabash Crossing Wabash, IN.............................. 1,599,488 6,498,255 8,097,743 982,296 1988 Dec 93 Woodland Plaza Warsaw, IN.............................. 420,188 1,701,588 2,121,776 53,378 1989 Mar 94 Green River Plaza Campbellsville, KY...................... 2,410,959 9,644,967 12,055,926 284,441 1989 Mar 96 Kmart Plaza-Eliz Elizabethtown, KY....................... 1,703,868 6,815,386 8,519,254 205,475 1992 Feb 93 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Kindercare #132 Fort Wayne, IN.......................... 40 Years Eagle #634/079 Hobart, IN.............................. 40 Years Kindercare #125 Indianapolis, IN........................ 40 Years Kindercare #128 Indianapolis, IN........................ 40 Years Kindercare #134 Indianapolis, IN........................ 40 Years Jasper Manor Jasper, IN.............................. 40 Years Valley View Plaza Marion, IN.............................. 40 Years Eagle #084 Michigan City, IN....................... 40 Years Town Fair Shopping Center Princeton, IN........................... 40 Years Wabash Valley Plaza Terre Haute, IN......................... 40 Years Wabash Crossing Wabash, IN.............................. 40 Years Woodland Plaza Warsaw, IN.............................. 40 Years Green River Plaza Campbellsville, KY...................... 40 Years Kmart Plaza-Eliz Elizabethtown, KY....................... 40 Years
F-36 65 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Highland Commons Glasgow, KY............................. 4,782,617 1,715,609 6,862,680 17,748 J*Town Center Jeffersontown, KY....................... 1,331,074 4,121,997 616,521 Mist Lake Plaza Lexington, KY........................... 10,057,352 4,101,461 16,405,956 London Marketplace London, KY.............................. 5,377,251 2,520,416 10,081,562 Piccadilly Square Louisville, KY.......................... 355,000 1,588,409 466,969 Eastgate Shopping Center Middletown, KY.......................... 1,945,679 7,792,717 734,033 Lexington Road Plaza Versailles, KY.......................... 8,203,265 2,856,229 11,425,027 19,065 Lagniappe Village New Iberia, LA.......................... 6,849,139 3,122,914 12,491,850 41,804 Brookshire Grocery Co West Monroe, LA......................... 388,984 1,556,046 Fruitland Plaza Fruitland, MD........................... 312,650 1,833,330 911,263 Liberty Plaza Randallstown, MD........................ 2,075,809 8,303,237 231,483 Rising Sun Towne Centre Rising Sun, MD.......................... 1,161,300 4,389,359 4,950 Maple Village Shopping Center Ann Arbor, MI........................... 1,625,580 6,514,322 1,693,756 Mountain Jack's #210303 Dearborn Heights, MI.................... 287,462 1,149,835 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Highland Commons Glasgow, KY............................. 1,715,609 6,880,428 8,596,037 207,250 1992 Mar 93 J*Town Center Jeffersontown, KY....................... 1,331,074 4,738,518 6,069,592 1,340,748 1959 Oct 88 Mist Lake Plaza Lexington, KY........................... 4,101,461 16,405,956 20,507,417 494,616 1993 Jul 98 London Marketplace London, KY.............................. 2,520,416 10,081,562 12,601,978 303,946 1994 Mar 94 Piccadilly Square Louisville, KY.......................... 355,000 2,055,378 2,410,378 559,124 1973 Apr 89 Eastgate Shopping Center Middletown, KY.......................... 1,945,679 8,526,750 10,472,429 1,410,413 1987 Nov 93 Lexington Road Plaza Versailles, KY.......................... 2,856,229 11,444,092 14,300,321 348,087 1994 Apr 94 Lagniappe Village New Iberia, LA.......................... 3,122,914 12,533,654 15,656,568 377,656 1990 Jul 98 Brookshire Grocery Co West Monroe, LA......................... 388,984 1,556,046 1,945,030 47,768 1981 Aug 93 Fruitland Plaza Fruitland, MD........................... 312,650 2,744,593 3,057,243 732,410 1973 May 86 Liberty Plaza Randallstown, MD........................ 2,075,809 8,534,720 10,610,529 1,000,994 1962 May 95 Rising Sun Towne Centre Rising Sun, MD.......................... 1,161,300 4,394,309 5,555,609 59,224 1998 Jun 99 Maple Village Shopping Center Ann Arbor, MI........................... 1,625,580 8,208,078 9,833,658 1,201,784 1965 Oct 94 Mountain Jack's #210303 Dearborn Heights, MI.................... 287,462 1,149,835 1,437,297 35,298 1980 Dec 92 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Highland Commons Glasgow, KY............................. 40 Years J*Town Center Jeffersontown, KY....................... 40 Years Mist Lake Plaza Lexington, KY........................... 40 Years London Marketplace London, KY.............................. 40 Years Piccadilly Square Louisville, KY.......................... 40 Years Eastgate Shopping Center Middletown, KY.......................... 40 Years Lexington Road Plaza Versailles, KY.......................... 40 Years Lagniappe Village New Iberia, LA.......................... 40 Years Brookshire Grocery Co West Monroe, LA......................... 40 Years Fruitland Plaza Fruitland, MD........................... 35 Years Liberty Plaza Randallstown, MD........................ 40 Years Rising Sun Towne Centre Rising Sun, MD.......................... 40 Years Maple Village Shopping Center Ann Arbor, MI........................... 40 Years Mountain Jack's #210303 Dearborn Heights, MI.................... 40 Years
F-37 66 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Farmington Crossroads Farmington, MI.......................... 1,092,200 4,368,800 68,806 Kindercare #1182 Kalamazoo, MI........................... 119,214 476,915 Delta Center Lansing, MI............................. 2,405,200 9,620,800 185,485 Hampton Village Centre Rochester Hills, MI..................... 15,995,007 8,638,500 34,541,500 271,568 Fashion Corners Saginaw, MI............................. 2,244,800 8,799,200 112,181 Hall Road Crossing Shelby, MI.............................. 2,595,500 10,382,000 798,438 Southfield Plaza Southfield, MI.......................... 2,052,995 8,074,406 Delco Plaza Sterling Heights, MI.................... 1,277,504 5,109,367 46,815 Westland Crossing Westland, MI............................ 2,046,000 8,184,000 373,800 Roundtree Place Ypsilanti, MI........................... 7,402,210 2,995,774 11,983,221 59,421 Washtenaw Fountain Plaza Ypsilanti, MI........................... 1,530,281 6,121,123 361,433 Firstar Bank Burnsville, MN.......................... 330,888 1,323,798 Unity Professional Bldg Fridley, MN............................. 5,500,653 2,402,467 9,612,099 59,357 Stillwater Stillwater, MN.......................... 275,991 120,171 480,682 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Farmington Crossroads Farmington, MI.......................... 1,092,200 4,437,606 5,529,806 446,271 1986 Dec 95 Kindercare #1182 Kalamazoo, MI........................... 119,214 476,915 596,129 14,640 1990 Feb 91 Delta Center Lansing, MI............................. 2,405,200 9,806,285 12,211,485 988,057 1985 Dec 95 Hampton Village Centre Rochester Hills, MI..................... 8,638,500 34,813,068 43,451,568 3,466,088 1990 Dec 95 Fashion Corners Saginaw, MI............................. 2,244,800 8,911,381 11,156,181 896,345 1986 Dec 95 Hall Road Crossing Shelby, MI.............................. 2,595,500 11,180,438 13,775,938 1,098,252 1985 Dec 95 Southfield Plaza Southfield, MI.......................... 2,052,995 8,074,406 10,127,401 367,800 1969-70 Feb 98 Delco Plaza Sterling Heights, MI.................... 1,277,504 5,156,182 6,433,686 392,637 1970,73 Nov 96 Westland Crossing Westland, MI............................ 2,046,000 8,557,800 10,603,800 27,274 1986 Nov 99 Roundtree Place Ypsilanti, MI........................... 2,995,774 12,042,642 15,038,416 364,621 1998 Jul 98 Washtenaw Fountain Plaza Ypsilanti, MI........................... 1,530,281 6,482,556 8,012,837 1,297,882 1989 Oct 92 Firstar Bank Burnsville, MN.......................... 330,888 1,323,798 1,654,686 40,637 1975 Aug 97 Unity Professional Bldg Fridley, MN............................. 2,402,467 9,671,456 12,073,923 294,797 1991 May 96 Stillwater Stillwater, MN.......................... 120,171 480,682 600,853 15,087 1985 Jul 91 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Farmington Crossroads Farmington, MI.......................... 40 Years Kindercare #1182 Kalamazoo, MI........................... 40 Years Delta Center Lansing, MI............................. 40 Years Hampton Village Centre Rochester Hills, MI..................... 40 Years Fashion Corners Saginaw, MI............................. 40 Years Hall Road Crossing Shelby, MI.............................. 40 Years Southfield Plaza Southfield, MI.......................... 40 Years Delco Plaza Sterling Heights, MI.................... 40 Years Westland Crossing Westland, MI............................ 40 Years Roundtree Place Ypsilanti, MI........................... 40 Years Washtenaw Fountain Plaza Ypsilanti, MI........................... 40 Years Firstar Bank Burnsville, MN.......................... 40 Years Unity Professional Bldg Fridley, MN............................. 40 Years Stillwater Stillwater, MN.......................... 40 Years
F-38 67 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Factory Merchants Branson Branson, MO............................. 17,669 22,312,120 11,911,121 Kindercare #162 Fenton, MO.............................. 45,020 180,008 Kindercare #577 High Ridge, MO.......................... 54,942 219,786 Factory Outlet Village Osage Beach Osage Beach, MO......................... 6,978,714 27,259,675 7,810,582 Stanly County Plaza Albemarle, NC........................... 600,418 2,401,671 Village Marketplace Ashboro, NC............................. 1,155,652 4,622,609 Shopping Center -- Goldsboro Goldsboro, NC........................... 181,998 1,014,432 55,222 Pizza Hut Greenville, NC.......................... 40,065 225,958 Foothills Market Jonesville, NC.......................... 644,555 2,578,295 Chapel Square SC Kannapolis, NC.......................... 2,245,127 918,460 3,673,918 Piney Grove Plaza Kernersville, NC........................ 493,023 1,972,092 Kinston Pointe Kinston, NC............................. 2,235,052 8,940,354 1,100 Granville Corners Oxford, NC.............................. 2,185,356 8,741,261 Roxboro Square Roxboro, NC............................. 1,448,313 5,793,290 35,857 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Factory Merchants Branson Branson, MO............................. 17,669 34,223,241 34,240,910 5,392,702 1988 Nov 93 Kindercare #162 Fenton, MO.............................. 45,020 180,008 225,028 5,526 1977 Dec 92 Kindercare #577 High Ridge, MO.......................... 54,942 219,786 274,728 6,747 1980 Dec 92 Factory Outlet Village Osage Beach Osage Beach, MO......................... 6,978,714 35,070,257 42,048,971 6,305,127 1987 Jan 93 Stanly County Plaza Albemarle, NC........................... 600,418 2,401,671 3,002,089 75,379 1988 Mar 94 Village Marketplace Ashboro, NC............................. 1,155,652 4,622,609 5,778,261 145,086 1988 Apr 95 Shopping Center -- Goldsboro Goldsboro, NC........................... 181,998 1,069,654 1,251,652 404,245 1973 May 86 Pizza Hut Greenville, NC.......................... 40,065 225,958 266,023 99,508 1973 May 86 Foothills Market Jonesville, NC.......................... 644,555 2,578,295 3,222,850 77,732 1988 Jun 95 Chapel Square SC Kannapolis, NC.......................... 918,460 3,673,918 4,592,378 110,551 1992 Dec 94 Piney Grove Plaza Kernersville, NC........................ 493,023 1,972,092 2,465,115 61,896 1988 Jun 95 Kinston Pointe Kinston, NC............................. 2,235,052 8,941,454 11,176,506 269,538 1991 Jul 95 Granville Corners Oxford, NC.............................. 2,185,356 8,741,261 10,926,617 263,538 1991 Feb 96 Roxboro Square Roxboro, NC............................. 1,448,313 5,829,147 7,277,460 182,129 1989 Jun 95 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Factory Merchants Branson Branson, MO............................. 40 Years Kindercare #162 Fenton, MO.............................. 40 Years Kindercare #577 High Ridge, MO.......................... 40 Years Factory Outlet Village Osage Beach Osage Beach, MO......................... 40 Years Stanly County Plaza Albemarle, NC........................... 40 Years Village Marketplace Ashboro, NC............................. 40 Years Shopping Center -- Goldsboro Goldsboro, NC........................... 35 Years Pizza Hut Greenville, NC.......................... 35 Years Foothills Market Jonesville, NC.......................... 40 Years Chapel Square SC Kannapolis, NC.......................... 40 Years Piney Grove Plaza Kernersville, NC........................ 40 Years Kinston Pointe Kinston, NC............................. 40 Years Granville Corners Oxford, NC.............................. 40 Years Roxboro Square Roxboro, NC............................. 40 Years
F-39 68 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Siler Crossing Siler City, NC.......................... 1,779,566 7,118,099 Crossroads SC Statesville, NC......................... 5,261,636 21,177,391 Thomasville Crossing Thomasville, NC......................... 1,604,339 6,417,145 Anson Station Wadesboro, NC........................... 1,844,644 7,378,756 13,250 Roanoke Landing Williamston, NC......................... 6,097,611 2,519,288 10,077,339 42,363 Shopping Center -- Wilson Wilson, NC.............................. 315,000 1,780,370 71,456 Stratford Commons Winston-Salem, NC....................... 6,144,961 2,262,130 9,045,975 Northern Auto #138 Grand Island, NE........................ 125,317 501,501 Northern Auto #125 Hastings, NE............................ 89,784 358,964 Kmart #6256 Omaha, NE............................... 532,124 2,128,701 18,949 Laurel Square Bricktown, NJ........................... 3,261,701 9,283,302 759,174 Hamilton Plaza Hamilton, NJ............................ 1,124,415 4,513,658 230,258 Bennetts Mills Plaza Jackson, NJ............................. 1,794,122 6,399,888 73,746 Six Flags Factory Outlet Jackson, NJ............................. 889,214 1,249,781 29,908,881 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Siler Crossing Siler City, NC.......................... 1,779,566 7,118,099 8,897,665 214,602 1988 Jun 95 Crossroads SC Statesville, NC......................... 5,261,636 21,177,391 26,439,027 634,519 1991 Feb 96 Thomasville Crossing Thomasville, NC......................... 1,604,339 6,417,145 8,021,484 193,469 1996 Apr 97 Anson Station Wadesboro, NC........................... 1,844,644 7,392,006 9,236,650 222,472 1988 Aug 95 Roanoke Landing Williamston, NC......................... 2,519,288 10,119,702 12,638,990 304,214 1991 Jan 96 Shopping Center -- Wilson Wilson, NC.............................. 315,000 1,851,826 2,166,826 705,874 1973 May 86 Stratford Commons Winston-Salem, NC....................... 2,262,130 9,045,975 11,308,105 266,790 1995 Dec 96 Northern Auto #138 Grand Island, NE........................ 125,317 501,501 626,818 15,394 1988 Dec 92 Northern Auto #125 Hastings, NE............................ 89,784 358,964 448,748 11,021 1988 Dec 92 Kmart #6256 Omaha, NE............................... 532,124 2,147,650 2,679,774 65,711 1981 Aug 93 Laurel Square Bricktown, NJ........................... 3,261,701 10,042,476 13,304,177 1,924,424 1973 Jul 92 Hamilton Plaza Hamilton, NJ............................ 1,124,415 4,743,916 5,868,331 714,422 1972 May 94 Bennetts Mills Plaza Jackson, NJ............................. 1,794,122 6,473,634 8,267,756 852,673 1988 Sep 94 Six Flags Factory Outlet Jackson, NJ............................. 889,214 31,158,662 32,047,876 1,806,843 1997 Apr 97 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Siler Crossing Siler City, NC.......................... 40 Years Crossroads SC Statesville, NC......................... 40 Years Thomasville Crossing Thomasville, NC......................... 40 Years Anson Station Wadesboro, NC........................... 40 Years Roanoke Landing Williamston, NC......................... 40 Years Shopping Center -- Wilson Wilson, NC.............................. 35 Years Stratford Commons Winston-Salem, NC....................... 40 Years Northern Auto #138 Grand Island, NE........................ 40 Years Northern Auto #125 Hastings, NE............................ 40 Years Kmart #6256 Omaha, NE............................... 40 Years Laurel Square Bricktown, NJ........................... 40 Years Hamilton Plaza Hamilton, NJ............................ 40 Years Bennetts Mills Plaza Jackson, NJ............................. 40 Years Six Flags Factory Outlet Jackson, NJ............................. 40 Years
F-40 69 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Middletown Plaza Middletown, NJ.......................... 1,204,829 1,479,487 3,943,587 Institute for Defense Analysis Princeton, NJ........................... 1,389,460 Roxbury Township NJ Roxbury, NJ............................. 314,576 Kmart #7197 Somerville, NJ.......................... 462,313 1,849,393 Tinton Falls Plaza Tinton Falls, NJ........................ 1,884,325 6,308,392 147,173 Galleria Commons Henderson, NV........................... 6,854,959 27,590,493 10,001 Renaissance Center East Las Vegas, NV........................... 2,543,856 10,175,427 218,955 Kietzke Center Reno, NV................................ 3,069,735 12,279,924 University Mall Canton, NY.............................. 115,079 1,009,902 809,401 Cortlandville Cortland, NY............................ 236,846 1,439,000 430,013 Kmart Plaza Dewitt, NY.............................. 942,257 3,769,027 246,904 D & F Plaza Dunkirk, NY............................. 730,512 2,156,542 1,544,172 Shopping Center -- Elmira Elmira, NY.............................. 110,116 891,205 Genesse Valley Genesse, NY............................. 9,051,617 3,636,064 14,544,101 12,812 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Middletown Plaza Middletown, NJ.......................... 1,204,829 5,423,074 6,627,903 2,136,865 1972 Jan 75 Institute for Defense Analysis Princeton, NJ........................... 1,389,460 1,389,460 750,712 1982 May 74 Roxbury Township NJ Roxbury, NJ............................. 314,576 314,576 Dec 97 Kmart #7197 Somerville, NJ.......................... 462,313 1,849,393 2,311,706 56,773 1982 Aug 93 Tinton Falls Plaza Tinton Falls, NJ........................ 1,884,325 6,455,565 8,339,890 308,660 1953 Jan 98 Galleria Commons Henderson, NV........................... 6,854,959 27,600,494 34,455,453 826,752 1997-98 Jun 98 Renaissance Center East Las Vegas, NV........................... 2,543,856 10,394,382 12,938,238 858,384 1981 Oct 96 Kietzke Center Reno, NV................................ 3,069,735 12,279,924 15,349,659 362,143 1974 Jun 97 University Mall Canton, NY.............................. 115,079 1,819,303 1,934,382 1,037,081 1967 Jan 76 Cortlandville Cortland, NY............................ 236,846 1,869,013 2,105,859 548,147 1984 Aug 87 Kmart Plaza Dewitt, NY.............................. 942,257 4,015,931 4,958,188 645,729 1970 Aug 93 D & F Plaza Dunkirk, NY............................. 730,512 3,700,714 4,431,226 1,264,550 1967 Jan 86 Shopping Center -- Elmira Elmira, NY.............................. 110,116 891,205 1,001,321 242,297 1976 Feb 89 Genesse Valley Genesse, NY............................. 3,636,064 14,556,913 18,192,977 439,731 1993 Jul 98 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Middletown Plaza Middletown, NJ.......................... 40 Years Institute for Defense Analysis Princeton, NJ........................... 35 Years Roxbury Township NJ Roxbury, NJ............................. Kmart #7197 Somerville, NJ.......................... 40 Years Tinton Falls Plaza Tinton Falls, NJ........................ 40 Years Galleria Commons Henderson, NV........................... 40 Years Renaissance Center East Las Vegas, NV........................... 40 Years Kietzke Center Reno, NV................................ 40 Years University Mall Canton, NY.............................. 40 Years Cortlandville Cortland, NY............................ 35 Years Kmart Plaza Dewitt, NY.............................. 40 Years D & F Plaza Dunkirk, NY............................. 40 Years Shopping Center -- Elmira Elmira, NY.............................. 40 Years Genesse Valley Genesse, NY............................. 40 Years
F-41 70 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Pyramid Mall Geneva, NY.............................. 2,175,221 8,700,884 130,112 Shopping Center -- Gloversville Gloversville, NY........................ 139,429 524,517 104,564 Mckinley Plaza Hamburg, NY............................. 1,246,680 4,986,720 123,938 1 North Central Avenue Hartsdale, NY........................... 18,663 Hornell Plaza Hornell, NY............................. 164,900 20,852,444 Cayuga Plaza Ithaca, NY.............................. 1,397,708 5,591,832 504,127 Shops @ Seneca Mall Liverpool, NY........................... 1,545,838 6,183,353 1,012,551 Transit Road Plaza Lockport, NY............................ 424,634 1,698,537 411,938 Shopping Center Marcy, NY -- MARCY...................... 400,000 2,231,817 94,207 Wallkill Plaza Middletown, NY.......................... 2,745,200 9,660,800 148,852 Monroe Shoprite Plaza Monroe, NY.............................. 1,026,477 8,642,364 80,406 Rockland Plaza Nanuet, NY.............................. 3,990,842 3,570,410 5,310,035 South Plaza Norwich, NY............................. 508,013 1,051,638 1,608,758 Westgate Plaza -- Oneonta Oneonta, NY............................. 142,821 1,192,103 302,942 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Pyramid Mall Geneva, NY.............................. 2,175,221 8,830,996 11,006,217 1,418,403 1973 Aug 93 Shopping Center -- Gloversville Gloversville, NY........................ 139,429 629,081 768,510 171,854 1974 Dec 88 Mckinley Plaza Hamburg, NY............................. 1,246,680 5,110,658 6,357,338 1,028,112 1991 Jun 92 1 North Central Avenue Hartsdale, NY........................... 18,663 18,663 Jul 72 Hornell Plaza Hornell, NY............................. 164,900 20,852,444 21,017,344 630,503 1995 Jul 98 Cayuga Plaza Ithaca, NY.............................. 1,397,708 6,095,959 7,493,667 1,649,264 1969 May 89 Shops @ Seneca Mall Liverpool, NY........................... 1,545,838 7,195,904 8,741,742 1,062,462 1971 Aug 93 Transit Road Plaza Lockport, NY............................ 424,634 2,110,475 2,535,109 360,284 1971 Aug 93 Shopping Center Marcy, NY -- MARCY...................... 400,000 2,326,024 2,726,024 906,986 1971 May 86 Wallkill Plaza Middletown, NY.......................... 2,745,200 9,809,652 12,554,852 891,264 1986 Dec 95 Monroe Shoprite Plaza Monroe, NY.............................. 1,026,477 8,722,770 9,749,247 481,973 1972 Aug 97 Rockland Plaza Nanuet, NY.............................. 3,990,842 8,880,445 12,871,287 3,893,591 1963 Jan 83 South Plaza Norwich, NY............................. 508,013 2,660,396 3,168,409 1,204,303 1967 Apr 83 Westgate Plaza -- Oneonta Oneonta, NY............................. 142,821 1,495,045 1,637,866 632,436 1967 Jan 84 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Pyramid Mall Geneva, NY.............................. 40 Years Shopping Center -- Gloversville Gloversville, NY........................ 40 Years Mckinley Plaza Hamburg, NY............................. 40 Years 1 North Central Avenue Hartsdale, NY........................... Hornell Plaza Hornell, NY............................. 40 Years Cayuga Plaza Ithaca, NY.............................. 40 Years Shops @ Seneca Mall Liverpool, NY........................... 40 Years Transit Road Plaza Lockport, NY............................ 40 Years Shopping Center Marcy, NY -- MARCY...................... 35 Years Wallkill Plaza Middletown, NY.......................... 40 Years Monroe Shoprite Plaza Monroe, NY.............................. 40 Years Rockland Plaza Nanuet, NY.............................. 40 Years South Plaza Norwich, NY............................. 40 Years Westgate Plaza -- Oneonta Oneonta, NY............................. 40 Years
F-42 71 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Oswego Plaza Oswego, NY.............................. 250,000 1,168,027 2,591,920 Mohawk Rome, NY................................ 93,341 483,405 231,437 Mohawk Acres Rome, NY................................ 241,606 1,268,890 1,608,903 Price Chopper Plaza Rome, NY................................ 933,792 3,735,170 Westgate Manor Plaza Rome, NY -- ROME........................ 211,711 391,982 958,632 Northland Watertown, NY........................... 16,182 255,557 836,600 Ashland Square Ashland, OH............................. 1,990,823 7,963,282 Harbor Plaza Ashtabula, OH........................... 388,997 1,456,108 253,099 Belpre Plaza Belpre, OH.............................. 2,066,121 145,088 Southwood Plaza Bowling Green, OH....................... 707,073 1,537,519 879,270 Lakewood Village Celina, OH.............................. 937,772 3,751,086 27,120 Brentwood Plaza Cincinnati, OH.......................... 2,027,969 8,222,875 670,189 Delhi Shopping Center Cincinnati, OH.......................... 2,300,029 9,218,117 30,518 Western Village Shopping Center Cincinnati, OH.......................... 1,321,484 5,300,935 157,180 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Oswego Plaza Oswego, NY.............................. 250,000 3,759,947 4,009,947 1,663,903 1966 Jan 77 Mohawk Rome, NY................................ 93,341 714,842 808,183 303,206 1965 Jan 84 Mohawk Acres Rome, NY................................ 241,606 2,877,793 3,119,399 1,036,040 1965 Feb 84 Price Chopper Plaza Rome, NY................................ 933,792 3,735,170 4,668,962 595,631 1988 Aug 93 Westgate Manor Plaza Rome, NY -- ROME........................ 211,711 1,350,614 1,562,325 371,378 1961 Jan 86 Northland Watertown, NY........................... 16,182 1,092,157 1,108,339 396,864 1962 Jan 73 Ashland Square Ashland, OH............................. 1,990,823 7,963,282 9,954,105 240,082 1990 Oct 93 Harbor Plaza Ashtabula, OH........................... 388,997 1,709,207 2,098,204 411,148 1988 Feb 91 Belpre Plaza Belpre, OH.............................. 2,211,209 2,211,209 703,524 1969 Jun 88 Southwood Plaza Bowling Green, OH....................... 707,073 2,416,789 3,123,862 940,449 1961 May 90 Lakewood Village Celina, OH.............................. 937,772 3,778,206 4,715,978 128,656 1990 Mar 94 Brentwood Plaza Cincinnati, OH.......................... 2,027,969 8,893,064 10,921,033 1,231,973 1957 May 94 Delhi Shopping Center Cincinnati, OH.......................... 2,300,029 9,248,635 11,548,664 819,605 1973,85,87 May 96 Western Village Shopping Center Cincinnati, OH.......................... 1,321,484 5,458,115 6,779,599 766,238 1960 May 94 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Oswego Plaza Oswego, NY.............................. 40 Years Mohawk Rome, NY................................ 40 Years Mohawk Acres Rome, NY................................ 40 Years Price Chopper Plaza Rome, NY................................ 40 Years Westgate Manor Plaza Rome, NY -- ROME........................ 40 Years Northland Watertown, NY........................... 40 Years Ashland Square Ashland, OH............................. 40 Years Harbor Plaza Ashtabula, OH........................... 40 Years Belpre Plaza Belpre, OH.............................. 40 Years Southwood Plaza Bowling Green, OH....................... 40 Years Lakewood Village Celina, OH.............................. 40 Years Brentwood Plaza Cincinnati, OH.......................... 40 Years Delhi Shopping Center Cincinnati, OH.......................... 40 Years Western Village Shopping Center Cincinnati, OH.......................... 40 Years
F-43 72 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Crown Point Shopping Center Columbus, OH............................ 7,706,368 2,881,681 7,958,319 8,564 River Run Centre Coshocton, OH........................... 2,740,831 1,050,261 4,201,106 South Towne Centre Dayton, OH.............................. 4,737,368 9,636,943 1,598,843 Heritage Square Dover, OH............................... 1,749,182 7,011,927 59,707 Midway Crossing Elyria, OH.............................. 1,944,200 7,776,800 192,574 Fairfield Mall Fairfield, OH........................... 1,287,649 1,685,919 228,983 Silver Bridge Plaza Gallipolis, OH.......................... 919,022 3,197,673 1,500,228 Shopping Center -- Genoa Genoa, OH............................... 96,001 1,016,349 Parkway Plaza Maumee, OH.............................. 950,667 2,069,921 476,756 New Boston Shopping Center New Boston, OH.......................... 2,102,371 9,176,918 128,373 Market Place Piqua, OH............................... 597,923 3,738,164 403,895 Brice Park Shopping Center Reynoldsburg, OH........................ 4,789,304 4,854,414 10,204,698 9,469 Central Ave Market Place Toledo, OH.............................. 1,046,480 1,769,207 381,861 Greentree Shopping Center Upper Arlington, OH..................... 6,507,325 3,379,200 6,860,800 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Crown Point Shopping Center Columbus, OH............................ 2,881,681 7,966,883 10,848,564 333,131 1980-85,97 Jul 98 River Run Centre Coshocton, OH........................... 1,050,261 4,201,106 5,251,367 126,657 1992 Jul 98 South Towne Centre Dayton, OH.............................. 4,737,368 11,235,786 15,973,154 2,445,217 1972 Mar 92 Heritage Square Dover, OH............................... 1,749,182 7,071,634 8,820,816 1,174,016 1959 Aug 93 Midway Crossing Elyria, OH.............................. 1,944,200 7,969,374 9,913,574 798,237 1986 Dec 95 Fairfield Mall Fairfield, OH........................... 1,287,649 1,914,902 3,202,551 447,995 1978 May 90 Silver Bridge Plaza Gallipolis, OH.......................... 919,022 4,697,901 5,616,923 2,040,760 1972 Dec 86 Shopping Center -- Genoa Genoa, OH............................... 96,001 1,016,349 1,112,350 223,563 1987 Mar 91 Parkway Plaza Maumee, OH.............................. 950,667 2,546,677 3,497,344 661,930 1955 Sep 89 New Boston Shopping Center New Boston, OH.......................... 2,102,371 9,305,291 11,407,662 1,599,324 1991 Feb 93 Market Place Piqua, OH............................... 597,923 4,142,059 4,739,982 1,002,206 1972 Nov 91 Brice Park Shopping Center Reynoldsburg, OH........................ 4,854,414 10,214,167 15,068,581 437,813 1989-92 Mar 98 Central Ave Market Place Toledo, OH.............................. 1,046,480 2,151,068 3,197,548 491,833 1968 Aug 90 Greentree Shopping Center Upper Arlington, OH..................... 3,379,200 6,860,800 10,240,000 285,867 1974,80,91 Jul 98 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Crown Point Shopping Center Columbus, OH............................ 40 Years River Run Centre Coshocton, OH........................... 40 Years South Towne Centre Dayton, OH.............................. 40 Years Heritage Square Dover, OH............................... 40 Years Midway Crossing Elyria, OH.............................. 40 Years Fairfield Mall Fairfield, OH........................... 40 Years Silver Bridge Plaza Gallipolis, OH.......................... 40 Years Shopping Center -- Genoa Genoa, OH............................... 40 Years Parkway Plaza Maumee, OH.............................. 40 Years New Boston Shopping Center New Boston, OH.......................... 40 Years Market Place Piqua, OH............................... 40 Years Brice Park Shopping Center Reynoldsburg, OH........................ 40 Years Central Ave Market Place Toledo, OH.............................. 40 Years Greentree Shopping Center Upper Arlington, OH..................... 40 Years
F-44 73 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Sunfresh (Associated Grocers) Muskogee, OK............................ 476,864 1,907,694 Bethel Park Plaza Bethel Park, PA......................... 868,039 9,933,094 929,972 Supervalu/Clearfield Clearfield, PA.......................... 357,218 1,429,000 Dillsburg Shopping Center Dillsburg, PA........................... 1,166,376 4,665,505 66,170 Market Street Square Elizabethtown, PA....................... 3,494,045 13,976,027 Hardees -- Pad Hanover, PA............................. 400,000 New Garden Shopping Center Kennett Square, PA...................... 912,130 3,161,495 (17,349) Stonemill Plaza Lancaster, PA........................... 1,407,975 5,650,901 90,426 Crossroads Plaza Mt. Pleasant, PA........................ 384,882 1,040,668 443,627 Acme Market Philadelphia, PA........................ 227,720 1,398,726 Ivyridge Shopping Center Philadelphia, PA........................ 1,504,080 6,026,320 924,868 Roosevelt Mall Annex Philadelphia, PA........................ 159,703 91,798 1,076,586 Roosevelt Mall NE Philadelphia, PA........................ 1,772,067 2,602,635 6,970,168 Strawbridge's Philadelphia, PA........................ 605,607 3,923,050 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Sunfresh (Associated Grocers) Muskogee, OK............................ 476,864 1,907,694 2,384,558 58,562 1981 Aug 93 Bethel Park Plaza Bethel Park, PA......................... 868,039 10,863,066 11,731,105 772,008 1965 May 97 Supervalu/Clearfield Clearfield, PA.......................... 357,218 1,429,000 1,786,218 43,867 1982 Aug 93 Dillsburg Shopping Center Dillsburg, PA........................... 1,166,376 4,731,675 5,898,051 374,268 1994 Oct 96 Market Street Square Elizabethtown, PA....................... 3,494,045 13,976,027 17,470,072 421,358 1993-94 Oct 97 Hardees -- Pad Hanover, PA............................. 400,000 400,000 24,583 1971 Jul 97 New Garden Shopping Center Kennett Square, PA...................... 912,130 3,144,146 4,056,276 211,686 1979 Apr 97 Stonemill Plaza Lancaster, PA........................... 1,407,975 5,741,327 7,149,302 857,646 1988 Jan 94 Crossroads Plaza Mt. Pleasant, PA........................ 384,882 1,484,295 1,869,177 390,142 1975 Nov 88 Acme Market Philadelphia, PA........................ 227,720 1,398,726 1,626,446 48,062 1980 Aug 98 Ivyridge Shopping Center Philadelphia, PA........................ 1,504,080 6,951,188 8,455,268 705,771 1963 Aug 95 Roosevelt Mall Annex Philadelphia, PA........................ 159,703 1,168,384 1,328,087 663,206 1958 Apr 74 Roosevelt Mall NE Philadelphia, PA........................ 1,772,067 9,572,803 11,344,870 5,188,787 1964 Jan 64 Strawbridge's Philadelphia, PA........................ 605,607 3,923,050 4,528,657 3,923,050 1964 Jan 64 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Sunfresh (Associated Grocers) Muskogee, OK............................ 40 Years Bethel Park Plaza Bethel Park, PA......................... 40 Years Supervalu/Clearfield Clearfield, PA.......................... 40 Years Dillsburg Shopping Center Dillsburg, PA........................... 40 Years Market Street Square Elizabethtown, PA....................... 40 Years Hardees -- Pad Hanover, PA............................. 35 Years New Garden Shopping Center Kennett Square, PA...................... 40 Years Stonemill Plaza Lancaster, PA........................... 40 Years Crossroads Plaza Mt. Pleasant, PA........................ 40 Years Acme Market Philadelphia, PA........................ 40 Years Ivyridge Shopping Center Philadelphia, PA........................ 40 Years Roosevelt Mall Annex Philadelphia, PA........................ 40 Years Roosevelt Mall NE Philadelphia, PA........................ 40 Years Strawbridge's Philadelphia, PA........................ 35 Years
F-45 74 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Giant Eagle #637 Pittsburgh, PA.......................... 514,470 2,057,726 Johnstown Galleria Richland Township, PA................... 3,486,549 1,584,716 6,338,788 St Mary's Plaza St Mary's, PA........................... 977,711 3,910,842 137,560 Northland Center State College, PA....................... 1,253,513 5,306,721 84,929 Hampton Square Shopping Center Upper So Hampton, PA.................... 772,800 2,907,200 Shops at Prospect West Hempfield, PA...................... 741,941 2,967,765 70,154 York Marketplace York, PA................................ 3,199,353 12,797,412 1,860,678 Circle Center Hilton Head Island, SC.................. 4,918,030 1,533,329 6,133,106 Crossroads -- Palmetto Hilton Head Island, SC.................. 2,446,447 473,111 1,892,443 BI-LO James Island, SC........................ 379,829 1,519,423 Island Plaza James Island, SC........................ 2,820,729 11,283,031 38,392 Remount Village N. Charleston, SC....................... 3,779,830 1,470,352 5,879,355 Congress Crossing Athens, TN.............................. 1,098,351 6,747,013 84,281 St. Elmo Central Chattanooga, TN......................... 4,142,785 1,529,587 6,120,555 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Giant Eagle #637 Pittsburgh, PA.......................... 514,470 2,057,726 2,572,196 63,170 1982 Aug 93 Johnstown Galleria Richland Township, PA................... 1,584,716 6,338,788 7,923,504 191,106 1993 Jul 97 St Mary's Plaza St Mary's, PA........................... 977,711 4,048,402 5,026,113 533,299 1970 Dec 94 Northland Center State College, PA....................... 1,253,513 5,391,650 6,645,163 1,033,774 1988 Jun 92 Hampton Square Shopping Center Upper So Hampton, PA.................... 772,800 2,907,200 3,680,000 74,788 1980 Dec 98 Shops at Prospect West Hempfield, PA...................... 741,941 3,037,919 3,779,860 352,849 1994 Jul 95 York Marketplace York, PA................................ 3,199,353 14,658,090 17,857,443 1,684,203 1955 May 95 Circle Center Hilton Head Island, SC.................. 1,533,329 6,133,106 7,666,435 184,906 1989 Mar 94 Crossroads -- Palmetto Hilton Head Island, SC.................. 473,111 1,892,443 2,365,554 59,396 1994 Oct 95 BI-LO James Island, SC........................ 379,829 1,519,423 1,899,252 46,643 1982 Aug 93 Island Plaza James Island, SC........................ 2,820,729 11,321,423 14,142,152 340,391 1993-94 Oct 97 Remount Village N. Charleston, SC....................... 1,470,352 5,879,355 7,349,707 173,393 1996 Nov 96 Congress Crossing Athens, TN.............................. 1,098,351 6,831,294 7,929,645 1,367,386 1990 Mar 92 St. Elmo Central Chattanooga, TN......................... 1,529,587 6,120,555 7,650,142 180,493 1995 Aug 96 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Giant Eagle #637 Pittsburgh, PA.......................... 40 Years Johnstown Galleria Richland Township, PA................... 40 Years St Mary's Plaza St Mary's, PA........................... 40 Years Northland Center State College, PA....................... 40 Years Hampton Square Shopping Center Upper So Hampton, PA.................... 40 Years Shops at Prospect West Hempfield, PA...................... 40 Years York Marketplace York, PA................................ 40 Years Circle Center Hilton Head Island, SC.................. 40 Years Crossroads -- Palmetto Hilton Head Island, SC.................. 40 Years BI-LO James Island, SC........................ 40 Years Island Plaza James Island, SC........................ 40 Years Remount Village N. Charleston, SC....................... 40 Years Congress Crossing Athens, TN.............................. 40 Years St. Elmo Central Chattanooga, TN......................... 40 Years
F-46 75 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Winn-Dixie #1932 Chattanooga, TN......................... 591,450 2,365,576 Saddletree Village Collegedale, TN......................... 1,967,686 685,676 2,900,245 West Towne Square Shopping Center Elizabethton, TN........................ 529,103 3,880,088 25,139 Greeneville Commons Greeneville, TN......................... 1,075,200 7,884,800 23,156 Hazel Path Commons Hendersonville, TN...................... 919,231 3,677,158 Kimball Crossing Kimball, TN............................. 3,966,352 15,875,659 9,999 First American Bank/Audition Hi-Fi Kingsport, TN........................... 104,884 Chapman-Ford Crossing Knoxville, TN........................... 2,367,047 9,507,577 (39,285) Farrar Place Manchester, TN.......................... 804,963 3,220,060 Georgetown Square Murfreesboro, TN........................ 1,166,924 4,674,698 216,576 Apison Crossing Ooltewah, TN............................ 1,679,125 6,716,542 Madison Street Station Shelbyville, TN......................... 752,499 3,012,444 203,257 Commerce Central Tullahoma, TN........................... 8,890,812 3,043,798 12,177,046 Merchant's Central Winchester, TN.......................... 2,891,062 11,564,219 43,990 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Winn-Dixie #1932 Chattanooga, TN......................... 591,450 2,365,576 2,957,026 72,621 1995 Jul 96 Saddletree Village Collegedale, TN......................... 685,676 2,900,245 3,585,921 85,152 1990 Jun 98 West Towne Square Shopping Center Elizabethton, TN........................ 529,103 3,905,227 4,434,330 162,980 1970,1998 Jun 98 Greeneville Commons Greeneville, TN......................... 1,075,200 7,907,956 8,983,156 1,557,779 1990 Mar 92 Hazel Path Commons Hendersonville, TN...................... 919,231 3,677,158 4,596,389 110,860 1989 Nov 95 Kimball Crossing Kimball, TN............................. 3,966,352 15,885,658 19,852,010 469,114 1987 Nov 95 First American Bank/Audition Hi-Fi Kingsport, TN........................... 104,884 104,884 1970 Sep 92 Chapman-Ford Crossing Knoxville, TN........................... 2,367,047 9,468,292 11,835,339 285,657 1990 Dec 92 Farrar Place Manchester, TN.......................... 804,963 3,220,060 4,025,023 97,079 1990 Dec 95 Georgetown Square Murfreesboro, TN........................ 1,166,924 4,891,274 6,058,198 891,499 1986 Sep 93 Apison Crossing Ooltewah, TN............................ 1,679,125 6,716,542 8,395,667 202,494 1997 Jul 97 Madison Street Station Shelbyville, TN......................... 752,499 3,215,701 3,968,200 89,401 1985 Oct 95 Commerce Central Tullahoma, TN........................... 3,043,798 12,177,046 15,220,844 359,108 1995 Aug 96 Merchant's Central Winchester, TN.......................... 2,891,062 11,608,209 14,499,271 353,109 1997 Dec 97 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Winn-Dixie #1932 Chattanooga, TN......................... 40 Years Saddletree Village Collegedale, TN......................... 40 Years West Towne Square Shopping Center Elizabethton, TN........................ 40 Years Greeneville Commons Greeneville, TN......................... 40 Years Hazel Path Commons Hendersonville, TN...................... 40 Years Kimball Crossing Kimball, TN............................. 40 Years First American Bank/Audition Hi-Fi Kingsport, TN........................... 40 Years Chapman-Ford Crossing Knoxville, TN........................... 40 Years Farrar Place Manchester, TN.......................... 40 Years Georgetown Square Murfreesboro, TN........................ 40 Years Apison Crossing Ooltewah, TN............................ 40 Years Madison Street Station Shelbyville, TN......................... 40 Years Commerce Central Tullahoma, TN........................... 40 Years Merchant's Central Winchester, TN.......................... 40 Years
F-47 76 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ------------------------ ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ------------------------ ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- --------- ------------ ---------------- RETAIL Bardin Place Center Arlington, TX........................... 6,733,620 27,101,486 Kmart #7396 De Soto, TX............................. 529,521 2,118,084 Houston II Houston, TX............................. 71,600 286,239 Houston II Houston, TX............................. 56,200 224,959 Irving West SC Irving, TX.............................. 2,940,489 933,850 3,735,400 Kroger #506 Missouri City, TX....................... 390,012 1,560,274 El Chico (Ground Lease) Temple, TX.............................. 450,886 504,012 Valley Fair Master West Valley City, UT.................... 17,450,619 6,985,675 27,942,699 1,927,577 Shopping Center -- Colonial Hts Colonial Heights, VA.................... 290,000 792,441 Pizza Hut -- Pad Harrisonburg, VA........................ 427,500 Factory Merchants Ft Chiswell Max Meadows, VA......................... 411,023 1,644,017 1,128,622 Hanover Square Shopping Center Mechanicsville, VA...................... 1,778,701 7,114,805 210,309 Victorian Square Midlothian, VA.......................... 3,548,432 14,208,727 135,710 Va-Ky Regional SC Norton, VA.............................. 2,795,765 11,183,252 COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- --------- ------------ ---------- ------------ ------------ -------- RETAIL Bardin Place Center Arlington, TX........................... 6,733,620 27,101,486 33,835,106 808,535 1992-93 Oct 97 Kmart #7396 De Soto, TX............................. 529,521 2,118,084 2,647,605 65,022 1980 Aug 93 Houston II Houston, TX............................. 71,600 286,239 357,839 8,788 1985 Dec 92 Houston II Houston, TX............................. 56,200 224,959 281,159 6,905 1985 Dec 92 Irving West SC Irving, TX.............................. 933,850 3,735,400 4,669,250 117,240 1987 Sep 93 Kroger #506 Missouri City, TX....................... 390,012 1,560,274 1,950,286 47,897 1982 Aug 93 El Chico (Ground Lease) Temple, TX.............................. 450,886 504,012 954,898 15,294 1995 Dec 95 Valley Fair Master West Valley City, UT.................... 6,985,675 29,870,276 36,855,951 1,258,692 1970 Dec 96 Shopping Center -- Colonial Hts Colonial Heights, VA.................... 290,000 792,441 1,082,441 309,430 1972 May 86 Pizza Hut -- Pad Harrisonburg, VA........................ 427,500 427,500 41,732 1969 Jul 96 Factory Merchants Ft Chiswell Max Meadows, VA......................... 411,023 2,772,639 3,183,662 1,118,197 1989 Nov 93 Hanover Square Shopping Center Mechanicsville, VA...................... 1,778,701 7,325,114 9,103,815 1,369,835 1991 Jan 93 Victorian Square Midlothian, VA.......................... 3,548,432 14,344,437 17,892,869 2,093,993 1991 Mar 94 Va-Ky Regional SC Norton, VA.............................. 2,795,765 11,183,252 13,979,017 335,471 1989 Dec 92 COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Bardin Place Center Arlington, TX........................... 40 Years Kmart #7396 De Soto, TX............................. 40 Years Houston II Houston, TX............................. 40 Years Houston II Houston, TX............................. 40 Years Irving West SC Irving, TX.............................. 40 Years Kroger #506 Missouri City, TX....................... 40 Years El Chico (Ground Lease) Temple, TX.............................. 40 Years Valley Fair Master West Valley City, UT.................... 40 Years Shopping Center -- Colonial Hts Colonial Heights, VA.................... 35 Years Pizza Hut -- Pad Harrisonburg, VA........................ 35 Years Factory Merchants Ft Chiswell Max Meadows, VA......................... 40 Years Hanover Square Shopping Center Mechanicsville, VA...................... 40 Years Victorian Square Midlothian, VA.......................... 40 Years Va-Ky Regional SC Norton, VA.............................. 40 Years
F-48 77 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D - ----------------------------------------- ------------- ----------------------------- ---------------- COST CAPITALIZED SUBSEQUENT TO INITIAL COST TO COMPANY ACQUISITION ----------------------------- ---------------- BUILDING & DESCRIPTION ENCUMBERANCES LAND IMPROVEMENTS IMPROVEMENTS - ----------- ------------- ------------ -------------- ---------------- RETAIL Cave Spring Corners Shopping Center Roanoke, VA............................. 1,064,298 4,257,792 24,420 Hunting Hills Shopping Center Roanoke, VA............................. 4,164,775 1,897,007 6,010,376 9,047 Lakeside Plaza Salem, VA............................... 1,383,339 5,355,788 Shopping Center -- Spotsylvania Spotsylvania, VA........................ 250,000 1,363,880 260,466 Lake Drive Plaza Vinton, VA.............................. 3,727,118 1,432,155 4,616,848 147,496 Ridgeview Centre Wise, VA................................ 2,707,679 4,417,792 567,515 Moundsville Plaza Moundsville, WV......................... 228,283 1,989,798 5,139,516 Grand Central Plaza Parkersburg, WV......................... 4,358,333 153,150 Kmart Plaza Vienna, WV.............................. 664,121 2,656,483 143,331 ------------ ------------ -------------- ------------ $368,994,395 $552,145,683 $2,142,953,711 $185,545,637 ============ ============ ============== ============ COLUMN A COLUMN E COLUMN F COLUMN G COLUMN H - ----------------------------------------- ---------------------------------------------- ------------ ------------ -------- GROSS AMOUNT AT WHICH CARRIED AT THE CLOSE OF THE PERIOD ---------------------------------------------- BUILDING & ACCUMULATED DATE OF DATE DESCRIPTION LAND IMPROVEMENTS TOTAL DEPRECIATION CONSTRUCTION ACQUIRED - ----------- ------------ -------------- -------------- ------------ ------------ -------- RETAIL Cave Spring Corners Shopping Center Roanoke, VA............................. 1,064,298 4,282,212 5,346,510 270,890 1969 Jun 97 Hunting Hills Shopping Center Roanoke, VA............................. 1,897,007 6,019,423 7,916,430 257,599 1989 Apr 98 Lakeside Plaza Salem, VA............................... 1,383,339 5,355,788 6,739,127 81,963 1989 Apr 99 Shopping Center -- Spotsylvania Spotsylvania, VA........................ 250,000 1,624,346 1,874,346 563,965 1970 May 86 Lake Drive Plaza Vinton, VA.............................. 1,432,155 4,764,344 6,196,499 199,143 1976 Feb 98 Ridgeview Centre Wise, VA................................ 2,707,679 4,985,307 7,692,986 929,166 1990 Jul 92 Moundsville Plaza Moundsville, WV......................... 228,283 7,129,314 7,357,597 1,224,078 1961 Dec 88 Grand Central Plaza Parkersburg, WV......................... 4,511,483 4,511,483 1,315,139 1986 Jun 88 Kmart Plaza Vienna, WV.............................. 664,121 2,799,814 3,463,935 469,066 1975 Feb 93 ------------ -------------- -------------- ------------ $552,145,683 $2,328,499,348 $2,880,645,031 $216,274,187 ============ ============== ============== ============ COLUMN A COLUMN I - ----------------------------------------- ---------------- LIFE ON WHICH DEPRECIATED IN LATEST DESCRIPTION INCOME STATEMENT - ----------- ---------------- RETAIL Cave Spring Corners Shopping Center Roanoke, VA............................. 40 Years Hunting Hills Shopping Center Roanoke, VA............................. 40 Years Lakeside Plaza Salem, VA............................... 40 Years Shopping Center -- Spotsylvania Spotsylvania, VA........................ 35 Years Lake Drive Plaza Vinton, VA.............................. 40 Years Ridgeview Centre Wise, VA................................ 40 Years Moundsville Plaza Moundsville, WV......................... 40 Years Grand Central Plaza Parkersburg, WV......................... 40 Years Kmart Plaza Vienna, WV.............................. 40 Years
F-49 78 NEW PLAN EXCEL REALTY TRUST, INC. AND SUBSIDIARIES SCHEDULE III -- REAL ESTATE AND ACCUMULATED DEPRECIATION (IN THOUSANDS)
YEAR ENDED FIVE MONTHS ENDED YEAR ENDED DECEMBER 31, DECEMBER 31, JULY 31, 1999 1998 1998 ------------ ----------------- ---------- [a] Reconciliation of total real estate carrying value is as follows: Balance at beginning of year.................. $2,825,469 $1,452,738 $1,277,775 Acquisitions and improvements................. 75,480 40,057 174,963 Allocation of purchase price.................. 4,000 1,332,714 -- Cost of property sold......................... (24,304) (40) -- ---------- ---------- ---------- Balance at end of year........................ $2,880,645 $2,825,469 $1,452,738 ========== ========== ========== Total cost for federal income tax purposes at the end of each year........................ $2,491,717 $2,478,694 $1,452,738 ========== ========== ========== [b] Reconciliation of accumulated depreciation is as follows: Balance at beginning of year.................. $ 158,021 $ 136,978 $ 105,866 Depreciation expense.......................... 62,163 21,043 31,112 Deletions -- property sold.................... (3,910) -- -- ---------- ---------- ---------- Balance at end of year........................ $ 216,274 $ 158,021 $ 136,978 ========== ========== ==========
F-50 79 NEW PLAN EXCEL REALTY TRUST AND SUBSIDIARIES MORTGAGE LOANS ON REAL ESTATE (AMOUNTS IN THOUSANDS) SCHEDULE IV DECEMBER 31, 1999
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F COLUMN G - ------------------------ -------- --------- ------------------------------ -------- --------- --------- FINAL FACE FACE CARRYING INTEREST MATURITY PERIODIC PRIOR AMOUNT OF AMOUNT OF DESCRIPTION RATE DATE PAYMENT TERMS LIENS MORTGAGES MORTGAGES ----------- -------- --------- ------------------------------ -------- --------- --------- Purchase money first mortgage, collateralized by a shopping center in Interest payable monthly, Connellsville, PA....... 10% 8/31/2000 balance at maturity $ 5,420 $ 5,180 Purchase money first mortgage, collateralized by a shopping center in Interest payable monthly, Whitesboro, NY.......... 9.38% 7/31/2000 balance at maturity 4,610 4,205 Leasehold mortgage, collateralized by a tenant lease in Columbus Center in Columbus, Interest and principal payable IN...................... 11.5% 4/30/2004 monthly 259 172 Leasehold mortgage, collateralized by a tenant lease in D&F Interest and principal payable Plaza in Dunkirk, NY.... 12% 5/1/2008 monthly 1,000 820 Purchase money first mortgage, collateralized by a shopping center in Interest payable monthly, Harrisonburg, VA........ 9% 7/22/2000 balance at maturity 794 149 Purchase money first mortgage, collateralized by a shopping center in Interest payable quarterly and New Bern, NC............ 7.2% 5/9/2001 principal payable at maturity 750 750 Purchase money first mortgage collateralized by shopping center in Interest payable monthly and Hanover, PA............. 8.75% 7/23/2001 principal payable at maturity 700 454 Leasehold mortgage collateralized by a tenant lease in Shops @ Seneca in Liverpool, Interest and principal payable NY...................... 10% 5/31/2008 monthly 1,823 1,658 ------- ------- $15,356 $13,388 ======= =======
- --------------- Note: Column H is not applicable F-51 80 NEW PLAN EXCEL REALTY TRUST AND SUBSIDIARIES MORTGAGE LOANS ON REAL ESTATE (AMOUNTS IN THOUSANDS) SCHEDULE IV (CONTINUED)
YEAR ENDED ----------------------------------------------------- DECEMBER 31, 1999 DECEMBER 31, 1998 JULY 31, 1998 ----------------- ----------------- ------------- Balance, beginning of period................... $13,399 $13,878 $ 23,107 Additions during period: New loans.................................... 5,168 307 1,322 Reductions during period: Collection of principal...................... (5,179) (786) (10,551) ------- ------- -------- Balance, end of period......................... $13,388 $13,399 $ 13,878 ======= ======= ========
F-52 81 SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. NEW PLAN EXCEL REALTY TRUST, INC. (Registrant) By: /s/ GLENN J. RUFRANO ---------------------------------- Glenn J. Rufrano President and Chief Executive Officer Dated: March 21, 2000 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
SIGNATURE TITLE DATE --------- ----- ---- /s/ WILLIAM NEWMAN Chairman of the Board of March 21, 2000 - --------------------------------------------------- Directors William Newman /s/ GLENN J. RUFRANO President and Chief Executive March 21, 2000 - --------------------------------------------------- Officer Glenn J. Rufrano /s/ JAMES M. STEUTERMAN Executive Vice President, Chief March 21, 2000 - --------------------------------------------------- Operating Officer and Director James M. Steuterman /s/ MICHAEL I. BROWN Controller and Chief Accounting March 21, 2000 - --------------------------------------------------- Officer (principal financial Michael I. Brown officer) /s/ DEAN BERNSTEIN Senior Vice President -- Finance March 21, 2000 - --------------------------------------------------- and Multifamily and Director Dean Bernstein /s/ RAYMOND H. BOTTORF Director March 21, 2000 - --------------------------------------------------- Raymond H. Bottorf /s/ NORMAN GOLD Director March 21, 2000 - --------------------------------------------------- Norman Gold /s/ ARNOLD LAUBICH Director March 21, 2000 - --------------------------------------------------- Arnold Laubich /s/ MELVIN NEWMAN Director March 21, 2000 - --------------------------------------------------- Melvin Newman
82
SIGNATURE TITLE DATE --------- ----- ---- /s/ BRUCE A. STALLER Director March 21, 2000 - --------------------------------------------------- Bruce A. Staller /s/ JOHN WETZLER Director March 21, 2000 - --------------------------------------------------- John Wetzler /s/ GREGORY WHITE Director March 21, 2000 - --------------------------------------------------- Gregory White
83 EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION - ------- ----------- *3.1 Articles of Amendment and Restatement of the Charter of the Company filed as Exhibit 3.01 to Amendment No. 1 to the Company's Registration Statement on Form S-3, File No. 33-59195. *3.2 Articles of Amendment of Articles of Amendment and Restatement of the Charter of the Company filed as Exhibit 4.4 to the Company's Registration Statement on Form S-3, File No. 333-65211. *3.3 Amended and Restated Bylaws of the Company filed as Exhibit 4.6 to the Company's Registration Statement on Form S-3, File No. 333-65211. *3.4 Amendments to the Bylaws of the Company, dated April 21, 1999, filed as Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q/A for the quarter ended June 30, 1999. *3.5 Amendments to the Bylaws of the Company, dated June 3, 1999, filed as Exhibit 3.2 to the Company's Quarterly Report on Form 10-Q/A for the quarter ended June 30, 1999. 3.6 Amendments to the Bylaws of the Company, dated February 7, 2000. *4.1 Articles Supplementary classifying 4,600,000 shares of preferred stock as 8 1/2% Series A Cumulative Convertible Preferred Stock filed as Exhibit 4.01 to the Company's Current Report on Form 8-K dated February 7, 1997. *4.2 Articles Supplementary classifying 690,000 shares of preferred stock as 8 5/8% Series B Cumulative Redeemable Preferred Stock filed as Exhibit 4.02 to the Company's Current Report on Form 8-K dated January 14, 1998. *4.3 Articles Supplementary relating to the Series C Junior Participating Preferred Stock of the Company, which may in the future be issued under the Company's Rights Plan filed as Exhibit 4.3 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *4.4 Articles Supplementary classifying 150,000 shares of preferred stock as 7.80% Series D Cumulative Voting Step-Up Premium Rate Preferred Stock filed as Exhibit 4.5 to the Company's Registration Statement on Form S-3, File No. 333-65211. *10.1 Amended and Restated 1993 Stock Option Plan of the Company filed as Exhibit 4.1 to the Company's Registration Statement on Form S-8, File No. 333-65223. *10.2 Amendment to the Amended and Restated 1993 Stock Option Plan of the Company, dated May 28, 1998, dated September 28, 1998, filed as Exhibit 10.4 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *10.3 Amendment to the Amended and Restated 1993 Stock Option Plan of the Company, dated February 8, 1999, filed as Exhibit 10.5 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. 10.4 Amendment to the Amended and Restated 1993 Stock Option Plan of the Company, dated April 21, 1999. 10.5 Amendment to the Amended and Restated 1993 Stock Option Plan of the Company, dated February 17, 2000. *10.6 Directors' Amended and Restated 1994 Stock Option Plan of the Company, dated May 10, 1996, filed as Exhibit 10.8 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *10.7 Amendment to the Amended and Restated 1994 Directors' Stock Option Plan of the Company, dated September 28, 1998, filed as Exhibit 10.9 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. 10.8 Amendment to the Amended and Restated 1994 Directors' Stock Option Plan of the Company, dated February 17, 2000.
84
EXHIBIT NO. DESCRIPTION - ------- ----------- *10.9 New Plan Realty Trust 1997 Stock Option Plan filed as Exhibit 4.1 to the Company's Registration Statement on Form S-8, File No. 333-65221. *10.10 New Plan Realty Trust 1991 Stock Option Plan, as amended, filed as Exhibit 4.2 to the Company's Registration Statement on Form S-8, File No. 333-65221. *10.11 Amended and Restated New Plan Realty Trust 1985 Incentive Stock Option Plan filed as Exhibit 4.3 to the Company's Registration Statement on Form S-8, File No. 333-65221. *10.12 New Plan Realty Trust March 1991 Stock Option Plan and Non-Qualified Stock Option Plan filed as Exhibit 4.4 to the Company's Registration Statement on Form S-8, File No. 333-65221. 10.13 Credit Agreement, dated as of November 17, 1999, by and among New Plan Excel Realty Trust, Inc., the lenders party thereto, The Bank of New York, as administrative agent, and Bank One, NA and BankBoston, N.A., each as co-documentation agent. 10.14 Guaranty, dated as of November 17, 1999, by and among New Plan Realty Trust, Excel Realty Trust -- ST, Inc. and The Bank of New York, as administrative agent. 10.15 Credit Agreement, dated as of November 17, 1999, by and among New Plan Excel Realty Trust, Inc., the lenders party thereto, The Bank of New York, as administrative agent, and Bank One, NA and BankBoston, N.A., each as co-documentation agent. 10.16 Guaranty, dated as of November 17, 1999, by and among New Plan Realty Trust, Excel Realty Trust -- ST, Inc. and The Bank of New York, as administrative agent. *10.17 Indenture, dated as of May 8, 1995, between the Company and State Street Bank and Trust Company of California, N.A. (as successor to the First National Bank of Boston) filed as Exhibit 4.01 to the Company's Registration Statement on Form S-3, File No. 33-59195, as amended, on May 9, 1995. *10.18 First Supplemental Indenture, dated as of April 4, 1997, between the Company and State Street Bank and Trust Company of California, N.A. filed as Exhibit 4.02 to the Company's Registration Statement on Form S-3, File No. 333-24615, as amended, on April 4, 1997. *10.19 Second Supplemental Indenture, dated as of July 3, 1997, between the Company and State Street Bank and Trust Company of California, N.A. filed as Exhibit 4.01 to the Company's Current Report on Form 8-K dated July 3, 1997. *10.20 Senior Securities Indenture, dated as of March 29, 1995, between New Plan Realty Trust and The First National Bank of Boston, as Trustee filed as Exhibit 4.2 to New Plan Realty Trust's Registration Statement on Form S-3, File No. 33-60045. *10.21 First Supplemental Indenture, dated as of August 5, 1999, by and among New Plan Realty Trust, New Plan Excel Realty Trust, Inc. and State Street Bank and Trust Company filed as Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999. *10.22 Senior Securities Indenture, dated as of February 3, 1999, among the Company, New Plan Realty Trust, as guarantor, and State Street Bank and Trust Company, as Trustee, filed as Exhibit 4.1 to the Company's Current Report on Form 8-K dated February 3, 1999. *10.23 Amended and Restated Agreement of Limited Partnership of Excel Realty Partners, L.P., dated as of June 25, 1997, filed as Exhibit 10.20 to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997. *10.24 First Amendment to Amended and Restated Agreement of Limited Partnership of Excel Realty Partners, L.P., dated as of August 20, 1999, by and among New Plan DRP Trust, New Plan Excel Realty Trust, Inc. and the current and future partners in the partnership filed as Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1999. *10.25 Master Separation Agreement, dated as of April 21, 1999, among New Plan Excel Realty Trust, Inc., ERT Development Corporation and Excel Legacy Corporation filed as Exhibit 10.1 to the Company's Current Report on Form 8-K dated April 22, 1999.
85
EXHIBIT NO. DESCRIPTION - ------- ----------- *10.26 Resignation and Release Agreement, dated as of April 21, 1999, entered into between the Company and Gary B. Sabin filed as Exhibit 10.2 to the Company's Current Report on Form 8-K dated April 22, 1999. *10.27 Resignation and Release Agreement, dated as of April 21, 1999, entered into between the Company and Richard B. Muir filed as Exhibit 10.3 to the Company's Current Report on Form 8-K dated April 22, 1999. *10.28 Agreement and Plan of Merger, dated May 14, 1998, as amended as of August 7, 1998, among the Company, ERT Merger Sub, Inc. and New Plan Realty Trust filed, as Exhibit 2.1 to the Company's Registration Statement on Form S-4, File No. 333-61131. *10.29 Rights Agreement, dated as of May 15, 1998, between the Company and BankBoston, N.A., filed as Exhibit 4 to the Company's Report on Form 8-A dated May 19, 1998. *10.30 First Amendment to Rights Agreement, dated as of February 8, 1999, between the Company and BankBoston, N.A. filed as Exhibit 4.1 to the Company's Report on Form 8-A/A (Amendment No. 1) dated May 5, 1999. *10.31 Dividend Reinvestment and Share Purchase Plan filed as Exhibit 4.7 to the Company's Registration Statement on Form S-3, File No. 333-65211. *10.32 Employment Agreement, dated as of September 17, 1998, by and between the Company and William Newman, filed as Exhibit 10.39 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *10.33 Employment Agreement, dated as of February 23, 2000, by and between the Company and Glenn J. Rufrano, filed as Exhibit 10.1 to the Company's Current Report on Form 8-K, dated March 9, 2000. *10.34 Employment Agreement, dated as of September 25, 1998, by and between the Company and James M. Steuterman, filed as Exhibit 10.43 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. *10.35 Employment Agreement, dated as of September 25, 1998, by and between the Company and Steven F. Siegel, filed as Exhibit 10.45 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. 10.36 Employment Agreement, dated as of September 25, 1998, by and between the Company and James DeCicco. *10.37 Support Agreement, dated as of May 14, 1998, by William Newman to the Company, filed as Exhibit 10.7 to the Company's Registration Statement on Form S-4, File No. 333-61131, dated August 11, 1998. *10.38 Agreement, dated as of February 23, 2000, by and between the Company and Arnold Laubich, filed as Exhibit 10.9 to the Company's Current Report on Form 8-K, dated March 9, 2000. 10.39 Unconditional Guaranty of Payment and Performance, dated as of January 28, 2000, by the Company (Pointe Orlando). *10.40 Unconditional Guaranty of Payment and Performance, dated as of January 13, 1997, by the Company (Briar Preston Ridge), filed as Exhibit 10.49 to the Company's Annual Report on Form 10-K/A for the year ended December 31, 1998. 10.41 Term Loan Agreement, dated as of March 7, 2000, between the Company and Fleet National Bank 10.42 Guaranty, dated as of March 7, 2000, by the Trust and Excel Realty Trust -- ST, Inc. 12 Ratio of Earnings to Fixed Charges.
86
EXHIBIT NO. DESCRIPTION - ------- ----------- 21 Subsidiaries of the Registrant. 23 Consent of PricewaterhouseCoopers LLP. 27(1) Financial Data Schedule.
- --------------- * Incorporated herein by reference as above indicated. (1) Filed as exhibit to electronic filing only. EX-3.6 2 AMENDMENTS TO BYLAWS DATED FEBRUARY 7, 2000 1 EXHIBIT 3.6 NEW PLAN EXCEL REALTY TRUST, INC. PROPOSED AMENDMENT TO THE AMENDED AND RESTATED BYLAWS 1. Article IV of the Amended and Restated Bylaws hereby is amended by deleting such Article in its entirety and inserting the following in its place: "Section 1. Number, Tenure and Qualifications. The Board of Directors may appoint from among its members committees composed of two or more directors, to serve at the pleasure of the Board of Directors. In addition, the Board of Directors may establish additional committees composed of directors and members of management of the Corporation. Section 2. Powers. The Board of Directors may delegate to committees appointed under Section 1 of this Article any of the powers of the Board of Directors, except as prohibited by law. Section 3. Telephone Meetings. Members of a committee appointed under Section 1 of this Article may participate in a meeting by means of a conference telephone or similar communications equipment if all persons participating in the meeting can hear each other at the same time. Participation in a meeting by these means shall constitute presence in person at the meeting. Section 4. Informal Action by Committees. Any action required or permitted to be taken at any meeting of a committee appointed under Section 1 of this Article may be taken without a meeting if a consent in writing to such action is signed by each member of the committee and such written consent is filed with the minutes of proceedings of such committee." 2 NEW PLAN EXCEL REALTY TRUST, INC. PROPOSED AMENDMENT TO THE AMENDED AND RESTATED BYLAWS 1. Article III, Section 5 of the Amended and Restated Bylaws hereby is amended by deleting such section in its entirety and inserting the following in its place: "Section 5. Notice. Notice of any meeting of the Board of Directors shall be given to each director either (i) verbally, delivered personally or by telephone, or (ii) in writing, delivered personally or transmitted by facsimile to the director's business address. Such notice shall be given at least three (3) business days prior to such meeting. Neither the business to be transacted at, nor the purpose of, any annual or regular meeting of the Board of Directors need be stated in this notice, unless specifically required by statute or these bylaws. No business shall be transacted at a special meeting of the Board of Directors except as specifically designated in the notice thereof." EX-10.4 3 AMENDMENT TO THE 1993 STOCK OPTION PLAN APRIL 2000 1 EXHIBIT 10.4 AMENDMENT TO THE 1993 STOCK OPTION PLAN OF NEW PLAN EXCEL REALTY TRUST, INC. (AMENDED AND RESTATED MAY 28, 1998) (SUBSEQUENTLY AMENDED SEPTEMBER 28, 1998 AND FEBRUARY 8, 1999) WHEREAS, New Plan Excel Realty Trust, Inc. ("Company") previously adopted the 1993 Stock Option Plan of Excel Realty Trust, Inc. ("Plan"); and WHEREAS, pursuant to the Plan, the Stock Option Committee of the Board of Directors has reserved the right to amend the Plan; and WHEREAS, the Executive Compensation and Stock Option Committee of the Board of Directors of the Company serves as the Stock Option Committee of the Plan ("Committee"); and WHEREAS, the Committee amended the Plan September 28, 1998 and February 8, 1999; and WHEREAS, the Committee desires to amend the Plan. NOW, THEREFORE, the Plan is hereby amended effective April 21, 1999 as follows: 1. The text of subsection (c) of Section 4.3 - Commencement of Exercisability is deleted in its entirety, and the following is substituted therefor: "Except as the Committee may otherwise provide, no portion of an Option which is unexercisable at Termination of Employment shall thereafter become exercisable." 2. The text of Section 4.4 - Expiration of Options is deleted in its entirety, and the following is substituted therefor: "(a) Except as the Committee may otherwise provide, no Option may be exercised to any extent by anyone after the first to occur of the following events: (1) The expiration of ten years from the date the Option was granted; or 2 (2) With respect to an Incentive Stock Option in the case of an Optionee owning (within the meaning of Section 424(d) of the Code), at the time the Incentive Stock Option was granted, more than 10% of the total combined voting power of all classes of stock of the Company, any Subsidiary or any parent corporation, the expiration of five years from the date the Incentive Stock Option was granted; or (3) Except in the case of any Optionee who is disabled (within the meaning of Section 22(e)(3) of the Code), the expiration of three months from the date of the Optionee's Termination of Employment for any reason other than such Optionee's death unless the Optionee dies within said three-month period; or (4) In the case of an Optionee who is disabled (within the meaning of Section 22(e)(3) of the Code), the expiration of one year from the date of the Optionee's Termination of Employment for any reason other than such Optionee's death unless the Optionee dies within said one-year period; or (5) The expiration of one year from the date of the Optionee's death. (b) The Committee shall provide, in the terms of each individual Option, when such Option expires and becomes unexercisable; and (without limiting the generality of the foregoing) the Committee may provide in the terms of individual Options that said Options expire immediately upon a Termination of Employment for any reason." 3. In all other respects the Plan, as amended, shall continue in full force and effect. 2 EX-10.5 4 AMENDMENT TO THE 1993 STOCK OPTION PLAN FEB.2000 1 EXHIBIT 10.5 AMENDMENT TO THE 1993 STOCK OPTION PLAN OF NEW PLAN EXCEL REALTY TRUST, INC. (AMENDED AND RESTATED MAY 28, 1998) (SUBSEQUENTLY AMENDED SEPTEMBER 28, 1998, FEBRUARY 8, 1999 AND APRIL 21,1999) WHEREAS, New Plan Excel Realty Trust, Inc. ("Company") previously adopted the 1993 Stock Option Plan of Excel Realty Trust, Inc. ("Plan"); and WHEREAS, pursuant to the Plan, the Stock Option Committee of the Board of Directors has reserved the right to amend the Plan; and WHEREAS, the Executive Compensation and Stock Option Committee of the Board of Directors of the Company serves as the Stock Option Committee of the Plan ('Committee"); and WHEREAS, the Committee amended the Plan September 28, 1998, February 8, 1999 and April 21, 1999; and WHEREAS, the Committee desires to amend the Plan. NOW, THEREFORE, the Plan is hereby amended effective February 17, 2000 as follows: 1. The text of subsection (b) of Section 4.2 - Option Price is deleted in its entirety, and the following is substituted therefor: "For purposes of the Plan, unless the Committee determines otherwise, the fair market value of a share of the Company's Common Stock as of a given date shall be: (i) the closing price of a share of the Company's Common Stock on the principal exchange on which shares of the Company's Common Stock are then trading, if any, on the trading day previous to such date, or, if shares were not traded on the day previous to such date, then on the next preceding trading day during which a sale occurred; or (ii) if such Common Stock is not traded on an exchange but is quoted on NASDAQ or a successor quotation system, (1) the last sales price (if the Company's Common Stock is then listed as a National Market Issue under the NASD National Market System) or (2) the mean between the closing representative bid and asked prices (in all other cases) for the Company's Common Stock on the trading day previous to such date as reported by NASDAQ or such successor quotation system; or (iii) if such Common Stock is not publicly traded on an 2 exchange and not quoted on NASDAQ or a successor quotation system, the mean between the closing bid and asked prices for the Company's Common Stock, on the trading day previous to such date, as determined in good faith by the Committee; or (iv) if the Company's Common Stock is not publicly traded, the fair market value established by the Committee acting in good faith." 2. The first sentence of Section 4.5 - Consideration is deleted in its entirety, and the following is substituted therefor: "Unless otherwise determined by the Committee, the Optionee, in consideration of the granting of an Option, shall agree, in the written Stock Option Agreement, to remain in the employ of the Company or a Subsidiary for a period of at least one year after the Option is granted." 3. The text of subsection (b)(3) of Section 5.3 - Manner of Exercise is deleted in its entirety, and the following is substituted therefor: "With the consent of the Committee, a recourse, nonrecourse or limited recourse promissory note, as determined by the Committee, bearing interest (at no less than such rate as shall then preclude the imputation of interest under the Code or any successor provision) and payable upon such terms as may be prescribed by the Committee. The Committee may also prescribe the form of such note and the security to be given for such note. No Option may, however, be exercised by delivery of a promissory note or by a loan from the Company when or where such loan or other extension of credit is prohibited by law; or 4. In all other respects the Plan, as amended, shall continue in full force and effect. 2 EX-10.8 5 AMENDED 1994 DIRECTORS' STOCK OPTION PLAN 1 EXHIBIT 10.8 AMENDMENT TO THE NEW PLAN EXCEL REALTY TRUST, INC. DIRECTORS', 1994 STOCK OPTION PLAN (AMENDED AND RESTATED MAY 10, 1996) WHEREAS, New Plan Excel Realty Trust, Inc. ("Company") previously adopted the New Plan Excel Realty Trust, Inc. Directors' 1994 Stock Option Plan ("Plan"); and WHEREAS, pursuant to the Plan, the Board of Directors has reserved the right to amend the Plan; and WHEREAS, the Board of Directors of the Company desires to amend the Plan. NOW, THEREFORE, the Plan is hereby amended effective February 17, 2000 as follows: 1. The text of subsection (e) of Section 6 OPTION PROVISIONS is deleted in its entirety, and the following is substituted therefor: "Any option holder who ceases to be a director, whether because of death, resignation, removal, expiration of his or her term of office or any other reason, shall have the right to exercise the option for thirty (30) days after such event (but not after the expiration date of the option), at which time the option shall terminate and may no longer be exercised, except (i) in the event of the death of an option holder (x) who is at the time of his or her death a director of the Company and who has served as a director since the date of grant of the option, the option may be exercised at any time within one year following the date of death (but not after the expiration date of the option), by the option holder's estate or by a person who acquired the right to exercise the option by bequest or inheritance, or (y) within thirty (30) days after the termination of the option holder's status as a director of the Company, the option may be exercised at any time within six (6) months after the date of death (but in no event after the expiration date of the option) by the option holder's estate or by a person who acquired the right to exercise the option by bequest or inheritance, (ii) upon the option holder's ceasing to be a director by reason of disability he or she (or his or her guardian) shall have the right to exercise the option within one year after the date the option holder ceased to be a director (but not after the expiration date of the option); and (iii) as otherwise provided by the Committee." 2. In all other respects the Plan, as amended, shall continue in full force and effect. EX-10.13 6 CREDIT AGREEMENT 1 EXHIBIT 10.13 FACILITY I ================================================================================ CREDIT AGREEMENT by and among NEW PLAN EXCEL REALTY TRUST, INC. THE LENDERS PARTY HERETO, AND THE BANK OF NEW YORK as Administrative Agent BANK ONE, NA as a Co-Documentation Agent and BANKBOSTON, N.A. as a Co-Documentation Agent Dated as of November 17, 1999 BNY CAPITAL MARKETS, INC. as Sole Lead Arranger and Bookrunner ================================================================================ 2 TABLE OF CONTENTS 1. DEFINITIONS..............................................................................................1 1.1. DEFINED TERMS....................................................................................1 1.2. OTHER DEFINITIONAL PROVISIONS...................................................................24 2. AMOUNT AND TERMS OF LOANS...............................................................................24 2.1. LOANS...........................................................................................24 2.2. NOTES...........................................................................................25 2.3. PROCEDURE FOR REVOLVING CREDIT LOAN BORROWINGS OTHER THAN COMPETITIVE BID BORROWINGS. 26 2.4. COMPETITIVE BID BORROWINGS AND PROCEDURE FOR COMPETITIVE BID BORROWINGS.........................28 2.5. TERMINATION OR REDUCTION OF COMMITMENTS.........................................................32 2.6. REPAYMENT OF LOANS; EVIDENCE OF DEBT............................................................33 2.7. PREPAYMENTS OF THE LOANS........................................................................34 2.8. CONVERSIONS.....................................................................................34 2.9. INTEREST RATE AND PAYMENT DATES.................................................................35 2.10. SUBSTITUTED INTEREST RATE.......................................................................37 2.11. TAXES; NET PAYMENTS.............................................................................38 2.12. ILLEGALITY......................................................................................38 2.13. INCREASED COSTS.................................................................................39 2.14. INDEMNIFICATION FOR BREAK FUNDING LOSSES........................................................40 2.15. USE OF PROCEEDS.................................................................................41 2.16. CAPITAL ADEQUACY................................................................................42 2.17. ADMINISTRATIVE AGENT'S RECORDS..................................................................42 2.18. EXTENSION OF REVOLVING CREDIT TERMINATION DATE..................................................43 3. FEES; PAYMENTS..........................................................................................43 3.1. FACILITY FEE....................................................................................43 3.2. PAYMENTS; APPLICATION OF PAYMENTS...............................................................44 4. REPRESENTATIONS AND WARRANTIES..........................................................................45 4.1. EXISTENCE AND POWER.............................................................................45 4.2. AUTHORITY.......................................................................................45 4.3. BINDING AGREEMENT...............................................................................45 4.4. SUBSIDIARIES; DOWNREIT PARTNERSHIPS.............................................................46 4.5. LITIGATION......................................................................................46 4.6. REQUIRED CONSENTS...............................................................................47 4.7. NO CONFLICTING AGREEMENTS.......................................................................47 4.8. COMPLIANCE WITH APPLICABLE LAWS.................................................................47 4.9. TAXES...........................................................................................47 4.10. GOVERNMENTAL REGULATIONS........................................................................48 4.11. FEDERAL RESERVE REGULATIONS; USE OF LOAN PROCEEDS...............................................48 4.12. PLANS; MULTIEMPLOYER PLANS......................................................................48 4.13. FINANCIAL STATEMENTS............................................................................49 4.14. PROPERTY........................................................................................49 4.15. FRANCHISES, INTELLECTUAL PROPERTY, ETC..........................................................49
3 4.16. ENVIRONMENTAL MATTERS...........................................................................50 4.17. LABOR RELATIONS.................................................................................51 4.18. BURDENSOME OBLIGATIONS..........................................................................51 4.19. SOLVENCY........................................................................................52 4.20. REIT STATUS.....................................................................................52 4.21. RENT ROLL AND LIST OF UNENCUMBERED ASSETS.......................................................52 4.22. YEAR 2000.......................................................................................52 4.23. OPERATION OF BUSINESS...........................................................................53 4.24. NO MISREPRESENTATION............................................................................53 5. CONDITIONS TO FIRST LOANS...............................................................................53 5.1. EVIDENCE OF ACTION..............................................................................53 5.2. THIS AGREEMENT..................................................................................54 5.3. NOTES...........................................................................................54 5.4. GUARANTY........................................................................................54 5.5. OTHER CREDIT AGREEMENT..........................................................................54 5.6. LITIGATION......................................................................................55 5.7. OPINION OF COUNSEL TO THE BORROWER..............................................................55 5.8. FEES............................................................................................55 5.9. FEES AND EXPENSES OF SPECIAL COUNSEL............................................................55 5.10. YEAR 2000 ASSURANCES............................................................................55 6. CONDITIONS OF LENDING - ALL LOANS.......................................................................56 6.1. COMPLIANCE......................................................................................56 6.2. LOAN CLOSINGS...................................................................................56 6.3. BORROWING REQUEST; TERM LOAN CONVERSION NOTICE..................................................56 6.4. DOCUMENTATION AND PROCEEDINGS...................................................................56 6.5. REQUIRED ACTS AND CONDITIONS....................................................................57 6.6. APPROVAL OF SPECIAL COUNSEL.....................................................................57 6.7. SUPPLEMENTAL OPINIONS...........................................................................57 6.8. OTHER DOCUMENTS.................................................................................57 7. AFFIRMATIVE COVENANTS...................................................................................57 7.1. FINANCIAL STATEMENTS............................................................................58 7.2. CERTIFICATES; OTHER INFORMATION.................................................................59 7.3. LEGAL EXISTENCE.................................................................................62 7.4. TAXES...........................................................................................63 7.5. INSURANCE.......................................................................................63 7.6. PAYMENT OF INDEBTEDNESS AND PERFORMANCE OF OBLIGATIONS..........................................63 7.7. MAINTENANCE OF PROPERTY; ENVIRONMENTAL INVESTIGATIONS...........................................64 7.8. OBSERVANCE OF LEGAL REQUIREMENTS................................................................64 7.9. INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS..........................................65 7.10. LICENSES, INTELLECTUAL PROPERTY.................................................................65 7.11. REQUIRED ADDITIONAL GUARANTORS..................................................................65 7.12. REIT STATUS; OPERATION OF BUSINESS..............................................................65 7.13. TERMINATION OF EXISTING CREDIT AGREEMENTS.......................................................66 8. NEGATIVE COVENANTS......................................................................................66 8.1. LIENS...........................................................................................66 8.2. MERGER, CONSOLIDATION AND CERTAIN DISPOSITIONS OF PROPERTY......................................67 8.3. INVESTMENTS, LOANS, ETC.........................................................................68
- 2 - 4 8.4. BUSINESS CHANGES................................................................................69 8.5. AMENDMENTS TO ORGANIZATIONAL DOCUMENTS..........................................................70 8.6. BANKRUPTCY PROCEEDINGS..........................................................................70 8.7. SALE AND LEASEBACK..............................................................................70 8.8. TRANSACTIONS WITH AFFILIATES....................................................................70 8.9. ISSUANCE OF ADDITIONAL CAPITAL STOCK BY SUBSIDIARY GUARANTORS...................................70 8.10. HEDGING AGREEMENTS..............................................................................71 8.11. RESTRICTED PAYMENTS.............................................................................71 8.12. UNENCUMBERED ASSETS COVERAGE RATIO..............................................................72 8.13. FIXED CHARGE COVERAGE RATIO.....................................................................72 8.14. MINIMUM TANGIBLE NET WORTH......................................................................72 8.15. MAXIMUM TOTAL INDEBTEDNESS......................................................................72 8.16. LIABILITIES TO ASSETS RATIO.....................................................................72 8.17. MAXIMUM BOOK VALUE OF ANCILLARY ASSETS..........................................................72 9. DEFAULT.................................................................................................73 9.1. EVENTS OF DEFAULT...............................................................................73 10. THE AGENT...............................................................................................76 10.1. APPOINTMENT.....................................................................................76 10.2. DELEGATION OF DUTIES............................................................................77 10.3. EXCULPATORY PROVISIONS..........................................................................77 10.4. RELIANCE BY ADMINISTRATIVE AGENT................................................................77 10.5. NOTICE OF DEFAULT...............................................................................78 10.6. NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS..........................................78 10.7. INDEMNIFICATION.................................................................................79 10.8. ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.................................................79 10.9. SUCCESSOR ADMINISTRATIVE AGENT..................................................................80 11. OTHER PROVISIONS........................................................................................81 11.1. AMENDMENTS AND WAIVERS..........................................................................81 11.2. NOTICES.........................................................................................82 11.3. NO WAIVER; CUMULATIVE REMEDIES..................................................................83 11.4. SURVIVAL OF REPRESENTATIONS AND WARRANTIES......................................................83 11.5. PAYMENT OF EXPENSES AND TAXES...................................................................84 11.6. LENDING OFFICES.................................................................................85 11.7. SUCCESSORS AND ASSIGNS..........................................................................85 11.8. DESIGNATED LENDER...............................................................................88 11.9. COUNTERPARTS....................................................................................88 11.10. ADJUSTMENTS; SET-OFF............................................................................89 11.11. LENDERS' REPRESENTATIONS........................................................................90 11.12. INDEMNITY.......................................................................................90 11.13. GOVERNING LAW...................................................................................91 11.14. HEADINGS DESCRIPTIVE............................................................................91 11.15. SEVERABILITY....................................................................................91 11.16. INTEGRATION.....................................................................................91 11.17. CONSENT TO JURISDICTION.........................................................................91 11.18. SERVICE OF PROCESS..............................................................................92 11.19. NO LIMITATION ON SERVICE OR SUIT................................................................92 11.20. WAIVER OF TRIAL BY JURY.........................................................................92 11.21. TERMINATION.....................................................................................93
- 3 - 5 LIST OF EXHIBITS AND SCHEDULES EXHIBITS: Exhibit A - Assignment and Assumption Exhibit B - Commitment Amounts Exhibit C - Competitive Bid Borrowing Request Exhibit D - Compliance Certificate Exhibit E - Conventional Borrowing Request Exhibit F - Guaranty Exhibit G - Term Loan Conversion Notice Exhibit H - Note Exhibit I - Secretary's Certificate (Borrower) Exhibit J - Secretary's Certificate (Guarantor) Exhibit K - Points for Legal Opinions Exhibit L - Designation Agreement Exhibit M - Form of Notice of Conversion SCHEDULES: Schedule I - Domestic and Eurodollar Lending Offices Schedule 4 4 - Subsidiaries (including Subsidiary Guarantors) Schedule 4 5 - Litigation Schedule 4 12 - Plans Schedule 4 21 - Rent Roll and List of Unencumbered Assets Schedule 4 22 - Year 2000 Remediation 6 CREDIT AGREEMENT, dated as of November 17, 1999, by and among NEW PLAN EXCEL REALTY TRUST, INC., a Maryland corporation (the "Borrower"), each lender party hereto or which becomes a "Lender" or a "Designated Lender" pursuant to the provisions of Section 11.7 or 11.8, respectively (each a "Lender" and, collectively, the "Lenders"), THE BANK OF NEW YORK, as administrative agent (in such capacity, the "Administrative Agent"), and BANK ONE, NA and BANKBOSTON, N.A. (each a "Co-Documentation Agent" and, collectively, the "Co-Documentation Agents"). 1. DEFINITIONS 1.1. Defined Terms. As used in this Agreement, terms defined in the preamble have the meanings therein indicated, and the following terms have the following meanings: "ABR Advances": the Loans (or any portions thereof) at such time as they (or such portions) are made and/or being maintained at a rate of interest based upon the Alternate Base Rate. "Accountants": PricewaterhouseCoopers LLP, or, after the date hereof, any of: Arthur Andersen LLP; Deloitte & Touche LLP; Ernst & Young LLP; KPMG LLP; or any successor to any of the foregoing; or such other firm of certified public accountants of recognized national standing selected by the Borrower and satisfactory to the Administrative Agent. "Adjusted Net Operating Income": for any period, the aggregate amount of the Net Operating Income from each Unencumbered Asset during such period, less the Capital Expense Reserve for such Unencumbered Asset during such period. "Advance": an ABR Advance, a Eurodollar Advance or a Competitive Bid Advance, as the case may be. "Affected Advance": as defined in Section 2.10. "Affected Principal Amount": in the event that (i) the Borrower shall fail for any reason to borrow or convert after it shall have notified the Administrative Agent of its intent to do so in any instance in which it shall have requested a Eurodollar Advance pursuant to Section 2.3 or 2.8, or shall have accepted one or more offers of Competitive Bid Advances under Section 2.4, an amount equal to the principal amount of such Eurodollar Advance or Competitive Bid Advance; (ii) a Eurodollar Advance or Competitive Bid Advance shall terminate for any reason prior to the last day of the Interest Period applicable thereto, an amount equal to the principal amount of such Eurodollar Advance or Competitive Bid Advance; or (iii) the Borrower shall prepay or 7 repay all or any part of the principal amount of a Eurodollar Advance or Competitive Bid Advance prior to the last day of the Interest Period applicable thereto (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality), an amount equal to the principal amount of such Eurodollar Advance or Competitive Bid Advance so prepaid or repaid. "Affiliate": as to any Person, any other Person which, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person. For purposes of this definition, control of a Person shall mean the power, direct or indirect, (i) to vote 10% or more of the securities having ordinary voting power for the election of directors of such Person or (ii) to direct or cause the direction of the management and policies of such Person, whether by contract or otherwise. "Agreement": this Credit Agreement, as the same may be amended, supplemented or otherwise modified from time to time. "Alternate Base Rate": on any date, a rate of interest per annum equal to the higher of (i) the Federal Funds Rate in effect on such date plus 1/2 of 1% or (ii) the BNY Rate in effect on such date. "Ancillary Assets": at any time, all Real Property of the Borrower and its Subsidiaries, or in which the Borrower or any Subsidiary of the Borrower has an interest (either directly or indirectly), and which is (i) a Development Asset, (ii) a mortgage, or (iii) any other Real Property other than an open air shopping center (including single tenant retail properties) or a residential apartment building or residential apartment community (and appurtenant amenities). "Applicable Facility Fee Percentage": at all times during which the applicable Pricing Level set forth below is in effect, a rate per annum equal to the following applicable percentage amount corresponding to such Pricing Level: Pricing Level Applicable Facility Fee Percentage ------------- ---------------------------------- Pricing Level I 0.100% Pricing Level II 0.125% Pricing Level III 0.125% Pricing Level IV 0.150% Pricing Level V 0.175% Pricing Level VI 0.250% Pricing Level VII 0.350%. Changes in the Applicable Facility Fee Percentage resulting from a change in a Pricing Level shall become effective as of the opening of business upon the date of - 2 - 8 any change in the Borrower's Senior Debt Rating, as determined by S&P or Moody's, as the case may be, which would affect the applicable Pricing Level. "Applicable Lending Office": in respect of any Lender, (i) in the case of such Lender's ABR Advances and Competitive Bid Advances, its Domestic Lending Office and (ii) in the case of such Lender's Eurodollar Advances, its Eurodollar Lending Office. "Applicable Margin": with respect to the unpaid principal balance of Eurodollar Advances, at all times during which the applicable Pricing Level set forth below is in effect, the respective percentage set forth below next to such Pricing Level: Pricing Level Applicable Margin ------------- ----------------- Pricing Level I 0.525% Pricing Level II 0.625% Pricing Level III 0.625% Pricing Level IV 0.725% Pricing Level V 0.950% Pricing Level VI 1.000% Pricing Level VII 1.150%. Changes in the Applicable Margin resulting from a change in a Pricing Level shall become effective as of the opening of business upon the date of any change in the Senior Debt Rating of the Borrower, as determined by S&P or Moody's, as the case may be, which would affect the applicable Pricing Level. "Assignment and Assumption Agreement": an assignment and assumption agreement executed by an assignor and an assignee pursuant to which such assignor assigns to such assignee all or any portion of such assignor's Notes and Commitments, substantially in the form of Exhibit A. "Assignment Fee": as defined in Section 11.7(b). "Authorized Signatory": the chairman of the board, the president, any vice president, the Chief Financial Officer or any other duly authorized officer (acceptable to the Administrative Agent) of the Borrower. "Available Commitment Amount": on any day during the Revolving Credit Period, an amount equal to the Total Commitment Amount at such time minus the total of all Competitive Bid Borrowings outstanding on such date. "Benefited Lender": as defined in Section 11.10. - 3 - 9 "BNY": The Bank of New York. "BNY Rate": a rate of interest per annum equal to the rate of interest publicly announced in New York City by BNY from time to time as its prime commercial lending rate, such rate to be adjusted automatically (without notice) on the effective date of any change in such publicly announced rate. "Borrower's Interest": for any period, (i) with respect to Unencumbered Assets owned by a DownREIT Partnership, a fraction, expressed as a percentage, the numerator of which is the Net Operating Income of such Unencumbered Assets for such period, less any distributions required to be made to partners or members of such DownREIT Partnership, other than the Borrower and its Subsidiaries, and the denominator of which is the Net Operating Income of such Unencumbered Assets for such period, and (ii) with respect to any Ancillary Asset, the percentage of profits and losses with respect thereto to which the Borrower or its Subsidiaries, directly or indirectly, may be entitled to receive for such period. "Borrowing Date": any Business Day specified in a Borrowing Request delivered pursuant to Section 2.3 or 2.4, as the case may be, as a date on which the Borrower requests the Lenders to make Loans. "Borrowing Request": a Conventional Borrowing Request or a Competitive Bid Borrowing Request, as the case may be. "Business Day": for all purposes other than as set forth in clause (ii) below, (i) any day other than a Saturday, a Sunday or a day on which commercial banks located in New York City are authorized or required by law or other governmental action to close and (ii) with respect to all notices and determinations in connection with, and payments of principal and interest on, Eurodollar Advances, any day which is a Business Day described in clause (i) above and which is also a day on which dealings in foreign currency and exchange and Eurodollar funding between banks may be carried on in London, England. "Capital Leases": leases which have been, or under GAAP are required to be, capitalized. "Capital Expense Reserve": during any period, (i) with respect to each Unencumbered Asset other than a residential apartment building or residential apartment community, an amount equal to (A) a per annum rate of $.20 times (B) the total Net Rentable Area of such Unencumbered Asset, and (ii) with respect to each Unencumbered Asset that is a residential apartment building or residential apartment community, an amount equal to (A) $150 times (B) the number of apartment units in such residential - 4 - 10 apartment building or community (in each case whether or not such reserves are actually established by the Borrower). "Change of Control": the occurrence of any one of the following events: (a) any Person or Persons acting as a group shall acquire direct or indirect ownership of 30% or more of the Borrower's common Stock; or (b) during any twelve month period on or after the Effective Date, individuals who at the beginning of such period constituted the Board of Directors of the Borrower (together with any new directors whose election by the Board of Directors or whose nomination for election by the shareholders of the Borrower was approved by a vote of at least a majority of the members of the Board of Directors then in office who either were members of the Board of Directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the members of the Board of Directors then in office; or (c) there occurs a change of control of the Borrower of a nature that would be required to be reported in response to Item 1a of Form 8-K filed pursuant to Section 13 or 15 under the Securities Exchange Act of 1934, or in any other filing by the Borrower with the Securities and Exchange Commission; or (d) the Borrower consolidates with, is acquired by, or merges into or with any Person (other than a merger permitted by Section 8.2). "Chief Financial Officer": at any time, the chief financial officer of the Borrower, or if the Borrower does not have a chief financial officer at such time, the officer designated by the Borrower as its principal financial officer or such other officer of the Borrower that is acceptable to the Administrative Agent. "Code": the Internal Revenue Code of 1986, as the same may be amended from time to time, or any successor thereto, and the rules and regulations issued thereunder, as from time to time in effect. "Commitment": in respect of any Lender, such Lender's undertaking during the Revolving Credit Period to make Revolving Credit Loans, and as of the end of the Revolving Credit Period, such Lender's undertaking to convert the aggregate outstanding principal amount of such Lender's Revolving Credit Loans on such date to a Term Loan of such Lender, in each case subject to the terms and conditions hereof, in an aggregate outstanding principal amount not exceeding such Lender's Commitment Amount. "Commitment Amount": the amount set forth next to the name of such Lender in Exhibit B under the heading "Commitments" as such Lender's Commitment - 5 - 11 Amount, as the same may be reduced pursuant to Section 2.5. If the Borrower shall convert the Revolving Credit Loans to Term Loans pursuant to Section 2.1(b), then the Commitment Amount of each Lender shall be the Term Loan of such Lender outstanding from time to time. "Commitment Percentage": on any day, and as to any Lender, the quotient of (i) such Lender's Commitment Amount on such day, divided by (ii) the Commitments of all Lenders on such day. "Competitive Bid Advance": the Revolving Credit Loans (or any portions thereof) at such time as they (or such portions) consist of Competitive Bid Borrowings as provided for in Section 2.4. "Competitive Bid Borrowing": a borrowing pursuant to Section 2.4 consisting of simultaneous Competitive Bid Advances from each Lender whose offer to make a Competitive Bid Advance as part of such borrowing has been accepted by the Borrower under the auction bidding procedure set forth in Section 2.4. "Competitive Bid Borrowing Request": a borrowing request in the form of Exhibit C. "Competitive Bid Ceiling": at any time, an amount equal to 50% of the Total Commitment Amount at such time. "Compliance Certificate": a certificate substantially in the form of Exhibit D. "Consolidated": the Borrower and its Subsidiaries which are consolidated for financial reporting purposes. "Consolidated EBITDA": for any period, net income for such period of the Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, plus, without duplication and to the extent deducted in determining such net income, the sum of (i) Consolidated Interest Expense for such period, (ii) the aggregate amount of any taxes paid during such period, (iii) the aggregate amount attributable to depreciation and amortization for such period, (iv) the aggregate amount of extraordinary charges during such period and (v) the aggregate amount of non-cash expenses during such period, and minus, without duplication and to the extent added in determining such net income for such period, the aggregate amount of extraordinary gains during such period. "Consolidated Fixed Charges": during any period, the sum of each of the following with respect to the Borrower and its Subsidiaries (without duplication), determined on a Consolidated basis in accordance with GAAP: (i) the aggregate amount - 6 - 12 of all interest expense, both expensed and capitalized (including Consolidated Interest Expense) for such period, (ii) the aggregate of all scheduled principal amounts that become payable during such period in respect of any Indebtedness of the Borrower or its Subsidiaries (excluding balloon payments at maturity) and (iii) the aggregate amount of all cash dividends paid during such period in respect of preferred stock of the Borrower or its Subsidiaries. "Consolidated Interest Expense": for any period, interest and fees accrued, accreted or paid by the Borrower and its Subsidiaries during such period in respect of Consolidated Total Indebtedness, determined in accordance with GAAP, including (a) the amortization of debt discounts to the extent included in interest expense in accordance with GAAP, (b) the amortization of all fees (including fees with respect to interest rate cap agreements or other agreements or arrangements entered into by the Borrower or any of its Subsidiaries designed to protect the Borrower or such Subsidiaries, as applicable, against fluctuations in interest rates) payable in connection with the incurrence of any Indebtedness to the extent included in interest expense in accordance with GAAP and (c) the portion of any rents payable under capital leases allocable to interest expense in accordance with GAAP. "Consolidated Total Indebtedness": as of any date, the aggregate principal amount of all Indebtedness of the Borrower and its Subsidiaries determined on a Consolidated basis in accordance with GAAP, plus, if not otherwise required to be reflected in the Borrower's Consolidated balance sheet (and without duplication) (i) Contingent Obligations of the Borrower and its Subsidiaries on such date which are required in accordance with GAAP to be disclosed in a footnote to any such balance sheet, and (ii) any guarantee by the Borrower of any Indebtedness of an unconsolidated Subsidiary or joint venture in which the Borrower is a direct or indirect investor (to the full extent of the amount of such guaranteed Indebtedness on such date). "Contingent Obligation": as to any Person, any obligation of such Person guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations ("Primary Obligations") of any other Person (the "Primary Obligor") in any manner, whether directly or indirectly, and whether arising from partnership or keep-well agreements, including, without limitation, any obligation of such Person, whether contingent or not contingent (a) to purchase any such Primary Obligation or any Property constituting direct or indirect security therefor, (b) to advance or supply funds (i) for the purchase or payment of any such Primary Obligation or (ii) to maintain working capital or equity capital of the Primary Obligor or otherwise to maintain net worth, solvency or other financial statement condition of the Primary Obligor, (c) to purchase Property, securities or services primarily for the purpose of assuring the beneficiary of any such Primary Obligation of the ability of the Primary Obligor to make payment of such Primary Obligation or (d) otherwise to assure, protect from loss or hold harmless the beneficiary of such Primary Obligation against loss in respect thereof; provided, - 7 - 13 however, that the term Contingent Obligation shall not include the endorsement of instruments for deposit or collection in the ordinary course of business. The term Contingent Obligation shall also include the liability of a general partner in respect of the liabilities of the partnership in which it is a general partner. The amount of any Contingent Obligation of a Person shall be deemed to be an amount equal to the stated or determinable amount of the Primary Obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith. "Conventional Advance": an ABR Advance and/or a Eurodollar Advance. "Conventional Borrowing Request": a borrowing request in the form of Exhibit E. "Conversion Date": the date on which a Eurodollar Advance is converted to an ABR Advance, or the date on which an ABR Advance is converted to a Eurodollar Advance, or the date on which a Eurodollar Advance is converted to a new Eurodollar Advance, all in accordance with Section 2.8. "Credit Party": the Administrative Agent, the Lead Arranger, the Co-Documentation Agents, each Lender and their successors and assigns. "Default": any event or condition which constitutes an Event of Default or which, with the giving of notice, the lapse of time, or any other condition, would, unless cured or waived, become an Event of Default. "Defaulting Lender": at any time, any Lender that, at such time, (i) has failed to comply with any of its obligations to make a Loan as required pursuant to Section 2.3 or 2.4 of this Agreement, (ii) has failed to pay to the Administrative Agent or any Lender an amount owed by such Lender pursuant to the terms of this Agreement or any of the other Loan Documents, or (iii) has advised the Administrative Agent that it does not intend to comply with its obligations under Section 2.3 or 2.4 by reason of having been deemed insolvent or having become subject to a bankruptcy or insolvency proceeding. "Designated Lender": a special purpose corporation that is engaged in making, purchasing, or otherwise investing in commercial loans in the ordinary course of its business and that issues (or the parent of which issues) commercial paper rated at least "Prime-1" (or the then equivalent grade) by Moody's or "A-1" (or the then equivalent grade) by S&P that, in either case, (i) is organized under the laws of the United States or any state thereof, (ii) shall have become a party to this Agreement pursuant to Section 11.8 for the sole purposes of funding Competitive Bid Advances on behalf of a Designating Lender and (iii) is not otherwise a Lender. - 8 - 14 "Designating Lender": as defined in Section 11.8. "Designation Agreement": a designation agreement in substantially the form of Exhibit L hereto entered into between a Lender (other than a Designated Lender) and a Designated Lender, and accepted by the Administrative Agent. "Development Asset": any Property of the Borrower or its Subsidiaries, or in which the Borrower or any of its Subsidiaries has an interest (either directly or indirectly) (i) which is new construction, or which is undergoing an expansion which will increase the Net Rentable Area of such Property by 20,000 square feet or more (provided that with respect to any Property which is under expansion, if the balance thereof is a fully integrated, rentable property, then only the portion of such Property that is under expansion shall be a Development Asset), and (ii) for which a certificate of occupancy, whether temporary or permanent, or the functional equivalent thereof, has not been issued with respect to such construction or expansion. Notwithstanding the foregoing, any such new construction or expansion which shall have been a Development Asset under the criteria of this definition shall no longer be a Development Asset upon such time as (A) the same is an income-producing Property in operating condition, and (B) at least 70% of the Net Rentable Area (determined on an "as completed" basis) of such construction or expansion is initially leased to tenants who have taken possession thereof. "Dollars" and "$": lawful currency of the United States of America. "Domestic Lending Office": in respect of any Lender, initially, the office or offices of such Lender designated as such on Schedule I; thereafter, such other office of such Lender through which it shall be making or maintaining ABR Advances or Competitive Bid Advances, as reported by such Lender to the Administrative Agent and the Borrower. "DownREIT Partnership": Excel Realty Partners, L.P., E. H. Properties, L.P. and any other partnership or limited liability company hereafter created by the Borrower for the purpose of acquiring assets qualifying as "real estate assets" under Section 856(c) of the Code through the issuance of partnership or limited liability company units in such partnership or limited liability company to third parties, provided that, in the case of each such entity (including Excel Realty Partners, L.P. and E. H. Properties, L.P.) (i) the Borrower or a wholly owned Subsidiary of the Borrower is the sole general partner or managing member of such partnership or limited liability company, as the case may be, and (ii) the Borrower or its wholly owned Subsidiary shall be entitled to receive not less than 99% of the net income and gains before depreciation, if any, from such partnership or limited liability company after the limited partners or non-managing members of such partnership or limited liability company receive a stipulated distribution. Any partnership or limited liability company created after the - 9 - 15 Effective Date must be approved by the Administrative Agent as a "DownREIT Partnership" for purposes of being included in this definition. "Effective Date": the date on which the conditions specified in Section 5 are satisfied. "Environmental Laws": any and all federal, state and local laws relating to the environment, the use, storage, transporting, manufacturing, handling, discharge, disposal or recycling of hazardous substances, materials or pollutants or industrial hygiene and including, without limitation, (i) the Comprehensive Environmental Response, Compensation and Liability Act, as amended, 42 USCA Section 9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976, as amended, 42 USCA Section 6901 et seq.; (iii) the Toxic Substance Control Act, as amended, 15 USCA Section 2601 et seq.; (iv) the Water Pollution Control Act, as amended, 33 USCA Section 1251 et seq.; (v) the Clean Air Act, as amended, 42 USCA Section 7401 et seq.; (vi) the Hazardous Material Transportation Act, as amended, 49 USCA Section 1801 et seq. and (viii) all rules, regulations, judgments, decrees, injunctions and restrictions thereunder and any analogous state law. "Environmental Risk Property": any Real Property of the Borrower, a Subsidiary Guarantor or a DownREIT Partnership in respect of which, at any time: (i) Hazardous Substances are (A) generated or manufactured on, transported to or from, treated at, stored at or discharged from such Real Property in violation of any Environmental Laws; (B) discharged into subsurface waters under such Real Property in violation of any Environmental Laws; or (C) discharged from such Real Property on or into property or waters (including subsurface waters) adjacent to such Real Property in violation of any Environmental Laws, and any of the foregoing events in (A), (B) or (C) has an Adverse Environmental Impact; or (ii) there exists with respect to such Real Property (A) a claim, demand, suit, action, proceeding, condition, report, directive, lien, violation, or non-compliance concerning any liability (including, without limitation, potential liability for enforcement, investigatory costs, cleanup costs, government response costs, removal costs, remedial costs, natural resources damages, property damages, personal injuries or penalties) arising in connection with: (x) any non-compliance with or violation of the requirements of any applicable Environmental Laws, or (y) the presence of any Hazardous Substance on such Real Property or the release of any Hazardous Substance into the environment from such Real Property, or (B) any actual liability in connection with the presence of any Hazardous Substance on such Real Property or the release of any Hazardous Substance into the environment from such Real Property, and any of the foregoing events in (A) or (B) has an Adverse Environmental Impact. - 10 - 16 For purposes of this definition, the term "Adverse Environmental Impact" shall mean any event described in clauses (A), (B) or (C) of paragraph (i) above or clauses (A) or (B) of paragraph (ii) above which could reasonably be expected to have a material adverse effect on (1) the value of such Real Property, (2) the marketability of such Real Property, or (3) the ability to finance or refinance such Real Property. "ERISA": the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations issued thereunder, as from time to time in effect. "ERISA Affiliate": any Person which is a member of any group of organizations (i) described in Section 414(b) or (c) of the Code of which the Borrower is a member, or (ii) solely for purposes of potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code and the Lien created under Section 302(f) of ERISA and Section 412(n) of the Code, described in Section 414(m) or (o) of the Code of which the Borrower is a member. "ERISA Liabilities": without duplication, the aggregate of all unfunded vested benefits under all Plans and all potential withdrawal liabilities under all Multiemployer Plans. "Eurodollar Advance": collectively, the Loans (or any portions thereof), other than Competitive Bid Advances, at such time as they (or such portions) are made and/or being maintained at a rate of interest based upon a particular Eurodollar Rate; and "Eurodollar Advances" shall mean all such Eurodollar Advances in the aggregate. "Eurodollar Lending Office": in respect of any Lender, initially, the office, branch or affiliate of such Lender designated as such on Schedule I (or, if no such office branch or affiliate is specified, its Domestic Lending Office); thereafter, such other office, branch or affiliate of such Lender through which it shall be making or maintaining Eurodollar Advances, as reported by such Lender to the Administrative Agent and the Borrower. "Eurodollar Rate": with respect to each Eurodollar Advance and as determined by the Administrative Agent, the rate of interest per annum (rounded, if necessary, to the nearest 1/100 of 1% or, if there is no nearest 1/100 of 1%, then to the next higher 1/100 of 1%) equal to a fraction, the numerator of which is the rate per annum quoted by BNY at approximately 12:00 P.M. (or as soon thereafter as practicable) two Eurodollar Business Days prior to the first day of such Interest Period to leading banks in the interbank eurodollar market as the rate at which BNY is offering Dollar deposits in an amount approximately equal to its Commitment Percentage of such Eurodollar Advance and having a period to maturity approximately equal to the Interest - 11 - 17 Period applicable to such Eurodollar Advance, and the denominator of which is an amount equal to 1.00 minus the aggregate of the then stated maximum rates during such Interest Period of all reserve requirements (including marginal, emergency, supplemental and special reserves), expressed as a decimal, established by the Board of Governors of the Federal Reserve System and any other banking authority to which BNY and other major United States money center banks are subject, in respect of eurocurrency liabilities. "Event of Default": any of the events specified in Section 9, provided that any requirement for the giving of notice, the lapse of time or any other condition specified in Section 9 has been satisfied. "Existing Credit Agreements" shall mean that (i) certain Revolving Credit Agreement dated as of November 21, 1997 among New Plan Realty Trust (as predecessor in interest to the Borrower), The Bank of New York, as Administrative Agent, and the lenders signatory thereto, as the same has been amended and assumed by the Borrower, (ii) that certain First Amended and Restated Revolving Credit Agreement, dated as of March 31, 1998, among the Borrower (successor by merger to Excel Realty Trust, Inc.), BankBoston, N.A., as Agent, and the lenders signatory thereto, as the same has been amended, and (iii) that certain Term Loan Agreement, dated July 13, 1999, among the Borrower, The Bank of New York, as agent, and the lenders party thereto. "Facility Fee": as defined in Section 3.1. "Federal Funds Rate": for any day, a rate per annum (expressed as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%), equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that (i) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average of the quotations for such day on such transactions received by BNY as determined by BNY and reported to the Administrative Agent. "Financial Statements": as defined in Section 4.13. "Fixed Charge Coverage Ratio": for any period, the ratio of (i) Consolidated EBITDA during such period to (ii) Consolidated Fixed Charges during such period. - 12 - 18 "Fixed Rate Advance": A Eurodollar Advance or a Competitive Bid Advance. "Funds from Operations": With respect to any Person for any fiscal period, the sum of (i) the net income of such Person for such fiscal period (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and sales of property, (ii) depreciation and amortization, and (iii) other non-cash items, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. "GAAP": generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statement by such other entity as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination, consistently applied. "Governmental Authority": any nation or government, any state or other political subdivision thereof, any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and any court or arbitrator. "Ground Lease": a ground lease in favor of the Borrower, a wholly owned Subsidiary or a DownREIT Partnership which has an unexpired term of 30 years or more (inclusive of any tenant-controlled renewal options) and which includes within its terms those rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold estate demised pursuant to such ground lease. "Guaranty": collectively, (i) a Guaranty, substantially in the form of Exhibit F executed by each of the Subsidiary Guarantors identified on Schedule 4.4 and delivered to the Administrative Agent for the benefit of the Lenders on or prior to the Effective Date, and (ii) each additional Guaranty substantially in the form of Exhibit F executed by each Required Additional Guarantor and delivered to the Administrative Agent for the benefit of the Lenders after the Effective Date. "Hazardous Substance": any hazardous or toxic substance, material or waste, including, but not limited to, (i) those substances, materials, and wastes listed in the United States Department of Transportation Hazardous Materials Table (49 CFR 172.101) or by the Environmental Protection Agency as hazardous substances (40 CFR Part 302) and amendments thereto and replacements therefor and (ii) any substance, pollutant or material defined as, or designated in, any Environmental Law as a - 13 - 19 "hazardous substance," "toxic substance," "hazardous material," "hazardous waste," "restricted hazardous waste," "pollutant," "toxic pollutant" or words of similar import. "Hedging Agreement" means any interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement. "Highest Lawful Rate": with respect to any Lender, the maximum rate of interest, if any, that at any time or from time to time may be contracted for, taken, charged or received by such Lender on its Note or which may be owing to such Lender pursuant to this Agreement under the laws applicable to such Lender and this Agreement. "Indebtedness": as to any Person, at a particular time, all items which constitute, without duplication, (a) indebtedness for borrowed money (including, without limitation, indebtedness under this Agreement and the Notes) or the deferred purchase price of Property (other than trade payables incurred in the ordinary course of business), (b) indebtedness evidenced by notes, bonds, debentures or similar instruments, (c) obligations with respect to any conditional sale or title retention agreement, (d) indebtedness arising under acceptance facilities and the amount available to be drawn under all letters of credit issued for the account of such Person and, without duplication, all drafts drawn thereunder to the extent such Person shall not have reimbursed the issuer in respect of the issuer's payment of such drafts, (e) all liabilities secured by any Lien on any Property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof (other than carriers', warehousemen's, mechanics', repairmen's or other like non-consensual statutory Liens arising in the ordinary course of business), (f) obligations under Capital Leases, (g) Contingent Obligations and (h) ERISA Liabilities. "Indemnified Person": as defined in Section 11.12. "Intellectual Property": all copyrights, trademarks, patents, trade names and service names. "Interest Payment Date": (i) as to any ABR Advance, the first day of each month commencing on the first such day to occur after such ABR Advance is made or any Eurodollar Advance is converted to an ABR Advance, (ii) as to any Eurodollar Advance in respect of which the Borrower has selected an Interest Period of one, two or three months, the last day of such Interest Period, (iii) as to any Eurodollar Advance in respect of which the Borrower has selected an Interest Period of six months, the day which is three months after the first day of such Interest Period and the last day of such Interest Period, (iv) as to any Competitive Bid Advance in respect of which the Borrower has selected an Interest Period of 90 days or less, the last day of the Interest Period applicable thereto, and (v) as to any Competitive Bid Advance in respect of which the - 14 - 20 Borrower has selected an Interest Period of more than 90 days, the day which is 90 days after the first day of such Interest Period and the last day of such Interest Period. "Interest Period": (i) with respect to any Eurodollar Advance requested by the Borrower, the period commencing on, as the case may be, the Borrowing Date or Conversion Date with respect to such Eurodollar Advance and ending one, two, three or six months thereafter, as selected by the Borrower in its irrevocable Borrowing Request as provided in Section 2.3 or its irrevocable notice of conversion as provided in Section 2.8, and (ii) with respect to any Competitive Bid Advance, the period commencing on the Borrowing Date with respect to such Competitive Bid Advance and ending on the maturity date thereof specified in the Competitive Bid Borrowing Request with respect thereto given pursuant to Section 2.4; provided, however, that all of the foregoing provisions relating to Interest Periods are subject to the following: (a) if any Interest Period pertaining to a Eurodollar Advance would otherwise end on a day which is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month, in which event such Interest Period shall end on the immediately preceding Business Day; (b) if, with respect to the borrowing of any Loan as a Eurodollar Advance or the conversion of one Advance to another pursuant to Section 2.8, the Borrower shall fail to give due notice as provided in Section 2.3 or 2.8, as the case may be, the Borrower shall be deemed to have elected that such Loan or Advance shall be made as an ABR Advance; (c) any Interest Period 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 a calendar month; (d) with respect to any Interest Period applicable to a Eurodollar Advance (i) selected during the Revolving Credit Period, no such Interest Period shall end after the Revolving Credit Termination Date, and (ii) selected after any election of the Term Loan, no such Interest Period shall end after the Maturity Date; (e) with respect to any Interest Period applicable to a Competitive Bid Advance, no such Interest Period shall end after the Revolving Credit Termination Date; (f) the Borrower shall select Interest Periods so as not to have more than six different Interest Periods outstanding at any one time with respect to Eurodollar Advances and three different Interest Periods outstanding at any one time with respect to Competitive Bid Advances; - 15 - 21 (g) no Interest Period pertaining to a Competitive Bid Advance shall be shorter than 7 days or longer than 180 days; (h) each Interest Period for a Competitive Bid Advance must commence and end on a Business Day. "Investments": as defined in Section 8.3. "Lead Arranger": BNY Capital Markets, Inc. "Lien": any mortgage, pledge, hypothecation, assignment, deposit or preferential arrangement, encumbrance, lien (statutory or other), or other security agreement or security interest of any kind or nature whatsoever, including, without limitation, any conditional sale or other title retention agreement and any capital or financing lease having substantially the same economic effect as any of the foregoing. "Loan" and "Loans": a Revolving Credit Loan (or Loans), a Term Loan (or Loans), and/or a Competitive Bid Borrowing (or Borrowings), as the case may be. All Loans shall be made in Dollars. "Loan Documents": collectively, this Agreement, the Guaranty (and each Guaranty subsequently delivered pursuant to Section 7.11) and the Notes. "Margin Stock": any "margin stock", as said term is defined in Regulation U of the Board of Governors of the Federal Reserve System, as the same may be amended or supplemented from time to time. "Material Adverse Effect": a material adverse effect on (i) the financial condition, operations, business, or Properties of (A) the Borrower or (B) the Borrower and its Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform its obligations under the Loan Documents or (iii) the ability of the Administrative Agent and the Lenders to enforce the Loan Documents. "Maturity Date": (i) with respect to Revolving Credit Loans made as Conventional Advances, if such Loans are not converted to Term Loans pursuant to Section 2.1(b), the earlier of the Revolving Credit Termination Date or the date on which the Notes shall become due and payable, whether by acceleration or otherwise, (ii) with respect to Competitive Bid Borrowings, the date each such Competitive Bid Borrowing is due in accordance with Section 2.4(f) or by acceleration, and (iii) with respect to any Term Loans, the earlier of the date that is two years after the Revolving Credit Termination Date or the date on which the Notes shall become due and payable, whether by acceleration or otherwise. "Moody's": Moody's Investors Services, Inc. - 16 - 22 "Multiemployer Plan": a plan defined as such Section 3(37) of ERISA to which contributions have been made by the Borrower or any ERISA Affiliate and which is covered by Title IV of ERISA. "Net Operating Income": for any period and with respect to all assets which are Unencumbered Assets during such period, net income for such period, determined in accordance with GAAP, attributable to Unencumbered Assets, plus depreciation and amortization, interest expense and any extraordinary or non-recurring losses deducted in calculating such net income, minus extraordinary or non-recurring gains and payments (including rent insurance proceeds and condemnation awards) included in such net income, minus any portion of such net income attributable to rents paid by any tenant which is an Affiliate of the Borrower, minus an amount (but not less than zero) equal to the difference between (i) 3% of Operating Income for such period, less (ii) management fees payable in respect of such Unencumbered Assets during such period. For purposes of any calculation of Net Operating Income, real estate taxes, ground rent and insurance, shall be included only at their stabilized, recurring levels. "Net Rentable Area": with respect to any Real Property, the floor area of any buildings, structures or improvements thereof (expressed in square feet) available for leasing to tenants, as determined in accordance with the leases or site plans or leasing plans for such Real Property, or if such leases or site plans do not set forth the floor area demised thereunder (or if such Real Property is not subject to a lease), then as determined by the Borrower in accordance with an industry-accepted protocol approved by the Administrative Agent. "Non-Recourse Exclusions": With respect to any Indebtedness of any Person which is secured by one or more parcels of Real Property or interests therein and which is not a general obligation of such Person, any usual and customary exclusions from the non-recourse limitations governing such Indebtedness, including, without limitation, exclusions for claims that (i) are based on fraud, intentional misrepresentation or misapplication of funds, (ii) result from intentional mismanagement of or waste at such Real Property, (iii) arise from the presence of Hazardous Substances on such Real Property; or (iv) are the result of any unpaid real estate taxes and assessments. "Non-Recourse Indebtedness": At any time, Indebtedness of the Borrower and of its Subsidiaries at such time which is secured by one or more parcels of Real Property or interests therein and which is not a general obligation of the Borrower or such Subsidiary, the holder of such Indebtedness having recourse solely to the parcels of Real Property securing such Indebtedness, the leases thereon and the rents and profits thereof (except for recourse against the general credit of the Borrower or its Subsidiaries for any Non-Recourse Exclusions), provided that in calculating the amount of Non-Recourse Indebtedness at any time, the amount of any Non-Recourse Exclusions which are the subject of a final judgment shall not be included in Non-Recourse Indebtedness. - 17 - 23 "Note" and "Notes": as defined in Section 2.2. "Operating Property": Any Real Property which at any time (i) is an income-producing property in operating condition and in respect of which no material part thereof has been damaged by fire or other casualty (unless such damage has been repaired) or condemned (unless such condemnation has been restored), (ii) is a retail shopping center, residential apartment building, office building or other operating Property, (iii) for which a certificate of occupancy, whether temporary or permanent, or the functional equivalent thereof, has been issued for all improvements comprising the same and are in full force and effect, and (iv) is at least 60% occupied by tenants who have accepted the property and are paying rent in accordance with the terms of their leases, and "Operating Properties" means all such Operating Properties, collectively. "Other Credit Agreement": that certain Credit Agreement of even date herewith among the Borrower, the Administrative Agent, the Co-Documentation Agents and the Lenders party thereto providing for a senior three-year revolving credit facility in favor of the Borrower, as the same may be amended from time to time. "Participating Lender": defined in Section 2.4. "PBGC": the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA, or any Governmental Authority succeeding to the functions thereof. "Permitted Liens": Liens permitted to exist under Section 8.1. "Person": an individual, a partnership, a corporation, a business trust, a limited liability company, a joint stock company, a trust, an unincorporated association, a joint venture, a Governmental Authority or any other entity of whatever nature. "Plan": any employee benefit or other plan established or maintained by the Borrower or any ERISA Affiliate and which is covered by or subject to the minimum funding standards of Title IV of ERISA, other than a Multiemployer Plan. "Pricing Level": one of the following seven pricing levels, as applicable, provided that if the ratings by S&P and Moody's in any such Pricing Level are split by more than one equivalent rating level, the operative rating would be deemed to be one rating level higher than the lower of the two ratings, and provided, further, that during any period that the Borrower has no Senior Debt Rating, Pricing Level VII would be the applicable Pricing Level: "Pricing Level I": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to AA- by S&P or Aa3 by Moody's; - 18 - 24 "Pricing Level II": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to A by S&P or A2 by Moody's and Pricing Level I is not applicable; "Pricing Level III": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to A- by S&P or A3 by Moody's and Pricing Levels I and II are not applicable; "Pricing Level IV": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to BBB+ by S&P or Baa1 by Moody's and Pricing Levels I, II and III are not applicable; "Pricing Level V": the Pricing Level which would be applicable for so long as the Senior Debt Rating is equal to BBB by S&P or Baa2 by Moody's and Pricing Levels I, II, III and IV are not applicable; "Pricing Level VI": the Pricing Level which would be applicable for so long as the Senior Debt Rating is equal to BBB- by S&P or Baa3 by Moody's and Pricing Levels I, II, III, IV and V are not applicable; and "Pricing Level VII": the Pricing Level which would be applicable for so long as the Senior Debt Rating is less than or equal to BB+ by S&P or Ba1 by Moody's and Pricing Levels I, II, III, IV, V and VI are not applicable. "Property": all types of real, personal, tangible, intangible or mixed property. "Proposed Bid Rate": as applied to any Remaining Interest Period with respect to a Lender's Competitive Bid Advance, the rate per annum that such Lender in good faith would have quoted to the Borrower had the Borrower requested that such Lender offer to make a Competitive Bid Advance on the first day of such Remaining Interest Period, assuming no Default or Event of Default existed on such day and that the Borrower had the right to borrow hereunder on such day; each such rate to be determined by such Lender in good faith in its sole discretion. "Rated Period": Any period during which S&P and Moody's are maintaining a Senior Debt Rating and such Senior Debt Rating is at least BBB- as determined by S&P, and at least Baa3, as determined by Moody's. "Real Property": all real Property, and all interests in real Property, owned, leased or held by the Borrower or any Subsidiary of the Borrower. - 19 - 25 "REIT": a Person qualifying as a real estate investment trust under sections 856-859 of the Code and the regulations and rulings of the Internal Revenue Service issued thereunder. "Remaining Interest Period": (i) in the event that the Borrower shall fail for any reason to borrow a Loan in respect of which it shall have requested a Eurodollar Advance or convert an Advance to a Eurodollar Advance after it shall have notified the Administrative Agent of its intent to do so pursuant to Section 2.3 or 2.8 or accepted one or more offers of Competitive Bid Advances under Section 2.4, a period equal to the Interest Period that the Borrower elected in respect of such Eurodollar Advance or Competitive Bid Advance; or (ii) in the event that a Eurodollar Advance or Competitive Bid Advance shall terminate for any reason prior to the last day of the Interest Period applicable thereto, a period equal to the remaining portion of such Interest Period if such Interest Period had not been so terminated; or (iii) in the event that the Borrower shall prepay or repay all or any part of the principal amount of a Eurodollar Advance or Competitive Bid Advance (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality) prior to the last day of the Interest Period applicable thereto, a period equal to the period from and including the date of such prepayment or repayment to but excluding the last day of such Interest Period. "Rent Roll": a schedule prepared by the Borrower from time to time identifying (i) the Real Property owned by the Borrower or its Subsidiaries and stating whether such items of Real Property are Unencumbered Assets at such time, (ii) the annual base rent payable under each lease of Real Property owned by the Borrower or any of its Subsidiaries, (iii) the commencement and termination dates of the term of each such lease, (iv) any renewal options with respect to such lease, (v) the Net Rentable Area of the space demised under each such lease and (vi) such other information as the Administrative Agent may reasonably require. "Required Additional Guarantors": any Subsidiary required to execute and deliver a Guaranty pursuant to Section 7.11. "Required Lenders": means (a) so long as the Commitments remain in effect (i) if no Loans are outstanding at such time or there are Loans comprised of Conventional Advances and Competitive Bid Advances, Lenders (other than any Defaulting Lenders or Designated Lenders) having Commitments equal to at least 51% of the Commitments of all Lenders at such time; (ii) if Loans outstanding at such time are comprised of Conventional Advances only, Lenders (other than any Defaulting Lenders or Designated Lenders) holding Notes having an unpaid principal balance equal to at least 51% of the aggregate Loans then outstanding; and (iii) if Loans outstanding at such time are comprised of Competitive Bid Advances only, Lenders (other than any Defaulting Lenders or Designated Lenders) having Commitments equal to at least 51% of the Commitments of all Lenders at such time (whether used or unused); and (b) if the - 20 - 26 Commitments have been terminated, Lenders (other than any Defaulting Lenders but including any Designated Lenders) whose Loans have an unpaid principal balance equal to at least 51% of the aggregate Loans then outstanding. "Restricted Payment": as to any Person, any dividend or other distribution by such Person (whether in cash, securities or other property) with respect to any shares of any class of equity securities or beneficial interests of such Person, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such shares or beneficial interests or any option, warrant or other right to acquire any such shares or beneficial interests. "Revolving Credit Expiration Date:" the earlier of the Maturity Date or the Revolving Credit Termination Date. "Revolving Credit Loan" and "Revolving Credit Loans": as defined in Section 2.1. "Revolving Credit Period:" the period from the Effective Date through the day preceding the Revolving Credit Expiration Date. "Revolving Credit Termination Date": the date that is 364 days from the Effective Date, subject to extension in accordance with Section 2.18. "Senior Debt Rating": the senior unsecured non-credit-enhanced debt rating of the Borrower as determined by S&P and/or Moody's from time to time. "Special Counsel": Emmet, Marvin & Martin, LLP, special counsel to BNY. "S&P": Standard & Poor's Ratings Group. "Stock": any and all shares, rights, interests, participations, warrants, depositary receipts or other equivalents (however designated) of corporate stock, including, without limitation, so-called "phantom stock," preferred stock and common stock. "Subsidiary": as to any Person, any corporation, association, partnership, limited liability company, joint venture or other business entity of which such Person, directly or indirectly, either (i) in respect of a corporation, owns or controls more than 50% of the outstanding Stock having ordinary voting power to elect a majority of the board of directors or similar managing body, irrespective of whether a class or classes shall or might have voting power by reason of the happening of any contingency, or (ii) in respect of an association, partnership, limited liability company, joint venture or other - 21 - 27 business entity, is entitled to share, either directly or indirectly through an entity described in clause (i) above, in more than 50% of the profits and losses, however determined. "Subsidiary Guarantor" means the Subsidiaries of the Borrower listed on Schedule 4.4 and designated thereof as a Subsidiary Guarantor, each Required Additional Guarantor, and their successors and assigns; and "Subsidiary Guarantors" shall mean all such guarantors, collectively. "Tangible Net Worth": as of any date of determination thereof with respect to the Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, the remainder of (i) the amounts which would, in conformity with GAAP, be included under "shareholder's equity" (or any like caption) on a Consolidated balance sheet of the Borrower and its Subsidiaries as at such date, minus (ii) the net book value of all assets of the Borrower and its Subsidiaries on a Consolidated basis (to the extent reflected in the Consolidated balance sheet of the Borrower at such date) which would be treated as intangibles under GAAP, including, without limitation, goodwill (whether representing the excess cost over book value of assets acquired or otherwise), patents, trademarks, trade names, franchises, copyrights, licenses, service marks, rights with respect to the foregoing and deferred charges (including, without limitation, unamortized debt discount and expense, organization costs and research and development costs). "Taxes": any present or future income, stamp or other taxes, levies, imposts, duties, fees, assessments, deductions, withholdings, or other charges of whatever nature, now or hereafter imposed, levied, collected, withheld, or assessed by any Governmental Authority. "Term Loan" and "Term Loans": as defined in Section 2.1(b). "Term Loan Conversion Notice": a notice to the Administrative Agent in the form of Exhibit G. "Total Capital": on any date, the sum of, without duplication, (i) all Indebtedness of the Borrower and its Subsidiaries on such date which, in accordance with GAAP, is considered long term debt of the Borrower and its Subsidiaries, (ii) the amounts which would, in conformity with GAAP, be included under "shareholder's equity" (or any like caption) on a Consolidated balance sheet of the Borrower and its Subsidiaries as at such date, (iii) the value of all issued and outstanding preferred stock of the Borrower as set forth on the balance sheet of the Borrower as at such date, and (iv) all Loans outstanding on such date. - 22 - 28 "Total Commitment Amount": (i) on any day during the Revolving Credit Period, the sum of the Commitment Amounts of all Lenders on such day, and (ii) on any day after the conversion of the Revolving Credit Loans to Term Loans, the sum of the Term Loans of all Lenders on such day. "Unencumbered Asset": Any Operating Property which at any time (i) is wholly owned in fee simple by the Borrower, a wholly owned Subsidiary of the Borrower or a DownREIT Partnership (or is the subject of a Ground Lease), (ii) is free and clear of all Liens (other than Liens permitted under clauses (i), (ii), (iii), (iv), (v) (vi), (viii) and (ix) of Section 8.1), (iii) does not have applicable to it (or to any such Ground Lease) any restriction on the pledge, transfer, mortgage or assignment of such Operating Property or Ground Lease (including any restriction imposed by the organizational documents of any such Subsidiary or DownREIT Partnership), (iv) if owned by any such Subsidiary or DownREIT Partnership, the Stock, partnership interests or membership interests, as the case may be, of such Subsidiary or DownREIT Partnership that are owned by the Borrower or any Subsidiary are not subject to any pledge or security interest in favor of any Person other than the Borrower or a Subsidiary Guarantor, (v) is not an Environmental Risk Property; (vi) does not have, to the best of the Borrower's knowledge, any title, survey, environmental or other defect which could reasonably be expected to materially and adversely affect the value, use or marketability thereof, and (vii) is located within the contiguous 48 states of the continental United States; and "Unencumbered Assets" mean all such Unencumbered Assets, collectively. "Unencumbered Assets Coverage Ratio": on any date of determination the ratio of (i) the sum of all Adjusted Net Operating Income for all Unencumbered Assets of the Borrower and its Subsidiaries on a Consolidated basis, plus the Borrower's Interest in all Adjusted Net Operating Income for all Unencumbered Assets owned by a DownREIT Partnership, in each case for the fiscal quarter most recently then ending, to (ii) the portion of the Consolidated Interest Expense consisting of interest on all unsecured Indebtedness of the Borrower and its Subsidiaries as of such fiscal quarter end. "Unencumbered Asset Value": as of any date the quotient of (i) an amount equal to the Adjusted Net Operating Income for all Unencumbered Assets in the aggregate for the four fiscal quarters of the Borrower most recently ending as of such date, divided by (ii) 10%. For purposes of any determination of Unencumbered Asset Value, the following limitations and methodology shall apply: (A) the Adjusted Net Operating Income of any Unencumbered Asset owned by a DownREIT Partnership shall be based on the Borrower's Interest in the Adjusted Net Operating Income for each such Unencumbered Asset for the four fiscal quarters having ended as of such date; (B) in the event more than 10% of the gross base rents payable under all leases for Properties of the Borrower, its Subsidiaries or a DownREIT Partnership (including the Borrower's Interest in any Property) shall be payable by one tenant and its Subsidiaries, then Unencumbered Asset Value shall be reduced by the percentage amount of such excess multiplied by the - 23 - 29 Unencumbered Asset Value attributable to the Properties leased or controlled by such tenant and its Subsidiaries, and (C) in the event that the Borrower or a Subsidiary of the Borrower shall not have owned an Unencumbered Asset for the entire previous four fiscal quarters, then for the purposes of determining the Unencumbered Asset Value with respect to such Unencumbered Asset, the Adjusted Net Operating Income for such Unencumbered Asset shall be annualized in a manner reasonably satisfactory to the Administrative Agent. 1.2. Other Definitional Provisions. (a) All terms defined in this Agreement shall have the meanings given such terms herein when used in the Loan Documents or any certificate, opinion or other document made or delivered pursuant hereto or thereto, unless otherwise defined therein. (b) As used in the Loan Documents and in any certificate, opinion or other document made or delivered pursuant hereto or thereto, accounting terms not defined in Section 1.1, and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP. (c) The words "hereof", "herein", "hereto" and "hereunder" and similar words when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, schedule and exhibit references contained herein shall refer to Sections hereof or schedules or exhibits hereto unless otherwise expressly provided herein. (d) The word "or" shall not be exclusive; "may not" is prohibitive and not permissive. (e) Unless the context otherwise requires, words in the singular number include the plural, and words in the plural include the singular. (f) Unless specifically provided in a Loan Document to the contrary, references to time shall refer to New York City time. 2. AMOUNT AND TERMS OF LOANS. 2.1. Loans. (a) Revolving Credit Loans. Subject to the terms and conditions hereof, each Lender severally agrees to make revolving credit loans (each a "Revolving Credit Loan" and, as the context may require, collectively with all Revolving Credit Loans of such Lender and with the Revolving Credit Loans of all other Lenders, the "Revolving Credit Loans") to the Borrower from time to time during the Revolving - 24 - 30 Credit Period, in an aggregate principal amount not to exceed at any time (exclusive of any Competitive Bid Advances of such Lender at such time) such Lender's Commitment Amount. At no time shall the aggregate outstanding principal amount of the Revolving Credit Loans of all Lenders exceed the Total Commitment Amount. During the Revolving Credit Period, the Borrower may borrow, prepay in whole or in part and reborrow under the Commitments, all in accordance with the terms and conditions of this Agreement. Subject to the provisions of Sections 2.3, 2.4 and 2.8, Revolving Credit Loans may be (a) ABR Advances, (b) Eurodollar Advances, (c) Competitive Bid Advances or (d) any combination thereof. (b) Term Loans. Subject to the terms and conditions hereof, the Borrower may elect to convert all Revolving Credit Loans of all Lenders outstanding under this Agreement as of the Revolving Credit Termination Date to a single non-revolving loan of each such Lender (each such loan being a "Term Loan," and together with the Term Loans of all Lenders, the "Term Loans"). Such election shall be made by the Borrower's delivery to the Administrative Agent of a Term Loan Conversion Notice on any date that is at least 30, but not more than 60, days prior to the Revolving Credit Termination Date. Upon receipt of such notice, the Administrative Agent shall promptly deliver a copy of the notice to each Lender. Provided that no Event of Default shall have occurred and be continuing on the Revolving Credit Termination Date, the outstanding principal amount of each Lender's Revolving Credit Loans shall be converted to a Term Loan of such Lender as of such date and any and all obligations of the Lenders to make advances hereunder shall terminate. Subject to the provisions of Sections 2.3 and 2.8, Term Loans may continue to be maintained as (a) ABR Advances, (b) Eurodollar Advances, or (c) any combination thereof. 2.2. Notes. (a) Notes as Evidence of Indebtedness. The Revolving Credit Loans of each Lender made as Conventional Advances and the Term Loans of each Lender shall be evidenced by a promissory note of the Borrower, substantially in the form of Exhibit H, with appropriate insertions therein as to date and principal amount (each, as endorsed or modified from time to time, a "Note" and, collectively with the Notes of all other Lenders, the "Notes"), payable to the order of such Lender for the account of its Applicable Lending Office and representing the obligation of the Borrower to pay the lesser of (a) the original amount of the Commitment of such Lender and (b) the aggregate unpaid principal balance of all Revolving Credit Loans made as a Conventional Advances and Term Loans of such Lender plus interest and other amounts due and owing to the Lenders under the Loan Documents. (b) The Notes Generally. Each Note shall bear interest from the date thereof on the unpaid principal balance thereof at the applicable interest rate or rates per annum determined as provided in Section 2.9 and shall be stated to mature on the - 25 - 31 Maturity Date. The following information shall be recorded by each Lender on its books and, prior to any transfer of any such Notes, endorsed by such Lender on the schedule attached thereto or any continuation thereof: (i) the date and amount of each Revolving Credit Loan of such Lender made as a Conventional Advance; (ii) its character as an ABR Advance, a Eurodollar Advance or a combination thereof; (iii) the interest rate and Interest Period applicable to Eurodollar Advances; and (iv) each payment and prepayment of the principal thereof; provided, that the failure of such Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower to make payment when due of any amount owing under the Loan Documents. 2.3. Procedure for Revolving Credit Loan Borrowings Other than Competitive Bid Borrowings. (a) Revolving Credit Loans. Except for Revolving Credit Loans which the Borrower has requested be made as Competitive Bid Advances (as to which the provisions of Section 2.4 shall apply), and subject to the limitations set forth in Sections 2.1(a) and 2.3(c), the Borrower may borrow under the Commitments on any Business Day during the Revolving Credit Period by providing notice thereof in accordance with Section 2.3(b). (b) Borrowing Requests. To request Revolving Credit Loans pursuant to Section 2.3(a), the Borrower shall notify the Administrative Agent of such request by telephone (a) in the case of a Eurodollar Advance, not later than 12:00 P.M., New York City time, two Business Days before the date of the proposed borrowing of Revolving Credit Loans or (b) in the case of an ABR Advance, not later than 12:00 P.M., New York City time, one Business Day before the date of such proposed advance. Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Borrowing Request signed by the Borrower. Each such telephonic and written Borrowing Request shall specify the following information: (i) the aggregate amount of the requested borrowing of Revolving Credit Loans; (ii) the date of such borrowing of Revolving Credit Loans, which shall be a Business Day; (iii) whether the requested Revolving Credit Loan is to be an ABR Advance or a Eurodollar Advance; (iv) in the case of a Eurodollar Advance, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term "Interest Period"; and (v) the location and number of the Borrower's account to which funds are to be disbursed, which shall comply with the requirements of Section 2.3(d). (c) Limits on Advances. Each borrowing of (i) ABR Advances shall be in a minimum aggregate principal amount equal to $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the Available Commitment Amount, and (ii) Eurodollar Advances shall be in an aggregate principal amount equal to - 26 - 32 $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the Available Commitment Amount. (d) Funding of Revolving Credit Loans. Upon receipt of each notice of borrowing from the Borrower, the Administrative Agent shall promptly notify each Lender of the contents thereof. Subject to its receipt of the notice referred to in the preceding sentence, each Lender will make the amount of its Commitment Percentage of each borrowing of Revolving Credit Loans pursuant to this Section available to the Administrative Agent for the account of the Borrower at the office of the Administrative Agent set forth in Section 11.2 not later than 12:30 P.M. on the relevant Borrowing Date requested by the Borrower in funds immediately available to the Administrative Agent at such office. The amounts so made available to the Administrative Agent on the Borrowing Date will then, subject to the satisfaction of the terms and conditions of this Agreement, as determined by the Administrative Agent, be made available on such date to the Borrower by the Administrative Agent at the office of the Administrative Agent specified in Section 11.2 by crediting the account of the Borrower on the books of such office with the aggregate of said amounts received by the Administrative Agent. (e) Effect of Incomplete Borrowing Request. If no election is made as to the whether the Revolving Credit Loans shall be ABR Advances or Eurodollar Advances, then the requested Revolving Credit Loans shall be an ABR Advance. If no Interest Period is specified with respect to any requested borrowing of Eurodollar Advances, then the Borrower shall be deemed to have selected an Interest Period of one month's duration. (f) Administrative Agent's Assumption. Unless the Administrative Agent shall have received prior notice from a Lender (by telephone or otherwise, such notice to be promptly confirmed by telecopy or other writing) that such Lender will not make available to the Administrative Agent such Lender's pro rata share of the Revolving Credit Loans requested by the Borrower, the Administrative Agent may assume that such Lender has made such share available to the Administrative Agent on the Borrowing Date in accordance with this Section, provided that such Lender received notice of the proposed borrowing from the Administrative Agent, and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on the Borrowing Date a corresponding amount. If and to the extent such Lender shall not have so made such pro rata share available to the Administrative Agent, such Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount (to the extent not previously paid by the other), together with interest thereon for each day from the date such amount is made available to the Borrower until the date such amount is paid to the Administrative Agent, at a rate per annum equal to, in the case of the Borrower, the applicable interest rate set forth in Section 2.9 for ABR Advances or Eurodollar Advances, as set forth in the applicable Conventional Borrowing Request, and, in the case of such Lender, the Federal Funds - 27 - 33 Rate in effect on each such day (as determined by the Administrative Agent). Such payment by the Borrower, however, shall be without prejudice to its rights against such Lender. If such Lender shall pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender's Revolving Credit Loan as part of the Revolving Credit Loans for purposes of this Agreement, which Revolving Credit Loan shall be deemed to have been made by such Lender on the Borrowing Date applicable to such Revolving Credit Loans, but without prejudice to the Borrower's rights against such Lender. 2.4. Competitive Bid Borrowings and Procedure for Competitive Bid Borrowings. (a) Competitive Bid Borrowings. Subject to the terms and conditions of this Agreement, each Lender severally agrees that during any Rated Period, the Borrower may effect Competitive Bid Borrowings under this Section 2.4 from time to time on any Business Day during the Revolving Credit Period in the manner set forth below, provided, however, that the principal balance of all Competitive Bid Advances outstanding hereunder shall not at any time exceed the lesser of (x) the Competitive Bid Ceiling, and (y) the Total Commitment Amount less the outstanding principal balance of all Conventional Advances. (b) Procedure for Competitive Bid Borrowings. The Borrower may request a Competitive Bid Borrowing under this Section 2.4 during the Revolving Credit Period by giving to the Administrative Agent, not later than 12:00 P.M. at least three Business Days prior to the date of the proposed Competitive Bid Borrowing, a Competitive Bid Borrowing Request in the form of Exhibit C, specifying (i) the proposed date of the Competitive Bid Borrowing, (ii) the aggregate amount of the proposed Competitive Bid Borrowing (which amount shall not be less than $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof), (iii) the proposed Interest Period for the Competitive Bid Advances to be made as part of such Competitive Bid Borrowing (which Interest Period shall end not later than 5 days prior to the Revolving Credit Termination Date, and shall otherwise comply with the applicable provisions of the definition of "Interest Period"), and (iv) such other terms to be applicable to such Competitive Bid Borrowing as the Borrower may specify. The Administrative Agent shall promptly notify (by telephone or otherwise, to be promptly confirmed by telecopy or other writing) each Lender of each Competitive Bid Borrowing Request received by it and the terms contained in such Competitive Bid Borrowing Request. Such notice shall not be delivered separately to any Designated Lender, but shall be deemed delivered to a Designated Lender when delivered to the Designating Lender responsible for having appointed such Designated Lender as its Designated Lender. (c) Decision of Lenders to make Competitive Bid Advances. Each Lender may, if, in its sole discretion, it elects so to do, irrevocably offer to make one or - 28 - 34 more Revolving Credit Loans as Competitive Bid Advances to the Borrower as part of such proposed Competitive Bid Borrowing at a rate or rates of interest specified by such Lender in its sole discretion, by notifying (by telephone or otherwise, to be promptly confirmed by telecopy or other writing) the Administrative Agent, before 12:00 P.M. two Business Days before the Borrowing Date of such proposed Competitive Bid Borrowing of (i) the minimum amount and maximum amount of each Competitive Bid Advance which such Lender would be willing to make as part of such proposed Competitive Bid Borrowing (which amounts may, subject to the proviso to the first sentence of Section 2.4(a), exceed such Lender's Commitment), and (ii) the rate or rates of interest therefor and such Lender's Applicable Lending Office with respect to such Competitive Bid Advance, provided that any such offer made by a Designated Lender shall be made solely through the Designating Lender responsible for having appointed such Designated Lender as its Designated Lender. No Lender shall be required to specify in its Competitive Bid Advance offer whether such Competitive Bid Advance will be funded by its Designated Lender. The Administrative Agent shall notify the Borrower of all such offers before 12:30 P.M. two Business Days before such proposed Borrowing Date, provided that if BNY in its capacity as a Lender shall in its sole discretion elect to make any such offer, it shall notify the Borrower of such offer before 11:30 A.M. two Business Days before such proposed Borrowing Date. If any Lender other than BNY shall fail to notify the Administrative Agent before 12:00 P.M., and if BNY in its capacity as a Lender shall fail to notify the Borrower before 11:30 A.M., two Business Days before the proposed Borrowing Date, that it elects to make such an offer, such Lender shall be deemed to have elected not to make such an offer and such Lender shall not be obligated to, and shall not, make any Competitive Bid Advance as part of such Competitive Bid Borrowing. Any offer submitted after the time required above shall be disregarded by the Administrative Agent unless such offer is submitted to correct a manifest error in a prior offer. (d) Borrower's Acceptance or Cancellation. The Borrower shall, before 1:00 P.M. two Business Days before the date of such proposed Competitive Bid Borrowing, either (i) cancel such Competitive Bid Borrowing Request by notice to the Administrative Agent to that effect, or (ii) in its sole discretion, irrevocably accept one or more of the offers made by a Lender or Lenders pursuant to paragraph (c) above in ascending order of the rates offered therefor, by giving notice to the Administrative Agent of the amount of each Competitive Bid Advance (which amount shall be equal to or greater than the minimum amount, and equal to or less than the maximum amount, notified to the Borrower by the Administrative Agent on behalf of such Lender for such Competitive Bid Advance pursuant to paragraph (c)) to be made by each Lender as part of such Competitive Bid Borrowing, and reject any - 29 - 35 remaining offers made by Lenders pursuant to paragraph (c) above, by giving the Administrative Agent notice to that effect, provided, however, that the aggregate amount of such offers accepted by the Borrower shall be equal at least to $5,000,000. If offers for Competitive Bid Advances at the same interest rate are made by two or more Lenders pursuant to paragraph (c) above for a greater aggregate minimum principal amount than the amount in respect of which offers for Competitive Bid Advances are accepted by the Borrower at such interest rate, the principal amount of Competitive Bid Advances accepted at such interest rate shall be allocated by the Borrower among such Lenders as nearly as possible in proportion to the respective minimum principal amounts offered by such Lenders. No such Lender shall be obligated to make such Competitive Bid Advance in a principal amount less than the minimum amount offered by such Lender without consenting to such lesser amount. If any Lender declines to make a Competitive Bid Advance at such lesser amount, the Borrower shall be entitled in its sole discretion to determine which of such offers at the same interest rate it shall accept. If the Borrower notifies the Administrative Agent that a Competitive Bid Borrowing Request is cancelled pursuant to paragraph (d)(i) above, the Administrative Agent shall give prompt notice (by telephone or otherwise, to be promptly confirmed by telecopy or other writing) thereof to the Lenders and such Competitive Bid Borrowing shall not be made. If the Borrower accepts one or more of the offers made by any Lender or Lenders pursuant to paragraph (d)(ii) above, the Administrative Agent shall, as promptly as practicable on the second Business Day before such proposed Borrowing Date, notify (A) each Lender that has made an offer as described in paragraph (c) above, of the date and aggregate amount of such Competitive Bid Borrowing and whether any offer or offers made by such Lender pursuant to paragraph (c) above have been accepted by the Borrower and (B) each Lender whose offer to make a Competitive Bid Advance as part of such Competitive Bid Borrowing (a "Participating Lender") of the amount of each Loan to be made by such Lender as part of such Competitive Bid Borrowing has been accepted by the Borrower, together with a specification of the interest rate and Interest Payment Date or Dates in respect of each such Competitive Bid Advance. Each such Participating Lender shall, before 11:30 A.M. on the date of such Competitive Bid Borrowing make available, or cause its Designated Lender, if any, to make available, for the account of its Applicable Lending Office to the Administrative Agent at its address specified in Section 11.2 such Lender's portion of such Competitive Bid Borrowing, in funds immediately available to the Administrative Agent at such office. Competitive Bid Borrowings may be funded by a Lender's Designated Lender as provided in Section 11.8, however, the Designating Lender of such Designated Lender shall be responsible for making such Competitive Bid Advance should such Designated Lender - 30 - 36 fail to do so. Upon satisfaction of the applicable terms and conditions of this Agreement and after receipt by the Administrative Agent of such amount from each such Participating Lender, the Administrative Agent will make such amount available on such date to the Borrower at the office of the Administrative Agent specified in Section 11.2 by crediting the account of the Borrower on the books of such office with the aggregate of such amounts, in like funds as received by the Administrative Agent. After each Competitive Bid Borrowing, if requested by any Lender, the Administrative Agent shall within a reasonable time furnish to such Lender such information in respect of such Competitive Bid Borrowing as such Lender shall reasonably request. Unless the Administrative Agent shall have received prior notice from a Participating Lender (by telephone or otherwise, such notice to be promptly confirmed by telecopy or other writing) that such Participating Lender will not make available such Participating Lender's Competitive Bid Advance, the Administrative Agent may assume that such Participating Lender has made such Participating Lender's portion of such Competitive Bid Borrowing available to the Administrative Agent on such Borrowing Date in accordance with this Section, and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such Borrowing Date a corresponding amount. If and to the extent such Participating Lender shall not have made such portion available to the Administrative Agent, such Participating Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon for each day from the date such amount is made available to the Borrower until the date such amount is paid to the Administrative Agent at a rate per annum equal to, in the case of the Borrower, the rate of interest for such Competitive Bid Advance accepted by the Borrower in its notice to the Administrative Agent under Section 2.4(d)(ii), and, in the case of such Lender, the Federal Funds Rate in effect on such day (as determined by the Administrative Agent). Such payment by the Borrower, however, shall be without prejudice to its rights against such Participating Lender. If such Participating Lender shall pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender's Competitive Bid Advance as a part of such Competitive Bid Advances for purposes of this Agreement, which Competitive Bid Advance shall be deemed to have been made by such Participating Lender on the Borrowing Date applicable thereto, but without prejudice to the Borrower's rights against such Participating Lender. Notwithstanding its appointment of a Designated Lender, no Lender which is a Designating Lender shall be relieved of its obligation to fund a Competitive Bid Advance, and no Designated Lender shall be deemed to assume such obligation, prior to the time such Competitive Bid Advance is funded. (e) Subsequent Competitive Bid Borrowings Permitted. Within the limits and on the conditions set forth in this Section 2.4, the Borrower may from time to - 31 - 37 time borrow under this Section 2.4, repay pursuant to paragraph (f) below, and reborrow under this Section 2.4. (f) Repayment of Competitive Bid Borrowings. The Borrower shall repay to the Administrative Agent for the account of each Participating Lender which has made a Competitive Bid Advance on the last day of the Interest Period for such Competitive Bid Advance (such Interest Period being that specified by the Borrower in the related Competitive Bid Borrowing Request delivered pursuant to Section 2.4(b) above) the then unpaid principal amount of such Competitive Bid Advance. (g) Interest on Competitive Bid Borrowings. The Borrower shall pay interest on the unpaid principal balance of each Competitive Bid Advance from the date of such Competitive Bid Advance to the date the principal amount of such Competitive Bid Advance is repaid in full, at the rate of interest for such Competitive Bid Advance specified by the Participating Lender making (or whose Designated Lender made) such Competitive Bid Advance in such Participating Lender's notice with respect thereto delivered pursuant to Section 2.4(c) above payable on the Interest Payment Date specified by the Borrower for such Competitive Bid Advance in the related Competitive Bid Borrowing Request delivered pursuant to Section 2.4(b) above. Any Designated Lender which funds a Competitive Bid Advance shall on and after the time of such funding become the obligee under such Competitive Bid Advance. (h) Competitive Bid Notes. At the request of any Lender, the Borrower will deliver to such Lender a note, in the form mutually agreeable to such Lender and the Borrower, evidencing the obligation of the Borrower to pay the Competitive Bid Advances of such Lender, and interest thereon, in accordance with Section 2.4(f). (i) In General. Each Competitive Bid Advance shall be subject to all of the provisions of this Agreement generally, provided, however, that a Competitive Bid Advance shall not reduce a Lender's obligation to fund its Commitment Percentage of any ABR Advance or Eurodollar Advance. 2.5. Termination or Reduction of Commitments. (a) Voluntary Reductions. The Borrower shall have the right, upon at least three Business Days' prior written notice to the Administrative Agent, at any time to terminate the Commitments or from time to time to permanently reduce the Commitments, provided that (i) the total of the Commitments shall not be reduced below an amount equal to the sum of the aggregate principal balance of the Revolving Credit Loans then outstanding thereunder, and (ii) any such reduction of the Commitments shall be in the minimum amount of $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. - 32 - 38 (b) In General. Reductions of the Commitments shall be applied pro rata according to the Commitments of each Lender, as the case may be. Simultaneously with each reduction of the Commitments under this Section, the Borrower shall pay the Facility Fee accrued (but not yet paid) on the amount by which the Commitments have been reduced and prepay the Loans outstanding thereunder by the amount, if any, by which the aggregate unpaid principal balance of such Loans exceeds the amount of the Commitments, as so reduced. If any prepayment is made under this Section with respect to any Fixed Rate Advances, in whole or in part, prior to the last day of the applicable Interest Period, the Borrower agrees to indemnify the Lenders in accordance with Section 2.14. No reduction or termination of the Commitments may be reinstated. 2.6. Repayment of Loans; Evidence of Debt (a) Promise to Pay. The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Revolving Credit Loan and/or Term Loan, as the case may be, on the Maturity Date. Competitive Bid Borrowings shall be paid pursuant to Section 2.4. (b) Lenders' Accounts. Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the debt of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder. (c) Administrative Agent's Accounts. The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Revolving Credit Loan, Term Loan and Competitive Bid Borrowing made hereunder, the type of Advance thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any other sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender's share thereof. (d) Entries Made in Accounts. The entries made in the accounts maintained pursuant to paragraphs (b) and (c) of this Section shall, to the extent not inconsistent with any entries made in any Note and absent manifest error, be prima facie evidence of the existence and amounts of the obligations recorded therein, provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement. (e) Loans Evidenced by Notes. The Loans and interest thereon shall at all times (including after assignment pursuant to Section 11.7) be represented by one or more Notes in like form payable to the order of the payee named therein and its registered assigns. - 33 - 39 2.7. Prepayments of the Loans. (a) Voluntary Prepayments. The Borrower may, at its option, prepay the ABR Advances and Eurodollar Advances, in whole or in part, without premium or penalty (other than any indemnification amounts, as provided for in Section 2.14) at any time and from time to time by notifying the Administrative Agent in writing at least one Business Day prior to the proposed prepayment date in the case of Loans consisting of ABR Advances and at least three Business Days prior to the proposed prepayment date in the case of Loans consisting of Eurodollar Advances, specifying the Loans to be prepaid consisting of ABR Advances, Eurodollar Advances or a combination thereof, the amount to be prepaid and the date of prepayment. Such notice shall be irrevocable and the amount specified in such notice shall be due and payable on the date specified, together with accrued interest to the date of such payment on the amount prepaid. Upon receipt of such notice, the Administrative Agent shall promptly notify each Lender in respect thereof. Partial prepayments of ABR Advances and/or Eurodollar Advances shall be in an aggregate minimum principal amount of $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the outstanding principal balance thereof. After giving effect to any partial prepayment with respect to Eurodollar Advances which were made (whether as the result of a borrowing or a conversion) on the same date and which had the same Interest Period, the outstanding principal amount of such Eurodollar Advances shall be at least (subject to Section 2.3(c)) $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. Notwithstanding anything in this Agreement to the contrary, voluntary prepayments by the Borrower of Competitive Bid Advances are not permitted. (b) Term Loan. Any prepayments of the Term Loans shall not be readvanced. (c) In General. If any prepayment is made in respect of any Fixed Rate Advance, in whole or in part, prior to the last day of the applicable Interest Period, the Borrower agrees to indemnify the Lenders in accordance with Section 2.14. 2.8. Conversions. (a) Conversion Elections. The Borrower may elect from time to time to convert Eurodollar Advances to ABR Advances by giving the Administrative Agent at least one Business Day's prior irrevocable notice of such election, specifying the amount to be so converted, provided, that any such conversion of Eurodollar Advances shall only be made on the last day of the Interest Period applicable thereto. In addition, the Borrower may elect from time to time to convert ABR Advances to Eurodollar Advances or to convert Eurodollar Advances to new Eurodollar Advances by giving the Administrative Agent at least two Business Days' prior irrevocable notice of such election, specifying the amount to be so converted and the initial Interest Period relating - 34 - 40 thereto, provided that any such conversion of ABR Advances to Eurodollar Advances shall only be made on a Business Day and any such conversion of Eurodollar Advances to new Eurodollar Advances shall only be made on the last day of the Interest Period applicable to the Eurodollar Advances which are to be converted to such new Eurodollar Advances. Each such notice shall be in the form of Exhibit M and must be delivered to the Administrative Agent prior to 12:00 noon on the Business Day required by this Section for the delivery of such notices to the Administrative Agent. The Administrative Agent shall promptly provide the Lenders with notice of any such election. ABR Advances and Eurodollar Advances may be converted pursuant to this Section in whole or in part, provided that conversions of ABR Advances to Eurodollar Advances, or Eurodollar Advances to new Eurodollar Advances, shall be in an aggregate principal amount of $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. This Section shall not apply to Competitive Bid Borrowings, which may not be converted or continued beyond the Interest Period applicable thereto. (b) Effect on Conversions if an Event of Default. Notwithstanding anything in this Section to the contrary, no ABR Advance may be converted to a Eurodollar Advance, and no Eurodollar Advance may be converted to a new Eurodollar Advance, if a Default or Event of Default has occurred and is continuing either (i) at the time the Borrower shall notify the Administrative Agent of its election to convert or (ii) on the requested Conversion Date. In such event, such ABR Advance shall be automatically continued as an ABR Advance or such Eurodollar Advance shall be automatically converted to an ABR Advance on the last day of the Interest Period applicable to such Eurodollar Advance. If an Event of Default shall have occurred and be continuing, the Administrative Agent shall, at the request of the Required Lenders, notify the Borrower (by telephone or otherwise) that all, or such lesser amount as the Required Lenders shall designate, of the outstanding Eurodollar Advances shall be automatically converted to ABR Advances, in which event such Eurodollar Advances shall be automatically converted to ABR Advances on the date such notice is given. (c) Conversion not a Borrowing. Each conversion shall be effected by each Lender by applying the proceeds of its new ABR Advance or Eurodollar Advance, as the case may be, to its Advances (or portion thereof) being converted (it being understood that such conversion shall not constitute a borrowing for purposes of Sections 4, 5 or 6). 2.9. Interest Rate and Payment Dates. (a) Prior to Maturity. Except as otherwise provided in Section 2.9(b), prior to the Maturity Date, the Loans shall bear interest on the outstanding principal balance thereof at the applicable interest rate or rates per annum set forth below: - 35 - 41
ADVANCES RATE -------- ---- Each ABR Advance Alternate Base Rate. Each Eurodollar Eurodollar Rate for the applicable Interest Period plus the Advance Applicable Margin. Competitive Bid The rate for the applicable Competitive Bid Advance Advance determined pursuant to Section 2.4.
(b) Event of Default. After the occurrence and during the continuance of an Event of Default, the outstanding principal balance of the Loans and any overdue interest or other amount payable under the Loan Documents shall bear interest, whether before or after the entry of any judgment thereon, at a rate per annum equal to the Alternate Base Rate plus 2%. (c) Interest Payment Dates. Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan, provided that (i) interest accrued pursuant to paragraph (b) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Advance prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion. (d) General. Interest on (i) ABR Advances, to the extent based on the BNY Rate, shall be calculated on the basis of a 365 or 366-day year (as the case may be), and (ii) ABR Advances, to the extent based on the Federal Funds Rate, Eurodollar Advances and Competitive Bid Advances shall be calculated on the basis of a 360-day year, in each case for the actual number of days elapsed, including the first day but excluding the last. Any change in the interest rate on the Loans resulting from a change in the Alternate Base Rate or a Pricing Level shall become effective as of the opening of business on the day on which such change shall become effective. The Administrative Agent shall, as soon as practicable, notify the Borrower and the Lenders of the effective date and the amount of each such change in the Alternate Base Rate or a Pricing Level, but any failure to so notify shall not in any manner affect the obligation of the Borrower to pay interest on the Loans in the amounts and on the dates required. Each determination of the Alternate Base Rate, a Eurodollar Rate or a Pricing Level by the Administrative Agent pursuant to this Agreement shall be conclusive and binding on the Borrower and the Lenders absent manifest error. At no time shall the interest rate payable on the Loans of any Lender, together with the Facility Fee and all other amounts - 36 - 42 payable under the Loan Documents, to the extent the same are construed to constitute interest, exceed the Highest Lawful Rate. If interest payable to a Lender on any date would exceed the maximum amount permitted by the Highest Lawful Rate, such interest payment shall automatically be reduced to such maximum permitted amount, and interest for any subsequent period, to the extent less than the maximum amount permitted for such period by the Highest Lawful Rate, shall be increased by the unpaid amount of such reduction. Any interest actually received for any period in excess of such maximum allowable amount for such period shall be deemed to have been applied as a prepayment of the Loans. The Borrower acknowledges that to the extent interest payable on ABR Advances is based on the BNY Rate, the BNY Rate is only one of the bases for computing interest on loans made by the Lenders, and by basing interest payable on ABR Advances on the BNY Rate, the Lenders have not committed to charge, and the Borrower has not in any way bargained for, interest based on a lower or the lowest rate at which the Lenders may now or in the future make loans to other borrowers. 2.10. Substituted Interest Rate. In the event that (i) the Administrative Agent shall have reasonably determined (which determination shall be conclusive and binding upon the Borrower) that by reason of circumstances affecting the interbank eurodollar market either adequate and reasonable means do not exist for ascertaining the Eurodollar Rate applicable pursuant to Section 2.9 or (ii) the Required Lenders shall have notified the Administrative Agent that they have reasonably determined (which determination shall be conclusive and binding on the Borrower) that the applicable Eurodollar Rate will not adequately and fairly reflect the cost to such Lenders of maintaining or funding loans bearing interest based on such Eurodollar Rate, with respect to any portion of the Loans that the Borrower has requested be made as Eurodollar Advances or Eurodollar Advances that will result from the requested conversion of any portion of the Advances into Eurodollar Advances (each, an "Affected Advance"), the Administrative Agent shall promptly notify the Borrower and the Lenders (by telephone or otherwise, to be promptly confirmed in writing) of such determination, on or, to the extent practicable, prior to the requested Borrowing Date or Conversion Date for such Affected Advances. If the Administrative Agent shall give such notice, (a) any Affected Advances shall be made as ABR Advances, (b) the Advances (or any portion thereof) that were to have been converted to Affected Advances shall be converted to or continued as ABR Advances and (c) any outstanding Affected Advances shall be converted, on the last day of the then current Interest Period with respect thereto, to ABR Advances. Until any notice under clauses (i) or (ii), as the case may be, of this Section has been withdrawn by the Administrative Agent (by notice to the Borrower promptly upon either (x) the Administrative Agent having determined that such circumstances affecting the interbank eurodollar market no longer exist and that adequate and reasonable means do exist for determining the Eurodollar Rate pursuant to Section 2.9 or (y) the Administrative Agent - 37 - 43 having been notified by such Required Lenders that circumstances no longer render the Advances (or any portion thereof) Affected Advances), no further Eurodollar Advances shall be required to be made by the Lenders nor shall the Borrower have the right to convert all or any portion of the Loans to Eurodollar Advances. 2.11. Taxes; Net Payments. (a) All payments made by the Borrower or Subsidiary Guarantor under the Loan Documents shall be made free and clear of, and without reduction for or on account of, any taxes, levies, imposts, deductions, charges or withholdings required by law to be withheld from any amounts payable under the Loan Documents. A statement setting forth the calculations of any amounts payable pursuant to this paragraph submitted by a Lender to the Borrower shall be conclusive absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. (b) Each Lender which is a foreign corporation within the meaning of Section 1442 of the Code shall deliver to the Borrower such certificates, documents or other evidence as the Borrower may reasonably require from time to time as are necessary to establish that such Lender is not subject to withholding under Section 1441 or 1442 of the Code or as may be necessary to establish, under any law hereafter imposing upon the Borrower, an obligation to withhold any portion of the payments made by the Borrower under the Loan Documents, that payments to the Administrative Agent on behalf of such Lender are not subject to withholding. 2.12. Illegality. Notwithstanding any other provisions herein, if any law, regulation, treaty or directive hereafter enacted, promulgated, approved or issued, or any change in any presently existing law, regulation, treaty or directive, or in the interpretation or application thereof, shall make it unlawful for any Lender to make or maintain its Eurodollar Advances as contemplated by this Agreement, such Lender shall so notify the Administrative Agent and the Administrative Agent shall forthwith give notice thereof to the other Lenders and the Borrower, whereupon (i) the commitment of such Lender hereunder to make Eurodollar Advances or convert ABR Advances to Eurodollar Advances shall forthwith be suspended and (ii) such Lender's Loans then outstanding as Eurodollar Advances affected hereby, if any, shall be converted automatically to ABR Advances on the last day of the then current Interest Period applicable thereto or within such earlier period as required by law. If the commitment of any Lender with respect to Eurodollar Advances is suspended pursuant to this Section and thereafter it is once again legal for such Lender to make or maintain Eurodollar Advances, such Lender's commitment to make or maintain Eurodollar Advances shall be reinstated and such - 38 - 44 Lender shall notify the Administrative Agent and the Borrower of such event. Notwithstanding the foregoing, to the extent that the conditions giving rise to the notice requirement set forth in this Section can be eliminated by the transfer of such Credit Party's Loans or Commitment to another of its branches, and to the extent that such transfer is not inconsistent with such Credit Party's internal policies of general application and only if, as determined by such Credit Party in its sole discretion, the transfer of such Loan or Commitment, as the case may be, would not otherwise adversely affect such Loans or such Credit Party, the Borrower may request, and such Lender shall use reasonable efforts to effect, such transfer. 2.13. Increased Costs. In the event that any law, regulation, treaty or directive hereafter enacted, promulgated, approved or issued or any change in any presently existing law, regulation, treaty or directive therein or in the interpretation or application thereof by any Governmental Authority charged with the administration thereof or compliance by any Credit Party (or any corporation directly or indirectly owning or controlling such Credit Party) with any request or directive, whether or not having the force of law, from any central bank or other Governmental Authority, agency or instrumentality: (a) does or shall subject any Credit Party to any Taxes of any kind whatsoever with respect to any Eurodollar Advances or its obligations under this Agreement to make Eurodollar Advances, or change the basis of taxation of payments to any Credit Party of principal, interest or any other amount payable hereunder in respect of its Eurodollar Advances, including any Taxes required to be withheld from any amounts payable under the Loan Documents (except for imposition of, or change in the rate of, tax on the overall net income of such Credit Party or its Applicable Lending Office for any of such Advances by the jurisdiction in which such Credit Party is incorporated or has its principal office or such Applicable Lending Office, including, in the case of Credit Parties incorporated in any State of the United States, such tax imposed by the United States); or (b) does or shall impose, modify or make applicable any reserve, special deposit, compulsory loan, assessment, increased cost or similar requirement against assets held by, or deposits of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Credit Party in respect of its Eurodollar Advances, which, in the case of Eurodollar Advances, is not otherwise included in the determination of the Eurodollar Rate; and the result of any of the foregoing is to increase the cost to such Credit Party of making, issuing, renewing, converting or maintaining its Eurodollar Advances or its commitment to make such Eurodollar Advances, or to reduce any amount receivable hereunder in respect of its Eurodollar Advances, then, in any such case, the Borrower - 39 - 45 shall pay such Credit Party, upon its demand, any additional amounts necessary to compensate such Credit Party for such additional cost or reduction in such amount receivable which such Credit Party deems to be material as determined by such Credit Party; provided, however, that nothing in this Section shall require the Borrower to indemnify the Credit Parties with respect to withholding Taxes for which the Borrower has no obligation under Section 2.11. No failure by any Credit Party to demand compensation for any increased cost during any Interest Period shall constitute a waiver of such Credit Party's right to demand such compensation at any time. A statement setting forth the calculations of any additional amounts payable pursuant to the foregoing sentence submitted by a Credit Party to the Borrower shall be conclusive absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and any of the Commitments or the payment of the Notes and all other amounts payable under the Loan Documents. Failure to demand compensation pursuant to this Section shall not constitute a waiver of such Credit Party's right to demand such compensation. To the extent that any increased costs of the type referred to in this Section are being incurred by a Credit Party and such costs can be eliminated or reduced by the transfer of such Credit Party's Loans or Commitment to another of its branches, and to the extent that such transfer is not inconsistent with such Credit Party's internal policies of general application and only if, as determined by such Credit Party in its sole discretion, the transfer of such Loan or Commitment, as the case may be, would not otherwise materially adversely affect such Loan or such Credit Party, the Borrower may request, and such Lender shall use reasonable efforts to effect, such transfer. 2.14. Indemnification for Break Funding Losses. Notwithstanding anything contained herein to the contrary, if (i) the Borrower shall fail to borrow or convert on a Borrowing Date or Conversion Date after it shall have given notice to do so in which it shall have requested a Eurodollar Advance pursuant to Section 2.3 or 2.8, (ii) the Borrower shall fail to borrow after having accepted one or more offers of Competitive Bid Advances under Section 2.4, or (iii) a Eurodollar Advance or Competitive Bid Advance shall be terminated or prepaid for any reason prior to the last day of the Interest Period applicable thereto (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality), the Borrower agrees to indemnify each Credit Party against, and to pay on demand directly to such Credit Party, any loss or expense suffered by such Credit Party as a result of such failure to borrow or convert, or such termination or repayment, including, without limitation, an amount, if greater than zero, equal to: A x (B-C) x D --- 360 where: - 40 - 46 "A" equals such Credit Party's pro rata share of the Affected Principal Amount; "B" equals the applicable Eurodollar Rate or the rate which such Competitive Bid Advance bears to such Loan, as the case may be; "C" equals the applicable Eurodollar Rate or Proposed Bid Rate (in each case expressed as a decimal), as the case may be, in effect on or about the first day of the applicable Remaining Interest Period, based on the applicable rates offered or bid, as the case may be, on or about such date, for deposits (or in the case of a Proposed Bid Rate, based on the rate such Credit Party would have quoted) in an amount equal approximately to such Credit Party's pro rata share of the Affected Principal Amount with an Interest Period equal approximately to the applicable Remaining Interest Period, as determined by such Credit Party; "D" equals the number of days from and including the first day of the applicable Remaining Interest Period to but excluding the last day of such Remaining Interest Period; and any other out-of-pocket loss or expense (including any internal processing charge customarily charged by such Credit Party) suffered by such Credit Party in connection with such Eurodollar Advance or Competitive Bid Advance, including, without limitation, in liquidating or employing deposits acquired to fund or maintain the funding of its pro rata share of the Affected Principal Amount, or redeploying funds prepaid or repaid, in amounts which correspond to its pro rata share of the Affected Principal Amount. A statement setting forth the calculations of any amounts payable pursuant to this Section submitted by a Credit Party to the Borrower shall be conclusive and binding on the Borrower absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 2.15. Use of Proceeds. The proceeds of Loans shall be used solely for general business purposes, and such use shall conform to the provisions of Section 4.11, provided that the first Loans hereunder shall be applied to pay in full any loans outstanding under the Existing Credit Agreements, together with all interest, fees, breakage costs and other amounts outstanding thereunder. - 41 - 47 2.16. Capital Adequacy. If (i) after the date hereof, the enactment or promulgation of, or any change or phasing in of, any United States or foreign law or regulation or in the interpretation thereof by any Governmental Authority charged with the administration thereof, (ii) compliance with any directive or guideline from any central bank or United States or foreign Governmental Authority (whether or not having the force of law) promulgated or made after the date hereof, or (iii) compliance with the Risk-Based Capital Guidelines of the Board of Governors of the Federal Reserve System as set forth in 12 CFR Parts 208 and 225, or of the Comptroller of the Currency, Department of the Treasury, as set forth in 12 CFR Part 3, or similar legislation, rules, guidelines, directives or regulations under any applicable United States or foreign Governmental Authority affects or would affect the amount of capital required to be maintained by a Credit Party (or any lending office of such Credit Party) or any corporation directly or indirectly owning or controlling such Credit Party or imposes any restriction on or otherwise adversely affects such Credit Party (or any lending office of such Credit Party) or any corporation directly or indirectly owning or controlling such Credit Party and such Credit Party shall have reasonably determined that such enactment, promulgation, change or compliance has the effect of reducing the rate of return on such Credit Party's capital or the asset value to such Credit Party of any Loan made by such Credit Party as a consequence, directly or indirectly, of its obligations to make and maintain the funding of its Loans at a level below that which such Credit Party could have achieved but for such enactment, promulgation, change or compliance (after taking into account such Credit Party's policies regarding capital adequacy) by an amount deemed by such Credit Party to be material, then, upon demand by such Credit Party, the Borrower shall promptly pay to such Credit Party such additional amount or amounts as shall be sufficient to compensate such Credit Party for such reduction in such rate of return or asset value. A certificate in reasonable detail as to such amounts submitted to the Borrower and the Administrative Agent setting forth the determination of such amount or amounts that will compensate such Credit Party for such reductions shall be presumed correct absent manifest error. No failure by any Credit Party to demand compensation for such amounts hereunder shall constitute a waiver of such Credit Party's right to demand such compensation at any time. Such Credit Party shall, however, use reasonable efforts to notify the Borrower of such claim within 90 days after the officer of such Credit Party having primary responsibility for this Agreement has obtained knowledge of the events giving rise to such claim. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 2.17. Administrative Agent's Records. The Administrative Agent's records with respect to the Loans, the interest rates applicable thereto, each payment by the Borrower of principal and interest on the - 42 - 48 Loans, and fees, expenses and any other amounts due and payable in connection with this Agreement shall be presumptively correct absent manifest error as to the amount of the Loans, and the amount of principal and interest paid by the Borrower in respect of such Loans and as to the other information relating to the Loans, and amounts paid and payable by the Borrower hereunder and under the Notes. The Administrative Agent will when requested by the Borrower advise the Borrower of the principal and interest outstanding under the Loans as of the date of such request and the dates on which such payments are due. 2.18. Extension of Revolving Credit Termination Date. Provided that no Default or Event of Default exists during the periods set forth below, the Borrower may request an extension of the Revolving Credit Termination Date, such extension to be for a period of no more than 364 days. The Borrower shall give notice of such request to the Administrative Agent at least 60 days prior to the then current Revolving Credit Termination Date. Such extension of the Revolving Credit Termination Date is subject to the written consent of the Administrative Agent, the Co-Documentation Agents and each Lender, the same to be evidenced by an appropriate amendment to this Agreement duly executed by the Borrower, the Administrative Agent, the Co-Documentation Agents and each Lender, and acknowledged and consented to by each Subsidiary Guarantor. Each Lender, the Administrative Agent and the Co-Documentation Agents agree to use reasonable efforts to respond to the Borrower's request for an extension of the Revolving Credit Termination Date at least 30 days before the Revolving Credit Termination Date, provided, however, that the failure of any Lender, the Administrative Agent or the Co-Documentation Agents to so respond shall not create any claim against it or be construed as such Person's consent to an extension of the Revolving Credit Termination Date (and any such failure to respond 30 days before the Revolving Credit Termination Date shall be deemed to be such Persons refusal to consent to such extension). 3. FEES; PAYMENTS 3.1. Facility Fee. (a) The Borrower agrees to pay to the Administrative Agent, for the account of the Lenders in accordance with each Lender's Commitment Percentage, a fee (the "Facility Fee"), from the Effective Date through the Maturity Date, computed as follows: during the Revolving Credit Period and while any Term Loans are outstanding, an amount, determined periodically as hereinafter set forth, equal to the product of (i) the Applicable Facility Fee Percentage times (ii) the average daily Total Commitment Amount (during each such period included in the Revolving Credit Period), or the average daily outstanding principal balance of all Term Loans (during each such period - 43 - 49 after the Revolving Credit Loans are converted to Term Loans as contemplated by Section 2.1(b)), as the case may be. The Facility Fee shall be payable quarterly in arrears on the last day of each March, June, September and December of each year, commencing on the first such day following the Effective Date, on any optional reduction of the Total Commitment Amount, and on the Maturity Date. The Facility Fee (and the Applicable Facility Fee Percentage) shall be calculated on the basis of a 360 day year for the actual number of days elapsed without regard to the amount of Loans outstanding during any period for which the Facility Fee is computed. (b) The Borrower agrees to pay any other fees payable to any Credit Party under any separate agreement at the times so agreed upon in such separate agreements. (c) The Facility Fee shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution directly to the Credit Party to whom such Facility Fee is payable. The Facility Fee shall not be refundable under any circumstances. 3.2. Payments; Application of Payments. Each payment, including each prepayment, of principal and interest on the Loans and the Facility Fee shall be made by the Borrower to the Administrative Agent, without set-off, deduction or counterclaim, at its office set forth in Section 11.2 in funds immediately available to the Administrative Agent at such office by 12:00 noon on the due date for such payment. Promptly upon receipt thereof by the Administrative Agent, the Administrative Agent shall remit, in like funds as received, (i) to the Lenders who maintain any of their Loans as ABR Advances or Eurodollar Advances, each such Lender's pro rata share of such payments which are in respect of principal or interest due on such ABR Advances or Eurodollar Advances, (ii) to the Lenders who maintain any of their Revolving Credit Loans as Competitive Bid Advances, each such Lender's pro rata share of such payments which are in respect of principal or interest due on such Competitive Bid Advances in accordance with Sections 2.4(c) and (d), and (iii) in the case of the Facility Fee, to all Lenders pro rata according to each Lender's Commitment Percentage thereof. The failure of the Borrower to make any such payment by such time shall not constitute a default hereunder, provided that such payment is made on such due date, but any such payment made after 12:00 noon on such due date shall be deemed to have been made on the next Business Day for the purpose of calculating interest on amounts outstanding on the Loans. If any payment hereunder or under the Notes shall be due and payable on a day which is not a Business Day, the due date thereof (except as otherwise provided in the definition of Interest Period) shall be extended to the next Business Day and (except with respect to payments in respect of the Facility Fee) interest shall be payable at the applicable rate specified herein during such extension. If any payment is made with respect to any Eurodollar Advance or Competitive Bid Advance - 44 - 50 prior to the last day of the applicable Interest Period, the Borrower shall indemnify each Lender in accordance with Section 2.14. 4. REPRESENTATIONS AND WARRANTIES In order to induce the Administrative Agent and the Lenders to enter into this Agreement and to make the Loans the Borrower makes the following representations and warranties to the Administrative Agent and each Lender: 4.1. Existence and Power. (a) The Borrower is a Maryland corporation duly organized and validly existing and in good standing under the laws of Maryland, has all requisite power and authority to own its Property and to carry on its business as now conducted, and is in good standing and authorized to do business in each jurisdiction in which the nature of the business conducted therein or the Property owned therein make such qualification necessary, except where such failure to qualify could not reasonably be expected to have a Material Adverse Effect. (b) Each Subsidiary of the Borrower (including each Subsidiary Guarantor) is a corporation, partnership, limited liability company, real estate investment trust or business trust, is validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to own its Property and to carry on its business as now conducted, and is in good standing and authorized to do business in each other jurisdiction in which the nature of the business conducted therein or the Property owned therein make such qualification necessary, except where such failure to qualify could not reasonably be expected to have a Material Adverse Effect. 4.2. Authority. The Borrower has full legal power and authority to enter into, execute, deliver and perform the terms of the Loan Documents to which it is a party and to make the borrowings contemplated thereby, to execute, deliver and carry out the terms of the Notes and to incur the obligations provided for herein and therein, all of which have been duly authorized by all proper and necessary corporate action. 4.3. Binding Agreement. (a) The Loan Documents to which the Borrower is a party constitute the valid and legally binding obligations of the Borrower, enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable - 45 - 51 bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights generally. (b) The execution, delivery and performance by the Borrower of the Loan Documents to which it is a party does not violate the provisions of any applicable statute, law (including, without limitation, any applicable usury or similar law), rule or regulation of any Governmental Authority. 4.4. Subsidiaries; DownREIT Partnerships. As of the Effective Date, the Borrower has only the Subsidiaries set forth on Schedule 4.4. Schedule 4.4 sets forth the name of, and the ownership interest of the Borrower in, each Subsidiary of the Borrower and identifies each Subsidiary that is a Subsidiary Guarantor, in each case as of the Effective Date. The shares of each corporate Subsidiary of the Borrower that are owned by the Borrower are duly authorized, validly issued, fully paid and nonassessable and are owned free and clear of any Liens. The interest of the Borrower in each non-corporate Subsidiary is owned free and clear of any Liens (other than Liens applicable to a partner under the terms of any partnership agreement to secure the Borrower's obligation to make capital contributions or similar payments thereunder). As of the Effective Date, the only DownREIT Partnerships are Excel Realty Partners, L.P. and E.H. Properties, L.P. 4.5. Litigation. (a) There are no actions, suits or proceedings at law or in equity or by or before any Governmental Authority (whether or not purportedly on behalf of the Borrower or any Subsidiary of the Borrower) pending or, to the knowledge of the Borrower, threatened against the Borrower or any Subsidiary of the Borrower or any of their respective Properties or rights, which (i) if adversely determined, could reasonably be expected to have a Material Adverse Effect, (ii) call into question the validity or enforceability of any of the Loan Documents, or (iii) could reasonably be expected to result in the rescission, termination or cancellation of any franchise, right, license, permit or similar authorization held by the Borrower or any Subsidiary of the Borrower, which rescission, termination or cancellation could reasonably be expected to have a Material Adverse Effect. (b) As of the date hereof, Schedule 4.5 sets forth all actions, suits and proceedings at law or in equity or by or before any Governmental Authority (whether or not purportedly on behalf of the Borrower or any Subsidiary of the Borrower) pending or, to the knowledge of the Borrower, threatened against the Borrower, any Subsidiary of the Borrower or any of their respective Properties or rights which, if adversely determined, could have a Material Adverse Effect. - 46 - 52 4.6. Required Consents. No consent, authorization or approval of, filing with, notice to, or exemption by, stockholders, any Governmental Authority or any other Person not obtained is required to be obtained by the Borrower to authorize, or is required in connection with the execution, delivery and performance of the Loan Documents or is required to be obtained by the Borrower as a condition to the validity or enforceability of the Loan Documents. 4.7. No Conflicting Agreements. Neither the Borrower nor any Subsidiary of the Borrower is in default beyond any applicable grace or cure period under any mortgage, indenture, contract or agreement to which it is a party or by which it or any of its Property is bound, the effect of which default could reasonably be expected to have a Material Adverse Effect. The execution, delivery or carrying out of the terms of the Loan Documents will not constitute a default under, or result in the creation or imposition of, or obligation to create, any Lien upon any Property of the Borrower or any Subsidiary of the Borrower pursuant to the terms of any such mortgage, indenture, contract or agreement. 4.8. Compliance with Applicable Laws. Neither the Borrower nor any Subsidiary of the Borrower is in default with respect to any judgment, order, writ, injunction, decree or decision of any Governmental Authority which default could reasonably be expected to have a Material Adverse Effect. The Borrower and each Subsidiary of the Borrower is in compliance in all material respects with all statutes, regulations, rules and orders applicable to Borrower or such Subsidiary of all Governmental Authorities, including, without limitation, (i) Environmental Laws and ERISA, a violation of which could reasonably be expected to have a Material Adverse Effect and (ii) Sections 856-860 of the Code, compliance with which is required to preserve the Borrower's status as a REIT. 4.9. Taxes. Each of the Borrower and its Subsidiaries has filed or caused to be filed all tax returns required to be filed and has paid, or has filed appropriate extensions and has made adequate provision for the payment of, all taxes shown to be due and payable on said returns or in any assessments made against it (other than those being contested as permitted under Section 7.4) in which the failure to pay could reasonably be expected to have a Material Adverse Effect, and no tax Liens have been filed with respect thereto. The charges, accruals and reserves on the books of the Borrower and each Subsidiary of the Borrower with respect to all federal, state, local and other taxes are, to the best knowledge of the Borrower, adequate for the payment of all such taxes, and the - 47 - 53 Borrower knows of no unpaid assessment which is due and payable against it or any of its Subsidiaries or any claims being asserted which could reasonably be expected to have a Material Adverse Effect. 4.10. Governmental Regulations. Neither the Borrower nor any Subsidiary of the Borrower is subject to regulation under the Public Utility Holding Company Act of 1935, as amended, the Federal Power Act, as amended, or the Investment Company Act of 1940, as amended, and neither the Borrower nor any Subsidiary of the Borrower is subject to any statute or regulation which prohibits or restricts the incurrence of Indebtedness under the Loan Documents, including, without limitation, statutes or regulations relative to common or contract carriers or to the sale of electricity, gas, steam, water, telephone, telegraph or other public utility services. 4.11. Federal Reserve Regulations; Use of Loan Proceeds. Neither the Borrower nor any Subsidiary of the Borrower is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. No part of the proceeds of the Loans will be used, directly or indirectly, for a purpose which violates any law, rule or regulation of any Governmental Authority, including, without limitation, the provisions of Regulations T, U or X of the Board of Governors of the Federal Reserve System, as amended. No part of the proceeds of the Loans will be used, directly or indirectly, to purchase or carry Margin Stock or to extend credit to others for the purpose of purchasing or carrying Margin Stock. 4.12. Plans; Multiemployer Plans. As of the Effective Date, each of the Borrower and its ERISA Affiliates maintains or makes contributions only to the Plans and Multiemployer Plans listed on Schedule 4.12. Each Plan, and, to the best knowledge of the Borrower, each Multiemployer Plan, is in compliance in all material respects with, and has been administered in all material respects in compliance with, the applicable provisions of ERISA, the Code and any other applicable Federal or state law, and no event or condition is occurring or exists concerning which the Borrower would be under an obligation to furnish a report to the Administrative Agent and each Lender as required by Section 7.2(d). As of December 31, 1998, each Plan was "fully funded", which for purposes of this Section means that the fair market value of the assets of such Plan is not less than the present value of the accrued benefits of all participants in the Plan, computed on a plan termination basis. To the best knowledge of the Borrower, no Plan has ceased being fully funded. - 48 - 54 4.13. Financial Statements. The Borrower has heretofore delivered to the Administrative Agent and the Lenders (i) copies of the audited Consolidated Balance Sheet of the Borrower and its Consolidated Subsidiaries as of December 31, 1998, and the related Consolidated Statements of Operations, Stockholders' Equity and Cash Flows for the Borrower and its Consolidated Subsidiaries for the five months ended December 31, 1998 and the 12 months ended July 31, 1998, and (ii) the Consolidated Statements of Income and Cash Flows for the Borrower and its Consolidated Subsidiaries for the fiscal quarters of the Borrower ending March 31, 1999 and June 30, 1999, certified by its Chief Financial Officer (collectively, with the related notes and schedules, the "Financial Statements"). The Financial Statements fairly present the Consolidated financial condition and results of the operations of the Borrower and its Consolidated Subsidiaries as of the dates and for the periods indicated therein and have been prepared in conformity with GAAP. Except as reflected in the Financial Statements or in the notes thereto, neither the Borrower nor any Subsidiary of the Borrower has any obligation or liability of any kind (whether fixed, accrued, contingent, unmatured or otherwise) which, in accordance with GAAP, should have been shown on the Financial Statements and was not. Since June 30, 1999 through the Effective Date there has been no material adverse change in the financial condition or business of the Borrower and its Subsidiaries taken as a whole. 4.14. Property. Each of the Borrower and its Subsidiaries has good and marketable title to all of its Property, title to which is material to the Borrower or such Subsidiary, subject to no Liens, except Permitted Liens. There are no unpaid or outstanding real estate or similar taxes or assessments on or against any Real Property other than (i) real estate or other taxes or assessments that are not yet due and payable, and (ii) such taxes as the Borrower or any Subsidiary of the Borrower is contesting in good faith or which individually or in the aggregate could not reasonably be expected to have a Materially Adverse Effect. There are no pending eminent domain proceedings against any Real Property, and, to the knowledge of the Borrower, no such proceedings are presently threatened or contemplated by any Governmental Authority against any Real Property, which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect. None of the Real Property is now damaged as a result of any fire, explosion, accident, flood or other casualty which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect. 4.15. Franchises, Intellectual Property, Etc. Each of the Borrower and its Subsidiaries possesses or has the right to use all franchises, Intellectual Property, licenses and other rights, in each case that are material and necessary for the conduct of its business, with no known conflict with the - 49 - 55 valid rights of others which could reasonably be expected to have a Material Adverse Effect. No event has occurred which permits or, to the best knowledge of the Borrower, after notice or the lapse of time or both, or any other condition, could reasonably be expected to permit, the revocation or termination of any such franchise, Intellectual Property, license or other right and which revocation or termination could reasonably be expected to have a Material Adverse Effect. 4.16. Environmental Matters. (a) The Borrower and each of its Subsidiaries is in compliance with the requirements of all applicable Environmental Laws except for such non-compliance which could not, either individually or in the aggregate, be reasonably expected to have a Material Adverse Effect. (b) No Hazardous Substances have been (i) generated or manufactured on, transported to or from, treated at, stored at or discharged from any Real Property in violation of any Environmental Laws; (ii) discharged into subsurface waters under any Real Property in violation of any Environmental Laws; or (iii) discharged from any Real Property on or into property or waters (including subsurface waters) adjacent to any Real Property in violation of any Environmental Laws, which violation, in the case of either (i), (ii) or (iii) could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. (c) Neither the Borrower nor any of its Subsidiaries (i) has received notice (written or oral) or otherwise learned of any claim, demand, suit, action, proceeding, event, condition, report, directive, lien, violation, non-compliance or investigation indicating or concerning any potential or actual liability (including, without limitation, potential liability for enforcement, investigatory costs, cleanup costs, government response costs, removal costs, remedial costs, natural resources damages, property damages, personal injuries or penalties) arising in connection with (x) any non-compliance with or violation of the requirements of any applicable Environmental Laws, or (y) the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by - 50 - 56 the Borrower or any Subsidiary of the Borrower) or the release or threatened release of any Hazardous Substance into the environment which, in either case, could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (ii) has any threatened or actual liability in connection with the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by the Borrower or any Subsidiary of the Borrower) or the release or threatened release of any Hazardous Substance into the environment which, in either case, could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (iii) has received notice of any federal or state investigation evaluating whether any remedial action is needed to respond to the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by the Borrower or any Subsidiary of the Borrower) or a release or threatened release of any Hazardous Substance into the environment for which the Borrower or any Subsidiary of the Borrower is or may be liable the results of which could, in either case, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, or (iv) has received notice that the Borrower or any Subsidiary of the Borrower is or may be liable to any Person under any Environmental Law which liability could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. (d) To the best of the Borrower's knowledge, no Real Property is located in an area identified by the Secretary of Housing and Urban Development as an area having special flood hazards, or if any such Real Property is located in such a special flood hazard area, then the Borrower has obtained all insurance that is required to be maintained by law or which is customarily maintained by Persons engaged in similar businesses and owning similar Properties in the same general areas in which the Borrower operates. 4.17. Labor Relations. Neither the Borrower nor any of its Subsidiaries is a party to any collective bargaining agreement, other than the collective bargaining agreement covering fewer than 10 employees at the Roosevelt Mall Shopping Center in Philadelphia, Pennsylvania, and, to the best knowledge of the Borrower, no petition has been filed or proceedings instituted by any employee or group of employees with any labor relations board seeking recognition of a bargaining representative with respect to the Borrower or such Subsidiary. There are no material controversies pending between the Borrower or any Subsidiary and any of their respective employees, which could reasonably be expected to have a Material Adverse Effect. 4.18. Burdensome Obligations. Neither the Borrower nor any of its Subsidiaries is a party to or bound by any franchise, agreement, deed, lease or other instrument, or subject to any corporate restriction which, in the opinion of the management of the Borrower or such Subsidiary, is so unusual or burdensome, in the context of its business, as in the foreseeable future might adversely affect or impair the revenue or cash flow of the Borrower or such Subsidiary in such a manner as could reasonably be expected to have a Material Adverse Effect, or materially and adversely affect or impair the ability of the Borrower or such Subsidiary to perform its obligations under the Loan Documents. The Borrower does not presently anticipate that future expenditures by the Borrower or any Subsidiary of the Borrower needed to meet the provisions of federal or state statutes, orders, rules or regulations will be so burdensome as to result in a Material Adverse Effect. - 51 - 57 4.19. Solvency. On the Effective Date and immediately following the making of each Loan, and after giving effect to the application of the proceeds of such Loan: (a) the fair value of the assets of the Borrower and its Subsidiaries, taken as a whole, at a fair valuation, will exceed the debts and liabilities, including Contingent Obligations, of the Borrower and its Subsidiaries, taken as a whole; (b) the present fair saleable value of the property of the Borrower and its Subsidiaries, taken as a whole, will be greater than the amount that will be required to pay the probable liability of the debts and other liabilities, subordinated, contingent or otherwise of the Borrower and its Subsidiaries, as such debts and other liabilities become absolute and matured; (c) the Borrower and its Subsidiaries, taken as a whole, will be able to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (d) the Borrower and its Subsidiaries, taken as a whole, will not have unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted hereafter. 4.20. REIT Status. The Borrower (i) has made an election pursuant to Section 856 of the Code to qualify as a REIT, (ii) has satisfied and continues to satisfy all of the requirements under Sections 856-859 of the Code and the regulations and rulings issued thereunder which must be satisfied for the Borrower to maintain its status as a REIT, and (iii) is in compliance in all material respects with all Code sections applicable to REITs generally and the regulations and rulings issued thereunder. 4.21. Rent Roll and List of Unencumbered Assets. A true, correct and complete Rent Roll, dated not earlier than 30 days prior to the date of this Agreement, and a list of all the Unencumbered Assets of the Borrower as of such date is attached hereto as Schedule 4.21. 4.22. Year 2000. The Borrower has completed its assessment of its centralized corporate business and technical information systems as to Year 2000 compliance and functionality and has completed its remediation of such systems as more particularly set forth on Schedule 4.22. In addition, the Company has completed the identification and review of major computer hardware and software suppliers and has verified the Year 2000 preparedness of these suppliers as more particularly set forth on Schedule 4.22. All statements and disclosures on Schedule 4.22 are true and correct in all material respects and fairly present the Year 2000 preparedness of the Borrower. - 52 - 58 4.23. Operation of Business. The Borrower is a self-advised, and self-managed REIT. 4.24. No Misrepresentation. No representation or warranty contained herein and no certificate or report furnished or to be furnished by the Borrower or any Subsidiary of the Borrower in connection with the transactions contemplated hereby, contains or will contain a misstatement of material fact, or, to the best knowledge of the Borrower, omits or will omit to state a material fact required to be stated in order to make the statements herein or therein contained not misleading in the light of the circumstances under which made. 5. CONDITIONS TO FIRST LOANS In addition to the conditions precedent set forth in Section 6, the obligation of each Lender to make its first Loan shall be subject to the fulfillment of the following conditions precedent: 5.1. Evidence of Action. (a) The Administrative Agent shall have received a certificate, dated the first Borrowing Date, of the Secretary or Assistant Secretary of the Borrower substantially in the form of Exhibit I (i) attaching a true and complete copy of the resolutions of its Board of Directors authorizing the execution and delivery of the Loan Documents by the Borrower and the performance of the Borrower's obligations thereunder, and of all other documents evidencing other necessary action (in form and substance reasonably satisfactory to the Administrative Agent) taken by it to authorize the Loan Documents and the transactions contemplated thereby, (ii) attaching a true and complete copy of its articles of incorporation and by-laws, (iii) setting forth the incumbency of its officer or officers who may sign the Loan Documents, including therein a signature specimen of such officer or officers, and (iv) certifying that said corporate charter and by-laws are true and complete copies thereof, are in full force and effect and have not been amended or modified. (b) The Administrative Agent shall have received a certificate, dated the first Borrowing Date, of the Secretary or Assistant Secretary of each Subsidiary Guarantor substantially in the form of Exhibit J (i) attaching a true and complete copy of the resolutions of its Board of Directors or Trustees, as the case may be, authorizing its execution and delivery of the Guaranty and the performance of its obligations thereunder, and of all other documents evidencing other necessary action (in form and substance reasonably satisfactory to the Administrative Agent) taken by it to authorize the Guaranty and the transactions contemplated thereby, (ii) attaching a true and complete copy of its - 53 - 59 articles of incorporation or corporate charter or declaration of trust and, if applicable, by-laws, (iii) setting forth the incumbency of its officer or officers who may sign the Guaranty, including therein a signature specimen of such officer or officers, and (iv) certifying that said articles of incorporation, corporate charter or declaration of trust and, if applicable, by-laws, are true and complete copies thereof, is in full force and effect and has not been amended or modified. (c) The Administrative Agent shall have received certificates of good standing for the Borrower from the Maryland State Department of Assessments and Taxation and for each Subsidiary Guarantor from the Secretary of State for the State in which such Subsidiary Guarantor is incorporated, and for the Borrower from each jurisdiction other than Maryland in which the Borrower is qualified to do business, provided that such Secretaries issue such certificates with respect to the Borrower. 5.2. This Agreement. The Administrative Agent shall have received counterparts of this Agreement signed by each of the parties hereto (or receipt by the Administrative Agent from a party hereto of a facsimile signature page signed by such party which shall have agreed to promptly provide the Administrative Agent with originally executed counterparts hereof). 5.3. Notes. The Administrative Agent shall have received the Notes, duly executed by an Authorized Signatory of the Borrower. 5.4. Guaranty. The Administrative Agent shall have received counterparts of the Guaranty signed by each of the Subsidiary Guarantors (or receipt by the Administrative Agent from a party hereto of a facsimile signature page signed by such party which shall have agreed to promptly provide the Administrative Agent with originally executed counterparts hereof). 5.5. Other Credit Agreement. The Administrative Agent shall have received counterparts of the Other Credit Agreement signed by each of the parties thereto (or receipt by the Administrative Agent from a party thereto of a facsimile signature page signed by such party which shall have agreed to promptly provide the Administrative Agent with originally executed counterparts hereof), and the Borrower shall have complied with all other conditions of Article 5 of the Other Credit Agreement which are conditions precedent to the first loan thereunder. - 54 - 60 5.6. Litigation. There shall be no injunction, writ, preliminary restraining order or other order of any nature issued by any Governmental Authority in any respect affecting the transactions provided for herein and no action or proceeding by or before any Governmental Authority shall have been commenced and be pending or, to the knowledge of the Borrower, threatened, seeking to prevent or delay the transactions contemplated by the Loan Documents or challenging any other terms and provisions hereof or thereof or seeking any damages in connection therewith and the Administrative Agent shall have received a certificate of an Authorized Signatory of the Borrower to the foregoing effects. 5.7. Opinion of Counsel to the Borrower. The Administrative Agent shall have received an opinion of (i) Hogan & Hartson, L.L.P., outside counsel to the Borrower, and (ii) Steven F. Siegel, Esq., in-house counsel to the Borrower, and (iii) counsel to each Subsidiary Guarantor, each addressed to the Administrative Agent and the Lenders, and each dated the first Borrowing Date, covering the matters set forth in Exhibit K. 5.8. Fees. The Facility Fee, to the extent then due and payable, and all fees payable to the Administrative Agent, the Lead Arranger, the Co-Documentation Agents and the Lenders shall have been paid. 5.9. Fees and Expenses of Special Counsel. The fees and expenses of Special Counsel in connection with the preparation, negotiation and closing of the Loan Documents shall have been paid. 5.10. Year 2000 Assurances. On the Effective Date, the Administrative Agent shall have received such documentation and information from the Borrower and its Subsidiaries as may be reasonably satisfactory to the Administrative Agent demonstrating that the representations of the Borrower in Section 4.22 are true and correct as of the Effective Date. - 55 - 61 6. CONDITIONS OF LENDING - ALL LOANS The obligation of each Lender to make any Revolving Credit Loan or convert its Revolving Credit Loans to Term Loans is subject to the satisfaction of the following conditions precedent as of the date of such Loan: 6.1. Compliance. On each Borrowing Date and after giving effect to the Loans to be made or created, and after any conversion of the Revolving Credit Loans to Term Loans, (a) the Borrower shall be in compliance with all of the terms, covenants and conditions hereof, (b) there shall not exist and be continuing any Default or Event of Default, (c) the representations and warranties contained in the Loan Documents shall be true and correct with the same effect as though such representations and warranties had been made on such Borrowing Date (except for representations and warranties that speak as of a specific date, which need only be true and correct as of such date), and (d) the aggregate outstanding principal balance of the Revolving Credit Loans shall not exceed the Total Commitment Amount. Each notice requesting a Revolving Credit Loan, a Competitive Bid Borrowing or the conversion of Revolving Credit Loans to Term Loans shall be deemed to constitute a representation and warranty by the Borrower on the date thereof that each of the foregoing matters is true and correct in all respects. 6.2. Loan Closings. All documents required by the provisions of the Loan Documents to be executed or delivered to the Administrative Agent on or before the applicable Borrowing Date shall have been executed and shall have been delivered at the office of the Administrative Agent set forth in Section 11.2 on or before such Borrowing Date. 6.3. Borrowing Request; Term Loan Conversion Notice. With respect to each borrowing of a Revolving Credit Loan, the Administrative Agent shall have received a Conventional Borrowing Request or a Competitive Bid Borrowing Request, as the case may be, duly executed by an Authorized Signatory of the Borrower. With respect to the conversion of Revolving Credit Loans to Term Loans, the Administrative Agent shall have timely received a Term Loan Conversion Notice from the Borrower. 6.4. Documentation and Proceedings. All corporate matters and legal proceedings and all documents and papers in connection with the transactions contemplated by the Loan Documents shall be reasonably satisfactory in form and substance to the Administrative Agent and the Administrative Agent shall have received all information and copies of all documents - 56 - 62 which the Administrative Agent or the Required Lenders may reasonably have requested in connection therewith, such documents (where appropriate) to be certified by an Authorized Signatory of the Borrower or proper Governmental Authorities. 6.5. Required Acts and Conditions. All acts, conditions and things (including, without limitation, the obtaining of any necessary regulatory approvals and the making of any filings, recordings or registrations) required to be done or performed by the Borrower and to have happened on or prior to such Borrowing Date and which are necessary for the continued effectiveness of the Loan Documents, shall have been done or performed and shall have happened in due compliance with all applicable laws. 6.6. Approval of Special Counsel. All legal matters in connection with the making of each Loan shall be reasonably satisfactory to Special Counsel. 6.7. Supplemental Opinions. If reasonably requested by the Administrative Agent with respect to the applicable Borrowing Date, there shall have been delivered to the Administrative Agent favorable supplementary opinions of counsel to the Borrower, addressed to the Administrative Agent and the Lenders and dated such Borrowing Date, covering such matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request. 6.8. Other Documents. The Administrative Agent shall have received such other documents and information with respect to the Borrower and its Subsidiaries or the transactions contemplated hereby as the Administrative Agent or the Lenders shall reasonably request. 7. AFFIRMATIVE COVENANTS The Borrower agrees that, so long as any Loan remains outstanding and unpaid, any other amount is owing under any Loan Document to any Lender or the Administrative Agent, or any Lender shall have any obligation to make or maintain any Loan, the Borrower shall: - 57 - 63 7.1. Financial Statements. Maintain a standard system of accounting in accordance with GAAP, and furnish or cause to be furnished to the Administrative Agent and each Lender: (a) Annual Statements. As soon as available, but in any event within 120 days after the end of each fiscal year of the Borrower, a copy of its Consolidated Balance Sheet as at the end of such fiscal year, together with the related Consolidated Statements of Income, Stockholders' Equity and Cash Flows as of and through the end of such fiscal year, setting forth in each case in comparative form the figures for the preceding fiscal year. The Consolidated Balance Sheets and Consolidated Statements of Income, Stockholders' Equity and Cash Flows shall be audited and certified without qualification by the Accountants, which certification shall (i) state that the examination by such Accountants in connection with such Consolidated financial statements has been made in accordance with generally accepted auditing standards and, accordingly, includes the examination, on a test basis, of evidence supporting the amounts and disclosures in such Consolidated financial statements, and (ii) include the opinion of such Accountants that such Consolidated financial statements present fairly, in all material respects, the Consolidated financial position of the Borrower and its Subsidiaries, as of the date of such Consolidated financial statements, and the Consolidated results of their operations and their cash flows for each of the years identified therein in conformity with GAAP (subject to any change in the requirements of GAAP). (b) Annual Operating Statements and Rent Roll. As soon as available, but in any event within 60 days after the end of each fiscal year of the Borrower, copies of (i) the operating statements (in a form reasonably satisfactory to the Administrative Agent) for all Real Property of the Borrower, and (ii) a Rent Roll, each of which shall be certified by the Chief Financial Officer to be true, correct and complete in all material respects. (c) Quarterly Statements. As soon as available, but in any event within 60 days after the end of the first three fiscal quarters of the Borrower, a copy of the unaudited Consolidated Balance Sheet of the Borrower as at the end of each such quarterly period, together with the related unaudited Consolidated Statements of Income and Cash Flows for the elapsed portion of the fiscal year through the end of such period, setting forth in each case in comparative form the figures for the corresponding periods of the preceding fiscal year, certified by the Chief Financial Officer as being true, correct and complete in all material respects and as presenting fairly the Consolidated financial condition and the Consolidated results of operations of the Borrower and its Subsidiaries. (d) Quarterly Information Regarding Unencumbered Assets. As soon as available, but in any event 60 days after the end of each of the first three fiscal quarters of the Borrower (120 days after the end of the last fiscal quarter of the - 58 - 64 Borrower), a list of all the Unencumbered Assets owned by the Borrower, any wholly owned Subsidiary of the Borrower and each DownREIT Partnership as of the last day of such fiscal quarter setting forth the following information with respect to each such Unencumbered Asset as of such date: (i) asset type (i.e., retail shopping center or residential apartment building); (ii) location; (iii) percentage of the Unencumbered Asset owned by the Borrower, any wholly owned Subsidiary of the Borrower and each DownREIT Partnership; and (iv) the Net Operating Income for such Unencumbered Asset during such fiscal quarter. (e) Compliance Certificate. Within 60 days after the end of each of the first three fiscal quarters of the Borrower (120 days after the end of the last fiscal quarter of the Borrower), a Compliance Certificate, certified by the Chief Financial Officer, setting forth in reasonable detail the computations demonstrating the Borrower's compliance with the provisions of Sections 8.12, 8.13, 8.14, 8.15, 8.16 and 8.17. (f) Other Information. Such other information as the Administrative Agent or any Lender may reasonably request from time to time. 7.2. Certificates; Other Information. Furnish to the Administrative Agent and each Lender: (a) Defaults Under Other Indebtedness. Prompt written notice if: (i) any Indebtedness of the Borrower or any Subsidiary of the Borrower is declared or shall become due and payable prior to its stated maturity, or called and not paid when due, or (ii) a default that extends beyond any applicable notice or grace period shall have occurred under any note (other than the Notes) or the holder of any such note, or other evidence of Indebtedness, certificate or security evidencing any such Indebtedness or any obligee with respect to any other Indebtedness of the Borrower or any Subsidiary of the Borrower has the right to declare any such Indebtedness due and payable prior to its stated maturity, and, in the case of either (i) or (ii), the Indebtedness that is the subject of (i) or (ii) is, in the aggregate, $7,500,000 or more; (b) Action of Governmental Authorities. Prompt written notice of: (i) any citation, summons, subpoena, order to show cause or other document naming the Borrower or any Subsidiary of the Borrower a party to any proceeding before any Governmental Authority which could reasonably be expected to have a Material Adverse Effect or which calls into question the validity or enforceability of any of the Loan Documents, and include with such notice a copy of such citation, summons, subpoena, order to show cause or other document; (ii) any lapse or other termination of any Intellectual Property, license, permit, franchise or other authorization issued to the Borrower or any Subsidiary of the Borrower by any Person or Governmental Authority, which lapse or termination could reasonably be expected to have a Material Adverse - 59 - 65 Effect; and (iii) any refusal by any Person or Governmental Authority to renew or extend any such material Intellectual Property, license, permit, franchise or other authorization, which refusal could reasonably be expected to have a Material Adverse Effect; (c) SEC or other Governmental Reports and Filings. Promptly upon becoming available, copies of all regular, periodic or special reports which the Borrower or any Subsidiary of the Borrower may now or hereafter be required to file with or deliver to any securities exchange or the Securities and Exchange Commission, or any other Governmental Authority succeeding to the functions thereof, pursuant to the Securities Exchange Act of 1934, as amended. (d) ERISA Information. Promptly, and in any event within ten Business Days, after the Borrower knows or has reason to know that any of the events or conditions enumerated below with respect to any Plan or Multiemployer Plan has occurred or exists, a statement signed by the Chief Financial Officer setting forth details with respect to such event or condition and the action, if any, which the Borrower or an ERISA Affiliate proposes to take with respect thereto; provided, however, that if such event or condition is required to be reported or noticed to the PBGC, such statement, together with a copy of the relevant report or notice to the PBGC, shall be furnished promptly and in any event not later than ten days after it is reported or noticed to the PBGC: (i) any reportable event, as defined in Section 4043(b) of ERISA with respect to a Plan, as to which the PBGC has not by regulation waived the requirement of Section 4043(a) of ERISA that it be notified within thirty days of the occurrence of such event (provided that a failure to meet the minimum funding standard of Section 412 of the Code or of Section 302 of ERISA, including, without limitation, the failure to make, on or before its due date, a required installment under Section 412(m) of the Code or Section 302(e) of ERISA or the disqualification of such Plan for purposes of Section 4043(b)(1) of ERISA, shall be a reportable event regardless of the issuance of any waivers in accordance with Section 412(d) of the Code) and any request for a waiver under Section 412(d) of the Code for any Plan; (ii) the distribution under Section 4041 of ERISA of a notice of intent to terminate any Plan or any action taken by the Borrower or any ERISA Affiliate to terminate any Plan; (iii) the institution by the PBGC of proceedings under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by the Borrower or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan; - 60 - 66 (iv) the complete or partial withdrawal from a Multiemployer Plan by the Borrower or any ERISA Affiliate that results in liability under Section 4201 or 4204 of ERISA (including the obligation to satisfy secondary liability as a result of a purchaser default) or the receipt of the Borrower or any ERISA Affiliate of notice from a Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends to terminate or has terminated under Section 4041A of ERISA; (v) the institution of a proceeding by a fiduciary of any Multiemployer Plan against the Borrower or any ERISA Affiliate to enforce Section 515 of ERISA, which proceeding is not dismissed within thirty days from its commencement; (vi) the adoption of an amendment to any Plan pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA that would result in the loss of the tax-exempt status of the trust of which such Plan is a part or the Borrower or any ERISA Affiliate fails to timely provide security to such Plan in accordance with the provisions of said Sections; and (vii) any event or circumstance exists which may reasonably be expected to constitute grounds for the incurrence of material liability by the Borrower or any ERISA Affiliate under Title IV of ERISA or under Sections 412(c)(11) or 412(n) of the Code with respect to any employee benefit plan; (e) ERISA Reports. Promptly after the request of the Administrative Agent or any Lender therefor, copies of each annual report filed pursuant to Section 104 of ERISA with respect to each Plan (including, to the extent required by Section 104 of ERISA, the related financial and actuarial statements and opinions and other supporting statements, certifications, schedules and information referred to in Section 103 of ERISA) and each annual report filed with respect to each Plan under Section 4065 of ERISA; provided, however, that in the case of a Multiemployer Plan, such annual reports shall be furnished only if they are available to the Borrower or any ERISA Affiliate; (f) Notice of Proposed Sales or Transfers. Quarterly, on each date that a Compliance Certificate is to be delivered pursuant to Section 7.1(e), a list of all sales or transfers of any Unencumbered Assets (including any agreements for the sale or transfer of any Unencumbered Asset entered into during such fiscal quarter but not yet consummated); provided that, if during any such fiscal quarter of the Borrower any sale or transfer of an Unencumbered Asset, which combined with all other such sales or transfers of Unencumbered Assets during such fiscal quarter, would exceed $100,000,000 in the aggregate, then the Borrower shall promptly provide such list and a certification of the Chief Financial Officer as to the Borrower's compliance with Sections 8.12 and 8.16; - 61 - 67 (g) Casualties or Condemnations. Prompt written notice of any casualty or condemnation of any Real Property, if such casualty or condemnation could reasonably be expected to have a Material Adverse Effect; (h) Environmental Law Notices. Prompt written notice of any order, notice, claim or proceeding received by, or brought against, the Borrower or any Subsidiary of the Borrower, or with respect to any of the Real Property, under any Environmental Law, which could reasonably be expected to have a Material Adverse Effect; (i) Management Letters and Reports. Promptly after the same are received by the Borrower, copies of all management letters and similar reports provided to the Borrower by the Accountants; (j) New Subsidiaries. Notice of any Subsidiary that, as of the end of any fiscal quarter of the Borrower, satisfies the criteria in Section 7.11 with respect to Required Additional Guarantors, such notice to be delivered to the Administrative Agent concurrently with the delivery of the Compliance Certificate with respect to such quarter; (k) Changes in Name or Fiscal Year. Prompt written notice of (i) any change in the Borrower's name, with copies of all filings with respect to such name change attached thereto, and (ii) any change in its fiscal year from that in effect on the Effective Date. (l) Defaults or Events of Default. Prompt written notice if there shall occur and be continuing a Default or an Event of Default; and (m) Other Information. Such other information as the Administrative Agent or any Lender shall reasonably request from time to time. 7.3. Legal Existence. (a) Borrower's Legal Existence. Maintain its status as a Maryland corporation in good standing in the State of Maryland and in each other jurisdiction in which the failure so to do could reasonably be expected to have a Material Adverse Effect. (b) Legal Existence of Subsidiaries. Cause each Subsidiary of the Borrower to maintain its status as a real estate investment trust, business trust, corporation, limited liability company or partnership, as the case may be, in good standing in its state of formation and in each other jurisdiction in which the failure so to do either (i) would result in the occurrence of a Default, or (ii) could reasonably be expected to have a Material Adverse Effect. - 62 - 68 7.4. Taxes. Pay and discharge when due, and cause each Subsidiary of the Borrower so to do, all Taxes, assessments and governmental charges, license fees and levies upon, or with respect to, the Borrower or such Subsidiary and all Taxes upon the income, profits and Property of the Borrower and its Subsidiaries, which if unpaid, could reasonably be expected to have a Material Adverse Effect, unless and to the extent only that such Taxes, assessments, governmental charges, license fees and levies shall be contested in good faith and by appropriate proceedings diligently conducted by the Borrower or such Subsidiary and such contest has the effect of staying the collection of any Lien from any Property of the Borrower or its Subsidiaries arising from such non-payment, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. 7.5. Insurance. Maintain, and cause each Subsidiary of the Borrower to maintain, insurance on its Property against such risks and in such amounts as is customarily maintained by Persons engaged in similar businesses and owning similar Properties in the same general areas in which the Borrower or the relevant Subsidiary operates, and file with the Administrative Agent within 10 Business Days after request therefor a detailed list of such insurance then in effect, stating the names of the carriers thereof, the policy numbers, the insureds thereunder, the amounts of insurance, dates of expiration thereof, and the Property and risks covered thereby, together with a certificate of the Chief Financial Officer certifying that in the opinion of such officer such insurance complies with the obligations of the Borrower under this Section, and is in full force and effect. 7.6. Payment of Indebtedness and Performance of Obligations. Pay and discharge when due, and cause each Subsidiary of the Borrower to pay and discharge, all lawful Indebtedness, obligations and claims for labor, materials and supplies or otherwise which, if unpaid, (i) would result in a Default, or (ii) could reasonably be expected to have a Material Adverse Effect, unless (with respect to clause (ii)) such Indebtedness shall be contested in good faith and by appropriate proceedings diligently conducted by the Borrower or such Subsidiary and such contest has the effect of staying the collection of any Lien from any Property of the Borrower or its Subsidiaries arising from such non-payment, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. - 63 - 69 7.7. Maintenance of Property; Environmental Investigations (a) In all material respects, at all times, maintain, protect and keep in good repair, working order and condition (ordinary wear and tear excepted), and cause each Subsidiary of the Borrower so to do, all Property necessary to the operation of the Borrower's or such Subsidiary's business. (b) In the event that the Administrative Agent shall have a reasonable basis for believing that Hazardous Substances may be on, at, under or around any Real Property in violation of any applicable Environmental Law which, individually or in the aggregate could reasonably be expected to have a Material Adverse Effect, promptly conduct and complete (at the Borrower's expense) all investigations, studies, samplings and testings relative to such Hazardous Substances as the Administrative Agent may reasonably request. 7.8. Observance of Legal Requirements. (a) Observe and comply in all respects, and cause each Subsidiary of the Borrower so to do, with all laws, ordinances, orders, judgments, rules, regulations, certifications, franchises, permits, licenses, directions and requirements of all Governmental Authorities, which now or at any time hereafter may be applicable to it, except (i) where noncompliance with any of the foregoing (individually or in the aggregate) could not reasonably be expected to have a Material Adverse Effect, or (ii) such thereof as shall be contested in good faith and by appropriate proceedings diligently conducted by it and such contest has the effect of staying the collection of any Lien from any Property of the Borrower or its Subsidiaries arising from such noncompliance, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. (b) Use and operate all of its facilities and property in compliance with all Environmental Laws and cause each of its Subsidiaries so to do, and keep all necessary permits, approvals, certificates, licenses and other authorizations relating to environmental matters in effect and remain in compliance therewith and cause each of its Subsidiaries so to do, and handle all Hazardous Materials in compliance with all applicable Environmental Laws and cause each of its Subsidiaries so to do, except where noncompliance with any of the foregoing (individually or in the aggregate) could not reasonably be expected to have a Material Adverse Effect. - 64 - 70 7.9. Inspection of Property; Books and Records; Discussions. Keep proper books of record and account in which full, true and correct entries in conformity with GAAP and all requirements of law shall be made of all dealings and transactions in relation to its business and activities and permit representatives of the Administrative Agent and any Lender during normal business hours and on reasonable prior notice to visit its offices, to inspect any of its Property and to examine and make copies or abstracts from any of its books and records as often as may reasonably be desired, and to discuss the business, operations, prospects, licenses, Property and financial condition of the Borrower or and its Subsidiaries with the officers thereof and the Accountants. 7.10. Licenses, Intellectual Property. Maintain, and cause each Subsidiary of the Borrower to maintain, in full force and effect, all material licenses, franchises, Intellectual Property, permits, authorizations and other rights as are necessary for the conduct of its business. 7.11. Required Additional Guarantors. At any time after the date hereof, and with respect to any Subsidiary of the Borrower, whether presently existing or hereafter formed or acquired (other than Excel Realty Partners, L.P. and E. H. Properties, L.P.) which is not a Subsidiary Guarantor at such time, cause such Subsidiary to execute and deliver a Guaranty to the Administrative Agent, for the benefit of the Lenders, promptly after the Administrative Agent's request therefor, duly executed by such Subsidiary (together with the certificates and attachments described in Section 5.1(b) and (c) with respect to such Subsidiary and an opinion of counsel in the form required pursuant to Section 5.7(iii)) if at such time such Subsidiary owns Property having a book value of $75,000,000 or more. Notwithstanding the foregoing, the foregoing book value conditions of this Section shall not be applicable from and after the occurrence of, and during the continuance of, an Event of Default (it being understood that at such time, the Administrative Agent can require any Subsidiary of the Borrower which has not executed a Guaranty to immediately comply with requirements of this Section). 7.12. REIT Status; Operation of Business (a) Maintain its status under Sections 856 et seq. of the Code as a REIT. (b) Carry on all business operations of the Borrower as a self-advised, self-managed REIT. (c) Manage, or cause one or more of its Subsidiaries at all times to manage, at least 90% of all Properties of the Borrower and its Subsidiaries. - 65 - 71 7.13. Termination of Existing Credit Agreements. On the Effective Date, the Borrower shall qualify for, and shall request, a Loan for the purpose of paying all loans outstanding under the Existing Credit Agreements, together with all interest, fees, breakage costs and other amounts outstanding thereunder, and shall terminate any commitment, or right to borrow, under the Existing Credit Agreements. 8. NEGATIVE COVENANTS The Borrower agrees that, so long as any Loan remains outstanding and unpaid, any other amount is owing under any Loan Document to any Lender or the Administrative Agent, or any Lender shall have any obligation to make or maintain any Loan, the Borrower shall not, directly or indirectly: 8.1. Liens. Create, incur, assume or suffer to exist any Lien upon any of its Property, whether now owned or hereafter acquired, or permit any Subsidiary of the Borrower so to do, except (i) Liens for Taxes, assessments or similar charges incurred in the ordinary course of business which are not delinquent or the existence of which do not otherwise violate the representations in Section 7.4, (ii) Liens in connection with workers' compensation, unemployment insurance or other social security obligations (but not ERISA), (iii) deposits or pledges to secure bids, tenders, contracts (other than contracts for the payment of money), leases, statutory obligations, surety and appeal bonds and other obligations of like nature arising in the ordinary course of business, (iv) zoning ordinances, easements, rights of way, use restrictions, exclusive use limitations in any lease of Real Property, reciprocal easement agreements, minor defects, irregularities, and other similar restrictions and encumbrances affecting Real Property, which do not materially adversely affect the value of such Real Property or the financial condition of the Borrower or such Subsidiary of the Borrower or materially impair its use for the operation of the business of the Borrower or such Subsidiary, (v) statutory Liens arising by operation of law such as mechanics', materialmen's, carriers', warehousemen's liens incurred in the ordinary course of business which are not delinquent or the existence of which do not otherwise violate the representations in Section 7.6, (vi) Liens arising out of judgments or decrees which are being contested in accordance with Section 7.8 or the existence of which do not otherwise violate the representations in Section 7.8 or result in a default pursuant to Section 9.1(j), (vii) mortgages on Real Property, provided that the existence of such mortgages, and the indebtedness secured thereby, does not cause the Borrower to be in violation of Section 8.12 or 8.16, (viii) Liens in favor of the Borrower or any Subsidiary Guarantor, provided that the Indebtedness secured by any such Lien is held by the Borrower or such Subsidiary Guarantor, (ix) the interests of lessees and - 66 - 72 lessors under leases of real or personal property made in the ordinary course of business which could not reasonably be expected (individually or in the aggregate) to have a Material Adverse Effect and (x) Liens not otherwise permitted by clauses (i) through (ix) of this Section which do not in the aggregate exceed $5,000,000. 8.2. Merger, Consolidation and Certain Dispositions of Property. (a) Consolidate with, be acquired by, or merge into or with any Person, or sell, lease or otherwise dispose of all or substantially all of its Property (in one transaction or a series of transactions), or permit any Subsidiary Guarantor of the Borrower so to do, or liquidate or dissolve, except (i) the merger or consolidation of any Subsidiary Guarantor of the Borrower into or with the Borrower, (ii) the merger or consolidation of any two or more Subsidiary Guarantors, or (iii) the merger or consolidation of the Borrower or Subsidiary Guarantor with any other Person, provided that (A) the Borrower or such Subsidiary Guarantor is the surviving entity in such merger or consolidation, (B) the total book value of the assets of the entity which is merged into or consolidated with the Borrower or such Subsidiary Guarantor is less than 20% of the total book value of the assets of the Borrower immediately following such merger or consolidation, (C) immediately prior to such merger or consolidation the Borrower shall have provided to the Administrative Agent and each of the Lenders a Compliance Certificate prepared on a pro-forma basis (and adjusted in the best good faith estimate of the Borrower, based on the advice of the Accountants, to give effect to such merger or consolidation) demonstrating that after giving effect to such merger or consolidation, no Default shall exist with respect to any of the covenants set forth in Sections 8.12, 8.13, 8.14, 8.15, 8.16 and 8.17 and (D) after giving effect to such merger or consolidation, no Event of Default shall exist. (b) Sell, transfer, master lease or dispose of any of its Property, either directly or indirectly, except that if at the time thereof and immediately after giving effect thereto, no Default shall have occurred, (i) any Subsidiary of the Borrower may sell, transfer, master lease or otherwise dispose of its assets to the Borrower or to any other Subsidiary, and (ii) the Borrower or any Subsidiary of the Borrower may sell Property in an arm's length transaction (or, if the transaction involves an Affiliate of the Borrower or a Subsidiary of the Borrower, if the transaction complies with Section 8.8) for the fair market value thereof, as reasonably determined by the Borrower, provided that such sale could not reasonably be expected to have a Material Adverse Effect and provided further that for any fiscal year of the Borrower, any sale, transfer, master lease or disposition of Property in reliance on this clause (ii) which when combined with all other such sales, transfers, master leases or dispositions made in such fiscal year shall not exceed 25% of the total book value of all Property of the Borrower and its Subsidiaries determined as of the first day of such fiscal year. - 67 - 73 8.3. Investments, Loans, Etc. At any time, purchase or otherwise acquire, hold or invest in the Stock of, or any other interest in, any Person, or make any loan or advance to, or enter into any arrangement for the purpose of providing funds or credit to, or make any other investment, whether by way of capital contribution, time deposit or otherwise, in or with any Person, or permit any Subsidiary of the Borrower so to do, (all of which are sometimes referred to herein as "Investments") except the following (to the extent that maintaining any thereof would not at any time violate the requirements of Section 856(c) of the Code): (a) demand deposits, certificates of deposit, bankers acceptances and domestic and eurodollar time deposits with any Lender, or any other commercial bank, trust company or national banking association incorporated under the laws of the United States or any State thereof and having undivided capital, surplus and undivided profits exceeding $500,000,000 and a long term debt rating of A or A2, as determined, respectively, by S&P and Moody's; (b) short-term direct obligations of the United States of America or agencies thereof whose obligations are guaranteed by the United States of America; (c) securities commonly known as "commercial paper" issued by a corporation organized and existing under the laws of the United States or any State thereof which at the time of purchase are rated by S&P or Moody's at not less than "A1" or "P1," respectively; (d) mortgage-backed securities guaranteed by the Governmental National Mortgage Association, the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation and other mortgage-backed bonds which at the time of purchase are rated by S&P or Moody's at not less than "Aa" or "AA," respectively; (e) repurchase agreements having a term not greater than 90 days and fully secured by securities described in the foregoing paragraph (b) or (d) with banks described in the foregoing paragraph (a) or with financial institutions or other corporations having total assets in excess of $50,000,000; (f) shares of "money market funds" registered with the SEC under the Investment Company Act of 1940 which maintain a level per-share value, invest principally in the investments described in one or more of the foregoing paragraphs (a) through (e) and have total assets of in excess of $50,000,000; (g) Real Property and loans secured by mortgages on Real Property; - 68 - 74 (h) equity investments in any Person (other than Subsidiaries) and notes receivable investments in any Person (other than Subsidiaries), the aggregate principal amount of which (combined with any other equity investments and notes receivable investments in any Person permitted pursuant to this paragraph (h)) do not exceed 25% of the Total Capital of the Borrower; (i) Investments (debt or equity) in Subsidiaries of the Borrower; (j) investments in respect of (1) equipment, inventory and other tangible personal property acquired in the ordinary course of business, (2) current trade and customer accounts receivable for services rendered in the ordinary course of business, (3) advances to employees for travel expenses other company-related expenses, and (4) prepaid expenses made in the ordinary course of business; (k) Hedging Agreements made in connection with any Indebtedness; (l) repurchases of any common or preferred stock or other equity interests (or securities convertible into such interests) in the Borrower or any Subsidiary that have been previously issued by the Borrower or such Subsidiary, which do not exceed, in any calendar year, (1) 10% of the outstanding shares of common or preferred stock or other equity interests in Borrower or such Subsidiary, as applicable, as of the date hereof, plus (2) 10% of any additional shares of common or preferred stock or other equity interests in Borrower or such Subsidiary, as applicable, issued after the date hereof; (m) redemptions of preferred stock of the Borrower in accordance with the terms thereof; (n) redemptions for cash or common Stock of the Borrower of units of limited partner interests or limited liability company interests in a DownREIT Partnership; (o) loans to employees of the Borrower, provided that all such loans in the aggregate do not at any time exceed $15,000,000 in the aggregate; and (p) any other Investments not included in paragraphs (a) through (o) deemed appropriate by the Borrower, provided that in no event shall Investments made in reliance upon the exception set forth in this paragraph (p) exceed $50,000,000 at any one time; 8.4. Business Changes. Change in any material respect the nature of the business of the Borrower or its Subsidiaries as conducted on the Effective Date. - 69 - 75 8.5. Amendments to Organizational Documents. Amend or otherwise modify its corporate charter or by-laws in any way (other than in connection with the issuance or classification of preferred stock of the Borrower) which would adversely affect the interests of the Administrative Agent and the Lenders under any of the Loan Documents, or permit any Subsidiary of the Borrower to amend its organizational documents in a manner which could have the same result. 8.6. Bankruptcy Proceedings. Institute against the Administrative Agent, the Co-Documentation Agents or any Lender, or join any other Person in instituting against the Administrative Agent, the Co-Documentation Agents or any Lender, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding or other proceeding under any federal or state bankruptcy or similar law, for one year and a day after the payment or prepayment in full of the Indebtedness due hereunder. 8.7. Sale and Leaseback. Enter into any arrangement with any Person providing for the leasing by it of Property which has been or is to be sold or transferred by it to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such Property or its rental obligations, or permit any Subsidiary of the Borrower so to do, except for sale and leasing transactions described herein for which the combined selling price of all Property subject to all such transactions does not exceed $50,000,000 in the aggregate. 8.8. Transactions with Affiliates. Become a party to any transaction in an amount that exceeds $60,000 with an Affiliate unless the terms and conditions relating thereto (i) have been approved by a majority of the disinterested directors of the Borrower, (ii) have been approved by a majority of votes cast by the stockholders of the Borrower, or (iii) are fair and reasonable to the Borrower, or permit any Subsidiary of the Borrower so to do. 8.9. Issuance of Additional Capital Stock by Subsidiary Guarantors. Permit any Subsidiary Guarantor to issue any additional Stock or other equity interest of such Subsidiary Guarantor, other than the issuance of partnership or limited liability company units in a DownREIT Partnership which is a Subsidiary Guarantor, provided that such units are issued in consideration of the contribution to the DownREIT Partnership of assets qualifying as "real estate assets" under Section 856(c) of the Code. - 70 - 76 8.10. Hedging Agreements Enter into, or permit any of its Subsidiaries so to do, any Hedging Agreement, other than Hedging Agreements entered into in the ordinary course of business to hedge or mitigate interest rate risks to which the Borrower or any Subsidiary of the Borrower is exposed in the conduct of its business or the management of its liabilities. 8.11. Restricted Payments. (a) Permit the Borrower to make Restricted Payments, except that: (i) except as set forth in clause (ii) below, the Borrower may declare and pay dividends payable with respect to its equity securities in any fiscal quarter of the Borrower if after giving effect to such dividend, such dividend, when added to the amount of all other such dividends paid in the same fiscal quarter and the preceding three (3) fiscal quarters, would not exceed the greater of (A) ninety percent (90%) of its Funds from Operations for the four consecutive fiscal quarters ending prior to the quarter in which such dividend is paid or (B) the minimum amount of such dividends required under the Code to enable the Borrower to continue to maintain its status under the Code as a REIT, as evidenced (in the case of clause (B)) by a certification of Chief Financial Officer containing calculations in reasonable detail satisfactory in form and substance to Administrative Agent; (ii) if an Event of Default under Section 9.1(a) or (b) has occurred and is continuing, the Borrower may declare and pay dividends with respect to its equity securities which shall not exceed the minimum such dividends required under the Code to enable the Borrower to continue to maintain its status under the Code as a REIT, as evidenced by a certification of Chief Financial Officer containing calculations in reasonable detail satisfactory in form and substance to Administrative Agent; (iii) the Borrower may effect Stock repurchases to the extent permitted by Section 8.3(l); (iv) the Borrower may effect "cashless exercises" of options granted under the Borrower's stock option plans; (v) the Borrower may distribute rights or equity securities under any rights plan adopted by the Borrower; and - 71 - 77 (vi) the Borrower may declare and pay dividends (or effect Stock splits or reverse Stock splits) with respect to its equity securities payable solely in additional shares of its equity securities. 8.12. Unencumbered Assets Coverage Ratio. Permit the Unencumbered Assets Coverage Ratio to be less than 2.0:1.0 at any time. 8.13. Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio to be less than 1.75:1.0 at any time. 8.14. Minimum Tangible Net Worth. Permit the Tangible Net Worth of the Borrower and its Subsidiaries on a Consolidated basis at any time to be less than the sum of (i) $1,200,000,000, plus (ii) 80% of the aggregate net proceeds received by the Borrower from and after the Effective Date in connection with the issuance of any capital stock of the Borrower. 8.15. Maximum Total Indebtedness. Permit at any time either (i) all Consolidated Total Indebtedness at such time to be more than 55% of Total Capital at such time, or (ii) the Consolidated Total Indebtedness secured by mortgages on Real Property owned by the Borrower and its Subsidiaries at such time to exceed 40% of Total Capital at such time. 8.16. Liabilities to Assets Ratio. Permit, at any time, the portion of the Consolidated Total Indebtedness consisting of Consolidated unsecured Indebtedness of the Borrower and its Subsidiaries at such time to be more than 50% of Unencumbered Asset Value at such time. 8.17. Maximum Book Value of Ancillary Assets. Permit the book value of the Ancillary Assets at any time to be more than 20% of the book value of all assets of the Borrower and its Subsidiaries on a Consolidated basis at such time. For purposes of this Section 8.17 the book value of any Ancillary Asset not owned 100%, directly or indirectly, by the Borrower or any of its Subsidiaries shall be adjusted by multiplying the same by the Borrower's Interest in such Ancillary Asset during the fiscal quarter of the Borrower ending as of any date of determination of such book value. - 72 - 78 9. DEFAULT 9.1. Events of Default. The following shall each constitute an "Event of Default" hereunder: (a) The failure of the Borrower to pay any installment of principal on any Note on the date when due and payable; or (b) The failure of the Borrower to pay any installment of interest or any other fees, expenses or other charges payable under any Loan Document within five Business Days of the date when due and payable; or (c) The use of the proceeds of any Loan in a manner inconsistent with or in violation of Section 2.15; or (d) The failure of the Borrower to observe or perform any covenant or agreement contained in Section 7.3, 7.12(a), 7.12(b), or 8 (other than Section 8.1, as to which the provisions of paragraph (e) below shall apply); or (e) The failure to observe or perform any other term, covenant, or agreement contained in any Loan Document and such failure shall have continued unremedied for a period of 30 days after notice thereof from the Administrative Agent to the Borrower; or (f) Any representation or warranty of the Borrower (or of any officer of the Borrower on its behalf) made in any Loan Document to which it is a party or in any certificate, report, opinion (other than an opinion of counsel) or other document delivered or to be delivered pursuant thereto, shall prove to have been incorrect or misleading (whether because of misstatement or omission) in any material respect when made; or (g) Any obligation of the Borrower (other than its obligations under the Notes) or any Subsidiary of the Borrower, whether as principal, guarantor, surety or other obligor, for the payment of any Indebtedness shall (i) become or shall be declared to be due and payable prior to the expressed maturity thereof, or (ii) shall not be paid when due or within any grace period for the payment thereof, or (iii) shall be subject, by the holder of the obligation evidencing such Indebtedness, to acceleration (after the expiration of any applicable notice and cure periods) prior to the expressed maturity thereof, and the sum of all such Indebtedness which is the subject of paragraphs (i) - (iii) inclusive exceeds (A) at any time, in the case of Indebtedness other than Non-Recourse Indebtedness, $7,500,000, and (B) in any calendar year, in the case of Non-Recourse Indebtedness, $50,000,000 in the aggregate during such year; or - 73 - 79 (h) The Borrower or any Subsidiary Guarantor of the Borrower shall (i) suspend or discontinue its business, (ii) make an assignment for the benefit of creditors, (iii) generally not be paying its debts as such debts become due, (iv) admit in writing its inability to pay its debts as they become due, (v) file a voluntary petition in bankruptcy, (vi) become insolvent (however such insolvency shall be evidenced), (vii) file any petition or answer seeking for itself any reorganization, arrangement, composition, readjustment of debt, liquidation or dissolution or similar relief under any present or future statute, law or regulation of any jurisdiction, (viii) petition or apply to any tribunal for any receiver, custodian or any trustee for any substantial part of its Property, (ix) be the subject of any such proceeding filed against it which remains undismissed for a period of 60 days, (x) file any answer admitting or not contesting the material allegations of any such petition filed against it or any order, judgment or decree approving such petition in any such proceeding, (xi) seek, approve, consent to, or acquiesce in any such proceeding, or in the appointment of any trustee, receiver, custodian, liquidator, or fiscal agent for it, or any substantial part of its Property, or an order is entered appointing any such trustee, receiver, custodian, liquidator or fiscal agent and such order remains in effect for 60 days, or (xii) take any formal action for the purpose of effecting any of the foregoing; or (i) An order for relief is entered under the United States bankruptcy laws or any other decree or order is entered by a court having jurisdiction (i) adjudging the Borrower or any Subsidiary Guarantor bankrupt or insolvent, (ii) approving as properly filed a petition seeking reorganization, liquidation, arrangement, adjustment or composition of or in respect of the Borrower or any Subsidiary Guarantor under the United States bankruptcy laws or any other applicable Federal or state law, (iii) appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of the Borrower or any Subsidiary Guarantor or of any substantial part of the Property thereof, or (iv) ordering the winding up or liquidation of the affairs of the Borrower or any Subsidiary Guarantor, and any such decree or order continues unstayed and in effect for a period of 60 days; or (j) Judgments or decrees against the Borrower or any Subsidiary of the Borrower aggregating in excess of $5,000,000 shall not be paid, stayed on appeal, discharged, bonded or dismissed for a period of 45 days; or (k) Any Loan Document shall cease, for any reason, to be in full force and effect, or the Borrower shall so assert in writing or shall disavow any of its obligations thereunder; or (l) An event or condition specified in Section 7.2(d) shall occur or exist with respect to any Plan or Multiemployer Plan and, as a result of such event or condition, together with all other such events or conditions, the Borrower shall be reasonably likely to incur a liability to a Plan, a Multiemployer Plan, the PBGC, or any - 74 - 80 combination thereof which would constitute, in the reasonable opinion of the Required Lenders, a Material Adverse Effect; or (m) There shall occur a Change of Control; or (n) If any Loan Document (i) is determined by any court or Governmental Authority to be illegal, invalid or unenforceable in accordance with its terms, or (ii) shall be canceled, terminated, revoked or rescinded other than in accordance with its terms or with the written consent or approval of the Lenders; or (o) (i) Any Subsidiary Guarantor shall fail to comply in any material respect with any covenant made by it in the Guaranty or if at any time any representation or warranty made by any Subsidiary Guarantor in the Guaranty or in any other document, statement or writing made to the Agent, the Co-Documentation Agents, the Lead Arranger or the Lenders shall prove to have been incorrect or misleading in any material respect when made, or (ii) if a default by any Subsidiary Guarantor shall occur under the Guaranty after the expiration of any applicable notice and grace period; or (iii) if any Subsidiary Guarantor shall revoke or attempt to revoke, contest, commence any action or raise any defense (other than the defense of payment) against its obligations under the Guaranty; or (p) There shall occur an Event of Default under and as defined in the Other Credit Agreement. Upon the occurrence of an Event of Default or at any time thereafter during the continuance thereof, (a) if such event is an Event of Default specified in clause (h) or (i) above, the Commitments shall immediately and automatically terminate and the Loans, all accrued and unpaid interest thereon, and all other amounts owing under the Loan Documents shall immediately become due and payable, and the Administrative Agent may, and upon the direction of the Required Lenders shall, exercise any and all remedies and other rights provided in the Loan Documents, and (b) if such event is any other Event of Default, any or all of the following actions may be taken: (i) with the consent of the Required Lenders, the Administrative Agent may, and upon the direction of the Required Lenders shall, by notice to the Borrower, declare the Commitments to be terminated forthwith, whereupon the Commitments shall immediately terminate; and (ii) with the consent of the Required Lenders, the Administrative Agent may, and upon the direction of the Required Lenders shall, by notice of default to the Borrower, declare the Loans, all accrued and unpaid interest thereon and all other amounts owing under the Loan Documents to be due and payable forthwith, whereupon the same shall immediately become due and payable, and the Administrative Agent may, and upon the direction of the Required Lenders shall, exercise any and all remedies and other rights provided pursuant to the Loan Documents. Except as otherwise provided in this Section, presentment, demand, protest and all other - 75 - 81 notices of any kind are hereby expressly waived. The Borrower hereby further expressly waives and covenants not to assert any appraisement, valuation, stay, extension, redemption or similar laws, now or at any time hereafter in force which might delay, prevent or otherwise impede the performance or enforcement of any Loan Document. In the event that the Commitments shall have been terminated or the Notes shall have been declared due and payable pursuant to the provisions of this Section, any funds received by the Administrative Agent and the Lenders from or on behalf of the Borrower shall be applied by the Administrative Agent and the Lenders in liquidation of the Loans and the obligations of the Borrower under the Loan Documents in the following manner and order: (i) first, to the payment of interest on and then the principal portion of any Loans which the Administrative Agent may have advanced on behalf of any Lender for which the Administrative Agent has not then been reimbursed by such Lender or the Borrower; (ii) second, to the payment of any fees or expenses due the Administrative Agent from the Borrower; (iii) third, to reimburse the Administrative Agent and the Lenders for any expenses (to the extent not paid pursuant to clause (ii)) due from the Borrower pursuant to the provisions of Section 11.5; (iv) fourth, to the payment of accrued Facility Fees, and all other fees, expenses and amounts due under the Loan Documents (other than principal and interest on the Notes); (v) fifth, to the payment of interest due on the Notes; (vi) sixth, to the payment of principal outstanding on the Notes; and (vii) seventh, to the payment of any other amounts owing to the Administrative Agent, the Co-Documentation Agents, the Lead Arranger and the Lenders under any Loan Document or other document or agreement entered into in connection with the transactions contemplated thereby. 10. THE AGENT 10.1. Appointment. Each Lender hereby irrevocably designates and appoints BNY as the Administrative Agent of such Lender under the Loan Documents and each such Lender hereby irrevocably authorizes BNY, as the Administrative Agent for such Lender, to take such action on its behalf under the provisions of the Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of the Loan Documents, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in any Loan Document, the Administrative Agent shall not have any duties or responsibilities, except those expressly set forth therein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into the Loan Documents or otherwise exist against the Administrative Agent. - 76 - 82 10.2. Delegation of Duties. The Administrative Agent may execute any of its duties under the Loan Documents by or through agents or attorneys-in-fact and shall be entitled to rely upon the advice of counsel concerning all matters pertaining to such duties. 10.3. Exculpatory Provisions. Neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with the Loan Documents (except for its own gross negligence or willful misconduct), or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower or any officer thereof contained in the Loan Documents or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, the Loan Documents or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of any of the Loan Documents or for any failure of the Borrower or any other Person to perform its obligations thereunder. The Administrative Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, the Loan Documents, or to inspect the properties, books or records of the Borrower. The Administrative Agent shall not be under any liability or responsibility whatsoever, as Administrative Agent, to the Borrower or any other Person as a consequence of any failure or delay in performance, or any breach, by any Lender of any of its obligations under any of the Loan Documents. 10.4. Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, opinion, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation reasonably believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Borrower), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent may treat each Lender, or the Person designated in the last notice filed with it under this Section, as the holder of all of the interests of such Lender in its Loans and in its Note until written notice of transfer, signed by such Lender (or the Person designated in the last notice filed with the Administrative Agent) and by the Person designated in such written notice of transfer, in form and substance satisfactory to the Administrative Agent, shall have been filed with the Administrative Agent. The Administrative Agent shall not be under any duty to examine or pass upon the validity, - 77 - 83 effectiveness or genuineness of the Loan Documents or any instrument, document or communication furnished pursuant thereto or in connection therewith, and the Administrative Agent shall be entitled to assume that the same are valid, effective and genuine, have been signed or sent by the proper parties and are what they purport to be. The Administrative Agent shall be fully justified in failing or refusing to take any action under the Loan Documents unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under the Loan Documents in accordance with a request or direction of the Required Lenders, and such request or direction and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Notes. 10.5. Notice of Default. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default unless the Administrative Agent has received written notice thereof from a Lender or the Borrower. In the event that the Administrative Agent receives such a notice, the Administrative Agent shall promptly give notice thereof to the Lenders. The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders, provided, however, that unless and until the Administrative Agent shall have received such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem to be in the best interests of the Lenders. 10.6. Non-Reliance on Administrative Agent and Other Lenders. Each Lender expressly acknowledges that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereinafter, including any review of the affairs of the Borrower, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Lender. Each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own evaluation of and investigation into the business, operations, Property, financial and other condition and creditworthiness of the Borrower and made its own decision to enter into this Agreement. Each Lender also represents that it will, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, evaluations and decisions in taking or not taking action under any Loan Document, and to make such investigation as it deems necessary to inform itself as to the business, operations, Property, financial and other condition and creditworthiness of the - 78 - 84 Borrower. Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, Property, financial and other condition or creditworthiness of the Borrower which may come into the possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or affiliates. 10.7. Indemnification. Each Lender agrees to indemnify and reimburse the Administrative Agent in its capacity as such (to the extent not promptly reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), pro rata according to its Commitment, from and against any and all liabilities, obligations, claims, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever including, without limitation, any amounts paid to the Lenders (through the Administrative Agent) by the Borrower pursuant to the terms of the Loan Documents, that are subsequently rescinded or avoided, or must otherwise be restored or returned) which may at any time (including, without limitation, at any time following the payment of the Notes) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of the Loan Documents or any other documents contemplated by or referred to therein or the transactions contemplated thereby or any action taken or omitted to be taken by the Administrative Agent under or in connection with any of the foregoing; provided, however, that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements to the extent resulting solely from the gross negligence or willful misconduct of the Administrative Agent. The agreements in this Section shall survive the payment of all amounts payable under the Loan Documents. 10.8. Administrative Agent in Its Individual Capacity. BNY and its affiliates may make loans to, accept deposits from, issue letters of credit for the account of, and generally engage in any kind of business with, the Borrower as though BNY was not Administrative Agent hereunder. With respect to the Commitment made or renewed by BNY and the Note issued to BNY, BNY shall have the same rights and powers under the Loan Documents as any Lender and may exercise the same as though it was not the Administrative Agent, and the terms "Lender" and "Lenders" shall in each case include BNY. - 79 - 85 10.9. Successor Administrative Agent. If at any time the Administrative Agent deems it advisable, in its sole discretion, it may submit to each of the Lenders a written notice of its resignation as Administrative Agent under this Agreement, such resignation to be effective upon the earlier of (i) the written acceptance of the duties of the Administrative Agent under the Loan Documents by a successor Administrative Agent and (ii) on the 60th day after the date of such notice. Upon any such notice of resignation, the Required Lenders shall have the right to appoint from among the Lenders a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed by the Required Lenders and accepted such appointment in writing within 45 days after the retiring Administrative Agent's giving of notice of resignation, then the retiring Administrative Agent shall, in consultation with the Borrower, appoint a successor Administrative Agent on behalf of the Lenders prior to the end of the 60th day from such notice from among any of the Lenders who shall have at such time a Commitment of at least $15,000,000 (an "Approved Successor"). If no Lender has a Commitment of at least $15,000,000 (or no Lender whose Commitment is at least $15,000,000 shall agree to accept such appointment), then the retiring Administrative Agent shall, in consultation with the Borrower, appoint any other Lender or any other commercial bank organized under the laws of the United States of America or any State thereof and having a combined capital and surplus of at least $100,000,000 as a successor Administrative Agent. Any appointment of a successor Administrative Agent shall be subject to the approval of the Borrower, which approval shall not be unreasonably withheld or delayed, and shall be given in any event prior to the end of the 60th day from the date of the retiring Administrative Agent's notice of resignation, provided that during any period in which either (i) a Competitive Bid Advance is outstanding, or (ii) there exists and is continuing an Event of Default, no approval from the Borrower to the appointment of an Approved Successor shall be required. Upon the acceptance of an appointment as Administrative Agent hereunder by a successor Administrative Agent and any required approval of such successor Administrative Agent by the Borrower in accordance with the terms of this Section, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent's rights, powers, privileges and duties as Administrative Agent under the Loan Documents shall be terminated. The Borrower and the Lenders shall execute such documents as shall be necessary to effect such appointment. After any retiring Administrative Agent's resignation hereunder as Administrative Agent, the provisions of the Loan Documents shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under the Loan Documents. - 80 - 86 10.10. Exculpation of Co-Documentation Agents. Neither of the Co-Documentation Agents has any rights, obligations, liabilities, responsibilities or duties under the Agreement other than those applicable to all Lenders as such. 11. OTHER PROVISIONS. 11.1. Amendments and Waivers. With the written consent of the Required Lenders, the Administrative Agent and the Borrower may, from time to time, enter into written amendments, supplements or modifications of the Loan Documents and, with the consent of the Required Lenders, the Administrative Agent on behalf of the Lenders may execute and deliver to any such parties a written instrument waiving or a consent to a departure from, on such terms and conditions as the Administrative Agent may specify in such instrument, any of the requirements of the Loan Documents or any Default or Event of Default and its consequences; provided, however, that no such amendment, supplement, modification, waiver or consent shall, without the consent of all of the Lenders: (i) change the Commitments of any Lender or the Total Commitment Amount; (ii) extend the Revolving Credit Termination Date (other than as provided for in Section 2.18); (iii) decrease the rate, or extend the time of payment, of interest of, or change or forgive the principal amount of, or change the requirement that payments and prepayments of principal of, and payments of interest on, the Notes be made pro rata to the Lenders on the basis of the outstanding principal amount of the Loans, (iv) amend the definition of "Required Lender", (v) amend the definitions of "Applicable Facility Fee Percentage" or "Applicable Margin", (vi) release any Subsidiary Guarantor from its obligations under a Guaranty, or (vii) change the provisions of Section 2.9, 2.10, 2.11, 2.12, 2.13, 2.14, 2.15, 2.16, 3.1 or 11.1; and provided further that no such amendment, supplement, modification, waiver or consent shall amend, modify, waive or consent to a departure from any provision of Section 10 or otherwise change any of the rights or obligations of the Administrative Agent under the Loan Documents without the written consent of the Administrative Agent; and provided further that no such amendment, supplement, modification, waiver or consent shall, unless in writing and signed by the Designating Lender on behalf of each Designated Lender affected thereby, (a) subject such Designated Lender to any additional obligations, (b) reduce the principal of, interest on, or other amounts due with respect to, the Competitive Bid Borrowings made payable to such Designated Lender, (c) postpone any date fixed for any payment of principal of, or interest on, or other amounts due with respect to, Competitive Bid Borrowings made payable to such Designated Lender, or (d) amend the definition of Required Lenders hereunder in a manner which adversely affects the rights of such Designated Lender. The Administrative Agent shall cause a copy of each written request for such an - 81 - 87 amendment, supplement or modification delivered by the Borrower to it to be delivered to each Lender. Any such amendment, supplement, modification, waiver or consent shall apply equally to each of the Lenders and shall be binding upon the parties to the applicable agreement, the Lenders, the Administrative Agent and all future holders of the Notes. In the case of any waiver, the parties to the applicable agreement, the Lenders and the Administrative Agent shall be restored to their former position and rights under the Loan Documents, and any Default or Event of Default waived shall not extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon. 11.2. Notices. All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered by hand, or if sent by certified mail (return receipt requested), when the return receipt is signed on behalf of the party to whom such notice is given, or in the case of telecopier notice, when sent, or if sent by overnight nationwide commercial courier, the Business Day following the date such notice is deposited with said courier, and in any case addressed as follows in the case of the Borrower or the Administrative Agent, and at the Domestic Lending Office in the case of each Lender, or to such other addresses as to which the Administrative Agent may be hereafter notified by the respective parties hereto or any future holders of the Notes: The Borrower: New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas New York, New York 10036 Attention: Dean Bernstein, Senior Vice President Telephone: (212) 869-3000 Telecopy: (212) 869-3989 with a copy to: New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas New York, New York 10036 Attention: Steven F. Siegel, Esq., General Counsel Telephone: (212) 869-3000 Telecopy: (212) 302-4776 - 82 - 88 The Administrative Agent: The Bank of New York One Wall Street Agency Function Administration 18th Floor New York, New York 10286 Attention: Sandra Scaglione Agency Function Administrator Telephone: (212) 635-4695 Telecopy: (212) 635-6365 or 6366 or 6367 with a copy to: The Bank of New York One Wall Street New York, New York 10286 Attention: Rick Laudisi Vice President Telephone: (212) 635-7621 Telecopy: (212) 809-9526, except that any notice, request or demand by the Borrower to or upon the Administrative Agent or the Lenders pursuant to Section 2.3, 2.4 or 2.8 shall not be effective until received. Any party to a Loan Document may rely on signatures of the parties thereto which are transmitted by telecopier or other electronic means as fully as if originally signed. 11.3. No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising any right, remedy, power or privilege under any Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under any Loan Document preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges under the Loan Documents are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law. 11.4. Survival of Representations and Warranties. All representations and warranties made under the Loan Documents and in any document, certificate or statement delivered pursuant hereto or in connection therewith shall survive the execution and delivery of the Loan Documents. After the - 83 - 89 termination of this Agreement in accordance with its terms, without any extension thereof, the payment in full of all obligations of the Borrower under the Loan Documents and the expiration of any obligations of the Borrower hereunder which survive the termination of this Agreement, the Borrower shall have no liability to the Lenders under such representations and warranties, except that the foregoing shall not apply with respect to any claim, action or proceeding made or brought under any such representations or warranties prior to such termination or payment. 11.5. Payment of Expenses and Taxes. The Borrower agrees, promptly upon presentation of a statement or invoice therefor, and whether any Loan is made (i) to pay or reimburse each Credit Party for all of its out-of-pocket costs and expenses reasonably incurred in connection with the development, preparation, negotiation and execution of, the Loan Documents, the syndication of the loan transaction evidenced by this Agreement (whether or not such syndication is completed) and any amendment, supplement or modification hereto (whether or not executed), any documents prepared in connection therewith and the consummation of the transactions contemplated thereby, including, without limitation, the reasonable fees and disbursements of Special Counsel, (ii) to pay or reimburse each Credit Party for all of its respective costs and expenses, including, without limitation, reasonable fees and disbursements of counsel, incurred in connection with (x) any Default or Event of Default and any enforcement or collection proceedings resulting therefrom (including, without limitation, any costs incurred after the entry of judgment in an attempt to collect money due in the judgment) or in connection with the negotiation of any restructuring or "work-out" (whether consummated or not) of the obligations of the Borrower under any of the Loan Documents and (y) the enforcement of this Section, (iii) to pay, indemnify, and hold each Credit Party harmless from and against, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, the Loan Documents and any such other documents, and (iv) to pay, indemnify and hold each Credit Party and each of their respective officers, directors, employees, affiliates, agents, controlling persons and attorneys (as used in this Section, each an "indemnified person") harmless from and against any and all other liabilities, obligations, claims, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever (including, without limitation, reasonable counsel fees and disbursements) with respect to any claim, investigation or proceeding from any third party relating to this Agreement or the Loan Documents, including the enforcement and performance of the Loan Documents and the use of the proceeds of the Loans (all the foregoing, collectively, the "indemnified liabilities"), whether or not any such - 84 - 90 indemnified person is a party to this Agreement or the Loan Documents, and to reimburse each indemnified person for all legal and other expenses incurred in connection with investigating or defending any indemnified liabilities, and, if and to the extent that the foregoing indemnity may be unenforceable for any reason, the Borrower agrees to make the maximum payment permitted or not prohibited under applicable law; provided, however, that the Borrower shall have no obligation hereunder to pay indemnified liabilities to any Credit Party arising from (A) the gross negligence or willful misconduct of such Credit Party or (B) disputes solely between the Credit Parties and which are not related to any act or failure to act on the part of the Borrower or the failure of the Borrower to perform any of its obligations under this Agreement or the Loan Documents. Notwithstanding the foregoing, the fees and expenses referred to in clause (iv) of the preceding paragraph shall not be payable by the Borrower if (x) any such enforcement action brought by such Credit Party is dismissed, with prejudice, on the pleadings or pursuant to a motion made by the Borrower for summary judgment, and (y) if such Credit Party appeals such dismissal, such dismissal is affirmed and the time for any further appeals has expired. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 11.6. Lending Offices. Each Lender shall have the right at any time and from time to time to transfer its Loans to a different office, provided that such Lender shall promptly notify the Administrative Agent and the Borrower of any such change of office. Such office shall thereupon become such Lender's Domestic Lending Office or Eurodollar Lending Office, as the case may be; provided, however, that no such Lender shall be entitled to receive any greater amount under Section 2.13, 2.14 or 2.16 as a result of a transfer of any such Loans to a different office of such Lender than it would be entitled to immediately prior thereto unless such claim would have arisen even if such transfer had not occurred. 11.7. Successors and Assigns. (a) The Loan Documents shall be binding upon and inure to the benefit of the Borrower, the Lenders, the Administrative Agent, all future holders of the Notes and their respective successors and assigns, except that the Borrower may not assign, delegate or transfer any of its rights or obligations under the Loan Documents without the prior written consent of the Administrative Agent and all of the Lenders. (b) Each Lender (other than a Designated Lender) shall have the right at any time, upon written notice to the Administrative Agent of its intent to do so, to sell, - 85 - 91 assign, transfer or negotiate all or any part of such Lender's rights and/or obligations under the Loan Documents (subject to paragraph (c) below) to one or more of its Affiliates, to one or more of the other Lenders (or to Affiliates of such other Lenders) or, with the prior written consent of the Borrower, and the Administrative Agent (which consent, from each of them, shall not be unreasonably withheld or delayed and shall not be required from the Borrower upon the occurrence and during the continuance of an Event of Default), to sell, assign, transfer or negotiate all or any part of such Lender's rights and obligations under the Loan Documents to any other bank, insurance company, pension fund, mutual fund or other financial institution, provided that there shall be paid to the Administrative Agent by the assigning Lender a fee (the "Assignment Fee") of $3,500. A Designated Lender shall not assign any of its Loans to any Person at any time, other than an assignment of all or part of such Loans to its Designating Lender. Simultaneously with each assignment by a Lender of all or any part of its and Revolving Credit Loans made as Conventional Advances, such Lender shall assign, pursuant to the terms of the Other Credit Agreement, an equal percentage of its Commitment and Revolving Credit Loans made as Conventional Advances under, and as defined in, the Other Credit Agreement. For each assignment, the parties to such assignment shall execute and deliver to the Administrative Agent for its acceptance and recording an Assignment and Assumption Agreement. Upon such execution, delivery, acceptance and recording by the Administrative Agent, from and after the effective date specified in such Assignment and Assumption Agreement, the assignee thereunder shall be a party hereto and, to the extent provided in such Assignment and Assumption Agreement, the assignor Lender thereunder shall be released from its obligations under the Loan Documents. The Borrower agrees upon written request of the Administrative Agent and at the Borrower's expense to execute and deliver (1) to such assignee, a Note, dated the effective date of such Assignment and Assumption Agreement, in an aggregate principal amount equal to the Loans assigned to, and Commitments assumed by, such assignee and (2) to such assignor Lender, a Note, dated the effective date of such Assignment and Assumption Agreement, in an aggregate principal amount equal to the balance of such assignor Lender's Loans and Commitment, if any, and each assignor Lender shall cancel and return to the Borrower its existing Note. Upon any such sale, assignment or other transfer, the Commitment Amounts set forth in Exhibit B shall be adjusted accordingly by the Administrative Agent and a new Exhibit B shall be distributed by the Administrative Agent to the Borrower and each Lender. (c) Each Lender shall maintain an equal Commitment Percentage in (i) all Revolving Credit Loans made as Conventional Advances and Term Loans hereunder, and (ii) all Revolving Credit Loans made as Conventional Advances and LC Exposure under, and as defined in, the Other Credit Agreement. Accordingly, each sale, assignment, transfer or negotiation by a Lender of all or any part of its rights and/or obligations under the Loan Documents shall include an equal prorata share of its rights - 86 - 92 and/or obligations under Loan Documents under, and as defined in, the Other Credit Agreement. (d) Each Lender may grant participations in all or any part of its Loans, its Note and its Commitment to one or more banks, insurance companies, financial institutions, pension funds or mutual funds, provided that (i) such Lender's obligations under the Loan Documents shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties to the Loan Documents for the performance of such obligations, (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under the Loan Documents, (iv) no sub-participations shall be permitted and (v) the voting rights of any holder of any participation shall be limited to decisions that only do any of the following: (A) subject the participant to any additional obligation, (B) reduce the principal of, or interest on the Notes or any fees or other amounts payable hereunder, and (C) postpone any date fixed for the payment of principal of, or interest on the Notes or any fees or other amounts payable hereunder. The Borrower acknowledges and agrees that any such participant shall for purposes of Sections 2.10, 2.11, 2.12, 2.13, 2.14, 2.15 and 2.16 be deemed to be a "Lender"; provided, however, the Borrower shall not, at any time, be obligated to pay any participant in any interest of any Lender hereunder any sum in excess of the sum which the Borrower would have been obligated to pay to such Lender in respect of such interest had such Lender not sold such participation. (e) If any (i) assignment made pursuant to paragraph (b) above or (ii) any participation granted pursuant to paragraph (d) above shall be made to any Person that is organized under the laws of any jurisdiction other than the United States of America or any State thereof, such Person shall furnish such certificates, documents or other evidence to the Borrower and the Administrative Agent, in the case of clause (i) and to the Borrower and the Lender which sold such participation in the case of clause (ii), as shall be required by Section 2.11(b) to evidence such Person's exemption from U.S. withholding taxes with respect to any payments under or pursuant to the Loan Documents because such Person is eligible for the benefits of a tax treaty which provides for a zero % rate of tax on any payments under the Loan Documents or because any such payments to such Person are effectively connected with the conduct by such Person of a trade or business in the United States. (f) No Lender shall, as between and among the Borrower, the Administrative Agent and such Lender, be relieved of any of its obligations under the Loan Documents as a result of any sale, assignment, transfer or negotiation of, or granting of participations in, all or any part of its Loans, its Commitment or its Note, except that a Lender shall be relieved of its obligations to the extent of any such sale, assignment, transfer, or negotiation of all or any part of its Loans, its Commitment or its Note pursuant to paragraph (b) above. - 87 - 93 (g) Notwithstanding anything to the contrary contained in this Section, any Lender may at any time or from time to time assign all or any portion of its rights under the Loan Documents to a Federal Reserve Bank, provided that any such assignment shall not release such assignor from its obligations thereunder. 11.8. Designated Lender. (a) Each Lender (each a "Designating Lender") may at any time designate one or more Designated Lenders to fund Competitive Bid Advances which the Designating Lender is required to fund subject to the terms of Section 2.4. No Lender shall be entitled to make more than one such designation. The parties to each such designation shall execute and deliver to the Administrative Agent, for its acceptance, a Designation Agreement. Upon its receipt of an appropriately completed Designation Agreement executed by a Designating Lender and a designee representing that it is a Designated Lender, the Administrative Agent will accept such Designation Agreement and give prompt notice thereof to the Borrower, whereupon, from and after the effective date specified in the Designation Agreement, the Designated Lender shall become a party to this Agreement with a right to make Competitive Bid Advances on behalf of its Designating Lender pursuant to Section 2.4 after the Borrower has accepted an offer to make the Competitive Bid Advance (or a portion thereof) from the Designating Lender. Each Designating Lender shall serve as the agent of the Designated Lender and shall on behalf of the Designated Lender give and receive all communications and notices and take all actions hereunder, including without limitation votes, approvals, waivers, consents and amendments under or relating to this Agreement or the other Loan Documents. Any such notice, communication, vote approval, waiver, consent or amendment shall be signed by the Designating Lender as agent for its Designated Lender. The Borrower, the Administrative Agent and the Lenders may rely thereon without any requirement that the Designated Lender sign or acknowledge the same. (b) A Designated Lender shall not make or participate in Revolving Credit Loans made as Conventional Advances or Term Loans of any Designating Lender, nor shall any Designated Lender have a Commitment or share in or be obligated under the Commitment of any Lender, it being understood that each Designated Lender shall be entitled to make only Competitive Bid Advances offered by the Designating Lender of such Designated Lender pursuant to Section 2.4(c), to the extent the offer of such Competitive Bid Advances has been accepted by the Borrower pursuant to Section 2.4(d). 11.9. Counterparts. Each Loan Document (other than the Notes) may be executed by one or more of the parties thereto on any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same document. It - 88 - 94 shall not be necessary in making proof of any Loan Document to produce or account for more than one counterpart signed by the party to be charged. A telecopied counterpart of any Loan Document or to any document evidencing, and of any an amendment, modification, consent or waiver to or of any Loan Document shall be deemed to be an originally executed counterpart. A set of the copies of the Loan Documents signed by all the parties thereto shall be deposited with each of the Borrower and the Administrative Agent. Any party to a Loan Document may rely upon the signatures of any other party thereto which are transmitted by telecopier or other electronic means to the same extent as if originally signed. 11.10. Adjustments; Set-off. (a) If any Lender (a "Benefited Lender") shall at any time receive any payment of all or any part of its Loans or interest thereon, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in Section 9.1(h) or (i), or otherwise) in a greater proportion than any such payment to and collateral received by any other Lender in respect of such other Lender's Loans or interest thereon, such Benefited Lender shall purchase for cash from each of the other Lenders such portion of each such other Lender's Loans and shall provide each of such other Lenders with the benefits of any such collateral, or the proceeds thereof, as shall be necessary to cause such Benefited Lender to share the excess payment or benefits of such collateral or proceeds ratably with each of the Lenders, provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefited Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest. The Borrower agrees that each Lender so purchasing a portion of another Lender's Loans may exercise all rights of payment (including, without limitation, rights of set-off, to the extent not prohibited by law) with respect to such portion as fully as if such Lender were the direct holder of such portion. (b) In addition to any rights and remedies of the Lenders provided by law, upon the occurrence of an Event of Default and the acceleration of the obligations owing in connection with the Loan Documents, or at any time upon the occurrence and during the continuance of an Event of Default under Section 9.1(a) or (b), each Lender shall have the right, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent not prohibited by applicable law, to set-off and apply against any indebtedness, whether matured or unmatured, of the Borrower to such Lender, any amount owing from such Lender to the Borrower, at, or at any time after, the happening of any of the above-mentioned events. To the extent not prohibited by applicable law, the aforesaid right of set-off may be exercised by such Lender against the Borrower or against any trustee in bankruptcy, custodian, debtor in possession, assignee for the benefit of creditors, receiver, or execution, judgment or attachment creditor of the Borrower, or against anyone else claiming through or against the - 89 - 95 Borrower or such trustee in bankruptcy, custodian, debtor in possession, assignee for the benefit of creditors, receivers, or execution, judgment or attachment creditor, notwithstanding the fact that such right of set-off shall not have been exercised by such Lender prior to the making, filing or issuance, or service upon such Lender of, or of notice of, any such petition, assignment for the benefit of creditors, appointment or application for the appointment of a receiver, or issuance of execution, subpoena, order or warrant. Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such set-off and application. 11.11. Lenders' Representations. Each Lender represents to the Administrative Agent that, in acquiring its Note, it is acquiring the same for its own account for the purpose of investment and not with a view to selling the same in connection with any distribution thereof, provided that the disposition of each Lender's own Property shall at all times be and remain within its control. 11.12. Indemnity. The Borrower agrees to indemnify and hold harmless each Credit Party and its affiliates, directors, officers, employees, affiliates, agents, controlling persons and attorneys (each an "Indemnified Person") from and against any loss, cost, liability, damage or expense (including the reasonable fees and disbursements of counsel of such Indemnified Person, including all local counsel hired by any such counsel) incurred by such Indemnified Person in investigating, preparing for, defending against, or providing evidence, producing documents or taking any other action in respect of, any commenced or threatened litigation, administrative proceeding or investigation under any federal securities or tax laws or any other statute of any jurisdiction, or any regulation, or at common law or otherwise, which is alleged to arise out of or is based upon: (i) any untrue statement of any material fact by the Borrower in any document or schedule executed or filed with any Governmental Authority by or on behalf of the Borrower; (ii) any omission to state any material fact required to be stated in such document or schedule, or necessary to make the statements made therein, in light of the circumstances under which made, not misleading; or (iii) any acts, practices or omissions of the Borrower or its agents relating to the use of the proceeds of any or all borrowings made by the Borrower which are alleged to be in violation of Section 2.15, or in violation of any federal securities or tax laws or of any other statute, regulation or other law of any jurisdiction applicable thereto, whether or not such Indemnified Person is a party thereto. The indemnity set forth herein shall be in addition to any other obligations, liabilities or other indemnifications of the Borrower to each Indemnified Person under the Loan Documents or at common law or otherwise, and shall survive any termination of the Loan Documents, the expiration of the Commitments and the payment of all - 90 - 96 indebtedness of the Borrower under the Loan Documents, provided that the Borrower shall have no obligation under this Section to an Indemnified Person with respect to any of the foregoing to the extent found in a final judgment of a court having jurisdiction to have resulted primarily out of the gross negligence or willful misconduct of such Indemnified Person or arising solely from claims between one such Indemnified Person and another such Indemnified Person. 11.13. Governing Law. The Loan Documents and the rights and obligations of the parties thereunder shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of New York, without regard to principles of conflict of laws. 11.14. Headings Descriptive. Section headings have been inserted in the Loan Documents for convenience only and shall not be construed to be a part thereof. 11.15. Severability. Every provision of the Loan Documents is intended to be severable, and if any term or provision thereof shall be invalid, illegal or unenforceable for any reason, the validity, legality and enforceability of the remaining provisions thereof shall not be affected or impaired thereby, and any invalidity, illegality or unenforceability in any jurisdiction shall not affect the validity, legality or enforceability of any such term or provision in any other jurisdiction. 11.16. Integration. All exhibits to a Loan Document shall be deemed to be a part thereof. The Loan Documents embody the entire agreement and understanding among the Borrower, the Administrative Agent and the Lenders with respect to the subject matter thereof and supersede all prior agreements and understandings among the Borrower, the Administrative Agent and the Lenders with respect to the subject matter thereof. 11.17. Consent to Jurisdiction. The Borrower and each of the Credit Parties hereby irrevocably submit to the jurisdiction of any New York State or Federal court sitting in the City of New York over any suit, action or proceeding arising out of or relating to the Loan Documents. The Borrower and each of the Credit Parties hereby irrevocably waive, to the fullest extent permitted or not prohibited by law, any objection which any of them may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in - 91 - 97 such a court and any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum. 11.18. Service of Process. The Borrower hereby agrees that process may be served against it in any suit, action or proceeding referred to in Section 11.17 by sending the same by first class mail, return receipt requested or by overnight courier service, to the address of the Borrower set forth in Section 11.2 or in the applicable Loan Document executed by the Borrower. The Borrower hereby agrees that any such service (i) shall be deemed in every respect effective service of process upon it in any such suit, action, or proceeding, and (ii) shall to the fullest extent enforceable by law, be taken and held to be valid personal service upon and personal delivery to it. 11.19. No Limitation on Service or Suit. Nothing in the Loan Documents or any modification, waiver, consent or amendment thereto shall affect the right of the Administrative Agent or any Lender to serve process in any manner permitted by law or limit the right of the Administrative Agent or any Lender to bring proceedings against the Borrower in the courts of any jurisdiction or jurisdictions in which the Borrower may be served. 11.20. WAIVER OF TRIAL BY JURY. THE ADMINISTRATIVE AGENT, THE CO-DOCUMENTATION AGENTS, THE LENDERS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREIN. FURTHER, THE BORROWER HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF THE ADMINISTRATIVE AGENT, THE CO-DOCUMENTATION AGENTS, THE LENDERS, OR COUNSEL TO THE ADMINISTRATIVE AGENT THE CO-DOCUMENTATION AGENTS OR THE LENDERS, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE ADMINISTRATIVE AGENT, THE CO-DOCUMENTATION AGENTS OR THE LENDERS WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION. THE BORROWER ACKNOWLEDGES THAT THE ADMINISTRATIVE AGENT, THE CO-DOCUMENTATION AGENTS, AND THE LENDERS HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, INTER ALIA, THE PROVISIONS OF THIS SECTION. - 92 - 98 11.21. Termination After the termination of this Agreement in accordance with its terms, without any extension thereof, and the payment in full of all obligations of the Borrower under the Loan Documents (including without limitation, all principal, interest, Facility Fees and other amounts payable hereunder and under the Notes), the obligations of the Borrower hereunder (other than those which are stated herein to survive any termination of this Agreement) shall terminate, except that the foregoing shall not apply with respect to any claim, action or proceeding made or brought under any other provision of the Loan Documents prior to such termination or payment. At the request of the Borrower, each Lender whose obligations under the Notes have been fully paid shall promptly return to the Borrower its Note marked "paid" or shall deliver other evidence that such Lender has received full payment of such obligations. - 93 - 99 IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written. NEW PLAN EXCEL REALTY TRUST, INC. By: /s/ DEAN BERNSTEIN --------------------------------- Dean Bernstein Senior Vice President THE BANK OF NEW YORK, as Administrative Agent and a Lender By: /s/ FREDERICK LAUDISI --------------------------------- Frederick Laudisi Vice President BANK ONE, NA as Co-Documentation Agent and a Lender By: /s/ PATRICIA LEUNG --------------------------------- Name: Patricia Leung Title: Senior Vice President BANKBOSTON, N.A. as Co-Documentation Agent and a Lender By: /s/ DANIEL P. STEGEMOELLER --------------------------------- Name: Daniel P. Stegemoeller Title: Vice President 100 ARGENTARIA, CAJA POSTAL Y BANCO HIPOTECARIO S.A. By: /s/ AUGUSTO GODOY --------------------------------- Name: Augusto Godoy Title: General Manager BANK OF AMERICA, N. A. By: /s/ THOMAS E. SCHUBERT --------------------------------- Name: Title: CHANG HWA COMMERCIAL BANK, LTD., NEW YORK BRANCH By: /s/ WAN-TU YEH --------------------------------- Name: Wan-Tu Yeh Title: VP & General Manager ERSTE BANK By: /s/ PAUL JUDICKE --------------------------------- Name: Paul Judicke Title: Vice President By: /s/ JOHN S. RUNNION --------------------------------- John S. Runnion First Vice President ISRAEL DISCOUNT BANK OF NEW YORK By: /s/ MARC G. COOPER --------------------------------- Name: Marc G. Cooper Title: Vice President By: /s/ CHET DAVIS --------------------------------- Name: Chet Davis Title: First Vice President 101 PNC BANK, N. A. By: /s/ THOMAS NASTAROWICZ --------------------------------- Name: Thomas Nastarowicz Title: Vice President KEY BANK By: /s/ KENNETH A. MCINTYRE, JR. --------------------------------- Name: Kenneth A. McIntyre, Jr. Title: Vice President EX-10.14 7 GUARANTY DATED NOVEMBER 17,1999 1 EXHIBIT 10.14 FACILITY I GUARANTY GUARANTY (as the same may be amended, supplemented or otherwise modified from time to time, this "GUARANTY"), dated as of November 17, 1999, by and among each of the Subsidiaries listed on Schedule I hereto (collectively, the "SUBSIDIARY GUARANTORS") and THE BANK OF NEW YORK, as administrative agent (in such capacity, the "ADMINISTRATIVE AGENT") on behalf of the Lenders under and as defined in the Credit Agreement (hereinafter defined). RECITALS I. Reference is made to the Credit Agreement, dated as of the date hereof, by and among New Plan Excel Realty Trust, Inc., a Maryland corporation, the Lenders party thereto, the Administrative Agent, BANK ONE, NA, as a Co-Documentation Agent, and BANKBOSTON, N.A., as a Co-Documentation Agent (as the same may be amended, supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"). II. The Administrative Agent, the Co-Documentation Agents and the Lenders have made it a condition precedent to the effectiveness of the Credit Agreement that each Subsidiary Guarantor execute and deliver this Guaranty. III. Each Subsidiary Guarantor expects to derive substantial benefit from the Credit Agreement and the transactions contemplated thereby and, in furtherance thereof, has agreed to execute and deliver this Guaranty. Therefore, in consideration of the Recitals, the terms and conditions herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the Subsidiary Guarantors, the Borrower and the Administrative Agent hereby agree as follows: 1. DEFINED TERMS (a) Capitalized terms used herein which are not otherwise defined herein shall have the respective meanings ascribed thereto in the Credit Agreement. (b) When used in this Guaranty, the following capitalized terms shall have the respective meanings ascribed thereto as follows: "BORROWER OBLIGATIONS" means all present and future obligations and liabilities, whether deemed principal, interest, additional interest, fees, expenses or otherwise of the Borrower to the Administrative Agent, the Co-Documentation Agents, 2 and the Lenders, including, without limitation, all obligations under (i) the Credit Agreement, (ii) the Notes and (iii) all other Loan Documents. "GUARANTOR OBLIGATIONS" means, with respect to each Subsidiary Guarantor, all of the obligations and liabilities of such Subsidiary Guarantor hereunder, whether fixed, contingent, now existing or hereafter arising, created, assumed, incurred or acquired. 2. GUARANTEE (a) Subject to Section 2(b), each Subsidiary Guarantor hereby absolutely, irrevocably and unconditionally guarantees the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of the Borrower Obligations. The agreements of each Subsidiary Guarantor in this Guaranty constitute a guarantee of payment, and no Credit Party shall have any obligation to enforce any Loan Document or exercise any right or remedy with respect to any collateral security thereunder by any action, including making or perfecting any claim against any Person or any collateral security for any of the Borrower Obligations prior to being entitled to the benefits of this Guaranty. The Administrative Agent may, at its option, proceed against the Subsidiary Guarantors, or any one or more of them, in the first instance, to enforce the Guarantor Obligations without first proceeding against the Borrower or any other Person, and without first resorting to any other rights or remedies, as the Administrative Agent may deem advisable. In furtherance hereof, if any Credit Party is prevented by law from collecting or otherwise hindered from collecting or otherwise enforcing any Borrower Obligation in accordance with its terms, such Credit Party shall be entitled to receive hereunder from the Subsidiary Guarantors after demand therefor, the sums which would have been otherwise due had such collection or enforcement not been prevented or hindered. (b) Notwithstanding anything to the contrary contained herein, the maximum aggregate amount of the obligations of each Subsidiary Guarantor hereunder shall not, as of any date of determination, exceed the lesser of the greatest amount that is valid and enforceable against such Subsidiary Guarantor under principles of New York State contract law and the greatest amount that would not render such Subsidiary Guarantor's liability hereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11 of the United States Code or any provisions of applicable state law (collectively, the "FRAUDULENT TRANSFER LAWS"), in each case after giving effect to all other liabilities of such Subsidiary Guarantor, contingent or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically excluding, however, any liability (A) in respect of intercompany indebtedness to the Borrower or any Affiliate or Subsidiary of the Borrower, to the extent that such intercompany indebtedness would be discharged to the extent payment is made by such Subsidiary Guarantor hereunder, and (B) under any guarantee of (1) senior unsecured indebtedness - 2 - 3 or (2) indebtedness subordinated in right of payment to any Borrower Obligation, in either case which contains a limitation as to maximum liability similar to that set forth in this Section 2(b) and pursuant to which the liability of such Subsidiary Guarantor hereunder is included in the liabilities taken into account in determining such maximum liability) and after giving effect as assets to the value (as determined under the applicable provisions of the Fraudulent Transfer Laws) of any rights to subrogation, contribution, reimbursement, indemnity or similar rights of such Subsidiary Guarantor pursuant to applicable law or any agreement providing for an equitable allocation among such Subsidiary Guarantor and other Affiliates or Subsidiaries of the Borrower of obligations arising under guarantees by such parties. (c) Each Subsidiary Guarantor agrees that the Guarantor Obligations may at any time and from time to time exceed the maximum aggregate amount of the obligations of such Subsidiary Guarantor hereunder without impairing this Guaranty or affecting the rights and remedies of any Credit Party hereunder. 3. ABSOLUTE OBLIGATION No Subsidiary Guarantor shall be released from liability hereunder unless and until the Commitments of the Lenders have terminated and either (i) the Borrower shall have paid in full the outstanding principal balance of the Loans, together with all accrued and unpaid interest thereon, and all other amounts then due and owing under the Loan Documents, or (ii) the Guarantor Obligations of such Subsidiary Guarantor shall have been paid in full in cash. Each Subsidiary Guarantor acknowledges and agrees that (a) no Credit Party has made any representation or warranty to such Subsidiary Guarantor with respect to the Borrower, any of its Subsidiaries, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or any other matter whatsoever, and (b) such Subsidiary Guarantor shall be liable hereunder, and such liability shall not be affected or impaired, irrespective of (A) the validity or enforceability of any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or the collectability of any of the Borrower Obligations, (B) the preference or priority ranking with respect to any of the Borrower Obligations, (C) the existence, validity, enforceability or perfection of any security interest or collateral security under any Loan Document, or the release, exchange, substitution or loss or impairment of any such security interest or collateral security, (D) any failure, delay, neglect or omission by any Credit Party to realize upon or protect any direct or indirect collateral security, indebtedness, liability or obligation, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or any of the Borrower Obligations, (E) the existence or exercise of any right of set-off by any Credit Party, (F) the existence, validity or enforceability of any other guarantee with respect to any of the Borrower Obligations, the liability of any other Person in respect - 3 - 4 of any of the Borrower Obligations, or the release of any such Person or any other guarantor of any of the Borrower Obligations, (G) any act or omission of any Credit Party in connection with the administration of any Loan Document or any of the Borrower Obligations, (H) the bankruptcy, insolvency, reorganization or receivership of, or any other proceeding for the relief of debtors commenced by or against, any Person, (I) the disaffirmance or rejection, or the purported disaffirmance or purported rejection, of any of the Borrower Obligations, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, in any bankruptcy, insolvency, reorganization or receivership, or any other proceeding for the relief of debtor, relating to any Person, (J) any law, regulation or decree now or hereafter in effect which might in any manner affect any of the terms or provisions of any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith or any of the Borrower Obligations, or which might cause or permit to be invoked any alteration in the time, amount, manner or payment or performance of any of the Borrower's obligations and liabilities (including the Borrower Obligations), (K) the merger or consolidation of the Borrower into or with any Person, (L) the sale by the Borrower of all or any part of its assets, (M) the fact that at any time and from time to time none of the Borrower Obligations may be outstanding or owing to any Credit Party, (N) any amendment or modification of, or supplement to, any Loan Document, or (O) any other reason or circumstance which might otherwise constitute a defense available to or a discharge of the Borrower in respect of its obligations or liabilities (including the Borrower Obligations) or of such Subsidiary Guarantor in respect of any of the Guarantor Obligations (other than by the performance in full thereof). 4. REPRESENTATIONS AND WARRANTIES Each of the Subsidiary Guarantors represents and warrants as to itself that all representations and warranties relating to it contained in the Credit Agreement are true and correct. 5. NOTICES Except as otherwise specifically provided herein, all notices, requests, consents, demands, waivers and other communications hereunder shall be in writing (including facsimile) and shall be given in the manner set forth in Section 11.2 of the Credit Agreement (i) in the case of the Administrative Agent, to the address set forth in Section 11.2 of the Credit Agreement, (ii) in the case of a Subsidiary Guarantor, to the address set forth in Schedule I hereto, or (iii) in the case of each party hereto, to such other addresses as to which the Administrative Agent may be hereafter notified by the respective parties hereto. - 4 - 5 6. EXPENSES Each Subsidiary Guarantor agrees that it shall, promptly after demand, pay to the Administrative Agent any and all reasonable out-of-pocket sums, costs and expenses, which any Credit Party may pay or incur defending, protecting or enforcing this Guaranty (whether suit is instituted or not), reasonable attorneys' fees and disbursements. All sums, costs and expenses which are due and payable pursuant to this Section shall bear interest, payable on demand, at the highest rate then payable on the Borrower Obligations. 7. REPAYMENT IN BANKRUPTCY, ETC. If, at any time or times subsequent to the payment of all or any part of the Borrower Obligations or the Guarantor Obligations, any Credit Party shall be required to repay any amounts previously paid by or on behalf of the Borrower or any Subsidiary Guarantor in reduction thereof by virtue of an order of any court having jurisdiction in the premises, including as a result of an adjudication that such amounts constituted preferential payments or fraudulent conveyances, the Subsidiary Guarantors unconditionally agree to pay to the Administrative Agent, within 10 days after demand, a sum in cash equal to the amount of such repayment, together with interest on such amount from the date of such repayment by such Credit Party to the date of payment to the Administrative Agent at the applicable after-maturity rate set forth in the Credit Agreement. 8. MISCELLANEOUS (a) Except as otherwise expressly provided in this Guaranty, each Subsidiary Guarantor hereby waives presentment, demand for payment, notice of default, nonperformance and dishonor, protest and notice of protest of or in respect of this Guaranty, the other Loan Documents and the Borrower Obligations, notice of acceptance of this Guaranty and reliance hereupon by any Credit Party, and the incurrence of any of the Borrower Obligations, notice of any sale of collateral security or any default of any sort. (b) No Subsidiary Guarantor is relying upon any Credit Party to provide to such Subsidiary Guarantor any information concerning the Borrower or any of its Subsidiaries, and each Subsidiary Guarantor has made arrangements satisfactory to such Subsidiary Guarantor to obtain from the Borrower on a continuing basis such information concerning the Borrower and its Subsidiaries as such Subsidiary Guarantor may desire. (c) Each Subsidiary Guarantor agrees that any statement of account with respect to the Borrower Obligations from any Credit Party to the Borrower which - 5 - 6 binds the Borrower shall also be binding upon such Subsidiary Guarantor, and that copies of said statements of account maintained in the regular course of or such Credit Party's business may be used in evidence against such Subsidiary Guarantor in order to establish its Guarantor Obligations. (d) Each Subsidiary Guarantor acknowledges that it has received a copy of the Loan Documents and has approved of the same. In addition, each Subsidiary Guarantor acknowledges having read each Loan Document and having had the advice of counsel in connection with all matters concerning its execution and delivery of this Guaranty. (e) This Guaranty shall be binding upon each Subsidiary Guarantor and its successors and inure to the benefit of, and be enforceable by the Administrative Agent, Lenders and their respective successors, transferees and assigns. No Subsidiary Guarantor may assign any right, or delegate any duty, it may have under this Guaranty. (f) Subject to the limitations set forth in Section 2(b), the Guarantor Obligations shall be joint and several. (g) This Guaranty is the "Guaranty" referred to in the Credit Agreement, and is subject to, and should be construed in accordance with, the provisions thereof. Each of the parties hereto acknowledges and agrees that the following provisions of the Credit Agreement are made applicable to this Guaranty and all such provisions are incorporated by reference herein as if fully set forth herein, including Sections 1 (Definitions), 2.11 (Taxes; Net Payments), 11.1 (Amendments and Waivers), 11.3 (No Waiver; Cumulative Remedies), 11.5 (Payment of Expenses and Taxes), 11.7 (Successors and Assigns), 11.9 (Counterparts), 11.12 (Indemnity), 11.13 (Governing Law), 11.14, (Headings Description), 11.15 (Severability), 11.16 (Integration), 11.17 (Consent to Jurisdiction), 11.18 (Service of Process), 11.19 (No Limitation on Service or Suit) and 11.20 (WAIVER OF TRIAL BY JURY) thereof. (h) Each Subsidiary Guarantor agrees that (i) the execution and delivery of a Guaranty by any Required Additional Guarantor after the date hereof shall not affect the obligations of the Subsidiary Guarantors hereunder, and (ii) the Subsidiary Guarantors and each such Required Additional Guarantor shall, subject to Section 2(b), be jointly and severally liable for all of the Borrower Obligations. (i) With respect to New Plan Realty Trust, this Guaranty has been negotiated, executed and delivered on behalf of the undersigned by the trustees or officers thereof in their representative capacity under the Declaration of Trust, and not individually, and bind only the trust estate of the undersigned, and no trustee, officer, employee, agent or shareholder of the undersigned shall be bound or held to any personal liability or responsibility in connection with the agreements, obligations and - 6 - 7 undertakings of the undersigned hereunder, and any person or entity dealing with the undersigned in connection therewith shall look only to the trust estate for the payment of any claim or for the performance of any agreement, obligation or undertaking thereunder. The Administrative Agent and each Lender hereby acknowledge and agree that each agreement and other document executed by the undersigned in accordance with or in respect of this transaction shall be deemed and treated to include in all respects and for all purposes the foregoing exculpatory provision. - 7 - 8 FACILITY I IN EVIDENCE of the agreement by the parties hereto to the terms and conditions herein contained, each such party has caused this Subsidiary Guarantee to be duly executed on its behalf. NEW PLAN REALTY TRUST By: /s/ Dean Bernstein ---------------------------------- Name: ---------------------------------- Title: ---------------------------------- EXCEL REALTY TRUST - ST, INC. By: /s/ Dean Bernstein ---------------------------------- Name: ---------------------------------- Title: ---------------------------------- THE BANK OF NEW YORK, as Administrative Agent By: /s/ Frederick Laudisi ---------------------------------- Name: Frederick Laudisi ---------------------------------- Title: Vice President ---------------------------------- 9 FACILITY I SCHEDULE I TO SUBSIDIARY GUARANTY SUBSIDIARY GUARANTORS UNDER GUARANTY DATED AS OF NOVEMBER 17, 1999
Jurisdiction of Incorporation or Address for Name Formation Notices - ------------ -------------------------------- -------------------------------- New Plan Massachusetts 1120 Avenue of the Americas Realty Trust New York, New York 10036 Attention: Dean Bernstein Telephone: (212) 869-3000 Telecopy: (212) 869-3989 Excel Realty Delaware 1120 Avenue of the Americas Trust - ST, Inc. New York, New York 10036 Attention: Dean Bernstein Telephone: (212) 869-3000 Telecopy: (212) 869-3989
EX-10.15 8 CREDIT AGREEMENT DATED NOVEMBER 17,1999 1 Ex. 10.15 FACILITY II ================================================================================ CREDIT AGREEMENT by and among NEW PLAN EXCEL REALTY TRUST, INC. THE LENDERS PARTY HERETO, AND THE BANK OF NEW YORK as Administrative Agent BANK ONE, NA as a Co-Documentation Agent and BANKBOSTON, N.A. as a Co-Documentation Agent Dated as of November 17, 1999 BNY CAPITAL MARKETS, INC. as Sole Lead Arranger and Bookrunner ================================================================================ 2 FACILITY II TABLE OF CONTENTS 1. DEFINITIONS ........................................................................... 1 1.1. Defined Terms ...................................................................... 1 1.2. Other Definitional Provisions ...................................................... 25 2. AMOUNT AND TERMS OF LOANS AND LETTERS OF CREDIT ....................................... 26 2.1. Revolving Credit Loans ........................................................... 26 2.2. Facility Notes ................................................................... 26 2.3. Procedure for Revolving Credit Loan Borrowings Other than Swingline Borrowings and Competitive Bid Borrowings ........................................ 27 2.4. Competitive Bid Borrowings and Procedure for Competitive Bid Borrowings .......... 29 2.5. Termination or Reduction of Commitments .......................................... 34 2.6. Repayment of Loans; Evidence of Debt ............................................. 34 2.7. Prepayments of the Loans ......................................................... 35 2.8. Swingline Loans .................................................................. 36 2.9. Letters of Credit ................................................................ 38 2.10. Conversions ...................................................................... 42 2.11. Interest Rate and Payment Dates .................................................. 43 2.12. Substituted Interest Rate ........................................................ 45 2.13. Taxes; Net Payments .............................................................. 46 2.14. Illegality ....................................................................... 46 2.15. Increased Costs .................................................................. 47 2.16. Indemnification for Break Funding Losses ......................................... 49 2.17. Use of Proceeds .................................................................. 50 2.18. Capital Adequacy ................................................................. 50 2.19. Administrative Agent's Records ................................................... 51 3. FEES; PAYMENTS ........................................................................ 51 3.1. Facility Fee ..................................................................... 51 3.2. Payments; Application of Payments ................................................ 52 4. REPRESENTATIONS AND WARRANTIES ........................................................ 53 4.1. Existence and Power .............................................................. 53 4.2. Authority ........................................................................ 54 4.3. Binding Agreement ................................................................ 54 4.4. Subsidiaries; DownREIT Partnerships .............................................. 54 4.5. Litigation ....................................................................... 55 4.6. Required Consents ................................................................ 55 4.7. No Conflicting Agreements ........................................................ 55 4.8. Compliance with Applicable Laws .................................................. 56 4.9. Taxes ............................................................................ 56 4.10. Governmental Regulations ......................................................... 56 4.11. Federal Reserve Regulations; Use of Loan Proceeds ................................ 56 4.12. Plans; Multiemployer Plans ....................................................... 57 4.13. Financial Statements ............................................................. 57 4.14. Property ......................................................................... 58
3 4.15. Franchises, Intellectual Property, Etc ........................................... 58 4.16. Environmental Matters ............................................................ 58 4.17. Labor Relations .................................................................. 60 4.18. Burdensome Obligations ........................................................... 60 4.19. Solvency ......................................................................... 60 4.20. REIT Status ...................................................................... 61 4.21. Rent Roll and List of Unencumbered Assets ........................................ 61 4.22. Year 2000 ....................................................................... 61 4.23. Operation of Business ............................................................ 61 4.24. No Misrepresentation ............................................................. 61 5. CONDITIONS TO FIRST LOANS OR LETTERS OF CREDIT ........................................ 61 5.1. Evidence of Action ............................................................... 62 5.2. This Agreement ................................................................... 63 5.3. Notes ............................................................................ 63 5.4. Guaranty ......................................................................... 63 5.5. Other Credit Agreement ........................................................... 63 5.6. Litigation ....................................................................... 63 5.7. Opinion of Counsel to the Borrower ............................................... 64 5.8. Fees ............................................................................. 64 5.9. Fees and Expenses of Special Counsel ............................................. 64 5.10. Year 2000 Assurances ............................................................. 64 6. CONDITIONS OF LENDING - ALL LOANS ..................................................... 64 6.1. Compliance ....................................................................... 64 6.2. Loan Closings .................................................................... 65 6.3. Borrowing Request ................................................................ 65 6.4. Documentation and Proceedings .................................................... 65 6.5. Required Acts and Conditions ..................................................... 65 6.6. Approval of Special Counsel ...................................................... 66 6.7. Supplemental Opinions ............................................................ 66 6.8. Other Documents .................................................................. 66 7. AFFIRMATIVE COVENANTS ................................................................. 66 7.1. Financial Statements ............................................................. 66 7.2. Certificates; Other Information .................................................. 68 7.3. Legal Existence .................................................................. 71 7.4. Taxes ............................................................................ 71 7.5. Insurance ........................................................................ 72 7.6. Payment of Indebtedness and Performance of Obligations ........................... 72 7.7. Maintenance of Property; Environmental Investigations ............................ 72 7.8. Observance of Legal Requirements ................................................. 73 7.9. Inspection of Property; Books and Records; Discussions ........................... 73 7.10. Licenses, Intellectual Property .................................................. 74 7.11. Required Additional Guarantors ................................................... 74 7.12. REIT Status; Operation of Business ............................................... 74 7.13. Termination of Existing Credit Agreements ........................................ 74 8. NEGATIVE COVENANTS .................................................................... 75 8.1. Liens ............................................................................ 75 8.2. Merger, Consolidation and Certain Dispositions of Property ....................... 76
- 2 - 4 8.3. Investments, Loans, Etc .......................................................... 76 8.4. Business Changes ................................................................. 78 8.5. Amendments to Organizational Documents ........................................... 78 8.6. Bankruptcy Proceedings ........................................................... 79 8.7. Sale and Leaseback ............................................................... 79 8.8. Transactions with Affiliates ..................................................... 79 8.9. Issuance of Additional Capital Stock by Subsidiary Guarantors .................... 79 8.10. Hedging Agreements ............................................................... 79 8.11. Restricted Payments .............................................................. 80 8.12. Unencumbered Assets Coverage Ratio ............................................... 81 8.13. Fixed Charge Coverage Ratio ...................................................... 81 8.14. Minimum Tangible Net Worth ....................................................... 81 8.15. Maximum Total Indebtedness ....................................................... 81 8.16. Liabilities to Assets Ratio ...................................................... 81 8.17. Maximum Book Value of Ancillary Assets ........................................... 81 9. DEFAULT ............................................................................... 82 9.1. Events of Default ................................................................ 82 10. THE AGENT ............................................................................. 85 10.1. Appointment ...................................................................... 85 10.2. Delegation of Duties ............................................................. 86 10.3. Exculpatory Provisions ........................................................... 86 10.4. Reliance by Administrative Agent ................................................. 86 10.5. Notice of Default ................................................................ 87 10.6. Non-Reliance on Administrative Agent and Other Lenders ........................... 87 10.7. Indemnification .................................................................. 88 10.8. Administrative Agent in Its Individual Capacity .................................. 88 10.9. Successor Administrative Agent ................................................... 88 11. OTHER PROVISIONS ...................................................................... 90 11.1. Amendments and Waivers ........................................................... 90 11.2. Notices .......................................................................... 91 11.3. No Waiver; Cumulative Remedies ................................................... 92 11.4. Survival of Representations and Warranties ....................................... 92 11.5. Payment of Expenses and Taxes .................................................... 93 11.6. Lending Offices .................................................................. 94 11.7. Successors and Assigns ........................................................... 94 11.8. Designated Lender ................................................................ 97 11.9. Counterparts ..................................................................... 97 11.10. Adjustments; Set-off ............................................................. 98 11.11. Lenders' Representations ......................................................... 99 11.12. Indemnity ........................................................................ 99 11.13. Governing Law ....................................................................100 11.14. Headings Descriptive .............................................................100 11.15. Severability .....................................................................100 11.16. Integration ......................................................................100 11.17. Consent to Jurisdiction ..........................................................100 11.18. Service of Process ...............................................................101 11.19. No Limitation on Service or Suit .................................................101 11.20. WAIVER OF TRIAL BY JURY ..........................................................101
- 3 - 5 11.21. Termination ......................................................................102
- 4 - 6 FACILITY II LIST OF EXHIBITS AND SCHEDULES EXHIBITS: -------- Exhibit A - Assignment and Assumption Exhibit B - Commitment Amounts Exhibit C - Competitive Bid Borrowing Request Exhibit D - Compliance Certificate Exhibit E - Conventional Borrowing Request Exhibit F - Guaranty Exhibit G - Swingline Borrowing Request Exhibit H - Facility Note Exhibit I - Swingline Note Exhibit J - Secretary's Certificate (Borrower) Exhibit K - Secretary's Certificate (Guarantor) Exhibit L - Points for Legal Opinions Exhibit M - Designation Agreement Exhibit N - Form of Notice of Conversion SCHEDULES: --------- Schedule I - Domestic and Eurodollar Lending Offices Schedule 4.4 - Subsidiaries (including Subsidiary Guarantors) Schedule 4.5 - Litigation Schedule 4.12 - Plans Schedule 4.21 - Rent Roll and List of Unencumbered Assets Schedule 4.22 - Year 2000 Remediation
7 FACILITY II CREDIT AGREEMENT, dated as of November 17, 1999, by and among NEW PLAN EXCEL REALTY TRUST, INC., a Maryland corporation (the "Borrower"), each lender party hereto or which becomes a "Lender" or a "Designated Lender" pursuant to the provisions of Section 11.7 or 11.8, respectively (each a "Lender" and, collectively, the "Lenders"), THE BANK OF NEW YORK, as administrative agent (in such capacity, the "Administrative Agent"), and BANK ONE, NA and BANKBOSTON, N.A. (each a "Co-Documentation Agent" and, collectively, the "Co-Documentation Agents"). 1. DEFINITIONS 1.1. Defined Terms. As used in this Agreement, terms defined in the preamble have the meanings therein indicated, and the following terms have the following meanings: "ABR Advances": the Loans (or any portions thereof) at such time as they (or such portions) are made and/or being maintained at a rate of interest based upon the Alternate Base Rate. "Accountants": PricewaterhouseCoopers LLP, or after the date hereof, any of: Arthur Andersen LLP; Deloitte & Touche LLP; Ernst & Young LLP; KPMG LLP; or any successor to any of the foregoing, or such other firm of certified public accountants of recognized national standing selected by the Borrower and satisfactory to the Administrative Agent. "Adjusted Net Operating Income": for any period, the aggregate amount of the Net Operating Income from each Unencumbered Asset during such period, less the Capital Expense Reserve for such Unencumbered Asset during such period. "Advance": an ABR Advance, a Eurodollar Advance or a Competitive Bid Advance, as the case may be. "Affected Advance": as defined in Section 2.12. "Affected Principal Amount": in the event that (i) the Borrower shall fail for any reason to borrow or convert after it shall have notified the Administrative Agent of its intent to do so in any instance in which it shall have requested a Eurodollar Advance pursuant to Sections 2.3 or 2.10 or a Swingline Loan pursuant to Section 2.8, or shall have accepted one or more offers of Competitive Bid Advances under Section 2.4, an amount equal to the principal amount of such Eurodollar Advance, 8 Swingline Loan or Competitive Bid Advance; (ii) a Eurodollar Advance, Swingline Loan or Competitive Bid Advance shall terminate for any reason prior to the last day of the Interest Period applicable thereto, an amount equal to the principal amount of such Eurodollar Advance, Swingline Loan or Competitive Bid Advance; or (iii) the Borrower shall prepay or repay all or any part of the principal amount of a Eurodollar Advance, Swingline Loan or Competitive Bid Advance prior to the last day of the Interest Period applicable thereto (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality), an amount equal to the principal amount of such Eurodollar Advance, Swingline Loan or Competitive Bid Advance so prepaid or repaid. "Affiliate": as to any Person, any other Person which, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person. For purposes of this definition, control of a Person shall mean the power, direct or indirect, (i) to vote 10% or more of the securities having ordinary voting power for the election of directors of such Person or (ii) to direct or cause the direction of the management and policies of such Person, whether by contract or otherwise. "Agreement": this Credit Agreement, as the same may be amended, supplemented or otherwise modified from time to time. "Alternate Base Rate": on any date, a rate of interest per annum equal to the higher of (i) the Federal Funds Rate in effect on such date plus 1/2 of 1% or (ii) the BNY Rate in effect on such date. "Ancillary Assets": at any time, all Real Property of the Borrower and its Subsidiaries, or in which the Borrower or any Subsidiary of the Borrower has an interest (either directly or indirectly), and which is (i) a Development Asset, (ii) a mortgage, or (iii) any other Real Property other than an open air shopping center (including single tenant retail properties) or a residential apartment building or residential apartment community (and appurtenant amenities). "Applicable Facility Fee Percentage": at all times during which the applicable Pricing Level set forth below is in effect, a rate per annum equal to the following applicable percentage amount corresponding to such Pricing Level:
Pricing Level Applicable Facility Fee Percentage ------------- ---------------------------------- Pricing Level I 0.125% Pricing Level II 0.175% Pricing Level III 0.175% Pricing Level IV 0.200% Pricing Level V 0.250% Pricing Level VI 0.300% Pricing Level VII 0.400%.
Changes in the Applicable Facility Fee Percentage resulting from a change in a Pricing Level shall become effective as of the opening of business upon the date of - 2 - 9 any change in the Borrower's Senior Debt Rating, as determined by S&P or Moody's, as the case may be, which would affect the applicable Pricing Level. "Applicable Lending Office": (i) in respect of any Lender, (A) in the case of such Lender's ABR Advances and Competitive Bid Advances, its Domestic Lending Office and (B) in the case of such Lender's Eurodollar Advances, its Eurodollar Lending Office, and (ii) in respect of the Swingline Lender and the Issuing Bank, the Domestic Lending Office of each thereof. "Applicable Margin": with respect to the unpaid principal balance of Eurodollar Advances, at all times during which the applicable Pricing Level set forth below is in effect, and with respect to the participation fee payable in respect of Letters of Credit pursuant to Section 3.1(b), the respective percentage set forth below next to such Pricing Level: Pricing Level Applicable Margin ------------- ----------------- Pricing Level I 0.500% Pricing Level II 0.575% Pricing Level III 0.575% Pricing Level IV 0.675% Pricing Level V 0.875% Pricing Level VI 0.950% Pricing Level VII 1.100%.
Changes in the Applicable Margin resulting from a change in a Pricing Level shall become effective as of the opening of business upon the date of any change in the Senior Debt Rating of the Borrower, as determined by S&P or Moody's, as the case may be, which would affect the applicable Pricing Level. "Assignment and Assumption Agreement": an assignment and assumption agreement executed by an assignor and an assignee pursuant to which such assignor assigns to such assignee all or any portion of such assignor's Notes and Commitments, substantially in the form of Exhibit A. "Assignment Fee": as defined in Section 11.7(b). "Authorized Signatory": the chairman of the board, the president, any vice president, the Chief Financial Officer or any other duly authorized officer (acceptable to the Administrative Agent) of the Borrower. - 3 - 10 "Available Commitment Amount": on any day during the Commitment Period, an amount equal to the Total Commitment Amount at such time minus the total of all Competitive Bid Borrowings outstanding on such date. "Benefited Lender": as defined in Section 11.10. "BNY": The Bank of New York. "BNY Rate": a rate of interest per annum equal to the rate of interest publicly announced in New York City by BNY from time to time as its prime commercial lending rate, such rate to be adjusted automatically (without notice) on the effective date of any change in such publicly announced rate. "Borrower's Interest": for any period, (i) with respect to Unencumbered Assets owned by a DownREIT Partnership, a fraction, expressed as a percentage, the numerator of which is the Net Operating Income of such Unencumbered Assets for such period, less any distributions required to be made to partners or members of such DownREIT Partnership, other than the Borrower and its Subsidiaries, and the denominator of which is the Net Operating Income of such Unencumbered Assets for such period, and (ii) with respect to any Ancillary Asset, the percentage of profits and losses with respect thereto to which the Borrower or its Subsidiaries, directly or indirectly, may be entitled to receive for such period. "Borrowing Date": any Business Day specified in a Borrowing Request delivered pursuant to Section 2.3, 2.4 or 2.8, as the case may be, as a date on which the Borrower requests the Lenders or the Swingline Lender to make Loans. "Borrowing Request": a Conventional Borrowing Request, a Competitive Bid Borrowing Request, or a Swingline Borrowing Request, as the case may be. "Business Day": for all purposes other than as set forth in clause (ii) below, (i) any day other than a Saturday, a Sunday or a day on which commercial banks located in New York City are authorized or required by law or other governmental action to close and (ii) with respect to all notices and determinations in connection with, and payments of principal and interest on, Eurodollar Advances, any day which is a Business Day described in clause (i) above and which is also a day on which dealings in foreign currency and exchange and Eurodollar funding between banks may be carried on in London, England. "Capital Leases": leases which have been, or under GAAP are required to be, capitalized. "Capital Expense Reserve": during any period, (i) with respect to each Unencumbered Asset other than a residential apartment building or residential apartment - 4 - 11 community, an amount equal to (A) a per annum rate of $.20 times (B) the total Net Rentable Area of such Unencumbered Asset, and (ii) with respect to each Unencumbered Asset that is a residential apartment building or residential apartment community, an amount equal to (A) $150 times (B) the number of apartment units in such residential apartment building or community (in each case whether or not such reserves are actually established by the Borrower). "Change of Control": the occurrence of any one of the following events: (a) any Person or Persons acting as a group shall acquire direct or indirect ownership of 30% or more of Borrower's common Stock; or (b) during any twelve month period on or after the Effective Date, individuals who at the beginning of such period constituted the Board of Directors of the Borrower (together with any new directors whose election by the Board of Directors or whose nomination for election by the shareholders of the Borrower was approved by a vote of at least a majority of the members of the Board of Directors then in office who either were members of the Board of Directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the members of the Board of Directors then in office; or (c) there occurs a change of control of the Borrower of a nature that would be required to be reported in response to Item 1a of Form 8-K filed pursuant to Section 13 or 15 under the Securities Exchange Act of 1934, or in any other filing by the Borrower with the Securities and Exchange Commission; or (d) the Borrower consolidates with, is acquired by, or merges into or with any Person (other than a merger permitted by Section 8.2). "Chief Financial Officer": at any time, the chief financial officer of the Borrower, or if the Borrower does not have a chief financial officer at such time, the officer designated by the Borrower as its principal financial officer or such other officer of the Borrower that is acceptable to the Administrative Agent. "Code": the Internal Revenue Code of 1986, as the same may be amended from time to time, or any successor thereto, and the rules and regulations issued thereunder, as from time to time in effect. "Commitment": in respect of any Lender, such Lender's undertaking during the Commitment Period to make Revolving Credit Loans and to acquire participations in Letters of Credit and Swingline Loans, subject to the terms and conditions hereof, in an aggregate outstanding principal amount not exceeding such Lender's Commitment Amount. - 5 - 12 "Commitment Amount": the amount set forth next to the name of such Lender in Exhibit B under the heading "Commitments" as such Lender's Commitment Amount, as the same may be reduced pursuant to Section 2.5. "Commitment Percentage": on any day, and as to any Lender, the quotient of (i) such Lender's Commitment Amount on such day, divided by (ii) the Commitments of all Lenders on such day. "Commitment Period:" the period from the Effective Date through the day preceding the Revolving Credit Expiration Date. "Competitive Bid Advance": the Revolving Credit Loans (or any portions thereof) at such time as they (or such portions) consist of Competitive Bid Borrowings as provided for in Section 2.4. "Competitive Bid Borrowing": a borrowing pursuant to Section 2.4 consisting of simultaneous Competitive Bid Advances from each Lender whose offer to make a Competitive Bid Advance as part of such borrowing has been accepted by the Borrower under the auction bidding procedure set forth in Section 2.4. "Competitive Bid Borrowing Request": a borrowing request in the form of Exhibit C. "Competitive Bid Ceiling": at any time, an amount equal to 50% of the Total Commitment Amount at such time. "Compliance Certificate": a certificate substantially in the form of Exhibit D. "Consolidated": the Borrower and its Subsidiaries which are consolidated for financial reporting purposes. "Consolidated EBITDA": for any period, net income for such period of the Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, plus, without duplication and to the extent deducted in determining such net income, the sum of (i) Consolidated Interest Expense for such period, (ii) the aggregate amount of any taxes paid during such period, (iii) the aggregate amount attributable to depreciation and amortization for such period, (iv) the aggregate amount of extraordinary charges during such period and (v) the aggregate amount of non-cash expenses during such period, and minus, without duplication and to the extent added in determining such net income for such period, the aggregate amount of extraordinary gains during such period. - 6 - 13 "Consolidated Fixed Charges": during any period, the sum of each of the following with respect to the Borrower and its Subsidiaries (without duplication), determined on a Consolidated basis in accordance with GAAP: (i) the aggregate amount of all interest expense, both expensed and capitalized (including Consolidated Interest Expense) for such period, (ii) the aggregate of all scheduled principal amounts that become payable during such period in respect of any Indebtedness of the Borrower or its Subsidiaries (excluding balloon payments at maturity) and (iii) the aggregate amount of all cash dividends paid during such period in respect of preferred stock of the Borrower or its Subsidiaries. "Consolidated Interest Expense": for any period, interest and fees accrued, accreted or paid by the Borrower and its Subsidiaries during such period in respect of Consolidated Total Indebtedness, determined in accordance with GAAP, including (a) the amortization of debt discounts to the extent included in interest expense in accordance with GAAP, (b) the amortization of all fees (including fees with respect to interest rate cap agreements or other agreements or arrangements entered into by the Borrower or any of its Subsidiaries designed to protect the Borrower or such Subsidiaries, as applicable, against fluctuations in interest rates) payable in connection with the incurrence of any Indebtedness to the extent included in interest expense in accordance with GAAP and (c) the portion of any rents payable under capital leases allocable to interest expense in accordance with GAAP. "Consolidated Total Indebtedness": as of any date, the aggregate principal amount of all Indebtedness of the Borrower and its Subsidiaries determined on a Consolidated basis in accordance with GAAP, plus, if not otherwise required to be reflected in the Borrower's Consolidated balance sheet (and without duplication) (i) Contingent Obligations of the Borrower and its Subsidiaries on such date which are required in accordance with GAAP to be disclosed in a footnote to any such balance sheet, and (ii) any guarantee by the Borrower of any Indebtedness of an unconsolidated Subsidiary or joint venture in which the Borrower is a direct or indirect investor (to the full extent of the amount of such guaranteed Indebtedness on such date). "Contingent Obligation": as to any Person, any obligation of such Person guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations ("Primary Obligations") of any other Person (the "Primary Obligor") in any manner, whether directly or indirectly, and whether arising from partnership or keep-well agreements, including, without limitation, any obligation of such Person, whether contingent or not contingent (a) to purchase any such Primary Obligation or any Property constituting direct or indirect security therefor, (b) to advance or supply funds (i) for the purchase or payment of any such Primary Obligation or (ii) to maintain working capital or equity capital of the Primary Obligor or otherwise to maintain net worth, solvency or other financial statement condition of the Primary Obligor, (c) to purchase Property, securities or services primarily for the purpose of assuring the beneficiary of any such - 7 - 14 Primary Obligation of the ability of the Primary Obligor to make payment of such Primary Obligation or (d) otherwise to assure, protect from loss or hold harmless the beneficiary of such Primary Obligation against loss in respect thereof; provided, however, that the term Contingent Obligation shall not include the endorsement of instruments for deposit or collection in the ordinary course of business. The term Contingent Obligation shall also include the liability of a general partner in respect of the liabilities of the partnership in which it is a general partner. The amount of any Contingent Obligation of a Person shall be deemed to be an amount equal to the stated or determinable amount of the Primary Obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith. "Conventional Advance": an ABR Advance and/or a Eurodollar Advance. "Conventional Borrowing Request": a borrowing request in the form of Exhibit E. "Conversion Date": the date on which a Eurodollar Advance is converted to an ABR Advance, or the date on which an ABR Advance is converted to a Eurodollar Advance, or the date on which a Eurodollar Advance is converted to a new Eurodollar Advance, all in accordance with Section 2.10. "Credit Party": the Administrative Agent, the Lead Arranger, the Co-Documentation Agents, the Issuing Bank, the Swingline Lender, each Lender and their successors and assigns. "Default": any event or condition which constitutes an Event of Default or which, with the giving of notice, the lapse of time, or any other condition, would, unless cured or waived, become an Event of Default. "Defaulting Lender": at any time, any Lender that, at such time, (i) has failed to comply with any of its obligations to make a Loan, fund its share of any LC Disbursement or acquire a participation in any Swingline Loan as required pursuant to Section 2.3, 2.4, 2.8 or 2.9 of this Agreement, (ii) has failed to pay to the Administrative Agent or any Lender an amount owed by such Lender pursuant to the terms of this Agreement or any of the other Loan Documents, or (iii) has advised the Administrative Agent that it does not intend to comply with its obligations under Section 2.3, 2.4, 2.8 or 2.9 by reason of having been deemed insolvent or having become subject to a bankruptcy or insolvency proceeding. "Designated Lender": a special purpose corporation that is engaged in making, purchasing, or otherwise investing in commercial loans in the ordinary course of its business and that issues (or the parent of which issues) commercial paper rated at least - 8 - 15 "Prime-1" (or the then equivalent grade) by Moody's or "A-1" (or the then equivalent grade) by S&P that, in either case, (i) is organized under the laws of the United States or any state thereof, (ii) shall have become a party to this Agreement pursuant to Section 11.8 for the sole purposes of funding Competitive Bid Advances on behalf of a Designating Lender and (iii) is not otherwise a Lender. "Designating Lender": as defined in Section 11.8. "Designation Agreement": a designation agreement in substantially the form of Exhibit M hereto entered into between a Lender (other than a Designated Lender) and a Designated Lender, and accepted by the Administrative Agent. "Development Asset": any Property of the Borrower or its Subsidiaries, or in which the Borrower or any of its Subsidiaries has an interest (either directly or indirectly) (i) which is new construction, or which is undergoing an expansion which will increase the Net Rentable Area of such Property by 20,000 square feet or more (provided that with respect to any Property which is under expansion, if the balance thereof is a fully integrated, rentable property, then only the portion of such Property that is under expansion shall be a Development Asset), and (ii) for which a certificate of occupancy, whether temporary or permanent, or the functional equivalent thereof, has not been issued with respect to such construction or expansion. Notwithstanding the foregoing, any such new construction or expansion which shall have been a Development Asset under the criteria of this definition shall no longer be a Development Asset upon such time as (A) the same is an income-producing Property in operating condition, and (B) at least 70% of the Net Rentable Area (determined on an "as completed" basis) of such construction or expansion is initially leased to tenants who have taken possession thereof. "Dollars" and "$": lawful currency of the United States of America. "Domestic Lending Office": in respect of any Lender, the Swingline Lender and the Issuing Bank, initially, the office or offices of such Lender, the Swingline Lender and the Issuing Bank designated as such on Schedule I; thereafter, such other office of such Lender, the Swingline Lender and the Issuing Bank through which it shall be making or maintaining ABR Advances or Competitive Bid Advances, making Swingline Loans or issuing Letters of Credit, as reported by such Lender, the Swingline Lender or the Issuing Bank to the Administrative Agent and the Borrower. "DownREIT Partnership": Excel Realty Partners, L.P., E. H. Properties, L.P. and any other partnership or limited liability company hereafter created by the Borrower for the purpose of acquiring assets qualifying as "real estate assets" under Section 856(c) of the Code through the issuance of partnership or limited liability company units in such partnership or limited liability company to third parties, provided that, in the case of each such entity (including Excel Realty Partners, L.P. and E.H. - 9 - 16 Properties, L.P.) (i) the Borrower or a wholly owned Subsidiary of the Borrower is the sole general partner or managing member of such partnership or limited liability company, as the case may be, and (ii) the Borrower or its wholly owned Subsidiary shall be entitled to receive not less than 99% of the net income and gains before depreciation, if any, from such partnership or limited liability company after the limited partners or non-managing members of such partnership or limited liability company receive a stipulated distribution. Any partnership or limited liability company created after the Effective Date must be approved by the Administrative Agent as a "DownREIT Partnership" for purposes of being included in this definition. "Effective Date": the date on which the conditions specified in Section 5 are satisfied. "Environmental Laws": any and all federal, state and local laws relating to the environment, the use, storage, transporting, manufacturing, handling, discharge, disposal or recycling of hazardous substances, materials or pollutants or industrial hygiene and including, without limitation, (i) the Comprehensive Environmental Response, Compensation and Liability Act, as amended, 42 USCA Section 9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976, as amended, 42 USCA Section 6901 et seq.; (iii) the Toxic Substance Control Act, as amended, 15 USCA Section 2601 et seq.; (iv) the Water Pollution Control Act, as amended, 33 USCA Section 1251 et seq.; (v) the Clean Air Act, as amended, 42 USCA Section 7401 et seq.; (vi) the Hazardous Material Transportation Act, as amended, 49 USCA Section 1801 et seq. and (viii) all rules, regulations, judgments, decrees, injunctions and restrictions thereunder and any analogous state law. "Environmental Risk Property": any Real Property of the Borrower, a Subsidiary Guarantor or a DownREIT Partnership in respect of which, at any time: (i) Hazardous Substances are (A) generated or manufactured on, transported to or from, treated at, stored at or discharged from such Real Property in violation of any Environmental Laws; (B) discharged into subsurface waters under such Real Property in violation of any Environmental Laws; or (C) discharged from such Real Property on or into property or waters (including subsurface waters) adjacent to such Real Property in violation of any Environmental Laws, and any of the foregoing events in (A), (B) or (C) has an Adverse Environmental Impact; or (ii) there exists with respect to such Real Property (A) a claim, demand, suit, action, proceeding, event, condition, report, directive, lien, violation, or non-compliance concerning any liability (including, without limitation, potential liability for enforcement, investigatory costs, cleanup costs, government response costs, removal costs, remedial costs, natural resources damages, property damages, personal injuries or penalties) arising in connection - 10 - 17 with: (x) any non-compliance with or violation of the requirements of any applicable Environmental Laws, or (y) the presence of any Hazardous Substance on such Real Property or the release of any Hazardous Substance into the environment from such Real Property, or (B) any actual liability in connection with the presence of any Hazardous Substance on such Real Property or the release of any Hazardous Substance into the environment from such Real Property, and any of the foregoing events in (A) or (B) has an Adverse Environmental Impact. For purposes of this definition, the term "Adverse Environmental Impact" shall mean any event described in clauses (A), (B) or (C) of paragraph (i) above or clauses (A) or (B) of paragraph (ii) above which could reasonably be expected to have a material adverse effect on (1) the value of such Real Property, (2) the marketability of such Real Property, or (3) the ability to finance or refinance such Real Property. "ERISA": the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations issued thereunder, as from time to time in effect. "ERISA Affiliate": any Person which is a member of any group of organizations (i) described in Section 414(b) or (c) of the Code of which the Borrower is a member, or (ii) solely for purposes of potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code and the Lien created under Section 302(f) of ERISA and Section 412(n) of the Code, described in Section 414(m) or (o) of the Code of which the Borrower is a member. "ERISA Liabilities": without duplication, the aggregate of all unfunded vested benefits under all Plans and all potential withdrawal liabilities under all Multiemployer Plans. "Eurodollar Advance": collectively, the Loans (or any portions thereof), other than Competitive Bid Advances, at such time as they (or such portions) are made and/or being maintained at a rate of interest based upon a particular Eurodollar Rate; and "Eurodollar Advances" shall mean all such Eurodollar Advances in the aggregate. "Eurodollar Lending Office": in respect of any Lender, initially, the office, branch or affiliate of such Lender designated as such on Schedule I (or, if no such office branch or affiliate is specified, its Domestic Lending Office); thereafter, such other office, branch or affiliate of such Lender through which it shall be making or maintaining Eurodollar Advances, as reported by such Lender to the Administrative Agent and the Borrower. - 11 - 18 "Eurodollar Rate": with respect to each Eurodollar Advance and as determined by the Administrative Agent, the rate of interest per annum (rounded, if necessary, to the nearest 1/100 of 1% or, if there is no nearest 1/100 of 1%, then to the next higher 1/100 of 1%) equal to a fraction, the numerator of which is the rate per annum quoted by BNY at approximately 12:00 P.M. (or as soon thereafter as practicable) two Eurodollar Business Days prior to the first day of such Interest Period to leading banks in the interbank eurodollar market as the rate at which BNY is offering Dollar deposits in an amount approximately equal to its Commitment Percentage of such Eurodollar Advance and having a period to maturity approximately equal to the Interest Period applicable to such Eurodollar Advance, and the denominator of which is an amount equal to 1.00 minus the aggregate of the then stated maximum rates during such Interest Period of all reserve requirements (including marginal, emergency, supplemental and special reserves), expressed as a decimal, established by the Board of Governors of the Federal Reserve System and any other banking authority to which BNY and other major United States money center banks are subject, in respect of eurocurrency liabilities. "Event of Default": any of the events specified in Section 9, provided that any requirement for the giving of notice, the lapse of time or any other condition specified in Section 9 has been satisfied. "Existing Credit Agreements" shall mean that (i) certain Revolving Credit Agreement dated as of November 21, 1997 among New Plan Realty Trust (as predecessor in interest to the Borrower), The Bank of New York, as Administrative Agent, and the lenders signatory thereto, as the same has been amended and assumed by the Borrower, (ii) that certain First Amended and Restated Revolving Credit Agreement, dated as of March 31, 1998, among the Borrower (successor by merger to Excel Realty Trust, Inc.), BankBoston, N.A., as Agent, and the lenders signatory thereto, as the same has been amended, and (iii) that certain Term Loan Agreement, dated July 13, 1999, among the Borrower, The Bank of New York, as agent, and the lenders party thereto. "Facility Exposure": with respect to any Lender at any time, the sum of the (i) aggregate outstanding principal amount of such Lender's Revolving Credit Loans, (ii) LC Exposure and (iii) Swingline Exposure at such time. "Facility Note:" as defined in Section 2.2(a). "Facility Fee": as defined in Section 3.1. "Federal Funds Rate": for any day, a rate per annum (expressed as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%), equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published - 12 - 19 by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that (i) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average of the quotations for such day on such transactions received by BNY as determined by BNY and reported to the Administrative Agent. "Financial Statements": as defined in Section 4.13. "Fixed Charge Coverage Ratio": for any period, the ratio of (i) Consolidated EBITDA during such period to (ii) Consolidated Fixed Charges during such period. "Fixed Rate Advance": A Eurodollar Advance, a Competitive Bid Advance or a Swingline Loan. "Funds from Operations": With respect to any Person for any fiscal period, the sum of (i) the net income of such Person for such fiscal period (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and sales of property, (ii) depreciation and amortization, and (iii) other non-cash items, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. "GAAP": generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statement by such other entity as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination, consistently applied. "Governmental Authority": any nation or government, any state or other political subdivision thereof, any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and any court or arbitrator. "Ground Lease": a ground lease in favor of the Borrower, a wholly owned Subsidiary or a DownREIT Partnership which has an unexpired term of 30 years or more (inclusive of any tenant-controlled renewal options) and which includes within its terms those rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold estate demised pursuant to such ground lease. - 13 - 20 "Guaranty": collectively, (i) a Guaranty, substantially in the form of Exhibit F executed by each of the Subsidiary Guarantors identified on Schedule 4.4 and delivered to the Administrative Agent for the benefit of the Lenders on or prior to the Effective Date, and (ii) each additional Guaranty substantially in the form of Exhibit F executed by each Required Additional Guarantor and delivered to the Administrative Agent for the benefit of the Lenders after the Effective Date. "Hazardous Substance": any hazardous or toxic substance, material or waste, including, but not limited to, (i) those substances, materials, and wastes listed in the United States Department of Transportation Hazardous Materials Table (49 CFR 172.101) or by the Environmental Protection Agency as hazardous substances (40 CFR Part 302) and amendments thereto and replacements therefor and (ii) any substance, pollutant or material defined as, or designated in, any Environmental Law as a "hazardous substance," "toxic substance," "hazardous material," "hazardous waste," "restricted hazardous waste," "pollutant," "toxic pollutant" or words of similar import. "Hedging Agreement" means any interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement. "Highest Lawful Rate": with respect to any Lender and the Swingline Lender, the maximum rate of interest, if any, that at any time or from time to time may be contracted for, taken, charged or received by such Lender or the Swingline Lender on its Note or which may be owing to such Lender or the Swingline Lender pursuant to this Agreement under the laws applicable to such Lender or the Swingline Lender and this Agreement. "Indebtedness": as to any Person, at a particular time, all items which constitute, without duplication, (a) indebtedness for borrowed money (including, without limitation, indebtedness under this Agreement and the Notes) or the deferred purchase price of Property (other than trade payables incurred in the ordinary course of business), (b) indebtedness evidenced by notes, bonds, debentures or similar instruments, (c) obligations with respect to any conditional sale or title retention agreement, (d) indebtedness arising under acceptance facilities and the amount available to be drawn under all letters of credit issued for the account of such Person and, without duplication, all drafts drawn thereunder to the extent such Person shall not have reimbursed the issuer in respect of the issuer's payment of such drafts, (e) all liabilities secured by any Lien on any Property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof (other than carriers', warehousemen's, mechanics', repairmen's or other like non-consensual statutory Liens arising in the ordinary course of business), (f) obligations under Capital Leases, (g) Contingent Obligations and (h) ERISA Liabilities. - 14 - 21 "Indemnified Person": as defined in Section 11.12. "Intellectual Property": all copyrights, trademarks, patents, trade names and service names. "Interest Payment Date": (i) as to any ABR Advance, the first day of each month commencing on the first such day to occur after such ABR Advance is made or any Eurodollar Advance is converted to an ABR Advance, (ii) as to any Eurodollar Advance in respect of which the Borrower has selected an Interest Period of one, two or three months, the last day of such Interest Period, (iii) as to any Eurodollar Advance in respect of which the Borrower has selected an Interest Period of six months, the day which is three months after the first day of such Interest Period and the last day of such Interest Period, (iv) as to any Competitive Bid Advance in respect of which the Borrower has selected an Interest Period of 90 days or less, the last day of the Interest Period applicable thereto, (v) as to any Competitive Bid Advance in respect of which the Borrower has selected an Interest Period of more than 90 days, the day which is 90 days after the first day of such Interest Period and the last day of such Interest Period, and (vi) as to any Swingline Loan, the last day of the Interest Period applicable to such Swingline Loan. "Interest Period": (i) with respect to any Eurodollar Advance requested by the Borrower, the period commencing on, as the case may be, the Borrowing Date or Conversion Date with respect to such Eurodollar Advance and ending one, two, three or six months thereafter, as selected by the Borrower in its irrevocable Borrowing Request as provided in Section 2.3 or its irrevocable notice of conversion as provided in Section 2.10, (ii) with respect to any Competitive Bid Advance, the period commencing on the Borrowing Date with respect to such Competitive Bid Advance and ending on the maturity date thereof specified in the Competitive Bid Borrowing Request with respect thereto given pursuant to Section 2.4, and (iii) with respect to any Swingline Loan, the period commencing on the Borrowing Date with respect to such Swingline Loan and ending on the maturity date thereof specified in the Swingline Borrowing Request given pursuant to Section 2.8(c); provided, however, that all of the foregoing provisions relating to Interest Periods are subject to the following: (a) if any Interest Period pertaining to a Eurodollar Advance would otherwise end on a day which is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month, in which event such Interest Period shall end on the immediately preceding Business Day; (b) if, with respect to the borrowing of any Loan as a Eurodollar Advance or the conversion of one Advance to another pursuant to Section 2.10, the Borrower shall fail to give due notice as provided in Section 2.3 or 2.10, as the case may - 15 - 22 be, the Borrower shall be deemed to have elected that such Loan or Advance shall be made as an ABR Advance; (c) any Interest Period 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 a calendar month; (d) no such Interest Period shall end after the last day of the Commitment Period; (e) the Borrower shall select Interest Periods so as not to have more than six different Interest Periods outstanding at any one time with respect to Eurodollar Advances and three different Interest Periods outstanding at any one time with respect to Competitive Bid Advances; (f) no Interest Period pertaining to a Competitive Bid Advance shall be shorter than 7 days or longer than 180 days; (g) no Interest Period pertaining to a Swingline Loan shall be shorter than 7 days or longer than 30 days; and (h) each Interest Period for a Competitive Bid Advance and a Swingline Loan must commence and end on a Business Day. "Investments": as defined in Section 8.3. "Issuing Bank": BNY, in its capacity as issuer of Letters of Credit. "LC Disbursement": a payment made by the Issuing Bank pursuant to a Letter of Credit. "LC Exposure": at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the aggregate amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any Lender at any time shall be its Commitment Percentage of the total LC Exposure at such time. "LC Sublimit": $10,000,000.00 "Lead Arranger": BNY Capital Markets, Inc. "Letter of Credit": any letter of credit, and any successive renewals thereof, issued or made pursuant to this Agreement. - 16 - 23 "Lien": any mortgage, pledge, hypothecation, assignment, deposit or preferential arrangement, encumbrance, lien (statutory or other), or other security agreement or security interest of any kind or nature whatsoever, including, without limitation, any conditional sale or other title retention agreement and any capital or financing lease having substantially the same economic effect as any of the foregoing. "Loan" and "Loans": a Revolving Credit Loan (or Loans), a Competitive Bid Borrowing (or Borrowings) or a Swingline Loan (or Loans), as the case may be. All Loans shall be made in Dollars. "Loan Documents": collectively, this Agreement, the Guaranty (and each Guaranty subsequently delivered pursuant to Section 7.11) and the Notes. "Margin Stock": any "margin stock", as said term is defined in Regulation U of the Board of Governors of the Federal Reserve System, as the same may be amended or supplemented from time to time. "Material Adverse Effect": a material adverse effect on (i) the financial condition, operations, business, or Properties of (A) the Borrower or (B) the Borrower and its Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform its obligations under the Loan Documents or (iii) the ability of the Administrative Agent and the Lenders to enforce the Loan Documents. "Maturity Date": (i) with respect to Revolving Credit Loans made as Conventional Advances, the earlier of the Revolving Credit Termination Date or the date on which the Notes shall become due and payable, whether by acceleration or otherwise, (ii) with respect to Competitive Bid Borrowings, the date each such Competitive Bid Borrowing is due in accordance with Section 2.4(f) or by acceleration, and (iii) with respect to each Swingline Loan, the earlier of the last day of the Interest Period applicable to such Swingline Loan or the date on which the Swingline Note shall become due and payable, whether by acceleration or otherwise. "Moody's": Moody's Investors Services, Inc. "Multiemployer Plan": a plan defined as such Section 3(37) of ERISA to which contributions have been made by the Borrower or any ERISA Affiliate and which is covered by Title IV of ERISA. "Net Operating Income": for any period, and with respect to all assets which are Unencumbered Assets during such period, net-income for such period, determined in accordance with GAAP, attributable to Unencumbered Assets, plus depreciation and amortization, interest expense and any extraordinary or non-recurring losses deducted in calculating such net income, minus extraordinary or non-recurring - 17 - 24 gains and payments (including rent insurance proceeds and condemnation awards) included in such net income, minus any portion of such net income attributable to rents paid by any tenant which is an Affiliate of the Borrower, minus an amount (but not less than zero) equal to the difference between (i) 3% of Operating Income for such period, less (ii) management fees payable in respect of such Unencumbered Assets during such period. For purposes of any calculation of Net Operating Income, real estate taxes, ground rent and insurance, shall be included only at their stabilized, recurring levels. "Net Rentable Area": with respect to any Real Property, the floor area of any buildings, structures or improvements thereof (expressed in square feet) available for leasing to tenants, as determined in accordance with the leases or site plans or leasing plans for such Real Property, or if such leases or site plans do not set forth the floor area demised thereunder (or if such Real Property is not subject to a lease), then as determined by the Borrower in accordance with an industry-accepted protocol approved by the Administrative Agent. "Non-Recourse Exclusions": With respect to any Indebtedness of any Person which is secured by one or more parcels of Real Property or interests therein and which is not a general obligation of such Person, any usual and customary exclusions from the non-recourse limitations governing such Indebtedness, including, without limitation, exclusions for claims that (i) are based on fraud, intentional misrepresentation or misapplication of funds, (ii) result from intentional mismanagement of or waste at such Real Property, (iii) arise from the presence of Hazardous Substances on such Real Property; or (iv) are the result of any unpaid real estate taxes and assessments. "Non-Recourse Indebtedness": At any time, Indebtedness of the Borrower and of its Subsidiaries at such time which is secured by one or more parcels of Real Property or interests therein and which is not a general obligation of the Borrower or such Subsidiary, the holder of such Indebtedness having recourse solely to the parcels of Real Property securing such Indebtedness, the leases thereon and the rents and profits thereof (except for recourse against the general credit of the Borrower or its Subsidiaries for any Non-Recourse Exclusions), provided that in calculating the amount of Non-Recourse Indebtedness at any time, the amount of any Non-Recourse Exclusions which are the subject of a final judgment shall not be included in Non-Recourse Indebtedness. "Note" and "Notes": collectively, the Facility Notes and the Swingline Note. "Operating Property": Any Real Property which at any time (i) is an income-producing property in operating condition and in respect of which no material part thereof has been damaged by fire or other casualty (unless such damage has been repaired) or condemned (unless such condemnation has been restored), (ii) is a retail shopping center, residential apartment building, office building or other operating - 18 - 25 Property, (iii) for which a certificate of occupancy, whether temporary or permanent, or the functional equivalent thereof, has been issued for all improvements comprising the same and are in full force and effect, and (iv) is at least 60% occupied by tenants who have accepted the property and are paying rent in accordance with the terms of their leases, and "Operating Properties" means all such Operating Properties, collectively. "Other Credit Agreement": that certain Credit Agreement of even date herewith among the Borrower, the Administrative Agent, the Co-Documentation Agents and the Lenders party thereto providing for a senior 364-day revolving credit facility in favor of the Borrower, as the same may be amended from time to time. "Participating Lender": defined in Section 2.4. "PBGC": the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA, or any Governmental Authority succeeding to the functions thereof. "Permitted Liens": Liens permitted to exist under Section 8.1. "Person": an individual, a partnership, a corporation, a business trust, a limited liability company, a joint stock company, a trust, an unincorporated association, a joint venture, a Governmental Authority or any other entity of whatever nature. "Plan": any employee benefit or other plan established or maintained by the Borrower or any ERISA Affiliate and which is covered by or subject to the minimum funding standards of Title IV of ERISA, other than a Multiemployer Plan. "Pricing Level": one of the following seven pricing levels, as applicable, provided that if the ratings by S&P and Moody's in any such Pricing Level are split by more than one equivalent rating level, the operative rating would be deemed to be one rating level higher than the lower of the two ratings, and provided, further, that during any period that the Borrower has no Senior Debt Rating, Pricing Level VII would be the applicable Pricing Level: "Pricing Level I": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to AA- by S&P or Aa3 by Moody's; "Pricing Level II": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to A by S&P or A2 by Moody's and Pricing Level I is not applicable; - 19 - 26 "Pricing Level III": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to A- by S&P or A3 by Moody's and Pricing Levels I and II are not applicable; "Pricing Level IV": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to BBB+ by S&P or Baa1 by Moody's and Pricing Levels I, II and III are not applicable; "Pricing Level V": the Pricing Level which would be applicable for so long as the Senior Debt Rating is equal to BBB by S&P or Baa2 by Moody's and Pricing Levels I, II, III and IV are not applicable; "Pricing Level VI": the Pricing Level which would be applicable for so long as the Senior Debt Rating is equal to BBB- by S&P or Baa3 by Moody's and Pricing Levels I, II, III, IV and V are not applicable; and "Pricing Level VII": the Pricing Level which would be applicable for so long as the Senior Debt Rating is less than or equal to BB+ by S&P or Ba1 by Moody's and Pricing Levels I, II, III, IV, V and VI are not applicable. "Property": all types of real, personal, tangible, intangible or mixed property. "Proposed Bid Rate": as applied to any Remaining Interest Period with respect to a Lender's Competitive Bid Advance, or the Swingline Lender's Swingline Rate with respect to one or more Swingline Loans, the rate per annum that such Lender or the Swingline Lender in good faith would have quoted to the Borrower had the Borrower requested that such Lender or the Swingline Lender offer to make a Competitive Bid Advance or Swingline Loan on the first day of such Remaining Interest Period, assuming no Default or Event of Default existed on such day and that the Borrower had the right to borrow hereunder on such day; each such rate to be determined by such Lender or the Swingline Lender, as the case may be, in good faith in its sole discretion. "Rated Period": Any period during which S&P and Moody's are maintaining a Senior Debt Rating and such Senior Debt Rating is at least BBB- as determined by S&P, and at least Baa3, as determined by Moody's. "Real Property": all real Property, and all interests in real Property, owned, leased or held by the Borrower or any Subsidiary of the Borrower. "REIT": a Person qualifying as a real estate investment trust under sections 856-859 of the Code and the regulations and rulings of the Internal Revenue Service issued thereunder. - 20 - 27 "Remaining Interest Period": (i) in the event that the Borrower shall fail for any reason to borrow a Loan in respect of which it shall have requested a Eurodollar Advance or Swingline Loan or convert an Advance to a Eurodollar Advance after it shall have notified the Administrative Agent of its intent to do so pursuant to Section 2.3 or 2.10 or accepted one or more offers of Competitive Bid Advances under Section 2.4, a period equal to the Interest Period that the Borrower elected in respect of such Eurodollar Advance, Swingline Loan or Competitive Bid Advance; or (ii) in the event that a Eurodollar Advance or Competitive Bid Advance shall terminate for any reason prior to the last day of the Interest Period applicable thereto, a period equal to the remaining portion of such Interest Period if such Interest Period had not been so terminated; or (iii) in the event that the Borrower shall prepay or repay all or any part of the principal amount of a Eurodollar Advance, Swingline Loan or Competitive Bid Advance (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality) prior to the last day of the Interest Period applicable thereto, or the Swingline Rate in respect of any Swingline Loan shall have been converted to the Alternate Base Rate pursuant to Section 2.11(a), a period equal to the period from and including the date of such prepayment or repayment to but excluding the last day of such Interest Period. "Rent Roll": a schedule prepared by the Borrower from time to time identifying (i) the Real Property owned by the Borrower or its Subsidiaries and stating whether such items of Real Property are Unencumbered Assets at such time, (ii) the annual base rent payable under each lease of Real Property owned by the Borrower or any of its Subsidiaries, (iii) the commencement and termination dates of the term of each such lease, (iv) any renewal options with respect to such lease, (v) the Net Rentable Area of the space demised under each such lease and (vi) such other information as the Administrative Agent may reasonably require. "Required Additional Guarantors": any Subsidiary required to execute and deliver a Guaranty pursuant to Section 7.11. "Required Lenders": means (a) so long as the Commitments remain in effect (i) if no Loans are outstanding at such time or there are Loans comprised of Conventional Advances or Swingline Loans and Competitive Bid Advances, Lenders (other than Defaulting Lenders or Designated Lenders) having Commitments equal to at least 51% of the Commitments of all Lenders at such time; (ii) if Loans outstanding at such time are comprised of Conventional Advances and/or Swingline Loans only, Lenders (other than Defaulting Lenders or Designated Lenders) holding Notes having an unpaid principal balance equal to at least 51% of the aggregate Loans then outstanding; and (iii) if Loans outstanding at such time are comprised of Competitive Bid Advances only, Lenders (other than Defaulting Lenders or Designated Lenders) having Commitments equal to at least 51% of the Commitments of all Lenders at such time (whether used or unused); and (b) if the Commitments have been terminated, Lenders - 21 - 28 (other than Defaulting Lenders, but including Designated Lenders) whose Loans have an unpaid principal balance equal to at least 51% of the aggregate Loans then outstanding. "Restricted Payment": as to any Person, any dividend or other distribution by such Person (whether in cash, securities or other property) with respect to any shares of any class of equity securities or beneficial interests of such Person, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such shares or beneficial interests or any option, warrant or other right to acquire any such shares or beneficial interests. "Revolving Credit Loan" and "Revolving Credit Loans": as defined in Section 2.1. "Revolving Credit Expiration Date": the earlier of the Maturity Date with respect to the Revolving Credit Loans which are not Competitive Bid Advances, or the Revolving Credit Termination Date. "Revolving Credit Termination Date": November 17, 2002 "Senior Debt Rating": the senior unsecured non-credit-enhanced debt rating of the Borrower as determined by S&P and/or Moody's from time to time. "Special Counsel": Emmet, Marvin & Martin, LLP, special counsel to BNY. "S&P": Standard & Poor's Ratings Group. "Stock": any and all shares, rights, interests, participations, warrants, depositary receipts or other equivalents (however designated) of corporate stock, including, without limitation, so-called "phantom stock," preferred stock and common stock. "Subsidiary": as to any Person, any corporation, association, partnership, limited liability company, joint venture or other business entity of which such Person, directly or indirectly, either (i) in respect of a corporation, owns or controls more than 50% of the outstanding Stock having ordinary voting power to elect a majority of the board of directors or similar managing body, irrespective of whether a class or classes shall or might have voting power by reason of the happening of any contingency, or (ii) in respect of an association, partnership, limited liability company, joint venture or other business entity, is entitled to share, either directly or indirectly through an entity described in clause (i) above, in more than 50% of the profits and losses, however determined. - 22 - 29 "Subsidiary Guarantor" means the Subsidiaries of the Borrower listed on Schedule 4.4 and designated thereof as a Subsidiary Guarantor, each Required Additional Guarantor, and their successors and assigns; and "Subsidiary Guarantors" shall mean all such guarantors, collectively. "Swingline Borrowing Request": a borrowing request in the form of Exhibit G. "Swingline Commitment" means, with respect to the Swingline Lender, the commitment of the Swingline Lender to make Swingline Loans hereunder, provided that the outstanding amount of Swingline Loans shall not at any time exceed the Swingline Sublimit. "Swingline Exposure": at any time, the aggregate principal amount of all Swingline Loans advanced pursuant to Section 2.8 outstanding at such time. The Swingline Exposure of each Lender at any time shall be its pro rata percentage thereof based on its Commitment Percentage of the total of such Swingline Loans at such time. "Swingline Lender" means BNY in its capacity as lender of Swingline Loans hereunder. "Swingline Loan": a Revolving Credit Loan made by the Swingline Lender pursuant to Section 2.8. "Swingline Note": as defined in Section 2.8(b). "Swingline Rate" means, with respect to each Swingline Loan, the rate per annum proposed by the Borrower with respect to any requested Swingline Loan and agreed to by the Swingline Lender in accordance with Section 2.8(c) as the interest rate applicable to such Swingline Loan. "Swingline Sublimit": $25,000,000.00. "Tangible Net Worth": as of any date of determination thereof with respect to the Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, the remainder of (i) the amounts which would, in conformity with GAAP, be included under "shareholder's equity" (or any like caption) on a Consolidated balance sheet of the Borrower and its Subsidiaries as at such date, minus (ii) the net book value of all assets of the Borrower and its Subsidiaries on a Consolidated basis (to the extent reflected in the Consolidated balance sheet of the Borrower at such date) which would be treated as intangibles under GAAP, including, without limitation, goodwill (whether representing the excess cost over book value of assets acquired or otherwise), patents, trademarks, trade names, franchises, copyrights, licenses, service marks, rights with respect to the foregoing and deferred charges (including, without - 23 - 30 limitation, unamortized debt discount and expense, organization costs and research and development costs). "Taxes": any present or future income, stamp or other taxes, levies, imposts, duties, fees, assessments, deductions, withholdings, or other charges of whatever nature, now or hereafter imposed, levied, collected, withheld, or assessed by any Governmental Authority. "Total Capital": on any date, the sum of, without duplication, (i) all Indebtedness of the Borrower and its Subsidiaries on such date which, in accordance with GAAP, is considered long term debt of the Borrower and its Subsidiaries, (ii) the amounts which would, in conformity with GAAP, be included under "shareholder's equity" (or any like caption) on a Consolidated balance sheet of the Borrower and its Subsidiaries as at such date, (iii) the value of all issued and outstanding preferred stock of the Borrower as set forth on the balance sheet of the Borrower as at such date, and (iv) all Loans outstanding on such date. "Total Commitment Amount": on any day during the Commitment Period, the sum of the Commitment Amounts of all Lenders on such day. "Unencumbered Asset": Any Operating Property which at any time (i) is wholly owned in fee simple by the Borrower, a wholly owned Subsidiary of the Borrower or a DownREIT Partnership (or is the subject of a Ground Lease), (ii) is free and clear of all Liens (other than Liens permitted under clauses (i), (ii), (iii), (iv), (v) (vi), (viii) and (ix) of Section 8.1), (iii) does not have applicable to it (or to any such Ground Lease) any restriction on the pledge, transfer, mortgage or assignment of such Operating Property or Ground Lease (including any restriction imposed by the organizational documents of any such Subsidiary or DownREIT Partnership), (iv) if owned by any such Subsidiary or DownREIT Partnership, the Stock, partnership interests or membership interests, as the case may be, of such Subsidiary or DownREIT Partnership that are owned by the Borrower or any Subsidiary are not subject to any pledge or security interest in favor of any Person other than the Borrower or a Subsidiary Guarantor, (v) is not an Environmental Risk Property; (vi) does not have, to the best of the Borrower's knowledge, any title, survey, environmental or other defect which could reasonably be expected to materially and adversely affect the value, use or marketability thereof, and (vii) is located within the contiguous 48 states of the continental United States; and "Unencumbered Assets" mean all such Unencumbered Assets, collectively. "Unencumbered Assets Coverage Ratio": on any date of determination the ratio of (i) the sum of all Adjusted Net Operating Income for all Unencumbered Assets of the Borrower and its Subsidiaries on a Consolidated basis, plus the Borrower's Interest in all Adjusted Net Operating Income for all Unencumbered Assets owned by a DownREIT Partnership, in each case for the fiscal quarter most recently then ending, to (ii) the - 24 - 31 portion of the Consolidated Interest Expense consisting of interest on all unsecured Indebtedness of the Borrower and its Subsidiaries as of such fiscal quarter end. "Unencumbered Asset Value": as of any date the quotient of (i) an amount equal to the Adjusted Net Operating Income for all Unencumbered Assets in the aggregate for the four fiscal quarters of the Borrower most recently ending as of such date, divided by (ii) 10%. For purposes of any determination of Unencumbered Asset Value, the following limitations and methodology shall apply: (A) the Adjusted Net Operating Income of any Unencumbered Asset owned by a DownREIT Partnership shall be based on the Borrower's Interest in the Adjusted Net Operating Income for each such Unencumbered Asset for the four fiscal quarters having ended as of such date; (B) in the event more than 10% of the gross base rents payable under all leases for Properties of the Borrower, its Subsidiaries or a DownREIT Partnership (including the Borrower's Interest in any Property) shall be payable by one tenant and its Subsidiaries, then Unencumbered Asset Value shall be reduced by the percentage amount of such excess multiplied by the Unencumbered Asset Value attributable to the Properties leased or controlled by such tenant and its Subsidiaries, and (C) in the event that the Borrower or a Subsidiary of the Borrower shall not have owned an Unencumbered Asset for the entire previous four fiscal quarters, then for the purposes of determining the Unencumbered Asset Value with respect to such Unencumbered Asset, the Adjusted Net Operating Income for such Unencumbered Asset shall be annualized in a manner reasonably satisfactory to the Administrative Agent. 1.2. Other Definitional Provisions. (a) All terms defined in this Agreement shall have the meanings given such terms herein when used in the Loan Documents or any certificate, opinion or other document made or delivered pursuant hereto or thereto, unless otherwise defined therein. (b) As used in the Loan Documents and in any certificate, opinion or other document made or delivered pursuant hereto or thereto, accounting terms not defined in Section 1.1, and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP. (c) The words "hereof", "herein", "hereto" and "hereunder" and similar words when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, schedule and exhibit references contained herein shall refer to Sections hereof or schedules or exhibits hereto unless otherwise expressly provided herein. (d) The word "or" shall not be exclusive; "may not" is prohibitive and not permissive. - 25 - 32 (e) Unless the context otherwise requires, words in the singular number include the plural, and words in the plural include the singular. (f) Unless specifically provided in a Loan Document to the contrary, references to time shall refer to New York City time. 2. AMOUNT AND TERMS OF LOANS AND LETTERS OF CREDIT. 2.1. Revolving Credit Loans. Subject to the terms and conditions hereof, each Lender severally agrees to make revolving credit loans (each a "Revolving Credit Loan" and, as the context may require, collectively with all Revolving Credit Loans of such Lender and with the Revolving Credit Loans of all other Lenders, the "Revolving Credit Loans") to the Borrower from time to time during the Commitment Period, in an aggregate principal amount such that at any one time the Facility Exposure of such Lender (exclusive of any Competitive Bid Advances of such Lender at such time) shall not exceed such Lender's Commitment Amount. At no time shall the sum of (i) the aggregate outstanding principal amount of the Revolving Credit Loans of all Lenders, (ii) all Lenders' LC Exposure and (iii) all Lenders' Swingline Exposure, exceed the Total Commitment Amount. During the Commitment Period, the Borrower may borrow, prepay in whole or in part and reborrow under the Commitments, all in accordance with the terms and conditions of this Agreement. Subject to the provisions of Sections 2.3, 2.4 and 2.10, Revolving Credit Loans (other than Swingline Loans) may be (a) ABR Advances, (b) Eurodollar Advances, (c) Competitive Bid Advances or (d) any combination thereof. Each Swingline Loan shall accrue interest at the Swingline Rate applicable thereto in accordance with Section 2.11(a). 2.2. Facility Notes. (a) Facility Notes. The Revolving Credit Loans of each Lender made as Conventional Advances and the LC Exposure and the Swingline Exposure (other than the Swingline Lender's Swingline Exposure which is evidenced by the Swingline Note) of each Lender shall be evidenced by a promissory note of the Borrower, substantially in the form of Exhibit H, with appropriate insertions therein as to date and principal amount (each, as endorsed or modified from time to time, a "Facility Note" and, collectively with the Facility Notes of all other Lenders, the "Facility Notes"), payable to the order of such Lender for the account of its Applicable Lending Office and representing the obligation of the Borrower to pay the lesser of (a) the original amount of the Commitment of such Lender and (b) the aggregate unpaid principal balance of all Revolving Credit Loans of such Lender made as Conventional Advances and such Lender's share of the LC Disbursements and Swingline Exposure, plus interest and other amounts owing to the Lenders under the Loan Documents. - 26 - 33 (b) The Facility Notes Generally. Each Facility Note shall bear interest from the date thereof on the unpaid principal balance thereof at the applicable interest rate or rates per annum determined as provided in Section 2.11 and shall be stated to mature on the Maturity Date. The following information shall be recorded by each Lender on its books and, prior to any transfer of any such Notes, endorsed by such Lender on the schedule attached thereto or any continuation thereof: (i) the date and amount of each Revolving Credit Loan of such Lender made as a Conventional Advance; (ii) its character as an ABR Advance, a Eurodollar Advance or a combination thereof; (iii) the interest rate and Interest Period applicable to Eurodollar Advances; and (iv) each payment and prepayment of the principal thereof; provided that the failure of such Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower to make payment when due of any amount owing under the Loan Documents. 2.3. Procedure for Revolving Credit Loan Borrowings Other than Swingline Borrowings and Competitive Bid Borrowings. (a) Revolving Credit Loans. Except for Revolving Credit Loans which the Borrower has requested be made as Competitive Bid Advances or which are Swingline Loans (as to which the provisions of Sections 2.4 or 2.8, respectively, shall apply), and subject to the limitations set forth in Section 2.1 and 2.3(c), the Borrower may borrow under the Commitments on any Business Day during the Commitment Period by providing notice thereof in accordance with Section 2.3(b). (b) Borrowing Requests. To request Revolving Credit Loans pursuant to Section 2.3(a), the Borrower shall notify the Administrative Agent of such request by telephone (a) in the case of a Eurodollar Advance, not later than 12:00 P.M., New York City time, two Business Days before the date of the proposed borrowing of Revolving Credit Loans or (b) in the case of an ABR Advance, not later than 12:00 P.M., New York City time, one Business Day before the date of such proposed advance. Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Borrowing Request signed by the Borrower. Each such telephonic and written Borrowing Request shall specify the following information: (i) the aggregate amount of the requested borrowing of Revolving Credit Loans; (ii) the date of such borrowing of Revolving Credit Loans, which shall be a Business Day; (iii) whether the requested Revolving Credit Loan is to be an ABR Advance or a Eurodollar Advance; (iv) in the case of a Eurodollar Advance, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term "Interest Period"; and (v) the location and number of the Borrower's account to which funds are to be disbursed, which shall comply with the requirements of Section 2.3(d). - 27 - 34 (c) Limits on Advances. Each borrowing of (i) ABR Advances shall be in a minimum aggregate principal amount equal to $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the Available Commitment Amount, and (ii) Eurodollar Advances shall be in an aggregate principal amount equal to $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the Available Commitment Amount. (d) Funding of Revolving Credit Loans. Upon receipt of each notice of borrowing from the Borrower, the Administrative Agent shall promptly notify each Lender of the contents thereof. Subject to its receipt of the notice referred to in the preceding sentence, each Lender will make the amount of its Commitment Percentage of each borrowing of Revolving Credit Loans pursuant to this Section available to the Administrative Agent for the account of the Borrower at the office of the Administrative Agent set forth in Section 11.2 not later than 12:30 P.M. on the relevant Borrowing Date requested by the Borrower in funds immediately available to the Administrative Agent at such office. The amounts so made available to the Administrative Agent on the Borrowing Date will then, subject to the satisfaction of the terms and conditions of this Agreement, as determined by the Administrative Agent, be made available on such date to the Borrower by the Administrative Agent at the office of the Administrative Agent specified in Section 11.2 by crediting the account of the Borrower on the books of such office with the aggregate of said amounts received by the Administrative Agent, provided that Revolving Credit Loans made to finance the reimbursement of an LC Disbursement as provided in Section 2.9 shall be remitted by the Administrative Agent to the Issuing Bank. (e) Effect of Incomplete Borrowing Request. If no election is made as to the whether the Revolving Credit Loans shall be ABR Advances or Eurodollar Advances, then the requested Revolving Credit Loans shall be an ABR Advance. If no Interest Period is specified with respect to any requested borrowing of Eurodollar Advances, then the Borrower shall be deemed to have selected an Interest Period of one month's duration. (f) Administrative Agent's Assumption. Unless the Administrative Agent shall have received prior notice from a Lender (by telephone or otherwise, such notice to be promptly confirmed by telecopy or other writing) that such Lender will not make available to the Administrative Agent such Lender's pro rata share of the Revolving Credit Loans requested by the Borrower, the Administrative Agent may assume that such Lender has made such share available to the Administrative Agent on the Borrowing Date in accordance with this Section, provided that such Lender received notice of the proposed borrowing from the Administrative Agent, and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on the Borrowing Date a corresponding amount. If and to the extent such Lender shall not have so made such pro rata share available to the Administrative Agent, such Lender and the - 28 - 35 Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount (to the extent not previously paid by the other), together with interest thereon for each day from the date such amount is made available to the Borrower until the date such amount is paid to the Administrative Agent, at a rate per annum equal to, in the case of the Borrower, the applicable interest rate set forth in Section 2.11 for ABR Advances or Eurodollar Advances, as set forth in the applicable Conventional Borrowing Request, and, in the case of such Lender, the Federal Funds Rate in effect on each such day (as determined by the Administrative Agent). Such payment by the Borrower, however, shall be without prejudice to its rights against such Lender. If such Lender shall pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender's Revolving Credit Loan as part of the Revolving Credit Loans for purposes of this Agreement, which Revolving Credit Loan shall be deemed to have been made by such Lender on the Borrowing Date applicable to such Revolving Credit Loans, but without prejudice to the Borrower's rights against such Lender. 2.4. Competitive Bid Borrowings and Procedure for Competitive Bid Borrowings. (a) Competitive Bid Borrowings. Subject to the terms and conditions of this Agreement, each Lender severally agrees that during any Rated Period, the Borrower may effect Competitive Bid Borrowings under this Section 2.4 from time to time on any Business Day during the Commitment Period in the manner set forth below, provided, however, that the principal balance of all Competitive Bid Advances outstanding hereunder shall not at any time exceed the lesser of (x) the Competitive Bid Ceiling, and (y) the Total Commitment Amount less the sum of (A) the outstanding principal balance of all Conventional Advances, (B) the LC Exposure, and (C) the Swingline Exposure. (b) Procedure for Competitive Bid Borrowings. The Borrower may request a Competitive Bid Borrowing under this Section 2.4 during the Commitment Period, by giving to the Administrative Agent, not later than 12:00 P.M. at least three Business Days prior to the date of the proposed Competitive Bid Borrowing, a Competitive Bid Borrowing Request in the form of Exhibit C, specifying (i) the proposed date of the Competitive Bid Borrowing, (ii) the aggregate amount of the proposed Competitive Bid Borrowing (which amount shall not be less than $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof), (iii) the proposed Interest Period for the Competitive Bid Advances to be made as part of such Competitive Bid Borrowing (which Interest Period shall end not later than 5 days prior to the Revolving Credit Termination Date, and shall otherwise comply with the applicable provisions of the definition of "Interest Period"), and (iv) such other terms to be applicable to such Competitive Bid Borrowing as the Borrower may specify. The Administrative Agent shall promptly notify (by telephone or otherwise, to be promptly confirmed by telecopy - 29 - 36 or other writing) each Lender of each Competitive Bid Borrowing Request received by it and the terms contained in such Competitive Bid Borrowing Request. Such notice shall not be delivered separately to any Designated Lender, but shall be deemed delivered to a Designated Lender when delivered to the Designating Lender responsible for having appointed such Designated Lender as its Designated Lender. (c) Decision of Lenders to make Competitive Bid Advances. Each Lender may, if, in its sole discretion, it elects so to do, irrevocably offer to make one or more Revolving Credit Loans as Competitive Bid Advances to the Borrower as part of such proposed Competitive Bid Borrowing at a rate or rates of interest specified by such Lender in its sole discretion, by notifying (by telephone or otherwise, to be promptly confirmed by telecopy or other writing) the Administrative Agent, before 12:00 P.M. two Business Days before the Borrowing Date of such proposed Competitive Bid Borrowing of (i) the minimum amount and maximum amount of each Competitive Bid Advance which such Lender would be willing to make as part of such proposed Competitive Bid Borrowing (which amounts may, subject to the proviso to the first sentence of Section 2.4(a), exceed such Lender's Commitment), and (ii) the rate or rates of interest therefor and such Lender's Applicable Lending Office with respect to such Competitive Bid Advance, provided that any such offer made by a Designated Lender shall be made solely through the Designating Lender responsible for having appointed such Designated Lender as its Designated Lender. No Lender shall be required to specify in its Competitive Bid Advance offer whether such Competitive Bid Advance will be funded by its Designated Lender. The Administrative Agent shall notify the Borrower of all such offers before 12:30 P.M. two Business Days before such proposed Borrowing Date, provided that if BNY in its capacity as a Lender shall in its sole discretion elect to make any such offer, it shall notify the Borrower of such offer before 11:30 A.M. two Business Days before such proposed Borrowing Date. If any Lender other than BNY shall fail to notify the Administrative Agent before 12:00 P.M., and if BNY in its capacity as a Lender shall fail to notify the Borrower before 11:30 A.M. two Business Days before the proposed Borrowing Date, that it elects to make such an offer, such Lender shall be deemed to have elected not to make such an offer and such Lender shall not be obligated to, and shall not, make any Competitive Bid Advance as part of such Competitive Bid Borrowing. Any offer submitted after the time required above shall be disregarded by the Administrative Agent unless such offer is submitted to correct a manifest error in a prior offer. (d) Borrower's Acceptance or Cancellation. The Borrower shall, before 1:00 P.M. two Business Days before the date of such proposed Competitive Bid Borrowing, either (i) cancel such Competitive Bid Borrowing Request by notice to the Administrative Agent to that effect, or - 30 - 37 (ii) in its sole discretion, irrevocably accept one or more of the offers made by a Lender or Lenders pursuant to paragraph (c) above in ascending order of the rates offered therefor, by giving notice to the Administrative Agent of the amount of each Competitive Bid Advance (which amount shall be equal to or greater than the minimum amount, and equal to or less than the maximum amount, notified to the Borrower by the Administrative Agent on behalf of such Lender for such Competitive Bid Advance pursuant to paragraph (c)) to be made by each Lender as part of such Competitive Bid Borrowing, and reject any remaining offers made by Lenders pursuant to paragraph (c) above, by giving the Administrative Agent notice to that effect, provided, however, that the aggregate amount of such offers accepted by the Borrower shall be equal at least to $5,000,000. If offers for Competitive Bid Advances at the same interest rate are made by two or more Lenders pursuant to paragraph (c) above for a greater aggregate minimum principal amount than the amount in respect of which offers for Competitive Bid Advances are accepted by the Borrower at such interest rate, the principal amount of Competitive Bid Advances accepted at such interest rate shall be allocated by the Borrower among such Lenders as nearly as possible in proportion to the respective minimum principal amounts offered by such Lenders. No such Lender shall be obligated to make such Competitive Bid Advance in a principal amount less than the minimum amount offered by such Lender without consenting to such lesser amount. If any Lender declines to make a Competitive Bid Advance at such lesser amount, the Borrower shall be entitled in its sole discretion to determine which of such offers at the same interest rate it shall accept. If the Borrower notifies the Administrative Agent that a Competitive Bid Borrowing Request is cancelled pursuant to paragraph (d)(i) above, the Administrative Agent shall give prompt notice (by telephone or otherwise, to be promptly confirmed by telecopy or other writing) thereof to the Lenders and such Competitive Bid Borrowing shall not be made. If the Borrower accepts one or more of the offers made by any Lender or Lenders pursuant to paragraph (d)(ii) above, the Administrative Agent shall, as promptly as practicable on the second Business Day before such proposed Borrowing Date, notify (A) each Lender that has made an offer as described in paragraph (c) above, of the date and aggregate amount of such Competitive Bid Borrowing and whether any offer or offers made by such Lender pursuant to paragraph (c) above have been accepted by the Borrower and (B) each Lender whose offer to make a Competitive Bid Advance as part of such Competitive Bid Borrowing (a "Participating Lender") of the amount of each Loan to be made by such Lender as part of such Competitive Bid Borrowing has been accepted by the Borrower, together with a specification of the interest rate and Interest Payment - 31 - 38 Date or Dates in respect of each such Competitive Bid Advance. Each such Participating Lender shall, before 11:30 A.M. on the date of such Competitive Bid Borrowing make available, or cause its Designated Lender, if any, to make available, for the account of its Applicable Lending Office to the Administrative Agent at its address specified in Section 11.2 such Lender's portion of such Competitive Bid Borrowing, in funds immediately available to the Administrative Agent at such office. Competitive Bid Borrowings may be funded by a Lender's Designated Lender as provided in Section 11.8, however, the Designating Lender of such Designated Lender shall be responsible for making such Competitive Bid Advance should such Designated Lender fail to do so. Upon satisfaction of the applicable terms and conditions of this Agreement and after receipt by the Administrative Agent of such amount from each such Participating Lender, the Administrative Agent will make such amount available on such date to the Borrower at the office of the Administrative Agent specified in Section 11.2 by crediting the account of the Borrower on the books of such office with the aggregate of such amounts, in like funds as received by the Administrative Agent. After each Competitive Bid Borrowing, if requested by any Lender, the Administrative Agent shall within a reasonable time furnish to such Lender such information in respect of such Competitive Bid Borrowing as such Lender shall reasonably request. Unless the Administrative Agent shall have received prior notice from a Participating Lender (by telephone or otherwise, such notice to be promptly confirmed by telecopy or other writing) that such Participating Lender will not make available such Participating Lender's Competitive Bid Advance, the Administrative Agent may assume that such Participating Lender has made such Participating Lender's portion of such Competitive Bid Borrowing available to the Administrative Agent on such Borrowing Date in accordance with this Section, and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such Borrowing Date a corresponding amount. If and to the extent such Participating Lender shall not have made such portion available to the Administrative Agent, such Participating Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon for each day from the date such amount is made available to the Borrower until the date such amount is paid to the Administrative Agent at a rate per annum equal to, in the case of the Borrower, the rate of interest for such Competitive Bid Advance accepted by the Borrower in its notice to the Administrative Agent under Section 2.4(d)(ii), and, in the case of such Lender, the Federal Funds Rate in effect on such day (as determined by the Administrative Agent). Such payment by the Borrower, however, shall be without prejudice to its rights against such Participating Lender. If such Participating Lender shall pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender's Competitive Bid Advance as a part of such Competitive Bid Advances for - 32 - 39 purposes of this Agreement, which Competitive Bid Advance shall be deemed to have been made by such Participating Lender on the Borrowing Date applicable thereto, but without prejudice to the Borrower's rights against such Participating Lender. Notwithstanding its appointment of a Designated Lender, no Lender which is a Designating Lender shall be relieved of its obligation to fund a Competitive Bid Advance, and no Designated Lender shall be deemed to assume such obligation, prior to the time such Competitive Bid Advance is funded. (e) Subsequent Competitive Bid Borrowings Permitted. Within the limits and on the conditions set forth in this Section 2.4, the Borrower may from time to time borrow under this Section 2.4, repay pursuant to paragraph (f) below, and reborrow under this Section 2.4. (f) Repayment of Competitive Bid Borrowings. The Borrower shall repay to the Administrative Agent for the account of each Participating Lender which has made a Competitive Bid Advance on the last day of the Interest Period for such Competitive Bid Advance (such Interest Period being that specified by the Borrower in the related Competitive Bid Borrowing Request delivered pursuant to Section 2.4(b) above) the then unpaid principal amount of such Competitive Bid Advance. (g) Interest on Competitive Bid Borrowings. The Borrower shall pay interest on the unpaid principal balance of each Competitive Bid Advance from the date of such Competitive Bid Advance to the date the principal amount of such Competitive Bid Advance is repaid in full, at the rate of interest for such Competitive Bid Advance specified by the Participating Lender making (or whose Designated Lender made) such Competitive Bid Advance in such Participating Lender's notice with respect thereto delivered pursuant to Section 2.4(c) above payable on the Interest Payment Date specified by the Borrower for such Competitive Bid Advance in the related Competitive Bid Borrowing Request delivered pursuant to Section 2.4(b) above. Any Designated Lender which funds a Competitive Bid Advance shall on and after the time of such funding become the obligee under such Competitive Bid Advance. (h) Competitive Bid Notes. At the request of any Lender, the Borrower will deliver to such Lender a note, in the form mutually agreeable to such Lender and the Borrower, evidencing the obligation of the Borrower to pay the Competitive Bid Advances of such Lender, and interest thereon, in accordance with Section 2.4(f). (i) In General. Each Competitive Bid Advance shall be subject to all of the provisions of this Agreement generally, provided, however, that a Competitive Bid - 33 - 40 Advance shall not reduce a Lender's obligation to fund its Commitment Percentage of any ABR Advance or Eurodollar Advance. 2.5. Termination or Reduction of Commitments. (a) Voluntary Reductions. The Borrower shall have the right, upon at least three Business Days' prior written notice to the Administrative Agent, at any time to terminate the Commitments or from time to time to permanently reduce the Commitments, provided that the total of the Commitments shall not be reduced below an amount equal to the sum of (i) the aggregate principal balance of the Revolving Credit Loans then outstanding thereunder, (ii) the then current LC Exposure and (iii) the then current Swingline Exposure (in each case after giving effect to any contemporaneous prepayment of Loans), and provided further that any such reduction of the Commitments shall be in the minimum amount of $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. In the event that the total of the Commitments are reduced below the Swingline Sublimit, the Swingline Sublimit shall be deemed reduced to an amount equal to the total of the Commitments, as reduced. (b) In General. Reductions of the Commitments shall be applied pro rata according to the Commitments of each Lender, as the case may be. Simultaneously with each reduction of the Commitments under this Section, the Borrower shall pay the Facility Fee accrued (but not yet paid) on the amount by which the Commitments have been reduced and prepay the Loans outstanding thereunder by the amount, if any, by which the aggregate unpaid principal balance of such Loans exceeds the amount of the Commitments, as so reduced. If any prepayment is made under this Section with respect to any Fixed Rate Advances, in whole or in part, prior to the last day of the applicable Interest Period, the Borrower agrees to indemnify the Lenders in accordance with Section 2.16. No reduction or termination of the Commitments or the Swingline Sublimit may be reinstated. 2.6. Repayment of Loans; Evidence of Debt (a) Promise to Pay. The Borrower hereby unconditionally promises to pay (i) to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Revolving Credit Loan on the Maturity Date, and (ii) to the Swingline Lender the then unpaid principal amount of each Swingline Loan on the earlier of (A) the last day of the Interest Period applicable to such Swingline Loan and (B) the Maturity Date, subject to the provisions of Section 2.8(d). Competitive Bid Borrowings and LC Disbursements shall be paid pursuant to Sections 2.4 and 2.9, respectively. (b) Lenders' Accounts. Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the debt of the Borrower to - 34 - 41 such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder. (c) Administrative Agent's Accounts. The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Revolving Credit Loan, Competitive Bid Borrowing, and LC Disbursement made hereunder, the type of Advance thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any other sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender's share thereof. (d) Swingline Lenders' Accounts. The Swingline Lender shall maintain accounts in which it shall record (i) the amount of each Swingline Loan made hereunder, the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to the Swingline Lender hereunder and (iii) the amount of any sum received by the Swingline Lender in respect of payments of the Swingline Loans and interest thereon. (e) Entries Made in Accounts. The entries made in the accounts maintained pursuant to paragraphs (b), (c) and (d) of this Section shall, to the extent not inconsistent with any entries made in any Note and absent manifest error, be prima facie evidence of the existence and amounts of the obligations recorded therein, provided that the failure of any Lender, the Swingline Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans or any LC Disbursement in accordance with the terms of this Agreement. (f) Loans Evidenced by Notes. The Loans and interest thereon shall at all times (including after assignment pursuant to Section 11.7) be represented by one or more Notes in like form payable to the order of the payee named therein and its registered assigns. 2.7. Prepayments of the Loans. (a) Voluntary Prepayments. The Borrower may, at its option, prepay the ABR Advances and Eurodollar Advances, in whole or in part, without premium or penalty (other than any indemnification amounts, as provided for in Section 2.16) at any time and from time to time by notifying the Administrative Agent in writing at least one Business Day prior to the proposed prepayment date in the case of Loans consisting of ABR Advances and at least three Business Days prior to the proposed prepayment date in the case of Loans consisting of Eurodollar Advances, specifying the Loans to be prepaid consisting of ABR Advances, Eurodollar Advances or a combination thereof, the amount to be prepaid and the date of prepayment. Such notice shall be irrevocable and the - 35 - 42 amount specified in such notice shall be due and payable on the date specified, together with accrued interest to the date of such payment on the amount prepaid. Upon receipt of such notice, the Administrative Agent shall promptly notify each Lender in respect thereof. Partial prepayments of ABR Advances and/or Eurodollar Advances shall be in an aggregate minimum principal amount of $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the outstanding principal balance thereof. After giving effect to any partial prepayment with respect to Eurodollar Advances which were made (whether as the result of a borrowing or a conversion) on the same date and which had the same Interest Period, the outstanding principal amount of such Eurodollar Advances shall be at least (subject to Section 2.3(c)) $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. Notwithstanding anything in this Agreement to the contrary, voluntary prepayments by the Borrower of Competitive Bid Advances or Swingline Loans are not permitted. (b) In General. If any prepayment is made in respect of any Fixed Rate Advance, in whole or in part, prior to the last day of the applicable Interest Period, the Borrower agrees to indemnify the Lenders in accordance with Section 2.16. 2.8. Swingline Loans (a) Conditions of Swingline Loans. Subject to the terms and conditions set forth herein, the Swingline Lender agrees to make Swingline Loans to the Borrower from time to time on any Business Day during the period from the Effective Date to the thirty-fifth Business Day preceding the Revolving Credit Expiration Date in an aggregate principal amount at any time outstanding that will not result in (i) the Swingline Exposure exceeding the Swingline Sublimit or (ii) the total Facility Exposure exceeding the Total Commitment Amount. Notwithstanding the foregoing, the Swingline Lender shall not be required to make a Swingline Loan if (i) prior thereto or simultaneously therewith the Borrower shall not have delivered a Borrowing Request in compliance with the provisions of Section 2.8(c), (ii) the Borrower does not accept the Swingline Rate proposed by the Swingline Lender with respect to such requested Swingline Loan, (iii) any Lender shall be in default of its obligations under this Agreement or (iv) any Lender shall have notified the Swingline Lender and the Borrower in writing at least one Business Day prior to the Borrowing Date with respect to such Swingline Loan, that the conditions set forth in Section 6 have not been satisfied and such conditions remain unsatisfied as of the requested time of the making such Swingline Loan. Each Swingline Loan shall be due and payable on the maturity thereof, provided that in no event shall such maturity be later than the fifth Business Day preceding the Revolving Credit Expiration Date. Swingline Loans shall constitute "Revolving Credit Loans" for all purposes hereunder, but shall not be considered the utilization of any Commitment of the Swingline Lender. - 36 - 43 (b) Swingline Note. The Swingline Loans shall be evidenced by a note (the "Swingline Note") in the form of Exhibit I in the amount of the Swingline Sublimit and shall bear interest from the date thereof on the unpaid principal balance thereof at the applicable interest rate or rates per annum determined as provided in Section 2.11 and shall be stated to mature on the Maturity Date. The following information shall be recorded by the Swingline Lender on its books: (i) the date and amount of each Swingline Loan, (ii) the interest rate and Interest Period applicable to such Swingline Loan, and (iii) each payment and prepayment of the principal thereof; provided that the failure of the Swingline Lender to make any such recordation shall not affect the obligations of the Borrower to make payment when due of any amount owing under the Loan Documents. (c) Swingline Loan Borrowing Request. To request a Swingline Loan, the Borrower shall notify the Administrative Agent and the Swingline Lender by telephone no later than 12:00 p.m., New York City time, on the day of the relevant Swingline Loan. Each such notice shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent and the Swingline Lender of a Borrowing Request, which shall specify (i) the aggregate principal amount to be borrowed, (ii) the requested Borrowing Date (which shall be a Business Day), and (iii) the requested Swingline Rate and the Interest Period for the requested Swingline Loan. Subject to its agreement with the Borrower on the applicable Swingline Rate, the Swingline Lender will make the requested amount available promptly on that same day, to the Administrative Agent (for the account of the Borrower), who, thereupon, will promptly make such amount available to the Borrower in like funds in the manner provided for in Section 2.3(d). Each Swingline Loan shall be in an aggregate amount that is an integral multiple of $100,000 and not less than $100,000. (d) Participation in Swingline Loans. The Swingline Lender may by written notice given to the Administrative Agent not later than 10:00 a.m., New York City time, on any Business Day require the Lenders to acquire participations on such Business Day in all or a portion of the Swingline Loans outstanding. Such notice shall specify the aggregate amount of Swingline Loans in which the Lenders will participate. Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Lender, specifying in such notice such Lender's Commitment Percentage of such Swingline Loan or Swingline Loans. Each Lender hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative Agent, for the account of the Swingline Lender, such Lender's Commitment Percentage of such Swingline Loan or Swingline Loans. Each Lender acknowledges and agrees that its obligation to acquire participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, - 37 - 44 withholding or reduction whatsoever. Each Lender shall comply with its obligation under this paragraph by wire transfer of immediately available funds, in the same manner as provided in Section 2.3(e) with respect to Loans made by such Lender (and Section 2.3(e) shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the Swingline Lender the amounts so received by it from the Lenders. The Administrative Agent shall notify the Borrower of any participations in any Swingline Loan acquired pursuant to this paragraph, and thereafter payments in respect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender. Any amounts received by the Swingline Lender from the Borrower (or other party on behalf of the Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative Agent; any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Lenders that shall have made their payments pursuant to this paragraph and to the Swingline Lender, as their interests may appear. The purchase of participations in a Swingline Loan pursuant to this paragraph shall not relieve the Borrower of any default in the payment thereof. 2.9. Letters of Credit. (a) General. Subject to the terms and conditions set forth herein, the Borrower may request the issuance of Letters of Credit denominated in Dollars for its own account, in a form reasonably acceptable to the Administrative Agent and the Issuing Bank, at any time and from time to time during the period from the Effective Date to the tenth Business Day prior to the Maturity Date with respect to Revolving Credit Loans made as Conventional Advances. In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Borrower to, or entered into by the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control. (b) Notice of Issuance; Amendment; Certain Conditions. To request the issuance of a Letter of Credit, the Borrower shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for doing so have been approved by the Issuing Bank) to the Issuing Bank and the Administrative Agent (reasonably in advance of the requested date of issuance) a notice requesting the issuance of a Letter of Credit and specifying the date of issuance (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the amount of such Letter of Credit, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare such Letter of Credit. If requested by the Issuing Bank, the Borrower shall, for informational purposes only, complete a letter of credit application on the Issuing Bank's standard form in connection with any request for a Letter of Credit. A Letter of Credit shall be issued only if (and, - 38 - 45 upon issuance, amendment, renewal or extension of each Letter of Credit, the Borrower shall be deemed to represent and warrant that), after giving effect to such issuance (i) the LC Exposure shall not exceed the LC Sublimit, and (ii) the total Facility Exposure shall not exceed the Total Commitment Amount. Any Letter of Credit issued may, at the request of the Borrower and with the consent of the Letter of Credit Issuer and the Administrative Agent, be amended, renewed or extended, provided that no Default then exists and that after giving effect thereto, such Letter of Credit (if the same had been issued at such time) would comply with all requirements of this Section. (c) Expiration Date. Each Letter of Credit must expire at or prior to the close of business on the earlier of (i) the date that is one year after the date of the issuance of such Letter of Credit and (ii) the date that is ten Business Days prior to the Revolving Credit Termination Date. (d) Participations. By the issuance of a Letter of Credit and without any further action on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby grants to each Lender, and each such Lender hereby acquires from the Issuing Bank, a participation in such Letter of Credit equal to such Lender's Commitment Percentage of the aggregate amount available to be drawn under such Letter of Credit. In consideration and in furtherance of the foregoing, each such Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Lender's Commitment Percentage of each LC Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section, or of any reimbursement payment required to be refunded to the Borrower for any reason. Each such Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or reduction or termination of any of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever; provided, however, that no Lender shall be obligated to make any payment to the Administrative Agent for any wrongful LC Disbursement made by the Issuing Bank as a result of acts or omissions constituting willful misconduct or gross negligence on the part of the Issuing Bank. (e) Reimbursement. If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such LC Disbursement by paying to the Administrative Agent an amount equal to such LC Disbursement not later than 1:00 p.m., New York City time, on the date that such LC Disbursement is made, if the Borrower shall have received notice of such LC Disbursement prior to 12:00 noon, New York City time, on such date, or if such notice has not been received by the Borrower prior to such time on such date, then not later than 1:00 p.m., New York City time, on (i) the Business Day that the Borrower receives such notice, if such notice is received prior to 12:00 noon, New York City time, on such day, - 39 - 46 or (ii) the Business Day immediately following the day that the Borrower receives such notice, if such notice is not received prior to such time on such day. If the Borrower fails to make such payment under this paragraph when due, the Administrative Agent shall notify each Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Lender's Commitment Percentage thereof. Promptly following receipt of such notice, each Lender shall pay to the Administrative Agent its Commitment Percentage of the payment then due from the Borrower, in the same manner as provided in Section 2.3 with respect to Conventional Advances made by such Lender (and Section 2.3 shall apply, mutatis mutandis, to the payment obligations of the Lenders), and the Administrative Agent shall promptly pay to the Issuing Bank the amounts so received by it from the Lenders. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph, the Administrative Agent shall distribute such payment to the Issuing Bank or, to the extent that Lenders have made payments pursuant to this paragraph to reimburse the Issuing Bank, then to such Lenders and the Issuing Bank as their interests may appear. Any payment made by a Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the funding of a Revolving Credit Loan as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement. (f) Obligations Absolute. The Borrower's obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein or herein, (ii) in the absence of the Issuing Bank's gross negligence or willful misconduct, any draft or other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii) in the absence of the Issuing Bank's gross negligence or willful misconduct, payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrower's obligations hereunder. The Lenders, the Administrative Agent and the Co-Documentation Agents shall not have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence - 40 - 47 arising from causes beyond the control of the Issuing Bank. The parties hereto expressly agree that, in the absence of gross negligence or willful misconduct on the part of the Issuing Bank (as finally determined by a court of competent jurisdiction), the Issuing Bank shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit. (g) Disbursement Procedures. The Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit. The Issuing Bank shall promptly notify the Administrative Agent and the Borrower by telephone (confirmed by telecopy) of such demand for payment and whether the Issuing Bank has made or will make an LC Disbursement thereunder; provided that any failure to give or delay in giving such notice shall not relieve the Borrower of its obligation to reimburse the Issuing Bank and the Lenders with respect to any such LC Disbursement. (h) Interim Interest. If the Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest, for each day from and including the date such LC Disbursement is made to but excluding the date that the Borrower reimburses such LC Disbursement, at the rate per annum then applicable to ABR Advances; provided that, if the Borrower fails to reimburse such LC Disbursement for more than two Business Days after the same is due pursuant to paragraph (e) of this Section, then interest shall accrue at the rate provided for in Section 2.11(b). Interest accrued pursuant to this paragraph shall be for the account of the Issuing Bank, except that interest accrued on and after the date of payment by any Lender pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be for the account of such Lender to the extent of such payment. (i) Cash Collateralization. If any Event of Default shall occur and be continuing, then on the Business Day that the Borrower receives notice from the Administrative Agent or the Required Lenders demanding the deposit of cash collateral pursuant to this paragraph, the Borrower shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the Lenders, an amount in cash equal to the LC Exposure with respect to Letters of Credit as of such date plus any accrued and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon - 41 - 48 the occurrence of any Event of Default with respect to the Borrower described in paragraphs (h) or (i) of Section 9. Such deposit shall be held by the Administrative Agent as collateral for the payment and performance of the obligations of the Borrower under this Agreement. The Administrative Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any interest earned on the investment of such deposit, which investments shall be in direct short-term obligations of, or short-term obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America, in each case maturing no later than the expiry date of the Letter of Credit giving rise to the relevant LC Exposure, such deposit shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such account shall be applied by the Administrative Agent to reimburse the Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity of the Loans has been accelerated, be applied to satisfy other obligations of the Borrower under this Agreement. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the Borrower within three Business Days after all Events of Default have been cured or waived. 2.10. Conversions. (a) Conversion Elections. The Borrower may elect from time to time to convert Eurodollar Advances to ABR Advances by giving the Administrative Agent at least one Business Day's prior irrevocable notice of such election, specifying the amount to be so converted, provided, that any such conversion of Eurodollar Advances shall only be made on the last day of the Interest Period applicable thereto. In addition, the Borrower may elect from time to time to convert ABR Advances to Eurodollar Advances or to convert Eurodollar Advances to new Eurodollar Advances by giving the Administrative Agent at least two Business Days' prior irrevocable notice of such election, specifying the amount to be so converted and the initial Interest Period relating thereto, provided that any such conversion of ABR Advances to Eurodollar Advances shall only be made on a Business Day and any such conversion of Eurodollar Advances to new Eurodollar Advances shall only be made on the last day of the Interest Period applicable to the Eurodollar Advances which are to be converted to such new Eurodollar Advances. Each such notice shall be in the form of Exhibit N and must be delivered to the Administrative Agent prior to 12:00 noon on the Business Day required by this Section for the delivery of such notices to the Administrative Agent. The Administrative Agent shall promptly provide the Lenders with notice of any such election. ABR Advances and Eurodollar Advances may be converted pursuant to this Section in whole or in part, provided that conversions of ABR Advances to Eurodollar - 42 - 49 Advances, or Eurodollar Advances to new Eurodollar Advances, shall be in an aggregate principal amount of $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. This Section shall not apply to Swingline Loans or Competitive Bid Borrowings, which may not be converted or continued beyond the Interest Period applicable thereto. (b) Effect on Conversions if an Event of Default. Notwithstanding anything in this Section to the contrary, no ABR Advance may be converted to a Eurodollar Advance, and no Eurodollar Advance may be converted to a new Eurodollar Advance, if a Default or Event of Default has occurred and is continuing either (i) at the time the Borrower shall notify the Administrative Agent of its election to convert or (ii) on the requested Conversion Date. In such event, such ABR Advance shall be automatically continued as an ABR Advance or such Eurodollar Advance shall be automatically converted to an ABR Advance on the last day of the Interest Period applicable to such Eurodollar Advance. If an Event of Default shall have occurred and be continuing, the Administrative Agent shall, at the request of the Required Lenders, notify the Borrower (by telephone or otherwise) that all, or such lesser amount as the Required Lenders shall designate, of the outstanding Eurodollar Advances shall be automatically converted to ABR Advances, in which event such Eurodollar Advances shall be automatically converted to ABR Advances on the date such notice is given. (c) Conversion not a Borrowing. Each conversion shall be effected by each Lender by applying the proceeds of its new ABR Advance or Eurodollar Advance, as the case may be, to its Advances (or portion thereof) being converted (it being understood that such conversion shall not constitute a borrowing for purposes of Sections 4, 5 or 6). 2.11. Interest Rate and Payment Dates. (a) Prior to Maturity. Except as otherwise provided in Section 2.11(b), prior to the Maturity Date, the Loans shall bear interest on the outstanding principal balance thereof at the applicable interest rate or rates per annum set forth below: - 43 - 50
ADVANCES RATE - -------- ---- Each ABR Advance Alternate Base Rate. Each Eurodollar Eurodollar Rate for the applicable Advance Interest Period plus the Applicable Margin. Competitive Bid The rate for the applicable Competitive Advance Bid Advance determined pursuant to Section 2.4. Swingline Loans The Swingline Rate applicable to each Swingline Loan, unless a participation is required to be made pursuant Section 2.8(d), in which case such Swingline Loan shall, from and after the date of such participation, bear interest at the Alternate Base Rate.
(b) Event of Default. After the occurrence and during the continuance of an Event of Default, the outstanding principal balance of the Loans and any overdue interest or other amount payable under the Loan Documents shall bear interest, whether before or after the entry of any judgment thereon, at a rate per annum equal to the Alternate Base Rate plus 2%. (c) Interest Payment Dates. Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan, provided that (i) interest accrued pursuant to paragraph (b) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Advance prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion. (d) General. Interest on (i) ABR Advances, to the extent based on the BNY Rate, shall be calculated on the basis of a 365 or 366-day year (as the case may be), and (ii) ABR Advances, to the extent based on the Federal Funds Rate, Eurodollar Advances, Competitive Bid Advances and Swingline Loans which accrue interest at the Swingline Rate shall be calculated on the basis of a 360-day year, in each case for the - 44 - 51 actual number of days elapsed, including the first day but excluding the last. Any change in the interest rate on the Loans resulting from a change in the Alternate Base Rate or a Pricing Level shall become effective as of the opening of business on the day on which such change shall become effective. The Administrative Agent shall, as soon as practicable, notify the Borrower and the Lenders of the effective date and the amount of each such change in the Alternate Base Rate or a Pricing Level, but any failure to so notify shall not in any manner affect the obligation of the Borrower to pay interest on the Loans in the amounts and on the dates required. Each determination of the Alternate Base Rate, a Eurodollar Rate or a Pricing Level by the Administrative Agent pursuant to this Agreement shall be conclusive and binding on the Borrower and the Lenders absent manifest error. At no time shall the interest rate payable on the Loans of any Lender (including the Swingline Lender), together with the Facility Fee and all other amounts payable under the Loan Documents, to the extent the same are construed to constitute interest, exceed the Highest Lawful Rate. If interest payable to a Lender (including the Swingline Lender) on any date would exceed the maximum amount permitted by the Highest Lawful Rate, such interest payment shall automatically be reduced to such maximum permitted amount, and interest for any subsequent period, to the extent less than the maximum amount permitted for such period by the Highest Lawful Rate, shall be increased by the unpaid amount of such reduction. Any interest actually received for any period in excess of such maximum allowable amount for such period shall be deemed to have been applied as a prepayment of the Loans. The Borrower acknowledges that to the extent interest payable on ABR Advances is based on the BNY Rate, the BNY Rate is only one of the bases for computing interest on loans made by the Lenders, and by basing interest payable on ABR Advances on the BNY Rate, the Lenders have not committed to charge, and the Borrower has not in any way bargained for, interest based on a lower or the lowest rate at which the Lenders may now or in the future make loans to other borrowers. 2.12. Substituted Interest Rate. In the event that (i) the Administrative Agent shall have reasonably determined (which determination shall be conclusive and binding upon the Borrower) that by reason of circumstances affecting the interbank eurodollar market either adequate and reasonable means do not exist for ascertaining the Eurodollar Rate applicable pursuant to Section 2.11 or (ii) the Required Lenders shall have notified the Administrative Agent that they have reasonably determined (which determination shall be conclusive and binding on the Borrower) that the applicable Eurodollar Rate will not adequately and fairly reflect the cost to such Lenders of maintaining or funding loans bearing interest based on such Eurodollar Rate, with respect to any portion of the Loans that the Borrower has requested be made as Eurodollar Advances or Eurodollar Advances that will result from the requested conversion of any portion of the Advances into Eurodollar Advances (each, an "Affected Advance"), the Administrative Agent shall - 45 - 52 promptly notify the Borrower and the Lenders (by telephone or otherwise, to be promptly confirmed in writing) of such determination, on or, to the extent practicable, prior to the requested Borrowing Date or Conversion Date for such Affected Advances. If the Administrative Agent shall give such notice, (a) any Affected Advances shall be made as ABR Advances, (b) the Advances (or any portion thereof) that were to have been converted to Affected Advances shall be converted to or continued as ABR Advances and (c) any outstanding Affected Advances shall be converted, on the last day of the then current Interest Period with respect thereto, to ABR Advances. Until any notice under clauses (i) or (ii), as the case may be, of this Section has been withdrawn by the Administrative Agent (by notice to the Borrower promptly upon either (x) the Administrative Agent having determined that such circumstances affecting the interbank eurodollar market no longer exist and that adequate and reasonable means do exist for determining the Eurodollar Rate pursuant to Section 2.11 or (y) the Administrative Agent having been notified by such Required Lenders that circumstances no longer render the Advances (or any portion thereof) Affected Advances), no further Eurodollar Advances shall be required to be made by the Lenders nor shall the Borrower have the right to convert all or any portion of the Loans to Eurodollar Advances. 2.13. Taxes; Net Payments. (a) All payments made by the Borrower or any Subsidiary Guarantor under the Loan Documents shall be made free and clear of, and without reduction for or on account of, any taxes, levies, imposts, deductions, charges or withholdings required by law to be withheld from any amounts payable under the Loan Documents. A statement setting forth the calculations of any amounts payable pursuant to this paragraph submitted by a Lender to the Borrower shall be conclusive absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. (b) Each Lender which is a foreign corporation within the meaning of Section 1442 of the Code shall deliver to the Borrower such certificates, documents or other evidence as the Borrower may reasonably require from time to time as are necessary to establish that such Lender is not subject to withholding under Section 1441 or 1442 of the Code or as may be necessary to establish, under any law hereafter imposing upon the Borrower, an obligation to withhold any portion of the payments made by the Borrower under the Loan Documents, that payments to the Administrative Agent on behalf of such Lender are not subject to withholding. 2.14. Illegality. Notwithstanding any other provisions herein, if any law, regulation, treaty or directive hereafter enacted, promulgated, approved or issued, or any change in any - 46 - 53 presently existing law, regulation, treaty or directive, or in the interpretation or application thereof, shall make it unlawful for any Lender to make or maintain its Eurodollar Advances as contemplated by this Agreement, such Lender shall so notify the Administrative Agent and the Administrative Agent shall forthwith give notice thereof to the other Lenders and the Borrower, whereupon (i) the commitment of such Lender hereunder to make Eurodollar Advances or convert ABR Advances to Eurodollar Advances shall forthwith be suspended and (ii) such Lender's Loans then outstanding as Eurodollar Advances affected hereby, if any, shall be converted automatically to ABR Advances on the last day of the then current Interest Period applicable thereto or within such earlier period as required by law. If the commitment of any Lender with respect to Eurodollar Advances is suspended pursuant to this Section and thereafter it is once again legal for such Lender to make or maintain Eurodollar Advances, such Lender's commitment to make or maintain Eurodollar Advances shall be reinstated and such Lender shall notify the Administrative Agent and the Borrower of such event. Notwithstanding the foregoing, to the extent that the conditions giving rise to the notice requirement set forth in this Section can be eliminated by the transfer of such Credit Party's Loans or Commitment to another of its branches, and to the extent that such transfer is not inconsistent with such Credit Party's internal policies of general application and only if, as determined by such Credit Party in its sole discretion, the transfer of such Loan or Commitment, as the case may be, would not otherwise adversely affect such Loans or such Credit Party, the Borrower may request, and such Lender shall use reasonable efforts to effect, such transfer. 2.15. Increased Costs. In the event that any law, regulation, treaty or directive hereafter enacted, promulgated, approved or issued or any change in any presently existing law, regulation, treaty or directive therein or in the interpretation or application thereof by any Governmental Authority charged with the administration thereof or compliance by any Credit Party (or any corporation directly or indirectly owning or controlling such Credit Party) with any request or directive, whether or not having the force of law, from any central bank or other Governmental Authority, agency or instrumentality: (a) does or shall subject any Credit Party to any Taxes of any kind whatsoever with respect to any Eurodollar Advances or any Letter of Credit or participation therein, or its obligations under this Agreement to make Eurodollar Advances, issue Letters of Credit or participate therein, or change the basis of taxation of payments to any Credit Party of principal, interest or any other amount payable hereunder in respect of its Eurodollar Advances or Letters of Credit or participation's therein, including any Taxes required to be withheld from any amounts payable under the Loan Documents (except for imposition of, or change in the rate of, tax on the overall net income of such Credit Party or its Applicable Lending Office for any of such Advances by the jurisdiction in which such Credit Party is incorporated or has its principal office or - 47 - 54 such Applicable Lending Office, including, in the case of Credit Parties incorporated in any State of the United States such tax imposed by the United States); or (b) does or shall impose, modify or make applicable any reserve, special deposit, compulsory loan, assessment, increased cost or similar requirement against assets held by, or deposits of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Credit Party in respect of its Eurodollar Advances, Letters of Credit or participations therein which, in the case of Eurodollar Advances, is not otherwise included in the determination of the Eurodollar Rate; and the result of any of the foregoing is to increase the cost to such Credit Party of making, issuing, renewing, converting or maintaining its Eurodollar Advances, Letters of Credit or participations therein, or its commitment to make such Eurodollar Advances, issue such Letters of Credit or participate therein, or to reduce any amount receivable hereunder in respect of its Eurodollar Advances, Letters of Credit or participations therein, then, in any such case, the Borrower shall pay such Credit Party, upon its demand, any additional amounts necessary to compensate such Credit Party for such additional cost or reduction in such amount receivable which such Credit Party deems to be material as determined by such Credit Party; provided, however, that nothing in this Section shall require the Borrower to indemnify the Credit Parties with respect to withholding Taxes for which the Borrower has no obligation under Section 2.13. No failure by any Credit Party to demand compensation for any increased cost during any Interest Period shall constitute a waiver of such Credit Party's right to demand such compensation at any time. A statement setting forth the calculations of any additional amounts payable pursuant to the foregoing sentence submitted by a Credit Party to the Borrower shall be conclusive absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and any of the Commitments or the payment of the Notes and all other amounts payable under the Loan Documents. Failure to demand compensation pursuant to this Section shall not constitute a waiver of such Credit Party's right to demand such compensation. To the extent that any increased costs of the type referred to in this Section are being incurred by a Credit Party and such costs can be eliminated or reduced by the transfer of such Credit Party's Loans or Commitment to another of its branches, and to the extent that such transfer is not inconsistent with such Credit Party's internal policies of general application and only if, as determined by such Credit Party in its sole discretion, the transfer of such Loan or Commitment, as the case may be, would not otherwise materially adversely affect such Loan or such Credit Party, the Borrower may request, and such Lender shall use reasonable efforts to effect, such transfer. - 48 - 55 2.16. Indemnification for Break Funding Losses. Notwithstanding anything contained herein to the contrary, if (i) the Borrower shall fail to borrow or convert on a Borrowing Date or Conversion Date after it shall have given notice to do so in which it shall have requested a Eurodollar Advance pursuant to Section 2.3 or 2.9, (ii) the Borrower shall fail to borrow after having accepted one or more offers of Competitive Bid Advances under Section 2.4, (iii) the Borrower shall fail to borrow after having requested a Swingline Loan pursuant to Section 2.8, (iv) a Eurodollar Advance, Competitive Bid Advance or Swingline Loan shall be terminated or prepaid for any reason prior to the last day of the Interest Period applicable thereto (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality), or (v) the Swingline Rate applicable to any Swingline Loan shall be converted to the Alternate Base Rate pursuant to Section 2.11(a) and, at the time of such conversion, an Event of Default exists, the Borrower agrees to indemnify each Credit Party against, and to pay on demand directly to such Credit Party, any loss or expense suffered by such Credit Party as a result of such failure to borrow or convert, or such termination or repayment, including, without limitation, an amount, if greater than zero, equal to: A x (B-C) x D --- 360 where: "A" equals such Credit Party's pro rata share of the Affected Principal Amount; "B" equals the applicable Eurodollar Rate, the rate which such Competitive Bid Advance bears to such Loan or the applicable Swingline Rate (in each case expressed as a decimal), as the case may be; "C" equals the applicable Eurodollar Rate or Proposed Bid Rate (in each case expressed as a decimal), as the case may be, in effect on or about the first day of the applicable Remaining Interest Period, based on the applicable rates offered or bid, as the case may be, on or about such date, for deposits (or in the case of a Proposed Bid Rate, based on the rate such Credit Party would have quoted) in an amount equal approximately to such Credit Party's pro rata share of the Affected Principal Amount with an Interest Period equal approximately to the applicable Remaining Interest Period, as determined by such Credit Party; - 49 - 56 "D" equals the number of days from and including the first day of the applicable Remaining Interest Period to but excluding the last day of such Remaining Interest Period; and any other out-of-pocket loss or expense (including any internal processing charge customarily charged by such Credit Party) suffered by such Credit Party in connection with such Eurodollar Advance, Competitive Bid Advance or Swingline Loan, including, without limitation, in liquidating or employing deposits acquired to fund or maintain the funding of its pro rata share of the Affected Principal Amount, or redeploying funds prepaid or repaid, in amounts which correspond to its pro rata share of the Affected Principal Amount. A statement setting forth the calculations of any amounts payable pursuant to this Section submitted by a Credit Party to the Borrower shall be conclusive and binding on the Borrower absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 2.17. Use of Proceeds. The proceeds of Loans and the Letters of Credit shall be used solely for general business purposes, and such use shall conform to the provisions of Section 4.11, provided that the first Loans hereunder shall be applied to pay in full any loans outstanding under the Existing Credit Agreements, together with all interest, fees, breakage costs and other amounts outstanding thereunder. 2.18. Capital Adequacy. If (i) after the date hereof, the enactment or promulgation of, or any change or phasing in of, any United States or foreign law or regulation or in the interpretation thereof by any Governmental Authority charged with the administration thereof, (ii) compliance with any directive or guideline from any central bank or United States or foreign Governmental Authority (whether or not having the force of law) promulgated or made after the date hereof, or (iii) compliance with the Risk-Based Capital Guidelines of the Board of Governors of the Federal Reserve System as set forth in 12 CFR Parts 208 and 225, or of the Comptroller of the Currency, Department of the Treasury, as set forth in 12 CFR Part 3, or similar legislation, rules, guidelines, directives or regulations under any applicable United States or foreign Governmental Authority affects or would affect the amount of capital required to be maintained by a Credit Party (or any lending office of such Credit Party) or any corporation directly or indirectly owning or controlling such Credit Party or imposes any restriction on or otherwise adversely affects such Credit Party (or any lending office of such Credit Party) or any corporation directly or indirectly owning or controlling such Credit Party and such Credit Party shall have reasonably determined that such enactment, promulgation, change or compliance has the effect of reducing the rate of return on such Credit Party's capital or - 50 - 57 the asset value to such Credit Party of any Loan made by such Credit Party as a consequence, directly or indirectly, of its obligations to make and maintain the funding of its Loans at a level below that which such Credit Party could have achieved but for such enactment, promulgation, change or compliance (after taking into account such Credit Party's policies regarding capital adequacy) by an amount deemed by such Credit Party to be material, then, upon demand by such Credit Party, the Borrower shall promptly pay to such Credit Party such additional amount or amounts as shall be sufficient to compensate such Credit Party for such reduction in such rate of return or asset value. A certificate in reasonable detail as to such amounts submitted to the Borrower and the Administrative Agent setting forth the determination of such amount or amounts that will compensate such Credit Party for such reductions shall be presumed correct absent manifest error. No failure by any Credit Party to demand compensation for such amounts hereunder shall constitute a waiver of such Credit Party's right to demand such compensation at any time. Such Credit Party shall, however, use reasonable efforts to notify the Borrower of such claim within 90 days after the officer of such Credit Party having primary responsibility for this Agreement has obtained knowledge of the events giving rise to such claim. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 2.19. Administrative Agent's Records. The Administrative Agent's records with respect to the Loans, the interest rates applicable thereto, each payment by the Borrower of principal and interest on the Loans, and fees, expenses and any other amounts due and payable in connection with this Agreement shall be presumptively correct absent manifest error as to the amount of the Loans, and the amount of principal and interest paid by the Borrower in respect of such Loans and as to the other information relating to the Loans, and amounts paid and payable by the Borrower hereunder and under the Notes. The Administrative Agent will when requested by the Borrower advise the Borrower of the principal and interest outstanding under the Loans as of the date of such request and the dates on which such payments are due. 3. FEES; PAYMENTS 3.1. Facility Fee. (a) The Borrower agrees to pay to the Administrative Agent, for the account of the Lenders in accordance with each Lender's Commitment Percentage, a fee (the "Facility Fee"), from the Effective Date through the Maturity Date for Revolving Credit Loans made as Conventional Advances, computed as follows: an amount, determined periodically as hereinafter set forth, equal to the product of (i) the Applicable - 51 - 58 Facility Fee Percentage times (ii) the average daily Total Commitment Amount during such period. The Facility Fee shall be payable quarterly in arrears on the last day of each March, June, September and December of each year, commencing on the first such day following the Effective Date, on any optional reduction of the Total Commitment Amount, and on the Maturity Date for Revolving Credit Loans made as Conventional Advances. The Facility Fee (and the Applicable Facility Fee Percentage) shall be calculated on the basis of a 360 day year for the actual number of days elapsed without regard to the amount of Loans outstanding during any period for which the Facility Fee is computed. (b) The Borrower agrees to pay (i) to the Administrative Agent for the account of each Lender a participation fee with respect to its participations in Letters of Credit, which shall accrue at rate per annum equal to the Applicable Margin on the average daily amount of such Lender's LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from and including the Effective Date but excluding the later of the date on which such Lender's Commitment terminates and the date on which such Lender ceases to have any LC Exposure and (ii) to the Issuing Bank, for its own account, the Issuing Bank's standard fronting fees with respect to the issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder. Accrued participation fees and fronting fees shall be payable in arrears on the last day of March, June, September and December of each year, commencing on the first such date to occur after the date hereof; provided that all such fees shall be payable on the date on which the Commitments terminate and any such fees accruing after the date on which the Commitments terminate shall be payable on demand. All other fees payable to the Issuing Bank pursuant to this paragraph shall also be payable on demand. All participation fees and fronting fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed. (c) The Borrower agrees to pay any other fees payable to any Credit Party under any separate agreement at the times so agreed upon in such separate agreements. (d) All fees and other amounts payable under paragraphs (a) and (b) of this Section shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution, in the case of the Facility Fee and participation fees described therein, and other fees and amounts payable under this Section shall be paid directly to the Credit Party to whom such fees and other amounts are payable. Fees and other amounts paid shall not be refundable under any circumstances. - 52 - 59 3.2. Payments; Application of Payments. Each payment, including each prepayment, of principal and interest on the Loans, LC Disbursements and the Facility Fee shall be made by the Borrower to the Administrative Agent, without set-off, deduction or counterclaim, at its office set forth in Section 11.2 in funds immediately available to the Administrative Agent at such office by 12:00 noon on the due date for such payment. Promptly upon receipt thereof by the Administrative Agent, the Administrative Agent shall remit, in like funds as received, (i) to the Lenders who maintain any of their Loans as ABR Advances or Eurodollar Advances, each such Lender's pro rata share of such payments which are in respect of principal or interest due on such ABR Advances or Eurodollar Advances, (ii) to the Lenders who maintain any of their Revolving Credit Loans as Competitive Bid Advances, each such Lender's pro rata share of such payments which are in respect of principal or interest due on such Competitive Bid Advances in accordance with Sections 2.4(c) and (d), (iii) to the Swingline Lender, each payment which is in respect of principal or interest due on any Swingline Loan and (iv) in the case of the Facility Fee, to all Lenders pro rata according to each Lender's Commitment Percentage thereof. The failure of the Borrower to make any such payment by such time shall not constitute a default hereunder, provided that such payment is made on such due date, but any such payment made after 12:00 noon on such due date shall be deemed to have been made on the next Business Day for the purpose of calculating interest on amounts outstanding on the Loans. If any payment hereunder or under the Notes shall be due and payable on a day which is not a Business Day, the due date thereof (except as otherwise provided in the definition of Interest Period) shall be extended to the next Business Day and (except with respect to payments in respect of the Facility Fee) interest shall be payable at the applicable rate specified herein during such extension. If any payment is made with respect to any Eurodollar Advance or Competitive Bid Advance prior to the last day of the applicable Interest Period, the Borrower shall indemnify each Lender in accordance with Section 2.16. 4. REPRESENTATIONS AND WARRANTIES In order to induce the Administrative Agent and the Lenders to enter into this Agreement and to make the Loans the Borrower makes the following representations and warranties to the Administrative Agent and each Lender: 4.1. Existence and Power. (a) The Borrower is a Maryland corporation duly organized and validly existing and in good standing under the laws of Maryland, has all requisite power and authority to own its Property and to carry on its business as now conducted, and is in good standing and authorized to do business in each jurisdiction in which the nature of - 53 - 60 the business conducted therein or the Property owned therein make such qualification necessary, except where such failure to qualify could not reasonably be expected to have a Material Adverse Effect. (b) Each Subsidiary of the Borrower (including each Subsidiary Guarantor) is a corporation, partnership, limited liability company, real estate investment trust or business trust, is validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to own its Property and to carry on its business as now conducted, and is in good standing and authorized to do business in each other jurisdiction in which the nature of the business conducted therein or the Property owned therein make such qualification necessary, except where such failure to qualify could not reasonably be expected to have a Material Adverse Effect. 4.2. Authority. The Borrower has full legal power and authority to enter into, execute, deliver and perform the terms of the Loan Documents to which it is a party and to make the borrowings contemplated thereby, to execute, deliver and carry out the terms of the Notes and to incur the obligations provided for herein and therein, all of which have been duly authorized by all proper and necessary corporate action. 4.3. Binding Agreement. (a) The Loan Documents to which the Borrower is a party constitute the valid and legally binding obligations of the Borrower, enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights generally. (b) The execution, delivery and performance by the Borrower of the Loan Documents to which it is a party does not violate the provisions of any applicable statute, law (including, without limitation, any applicable usury or similar law), rule or regulation of any Governmental Authority. 4.4. Subsidiaries; DownREIT Partnerships. As of the Effective Date, the Borrower has only the Subsidiaries set forth on Schedule 4.4. Schedule 4.4 sets forth the name of, and the ownership interest of the Borrower in, each Subsidiary of the Borrower and identifies each Subsidiary that is a Subsidiary Guarantor, in each case as of the Effective Date. The shares of each corporate Subsidiary of the Borrower that are owned by the Borrower are duly authorized, validly issued, fully paid and nonassessable and are owned free and clear of any Liens. The - 54 - 61 interest of the Borrower in each non-corporate Subsidiary is owned free and clear of any Liens (other than Liens applicable to a partner under the terms of any partnership agreement to secure the Borrower's obligation to make capital contributions or similar payments thereunder). As of the Effective Date, the only DownREIT Partnerships are Excel Realty Partners, L.P. and E.H. Properties, L.P. 4.5. Litigation. (a) There are no actions, suits or proceedings at law or in equity or by or before any Governmental Authority (whether or not purportedly on behalf of the Borrower or any Subsidiary of the Borrower) pending or, to the knowledge of the Borrower, threatened against the Borrower or any Subsidiary of the Borrower or any of their respective Properties or rights, which (i) if adversely determined, could reasonably be expected to have a Material Adverse Effect, (ii) call into question the validity or enforceability of any of the Loan Documents, or (iii) could reasonably be expected to result in the rescission, termination or cancellation of any franchise, right, license, permit or similar authorization held by the Borrower or any Subsidiary of the Borrower, which rescission, termination or cancellation could reasonably be expected to have a Material Adverse Effect. (b) As of the date hereof, Schedule 4.5 sets forth all actions, suits and proceedings at law or in equity or by or before any Governmental Authority (whether or not purportedly on behalf of the Borrower or any Subsidiary of the Borrower) pending or, to the knowledge of the Borrower, threatened against the Borrower, any Subsidiary of the Borrower or any of their respective Properties or rights, which, if adversely determined, could have a Material Adverse Effect. 4.6. Required Consents. No consent, authorization or approval of, filing with, notice to, or exemption by, stockholders, any Governmental Authority or any other Person not obtained is required to be obtained by the Borrower to authorize, or is required in connection with the execution, delivery and performance of the Loan Documents or is required to be obtained by the Borrower as a condition to the validity or enforceability of the Loan Documents. 4.7. No Conflicting Agreements. Neither the Borrower nor any Subsidiary of the Borrower is in default beyond any applicable grace or cure period under any mortgage, indenture, contract or agreement to which it is a party or by which it or any of its Property is bound, the effect of which default could reasonably be expected to have a Material Adverse Effect. The execution, delivery or carrying out of the terms of the Loan Documents will not - 55 - 62 constitute a default under, or result in the creation or imposition of, or obligation to create, any Lien upon any Property of the Borrower or any Subsidiary of the Borrower pursuant to the terms of any such mortgage, indenture, contract or agreement. 4.8. Compliance with Applicable Laws. Neither the Borrower nor any Subsidiary of the Borrower is in default with respect to any judgment, order, writ, injunction, decree or decision of any Governmental Authority which default could reasonably be expected to have a Material Adverse Effect. The Borrower and each Subsidiary of the Borrower is in compliance in all material respects with all statutes, regulations, rules and orders applicable to Borrower or such Subsidiary of all Governmental Authorities, including, without limitation, (i) Environmental Laws and ERISA, a violation of which could reasonably be expected to have a Material Adverse Effect; and (ii) Sections 856-860 of the Code, compliance with which is required to preserve the Borrower's status as a REIT. 4.9. Taxes. Each of the Borrower and its Subsidiaries has filed or caused to be filed all tax returns required to be filed and has paid, or has filed appropriate extensions and has made adequate provision for the payment of, all taxes shown to be due and payable on said returns or in any assessments made against it (other than those being contested as permitted under Section 7.4) in which the failure to pay could reasonably be expected to have a Material Adverse Effect, and no tax Liens have been filed with respect thereto. The charges, accruals and reserves on the books of the Borrower and each Subsidiary of the Borrower with respect to all federal, state, local and other taxes are, to the best knowledge of the Borrower, adequate for the payment of all such taxes, and the Borrower knows of no unpaid assessment which is due and payable against it or any of its Subsidiaries or any claims being asserted which could reasonably be expected to have a Material Adverse Effect. 4.10. Governmental Regulations. Neither the Borrower nor any Subsidiary of the Borrower is subject to regulation under the Public Utility Holding Company Act of 1935, as amended, the Federal Power Act, as amended, or the Investment Company Act of 1940, as amended, and neither the Borrower nor any Subsidiary of the Borrower is subject to any statute or regulation which prohibits or restricts the incurrence of Indebtedness under the Loan Documents, including, without limitation, statutes or regulations relative to common or contract carriers or to the sale of electricity, gas, steam, water, telephone, telegraph or other public utility services. - 56 - 63 4.11. Federal Reserve Regulations; Use of Loan Proceeds. Neither the Borrower nor any Subsidiary of the Borrower is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. No part of the proceeds of the Loans will be used, directly or indirectly, for a purpose which violates any law, rule or regulation of any Governmental Authority, including, without limitation, the provisions of Regulations T, U or X of the Board of Governors of the Federal Reserve System, as amended. No part of the proceeds of the Loans will be used, directly or indirectly, to purchase or carry Margin Stock or to extend credit to others for the purpose of purchasing or carrying Margin Stock. 4.12. Plans; Multiemployer Plans. As of the Effective Date, each of the Borrower and its ERISA Affiliates maintains or makes contributions only to the Plans and Multiemployer Plans listed on Schedule 4.12. Each Plan, and, to the best knowledge of the Borrower, each Multiemployer Plan, is in compliance in all material respects with, and has been administered in all material respects in compliance with, the applicable provisions of ERISA, the Code and any other applicable Federal or state law, and no event or condition is occurring or exists concerning which the Borrower would be under an obligation to furnish a report to the Administrative Agent and each Lender as required by Section 7.2(d). As of December 31, 1998, each Plan was "fully funded", which for purposes of this Section means that the fair market value of the assets of such Plan is not less than the present value of the accrued benefits of all participants in the Plan, computed on a plan termination basis. To the best knowledge of the Borrower, no Plan has ceased being fully funded. 4.13. Financial Statements. The Borrower has heretofore delivered to the Administrative Agent and the Lenders (i) copies of the audited Consolidated Balance Sheet of the Borrower and its Consolidated Subsidiaries as of December 31, 1998, and the related Consolidated Statements of Operations, Stockholders' Equity and Cash Flows for the Borrower and its Consolidated Subsidiaries for the five months ended December 31, 1998 and the 12 months ended July 31, 1998, and (ii) the Consolidated Statements of Income and Cash Flows for the Borrower and its Consolidated Subsidiaries for the fiscal quarters of the Borrower ending March 31, 1999 and June 30, 1999, certified by its Chief Financial Officer (collectively, with the related notes and schedules, the "Financial Statements"). The Financial Statements fairly present the Consolidated financial condition and results of the operations of the Borrower and its Consolidated Subsidiaries as of the dates and for the periods indicated therein and have been prepared in conformity with GAAP. Except as reflected in the Financial Statements or in the notes thereto, neither the - 57 - 64 Borrower nor any Subsidiary of the Borrower has any obligation or liability of any kind (whether fixed, accrued, contingent, unmatured or otherwise) which, in accordance with GAAP, should have been shown on the Financial Statements and was not. Since June 30, 1999 through the Effective Date there has been no material adverse change in the financial condition or business of the Borrower and its Subsidiaries taken as a whole. 4.14. Property. Each of the Borrower and its Subsidiaries has good and marketable title to all of its Property, title to which is material to the Borrower or such Subsidiary, subject to no Liens, except Permitted Liens. There are no unpaid or outstanding real estate or similar taxes or assessments on or against any Real Property other than (i) real estate or other taxes or assessments that are not yet due and payable, and (ii) such taxes as the Borrower or any Subsidiary of the Borrower is contesting in good faith or which individually or in the aggregate could not reasonably be expected to have a Materially Adverse Effect. There are no pending eminent domain proceedings against any Real Property, and, to the knowledge of the Borrower, no such proceedings are presently threatened or contemplated by any Governmental Authority against any Real Property, which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect. None of the Real Property is now damaged as a result of any fire, explosion, accident, flood or other casualty which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect. 4.15. Franchises, Intellectual Property, Etc. Each of the Borrower and its Subsidiaries possesses or has the right to use all franchises, Intellectual Property, licenses and other rights, in each case that are material and necessary for the conduct of its business, with no known conflict with the valid rights of others which could reasonably be expected to have a Material Adverse Effect. No event has occurred which permits or, to the best knowledge of the Borrower, after notice or the lapse of time or both, or any other condition, could reasonably be expected to permit, the revocation or termination of any such franchise, Intellectual Property, license or other right and which revocation or termination could reasonably be expected to have a Material Adverse Effect. 4.16. Environmental Matters. (a) The Borrower and each of its Subsidiaries is in compliance with the requirements of all applicable Environmental Laws except for such non-compliance which could not, either individually or in the aggregate, be reasonably expected to have a Material Adverse Effect. - 58 - 65 (b) No Hazardous Substances have been (i) generated or manufactured on, transported to or from, treated at, stored at or discharged from any Real Property in violation of any Environmental Laws; (ii) discharged into subsurface waters under any Real Property in violation of any Environmental Laws; or (iii) discharged from any Real Property on or into property or waters (including subsurface waters) adjacent to any Real Property in violation of any Environmental Laws, which violation, in the case of either (i), (ii) or (iii) could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. (c) Neither the Borrower nor any of its Subsidiaries (i) has received notice (written or oral) or otherwise learned of any claim, demand, suit, action, proceeding, event, condition, report, directive, lien, violation, non-compliance or investigation indicating or concerning any potential or actual liability (including, without limitation, potential liability for enforcement, investigatory costs, cleanup costs, government response costs, removal costs, remedial costs, natural resources damages, property damages, personal injuries or penalties) arising in connection with (x) any non-compliance with or violation of the requirements of any applicable Environmental Laws, or (y) the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by the Borrower or any Subsidiary of the Borrower) or the release or threatened release of any Hazardous Substance into the environment which, in either case, could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (ii) has any threatened or actual liability in connection with the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by the Borrower or any Subsidiary of the Borrower) or the release or threatened release of any Hazardous Substance into the environment which, in either case, could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (iii) has received notice of any federal or state investigation evaluating whether any remedial action is needed to respond to the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by the Borrower or any Subsidiary of the Borrower) or a release or threatened release of any Hazardous Substance into the environment for which the Borrower or any Subsidiary of the Borrower is or may be liable the results of which could, in either case, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, or (iv) has received notice that the Borrower or any Subsidiary of the Borrower is or may be liable to any Person under any Environmental Law which liability could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. (d) To the best of the Borrower's knowledge, no Real Property is located in an area identified by the Secretary of Housing and Urban Development as an area having special flood hazards, or if any such Real Property is located in such a special flood hazard area, then the Borrower has obtained all insurance that is required to - 59 - 66 be maintained by law or which is customarily maintained by Persons engaged in similar businesses and owning similar Properties in the same general areas in which the Borrower operates. 4.17. Labor Relations. Neither the Borrower nor any of its Subsidiaries is a party to any collective bargaining agreement, other than the collective bargaining agreement covering fewer than 10 employees at the Roosevelt Mall Shopping Center in Philadelphia, Pennsylvania, and, to the best knowledge of the Borrower, no petition has been filed or proceedings instituted by any employee or group of employees with any labor relations board seeking recognition of a bargaining representative with respect to the Borrower or such Subsidiary. There are no material controversies pending between the Borrower or any Subsidiary and any of their respective employees, which could reasonably be expected to have a Material Adverse Effect. 4.18. Burdensome Obligations. Neither the Borrower nor any of its Subsidiaries is a party to or bound by any franchise, agreement, deed, lease or other instrument, or subject to any corporate restriction which, in the opinion of the management of the Borrower or such Subsidiary, is so unusual or burdensome, in the context of its business, as in the foreseeable future might adversely affect or impair the revenue or cash flow of the Borrower or such Subsidiary in such a manner as could reasonably be expected to have a Material Adverse Effect, or materially and adversely affect or impair the ability of the Borrower or such Subsidiary to perform its obligations under the Loan Documents. The Borrower does not presently anticipate that future expenditures by the Borrower or any Subsidiary of the Borrower needed to meet the provisions of federal or state statutes, orders, rules or regulations will be so burdensome as to result in a Material Adverse Effect. 4.19. Solvency. On the Effective Date and immediately following the making of each Loan, and after giving effect to the application of the proceeds of such Loan: (a) the fair value of the assets of the Borrower and its Subsidiaries, taken as a whole, at a fair valuation, will exceed the debts and liabilities, including Contingent Obligations, of the Borrower and its Subsidiaries, taken as a whole; (b) the present fair saleable value of the property of the Borrower and its Subsidiaries, taken as a whole, will be greater than the amount that will be required to pay the probable liability of the debts and other liabilities, subordinated, contingent or otherwise of the Borrower and its Subsidiaries, as such debts and other liabilities become absolute and matured; (c) the Borrower and its Subsidiaries, taken as a whole, will be able to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (d) the - 60 - 67 Borrower and its Subsidiaries, taken as a whole, will not have unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted hereafter. 4.20. REIT Status. The Borrower (i) has made an election pursuant to Section 856 of the Code to qualify as a REIT, (ii) has satisfied and continues to satisfy all of the requirements under Sections 856-859 of the Code and the regulations and rulings issued thereunder which must be satisfied for the Borrower to maintain its status as a REIT, and (iii) is in compliance in all material respects with all Code sections applicable to REITs generally and the regulations and rulings issued thereunder. 4.21. Rent Roll and List of Unencumbered Assets. A true, correct and complete Rent Roll, dated not earlier than 30 days prior to the date of this Agreement, and a list of all the Unencumbered Assets of the Borrower as of such date is attached hereto as Schedule 4.21. 4.22. Year 2000. The Borrower has completed its assessment of its centralized corporate business and technical information systems as to Year 2000 compliance and functionality and has completed its remediation of such systems as more particularly set forth on Schedule 4.22. In addition, the Company has completed the identification and review of major computer hardware and software suppliers and has verified the Year 2000 preparedness of these suppliers as more particularly set forth on Schedule 4.22. All statements and disclosures on Schedule 4.22 are true and correct in all material respects and fairly present the Year 2000 preparedness of the Borrower. 4.23. Operation of Business. The Borrower is a self-advised and self-managed REIT. 4.24. No Misrepresentation. No representation or warranty contained herein and no certificate or report furnished or to be furnished by the Borrower or any Subsidiary of the Borrower in connection with the transactions contemplated hereby, contains or will contain a misstatement of material fact, or, to the best knowledge of the Borrower, omits or will omit to state a material fact required to be stated in order to make the statements herein or therein contained not misleading in the light of the circumstances under which made. - 61 - 68 5. CONDITIONS TO FIRST LOANS OR LETTERS OF CREDIT In addition to the conditions precedent set forth in Section 6, the obligation of each Lender to make its first Loan, the Swingline Lender to make the first Swingline Loan or the Issuing Bank to issue the first Letter of Credit shall be subject to the fulfillment of the following conditions precedent: 5.1. Evidence of Action. (a) The Administrative Agent shall have received a certificate, dated the first Borrowing Date, of the Secretary or Assistant Secretary of the Borrower substantially in the form of Exhibit J (i) attaching a true and complete copy of the resolutions of its Board of Directors authorizing the execution and delivery of the Loan Documents by the Borrower and the performance of the Borrower's obligations thereunder, and of all other documents evidencing other necessary action (in form and substance reasonably satisfactory to the Administrative Agent) taken by it to authorize the Loan Documents and the transactions contemplated thereby, (ii) attaching a true and complete copy of its articles of incorporation and by-laws, (iii) setting forth the incumbency of its officer or officers who may sign the Loan Documents, including therein a signature specimen of such officer or officers, and (iv) certifying that said corporate charter and by-laws are true and complete copies thereof, are in full force and effect and have not been amended or modified. (b) The Administrative Agent shall have received a certificate, dated the first Borrowing Date, of the Secretary or Assistant Secretary of each Subsidiary Guarantor substantially in the form of Exhibit K (i) attaching a true and complete copy of the resolutions of its Board of Directors or Trustees, as the case may be, authorizing its execution and delivery of the Guaranty and the performance of its obligations thereunder, and of all other documents evidencing other necessary action (in form and substance reasonably satisfactory to the Administrative Agent) taken by it to authorize the Guaranty and the transactions contemplated thereby, (ii) attaching a true and complete copy of its articles of incorporation or corporate charter or declaration of trust and, if applicable, by-laws, (iii) setting forth the incumbency of its officer or officers who may sign the Guaranty, including therein a signature specimen of such officer or officers, and (iv) certifying that said articles of incorporation, corporate charter or declaration of trust and, if applicable, by-laws, are true and complete copies thereof, is in full force and effect and has not been amended or modified. (c) The Administrative Agent shall have received certificates of good standing for the Borrower from the Maryland State Department of Assessments and Taxation and for each Subsidiary Guarantor from the Secretary of State for the state in which such Subsidiary Guarantor is incorporated, and for the Borrower from each - 62 - 69 jurisdiction other than Maryland in which the Borrower is qualified to do business, provided that such Secretaries issue such certificates with respect to the Borrower. 5.2. This Agreement. The Administrative Agent shall have received counterparts of this Agreement signed by each of the parties hereto (or receipt by the Administrative Agent from a party hereto of a facsimile signature page signed by such party which shall have agreed to promptly provide the Administrative Agent with originally executed counterparts hereof). 5.3. Notes. The Administrative Agent shall have received the Notes, duly executed by an Authorized Signatory of the Borrower. 5.4. Guaranty. The Administrative Agent shall have received counterparts of the Guaranty signed by each of the Subsidiary Guarantors (or receipt by the Administrative Agent from a party hereto of a facsimile signature page signed by such party which shall have agreed to promptly provide the Administrative Agent with originally executed counterparts hereof). 5.5. Other Credit Agreement. The Administrative Agent shall have received counterparts of the Other Credit Agreement signed by each of the parties thereto (or receipt by the Administrative Agent from a party thereto of a facsimile signature page signed by such party which shall have agreed to promptly provide the Administrative Agent with originally executed counterparts hereof), and the Borrower shall have complied with all other conditions of Article 5 of the Other Credit Agreement which are conditions precedent to the first loan thereunder. 5.6. Litigation. There shall be no injunction, writ, preliminary restraining order or other order of any nature issued by any Governmental Authority in any respect affecting the transactions provided for herein and no action or proceeding by or before any Governmental Authority shall have been commenced and be pending or, to the knowledge of the Borrower, threatened, seeking to prevent or delay the transactions contemplated by the Loan Documents or challenging any other terms and provisions hereof or thereof or seeking any damages in connection therewith and the Administrative - 63 - 70 Agent shall have received a certificate of an Authorized Signatory of the Borrower to the foregoing effects. 5.7. Opinion of Counsel to the Borrower. The Administrative Agent shall have received an opinion of (i) Hogan & Hartson, L.L.P., outside counsel to the Borrower, and (ii) Steven F. Siegel, Esq., in-house counsel to the Borrower, and (iii) counsel to each Subsidiary Guarantor, each addressed to the Administrative Agent and the Lenders, and each dated the first Borrowing Date, covering the matters set forth in Exhibit L. 5.8. Fees. The Facility Fee, to the extent then due and payable, and all fees payable to the Administrative Agent, the Lead Arranger, the Co-Documentation Agents and the Lenders shall have been paid. 5.9. Fees and Expenses of Special Counsel. The fees and expenses of Special Counsel in connection with the preparation, negotiation and closing of the Loan Documents shall have been paid. 5.10. Year 2000 Assurances. On the Effective Date, the Administrative Agent shall have received such documentation and information from the Borrower and its Subsidiaries as may be reasonably satisfactory to the Administrative Agent demonstrating that the representations of the Borrower in Section 4.22 are true and correct as of the Effective Date. 6. CONDITIONS OF LENDING - ALL LOANS The obligation of each Lender to make any Revolving Credit Loan, of the Swingline Lender to make a Swingline Loan or the Issuing Bank to issue a Letter of Credit is subject to the satisfaction of the following conditions precedent as of the date of such Loan: 6.1. Compliance. On each Borrowing Date and after giving effect to the Loans to be made or created or Letter of Credit issued: (a) the Borrower shall be in compliance with all of the terms, covenants and conditions hereof, (b) there shall not exist and be continuing any Default or Event of Default, (c) the representations and warranties contained in the Loan Documents shall be true and correct with the same effect as though such - 64 - 71 representations and warranties had been made on such Borrowing Date (except for representations and warranties that speak as of a specific date, which need only be true and correct as of such date), (d) the sum of the Revolving Credit Loans, the LC Exposure and the Swingline Exposure shall not exceed the Total Commitment Amount, and (e) the total outstanding Swingline Loans shall not exceed the Swingline Sublimit. Each notice requesting a Revolving Credit Loan, a Competitive Bid Borrowing, a Swingline Loan or the issuance of a Letter of Credit shall be deemed to constitute a representation and warranty by the Borrower on the date thereof that each of the foregoing matters is true and correct in all respects. 6.2. Loan Closings. All documents required by the provisions of the Loan Documents to be executed or delivered to the Administrative Agent on or before the applicable Borrowing Date or prior to the issuance of a Letter of Credit shall have been executed and shall have been delivered at the office of the Administrative Agent set forth in Section 11.2 on or before such Borrowing Date. 6.3. Borrowing Request. With respect to each borrowing of a Revolving Credit Loan or a Swingline Loan, the Administrative Agent shall have received a Conventional Borrowing Request, a Competitive Bid Borrowing Request, or a Swingline Borrowing Request, as the case may be, duly executed by an Authorized Signatory of the Borrower. With respect to the issuance of a Letter of Credit, the Administrative Agent shall have received the documents required pursuant to Section 2.9(b). 6.4. Documentation and Proceedings. All corporate matters and legal proceedings and all documents and papers in connection with the transactions contemplated by the Loan Documents shall be reasonably satisfactory in form and substance to the Administrative Agent and the Administrative Agent shall have received all information and copies of all documents which the Administrative Agent or the Required Lenders may reasonably have requested in connection therewith, such documents (where appropriate) to be certified by an Authorized Signatory of the Borrower or proper Governmental Authorities. 6.5. Required Acts and Conditions. All acts, conditions and things (including, without limitation, the obtaining of any necessary regulatory approvals and the making of any filings, recordings or registrations) required to be done or performed by the Borrower and to have happened on or prior to such Borrowing Date and which are necessary for the - 65 - 72 continued effectiveness of the Loan Documents, shall have been done or performed and shall have happened in due compliance with all applicable laws. 6.6. Approval of Special Counsel. All legal matters in connection with the making of each Loan and issuance of each Letter of Credit shall be reasonably satisfactory to Special Counsel. 6.7. Supplemental Opinions. If reasonably requested by the Administrative Agent with respect to the applicable Borrowing Date, there shall have been delivered to the Administrative Agent favorable supplementary opinions of counsel to the Borrower, addressed to the Administrative Agent and the Lenders and dated such Borrowing Date, covering such matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request. 6.8. Other Documents. The Administrative Agent shall have received such other documents and information with respect to the Borrower and its Subsidiaries or the transactions contemplated hereby as the Administrative Agent or the Lenders shall reasonably request. 7. AFFIRMATIVE COVENANTS The Borrower agrees that, so long as any Loan remains outstanding and unpaid, there exists any LC exposure, any other amount is owing under any Loan Document to any Lender or the Administrative Agent, or any Lender, the Swingline Lender or the Issuing Bank shall have any obligation to make Loans or Swingline Loans, or issue Letters of Credit, the Borrower shall: 7.1. Financial Statements. Maintain a standard system of accounting in accordance with GAAP, and furnish or cause to be furnished to the Administrative Agent and each Lender: (a) Annual Statements. As soon as available, but in any event within 120 days after the end of each fiscal year of the Borrower, a copy of its Consolidated Balance Sheet as at the end of such fiscal year, together with the related Consolidated Statements of Income, Stockholders' Equity and Cash Flows as of and through the end of such fiscal year, setting forth in each case in comparative form the figures for the preceding fiscal year. The Consolidated Balance Sheets and Consolidated Statements of - 66 - 73 Income, Stockholders' Equity and Cash Flows shall be audited and certified without qualification by the Accountants, which certification shall (i) state that the examination by such Accountants in connection with such Consolidated financial statements has been made in accordance with generally accepted auditing standards and, accordingly, includes the examination, on a test basis, of evidence supporting the amounts and disclosures in such Consolidated financial statements, and (ii) include the opinion of such Accountants that such Consolidated financial statements present fairly, in all material respects, the Consolidated financial position of the Borrower and its Subsidiaries, as of the date of such Consolidated financial statements, and the Consolidated results of their operations and their cash flows for each of the years identified therein in conformity with GAAP (subject to any change in the requirements of GAAP). (b) Annual Operating Statements and Rent Roll. As soon as available, but in any event within 60 days after the end of each fiscal year of the Borrower, copies of (i) the operating statements (in a form reasonably satisfactory to the Administrative Agent) for all Real Property of the Borrower, and (ii) a Rent Roll, each of which shall be certified by the Chief Financial Officer to be true, correct and complete in all material respects. (c) Quarterly Statements. As soon as available, but in any event within 60 days after the end of the first three fiscal quarters of the Borrower, a copy of the unaudited Consolidated Balance Sheet of the Borrower as at the end of each such quarterly period, together with the related unaudited Consolidated Statements of Income and Cash Flows for the elapsed portion of the fiscal year through the end of such period, setting forth in each case in comparative form the figures for the corresponding periods of the preceding fiscal year, certified by the Chief Financial Officer as being true, correct and complete in all material respects and as presenting fairly the Consolidated financial condition and the Consolidated results of operations of the Borrower and its Subsidiaries. (d) Quarterly Information Regarding Unencumbered Assets. As soon as available, but in any event 60 days after the end of each of the first three fiscal quarters of the Borrower (120 days after the end of the last fiscal quarter of the Borrower), a list of all the Unencumbered Assets owned by the Borrower, any wholly owned Subsidiary of the Borrower and each DownREIT Partnership as of the last day of such fiscal quarter setting forth the following information with respect to each such Unencumbered Asset as of such date: (i) asset type (i.e., retail shopping center or residential apartment building); (ii) location; (iii) percentage of the Unencumbered Asset owned by the Borrower, any wholly owned Subsidiary of the Borrower and each DownREIT Partnership; and (iv) the Net Operating Income for such Unencumbered Asset during such fiscal quarter. (e) Compliance Certificate. Within 60 days after the end of each of the first three fiscal quarters of the Borrower (120 days after the end of the last fiscal - 67 - 74 quarter of the Borrower), a Compliance Certificate, certified by the Chief Financial Officer, setting forth in reasonable detail the computations demonstrating the Borrower's compliance with the provisions of Sections 8.12, 8.13, 8.14, 8.15, 8.16 and 8.17. (f) Other Information. Such other information as the Administrative Agent or any Lender may reasonably request from time to time. 7.2. Certificates; Other Information. Furnish to the Administrative Agent and each Lender: (a) Defaults Under Other Indebtedness. Prompt written notice if: (i) any Indebtedness of the Borrower or any Subsidiary of the Borrower is declared or shall become due and payable prior to its stated maturity, or called and not paid when due, or (ii) a default that extends beyond any applicable notice or grace period shall have occurred under any note (other than the Notes) or the holder of any such note, or other evidence of Indebtedness, certificate or security evidencing any such Indebtedness or any obligee with respect to any other Indebtedness of the Borrower or any Subsidiary of the Borrower has the right to declare any such Indebtedness due and payable prior to its stated maturity, and, in the case of either (i) or (ii), the Indebtedness that is the subject of (i) or (ii) is, in the aggregate, $7,500,000 or more; (b) Action of Governmental Authorities. Prompt written notice of: (i) any citation, summons, subpoena, order to show cause or other document naming the Borrower or any Subsidiary of the Borrower a party to any proceeding before any Governmental Authority which could reasonably be expected to have a Material Adverse Effect or which calls into question the validity or enforceability of any of the Loan Documents, and include with such notice a copy of such citation, summons, subpoena, order to show cause or other document; (ii) any lapse or other termination of any Intellectual Property, license, permit, franchise or other authorization issued to the Borrower or any Subsidiary of the Borrower by any Person or Governmental Authority, which lapse or termination could reasonably be expected to have a Material Adverse Effect; and (iii) any refusal by any Person or Governmental Authority to renew or extend any such material Intellectual Property, license, permit, franchise or other authorization, which refusal could reasonably be expected to have a Material Adverse Effect; (c) SEC or other Governmental Reports and Filings. Promptly upon becoming available, copies of all regular, periodic or special reports which the Borrower or any Subsidiary of the Borrower may now or hereafter be required to file with or deliver to any securities exchange or the Securities and Exchange Commission, or any other Governmental Authority succeeding to the functions thereof, pursuant to the Securities Exchange Act of 1934, as amended. - 68 - 75 (d) ERISA Information. Promptly, and in any event within ten Business Days after the Borrower knows or has reason to know that any of the events or conditions enumerated below with respect to any Plan or Multiemployer Plan has occurred or exists, a statement signed by the Chief Financial Officer, setting forth details with respect to such event or condition and the action, if any, which the Borrower or an ERISA Affiliate proposes to take with respect thereto; provided, however, that if such event or condition is required to be reported or noticed to the PBGC, such statement, together with a copy of the relevant report or notice to the PBGC, shall be furnished promptly and in any event not later than ten days after it is reported or noticed to the PBGC: (i) any reportable event, as defined in Section 4043(b) of ERISA with respect to a Plan, as to which the PBGC has not by regulation waived the requirement of Section 4043(a) of ERISA that it be notified within thirty days of the occurrence of such event (provided that a failure to meet the minimum funding standard of Section 412 of the Code or of Section 302 of ERISA, including, without limitation, the failure to make, on or before its due date, a required installment under Section 412(m) of the Code or Section 302(e) of ERISA or the disqualification of such Plan for purposes of Section 4043(b)(1) of ERISA, shall be a reportable event regardless of the issuance of any waivers in accordance with Section 412(d) of the Code) and any request for a waiver under Section 412(d) of the Code for any Plan; (ii) the distribution under Section 4041 of ERISA of a notice of intent to terminate any Plan or any action taken by the Borrower or any ERISA Affiliate to terminate any Plan; (iii) the institution by the PBGC of proceedings under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by the Borrower or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan; (iv) the complete or partial withdrawal from a Multiemployer Plan by the Borrower or any ERISA Affiliate that results in liability under Section 4201 or 4204 of ERISA (including the obligation to satisfy secondary liability as a result of a purchaser default) or the receipt of the Borrower or any ERISA Affiliate of notice from a Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends to terminate or has terminated under Section 4041A of ERISA; (v) the institution of a proceeding by a fiduciary of any Multiemployer Plan against the Borrower or any ERISA Affiliate to enforce - 69 - 76 Section 515 of ERISA, which proceeding is not dismissed within thirty days from its commencement; (vi) the adoption of an amendment to any Plan pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA that would result in the loss of the tax-exempt status of the trust of which such Plan is a part or the Borrower or any ERISA Affiliate fails to timely provide security to such Plan in accordance with the provisions of said Sections; and (vii) any event or circumstance exists which may reasonably be expected to constitute grounds for the incurrence of material liability by the Borrower or any ERISA Affiliate under Title IV of ERISA or under Sections 412(c)(11) or 412(n) of the Code with respect to any employee benefit plan; (e) ERISA Reports. Promptly after the request of the Administrative Agent or any Lender therefor, copies of each annual report filed pursuant to Section 104 of ERISA with respect to each Plan (including, to the extent required by Section 104 of ERISA, the related financial and actuarial statements and opinions and other supporting statements, certifications, schedules and information referred to in Section 103 of ERISA) and each annual report filed with respect to each Plan under Section 4065 of ERISA; provided, however, that in the case of a Multiemployer Plan, such annual reports shall be furnished only if they are available to the Borrower or any ERISA Affiliate; (f) Notice of Proposed Sales or Transfers. Quarterly, on each date that a Compliance Certificate is to be delivered pursuant to Section 7.1(e), a list of all sales or transfers of any Unencumbered Assets (including any agreements for the sale or transfer of any Unencumbered Asset entered into during such fiscal quarter but not yet consummated); provided that, if during any such fiscal quarter of the Borrower any sale or transfer of an Unencumbered Asset, which combined with all other such sales or transfers of Unencumbered Assets during such fiscal quarter, would exceed $100,000,000 in the aggregate, then the Borrower shall promptly provide such list and a certification of the Chief Financial Officer as to the Borrower's compliance with Sections 8.12 and 8.16; (g) Casualties or Condemnations. Prompt written notice of any casualty or condemnation of any Real Property, if such casualty or condemnation could reasonably be expected to have a Material Adverse Effect; (h) Environmental Law Notices. Prompt written notice of any order, notice, claim or proceeding received by, or brought against, the Borrower or any Subsidiary of the Borrower, or with respect to any of the Real Property, under any Environmental Law, which could reasonably be expected to have a Material Adverse Effect; - 70 - 77 (i) Management Letters and Reports. Promptly after the same are received by the Borrower, copies of all management letters and similar reports provided to the Borrower by the Accountants; (j) New Subsidiaries. Notice of any Subsidiary that, as of the end of any fiscal quarter of the Borrower, satisfies the criteria in Section 7.11 with respect to Required Additional Guarantors, such notice to be delivered to the Administrative Agent concurrently with the delivery of the Compliance Certificate with respect to such quarter; (k) Changes in Name or Fiscal Year. Prompt written notice of (i) any change in the Borrower's name, with copies of all filings with respect to such name change attached thereto, and (ii) any change in its fiscal year from that in effect on the Effective Date; (l) Defaults or Events of Default. Prompt written notice if there shall occur and be continuing a Default or an Event of Default; and (m) Other Information. Such other information as the Administrative Agent or any Lender shall reasonably request from time to time. 7.3. Legal Existence. (a) Borrower's Legal Existence. Maintain its status as a Maryland corporation in good standing in the State of Maryland and in each other jurisdiction in which the failure so to do could reasonably be expected to have a Material Adverse Effect. (b) Legal Existence of Subsidiaries. Cause each Subsidiary of the Borrower to maintain its status as a real estate investment trust, business trust, corporation, limited liability company or partnership, as the case may be, in good standing in its state of formation and in each other jurisdiction in which the failure so to do either (i) would result in the occurrence of a Default, or (ii) could reasonably be expected to have a Material Adverse Effect. 7.4. Taxes. Pay and discharge when due, and cause each Subsidiary of the Borrower so to do, all Taxes, assessments and governmental charges, license fees and levies upon, or with respect to, the Borrower or such Subsidiary and all Taxes upon the income, profits and Property of the Borrower and its Subsidiaries, which if unpaid, could reasonably be expected to have a Material Adverse Effect, unless and to the extent only that such Taxes, assessments, governmental charges, license fees and levies shall be contested in good faith and by appropriate proceedings diligently conducted by the Borrower or such Subsidiary and such contest has the effect of staying the collection of - 71 - 78 any Lien from any Property of the Borrower or its Subsidiaries arising from such non-payment, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. 7.5. Insurance. Maintain, and cause each Subsidiary of the Borrower to maintain, insurance on its Property against such risks and in such amounts as is customarily maintained by Persons engaged in similar businesses and owning similar Properties in the same general areas in which the Borrower or the relevant Subsidiary operates, and file with the Administrative Agent within 10 Business Days after request therefor a detailed list of such insurance then in effect, stating the names of the carriers thereof, the policy numbers, the insureds thereunder, the amounts of insurance, dates of expiration thereof, and the Property and risks covered thereby, together with a certificate of the Chief Financial Officer certifying that in the opinion of such officer such insurance complies with the obligations of the Borrower under this Section, and is in full force and effect. 7.6. Payment of Indebtedness and Performance of Obligations. Pay and discharge when due, and cause each Subsidiary of the Borrower to pay and discharge, all lawful Indebtedness, obligations and claims for labor, materials and supplies or otherwise which, if unpaid, (i) would result in a Default, or (ii) could reasonably be expected to have a Material Adverse Effect, unless (with respect to clause (ii)) such Indebtedness shall be contested in good faith and by appropriate proceedings diligently conducted by the Borrower or such Subsidiary and such contest has the effect of staying the collection of any Lien from any Property of the Borrower or its Subsidiaries arising from such non-payment, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. 7.7. Maintenance of Property; Environmental Investigations. (a) In all material respects, at all times, maintain, protect and keep in good repair, working order and condition (ordinary wear and tear excepted), and cause each Subsidiary of the Borrower so to do, all Property necessary to the operation of the Borrower's or such Subsidiary's business. (b) In the event that the Administrative Agent shall have a reasonable basis for believing that Hazardous Substances may be on, at, under or around any Real Property in violation of any applicable Environmental Law which, individually or in the - 72 - 79 aggregate could reasonably be expected to have a Material Adverse Effect, promptly conduct and complete (at the Borrower's expense) all investigations, studies, samplings and testings relative to such Hazardous Substances as the Administrative Agent may reasonably request. 7.8. Observance of Legal Requirements. (a) Observe and comply in all respects, and cause each Subsidiary of the Borrower so to do, with all laws, ordinances, orders, judgments, rules, regulations, certifications, franchises, permits, licenses, directions and requirements of all Governmental Authorities, which now or at any time hereafter may be applicable to it, except (i) where noncompliance with any of the foregoing (individually or in the aggregate) could not reasonably be expected to have a Material Adverse Effect, or (ii) such thereof as shall be contested in good faith and by appropriate proceedings diligently conducted by it and such contest has the effect of staying the collection of any Lien from any Property of the Borrower or its Subsidiaries arising from such noncompliance, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. (b) Use and operate all of its facilities and property in compliance with all Environmental Laws and cause each of its Subsidiaries so to do, and keep all necessary permits, approvals, certificates, licenses and other authorizations relating to environmental matters in effect and remain in compliance therewith and cause each of its Subsidiaries so to do, and handle all Hazardous Materials in compliance with all applicable Environmental Laws and cause each of its Subsidiaries so to do, except where noncompliance with any of the foregoing (individually or in the aggregate) could not reasonably be expected to have a Material Adverse Effect. 7.9. Inspection of Property; Books and Records; Discussions. Keep proper books of record and account in which full, true and correct entries in conformity with GAAP and all requirements of law shall be made of all dealings and transactions in relation to its business and activities and permit representatives of the Administrative Agent and any Lender during normal business hours and on reasonable prior notice to visit its offices, to inspect any of its Property and to examine and make copies or abstracts from any of its books and records as often as may reasonably be desired, and to discuss the business, operations, prospects, licenses, Property and financial condition of the Borrower or and its Subsidiaries with the officers thereof and the Accountants. - 73 - 80 7.10. Licenses, Intellectual Property. Maintain, and cause each Subsidiary of the Borrower to maintain, in full force and effect, all material licenses, franchises, Intellectual Property, permits, authorizations and other rights as are necessary for the conduct of its business. 7.11. Required Additional Guarantors. At any time after the date hereof, and with respect to any Subsidiary of the Borrower, whether presently existing or hereafter formed or acquired (other than Excel Realty Partners, L.P. and E. H. Properties, L.P.) which is not a Subsidiary Guarantor at such time, cause such Subsidiary to execute and deliver a Guaranty to the Administrative Agent, for the benefit of the Lenders, promptly after the Administrative Agent's request therefor, duly executed by such Subsidiary (together with the certificates and attachments described in Section 5.1(b) and (c) with respect to such Subsidiary and an opinion of counsel in the form required pursuant to Section 5.7(iii)) if at such time such Subsidiary owns Property having a book value of $75,000,000 or more. Notwithstanding the foregoing, the foregoing book value conditions of this Section shall not be applicable from and after the occurrence of, and during the continuance of, an Event of Default (it being understood that at such time, the Administrative Agent can require any Subsidiary of the Borrower which has not executed a Guaranty to immediately comply with requirements of this Section). 7.12. REIT Status; Operation of Business. (a) Maintain its status under Sections 856 et seq. of the Code as a REIT. (b) Carry on all business operations of the Borrower as a self-advised, self-managed REIT. (c) Manage, or cause one or more of its Subsidiaries at all times to manage, at least 90% of all Properties of the Borrower and its Subsidiaries. 7.13. Termination of Existing Credit Agreements. On the Effective Date, the Borrower shall qualify for, and shall request, a Loan for the purpose of paying all loans outstanding under the Existing Credit Agreements, together with all interest, fees, breakage costs and other amounts outstanding thereunder, and shall terminate any commitment, or right to borrow, under the Existing Credit Agreements. - 74 - 81 8. NEGATIVE COVENANTS The Borrower agrees that, so long as any Loan remains outstanding and unpaid, there exists any LC exposure, any other amount is owing under any Loan Document to any Lender or the Administrative Agent, or any Lender, the Swingline Lender or the Issuing Bank shall have any obligation to make Loans or Swingline Loans, or issue Letters of Credit, the Borrower shall not, directly or indirectly: 8.1. Liens. Create, incur, assume or suffer to exist any Lien upon any of its Property, whether now owned or hereafter acquired, or permit any Subsidiary of the Borrower so to do, except (i) Liens for Taxes, assessments or similar charges incurred in the ordinary course of business which are not delinquent or the existence of which do not otherwise violate the representations in Section 7.4, (ii) Liens in connection with workers' compensation, unemployment insurance or other social security obligations (but not ERISA), (iii) deposits or pledges to secure bids, tenders, contracts (other than contracts for the payment of money), leases, statutory obligations, surety and appeal bonds and other obligations of like nature arising in the ordinary course of business, (iv) zoning ordinances, easements, rights of way, use restrictions, exclusive use limitations in any lease of Real Property, reciprocal easement agreements, minor defects, irregularities, and other similar restrictions and encumbrances affecting Real Property, which do not materially adversely affect the value of such Real Property or the financial condition of the Borrower or such Subsidiary of the Borrower or materially impair its use for the operation of the business of the Borrower or such Subsidiary, (v) statutory Liens arising by operation of law such as mechanics', materialmen's, carriers', warehousemen's liens incurred in the ordinary course of business which are not delinquent or the existence of which do not otherwise violate the representations in Section 7.6, (vi) Liens arising out of judgments or decrees which are being contested in accordance with Section 7.8 or the existence of which do not otherwise violate the representations in Section 7.8 or result in a default pursuant to Section 9.1(j), (vii) mortgages on Real Property, provided that the existence of such mortgages, and the indebtedness secured thereby, does not cause the Borrower to be in violation of Section 8.12 or 8.16, (viii) Liens in favor of the Borrower or any Subsidiary Guarantor, provided that the Indebtedness secured by any such Lien is held by the Borrower or such Subsidiary Guarantor, (ix) the interests of lessees and lessors under leases of real or personal property made in the ordinary course of business which could not reasonably be expected (individually or in the aggregate) to have a Material Adverse Effect and (x) Liens not otherwise permitted by clauses (i) through (ix) of this Section which do not in the aggregate exceed $5,000,000. - 75 - 82 8.2. Merger, Consolidation and Certain Dispositions of Property. (a) Consolidate with, be acquired by, or merge into or with any Person, or sell, lease or otherwise dispose of all or substantially all of its Property (in one transaction or a series of transactions), or permit any Subsidiary Guarantor of the Borrower so to do, or liquidate or dissolve, except (i) the merger or consolidation of any Subsidiary Guarantor of the Borrower into or with the Borrower, (ii) the merger or consolidation of any two or more Subsidiary Guarantors, or (iii) the merger or consolidation of the Borrower or Subsidiary Guarantor with any other Person, provided that (A) the Borrower or such Subsidiary Guarantor is the surviving entity in such merger or consolidation, (B) the total book value of the assets of the entity which is merged into or consolidated with the Borrower or such Subsidiary Guarantor is less than 20% of the total book value of the assets of the Borrower immediately following such merger or consolidation, (C) immediately prior to such merger or consolidation the Borrower shall have provided to the Administrative Agent and each of the Lenders a Compliance Certificate prepared on a pro-forma basis (and adjusted in the best good faith estimate of the Borrower, based on the advice of the Accountants, to give effect to such merger or consolidation) demonstrating that after giving effect to such merger or consolidation, no Default shall exist with respect to any of the covenants set forth in Sections 8.12, 8.13, 8.14, 8.15, 8.16 and 8.17 and (D) after giving effect to such merger or consolidation, no Event of Default shall exist. (b) Sell, transfer, master lease or dispose of any of its Property, either directly or indirectly, except that if at the time thereof and immediately after giving effect thereto, no Default shall have occurred, (i) any Subsidiary of the Borrower may sell, transfer, master lease or otherwise dispose of its assets to the Borrower or to any other Subsidiary, and (ii) the Borrower or any Subsidiary of the Borrower may sell Property in an arm's length transaction (or, if the transaction involves an Affiliate of the Borrower or a Subsidiary of the Borrower, if the transaction complies with Section 8.8) for the fair market value thereof, as reasonably determined by the Borrower, provided that such sale could not reasonably be expected to have a Material Adverse Effect and provided further that for any fiscal year of the Borrower, any sale, transfer, master lease or disposition of Property in reliance on this clause (ii) which when combined with all other such sales, transfers, master leases or dispositions made in such fiscal year shall not exceed 25% of the total book value of all Property of the Borrower and its Subsidiaries determined as of the first day of such fiscal year. 8.3. Investments, Loans, Etc. At any time, purchase or otherwise acquire, hold or invest in the Stock of, or any other interest in, any Person, or make any loan or advance to, or enter into any arrangement for the purpose of providing funds or credit to, or make any other investment, whether by way of capital contribution, time deposit or otherwise, in or with - 76 - 83 any Person, or permit any Subsidiary of the Borrower so to do, (all of which are sometimes referred to herein as "Investments") except the following (to the extent that maintaining any thereof would not at any time violate the requirements of Section 856(c) of the Code): (a) demand deposits, certificates of deposit, bankers acceptances and domestic and eurodollar time deposits with any Lender, or any other commercial bank, trust company or national banking association incorporated under the laws of the United States or any State thereof and having undivided capital, surplus and undivided profits exceeding $500,000,000 and a long term debt rating of A or A2, as determined, respectively, by S&P and Moody's; (b) short-term direct obligations of the United States of America or agencies thereof whose obligations are guaranteed by the United States of America; (c) securities commonly known as "commercial paper" issued by a corporation organized and existing under the laws of the United States or any State thereof which at the time of purchase are rated by S&P or Moody's at not less than "A1" or "P1," respectively; (d) mortgage-backed securities guaranteed by the Governmental National Mortgage Association, the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation and other mortgage-backed bonds which at the time of purchase are rated by S&P or Moody's at not less than "Aa" or "AA," respectively; (e) repurchase agreements having a term not greater than 90 days and fully secured by securities described in the foregoing paragraph (b) or (d) with banks described in the foregoing paragraph (a) or with financial institutions or other corporations having total assets in excess of $50,000,000; (f) shares of "money market funds" registered with the SEC under the Investment Company Act of 1940 which maintain a level per-share value, invest principally in the investments described in one or more of the foregoing paragraphs (a) through (e) and have total assets of in excess of $50,000,000; (g) Real Property and loans secured by mortgages on Real Property; (h) equity investments in any Person (other than Subsidiaries) and notes receivable investments in any Person (other than Subsidiaries), the aggregate principal amount of which (combined with any other equity investments and notes receivable investments in any Person permitted pursuant to this paragraph (h)) do not exceed 25% of the Total Capital of the Borrower; - 77 - 84 (i) Investments (debt or equity) in Subsidiaries of the Borrower; (j) investments in respect of (1) equipment, inventory and other tangible personal property acquired in the ordinary course of business, (2) current trade and customer accounts receivable for services rendered in the ordinary course of business, (3) advances to employees for travel expenses other company-related expenses, and (4) prepaid expenses made in the ordinary course of business; (k) Hedging Agreements made in connection with any Indebtedness; (l) repurchases of any common or preferred stock or other equity interests (or securities convertible into such interests) in the Borrower or any Subsidiary that have been previously issued by the Borrower or such Subsidiary, which do not exceed, in any calendar year, (1) 10% of the outstanding shares of common or preferred stock or other equity interests in Borrower or such Subsidiary, as applicable, as of the date hereof, plus (2) 10% of any additional shares of common or preferred stock or other equity interests in Borrower or such Subsidiary, as applicable, issued after the date hereof; (m) redemptions of preferred stock of the Borrower in accordance with the terms thereof; (n) redemptions for cash or common Stock of the Borrower of units of limited partner interests or limited liability company interests in a DownREIT Partnership; (o) loans to employees of the Borrower, provided that all such loans in the aggregate do not at any time exceed $15,000,000 in the aggregate; and (p) any other Investments not included in paragraphs (a) through (o) deemed appropriate by the Borrower, provided that in no event shall Investments made in reliance upon the exception set forth in this paragraph (p) exceed $50,000,000 at any one time; 8.4. Business Changes. Change in any material respect the nature of the business of the Borrower or its Subsidiaries as conducted on the Effective Date. 8.5. Amendments to Organizational Documents. Amend or otherwise modify its corporate charter or by-laws in any way (other than in connection with the issuance or classification of preferred stock of the Borrower) which would adversely affect the interests of the Administrative Agent and - 78 - 85 the Lenders under any of the Loan Documents, or permit any Subsidiary of the Borrower to amend its organizational documents in a manner which could have the same result. 8.6. Bankruptcy Proceedings. Institute against the Administrative Agent, the Co-Documentation Agents or any Lender, or join any other Person in instituting against the Administrative Agent, the Co-Documentation Agents or any Lender, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding or other proceeding under any federal or state bankruptcy or similar law, for one year and a day after the payment or prepayment in full of the Indebtedness due hereunder. 8.7. Sale and Leaseback. Enter into any arrangement with any Person providing for the leasing by it of Property which has been or is to be sold or transferred by it to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such Property or its rental obligations, or permit any Subsidiary of the Borrower so to do, except for sale and leasing transactions described herein for which the combined selling price of all Property subject to all such transactions does not exceed $50,000,000 in the aggregate. 8.8. Transactions with Affiliates. Become a party to any transaction in an amount that exceeds $60,000 with an Affiliate unless the terms and conditions relating thereto (i) have been approved by a majority of the disinterested directors of the Borrower, (ii) have been approved by a majority of votes cast by the stockholders of the Borrower, or (iii) are fair and reasonable to the Borrower, or permit any Subsidiary of the Borrower so to do. 8.9. Issuance of Additional Capital Stock by Subsidiary Guarantors. Permit any Subsidiary Guarantor to issue any additional Stock or other equity interest of such Subsidiary Guarantor, other than the issuance of partnership or limited liability company units in a DownREIT Partnership which is a Subsidiary Guarantor, provided that such units are issued in consideration of the contribution to the DownREIT Partnership of assets qualifying as "real estate assets" under Section 856(c) of the Code. 8.10. Hedging Agreements Enter into, or permit any of its Subsidiaries so to do, any Hedging Agreement, other than Hedging Agreements entered into in the ordinary course of business to hedge or mitigate interest rate risks to which the Borrower or any Subsidiary - 79 - 86 of the Borrower is exposed in the conduct of its business or the management of its liabilities. 8.11. Restricted Payments. (a) Permit the Borrower to make Restricted Payments, except that: (i) except as set forth in clause (ii) below, the Borrower may declare and pay dividends payable with respect to its equity securities in any fiscal quarter of the Borrower if after giving effect to such dividend, such dividend, when added to the amount of all other such dividends paid in the same fiscal quarter and the preceding three (3) fiscal quarters, would not exceed the greater of (A) ninety percent (90%) of its Funds from Operations for the four consecutive fiscal quarters ending prior to the quarter in which such dividend is paid, or (B) the minimum amount of such dividends required under the Code to enable the Borrower to continue to maintain its status under the Code as a REIT, as evidenced (in the case of clause (B)) by a certification of Chief Financial Officer containing calculations in reasonable detail satisfactory in form and substance to Administrative Agent; (ii) if an Event of Default under Section 9.1(a) or (b) has occurred and is continuing, the Borrower may declare and pay dividends with respect to its equity securities which shall not exceed the minimum such dividends required under the Code to enable the Borrower to continue to maintain its status under the Code as a REIT, as evidenced by a certification of Chief Financial Officer containing calculations in reasonable detail satisfactory in form and substance to Administrative Agent; (iii) the Borrower may effect Stock repurchases to the extent permitted by Section 8.3(l); (iv) the Borrower may effect "cashless exercises" of options granted under the Borrower's stock option plans; (v) the Borrower may distribute rights or equity securities under any rights plan adopted by the Borrower; and (vi) the Borrower may declare and pay dividends (or effect Stock splits or reverse Stock splits) with respect to its equity securities payable solely in additional shares of its equity securities. - 80 - 87 8.12. Unencumbered Assets Coverage Ratio. Permit the Unencumbered Assets Coverage Ratio to be less than 2.0:1.0 at any time. 8.13. Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio to be less than 1.75:1.0 at any time. 8.14. Minimum Tangible Net Worth. Permit the Tangible Net Worth of the Borrower and its Subsidiaries on a Consolidated basis at any time to be less than the sum of (i) $1,200,000,000, plus (ii) 80% of the aggregate net proceeds received by the Borrower from and after the Effective Date, in connection with the issuance of any capital stock of the Borrower. 8.15. Maximum Total Indebtedness. Permit at any time either (i) all Consolidated Total Indebtedness at such time to be more than 55% of Total Capital at such time, or (ii) the Consolidated Total Indebtedness secured by mortgages on Real Property owned by the Borrower and its Subsidiaries at such time to exceed 40% of Total Capital at such time. 8.16. Liabilities to Assets Ratio. Permit, at any time, the portion of the Consolidated Total Indebtedness consisting of Consolidated unsecured Indebtedness of the Borrower and its Subsidiaries at such time to be more than 50% of Unencumbered Asset Value at such time. 8.17. Maximum Book Value of Ancillary Assets. Permit the book value of the Ancillary Assets at any time to be more than 20% of the book value of all assets of the Borrower and its Subsidiaries on a Consolidated basis at such time. For purposes of this Section 8.17 the book value of any Ancillary Asset not owned 100%, directly or indirectly, by the Borrower or any of its Subsidiaries shall be adjusted by multiplying the same by the Borrower's Interest in such Ancillary Asset during the fiscal quarter of the Borrower ending as of any date of determination of such book value. - 81 - 88 9. DEFAULT 9.1. Events of Default. The following shall each constitute an "Event of Default" hereunder: (a) The failure of the Borrower to pay any installment of principal on any Note on the date when due and payable; or (b) The failure of the Borrower to pay any installment of interest or any other fees, expenses or other charges payable under any Loan Document within five Business Days of the date when due and payable; or (c) The use of the proceeds of any Loan in a manner inconsistent with or in violation of Section 2.17; or (d) The failure of the Borrower to observe or perform any covenant or agreement contained in Section 7.3, 7.12(a), 7.12(b), or 8 (other than Section 8.1, as to which the provisions of paragraph (e) below shall apply); or (e) The failure to observe or perform any other term, covenant, or agreement contained in any Loan Document and such failure shall have continued unremedied for a period of 30 days after notice thereof from the Administrative Agent to the Borrower; or (f) Any representation or warranty of the Borrower (or of any officer of the Borrower on its behalf) made in any Loan Document to which it is a party or in any certificate, report, opinion (other than an opinion of counsel) or other document delivered or to be delivered pursuant thereto, shall prove to have been incorrect or misleading (whether because of misstatement or omission) in any material respect when made; or (g) Any obligation of the Borrower (other than its obligations under the Notes) or any Subsidiary of the Borrower, whether as principal, guarantor, surety or other obligor, for the payment of any Indebtedness shall (i) become or shall be declared to be due and payable prior to the expressed maturity thereof, or (ii) shall not be paid when due or within any grace period for the payment thereof, or (iii) shall be subject, by the holder of the obligation evidencing such Indebtedness, to acceleration (after the expiration of any applicable notice and cure periods) prior to the expressed maturity thereof, and the sum of all such Indebtedness which is the subject of paragraphs (i) - (iii) inclusive exceeds (A) at any time, in the case of Indebtedness other than Non-Recourse Indebtedness, $7,500,000, and (B) in any calendar year, in the case of Non-Recourse Indebtedness, $50,000,000 in the aggregate during such year; or - 82 - 89 (h) The Borrower or any Subsidiary Guarantor of the Borrower shall (i) suspend or discontinue its business, (ii) make an assignment for the benefit of creditors, (iii) generally not be paying its debts as such debts become due, (iv) admit in writing its inability to pay its debts as they become due, (v) file a voluntary petition in bankruptcy, (vi) become insolvent (however such insolvency shall be evidenced), (vii) file any petition or answer seeking for itself any reorganization, arrangement, composition, readjustment of debt, liquidation or dissolution or similar relief under any present or future statute, law or regulation of any jurisdiction, (viii) petition or apply to any tribunal for any receiver, custodian or any trustee for any substantial part of its Property, (ix) be the subject of any such proceeding filed against it which remains undismissed for a period of 60 days, (x) file any answer admitting or not contesting the material allegations of any such petition filed against it or any order, judgment or decree approving such petition in any such proceeding, (xi) seek, approve, consent to, or acquiesce in any such proceeding, or in the appointment of any trustee, receiver, custodian, liquidator, or fiscal agent for it, or any substantial part of its Property, or an order is entered appointing any such trustee, receiver, custodian, liquidator or fiscal agent and such order remains in effect for 60 days, or (xii) take any formal action for the purpose of effecting any of the foregoing; or (i) An order for relief is entered under the United States bankruptcy laws or any other decree or order is entered by a court having jurisdiction (i) adjudging the Borrower or any Subsidiary Guarantor bankrupt or insolvent, (ii) approving as properly filed a petition seeking reorganization, liquidation, arrangement, adjustment or composition of or in respect of the Borrower or any Subsidiary Guarantor under the United States bankruptcy laws or any other applicable Federal or state law, (iii) appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of the Borrower or any Subsidiary Guarantor or of any substantial part of the Property thereof, or (iv) ordering the winding up or liquidation of the affairs of the Borrower or any Subsidiary Guarantor, and any such decree or order continues unstayed and in effect for a period of 60 days; or (j) Judgments or decrees against the Borrower or any Subsidiary of the Borrower aggregating in excess of $5,000,000 shall not be paid, stayed on appeal, discharged, bonded or dismissed for a period of 45 days; or (k) Any Loan Document shall cease, for any reason, to be in full force and effect, or the Borrower shall so assert in writing or shall disavow any of its obligations thereunder; or (l) An event or condition specified in Section 7.2(d) shall occur or exist with respect to any Plan or Multiemployer Plan and, as a result of such event or condition, together with all other such events or conditions, the Borrower shall be reasonably likely to incur a liability to a Plan, a Multiemployer Plan, the PBGC, or any - 83 - 90 combination thereof which would constitute, in the reasonable opinion of the Required Lenders, a Material Adverse Effect; or (m) There shall occur a Change of Control; or (n) If any Loan Document (i) is determined by any court or Governmental Authority to be illegal, invalid or unenforceable in accordance with its terms, or (ii) shall be canceled, terminated, revoked or rescinded other than in accordance with its terms or with the written consent or approval of the Lenders; or (o) (i) Any Subsidiary Guarantor shall fail to comply in any material respect with any covenant made by it in the Guaranty or if at any time any representation or warranty made by any Subsidiary Guarantor in the Guaranty or in any other document, statement or writing made to the Agent, the Co-Documentation Agents, the Lead Arranger or the Lenders shall prove to have been incorrect or misleading in any material respect when made, or (ii) if a default by any Subsidiary Guarantor shall occur under the Guaranty after the expiration of any applicable notice and grace period; or (iii) if any Subsidiary Guarantor shall revoke or attempt to revoke, contest, commence any action or raise any defense (other than the defense of payment) against its obligations under the Guaranty; or (p) There shall occur an Event of Default under and as defined in the Other Credit Agreement. Upon the occurrence of an Event of Default or at any time thereafter during the continuance thereof, (a) if such event is an Event of Default specified in clause (h) or (i) above, the Commitments shall immediately and automatically terminate and the Loans, all accrued and unpaid interest thereon, and all other amounts owing under the Loan Documents shall immediately become due and payable, and the Administrative Agent may, and upon the direction of the Required Lenders shall, exercise any and all remedies and other rights provided in the Loan Documents, and (b) if such event is any other Event of Default, any or all of the following actions may be taken: (i) with the consent of the Required Lenders, the Administrative Agent may, and upon the direction of the Required Lenders shall, by notice to the Borrower, declare the Commitments to be terminated forthwith, whereupon the Commitments shall immediately terminate; and (ii) with the consent of the Required Lenders, the Administrative Agent may, and upon the direction of the Required Lenders shall, by notice of default to the Borrower, declare the Loans, all accrued and unpaid interest thereon and all other amounts owing under the Loan Documents to be due and payable forthwith, whereupon the same shall immediately become due and payable, and the Administrative Agent may, and upon the direction of the Required Lenders shall, exercise any and all remedies and other rights provided pursuant to the Loan Documents. Except as otherwise provided in this Section, presentment, demand, protest and all other - 84 - 91 notices of any kind are hereby expressly waived. The Borrower hereby further expressly waives and covenants not to assert any appraisement, valuation, stay, extension, redemption or similar laws, now or at any time hereafter in force which might delay, prevent or otherwise impede the performance or enforcement of any Loan Document. In the event that the Commitments shall have been terminated or the Notes shall have been declared due and payable pursuant to the provisions of this Section, any funds received by the Administrative Agent and the Lenders from or on behalf of the Borrower shall be applied by the Administrative Agent and the Lenders in liquidation of the Loans and the obligations of the Borrower under the Loan Documents in the following manner and order: (i) first, to the payment of interest on and then the principal portion of any Loans which the Administrative Agent may have advanced on behalf of any Lender for which the Administrative Agent has not then been reimbursed by such Lender or the Borrower; (ii) second, to the payment of any fees or expenses due the Administrative Agent from the Borrower; (iii) third, to reimburse the Administrative Agent and the Lenders for any expenses (to the extent not paid pursuant to clause (ii)), due from the Borrower pursuant to the provisions of Section 11.5; (iv) fourth, to the payment of accrued Facility Fees, and all other fees, expenses and amounts due under the Loan Documents (other than principal and interest on the Notes); (v) fifth, to the payment of interest due on the Notes; (vi) sixth, to the payment of principal outstanding on the Notes; and (vii) seventh, to the payment of any other amounts owing to the Administrative Agent, the Co-Documentation Agents, the Lead Arranger and the Lenders under any Loan Document or other document or agreement entered into in connection with the transactions contemplated thereby. 10. THE AGENT 10.1. Appointment. Each Lender hereby irrevocably designates and appoints BNY as the Administrative Agent of such Lender under the Loan Documents and each such Lender hereby irrevocably authorizes BNY, as the Administrative Agent for such Lender, to take such action on its behalf under the provisions of the Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of the Loan Documents, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in any Loan Document, the Administrative Agent shall not have any duties or responsibilities, except those expressly set forth therein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into the Loan Documents or otherwise exist against the Administrative Agent. - 85 - 92 10.2. Delegation of Duties. The Administrative Agent may execute any of its duties under the Loan Documents by or through agents or attorneys-in-fact and shall be entitled to rely upon the advice of counsel concerning all matters pertaining to such duties. 10.3. Exculpatory Provisions. Neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with the Loan Documents (except for its own gross negligence or willful misconduct), or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower or any officer thereof contained in the Loan Documents or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, the Loan Documents or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of any of the Loan Documents or for any failure of the Borrower or any other Person to perform its obligations thereunder. The Administrative Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, the Loan Documents, or to inspect the properties, books or records of the Borrower. The Administrative Agent shall not be under any liability or responsibility whatsoever, as Administrative Agent, to the Borrower or any other Person as a consequence of any failure or delay in performance, or any breach, by any Lender of any of its obligations under any of the Loan Documents. 10.4. Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, opinion, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation reasonably believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Borrower), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent may treat each Lender, or the Person designated in the last notice filed with it under this Section, as the holder of all of the interests of such Lender in its Loans and in its Note until written notice of transfer, signed by such Lender (or the Person designated in the last notice filed with the Administrative Agent) and by the Person designated in such written notice of transfer, in form and substance satisfactory to the Administrative Agent, shall have been filed with the Administrative Agent. The Administrative Agent shall not be under any duty to examine or pass upon the validity, - 86 - 93 effectiveness or genuineness of the Loan Documents or any instrument, document or communication furnished pursuant thereto or in connection therewith, and the Administrative Agent shall be entitled to assume that the same are valid, effective and genuine, have been signed or sent by the proper parties and are what they purport to be. The Administrative Agent shall be fully justified in failing or refusing to take any action under the Loan Documents unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under the Loan Documents in accordance with a request or direction of the Required Lenders, and such request or direction and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Notes. 10.5. Notice of Default. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default unless the Administrative Agent has received written notice thereof from a Lender or the Borrower. In the event that the Administrative Agent receives such a notice, the Administrative Agent shall promptly give notice thereof to the Lenders. The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders, provided, however, that unless and until the Administrative Agent shall have received such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem to be in the best interests of the Lenders. 10.6. Non-Reliance on Administrative Agent and Other Lenders. Each Lender expressly acknowledges that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereinafter, including any review of the affairs of the Borrower, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Lender. Each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own evaluation of and investigation into the business, operations, Property, financial and other condition and creditworthiness of the Borrower and made its own decision to enter into this Agreement. Each Lender also represents that it will, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, evaluations and decisions in taking or not taking action under any Loan Document, and to make such investigation as it deems necessary to inform itself as to the business, operations, Property, financial and other condition and creditworthiness of the - 87 - 94 Borrower. Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, Property, financial and other condition or creditworthiness of the Borrower which may come into the possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or affiliates. 10.7. Indemnification. Each Lender agrees to indemnify and reimburse the Administrative Agent in its capacity as such (to the extent not promptly reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), pro rata according to its Commitment, from and against any and all liabilities, obligations, claims, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever including, without limitation, any amounts paid to the Lenders (through the Administrative Agent) by the Borrower pursuant to the terms of the Loan Documents, that are subsequently rescinded or avoided, or must otherwise be restored or returned) which may at any time (including, without limitation, at any time following the payment of the Notes) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of the Loan Documents or any other documents contemplated by or referred to therein or the transactions contemplated thereby or any action taken or omitted to be taken by the Administrative Agent under or in connection with any of the foregoing; provided, however, that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements to the extent resulting solely from the gross negligence or willful misconduct of the Administrative Agent. The agreements in this Section shall survive the payment of all amounts payable under the Loan Documents. 10.8. Administrative Agent in Its Individual Capacity. BNY and its affiliates may make loans to, accept deposits from, issue letters of credit for the account of, and generally engage in any kind of business with, the Borrower as though BNY was not Administrative Agent hereunder. With respect to the Commitment made or renewed by BNY and the Note issued to BNY, BNY shall have the same rights and powers under the Loan Documents as any Lender and may exercise the same as though it was not the Administrative Agent, and the terms "Lender" and "Lenders" shall in each case include BNY. - 88 - 95 10.9. Successor Administrative Agent. If at any time the Administrative Agent deems it advisable, in its sole discretion, it may submit to each of the Lenders a written notice of its resignation as Administrative Agent under this Agreement, such resignation to be effective upon the earlier of (i) the written acceptance of the duties of the Administrative Agent under the Loan Documents by a successor Administrative Agent and (ii) on the 60th day after the date of such notice. Upon any such notice of resignation, the Required Lenders shall have the right to appoint from among the Lenders a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed by the Required Lenders and accepted such appointment in writing within 45 days after the retiring Administrative Agent's giving of notice of resignation, then the retiring Administrative Agent shall, in consultation with the Borrower, appoint a successor Administrative Agent on behalf of the Lenders prior to the end of the 60th day from such notice from among any of the Lenders who shall have at such time a Commitment of at least $15,000,000 (an "Approved Successor"). If no Lender has a Commitment of at least $15,000,000 (or no Lender whose Commitment is at least $15,000,000 shall agree to accept such appointment), then the retiring Administrative Agent shall, in consultation with the Borrower, appoint any other Lender or any other commercial bank organized under the laws of the United States of America or any State thereof and having a combined capital and surplus of at least $100,000,000 as a successor Administrative Agent. Any appointment of a successor Administrative Agent shall be subject to the approval of the Borrower, which approval shall not be unreasonably withheld or delayed, and shall be given in any event prior to the end of the 60th day from the date of the retiring Administrative Agent's notice of resignation, provided that during any period in which either (i) a Competitive Bid Advance is outstanding, or (ii) there exists and is continuing an Event of Default, no approval from the Borrower to the appointment of an Approved Successor shall be required. Upon the acceptance of an appointment as Administrative Agent hereunder by a successor Administrative Agent and any required approval of such successor Administrative Agent by the Borrower in accordance with the terms of this Section, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent's rights, powers, privileges and duties as Administrative Agent under the Loan Documents shall be terminated. The Borrower and the Lenders shall execute such documents as shall be necessary to effect such appointment. After any retiring Administrative Agent's resignation hereunder as Administrative Agent, the provisions of the Loan Documents shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under the Loan Documents. - 89 - 96 10.10. Exculpation of Co-Documentation Agents. Neither of the Co-Documentation Agents has any rights, obligations, liabilities, responsibilities or duties under the Agreement other than those applicable to all Lenders as such. 11. OTHER PROVISIONS. 11.1. Amendments and Waivers. With the written consent of the Required Lenders, the Administrative Agent and the Borrower may, from time to time, enter into written amendments, supplements or modifications of the Loan Documents and, with the consent of the Required Lenders, the Administrative Agent on behalf of the Lenders may execute and deliver to any such parties a written instrument waiving or a consent to a departure from, on such terms and conditions as the Administrative Agent may specify in such instrument, any of the requirements of the Loan Documents or any Default or Event of Default and its consequences; provided, however, that no such amendment, supplement, modification, waiver or consent shall, without the consent of all of the Lenders: (i) change the Commitments of any Lender or the Total Commitment Amount, (ii) extend the Revolving Credit Termination Date; (iii) decrease the rate, or extend the time of payment, of interest of, or change or forgive the principal amount of, or change the requirement that payments and prepayments of principal of, and payments of interest on, the Notes be made pro rata to the Lenders on the basis of the outstanding principal amount of the Loans, (iv) amend the definition of "Required Lender", (v) amend the definition of "Applicable Facility Fee Percentage" or "Applicable Margin," (vi) release any Subsidiary Guarantor from its obligations under any Guaranty, or (vii) change the provisions of Section 2.11, 2.12, 2.13, 2.14, 2.15, 2.16, 2.17, 2.18, 3.1 or 11.1; and provided further that no change of Section 2.8 may be effected without the consent of the Swingline Lender, and no change of Section 2.9 may be effected without the consent of the Issuing Bank; and provided further that no such amendment, supplement, modification, waiver or consent shall amend, modify, waive or consent to a departure from any provision of Section 10 or otherwise change any of the rights or obligations of the Administrative Agent under the Loan Documents without the written consent of the Administrative Agent; and provided further that no such amendment, supplement, modification, waiver or consent shall, unless in writing and signed by the Designating Lender on behalf of each Designated Lender affected thereby, (a) subject such Designated Lender to any additional obligations, (b) reduce the principal of, interest on, or other amounts due with respect to, the Competitive Bid Borrowings made payable to such Designated Lender, (c) postpone any date fixed for any payment of principal of, or interest on, or other amounts due with respect to, Competitive Bid Borrowings made payable to such Designated Lender, or (d) amend the definition of Required Lenders - 90 - 97 hereunder in a manner which adversely affects the rights of such Designated Lender. The Administrative Agent shall cause a copy of each written request for such an amendment, supplement or modification delivered by the Borrower to it to be delivered to each Lender. Any such amendment, supplement, modification, waiver or consent shall apply equally to each of the Lenders and shall be binding upon the parties to the applicable agreement, the Lenders, the Administrative Agent and all future holders of the Notes. In the case of any waiver, the parties to the applicable agreement, the Lenders and the Administrative Agent shall be restored to their former position and rights under the Loan Documents, and any Default or Event of Default waived shall not extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon. 11.2. Notices. All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered by hand, or if sent by certified mail (return receipt requested), when the return receipt is signed on behalf of the party to whom such notice is given, or in the case of telecopier notice, when sent, or if sent by overnight nationwide commercial courier, the Business Day following the date such notice is deposited with said courier, and in any case addressed as follows in the case of the Borrower or the Administrative Agent, and at the Domestic Lending Office in the case of each Lender, or to such other addresses as to which the Administrative Agent may be hereafter notified by the respective parties hereto or any future holders of the Notes: The Borrower: New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas New York, New York 10036 Attention: Dean Bernstein, Senior Vice President Telephone: (212) 869-3000 Telecopy: (212) 869-3989 - 91 - 98 with a copy to: New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas New York, New York 10036 Attention: Steven F. Siegel, Esq., General Counsel Telephone: (212) 869-3000 Telecopy: (212) 302-4776 The Administrative Agent: The Bank of New York One Wall Street Agency Function Administration 18th Floor New York, New York 10286 Attention: Sandra Scaglione Agency Function Administrator Telephone: (212) 635-4695 Telecopy: (212) 635-6365 or 6366 or 6367 with a copy to: The Bank of New York One Wall Street New York, New York 10286 Attention: Rick Laudisi Vice President Telephone: (212) 635-7621 Telecopy: (212) 809-9526, except that any notice, request or demand by the Borrower to or upon the Administrative Agent, the Swingline Lender, the Issuing Bank or the Lenders pursuant to Section 2.3, 2.4, 2.8, 2.9 or 2.10 shall not be effective until received. Any party to a Loan Document may rely on signatures of the parties thereto which are transmitted by telecopier or other electronic means as fully as if originally signed. 11.3. No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising any right, remedy, power or privilege under any Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under any Loan - 92 - 99 Document preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges under the Loan Documents are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law. 11.4. Survival of Representations and Warranties. All representations and warranties made under the Loan Documents and in any document, certificate or statement delivered pursuant hereto or in connection therewith shall survive the execution and delivery of the Loan Documents. After the termination of this Agreement in accordance with its terms, without any extension thereof, the payment in full of all obligations of the Borrower under the Loan Documents and the expiration of any obligations of the Borrower hereunder which survive the termination of this Agreement, the Borrower shall have no liability to the Lenders under such representations and warranties, except that the foregoing shall not apply with respect to any claim, action or proceeding made or brought under any such representations or warranties prior to such termination or payment. 11.5. Payment of Expenses and Taxes. The Borrower agrees, promptly upon presentation of a statement or invoice therefor, and whether any Loan is made (i) to pay or reimburse each Credit Party for all of its out-of-pocket costs and expenses reasonably incurred in connection with the development, preparation, negotiation and execution of, the Loan Documents, the syndication of the loan transaction evidenced by this Agreement (whether or not such syndication is completed) and any amendment, supplement or modification hereto (whether or not executed), any documents prepared in connection therewith and the consummation of the transactions contemplated thereby, including, without limitation, the reasonable fees and disbursements of Special Counsel, (ii) to pay or reimburse each Credit Party for all of its respective costs and expenses, including, without limitation, reasonable fees and disbursements of counsel, incurred in connection with (x) any Default or Event of Default and any enforcement or collection proceedings resulting therefrom (including, without limitation, any costs incurred after the entry of judgment in an attempt to collect money due in the judgment) or in connection with the negotiation of any restructuring or "work-out" (whether consummated or not) of the obligations of the Borrower under any of the Loan Documents and (y) the enforcement of this Section, (iii) to pay, indemnify, and hold each Credit Party harmless from and against, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, the Loan Documents and any such other documents, and (iv) to pay, indemnify and hold each - 93 - 100 Credit Party and each of their respective officers, directors, employees, affiliates, agents, controlling persons and attorneys (as used in this Section, each an "Indemnified Person") harmless from and against any and all other liabilities, obligations, claims, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever (including, without limitation, reasonable counsel fees and disbursements) with respect to any claim, investigation or proceeding from any third party relating to this Agreement or the Loan Documents, including the enforcement and performance of the Loan Documents and the use of the proceeds of the Loans (all the foregoing, collectively, the "indemnified liabilities"), whether or not any such indemnified person is a party to this Agreement or the Loan Documents, and to reimburse each indemnified person for all legal and other expenses incurred in connection with investigating or defending any indemnified liabilities, and, if and to the extent that the foregoing indemnity may be unenforceable for any reason, the Borrower agrees to make the maximum payment permitted or not prohibited under applicable law; provided, however, that the Borrower shall have no obligation hereunder to pay indemnified liabilities to any Credit Party arising from (A) the gross negligence or willful misconduct of such Credit Party or (B) disputes solely between the Credit Parties and which are not related to any act or failure to act on the part of the Borrower or the failure of the Borrower to perform any of its obligations under this Agreement or the Loan Documents. Notwithstanding the foregoing, the fees and expenses referred to in clause (iv) of the preceding paragraph shall not be payable by the Borrower if (x) any such enforcement action brought by such Credit Party is dismissed, with prejudice, on the pleadings or pursuant to a motion made by the Borrower for summary judgment, and (y) if such Credit Party appeals such dismissal, such dismissal is affirmed and the time for any further appeals has expired. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 11.6. Lending Offices. Each Lender shall have the right at any time and from time to time to transfer its Loans to a different office, provided that such Lender shall promptly notify the Administrative Agent and the Borrower of any such change of office. Such office shall thereupon become such Lender's Domestic Lending Office or Eurodollar Lending Office, as the case may be, provided, however, that no such Lender shall be entitled to receive any greater amount under Sections 2.15, 2.16 or 2.18 as a result of a transfer of any such Loans to a different office of such Lender than it would be entitled to immediately prior thereto unless such claim would have arisen even if such transfer had not occurred. - 94 - 101 11.7. Successors and Assigns. (a) The Loan Documents shall be binding upon and inure to the benefit of the Borrower, the Lenders, the Issuing Bank, the Administrative Agent, all future holders of the Notes and their respective successors and assigns, except that the Borrower may not assign, delegate or transfer any of its rights or obligations under the Loan Documents without the prior written consent of the Administrative Agent and all of the Lenders. (b) Each Lender (other than a Designated Lender) shall have the right at any time, upon written notice to the Administrative Agent of its intent to do so, to sell, assign, transfer or negotiate all or any part of such Lender's rights and/or obligations under the Loan Documents (subject to paragraph (c) below) to one or more of its Affiliates, to one or more of the other Lenders (or to Affiliates of such other Lenders) or, with the prior written consent of the Borrower, the Administrative Agent and the Swingline Lender (which consent, from each of them, shall not be unreasonably withheld or delayed and shall not be required from the Borrower upon the occurrence and during the continuance of an Event of Default), to sell, assign, transfer or negotiate all or any part of such Lender's rights and obligations under the Loan Documents to any other bank, insurance company, pension fund, mutual fund or other financial institution, provided that there shall be paid to the Administrative Agent by the assigning Lender a fee (the "Assignment Fee") of $3,500. A Designated Lender shall not assign any of its Loans to any Person at any time, other than an assignment of all or part of such Loans to its Designating Lender. Simultaneously with each assignment by a Lender of all or any part of its and Revolving Credit Loans, such Lender shall assign, pursuant to the terms of the Other Credit Agreement, an equal percentage of its Commitment and Revolving Credit Loans under, and as defined in, the Other Credit Agreement. For each assignment, the parties to such assignment shall execute and deliver to the Administrative Agent for its acceptance and recording an Assignment and Assumption Agreement. Upon such execution, delivery, acceptance and recording by the Administrative Agent, from and after the effective date specified in such Assignment and Assumption Agreement, the assignee thereunder shall be a party hereto and, to the extent provided in such Assignment and Assumption Agreement, the assignor Lender thereunder shall be released from its obligations under the Loan Documents. The Borrower agrees upon written request of the Administrative Agent and at the Borrower's expense to execute and deliver (1) to such assignee, a Note, dated the effective date of such Assignment and Assumption Agreement, in an aggregate principal amount equal to the Loans assigned to, and Commitments assumed by, such assignee and (2) to such assignor Lender, a Note, dated the effective date of such Assignment and Assumption Agreement, in an aggregate principal amount equal to the balance of such assignor Lender's Loans and Commitment, if any, and each assignor Lender shall cancel and return to the Borrower its existing Note. Upon any such sale, assignment or other transfer, the Commitment Amounts set - 95 - 102 forth in Exhibit B shall be adjusted accordingly by the Administrative Agent and a new Exhibit B shall be distributed by the Administrative Agent to the Borrower and each Lender. (c) Each Lender shall maintain an equal Commitment Percentage in (i) all Revolving Credit Loans (other than Competitive Bid Borrowings) and L/C Exposure hereunder, and (ii) all Revolving Credit Loans (other than Competitive Bid Borrowings) and Term Loans under, and as defined in, the Other Credit Agreement. Accordingly, each sale, assignment, transfer or negotiation by a Lender of all or any part of its rights and/or obligations under the Loan Documents shall include an equal pro rata share of its rights and/or obligations under Loan Documents under, and as defined in, the Other Credit Agreement. (d) Each Lender may grant participations in all or any part of its Loans, its Note and its Commitment to one or more banks, insurance companies, financial institutions, pension funds or mutual funds, provided that (i) such Lender's obligations under the Loan Documents shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties to the Loan Documents for the performance of such obligations, (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under the Loan Documents, (iv) no sub-participations shall be permitted and (v) the voting rights of any holder of any participation shall be limited to decisions that only do any of the following: (A) subject the participant to any additional obligation, (B) reduce the principal of, or interest on the Notes or any fees or other amounts payable hereunder, and (C) postpone any date fixed for the payment of principal of, or interest on the Notes or any fees or other amounts payable hereunder. The Borrower acknowledges and agrees that any such participant shall for purposes of Sections 2.13, 2.14, 2.15, 2.16, and 2.18 be deemed to be a "Lender"; provided, however, the Borrower shall not, at any time, be obligated to pay any participant in any interest of any Lender hereunder any sum in excess of the sum which the Borrower would have been obligated to pay to such Lender in respect of such interest had such Lender not sold such participation. (e) If any (i) assignment is made pursuant to paragraph (b) above or (ii) any participation granted pursuant to paragraph (d) above, shall be made to any Person that is organized under the laws of any jurisdiction other than the United States of America or any State thereof, such Person shall furnish such certificates, documents or other evidence to the Borrower and the Administrative Agent, in the case of clause (i) and to the Borrower and the Lender which sold such participation in the case of clause (ii), as shall be required by Section 2.13(b) to evidence such Person's exemption from U.S. withholding taxes with respect to any payments under or pursuant to the Loan Documents because such Person is eligible for the benefits of a tax treaty which provides for a zero % rate of tax on any payments under the Loan Documents or because any such - 96 - 103 payments to such Person are effectively connected with the conduct by such Person of a trade or business in the United States. (f) No Lender shall, as between and among the Borrower, the Administrative Agent and such Lender, be relieved of any of its obligations under the Loan Documents as a result of any sale, assignment, transfer or negotiation of, or granting of participations in, all or any part of its Loans, its Commitment or its Note, except that a Lender shall be relieved of its obligations to the extent of any such sale, assignment, transfer, or negotiation of all or any part of its Loans, its Commitment or its Note pursuant to paragraph (b) above. (g) Notwithstanding anything to the contrary contained in this Section, any Lender may at any time or from time to time assign all or any portion of its rights under the Loan Documents to a Federal Reserve Bank, provided that any such assignment shall not release such assignor from its obligations thereunder. 11.8. Designated Lender. (a) Each Lender (each a "Designating Lender") may at any time designate one or more Designated Lenders to fund Competitive Bid Advances which the Designating Lender is required to fund subject to the terms of Section 2.4. No Lender shall be entitled to make more than one such designation. The parties to each such designation shall execute and deliver to the Administrative Agent, for its acceptance, a Designation Agreement. Upon its receipt of an appropriately completed Designation Agreement executed by a Designating Lender and a designee representing that it is a Designated Lender, the Administrative Agent will accept such Designation Agreement and give prompt notice thereof to the Borrower, whereupon, from and after the effective date specified in the Designation Agreement, the Designated Lender shall become a party to this Agreement with a right to make Competitive Bid Advances on behalf of its Designating Lender pursuant to Section 2.4 after the Borrower has accepted an offer to make the Competitive Bid Advance (or a portion thereof) from the Designating Lender. Each Designating Lender shall serve as the agent of the Designated Lender and shall on behalf of the Designated Lender give and receive all communications and notices and take all actions hereunder, including without limitation votes, approvals, waivers, consents and amendments under or relating to this Agreement or the other Loan Documents. Any such notice, communication, vote approval, waiver, consent or amendment shall be signed by the Designating Lender as agent for its Designated Lender. The Borrower, the Administrative Agent and the Lenders may rely thereon without any requirement that the Designated Lender sign or acknowledge the same. (b) A Designated Lender shall not make or participate in Revolving Credit Loans made as Conventional Advances or Term Loans of any Designating Lender, nor shall any Designated Lender have a Commitment or share in or be obligated under - 97 - 104 the Commitment of any Lender, it being understood that each Designated Lender shall be entitled to make only Competitive Bid Advances offered by the Designating Lender of such Designated Lender pursuant to Section 2.4(c), to the extent the offer of such Competitive Bid Advances has been accepted by the Borrower pursuant to Section 2.4(d). 11.9. Counterparts. Each Loan Document (other than the Notes) may be executed by one or more of the parties thereto on any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same document. It shall not be necessary in making proof of any Loan Document to produce or account for more than one counterpart signed by the party to be charged. A telecopied counterpart of any Loan Document or to any document evidencing, and of any an amendment, modification, consent or waiver to or of any Loan Document shall be deemed to be an originally executed counterpart. A set of the copies of the Loan Documents signed by all the parties thereto shall be deposited with each of the Borrower and the Administrative Agent. Any party to a Loan Document may rely upon the signatures of any other party thereto which are transmitted by telecopier or other electronic means to the same extent as if originally signed. 11.10. Adjustments; Set-off. (a) If any Lender (a "Benefited Lender") shall at any time receive any payment of all or any part of its Loans or participations in LC Disbursements or Swingline Loans, or interest thereon, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in Section 9.1 (h) or (i), or otherwise) in a greater proportion than any such payment to and collateral received by any other Lender in respect of such other Lender's Loans or participations in LC Disbursements or Swingline Loans, or interest thereon, such Benefited Lender shall purchase for cash from each of the other Lenders such portion of each such other Lender's Loans and participations in LC Disbursements or Swingline Loans, and shall provide each of such other Lenders with the benefits of any such collateral, or the proceeds thereof, as shall be necessary to cause such Benefited Lender to share the excess payment or benefits of such collateral or proceeds ratably with each of the Lenders, provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefited Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest. The Borrower agrees that each Lender so purchasing a portion of another Lender's Loans or participations in LC Disbursements or Swingline Loans may exercise all rights of payment (including, without limitation, rights of set-off, to the extent not prohibited by law) with respect to such portion as fully as if such Lender were the direct holder of such portion. - 98 - 105 (b) In addition to any rights and remedies of the Lenders provided by law, upon the occurrence of an Event of Default and the acceleration of the obligations owing in connection with the Loan Documents, or at any time upon the occurrence and during the continuance of an Event of Default under Section 9.1(a) or (b), each Lender shall have the right, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent not prohibited by applicable law, to set-off and apply against any indebtedness, whether matured or unmatured, of the Borrower to such Lender, any amount owing from such Lender to the Borrower, at, or at any time after, the happening of any of the above-mentioned events. To the extent not prohibited by applicable law, the aforesaid right of set-off may be exercised by such Lender against the Borrower or against any trustee in bankruptcy, custodian, debtor in possession, assignee for the benefit of creditors, receiver, or execution, judgment or attachment creditor of the Borrower, or against anyone else claiming through or against the Borrower or such trustee in bankruptcy, custodian, debtor in possession, assignee for the benefit of creditors, receivers, or execution, judgment or attachment creditor, notwithstanding the fact that such right of set-off shall not have been exercised by such Lender prior to the making, filing or issuance, or service upon such Lender of, or of notice of, any such petition, assignment for the benefit of creditors, appointment or application for the appointment of a receiver, or issuance of execution, subpoena, order or warrant. Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such set-off and application. 11.11. Lenders' Representations. Each Lender represents to the Administrative Agent that, in acquiring its Note, it is acquiring the same for its own account for the purpose of investment and not with a view to selling the same in connection with any distribution thereof, provided that the disposition of each Lender's own Property shall at all times be and remain within its control. 11.12. Indemnity. The Borrower agrees to indemnify and hold harmless each Credit Party and its affiliates, directors, officers, employees, affiliates, agents, controlling persons and attorneys (each an "Indemnified Person") from and against any loss, cost, liability, damage or expense (including the reasonable fees and disbursements of counsel of such Indemnified Person, including all local counsel hired by any such counsel) incurred by such Indemnified Person in investigating, preparing for, defending against, or providing evidence, producing documents or taking any other action in respect of, any commenced or threatened litigation, administrative proceeding or investigation under any federal securities or tax laws or any other statute of any jurisdiction, or any regulation, or at common law or otherwise, which is alleged to arise out of or is based upon: (i) any - 99 - 106 untrue statement of any material fact by the Borrower in any document or schedule executed or filed with any Governmental Authority by or on behalf of the Borrower; (ii) any omission to state any material fact required to be stated in such document or schedule, or necessary to make the statements made therein, in light of the circumstances under which made, not misleading; or (iii) any acts, practices or omissions of the Borrower or its agents relating to the use of the proceeds of any or all borrowings made by the Borrower which are alleged to be in violation of Section 2.17, or in violation of any federal securities or tax laws or of any other statute, regulation or other law of any jurisdiction applicable thereto, whether or not such Indemnified Person is a party thereto. The indemnity set forth herein shall be in addition to any other obligations, liabilities or other indemnifications of the Borrower to each Indemnified Person under the Loan Documents or at common law or otherwise, and shall survive any termination of the Loan Documents, the expiration of the Commitments and the payment of all indebtedness of the Borrower under the Loan Documents, provided that the Borrower shall have no obligation under this Section to an Indemnified Person with respect to any of the foregoing to the extent found in a final judgment of a court having jurisdiction to have resulted primarily out of the gross negligence or willful misconduct of such Indemnified Person or arising solely from claims between one such Indemnified Person and another such Indemnified Person. 11.13. Governing Law. The Loan Documents and the rights and obligations of the parties thereunder shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of New York, without regard to principles of conflict of laws. 11.14. Headings Descriptive. Section headings have been inserted in the Loan Documents for convenience only and shall not be construed to be a part thereof. 11.15. Severability. Every provision of the Loan Documents is intended to be severable, and if any term or provision thereof shall be invalid, illegal or unenforceable for any reason, the validity, legality and enforceability of the remaining provisions thereof shall not be affected or impaired thereby, and any invalidity, illegality or unenforceability in any jurisdiction shall not affect the validity, legality or enforceability of any such term or provision in any other jurisdiction. - 100 - 107 11.16. Integration. All exhibits to a Loan Document shall be deemed to be a part thereof. The Loan Documents embody the entire agreement and understanding among the Borrower, the Administrative Agent and the Lenders with respect to the subject matter thereof and supersede all prior agreements and understandings among the Borrower, the Administrative Agent and the Lenders with respect to the subject matter thereof. 11.17. Consent to Jurisdiction. The Borrower and each of the Credit Parties hereby irrevocably submit to the jurisdiction of any New York State or Federal court sitting in the City of New York over any suit, action or proceeding arising out of or relating to the Loan Documents. The Borrower and each of the Credit Parties hereby irrevocably waive, to the fullest extent permitted or not prohibited by law, any objection which any of them may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in such a court and any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum. 11.18. Service of Process. The Borrower hereby agrees that process may be served against it in any suit, action or proceeding referred to in Section 11.17 by sending the same by first class mail, return receipt requested or by overnight courier service, to the address of the Borrower set forth in Section 11.2 or in the applicable Loan Document executed by the Borrower. The Borrower hereby agrees that any such service (i) shall be deemed in every respect effective service of process upon it in any such suit, action, or proceeding, and (ii) shall to the fullest extent enforceable by law, be taken and held to be valid personal service upon and personal delivery to it. 11.19. No Limitation on Service or Suit. Nothing in the Loan Documents or any modification, waiver, consent or amendment thereto shall affect the right of the Administrative Agent or any Lender to serve process in any manner permitted by law or limit the right of the Administrative Agent or any Lender to bring proceedings against the Borrower in the courts of any jurisdiction or jurisdictions in which the Borrower may be served. 11.20. WAIVER OF TRIAL BY JURY. THE ADMINISTRATIVE AGENT, THE CO-DOCUMENTATION AGENTS, THE LENDERS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING - 101 - 108 OUT OF, UNDER OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREIN. FURTHER, THE BORROWER HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF THE ADMINISTRATIVE AGENT, THE CO-DOCUMENTATION AGENTS, THE LENDERS, OR COUNSEL TO THE ADMINISTRATIVE AGENT THE CO-DOCUMENTATION AGENTS OR THE LENDERS, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE ADMINISTRATIVE AGENT, THE CO-DOCUMENTATION AGENTS OR THE LENDERS WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION. THE BORROWER ACKNOWLEDGES THAT THE ADMINISTRATIVE AGENT, THE CO-DOCUMENTATION AGENTS, AND THE LENDERS HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, INTER ALIA, THE PROVISIONS OF THIS SECTION. 11.21. Termination After the termination of this Agreement in accordance with its terms, without any extension thereof, and the payment in full of all obligations of the Borrower under the Loan Documents (including without limitation, all principal, interest, Facility Fees and other amounts payable hereunder and under the Notes), the obligations of the Borrower hereunder (other than those which are stated herein to survive any termination of this Agreement) shall terminate, except that the foregoing shall not apply with respect to any claim, action or proceeding made or brought under any other provision of the Loan Documents prior to such termination or payment. At the request of the Borrower, each Lender whose obligations under the Notes have been fully paid shall promptly return to the Borrower its Note marked "paid" or shall deliver other evidence that such Lender has received full payment of such obligations. - 102 - 109 IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written. NEW PLAN EXCEL REALTY TRUST, INC. By: /s/ Dean Bernstein ------------------------ Dean Bernstein Senior Vice President THE BANK OF NEW YORK, as Administrative Agent, Swingline Lender, Issuing Bank and a Lender By: /s/ Frederick Laudisi ------------------------- Frederick Laudisi Vice President BANK ONE, NA as Co-Documentation Agent and a Lender By: /s/ Patricia Leung ------------------------- Name: Patricia Leung Title: Senior Vice President BANKBOSTON, N. A. as Co-Documentation Agent and a Lender By: /s/ Daniel P. Stegemoeller ------------------------- Name: Daniel P. Stegemoeller Title: Vice President 110 ARGENTARIA, CAJA POSTAL Y BANCO HIPOTECARIO S.A. By: /s/ Augusto Godoy ------------------------- Name: Augusto Godoy Title: General Manager BANK OF AMERICA, N. A. By: /s/ Thomas E. Schubert ------------------------- Name: Title: CHANG HWA COMMERCIAL BANK, LTD., NEW YORK BRANCH By: /s/ Wan-Tu Yeh ------------------------- Name: Wan-Tu Yeh Title: VP & General Manager ERSTE BANK By: /s/ Paul Judicke ------------------------- Name: Paul Judicke Title: Vice President By: /s/ John S. Runnion ------------------------- Name: John S. Runnion Title: First Vice President ISRAEL DISCOUNT BANK OF NEW YORK By: /s/ Marc G. Cooper ------------------------- Name: Marc G. Cooper Title: Vice President By: /s/ Chet Davis ------------------------- Name: Chet Davis Title: First Vice President 111 PNC BANK, N. A. By: /s/ Thomas Nastarowicz ------------------------------ Name: Thomas Nastarowicz Title: Vice President KEY BANK By: /s/ KENNETH A. MCINTYRE, JR. ------------------------------ Name: Kenneth A. Mcintyre, Jr. Title: Vice President EX-10.16 9 GUARANTY DATED NOVEMBER 17, 1999 1 EXHIBIT 10.16 FACILITY II GUARANTY GUARANTY (as the same may be amended, supplemented or otherwise modified from time to time, this "GUARANTY"), dated as of November 17, 1999, by and among each of the Subsidiaries listed on Schedule I hereto (collectively, the "SUBSIDIARY GUARANTORS"), and THE BANK OF NEW YORK, as administrative agent (in such capacity, the "ADMINISTRATIVE AGENT") on behalf of the Lenders under and as defined in the Credit Agreement (hereinafter defined). RECITALS I. Reference is made to the Credit Agreement, dated as of the date hereof, by and among NEW PLAN EXCEL REALTY TRUST, INC., a Maryland corporation (the "BORROWER"), the Lenders party thereto, the Administrative Agent, BANK ONE, NA, as a Co-Documentation Agent, and BANKBOSTON, N.A., as a Co-Documentation Agent (as the same may be amended, supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"). II. The Administrative Agent, the Co-Documentation Agents and the Lenders have made it a condition precedent to the effectiveness of the Credit Agreement that each Subsidiary Guarantor execute and deliver this Guaranty. III. Each Subsidiary Guarantor expects to derive substantial benefit from the Credit Agreement and the transactions contemplated thereby and, in furtherance thereof, has agreed to execute and deliver this Guaranty. Therefore, in consideration of the Recitals, the terms and conditions herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the Subsidiary Guarantors, the Borrower and the Administrative Agent hereby agree as follows: 1. DEFINED TERMS (a) Capitalized terms used herein which are not otherwise defined herein shall have the respective meanings ascribed thereto in the Credit Agreement. (b) When used in this Guaranty, the following capitalized terms shall have the respective meanings ascribed thereto as follows: "BORROWER OBLIGATIONS" means all present and future obligations and liabilities, whether deemed principal, interest, additional interest, fees, expenses or otherwise of the Borrower to the Administrative Agent, the Co-Documentation Agents, 2 the Swingline Lender, the Lenders and the Issuing Bank, including, without limitation, all obligations under (i) the Credit Agreement, (ii) the Notes and (iii) all other Loan Documents. "GUARANTOR OBLIGATIONS" means, with respect to each Subsidiary Guarantor, all of the obligations and liabilities of such Subsidiary Guarantor hereunder, whether fixed, contingent, now existing or hereafter arising, created, assumed, incurred or acquired. 2. GUARANTEE (a) Subject to Section 2(b), each Subsidiary Guarantor hereby absolutely, irrevocably and unconditionally guarantees the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of the Borrower Obligations. The agreements of each Subsidiary Guarantor in this Guaranty constitute a guarantee of payment, and no Credit Party shall have any obligation to enforce any Loan Document or exercise any right or remedy with respect to any collateral security thereunder by any action, including making or perfecting any claim against any Person or any collateral security for any of the Borrower Obligations prior to being entitled to the benefits of this Guaranty. The Administrative Agent may, at its option, proceed against the Subsidiary Guarantors, or any one or more of them, in the first instance, to enforce the Guarantor Obligations without first proceeding against the Borrower or any other Person, and without first resorting to any other rights or remedies, as the Administrative Agent may deem advisable. In furtherance hereof, if any Credit Party is prevented by law from collecting or otherwise hindered from collecting or otherwise enforcing any Borrower Obligation in accordance with its terms, such Credit Party shall be entitled to receive hereunder from the Subsidiary Guarantors after demand therefor, the sums which would have been otherwise due had such collection or enforcement not been prevented or hindered. (b) Notwithstanding anything to the contrary contained herein, the maximum aggregate amount of the obligations of each Subsidiary Guarantor hereunder shall not, as of any date of determination, exceed the lesser of the greatest amount that is valid and enforceable against such Subsidiary Guarantor under principles of New York State contract law and the greatest amount that would not render such Subsidiary Guarantor's liability hereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11 of the United States Code or any provisions of applicable state law (collectively, the "FRAUDULENT TRANSFER LAWS"), in each case after giving effect to all other liabilities of such Subsidiary Guarantor, contingent or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically excluding, however, any liability (A) in respect of intercompany indebtedness to the Borrower or any Affiliate or Subsidiary of the Borrower, to the extent that such intercompany indebtedness would be discharged to the extent payment is made by such Subsidiary - 2 - 3 Guarantor hereunder, and (B) under any guarantee of (1) senior unsecured indebtedness or (2) indebtedness subordinated in right of payment to any Borrower Obligation, in either case which contains a limitation as to maximum liability similar to that set forth in this Section 2(b) and pursuant to which the liability of such Subsidiary Guarantor hereunder is included in the liabilities taken into account in determining such maximum liability) and after giving effect as assets to the value (as determined under the applicable provisions of the Fraudulent Transfer Laws) of any rights to subrogation, contribution, reimbursement, indemnity or similar rights of such Subsidiary Guarantor pursuant to applicable law or any agreement providing for an equitable allocation among such Subsidiary Guarantor and other Affiliates or Subsidiaries of the Borrower of obligations arising under guarantees by such parties. (c) Each Subsidiary Guarantor agrees that the Guarantor Obligations may at any time and from time to time exceed the maximum aggregate amount of the obligations of such Subsidiary Guarantor hereunder without impairing this Guaranty or affecting the rights and remedies of any Credit Party hereunder. 3. ABSOLUTE OBLIGATION No Subsidiary Guarantor shall be released from liability hereunder unless and until the Commitments and Swingline Commitment have terminated and no Letters of Credit remain outstanding and either (i) the Borrower shall have paid in full the outstanding principal balance of the Loans, together with all accrued and unpaid interest thereon, and all other amounts then due and owing under the Loan Documents, or (ii) the Guarantor Obligations of such Subsidiary Guarantor shall have been paid in full in cash. Each Subsidiary Guarantor acknowledges and agrees that (a) no Credit Party has made any representation or warranty to such Subsidiary Guarantor with respect to the Borrower, any of its Subsidiaries, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or any other matter whatsoever, and (b) such Subsidiary Guarantor shall be liable hereunder, and such liability shall not be affected or impaired, irrespective of (A) the validity or enforceability of any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or the collectability of any of the Borrower Obligations, (B) the preference or priority ranking with respect to any of the Borrower Obligations, (C) the existence, validity, enforceability or perfection of any security interest or collateral security under any Loan Document, or the release, exchange, substitution or loss or impairment of any such security interest or collateral security, (D) any failure, delay, neglect or omission by any Credit Party to realize upon or protect any direct or indirect collateral security, indebtedness, liability or obligation, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or any of the Borrower Obligations, (E) the existence or exercise of any right of set-off by any Credit Party, (F) the existence, validity or - 3 - 4 enforceability of any other guarantee with respect to any of the Borrower Obligations, the liability of any other Person in respect of any of the Borrower Obligations, or the release of any such Person or any other guarantor of any of the Borrower Obligations, (G) any act or omission of any Credit Party in connection with the administration of any Loan Document or any of the Borrower Obligations, (H) the bankruptcy, insolvency, reorganization or receivership of, or any other proceeding for the relief of debtors commenced by or against, any Person, (I) the disaffirmance or rejection, or the purported disaffirmance or purported rejection, of any of the Borrower Obligations, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, in any bankruptcy, insolvency, reorganization or receivership, or any other proceeding for the relief of debtor, relating to any Person, (J) any law, regulation or decree now or hereafter in effect which might in any manner affect any of the terms or provisions of any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith or any of the Borrower Obligations, or which might cause or permit to be invoked any alteration in the time, amount, manner or payment or performance of any of the Borrower's obligations and liabilities (including the Borrower Obligations), (K) the merger or consolidation of the Borrower into or with any Person, (L) the sale by the Borrower of all or any part of its assets, (M) the fact that at any time and from time to time none of the Borrower Obligations may be outstanding or owing to any Credit Party, (N) any amendment or modification of, or supplement to, any Loan Document, or (O) any other reason or circumstance which might otherwise constitute a defense available to or a discharge of the Borrower in respect of its obligations or liabilities (including the Borrower Obligations) or of such Subsidiary Guarantor in respect of any of the Guarantor Obligations (other than by the performance in full thereof). 4. REPRESENTATIONS AND WARRANTIES Each of the Subsidiary Guarantors represents and warrants as to itself that all representations and warranties relating to it contained in the Credit Agreement are true and correct. 5. NOTICES Except as otherwise specifically provided herein, all notices, requests, consents, demands, waivers and other communications hereunder shall be in writing (including facsimile) and shall be given in the manner set forth in Section 11.2 of the Credit Agreement (i) in the case of the Administrative Agent, to the address set forth in Section 11.2 of the Credit Agreement, (ii) in the case of a Subsidiary Guarantor, to the address set forth in Schedule I hereto, or (iii) in the case of each party hereto, to such other addresses as to which the Administrative Agent may be hereafter notified by the respective parties hereto. - 4 - 5 6. EXPENSES Each Subsidiary Guarantor agrees that it shall, promptly after demand, pay to the Administrative Agent any and all reasonable out-of-pocket sums, costs and expenses, which any Credit Party may pay or incur defending, protecting or enforcing this Guaranty (whether suit is instituted or not), reasonable attorneys' fees and disbursements. All sums, costs and expenses which are due and payable pursuant to this Section shall bear interest, payable on demand, at the highest rate then payable on the Borrower Obligations. 7. REPAYMENT IN BANKRUPTCY, ETC. If, at any time or times subsequent to the payment of all or any part of the Borrower Obligations or the Guarantor Obligations, any Credit Party shall be required to repay any amounts previously paid by or on behalf of the Borrower or any Subsidiary Guarantor in reduction thereof by virtue of an order of any court having jurisdiction in the premises, including as a result of an adjudication that such amounts constituted preferential payments or fraudulent conveyances, the Subsidiary Guarantors unconditionally agree to pay to the Administrative Agent, within 10 days after demand, a sum in cash equal to the amount of such repayment, together with interest on such amount from the date of such repayment by such Credit Party to the date of payment to the Administrative Agent at the applicable after-maturity rate set forth in the Credit Agreement. 8. MISCELLANEOUS (a) Except as otherwise expressly provided in this Guaranty, each Subsidiary Guarantor hereby waives presentment, demand for payment, notice of default, nonperformance and dishonor, protest and notice of protest of or in respect of this Guaranty, the other Loan Documents and the Borrower Obligations, notice of acceptance of this Guaranty and reliance hereupon by any Credit Party, and the incurrence of any of the Borrower Obligations, notice of any sale of collateral security or any default of any sort. (b) No Subsidiary Guarantor is relying upon any Credit Party to provide to such Subsidiary Guarantor any information concerning the Borrower or any of its Subsidiaries, and each Subsidiary Guarantor has made arrangements satisfactory to such Subsidiary Guarantor to obtain from the Borrower on a continuing basis such information concerning the Borrower and its Subsidiaries as such Subsidiary Guarantor may desire. (c) Each Subsidiary Guarantor agrees that any statement of account with respect to the Borrower Obligations from any Credit Party to the Borrower which binds - 5 - 6 the Borrower shall also be binding upon such Subsidiary Guarantor, and that copies of said statements of account maintained in the regular course of or such Credit Party's business may be used in evidence against such Subsidiary Guarantor in order to establish its Guarantor Obligations. (d) Each Subsidiary Guarantor acknowledges that it has received a copy of the Loan Documents and has approved of the same. In addition, each Subsidiary Guarantor acknowledges having read each Loan Document and having had the advice of counsel in connection with all matters concerning its execution and delivery of this Guaranty. (e) This Guaranty shall be binding upon each Subsidiary Guarantor and its successors and insure to the benefit of, and be enforceable by the Administrative Agent, Lenders and their respective successors, transferees and assigns. No Subsidiary Guarantor may assign any right, or delegate any duty, it may have under this Guaranty. (f) Subject to the limitations set forth in Section 2(b), the Guarantor Obligations shall be joint and several. (g) This Guaranty is the "Guaranty" referred to in the Credit Agreement, and is subject to, and should be construed in accordance with, the provisions thereof. Each of the parties hereto acknowledges and agrees that the following are made applicable to this Guaranty and all such provisions are incorporated by reference herein as if fully set forth herein, including Sections 1 (Definitions), 2.13 (Taxes; Net Payments), 11.1 (Amendments and Waivers), 11.3 (No Waiver; Cumulative Remedies), 11.5 (Payment of Expenses and Taxes), 11.7 (Successors and Assigns), 11.9 (Counterparts), 11.12 (Indemnity), 11.13 (Governing Law), 11.14 (Headings Descriptive), 11.15 (Severability), 11.16 (Integration), 11.17 (Consent to Jurisdiction), 11.18 (Service of Process), 11.19 (No Limitation on Service or Suit) and 11.20 (WAIVER OF TRIAL BY JURY). (h) Each Subsidiary Guarantor agrees that (i) the execution and delivery of a Guaranty by any Required Additional Guarantor after the date hereof shall not affect the obligations of the Subsidiary Guarantors hereunder, and (ii) the Subsidiary Guarantors and each such Required Additional Guarantor shall, subject to Section 2(b), be jointly and severally liable for all of the Borrower Obligations. (i) With respect to New Plan Realty Trust, this Guaranty has been negotiated, executed and delivered on behalf of the undersigned by the trustees or officers thereof in their representative capacity under the Declaration of Trust, and not individually, and bind only the trust estate of the undersigned, and no trustee, officer, employee, agent or shareholder of the undersigned shall be bound or held to any personal liability or responsibility in connection with the agreements, obligations and - 6 - 7 undertakings of the undersigned hereunder, and any person or entity dealing with the undersigned in connection therewith shall look only to the trust estate for the payment of any claim or for the performance of any agreement, obligation or undertaking thereunder. The Administrative Agent and each Lender hereby acknowledge and agree that each agreement and other document executed by the undersigned in accordance with or in respect of this transaction shall be deemed and treated to include in all respects and for all purposes the foregoing exculpatory provision. - 7 - 8 FACILITY II IN EVIDENCE of the agreement by the parties hereto to the terms and conditions herein contained, each such party has caused this Subsidiary Guarantee to be duly executed on its behalf. NEW PLAN REALTY TRUST By: /s/ Dean Bernstein ---------------------------------- Name: ---------------------------------- Title: ---------------------------------- EXCEL REALTY TRUST - ST, INC. By: /s/ Dean Bernstein ---------------------------------- Name: ---------------------------------- Title: ---------------------------------- THE BANK OF NEW YORK, as Administrative Agent By: /s/ Frederick Laudisi ---------------------------------- Name: Frederick Laudisi ---------------------------------- Title: Vice President ---------------------------------- 9 FACILITY II SCHEDULE I TO SUBSIDIARY GUARANTY SUBSIDIARY GUARANTORS UNDER GUARANTY DATED AS OF NOVEMBER 17, 1999
Jurisdiction of Incorporation or Address for Name Formation Notices - ------------ -------------------------------- -------------------------------- New Plan Massachusetts 1120 Avenue of the Americas Realty Trust New York, New York 10036 Attention: Dean Bernstein Telephone: (212) 869-3000 Telecopy: (212) 869-3989 Excel Realty Delaware 1120 Avenue of the Americas Trust - ST, Inc. New York, New York 10036 Attention: Dean Bernstein Telephone: (212) 869-3000 Telecopy: (212) 869-3989
EX-10.36 10 EMPLOYMENT AGREEMENT 1 EXHIBIT 10.36 EMPLOYMENT AGREEMENT AGREEMENT, dated as of September 25, 1998, by and between Excel Realty Trust, Inc., a Maryland corporation (the "Company"), and James DeCicco ("Executive"). RECITALS A. Executive is currently Senior Vice President-Leasing of New Plan Realty Trust, a Massachusetts business trust ("New Plan"). B. The Company, a wholly owned subsidiary of the Company ("Sub"), and New Plan have entered into an Agreement and Plan of Merger (as amended, the "Merger Agreement"), pursuant to which Sub shall merge with and into New Plan with New Plan surviving as a wholly-owned subsidiary of the Company (the "Merger"). C. The Company desires to employ Executive, effective as of the time the Merger is consummated (the "Effective Time"), on the terms and conditions set forth in this Agreement, and Executive desires to be so employed. AGREEMENT IN CONSIDERATION of the premises and the mutual covenants set forth below, the parties hereby agree as follows: 1. Employment. The Company hereby agrees to employ Executive as Senior Vice President-Leasing, and Executive hereby accepts such employment, on the terms and conditions hereinafter set forth. Notwithstanding the employment of Executive by the Company, the Company shall be entitled to pay Executive from the payroll of New Plan. 2. Term. The period of employment of Executive by the Company hereunder (the "Employment Period") shall commence on the Effective Time of the Merger (the "Commencement Date") and shall continue through December 31, 2001; provided, that commencing on January 1, 2002, and on each anniversary date thereafter, the Employment Period shall automatically be extended for one (1) additional year unless either party gives written notice not to extend this Agreement prior to six (6) months before such automatic extension would be effectuated. The Employment Period may be sooner terminated by either party in accordance with Section 6 of this Agreement. Employment hereunder and entering into this Agreement shall not be deemed to constitute termination of employment of Executive with New Plan and shall not trigger any obligations or result in the loss of any benefits resulting from an employment termination. Therefore, without limiting the generality of the foregoing, any promissory note(s) of Executive payable 2 to New Plan shall not be accelerated as a result of this Agreement or any action taken in accordance with the terms thereof. 3. Position and Duties. During the Employment Period, Executive shall serve as Senior Vice President-Leasing of the Company. Executive shall have those powers and duties normally associated with the position of a Senior Vice President and such other powers and duties as may be prescribed by the Board of Directors of the Company (the "Board"). Executive shall devote such time, attention and energies to Company affairs as are necessary to fully perform his duties (other than absences due to illness or vacation) for the Company. Notwithstanding the above, Executive shall be permitted, to the extent such activities do not materially and adversely affect the ability of Executive to fully perform his duties and responsibilities hereunder, to (i) manage Executive's personal, financial and legal affairs, and (ii) serve on civic or charitable boards or committees. 4. Place of Performance. The principal place of employment of Executive shall be at the Company's corporate offices in New York, New York. 5. Compensation and Related Matters. (a) Salary. During the Employment Period, the Company shall pay Executive an annual base salary of $175,000 ("Base Salary"). Executive's Base Salary shall be paid in approximately equal installments in accordance with the Company's customary payroll practices. If Executive's Base Salary is increased by the Company, such increased Base Salary shall then constitute the Base Salary for all purposes of this Agreement. (b) Bonus. The Board's compensation committee (the "Compensation Committee") shall review Executive's performance at least annually during each year of the Employment Period and cause the Company to award Executive a cash bonus of up to 50% of his Base Salary which the Compensation Committee shall reasonably determine as fairly compensating and rewarding Executive for services rendered to the Company and/or as an incentive for continued service to the Company, but in no event shall Executive's aggregate bonus and Base Salary for the first full calendar year after the Effective Time be less than the aggregate of Executive's New Plan salary immediately prior to the Effective Time and Executive's 1997 New Plan bonus. The amount of Executive's cash bonus shall be determined in the reasonable discretion of the Compensation Committee and shall be dependent upon, among other things, the achievement of certain performance levels by the Company, including, without limitation, growth in funds from operations, and Executive's performance and contribution to increasing the funds from operations. (c) Expenses. The Company shall promptly reimburse Executive for all reasonable business expenses upon the presentation of reasonably itemized - 2 - 3 statements of such expenses in accordance with the Company's policies and procedures now in force or as such policies and procedures may be modified with respect to all senior executive officers of the Company. (d) Vacation. Executive shall be entitled to the number of weeks of vacation per year provided to the Company's senior executive officers, but in no event less than four (4) weeks annually. (e) Welfare, Pension and Incentive Benefit Plans. During the Employment Period, Executive (and his spouse and dependents to the extent provided therein) shall be entitled to participate in and be covered under all the welfare benefit plans or programs maintained by the Company from time to time for the benefit of its senior executives including, without limitation, all medical, hospitalization, dental, accidental death and dismemberment and travel accident insurance plans and programs. In addition, Executive shall be entitled to receive the most extensive disability coverage provided by the Company to any other senior executive officer of the Company. In addition, during the Employment Period, Executive shall be eligible to participate in all pension, retirement, savings and other employee benefit plans and programs maintained from time to time by the Company for the benefit of its senior executives, or any annual incentive or long-term performance plans. With respect to each such employee benefit plan, program, policy or arrangement, service with New Plan or any of its subsidiaries (as applicable) shall be included for purposes of determining eligibility to participate (including waiting periods, and without being subject to any entry date requirement after the waiting period has been satisfied), vesting (as applicable) and entitlement to benefits. The medical plan or plans maintained by the Company after the Effective Time shall waive all limitations as to pre-existing conditions, exclusions and waiting periods with respect to participation and coverage requirements. With respect to vacation benefits provided by the Company, the vacation benefit of Executive shall include all hours of accrued but unused vacation and sick time hours, respectively, with New Plan or its affiliates. (f) During the Employment Period, the Company shall provide Executive with the use of an automobile (including the payment of vehicle insurance) substantially comparable to the automobile currently provided to Executive by New Plan; however, at the Company's option, Company may in lieu thereof provide Executive with an automobile allowance in an amount sufficient for Executive to have the use of (and pay vehicle insurance on, if not so provided by the Company) a vehicle substantially comparable to the automobile currently provided to Executive by New Plan. 6. Termination. Executive's employment hereunder may be terminated during the Employment Period under the following circumstances: - 3 - 4 (a) Death. Executive's employment hereunder shall terminate upon his death. (b) Disability. If, as a result of Executive's incapacity due to physical or mental illness, Executive shall have been substantially unable to perform his duties hereunder for an entire period of six (6) consecutive months, and within thirty (30) days after written Notice of Termination (as defined in Section 7(a)) is given after such six (6) month period, Executive shall not have returned to the substantial performance of his duties on a full-time basis, the Company shall have the right to terminate Executive's employment hereunder for "Disability", and such termination in and of itself shall not be, nor shall it be deemed to be, a breach of this Agreement. (c) Cause. The Company shall have the right to terminate Executive's employment for Cause, and such termination in and of itself shall not be, nor shall it be deemed to be, a breach of this Agreement. For purposes of this Agreement, the Company shall have "Cause" to terminate Executive's employment upon Executive's: (i) conviction of, or plea of guilty or nolo contendere to, a felony; or (ii) willful and continued failure to use reasonable best efforts to substantially perform his duties hereunder (other than such failure resulting from Executive's incapacity due to physical or mental illness or subsequent to the issuance of a Notice of Termination by Executive for Good Reason (as defined in Section 6(d)) after demand for substantial performance is delivered by the Company in writing that specifically identifies the manner in which the Company believes Executive has not used reasonable best efforts to substantially perform his duties; or (iii) willful misconduct (including, but not limited to, a willful breach of the provisions of Section 10) that is materially economically injurious to the Company or to any entity in control of, controlled by or under common control with the Company ("Affiliate"). For purposes of this Section 6(c), no act, or failure to act, by Executive shall be considered "willful" unless committed in bad faith and without a reasonable belief that the act or omission was in the best interests of the Company or any Affiliates thereof; provided, however, that the willful requirement outlined in paragraphs (ii) or (iii) above shall be deemed to have occurred if the Executive's action or non-action continues for more than ten (10) days after Executive has received written notice of the inappropriate action or non-action. Cause shall not exist under paragraph (ii) or (iii) above unless and until the Company has delivered to Executive a copy of a resolution duly adopted by a majority of the Board - 4 - 5 (excluding Executive for purposes of determining such majority) at a meeting of the Board called and held for such purpose (after reasonable (but in no event less than thirty (30) days) notice to Executive and an opportunity for Executive, together with his counsel, to be heard before the Board), finding that in the good faith opinion of the Board, Executive was guilty of the conduct set forth in paragraph (ii) or (iii) and specifying the particulars thereof in detail. This Section 6(c) shall not prevent Executive from challenging in any court of competent jurisdiction the Board's determination that Cause exists or that Executive has failed to cure any act (or failure to act) that purportedly formed the basis for the Board's determination. (d) Good Reason. Executive may terminate his employment for "Good Reason" within thirty (30) days after Executive has actual knowledge of the occurrence, without the written consent of Executive, of one of the following events that has not been cured within thirty (30) days after written notice thereof has been given by Executive to the Company; provided, however, that with respect to Section 6(d) the Company shall have the right to challenge in any court of competent jurisdiction the Executive's determination that he has the right to terminate his employment for "Good Reason.": (i) the termination of the Employment Agreement between Arnold Laubich, the Chief Executive Officer of the Company as of the Effective Time, and the Company dated as of May 14, 1998, pursuant to Section 6(d) thereof by Laubich or by the Company without Cause; (ii) the assignment to Executive of duties materially and adversely inconsistent with Executive's status as a Senior Vice President of the Company or a material and adverse alteration in the nature of Executive's duties and/or responsibilities, reporting obligations, titles or authority; (iii) a reduction by the Company in Executive's Base Salary or a failure by the Company to pay any such amounts when due; (iv) the relocation of the Company's executive offices or Executive's own office location to a location that is more than fifty (50) miles from New York, New York; (v) any purported termination of Executive's employment for Cause which is not effected pursuant to the procedures of Section 6(c) (and for purposes of this Agreement, no such purported termination shall be effective); (vi) the Company's failure to substantially provide any material employee benefits due to be provided to Executive; - 5 - 6 (vii) the Company's failure to provide in all material respects the indemnification set forth in Section 11 of this Agreement; (viii) a Change in Control (as defined below) of the Company; or (ix) Failure of the Company to provide, by giving appropriate written notice to Executive, for two automatic one (1) year renewals following the replacement of Arnold Laubich as Chief Executive Officer of the Company. Executive's right to terminate his employment hereunder for Good Reason shall not be affected by his incapacity due to physical or mental illness. Executive's continued employment during the thirty (30) day period referred to above in this paragraph (d) shall not constitute consent to, or a waiver of rights with respect to, any act or failure to act constituting Good Reason hereunder. For purposes of this Agreement, a "Change in Control" of the Company means the occurrence of one of the following events: (1) individuals who, on the Commencement Date, constitute the Board (the "Incumbent Directors") cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to the Commencement Date whose election or nomination for election was approved by a vote of a majority of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without objection to such nomination) shall be an Incumbent Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to directors or as a result of any other actual or threatened solicitation of proxies by or on behalf of any person other than the Board shall be an Incumbent Director; (2) any "person" (as such term is defined in Section 3(a)(9) of the Securities Exchange Act of 1934 (the "Exchange Act") and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes, after the Commencement Date, a "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 30% or more of the combined voting power of the Company's then outstanding securities eligible to vote for the election of the Board (the "Company Voting Securities"); provided, however, that an event described in this paragraph (2) shall not be deemed to be a Change in Control if any of following becomes such a beneficial owner: (A) the Company or any majority-owned subsidiary (provided, that this exclusion applies solely to the ownership levels of the Company or the majority-owned subsidiary, (B) any tax-qualified, broad-based employee benefit plan sponsored or maintained by - 6 - 7 the Company or any majority-owned subsidiary, (C) any underwriter temporarily holding securities pursuant to an offering of such securities, (D) any person pursuant to a Non-Qualifying Transaction (as defined in paragraph (3)), or (E) Executive or any group of persons including Executive (or any entity controlled by Executive or any group of persons including Executive); (3) the consummation of a merger, consolidation, share exchange or similar form of transaction involving the Company or any of its subsidiaries, or the sale of all or substantially all of the Company's assets (a "Business Transaction"), unless immediately following such Business Transaction (i) more than 50% of the total voting power of the entity resulting from such Business Transaction or the entity acquiring the Company's assets in such Business Transaction (the "Surviving Corporation") is beneficially owned, directly or indirectly, by the Company's shareholders immediately prior to any such Business Transaction, and (ii) no person (other than the persons set forth in clauses (A), (B), or (C) of paragraph (2) above or any tax-qualified, broad-based employee benefit plan of the Surviving Corporation or its Affiliates) beneficially owns, directly or indirectly, 30% or more of the total voting power of the Surviving Corporation (a "Non-Qualifying Transaction"); or (4) Board approval of a liquidation or dissolution of the Company, unless the voting common equity interests of an ongoing entity (other than a liquidating trust) are beneficially owned, directly or indirectly, by the Company's shareholders in substantially the same proportions as such shareholders owned the Company's outstanding voting common equity interests immediately prior to such liquidation and such ongoing entity assumes all existing obligations of the Company to Executive under this Agreement and the Stock Option Agreements pursuant to which the Stock Options were granted. (e) Without Good Reason. Executive shall have the right to terminate his employment hereunder without Good Reason by providing the Company with a Notice of Termination, and such termination shall not in and of itself be, nor shall it be deemed to be, a breach of this Agreement. 7. Termination Procedure. (a) Notice of Termination. Any termination of Executive's employment by the Company or by Executive during the Employment Period (other than termination pursuant to Section 6(a)) shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 14. For purposes of this Agreement, a "Notice of Termination" shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and - 7 - 8 shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of Executive's employment under the provision so indicated. (b) Date of Termination. "Date of Termination" shall mean (i) if Executive's employment is terminated by his death, the date of his death, (ii) if Executive's employment is terminated pursuant to Section 6(b), thirty (30) days after Notice of Termination (provided that Executive shall not have returned to the substantial performance of his duties on a full-time basis during such thirty (30) day period), and (iii) if Executive's employment is terminated for any other reason, the date on which a Notice of Termination is given or any later date (within thirty (30) days after the giving of such notice) set forth in such Notice of Termination. 8. Compensation Upon Termination or During Disability. In the event Executive is disabled or his employment terminates during the Employment Period, the Company shall provide Executive with the payments and benefits set forth below. Executive acknowledges and agrees that the payments set forth in this Section 8 constitute liquidated damages for termination of his employment during the Employment Period. (a) Termination By Company Without Cause or by Executive for Good Reason. If Executive's employment is terminated by the Company without Cause or by Executive for Good Reason: (i) the Company shall pay to Executive (A) his Base Salary and accrued vacation pay through the Date of Termination, as soon as practicable following the Date of Termination, and (B) a payment equal to two times Executive's average total compensation (Base Salary plus bonus) for the two (2) preceding fiscal years of the Company ending prior to termination as soon as practicable following the Date of Termination (for this purpose Executive's compensation earned with New Plan shall be used to the extent necessary); provided, however, if the Executive has previously given a notice not to extend the Employment Period pursuant to Section 2, the payment referred to in this subsection (i) shall not be made; (ii) the Company shall maintain in full force and effect, for the continued benefit of Executive, his spouse and his dependents for a period of three (3) years following the Date of Termination the medical, hospitalization, dental, and life insurance programs in which Executive, his spouse and his dependents were participating immediately prior to the Date of Termination at the level in effect and upon substantially the same terms and conditions (including without limitation contributions required by Executive for such benefits) as existed immediately prior to the Date of Termination; provided, that if Executive, his spouse or his dependents cannot continue to participate in the Company programs providing such benefits, the Company shall arrange to provide Executive, his spouse and his dependents - 8 - 9 with the economic equivalent of such benefits which they otherwise would have been entitled to receive under such plans and programs ("Continued Benefits"), provided, that such Continued Benefits shall terminate on the date or dates Executive receives substantially equivalent coverage and benefits, without waiting period or pre-existing condition limitations, under the plans and programs of a subsequent employer (such coverage and benefits to be determined on a coverage-by-coverage, or benefit-by-benefit, basis); and (iii) the Company shall reimburse Executive pursuant to Section 5(c) for reasonable expenses incurred, but not paid prior to such termination of employment; (iv) Executive shall be entitled to any other rights, compensation and/or benefits as may be due to Executive in accordance with the terms and provisions of any agreements, plans or programs of the Company; (v) all stock options and other pension or employment benefits granted to Executive more than one year prior to the Date of Termination shall fully vest as of the Date of Termination (inclusive of any granted to Executive by New Plan prior to the Effective Time); (vi) the Company shall forgive and cancel all loans made by the Company or any Affiliate to Executive during the Employment Period, if any, and shall take all actions and execute all documents necessary to evidence the forgiveness and cancellation of such loans; and (vii) the Company shall eliminate any and all restrictions on Executive's ability either to engage in any activities, directly or indirectly, in competition with the Company (including, without limitation, the restrictions set forth in Section 10(c) of this Agreement but not the restrictions set forth in Section 10(a) and (b)), or to make any investment in competition with the Company, and shall execute all documents necessary or reasonably requested by Executive to reflect such elimination of restrictions. The foregoing notwithstanding, the total of the severance payments payable under this Section 8(a) shall be reduced to the extent the payment of such amounts would cause Executive's total termination benefits (as determined by Executive's tax advisor) to constitute an "excess" parachute payment under Section 280G of the Internal Revenue Code of 1986, as amended (the "Code") and by reason of such excess parachute payment Executive would be subject to an excise tax under Section 4999(a) of the Code, but only if Executive determines that the after-tax value of the termination benefits calculated with the foregoing restriction exceed those calculated without the foregoing restriction. - 9 - 10 (b) Cause or By Executive Without Good Reason. If Executive's employment is terminated by the Company for Cause or by Executive (other than for Good Reason): (i) the Company shall pay Executive his Base Salary and, to the extent required by law or the Company's vacation policy, his accrued vacation pay through the Date of Termination, as soon as practicable following the Date of Termination; and (ii) the Company shall reimburse Executive pursuant to Section 5(c) for reasonable expenses incurred, but not paid prior to such termination of employment, unless such termination resulted from a misappropriation of Company funds; and (iii) Executive shall be entitled to any other rights, compensation and/or benefits as may be due to Executive in accordance with the terms and provisions of any agreements, plans or programs of the Company. (c) Disability. During any period that Executive fails to perform his duties hereunder as a result of incapacity due to physical or mental illness ("Disability Period"), Executive shall continue to receive his full Base Salary set forth in Section 5(a) until his employment is terminated pursuant to Section 6(b). In the event Executive's employment is terminated for Disability pursuant to Section 6(b): (i) the Company shall pay to Executive (A) his Base Salary and accrued vacation pay through the Date of Termination, as soon as practicable following the Date of Termination, and (B) continued Base Salary (as provided for in Section 5(a)) and Continued Benefits for the longer of (i) six (6) months or (ii) the date on which Executive becomes entitled to long-term disability benefits under the applicable plan or program of the Company paying the benefits described in Section 5(h), up to a maximum of three (3) years of Base Salary continuation; and (ii) the Company shall reimburse Executive pursuant to Section 5(c) for reasonable expenses incurred, but not paid prior to such termination of employment; and (iii) Executive shall be entitled to any other rights, compensation and/or benefits as may be due to Executive in accordance with the terms and provisions of any agreements, plans or programs of the Company. - 10 - 11 (d) Death. If Executive's employment is terminated by his death: (i) the Company shall pay in a lump sum to Executive's beneficiary, legal representatives or estate, as the case may be, Executive's Base Salary through the Date of Termination and one (1) times Executive's annual rate of Base Salary, and shall provide Executive's spouse and dependents with Continued Benefits for one (1) year; (ii) the Company shall reimburse Executive's beneficiary, legal representatives, or estate, as the case may be, pursuant to Section 5(c) for reasonable expenses incurred, but not paid prior to such termination of employment; and (iii) Executive's beneficiary, legal representatives or estate, as the case may be, shall be entitled to any other rights, compensation and benefits as may be due to any such persons or estate in accordance with the terms and provisions of any agreements, plans or programs of the Company. (e) Failure to Extend. Subject to Section 6(d)(ix), a failure to extend the Agreement pursuant to Section 2 by either party shall not be treated as a termination of Executive's employment for purposes of this Agreement. 9. Mitigation. Executive shall not be required to mitigate amounts payable under this Agreement by seeking other employment or otherwise, and there shall be no offset against amounts due Executive under this Agreement on account of subsequent employment. Additionally, amounts owed to Executive under this Agreement shall not be offset by any claims the Company may have against Executive, and the Company's obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any other circumstances, including, without limitation, any counterclaim, recoupment, defense or other right which the Company may have against Executive or others. 10. Confidential Information, Ownership of Documents; Non-Competition. (a) Confidential Information. Executive shall hold in a fiduciary capacity for the benefit of the Company all trade secrets and confidential information, knowledge or data relating to the Company and its businesses and investments, which shall have been obtained by Executive during Executive's employment by the Company and which is not generally available public knowledge (other than by acts by Executive in violation of this Agreement). Except as may be required or appropriate in connection with his carrying out his duties under this Agreement, Executive shall not, without the prior written consent of the Company or as may otherwise be required by law or any legal process, or as is necessary in connection with any adversarial proceeding against the Company (in which case Executive shall use his reasonable best efforts in cooperating with the Company in - 11 - 12 obtaining a protective order against disclosure by a court of competent jurisdiction), communicate or divulge any such trade secrets, information, knowledge or data to anyone other than the Company and those designated by the Company or on behalf of the Company in the furtherance of its business or to perform duties hereunder. (b) Removal of Documents; Rights to Products. All records, files, drawings, documents, models, equipment, and the like relating to the Company's business, which Executive has control over shall not be removed from the Company's premises without its written consent, unless such removal is in the furtherance of the Company's business or is in connection with Executive's carrying out his duties under this Agreement and, if so removed, shall be returned to the Company promptly after termination of Executive's employment hereunder, or otherwise promptly after removal if such removal occurs following termination of employment. Executive shall assign to the Company all rights to trade secrets and other products relating to the Company's business developed by him alone or in conjunction with others at any time while employed by the Company. (c) Protection of Business. During the Employment Period and until the first anniversary of Executive's Date of Termination (but only in the event Executive is terminated by the Company for Cause or Executive terminates employment without Good Reason), the Executive will not (i) engage, anywhere within the geographical areas in which the Company or any of its Affiliates (the "Designated Entities") are conducting their business operations or providing services as of the Date of Termination, in any business which is being engaged in by the Designated Entities as of the Date of Termination or pursue or attempt to develop any project known to Executive and which the Designated Entities are pursuing, developing or attempting to develop as of the Date of Termination, unless such project has been inactive for over nine (9) months (a "Project"), directly or indirectly, alone, in association with or as a shareholder, principal, agent, partner, officer, director, employee or consultant of any other organization, (ii) divert to any entity which is engaged in any business conducted by the Designated Entities in the same geographic area as the Designated Entities, any Project or any customer of any of the Designated Entities, or (iii) solicit any officer, employee (other than secretarial staff) or consultant of any of the Designated Entities to leave the employ of any of the Designated Entities. Notwithstanding the preceding sentence, Executive shall not be prohibited from owning less than three (3%) percent of any publicly traded corporation, whether or not such corporation is in competition with the Company, and Executive shall not be prohibited from owning equity securities of, and acting as an officer and director of, Legacy. If, at any time, the provisions of this Section 10(c) shall be determined to be invalid or unenforceable, by reason of being vague or unreasonable as to area, duration or scope of activity, this Section 10(c) shall be considered divisible and shall become and be immediately amended to only such area, duration and scope of activity as shall be determined to be reasonable and enforceable by the court or other body having jurisdiction over the matter, and Executive agrees that this Section 10(c) as so amended shall be - 12 - 13 valid and binding as though any invalid or unenforceable provision had not been included herein. (d) Injunctive Relief. In the event of a breach or threatened breach of this Section 10, Executive agrees that the Company shall be entitled to injunctive relief in a court of appropriate jurisdiction to remedy any such breach or threatened breach, Executive acknowledging that damages would be inadequate and insufficient. (e) Continuing Operation. Except as specifically provided in this Section 10, the termination of Executive's employment or of this Agreement shall have no effect on the continuing operation of this Section 10. 11. Indemnification. (a) General. The Company agrees that if Executive is made a party or a threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative (a "Proceeding"), by reason of the fact that Executive is or was a trustee, director or officer of the Company or any subsidiary of the Company or is or was serving at the request of the Company or any subsidiary as a trustee, director, officer, member, employee or agent of another corporation or a partnership, joint venture, trust or other enterprise, including, without limitation, service with respect to employee benefit plans, whether or not the basis of such Proceeding is alleged action in an official capacity as a trustee, director, officer, member, employee or agent while serving as a trustee, director, officer, member, employee or agent, Executive shall be indemnified and held harmless by the Company to the fullest extent authorized by Maryland law, as the same exists or may hereafter be amended, against all Expenses incurred or suffered by Executive in connection therewith, and such indemnification shall continue as to Executive even if Executive has ceased to be an officer, director, trustee or agent, or is no longer employed by the Company and shall inure to the benefit of his heirs, executors and administrators. (b) Expenses. As used in this Agreement, the term "Expenses" shall include, without limitation, damages, losses, judgments, liabilities, fines, penalties, excise taxes, settlements, and costs, attorneys' fees, accountants' fees, and disbursements and costs of attachment or similar bonds, investigations, and any expenses of establishing a right to indemnification under this Agreement. (c) Enforcement. If a claim or request under this Agreement is not paid by the Company or on its behalf, within thirty (30) days after a written claim or request has been received by the Company, Executive may at any time thereafter bring suit against the Company to recover the unpaid amount of the claim or request and if successful in whole or in part, Executive shall be entitled to be paid also the expenses of prosecuting such suit. All obligations for indemnification - 13 - 14 hereunder shall be subject to, and paid in accordance with, applicable Maryland law. (d) Partial Indemnification. If Executive is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any Expenses, but not, however, for the total amount thereof, the Company, shall nevertheless indemnify Executive for the portion of such Expenses to which Executive is entitled. (e) Advances of Expenses. Expenses incurred by Executive in connection with any Proceeding shall be paid by the Company in advance upon request of Executive that the Company pay such Expenses; but, only in the event that Executive shall have delivered in writing to the Company (i) an undertaking to reimburse the Company for Expenses with respect to which Executive is not entitled to indemnification and (ii) an affirmation of his good faith belief that the standard of conduct necessary for indemnification by the Company has been met. (f) Notice of Claim. Executive shall give to the Company notice of any claim made against him for which indemnification will or could be sought under this Agreement. In addition, Executive shall give the Company such information and cooperation as it may reasonably require and as shall be within Executive's power and at such times and places as are convenient for Executive. (g) Defense of Claim. With respect to any Proceeding as to which Executive notifies the Company of the commencement thereof: (i) The Company will be entitled to participate therein at its own expense; and (ii) Except as otherwise provided below, to the extent that it may wish, the Company will be entitled to assume the defense thereof, with counsel reasonably satisfactory to Executive, which in the Company's sole discretion may be regular counsel to the Company and may be counsel to other officers and directors of the Company or any subsidiary. Executive also shall have the right to employ his own counsel in such action, suit or proceeding if he reasonably concludes that failure to do so would involve a conflict of interest between the Company and Executive, and under such circumstances the fees and expenses of such counsel shall be at the expense of the Company. (iii) The Company shall not be liable to indemnify Executive under this Agreement for any amounts paid in settlement of any action or claim effected without its written consent. The Company shall not settle any action or claim in any manner which would impose any penalty or limitation on Executive without Executive's written consent. Neither the Company nor - 14 - 15 Executive will unreasonably withhold or delay their consent to any proposed settlement. (h) Non-exclusivity. The right to indemnification and the payment of expenses incurred in defending a Proceeding in advance of its final disposition conferred in this Section 11 shall not be exclusive of any other right which Executive may have or hereafter may acquire under any statute, provision of the declaration of trust or certificate of incorporation or by-laws of the Company or any subsidiary, agreement, vote of shareholders or disinterested directors or trustees or otherwise. 12. Legal Fees and Expenses. If any contest or dispute shall arise between the Company and Executive regarding any provision of this Agreement, the Company shall reimburse Executive for all legal fees and expenses reasonably incurred by Executive in connection with such contest or dispute, but only if Executive is successful in respect of substantially all of Executive's claims brought and pursued in connection with such contest or dispute. Such reimbursement shall be made as soon as practicable following the final resolution of such contest or dispute to the extent the Company receives reasonable written evidence of such fees and expenses. 13. Successors; Binding Agreement. (a) Company's Successors. No rights or obligations of the Company under this Agreement may be assigned or transferred except that the Company will require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place. As used in this Agreement, "Company" shall mean the Company as herein before defined and any successor to its business and/or assets (by merger, purchase or otherwise) which executes and delivers the agreement provided for in this Section 13 or which otherwise becomes bound by all the terms and provisions of this Agreement by operation of law. (b) Executive's Successors. No rights or obligations of Executive under this Agreement may be assigned or transferred by Executive other than his rights to payments or benefits hereunder, which may be transferred only by will or the laws of descent and distribution. Upon Executive's death, this Agreement and all rights of Executive hereunder shall inure to the benefit of and be enforceable by Executive's beneficiary or beneficiaries, personal or legal representatives, or estate, to the extent any such person succeeds to Executive's interests under this Agreement. Executive shall be entitled to select and change a beneficiary or beneficiaries to receive any benefit or compensation payable hereunder following Executive's death by giving the Company written notice thereof. In the event of - 15 - 16 Executive's death or a judicial determination of his incompetence, reference in this Agreement to Executive shall be deemed, where appropriate, to refer to his beneficiary(ies), estate or other legal representative(s). If Executive should die following his Date of Termination while any amounts would still be payable to him hereunder if he had continued to live, all such amounts unless otherwise provided herein shall be paid in accordance with the terms of this Agreement to such person or persons so appointed in writing by Executive, or otherwise to his legal representatives or estate. 14. Notice. All notices or other communications which are required or permitted hereunder shall be in writing and sufficient if delivered personally, or sent by nationally-recognized, overnight courier or by registered or certified mail, return receipt requested and postage prepaid, addressed as follows: If to Executive: James DeCicco c/o New Plan Excel Realty Trust, Inc. 1120 Ave of the Americas New York, NY 10036 If to the Company: New Plan Excel Realty Trust, Inc. 1120 Ave of the Americas New York, NY 10036 Attn: CEO or to such other address as any party may have furnished to the others in writing in accordance herewith. All such notices and other communications shall be deemed to have been received (a) in the case of personal delivery, on the date of such delivery, (b) in the case of a telecopy, when the party receiving such telecopy shall have confirmed receipt of the communication, (c) in the case of delivery by nationally-recognized, overnight courier, on the business day following dispatch and (d) in the case of mailing, on the third business day following such mailing. 15. Miscellaneous. No provisions of this Agreement may be amended, modified, or waived unless such amendment or modification is agreed to in writing signed by Executive and by a duly authorized officer of the Company, and such waiver is set forth in writing and signed by the party to be charged. No waiver by either party hereto at any time of any breach by the other party hereto of any condition or provision of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof have been made by either party which are not set forth expressly in this Agreement. The - 16 - 17 respective rights and obligations of the parties hereunder of this Agreement shall survive Executive's termination of employment and the termination of this Agreement to the extent necessary for the intended preservation of such rights and obligations. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of New York without regard to its conflicts of law principles. 16. Validity. The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 17. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original but all of which together will constitute one and the same instrument. 18. Entire Agreement. This Agreement sets forth the entire agreement of the parties hereto in respect of the subject matter contained herein and supersede all prior agreements, promises, covenants, arrangements, communications, representations or warranties, whether oral or written by any officer, employee or representative of any party hereto in respect of such subject matter. Any prior agreement of the parties hereto in respect of the subject matter contained herein is hereby terminated and canceled. 19. Shareholder Approval. The Company represents and warrants to Executive that no shareholder approval is required for the Company to enter into this Agreement and provide the benefits hereunder and to enter into the agreements described in Section 5. 20. Withholding. All payments hereunder shall be subject to any required withholding of Federal, state and local taxes pursuant to any applicable law or regulation. 21. Noncontravention. The Company represents that the Company is not prevented from entering into, or performing this Agreement by the terms of any law, order, rule or regulation, its by-laws or certificate of incorporation, or any agreement to which it is a party, other than which would not have a material adverse effect on the Company's ability to enter into or perform this Agreement. 22. Section Headings. The section headings in this Employment Agreement are for convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation. - 17 - 18 IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date first above written. EXCEL REALTY TRUST, INC., a Maryland corporation By: /s/ Richard B. Muir ---------------------------------- Name: Richard B. Muir Title: Executive Vice President /s/ James DeCicco ----------------------------------------- James DeCicco - 18 - EX-10.39 11 UNCONDITIONAL GUARANTY OF PAYMENT 1 EXHIBIT 10.39 New York, New York January 28, 2000 GUARANTY OF PAYMENT FOR VALUE RECEIVED, and to induce LEHMAN ALI, INC., a Delaware corporation, having an address at Three World Financial Center, 200 Vesey Street, New York, New York 10285 ("Lender"), to lend to POINTE ORLANDO DEVELOPMENT COMPANY, a California general partnership ("Borrower"), the principal sum of SEVENTY-EIGHT MILLION FOUR HUNDRED SEVENTY-FOUR THOUSAND SEVEN HUNDRED TWENTY-FOUR AND 90/100 DOLLARS ($78,474,724.90) (the "Loan"), evidenced by the Note (as defined in the Loan Agreement (hereinafter defined)) and secured by the Security Instrument (as defined in the Loan Agreement), and by other documents executed in connection therewith (the "Other Security Documents"). The term "Loan Agreement", as used herein, shall mean, that certain amended and restated the Original Loan Agreement pursuant to that certain Second Amended and Restated Construction Loan Agreement dated April 20, 1998, as amended. The undersigned, NEW PLAN EXCEL REALTY TRUST, INC. having an address at 1120 Avenue of the Americas, New York, New York 10036 ("Guarantor") hereby absolutely and unconditionally guarantees to Lender the prompt and unconditional payment of the Guaranteed Obligations (hereinafter defined). The term "Guaranteed Obligations", as used herein, shall mean a portion of the outstanding amount of the Debt (hereinafter defined) in excess of $48,474,724.90, provided, however, the Guaranteed Obligations shall not be reduced by any payment by the title insurance company resulting from a claim by Lender in connection with the existing mechanic's liens or mechanic's liens filed against the Property in connection with Building 5 which are not bonded and released of record. It is expressly understood and agreed that this is a continuing guaranty and that the obligations of Guarantor hereunder are and shall be absolute under any and all circumstances, without regard to the validity, regularity or enforceability of the Note, the Security Instrument, or the Other Security Documents, a true copy of each of said documents Guarantor hereby acknowledges having received and reviewed. Any indebtedness of borrower to Guarantor now or hereafter existing (including, but not limited to, any rights to subrogation Guarantor may have as a result of any payment by Guarantor under this Guaranty), together with any interest thereon, shall be, and such indebtedness is, hereby deferred, postponed and subordinated to the prior payment in full of the Guaranteed Obligations. Until payment in full of the Guaranteed Obligations (and including interest accruing thereon after the commencement of a proceeding by or against Borrower under the Bankruptcy Reform Act of 1978, as amended, 11 U.S.C. Sections 101 et seq., and the regulations adopted and promulgated pursuant thereto (collectively, the "Bankruptcy Code") which interest the parties agree shall remain a claim that is prior and superior to any claim of Guarantor notwithstanding any contrary practice, custom or ruling in cases under the Bankruptcy Code generally), Guarantor agrees not to accept any payment or satisfaction of any kind of indebtedness of Borrower to Guarantor (provided, however, provided no Event of Default has occurred and is continuing, the foregoing shall not prohibit Borrower from making partnership distributions in the ordinary course of business) and hereby assigns such indebtedness to Lender, including the right to file proof of claim and to vote thereon in connection with any such proceeding under the Bankruptcy Code, including the right to vote on any plan of reorganization. Guarantor agrees that, with or without notice or demand, Guarantor will reimburse Lender, to the extent that such reimbursement is not made by Borrower, for all expenses (including 2 reasonable counsel fees) incurred by Lender in connection with the collection of the Guaranteed Obligations or any portion thereof or with the enforcement of this Guaranty. All moneys available to Lender for application in payment or reduction of the Guaranteed Obligations shall be applied by Lender in such manner and in such amounts and at such time or times and in such order and, priority as Lender may see fit to the payment or reduction of such portion of the Guaranteed Obligations as Lender may elect. Guarantor hereby waives notice of the acceptance hereof, presentment, demand for payment, protest, notice of protest, or any and all notice of non-payment, non-performance or non-observance, or other proof, or notice or demand. Guarantor further agrees that the validity of this Guaranty and the obligations of Guarantor hereunder shall in no way be terminated, affected or impaired (i) by reason of the assertion by Lender of any rights or remedies which it may have under or with respect to either the Note, the Security Instrument, or the Other Security Documents, against any person obligated thereunder or against the owner of the premises covered by the Security Instrument, or (ii) by reason of any failure to file or record any of such instruments or to take or perfect any security intended to be provided thereby, or (iii) by reason of the release or exchange of any property covered by the Security Instrument or other collateral for the Loan, or (iv) by reason of Lender's failure to exercise, or delay in exercising, any such right or remedy or any right or remedy Lender may have hereunder or in respect to this Guaranty, or (v) by reason of the commencement of a case under the Bankruptcy Code by or against any person obligated under the Note, the Security Instrument or the Other Security Documents, or the death of any Guarantor, or (vi) by reason of any payment made on the Debt or any other indebtedness arising under the Note, the Security Instrument or the Other Security Documents, whether made by Borrower or Guarantor or any other person, which is required to be refunded pursuant to any bankruptcy or insolvency law; it being understood that no payment so refunded shall be considered as a payment of any portion of the Guaranteed Obligations, nor shall it have the effect of reducing the liability of Guarantor hereunder. It is further understood, that if Borrower shall have taken advantage of, or be subject to the protection of, any provision in the Bankruptcy Code, the effect of which is to prevent or delay Lender from declaring the Debt (as defined in the Loan Agreement) due and payable on the happening of any default or event by which under the terms of the Note, the Security Instrument or the Other Security Documents, the Debt shall become due and payable, Lender may, as against Guarantor, nevertheless, declare the Guaranteed Obligations due and payable and enforce any or all of its rights and remedies against Guarantor provided for herein. Guarantor further covenants that this Guaranty shall remain and continue in full force and effect as to any modification, extension or renewal of the Note, the Security Instrument, or any of the Other Security Documents, that Lender shall not be under a duty to protect, secure or insure any security or lien provided by the Security Instrument or other such collateral, and that other indulgences or forbearance may be granted under any or all of such documents, all of which may be made, done or suffered without notice to, or further consent of, Guarantor. As a further inducement to Lender to make the Loan and in consideration thereof. Guarantor further covenants and agrees (i) that in any action or proceeding brought by Lender against Guarantor on this Guaranty, Guarantor shall and does hereby waive trial by jury, (ii) that the Supreme Court of the State of New York for the County of New York, or, in a case involving diversity of citizenship, the United States District Court for the Southern District of New York, shall have jurisdiction of any such action or proceeding, and (iii) that within thirty days after service of any summons and complaint or other process in any such action or proceeding, Guarantor so served shall appear or answer to any summons and complaint or other process and should Guarantor so served fail to appear or answer 3 within said thirty-day period, said Guarantor shall be deemed in default and judgment may be entered by Lender against the said party for the amount as demanded in any summons and complaint or other process so served. This is a guaranty of payment and not of collection and upon any default of Borrower under the Note, the Security Instrument or the Other Security Documents, Lender may, at its option, proceed directly and at once, without notice, against Guarantor to collect and recover the full amount of the liability hereunder or any portion thereof, without proceeding against Borrower or any other person, or foreclosing upon, selling, or otherwise disposing of or collecting or applying against any of the mortgaged property or other collateral for the Loan. Guarantor hereby waives the pleading of any statute of limitations as a defense to the obligation hereunder. Each reference herein to Lender shall be deemed to include its successors and assigns, to whose favor the provisions of this Guaranty shall also inure. Each reference herein to Guarantor shall be deemed to include the heirs, executors, administrators, legal representatives, successors and assigns of Guarantor, all of whom shall be bound by the provisions of this Guaranty. Guarantor (and its representative, executing below, if any) has full power, authority and legal right to execute this Guaranty and to perform all its obligations under this Guaranty. All understandings, representations and agreements heretofore had with respect to this Guaranty are merged into this Guaranty which alone fully and completely expresses the agreement of Guarantor and Lender. This Guaranty may be executed in one or more counterparts by some or all of the parties hereto, each of which counterparts shall be an original and all of which together shall constitute a single agreement of Guaranty. The failure of any party hereto to execute this Guaranty, or any counterpart hereof, shall not relieve the other signatories from their obligations hereunder. This Guaranty may not be modified, amended, waived, extended, changed, discharged or terminated orally or by any act or failure to act on the part of Lender or Borrower, but only by an agreement in writing signed by the party against whom enforcement of any modification, amendment, waiver, extension, change, discharge or termination is sought. This Guaranty shall be governed, construed and interpreted as to validity, enforcement and in all other respects, in accordance with the laws of the State of New York. IN WITNESS WHEREOF, Guarantor has duly executed this Guaranty as of the date first above set forth. NEW PLAN EXCEL REALTY TRUST, INC. By: /s/ Dean Bersstien -------------------------------------- Name: Dean Bernstein Title: Senior Vice President EX-10.41 12 TERM LOAN AGREEMENT 1 EXHIBIT 10.41 TERM LOAN AGREEMENT by and among NEW PLAN EXCEL REALTY TRUST, INC. THE LENDERS PARTY HERETO, AND FLEET NATIONAL BANK as Administrative Agent Dated as of March 7, 2000 FLEET BOSTON ROBERTSON STEPHENS, INC. as Sole Lead Arranger and Bookrunner 2 TABLE OF CONTENTS
Page ---- 1. DEFINITIONS 1 1.1 Defined Terms 1 1.2 Other Definitional Provisions 19 2. AMOUNT AND TERMS OF LOANS 19 2.1 Loans 19 2.2 Notes 21 2.3 Procedure for Loan Borrowings 21 2.4 [Intentionally Omitted] 23 2.5 Termination or Reduction of Commitments 23 2.6 Repayment of Loans; Evidence of Debt 23 2.7 Prepayments of the Loans 24 2.8 Conversions 24 2.9 Interest Rate and Payment Dates 25 2.10 Substituted Interest Rate 27 2.11 Taxes; Net Payments 27 2.12 Illegality 28 2.13 Increased Costs 28 2.14 Indemnification for Break Funding Losses 30 2.15 Use of Proceeds 31 2.16 Capital Adequacy 31 2.17 Administrative Agent's Records 32 2.18 [Intentionally Omitted] 32 3. FEES; PAYMENTS 32 3.1 Facility Fee 32 3.2 Payments; Application of Payments 32 4. REPRESENTATIONS AND WARRANTIES 33 4.1 Existence and Power 33 4.2 Authority 33 4.3 Binding Agreement 34 4.4 Subsidiaries; DownREIT Partnerships 34 4.5 Litigation 34 4.6 Required Consents 35 4.7 No Conflicting Agreements 35 4.8 Compliance with Applicable Laws 35 4.9 Taxes 35 4.10 Governmental Regulations 36 4.11 Federal Reserve Regulations; Use of Loan Proceeds 36 4.12 Plans; Multiemployer Plans 36
2 3 4.13 Financial Statements 36 4.14 Property 37 4.15 Franchises, Intellectual Property, Etc 37 4.16 Environmental Matters 37 4.17 Labor Relations 39 4.18 Burdensome Obligations 39 4.19 Solvency 39 4.20 REIT Status 40 4.21 Rent Roll and List of Unencumbered Assets 40 4.22 [Intentionally Omitted] 40 4.23 Operation of Business 40 4.24 No Misrepresentation 40 5. CONDITIONS TO FIRST LOANS 40 5.1 Evidence of Action 40 5.2 This Agreement 41 5.3 Notes 41 5.4 Guaranty 41 5.5 [Intentionally Omitted] 42 5.6 Litigation 42 5.7 Opinion of Counsel to the Borrower 42 5.8 Fees 42 5.9 Fees and Expenses of Special Counsel 42 5.10 [Intentionally Omitted] 42 6. CONDITIONS OF LENDING - ALL LOANS 42 6.1 Compliance 42 6.2 Loan Closings 43 6.3 Borrowing Request 43 6.4 Documentation and Proceedings 43 6.5 Required Acts and Conditions 43 6.6 Approval of Special Counsel 43 6.7 Supplemental Opinions 44 6.8 Other Documents 44 7. AFFIRMATIVE COVENANTS 44 7.1 Financial Statements 44 7.2 Certificates; Other Information 45 7.3 Legal Existence 48 7.4 Taxes 49 7.5 Insurance 49 7.6 Payment of Indebtedness and Performance of Obligations 49 7.7 Maintenance of Property; Environmental Investigations 50 7.8 Observance of Legal Requirements 50 7.9 Inspection of Property; Books and Records; Discussions 51
3 4 7.10 Licenses, Intellectual Property 51 7.11 Required Additional Guarantors 51 7.12 REIT Status; Operation of Business 51 7.13 [Intentionally Omitted] 52 8. NEGATIVE COVENANTS 52 8.1 Liens 52 8.2 Merger, Consolidation and Certain Dispositions of Property 52 8.3 Investments, Loans, Etc 53 8.4 Business Changes 55 8.5 Amendments to Organizational Documents 55 8.6 Bankruptcy Proceedings 55 8.7 Sale and Leaseback 56 8.8 Transactions with Affiliates 56 8.9 Issuance of Additional Capital Stock by Subsidiary Guarantors 56 8.10 Hedging Agreements 56 8.11 Restricted Payments 56 8.12 Unencumbered Assets Coverage Ratio 57 8.13 Fixed Charge Coverage Ratio 57 8.14 Minimum Tangible Net Worth 57 8.15 Maximum Total Indebtedness 58 8.16 Liabilities to Assets Ratio 58 8.17 Maximum Book Value of Ancillary Assets 58 9. DEFAULT 58 9.1 Events of Default 58 10.1 Appointment 61 10.2 Delegation of Duties 62 10.3 Exculpatory Provisions 62 10.4 Reliance by Administrative Agent 62 10.5 Notice of Default 62 10.6 Non-Reliance on Administrative Agent and Other Lenders 63 10.7 Indemnification 63 10.8 Administrative Agent in Its Individual Capacity 64 10.9 Successor Administrative Agent 64 10.10 [Intentionally Omitted] 65 11. OTHER PROVISIONS 65 11.1 Amendments and Waivers 65 11.2 Notices 66
4 5 11.3 No Waiver; Cumulative Remedies 67 11.4 Survival of Representations and Warranties 67 11.5 Payment of Expenses and Taxes 68 11.6 Lending Offices 69 11.7 Successors and Assigns 69 11.8 [Intentionally Omitted] 71 11.9 Counterparts 71 11.10 Adjustments; Set-off 71 11.11 Lenders' Representations 72 11.12 Indemnity 72 11.13 Governing Law 73 11.14 Headings Descriptive 73 11.15 Severability 73 11.16 Integration 73 11.17 Consent to Jurisdiction 74 11.18 Service of Process 74 11.19 No Limitation on Service or Suit 74 11.20 WAIVER OF TRIAL BY JURY 74 11.21 Termination 75
LIST OF EXHIBITS AND SCHEDULES
EXHIBITS: - -------- Exhibit A - Assignment and Assumption Exhibit B - Commitment Amounts Exhibit C - [Intentionally Omitted] Exhibit D - Compliance Certificate Exhibit E - Borrowing Request Exhibit F - Guaranty Exhibit G - [Intentionally Omitted] Exhibit H - Note Exhibit I - Secretary's Certificate (Borrower) Exhibit J - Secretary's Certificate (Guarantor) Exhibit K - Points for Legal Opinions Exhibit L - [Intentionally Omitted] Exhibit M - Form of Notice of Conversion SCHEDULES: - --------- Schedule I - Domestic and Eurodollar Lending Offices Schedule 4.4 - Subsidiaries (including Subsidiary Guarantors) Schedule 4.5 - Litigation Schedule 4.12 - Plans
5 6
Schedule 4.21 - Rent Roll and List of Unencumbered Assets
6 7 TERM LOAN AGREEMENT, dated as of March ___, 2000, by and among NEW PLAN EXCEL REALTY TRUST, INC., a Maryland corporation (the "Borrower"), each lender party hereto or which becomes a "Lender" pursuant to the provisions of Section 11.7 (each a "Lender" and, collectively, the "Lenders"), and FLEET NATIONAL BANK, as administrative agent (in such capacity, the "Administrative Agent"). 1. DEFINITIONS. 1.1 Defined Terms . As used in this Agreement, terms defined in the preamble have the meanings therein indicated, and the following terms have the following meanings: "ABR Advances": the Loans (or any portions thereof) at such time as they (or such portions) are made and/or being maintained at a rate of interest based upon the Alternate Base Rate. "Accountants": PricewaterhouseCoopers LLP, or, after the date hereof, any of: Arthur Andersen LLP; Deloitte & Touche LLP; Ernst & Young LLP; KPMG LLP; or any successor to any of the foregoing; or such other firm of certified public accountants of recognized national standing selected by the Borrower and satisfactory to the Administrative Agent. "Adjusted Net Operating Income": for any period, the aggregate amount of the Net Operating Income from each Unencumbered Asset during such period, less the Capital Expense Reserve for such Unencumbered Asset during such period. "Advance": an ABR Advance or a Eurodollar Advance, as the case may be. "Advance Termination Date": April 28, 2000. "Affected Advance": as defined in Section 2.10. "Affected Principal Amount": in the event that (i) the Borrower shall fail for any reason to borrow or convert after it shall have notified the Administrative Agent of its intent to do so in any instance in which it shall have requested a Eurodollar Advance pursuant to Section 2.3 or 2.8, an amount equal to the principal amount of such Eurodollar Advance; (ii) a Eurodollar Advance shall terminate for any reason prior to the last day of the Interest Period applicable thereto, an amount equal to the principal amount of such Eurodollar Advance; or (iii) the Borrower shall prepay or repay all or any part of the principal amount of a Eurodollar Advance prior to the last day of the Interest Period applicable thereto (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality), an amount equal to the principal amount of such Eurodollar Advance so prepaid or repaid. "Affiliate": as to any Person, any other Person which, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person. For purposes of this 7 8 definition, control of a Person shall mean the power, direct or indirect, (i) to vote 10% or more of the securities having ordinary voting power for the election of directors of such Person or (ii) to direct or cause the direction of the management and policies of such Person, whether by contract or otherwise. "Agreement": this Term Loan Agreement, as the same may be amended, supplemented or otherwise modified from time to time. "Agreement Regarding Fees": that certain Agreement Regarding Fees dated of even date herewith between FNB and the Borrower. "Alternate Base Rate": on any date, a rate of interest per annum equal to the higher of (i) the Federal Funds Rate in effect on such date plus 1/2 of 1% or (ii) the FNB Rate in effect on such date. "Ancillary Assets": at any time, all Real Property of the Borrower and its Subsidiaries, or in which the Borrower or any Subsidiary of the Borrower has an interest (either directly or indirectly), and which is (i) a Development Asset, (ii) a mortgage, or (iii) any other Real Property other than an open air shopping center (including single tenant retail properties) or a residential apartment building or residential apartment community (and appurtenant amenities). "Applicable Lending Office": in respect of any Lender, (i) in the case of such Lender's ABR Advances, its Domestic Lending Office and (ii) in the case of such Lender's Eurodollar Advances, its Eurodollar Lending Office. "Applicable Margin": with respect to the unpaid principal balance of ABR Advances or Eurodollar Advances, at all times during which the applicable Pricing Level set forth below is in effect, the respective percentage set forth below next to such Pricing Level:
Pricing Level Eurodollar Advances ABR Advances ------------- ------------------- ------------ Pricing Level I 0.80% 0% Pricing Level II 0.90% 0% Pricing Level III 1.15% 0% Pricing Level IV 1.20% 0% Pricing Level V 1.25% 0.25%
Changes in the Applicable Margin resulting from a change in a Pricing Level shall become effective as of the opening of business upon the date of any change in the Senior Debt Rating of the Borrower, as determined by S&P or Moody's, as the case may be, which would affect the applicable Pricing Level. "Assignment and Assumption Agreement": an assignment and assumption agreement executed by an assignor and an assignee pursuant to which such assignor assigns to such assignee all or any portion of such assignor's Notes and Commitments, substantially in the 8 9 form of Exhibit A. "Assignment Fee": as defined in Section 11.7(b). "Authorized Signatory": the chairman of the board, the president, any vice president, the Chief Financial Officer or any other duly authorized officer (acceptable to the Administrative Agent) of the Borrower. "Available Commitment Amount": on any day during the Loan Period, an amount equal to the Total Commitment Amount at such time minus the total of all Loans outstanding on such date. "Benefitted Lender": as defined in Section 11.10. "Borrower's Interest": for any period, (i) with respect to Unencumbered Assets owned by a DownREIT Partnership, a fraction, expressed as a percentage, the numerator of which is the Net Operating Income of such Unencumbered Assets for such period, less any distributions required to be made to partners or members of such DownREIT Partnership, other than the Borrower and its Subsidiaries, and the denominator of which is the Net Operating Income of such Unencumbered Assets for such period, and (ii) with respect to any Ancillary Asset, the percentage of profits and losses with respect thereto to which the Borrower or its Subsidiaries, directly or indirectly, may be entitled to receive for such period. "Borrowing Date": any Business Day specified in a Borrowing Request delivered pursuant to Section 2.3 as a date on which the Borrower requests the Lenders to make Loans. "Borrowing Request": a borrowing request in the form of Exhibit E. "Business Day": for all purposes other than as set forth in clause (ii) below, (i) any day other than a Saturday, a Sunday or a day on which commercial banks located in Boston, Massachusetts, are authorized or required by law or other governmental action to close and (ii) with respect to all notices and determinations in connection with, and payments of principal and interest on, Eurodollar Advances, any day which is a Business Day described in clause (i) above and which is also a day on which dealings in foreign currency and exchange and Eurodollar funding between banks may be carried on in London, England. "Capital Leases": leases which have been, or under GAAP are required to be, capitalized. "Capital Expense Reserve": during any period, (i) with respect to each Unencumbered Asset other than a residential apartment building or residential apartment community, an amount equal to (A) a per annum rate of $.20 times (B) the total Net Rentable Area of such Unencumbered Asset, and (ii) with respect to each Unencumbered Asset that is a residential apartment building or residential apartment community, an amount equal to (A) $150 times (B) the number of apartment units in such residential apartment building or community (in each case whether or not such reserves are actually established by the Borrower). 9 10 "Change of Control": the occurrence of any one of the following events: (a) any Person or Persons acting as a group shall acquire direct or indirect ownership of 30% or more of the Borrower's common Stock; or (b) during any twelve month period on or after the Effective Date, individuals who at the beginning of such period constituted the Board of Directors of the Borrower (together with any new directors whose election by the Board of Directors or whose nomination for election by the shareholders of the Borrower was approved by a vote of at least a majority of the members of the Board of Directors then in office who either were members of the Board of Directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the members of the Board of Directors then in office; or (c) there occurs a change of control of the Borrower of a nature that would be required to be reported in response to Item 1a of Form 8-K filed pursuant to Section 13 or 15 under the Securities Exchange Act of 1934, or in any other filing by the Borrower with the Securities and Exchange Commission; or (d) the Borrower consolidates with, is acquired by, or merges into or with any Person (other than a merger permitted by Section 8.2). "Chief Financial Officer": at any time, the chief financial officer of the Borrower, or if the Borrower does not have a chief financial officer at such time, the officer designated by the Borrower as its principal financial officer or such other officer of the Borrower that is acceptable to the Administrative Agent. "Code": the Internal Revenue Code of 1986, as the same may be amended from time to time, or any successor thereto, and the rules and regulations issued thereunder, as from time to time in effect. "Commitment": in respect of any Lender, such Lender's undertaking during the Loan Period to make Loans, subject to the terms and conditions hereof, in an aggregate outstanding principal amount not exceeding such Lender's Commitment Amount. "Commitment Amount": the amount set forth next to the name of such Lender in Exhibit B under the heading "Commitments" as such Lender's Commitment Amount, as the same may be increased pursuant to Section 2.1(b) or reduced pursuant to Section 2.5. "Commitment Percentage": on any day, and as to any Lender, the quotient of (i) such Lender's Commitment Amount on such day, divided by (ii) the Commitments of all Lenders on such day. "Compliance Certificate": a certificate substantially in the form of Exhibit D. 10 11 "Consolidated": the Borrower and its Subsidiaries which are consolidated for financial reporting purposes. "Consolidated EBITDA": for any period, net income for such period of the Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, plus, without duplication and to the extent deducted in determining such net income, the sum of (i) Consolidated Interest Expense for such period, (ii) the aggregate amount of any taxes paid during such period, (iii) the aggregate amount attributable to depreciation and amortization for such period, (iv) the aggregate amount of extraordinary charges during such period and (v) the aggregate amount of non-cash expenses during such period, and minus, without duplication and to the extent added in determining such net income for such period, the aggregate amount of extraordinary gains during such period. "Consolidated Fixed Charges": during any period, the sum of each of the following with respect to the Borrower and its Subsidiaries (without duplication), determined on a Consolidated basis in accordance with GAAP: (i) the aggregate amount of all interest expense, both expensed and capitalized (including Consolidated Interest Expense) for such period, (ii) the aggregate of all scheduled principal amounts that become payable during such period in respect of any Indebtedness of the Borrower or its Subsidiaries (excluding balloon payments at maturity) and (iii) the aggregate amount of all cash dividends paid during such period in respect of preferred stock of the Borrower or its Subsidiaries. "Consolidated Interest Expense": for any period, interest and fees accrued, accreted or paid by the Borrower and its Subsidiaries during such period in respect of Consolidated Total Indebtedness, determined in accordance with GAAP, including (a) the amortization of debt discounts to the extent included in interest expense in accordance with GAAP, (b) the amortization of all fees (including fees with respect to interest rate cap agreements or other agreements or arrangements entered into by the Borrower or any of its Subsidiaries designed to protect the Borrower or such Subsidiaries, as applicable, against fluctuations in interest rates) payable in connection with the incurrence of any Indebtedness to the extent included in interest expense in accordance with GAAP and (c) the portion of any rents payable under capital leases allocable to interest expense in accordance with GAAP. "Consolidated Total Indebtedness": as of any date, the aggregate principal amount of all Indebtedness of the Borrower and its Subsidiaries determined on a Consolidated basis in accordance with GAAP, plus, if not otherwise required to be reflected in the Borrower's Consolidated balance sheet (and without duplication) (i) Contingent Obligations of the Borrower and its Subsidiaries on such date which are required in accordance with GAAP to be disclosed in a footnote to any such balance sheet, and (ii) any guarantee by the Borrower of any Indebtedness of an unconsolidated Subsidiary or joint venture in which the Borrower is a direct or indirect investor (to the full extent of the amount of such guaranteed Indebtedness on such date). "Contingent Obligation": as to any Person, any obligation of such Person guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations ("Primary Obligations") of any other Person (the "Primary Obligor") in any manner, whether 11 12 directly or indirectly, and whether arising from partnership or keep-well agreements, including, without limitation, any obligation of such Person, whether contingent or not contingent (a) to purchase any such Primary Obligation or any Property constituting direct or indirect security therefor, (b) to advance or supply funds (i) for the purchase or payment of any such Primary Obligation or (ii) to maintain working capital or equity capital of the Primary Obligor or otherwise to maintain net worth, solvency or other financial statement condition of the Primary Obligor, (c) to purchase Property, securities or services primarily for the purpose of assuring the beneficiary of any such Primary Obligation of the ability of the Primary Obligor to make payment of such Primary Obligation or (d) otherwise to assure, protect from loss or hold harmless the beneficiary of such Primary Obligation against loss in respect thereof; provided, however, that the term Contingent Obligation shall not include the endorsement of instruments for deposit or collection in the ordinary course of business. The term Contingent Obligation shall also include the liability of a general partner in respect of the liabilities of the partnership in which it is a general partner. The amount of any Contingent Obligation of a Person shall be deemed to be an amount equal to the stated or determinable amount of the Primary Obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith. "Conversion Date": the date on which a Eurodollar Advance is converted to an ABR Advance, or the date on which an ABR Advance is converted to a Eurodollar Advance, or the date on which a Eurodollar Advance is converted to a new Eurodollar Advance, all in accordance with Section 2.8. "Credit Party": the Administrative Agent, the Lead Arranger, each Lender and their successors and assigns. "Default": any event or condition which constitutes an Event of Default or which, with the giving of notice, the lapse of time, or any other condition, would, unless cured or waived, become an Event of Default. "Defaulting Lender": at any time, any Lender that, at such time, (i) has failed to comply with any of its obligations to make a Loan as required pursuant to Section 2.3 of this Agreement, (ii) has failed to pay to the Administrative Agent or any Lender an amount owed by such Lender pursuant to the terms of this Agreement or any of the other Loan Documents, or (iii) has advised the Administrative Agent that it does not intend to comply with its obligations under Section 2.3 by reason of having been deemed insolvent or having become subject to a bankruptcy or insolvency proceeding. "Development Asset": any Property of the Borrower or its Subsidiaries, or in which the Borrower or any of its Subsidiaries has an interest (either directly or indirectly) (i) which is new construction, or which is undergoing an expansion which will increase the Net Rentable Area of such Property by 20,000 square feet or more (provided that with respect to any Property which is under expansion, if the balance thereof is a fully integrated, rentable property, then only the portion of such Property that is under expansion shall be a Development Asset), 12 13 and (ii) for which a certificate of occupancy, whether temporary or permanent, or the functional equivalent thereof, has not been issued with respect to such construction or expansion. Notwithstanding the foregoing, any such new construction or expansion which shall have been a Development Asset under the criteria of this definition shall no longer be a Development Asset upon such time as (A) the same is an income-producing Property in operating condition, and (B) at least 70% of the Net Rentable Area (determined on an "as completed" basis) of such construction or expansion is initially leased to tenants who have taken possession thereof. "Dollars" and "$": lawful currency of the United States of America. "Domestic Lending Office": in respect of any Lender, initially, the office or offices of such Lender designated as such on Schedule I; thereafter, such other office of such Lender through which it shall be making or maintaining ABR Advances, as reported by such Lender to the Administrative Agent and the Borrower. "DownREIT Partnership": Excel Realty Partners, L.P., E. H. Properties, L.P. and any other partnership or limited liability company hereafter created by the Borrower for the purpose of acquiring assets qualifying as "real estate assets" under Section 856(c) of the Code through the issuance of partnership or limited liability company units in such partnership or limited liability company to third parties, provided that, in the case of each such entity (including Excel Realty Partners, L.P. and E. H. Properties, L.P.) (i) the Borrower or a wholly owned Subsidiary of the Borrower is the sole general partner or managing member of such partnership or limited liability company, as the case may be, and (ii) the Borrower or its wholly owned Subsidiary shall be entitled to receive not less than 99% of the net income and gains before depreciation, if any, from such partnership or limited liability company after the limited partners or non-managing members of such partnership or limited liability company receive a stipulated distribution. Any partnership or limited liability company created after the Effective Date must be approved by the Administrative Agent as a "DownREIT Partnership" for purposes of being included in this definition. "Effective Date": the date on which the conditions specified in Section 5 are satisfied. "Environmental Laws": any and all federal, state and local laws relating to the environment, the use, storage, transporting, manufacturing, handling, discharge, disposal or recycling of hazardous substances, materials or pollutants or industrial hygiene and including, without limitation, (i) the Comprehensive Environmental Response, Compensation and Liability Act, as amended, 42 USCA Section 9601 et seq.; (ii) the Resource Conservation and Recovery Act of 1976, as amended, 42 USCA Section 6901 et seq.; (iii) the Toxic Substance Control Act, as amended, 15 USCA Section 2601 et seq.; (iv) the Water Pollution Control Act, as amended, 33 USCA Section 1251 et seq.; (v) the Clean Air Act, as amended, 42 USCA Section 7401 et seq.; (vi) the Hazardous Material Transportation Act, as amended, 49 USCA Section 1801 et seq. and (viii) all rules, regulations, judgments, decrees, injunctions and restrictions thereunder and any analogous state law. "Environmental Risk Property": any Real Property of the Borrower, a Subsidiary 13 14 Guarantor or a DownREIT Partnership in respect of which, at any time: (i) Hazardous Substances are (A) generated or manufactured on, transported to or from, treated at, stored at or discharged from such Real Property in violation of any Environmental Laws; (B) discharged into subsurface waters under such Real Property in violation of any Environmental Laws; or (C) discharged from such Real Property on or into property or waters (including subsurface waters) adjacent to such Real Property in violation of any Environmental Laws, and any of the foregoing events in (A), (B) or (C) has an Adverse Environmental Impact; or (ii) there exists with respect to such Real Property (A) a claim, demand, suit, action, proceeding, condition, report, directive, lien, violation, or non-compliance concerning any liability (including, without limitation, potential liability for enforcement, investigatory costs, cleanup costs, government response costs, removal costs, remedial costs, natural resources damages, property damages, personal injuries or penalties) arising in connection with: (x) any non-compliance with or violation of the requirements of any applicable Environmental Laws, or (y) the presence of any Hazardous Substance on such Real Property or the release of any Hazardous Substance into the environment from such Real Property, or (B) any actual liability in connection with the presence of any Hazardous Substance on such Real Property or the release of any Hazardous Substance into the environment from such Real Property, and any of the foregoing events in (A) or (B) has an Adverse Environmental Impact. For purposes of this definition, the term "Adverse Environmental Impact" shall mean any event described in clauses (A), (B) or (C) of paragraph (i) above or clauses (A) or (B) of paragraph (ii) above which could reasonably be expected to have a material adverse effect on (1) the value of such Real Property, (2) the marketability of such Real Property, or (3) the ability to finance or refinance such Real Property. "ERISA": the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations issued thereunder, as from time to time in effect. "ERISA Affiliate": any Person which is a member of any group of organizations (i) described in Section 414(b) or (c) of the Code of which the Borrower is a member, or (ii) solely for purposes of potential liability under Section 302(c)(11) of ERISA and Section 412(c)(11) of the Code and the Lien created under Section 302(f) of ERISA and Section 412(n) of the Code, described in Section 414(m) or (o) of the Code of which the Borrower is a member. "ERISA Liabilities": without duplication, the aggregate of all unfunded vested benefits under all Plans and all potential withdrawal liabilities under all Multiemployer Plans. "Eurodollar Advance": collectively, the Loans (or any portions thereof), at such time as they (or such portions) are made and/or being maintained at a rate of interest based upon a particular Eurodollar Rate; and "Eurodollar Advances" shall mean all such Eurodollar Advances in the aggregate. 14 15 "Eurodollar Lending Office": in respect of any Lender, initially, the office, branch or affiliate of such Lender designated as such on Schedule I (or, if no such office branch or affiliate is specified, its Domestic Lending Office); thereafter, such other office, branch or affiliate of such Lender through which it shall be making or maintaining Eurodollar Advances, as reported by such Lender to the Administrative Agent and the Borrower. "Eurodollar Rate": with respect to each Eurodollar Advance and as determined by the Administrative Agent, the rate of interest per annum (rounded, if necessary, to the nearest 1/100 of 1% or, if there is no nearest 1/100 of 1%, then to the next higher 1/100 of 1%) equal to a fraction, the numerator of which is the rate per annum quoted by FNB at approximately 12:00 P.M. (or as soon thereafter as practicable) two Eurodollar Business Days prior to the first day of such Interest Period to leading banks in the interbank eurodollar market as the rate at which FNB is offering Dollar deposits in an amount approximately equal to its Commitment Percentage of such Eurodollar Advance and having a period to maturity approximately equal to the Interest Period applicable to such Eurodollar Advance, and the denominator of which is an amount equal to 1.00 minus the aggregate of the then stated maximum rates during such Interest Period of all reserve requirements (including marginal, emergency, supplemental and special reserves), expressed as a decimal, established by the Board of Governors of the Federal Reserve System and any other banking authority to which FNB and other major United States money center banks are subject, in respect of eurocurrency liabilities. "Event of Default": any of the events specified in Section 9, provided that any requirement for the giving of notice, the lapse of time or any other condition specified in Section 9 has been satisfied. "Existing Credit Agreements" shall mean (i) that certain Credit Agreement (Facility I) dated as of November 17, 1999 among the Borrower, The Bank of New York, as Administrative Agent, and the lenders signatory thereto, and (ii) that certain Credit Agreement (Facility II), dated as of November 17, 1999, among the Borrower, The Bank of New York, as Administrative Agent, and the lenders signatory thereto. "Facility Fee": as defined in Section 3.1. "Federal Funds Rate": for any day, a rate per annum (expressed as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%), equal to the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day, provided that (i) if the day for which such rate is to be determined is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if such rate is not so published for any day, the Federal Funds Rate for such day shall be the average of the quotations for such day on such transactions received by FNB as determined by FNB and reported to the Administrative Agent. 15 16 "Financial Statements": as defined in Section 4.13. "FNB": Fleet National Bank. "FNB Rate": a rate of interest per annum equal to the rate of interest publicly announced in Boston, Massachusetts, by FNB from time to time as its prime commercial lending rate, such rate to be adjusted automatically (without notice) on the effective date of any change in such publicly announced rate. "Funds from Operations": With respect to any Person for any fiscal period, the sum of (i) the net income of such Person for such fiscal period (computed in accordance with GAAP), excluding gains (or losses) from debt restructuring and sales of property, (ii) depreciation and amortization, and (iii) other non-cash items, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures will be calculated to reflect funds from operations on the same basis. "GAAP": generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statement by such other entity as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination, consistently applied. "Governmental Authority": any nation or government, any state or other political subdivision thereof, any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and any court or arbitrator. "Ground Lease": a ground lease in favor of the Borrower, a wholly owned Subsidiary or a DownREIT Partnership which has an unexpired term of 30 years or more (inclusive of any tenant-controlled renewal options) and which includes within its terms those rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold estate demised pursuant to such ground lease. "Guaranty": collectively, (i) a Guaranty, substantially in the form of Exhibit F executed by each of the Subsidiary Guarantors identified on Schedule 4.4 and delivered to the Administrative Agent for the benefit of the Lenders on or prior to the Effective Date, and (ii) each additional Guaranty substantially in the form of Exhibit F executed by each Required Additional Guarantor and delivered to the Administrative Agent for the benefit of the Lenders after the Effective Date. "Hazardous Substance": any hazardous or toxic substance, material or waste, including, but not limited to, (i) those substances, materials, and wastes listed in the United States Department of Transportation Hazardous Materials Table (49 CFR 172.101) or by the Environmental Protection Agency as hazardous substances (40 CFR Part 302) and amendments thereto and replacements therefor and (ii) any substance, pollutant or material defined as, or 16 17 designated in, any Environmental Law as a "hazardous substance," "toxic substance," "hazardous material," "hazardous waste," "restricted hazardous waste," "pollutant," "toxic pollutant" or words of similar import. "Hedging Agreement" means any interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement. "Highest Lawful Rate": with respect to any Lender, the maximum rate of interest, if any, that at any time or from time to time may be contracted for, taken, charged or received by such Lender on its Note or which may be owing to such Lender pursuant to this Agreement under the laws applicable to such Lender and this Agreement. "Indebtedness": as to any Person, at a particular time, all items which constitute, without duplication, (a) indebtedness for borrowed money (including, without limitation, indebtedness under this Agreement and the Notes) or the deferred purchase price of Property (other than trade payables incurred in the ordinary course of business), (b) indebtedness evidenced by notes, bonds, debentures or similar instruments, (c) obligations with respect to any conditional sale or title retention agreement, (d) indebtedness arising under acceptance facilities and the amount available to be drawn under all letters of credit issued for the account of such Person and, without duplication, all drafts drawn thereunder to the extent such Person shall not have reimbursed the issuer in respect of the issuer's payment of such drafts, (e) all liabilities secured by any Lien on any Property owned by such Person even though such Person has not assumed or otherwise become liable for the payment thereof (other than carriers', warehousemen's, mechanics', repairmen's or other like non-consensual statutory Liens arising in the ordinary course of business), (f) obligations under Capital Leases, (g) Contingent Obligations and (h) ERISA Liabilities. "Indemnified Person": as defined in Section 11.12. "Intellectual Property": all copyrights, trademarks, patents, trade names and service names. "Interest Payment Date": (i) as to any ABR Advance, the first day of each month commencing on the first such day to occur after such ABR Advance is made or any Eurodollar Advance is converted to an ABR Advance, (ii) as to any Eurodollar Advance in respect of which the Borrower has selected an Interest Period of one, two or three months, the last day of such Interest Period, and (iii) as to any Eurodollar Advance in respect of which the Borrower has selected an Interest Period of six months, the day which is three months after the first day of such Interest Period and the last day of such Interest Period. "Interest Period": with respect to any Eurodollar Advance requested by the Borrower, the period commencing on, as the case may be, the Borrowing Date or Conversion Date with respect to such Eurodollar Advance and ending one, two, three or six months thereafter, as selected by the Borrower in its irrevocable Borrowing Request as provided in 17 18 Section 2.3 or its irrevocable notice of conversion as provided in Section 2.8; provided, however, that all of the foregoing provisions relating to Interest Periods are subject to the following: (a) if any Interest Period pertaining to a Eurodollar Advance would otherwise end on a day which is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month, in which event such Interest Period shall end on the immediately preceding Business Day; (b) if, with respect to the borrowing of any Loan as a Eurodollar Advance or the conversion of one Advance to another pursuant to Section 2.8, the Borrower shall fail to give due notice as provided in Section 2.3 or 2.8, as the case may be, the Borrower shall be deemed to have elected that such Loan or Advance shall be made as an ABR Advance; (c) any Interest Period 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 a calendar month; (d) with respect to any Interest Period applicable to a Eurodollar Advance, no such Interest Period shall end after the Maturity Date; and (e) the Borrower shall select Interest Periods so as not to have more than six different Interest Periods outstanding at any one time with respect to Eurodollar Advances. "Investments": as defined in Section 8.3. "Lead Arranger": Fleet Boston Robertson Stephens, Inc. "Lien": any mortgage, pledge, hypothecation, assignment, deposit or preferential arrangement, encumbrance, lien (statutory or other), or other security agreement or security interest of any kind or nature whatsoever, including, without limitation, any conditional sale or other title retention agreement and any capital or financing lease having substantially the same economic effect as any of the foregoing. "Loan" and "Loans": an individual term loan or the aggregate term loans as the case may be, to be made by the Lenders hereunder. All Loans shall be made in Dollars. "Loan Documents": collectively, this Agreement, the Guaranty (and each Guaranty subsequently delivered pursuant to Section 7.11) and the Notes. "Loan Period": the period from the Effective Date through the day preceding the Advance Termination Date. "Margin Stock": any "margin stock", as said term is defined in Regulation U of the Board of Governors of the Federal Reserve System, as the same may be amended or 18 19 supplemented from time to time. "Material Adverse Effect": a material adverse effect on (i) the financial condition, operations, business, or Properties of (A) the Borrower or (B) the Borrower and its Subsidiaries taken as a whole, (ii) the ability of the Borrower to perform its obligations under the Loan Documents or (iii) the ability of the Administrative Agent and the Lenders to enforce the Loan Documents. "Maturity Date": the earlier of the date that is 364 days from the Effective Date (March 5, 2001)or the date on which the Notes shall become due and payable, whether by acceleration or otherwise. "Moody's": Moody's Investors Services, Inc. "Multiemployer Plan": a plan defined as such Section 3(37) of ERISA to which contributions have been made by the Borrower or any ERISA Affiliate and which is covered by Title IV of ERISA. "Net Operating Income": for any period and with respect to all assets which are Unencumbered Assets during such period, net income for such period, determined in accordance with GAAP, attributable to Unencumbered Assets, plus depreciation and amortization, interest expense and any extraordinary or non-recurring losses deducted in calculating such net income, minus extraordinary or non-recurring gains and payments (including rent insurance proceeds and condemnation awards) included in such net income, minus any portion of such net income attributable to rents paid by any tenant which is an Affiliate of the Borrower, minus an amount (but not less than zero) equal to the difference between (i) 3% of Operating Income for such period, less (ii) management fees payable in respect of such Unencumbered Assets during such period. For purposes of any calculation of Net Operating Income, real estate taxes, ground rent and insurance, shall be included only at their stabilized, recurring levels. "Net Rentable Area": with respect to any Real Property, the floor area of any buildings, structures or improvements thereof (expressed in square feet) available for leasing to tenants, as determined in accordance with the leases or site plans or leasing plans for such Real Property, or if such leases or site plans do not set forth the floor area demised thereunder (or if such Real Property is not subject to a lease), then as determined by the Borrower in accordance with an industry-accepted protocol approved by the Administrative Agent. "Non-Recourse Exclusions": With respect to any Indebtedness of any Person which is secured by one or more parcels of Real Property or interests therein and which is not a general obligation of such Person, any usual and customary exclusions from the non-recourse limitations governing such Indebtedness, including, without limitation, exclusions for claims that (i) are based on fraud, intentional misrepresentation or misapplication of funds, (ii) result from intentional mismanagement of or waste at such Real Property, (iii) arise from the presence of Hazardous Substances on such Real Property; or (iv) are the result of any unpaid real estate taxes and assessments. 19 20 "Non-Recourse Indebtedness": At any time, Indebtedness of the Borrower and of its Subsidiaries at such time which is secured by one or more parcels of Real Property or interests therein and which is not a general obligation of the Borrower or such Subsidiary, the holder of such Indebtedness having recourse solely to the parcels of Real Property securing such Indebtedness, the leases thereon and the rents and profits thereof (except for recourse against the general credit of the Borrower or its Subsidiaries for any Non-Recourse Exclusions), provided that in calculating the amount of Non-Recourse Indebtedness at any time, the amount of any Non-Recourse Exclusions which are the subject of a final judgment shall not be included in Non-Recourse Indebtedness. "Note" and "Notes": as defined in Section 2.2. "Operating Property": Any Real Property which at any time (i) is an income-producing property in operating condition and in respect of which no material part thereof has been damaged by fire or other casualty (unless such damage has been repaired) or condemned (unless such condemnation has been restored), (ii) is a retail shopping center, residential apartment building, office building or other operating Property, (iii) for which a certificate of occupancy, whether temporary or permanent, or the functional equivalent thereof, has been issued for all improvements comprising the same and are in full force and effect, and (iv) is at least 60% occupied by tenants who have accepted the property and are paying rent in accordance with the terms of their leases, and "Operating Properties" means all such Operating Properties, collectively. "PBGC": the Pension Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of ERISA, or any Governmental Authority succeeding to the functions thereof. 20 21 "Permitted Liens": Liens permitted to exist under Section 8.1. "Person": an individual, a partnership, a corporation, a business trust, a limited liability company, a joint stock company, a trust, an unincorporated association, a joint venture, a Governmental Authority or any other entity of whatever nature. "Plan": any employee benefit or other plan established or maintained by the Borrower or any ERISA Affiliate and which is covered by or subject to the minimum funding standards of Title IV of ERISA, other than a Multiemployer Plan. "Pricing Level": one of the following five pricing levels, as applicable, provided that if the ratings by S&P and Moody's in any such Pricing Level are split by one equivalent rating level, the operative rating would be deemed to be the higher of the two ratings, and if the ratings by S&P and Moody's in any such Pricing Level are split by more than one equivalent rating level, the operative rating would be deemed to be one rating level higher than the lower of the two ratings, and provided, further, that during any period that the Borrower has no Senior Debt Rating, Pricing Level V would be the applicable Pricing Level: "Pricing Level I": the Pricing Level which would be applicable for so long as the Senior Debt Rating is greater than or equal to A- by S&P or A3 by Moody's; "Pricing Level II": the Pricing Level which would be applicable for so long as the Senior Debt Rating is equal to BBB+ by S&P or Baa1 by Moody's and Pricing Level I is not applicable; "Pricing Level III": the Pricing Level which would be applicable for so long as the Senior Debt Rating is equal to BBB by S&P or Baa2 by Moody's and Pricing Levels I and II are not applicable; "Pricing Level IV": the Pricing Level which would be applicable for so long as the Senior Debt Rating is equal to BBB- by S&P or Baa3 by Moody's and Pricing Levels I, II and III are not applicable; and "Pricing Level V": the Pricing Level which would be applicable for so long as the Senior Debt Rating is less than BBB- by S&P or Baa3 by Moody's and Pricing Levels I, II, III and IV are not applicable. "Property": all types of real, personal, tangible, intangible or mixed property. "Rated Period": Any period during which S&P and Moody's are maintaining a Senior Debt Rating and such Senior Debt Rating is at least BBB- as determined by S&P, and at least Baa3, as determined by Moody's. "Real Property": all real Property, and all interests in real Property, owned, leased or held by the Borrower or any Subsidiary of the Borrower. 21 22 "REIT": a Person qualifying as a real estate investment trust under sections 856-859 of the Code and the regulations and rulings of the Internal Revenue Service issued thereunder. "Remaining Interest Period": (i) in the event that the Borrower shall fail for any reason to borrow a Loan in respect of which it shall have requested a Eurodollar Advance or convert an Advance to a Eurodollar Advance after it shall have notified the Administrative Agent of its intent to do so pursuant to Section 2.3 or 2.8, a period equal to the Interest Period that the Borrower elected in respect of such Eurodollar Advance; or (ii) in the event that a Eurodollar Advance shall terminate for any reason prior to the last day of the Interest Period applicable thereto, a period equal to the remaining portion of such Interest Period if such Interest Period had not been so terminated; or (iii) in the event that the Borrower shall prepay or repay all or any part of the principal amount of a Eurodollar Advance (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality) prior to the last day of the Interest Period applicable thereto, a period equal to the period from and including the date of such prepayment or repayment to but excluding the last day of such Interest Period. "Rent Roll": a schedule prepared by the Borrower from time to time identifying (i) the Real Property owned by the Borrower or its Subsidiaries and stating whether such items of Real Property are Unencumbered Assets at such time, (ii) the annual base rent payable under each lease of Real Property owned by the Borrower or any of its Subsidiaries, (iii) the commencement and termination dates of the term of each such lease, (iv) any renewal options with respect to such lease, (v) the Net Rentable Area of the space demised under each such lease and (vi) such other information as the Administrative Agent may reasonably require. "Required Additional Guarantors": any Subsidiary required to execute and deliver a Guaranty pursuant to Section 7.11. "Required Lenders": means (a) so long as the Commitments remain in effect (i) if no Loans are outstanding at such time, Lenders (other than any Defaulting Lenders) having Commitments equal to at least 51% of the Commitments of all Lenders at such time; or (ii) if Loans are outstanding at such time, Lenders (other than any Defaulting Lenders) holding Notes having an unpaid principal balance equal to at least 51% of the aggregate Loans then outstanding; and (b) if the Commitments have been terminated, Lenders (other than any Defaulting Lenders) whose Loans have an unpaid principal balance equal to at least 51% of the aggregate Loans then outstanding. "Restricted Payment": as to any Person, any dividend or other distribution by such Person (whether in cash, securities or other property) with respect to any shares of any class of equity securities or beneficial interests of such Person, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such shares or beneficial interests or any option, warrant or other right to acquire any such shares or beneficial interests. 22 23 "Senior Debt Rating": the senior unsecured non-credit-enhanced debt rating of the Borrower as determined by S&P and/or Moody's from time to time. "Special Counsel": Long Aldridge & Norman LLP, special counsel to FNB. "S&P": Standard & Poor's Ratings Group. "Stock": any and all shares, rights, interests, participations, warrants, depositary receipts or other equivalents (however designated) of corporate stock, including, without limitation, so-called "phantom stock," preferred stock and common stock. "Subsidiary": as to any Person, any corporation, association, partnership, limited liability company, joint venture or other business entity of which such Person, directly or indirectly, either (i) in respect of a corporation, owns or controls more than 50% of the outstanding Stock having ordinary voting power to elect a majority of the board of directors or similar managing body, irrespective of whether a class or classes shall or might have voting power by reason of the happening of any contingency, or (ii) in respect of an association, partnership, limited liability company, joint venture or other business entity, is entitled to share, either directly or indirectly through an entity described in clause (i) above, in more than 50% of the profits and losses, however determined. "Subsidiary Guarantor" means the Subsidiaries of the Borrower listed on Schedule 4.4 and designated thereof as a Subsidiary Guarantor, each Required Additional Guarantor, and their successors and assigns; and "Subsidiary Guarantors" shall mean all such guarantors, collectively. "Tangible Net Worth": as of any date of determination thereof with respect to the Borrower and its Subsidiaries, determined on a Consolidated basis in accordance with GAAP, the remainder of (i) the amounts which would, in conformity with GAAP, be included under "shareholder's equity" (or any like caption) on a Consolidated balance sheet of the Borrower and its Subsidiaries as at such date, minus (ii) the net book value of all assets of the Borrower and its Subsidiaries on a Consolidated basis (to the extent reflected in the Consolidated balance sheet of the Borrower at such date) which would be treated as intangibles under GAAP, including, without limitation, goodwill (whether representing the excess cost over book value of assets acquired or otherwise), patents, trademarks, trade names, franchises, copyrights, licenses, service marks, rights with respect to the foregoing and deferred charges (including, without limitation, unamortized debt discount and expense, organization costs and research and development costs). "Taxes": any present or future income, stamp or other taxes, levies, imposts, duties, fees, assessments, deductions, withholdings, or other charges of whatever nature, now or hereafter imposed, levied, collected, withheld, or assessed by any Governmental Authority. "Total Capital": on any date, the sum of, without duplication, (i) all Indebtedness of the Borrower and its Subsidiaries on such date which, in accordance with GAAP, is 23 24 considered long term debt of the Borrower and its Subsidiaries, (ii) the amounts which would, in conformity with GAAP, be included under "shareholder's equity" (or any like caption) on a Consolidated balance sheet of the Borrower and its Subsidiaries as at such date, (iii) the value of all issued and outstanding preferred stock of the Borrower as set forth on the balance sheet of the Borrower as at such date, and (iv) all Loans outstanding on such date. "Total Commitment Amount": on any day, the sum of the Commitment Amounts of all Lenders on such day. "Unencumbered Asset": any Operating Property which at any time (i) is wholly owned in fee simple by the Borrower, a wholly owned Subsidiary of the Borrower or a DownREIT Partnership (or is the subject of a Ground Lease), (ii) is free and clear of all Liens (other than Liens permitted under clauses (i), (ii), (iii), (iv), (v) (vi), (viii) and (ix) of Section 8.1), (iii) does not have applicable to it (or to any such Ground Lease) any restriction on the pledge, transfer, mortgage or assignment of such Operating Property or Ground Lease (including any restriction imposed by the organizational documents of any such Subsidiary or DownREIT Partnership), (iv) if owned by any such Subsidiary or DownREIT Partnership, the Stock, partnership interests or membership interests, as the case may be, of such Subsidiary or DownREIT Partnership that are owned by the Borrower or any Subsidiary are not subject to any pledge or security interest in favor of any Person other than the Borrower or a Subsidiary Guarantor, (v) is not an Environmental Risk Property; (vi) does not have, to the best of the Borrower's knowledge, any title, survey, environmental or other defect which could reasonably be expected to materially and adversely affect the value, use or marketability thereof, and (vii) is located within the contiguous 48 states of the continental United States; and "Unencumbered Assets" mean all such Unencumbered Assets, collectively. "Unencumbered Assets Coverage Ratio": on any date of determination the ratio of (i) the sum of all Adjusted Net Operating Income for all Unencumbered Assets of the Borrower and its Subsidiaries on a Consolidated basis, plus the Borrower's Interest in all Adjusted Net Operating Income for all Unencumbered Assets owned by a DownREIT Partnership, in each case for the fiscal quarter most recently then ending, to (ii) the portion of the Consolidated Interest Expense consisting of interest on all unsecured Indebtedness of the Borrower and its Subsidiaries as of such fiscal quarter end. "Unencumbered Asset Value": as of any date the quotient of (i) an amount equal to the Adjusted Net Operating Income for all Unencumbered Assets in the aggregate for the four fiscal quarters of the Borrower most recently ending as of such date, divided by (ii) 10%. For purposes of any determination of Unencumbered Asset Value, the following limitations and methodology shall apply: (A) the Adjusted Net Operating Income of any Unencumbered Asset owned by a DownREIT Partnership shall be based on the Borrower's Interest in the Adjusted Net Operating Income for each such Unencumbered Asset for the four fiscal quarters having ended as of such date; (B) in the event more than 10% of the gross base rents payable under all leases for Properties of the Borrower, its Subsidiaries or a DownREIT Partnership (including the Borrower's Interest in any Property) shall be payable by one tenant and its Subsidiaries, then Unencumbered Asset Value shall be reduced by the percentage amount of such excess multiplied 24 25 by the Unencumbered Asset Value attributable to the Properties leased or controlled by such tenant and its Subsidiaries, and (C) in the event that the Borrower or a Subsidiary of the Borrower shall not have owned an Unencumbered Asset for the entire previous four fiscal quarters, then for the purposes of determining the Unencumbered Asset Value with respect to such Unencumbered Asset, the Adjusted Net Operating Income for such Unencumbered Asset shall be annualized in a manner reasonably satisfactory to the Administrative Agent. 1.2 Other Definitional Provisions . (a) All terms defined in this Agreement shall have the meanings given such terms herein when used in the Loan Documents or any certificate, opinion or other document made or delivered pursuant hereto or thereto, unless otherwise defined therein. (b) As used in the Loan Documents and in any certificate, opinion or other document made or delivered pursuant hereto or thereto, accounting terms not defined in Section 1.1, and accounting terms partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP. (c) The words "hereof", "herein", "hereto" and "hereunder" and similar words when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section, schedule and exhibit references contained herein shall refer to Sections hereof or schedules or exhibits hereto unless otherwise expressly provided herein. (d) The word "or" shall not be exclusive; "may not" is prohibitive and not permissive. (e) Unless the context otherwise requires, words in the singular number include the plural, and words in the plural include the singular. (f) Unless specifically provided in a Loan Document to the contrary, references to time shall refer to Boston, Massachusetts time. 2. AMOUNT AND TERMS OF LOANS. 2.1 Loans . (a) Subject to the terms and conditions set forth in this Agreement, each of the Lenders severally agrees to lend to the Borrower during the Loan Period, upon notice by the Borrower to the Administrative Agent given in accordance with Section 2.3, such sums as are requested by the Borrower for the purposes set forth in Section 2.15 up to the aggregate principal amount of such Lender's Commitment Amount; provided, that, in all events no Default or Event of Default shall have occurred and be continuing and the Borrower's financial statements as required pursuant to Section 7.1 shall demonstrate compliance with all covenants set forth therein; and provided, further, that the outstanding principal amount of the Loans (after giving 25 26 effect to all amounts requested) shall not at any time exceed the Total Commitment Amount. The Loans shall be made pro rata in accordance with each Lender's Commitment Percentage. Each request for a Loan hereunder shall constitute a representation and warranty by the Borrower that all of the conditions set forth in Section 5, in the case of the initial Loan, and Section 6, in the case of all other Loans, have been satisfied on the date of such request. No Lender shall have any obligation to make Loans to the Borrower in the maximum aggregate principal amount outstanding of more than the principal face amount of its Note. Upon the expiration of the Loan Period, any unadvanced portion of the Total Commitment Amount (as same may have been increased pursuant to Section 2(b)), shall terminate and the Total Commitment Amount and each Lender's Commitment Amount shall be reduced accordingly. (b) In consideration for the payment by the Borrower to FNB of an option fee described in the Agreement Regarding Fees, the Borrower shall have the option, to be exercised by giving written notice to the Administrative Agent prior to the Advance Termination Date, to increase the Total Commitment Amount up to $75,000,000.00. The request by the Borrower to increase the Total Commitment Amount by up to such additional $25,000,000.00 shall constitute a representation and warranty by the Borrower that all the conditions set forth in this Section 2.1(b) shall have been satisfied on the date of such request. The Borrower's election shall be subject to the satisfaction of the following conditions precedent: (i) the Borrower shall execute and deliver to the Lenders replacement Notes reflecting each Lender's increased Commitment Amount (each Lender's Commitment Amount shall be increased by such Lender's Commitment Percentage of the amount of the increase requested by the Borrower, up to an additional $25,000,000.00); (ii) the Borrower shall pay to FNB an additional Facility Fee as set forth in the Agreement Regarding Fees, which fee shall, when paid, be fully earned and non-refundable under any circumstances (FNB shall pay to the other Lenders a portion of the Facility Fee pursuant to their separate agreement); (iii) on the date such notice is given, there shall exist no Default or Event of Default; and (iv) the representations and warranties contained in the Loan Documents shall be true and correct in all respects, both immediately before and after giving effect to such request, as though such representations and warranties had been made on the date of such request (except for representations and warranties contained in the Loan Documents that speak as of a specific date, which need only be true and correct as of such date). 2.2 Notes . (a) Notes as Evidence of Indebtedness. The Loans of each Lender shall be evidenced by a promissory note of the Borrower, substantially in the form of Exhibit H, with appropriate insertions therein as to date and principal amount (each, as endorsed or modified 26 27 from time to time, a "Note" and, collectively with the Notes of all other Lenders, the "Notes"), payable to the order of such Lender for the account of its Applicable Lending Office and representing the obligation of the Borrower to pay the lesser of (a) the original amount of the Commitment of such Lender and (b) the aggregate unpaid principal balance of all Loans of such Lender plus interest and other amounts due and owing to the Lenders under the Loan Documents. (b) The Notes Generally. Each Note shall bear interest from the date thereof on the unpaid principal balance thereof at the applicable interest rate or rates per annum determined as provided in Section 2.9 and shall be stated to mature on the Maturity Date. The following information shall be recorded by each Lender on its books and, prior to any transfer of any such Notes, endorsed by such Lender on the schedule attached thereto or any continuation thereof: (i) the date and amount of each Loan of such Lender; (ii) its character as an ABR Advance, a Eurodollar Advance or a combination thereof; (iii) the interest rate and Interest Period applicable to Eurodollar Advances; and (iv) each payment and prepayment of the principal thereof; provided, that the failure of such Lender to make any such recordation or endorsement shall not affect the obligations of the Borrower to make payment when due of any amount owing under the Loan Documents. 2.3 Procedure for Loan Borrowings . (a) Loans. Subject to the limitations set forth in Sections 2.1 and 2.3(c), the Borrower may borrow under the Commitments on any Business Day during the Loan Period by providing notice thereof in accordance with Section 2.3(b). (b) Borrowing Requests. To request Loans pursuant to Section 2.3(a), the Borrower shall notify the Administrative Agent of such request by telephone (a) in the case of a Eurodollar Advance, not later than 12:00 P.M., Boston, Massachusetts time, two Business Days before the date of the proposed borrowing of Loans or (b) in the case of an ABR Advance, not later than 12:00 P.M., Boston, Massachusetts time, one Business Day before the date of such proposed advance. Each such telephonic Borrowing Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Borrowing Request signed by the Borrower. Each such telephonic and written Borrowing Request shall specify the following information: (i) the aggregate amount of the requested borrowing of Loans; (ii) the date of such borrowing of Loans, which shall be a Business Day; (iii) whether the requested Loan is to be an ABR Advance or a Eurodollar Advance; (iv) in the case of a Eurodollar Advance, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term "Interest Period"; and (v) the location and number of the Borrower's account to which funds are to be disbursed, which shall comply with the requirements of Section 2.3(d). (c) Limits on Advances. Each borrowing of (i) ABR Advances shall be in a minimum aggregate principal amount equal to $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the Available Commitment Amount, and (ii) Eurodollar Advances shall be in an aggregate principal amount equal to $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the Available Commitment Amount. 27 28 (d) Funding of Loans. Upon receipt of each notice of borrowing from the Borrower, the Administrative Agent shall promptly notify each Lender of the contents thereof. Subject to its receipt of the notice referred to in the preceding sentence, each Lender will make the amount of its Commitment Percentage of each borrowing of Loans pursuant to this Section available to the Administrative Agent for the account of the Borrower at the office of the Administrative Agent set forth in Section 11.2 not later than 12:30 P.M. on the relevant Borrowing Date requested by the Borrower in funds immediately available to the Administrative Agent at such office. The amounts so made available to the Administrative Agent on the Borrowing Date will then, subject to the satisfaction of the terms and conditions of this Agreement, as determined by the Administrative Agent, be made available on such date to the Borrower by the Administrative Agent at the office of the Administrative Agent specified in Section 11.2 by crediting the account of the Borrower on the books of such office with the aggregate of said amounts received by the Administrative Agent. (e) Effect of Incomplete Borrowing Request. If no election is made as to the whether the Loans shall be ABR Advances or Eurodollar Advances, then the requested Loans shall be an ABR Advance. If no Interest Period is specified with respect to any requested borrowing of Eurodollar Advances, then the Borrower shall be deemed to have selected an Interest Period of one month's duration. (f) Administrative Agent's Assumption. Unless the Administrative Agent shall have received prior notice from a Lender (by telephone or otherwise, such notice to be promptly confirmed by telecopy or other writing) that such Lender will not make available to the Administrative Agent such Lender's pro rata share of the Loans requested by the Borrower, the Administrative Agent may assume that such Lender has made such share available to the Administrative Agent on the Borrowing Date in accordance with this Section, provided that such Lender received notice of the proposed borrowing from the Administrative Agent, and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower on the Borrowing Date a corresponding amount. If and to the extent such Lender shall not have so made such pro rata share available to the Administrative Agent, such Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount (to the extent not previously paid by the other), together with interest thereon for each day from the date such amount is made available to the Borrower until the date such amount is paid to the Administrative Agent, at a rate per annum equal to, in the case of the Borrower, the applicable interest rate set forth in Section 2.9 for ABR Advances or Eurodollar Advances, as set forth in the applicable Conventional Borrowing Request, and, in the case of such Lender, the Federal Funds Rate in effect on each such day (as determined by the Administrative Agent). Such payment by the Borrower, however, shall be without prejudice to its rights against such Lender. If such Lender shall pay to the Administrative Agent such corresponding amount, such amount so paid shall constitute such Lender's Loan as part of the Loans for purposes of this Agreement, which Loan shall be deemed to have been made by such Lender on the Borrowing Date applicable to such Loans, but without prejudice to the Borrower's rights against such Lender. 28 29 2.4 [Intentionally Omitted] . 2.5 Termination or Reduction of Commitments . (a) Voluntary Reductions. The Borrower shall have the right, upon at least three Business Days' prior written notice to the Administrative Agent, at any time to terminate the Commitments or from time to time to permanently reduce the Commitments, provided that (i) the total of the Commitments shall not be reduced below an amount equal to the sum of the aggregate principal balance of the Loans then outstanding thereunder, and (ii) any such reduction of the Commitments shall be in the minimum amount of $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. (b) In General. Reductions of the Commitments shall be applied pro rata according to the Commitments of each Lender, as the case may be. Simultaneously with each reduction of the Commitments under this Section, the Borrower shall prepay the Loans outstanding thereunder by the amount, if any, by which the aggregate unpaid principal balance of such Loans exceeds the amount of the Commitments, as so reduced. If any prepayment is made under this Section with respect to any Advances, in whole or in part, prior to the last day of the applicable Interest Period, the Borrower agrees to indemnify the Lenders in accordance with Section 2.14. No reduction or termination of the Commitments may be reinstated. 2.6 Repayment of Loans; Evidence of Debt . (a) Promise to Pay. The Borrower hereby unconditionally promises to pay to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Loan on the Maturity Date. (b) Lenders' Accounts. Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the debt of the Borrower to such Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder. (c) Administrative Agent's Accounts. The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the type of Advance thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder and (iii) the amount of any other sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender's share thereof. (d) Entries Made in Accounts. The entries made in the accounts maintained pursuant to paragraphs (b) and (c) of this Section shall, to the extent not inconsistent with any entries made in any Note and absent manifest error, be prima facie evidence of the existence and amounts of the obligations recorded therein, provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this 29 30 Agreement. (e) Loans Evidenced by Notes. The Loans and interest thereon shall at all times (including after assignment pursuant to Section 11.7) be represented by one or more Notes in like form payable to the order of the payee named therein and its registered assigns. 2.7 Prepayments of the Loans . (a) Voluntary Prepayments. The Borrower may, at its option, prepay the ABR Advances and Eurodollar Advances, in whole or in part, without premium or penalty (other than any indemnification amounts, as provided for in Section 2.14) at any time and from time to time by notifying the Administrative Agent in writing at least one Business Day prior to the proposed prepayment date in the case of Loans consisting of ABR Advances and at least three Business Days prior to the proposed prepayment date in the case of Loans consisting of Eurodollar Advances, specifying the Loans to be prepaid consisting of ABR Advances, Eurodollar Advances or a combination thereof, the amount to be prepaid and the date of prepayment. Such notice shall be irrevocable and the amount specified in such notice shall be due and payable on the date specified, together with accrued interest to the date of such payment on the amount prepaid. Upon receipt of such notice, the Administrative Agent shall promptly notify each Lender in respect thereof. Partial prepayments of ABR Advances and/or Eurodollar Advances shall be in an aggregate minimum principal amount of $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof, or, if less, the outstanding principal balance thereof. After giving effect to any partial prepayment with respect to Eurodollar Advances which were made (whether as the result of a borrowing or a conversion) on the same date and which had the same Interest Period, the outstanding principal amount of such Eurodollar Advances shall be at least (subject to Section 2.3(c)) $1,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. Any Loans prepaid shall not be readvanced. (b) In General. If any prepayment is made in respect of any Advance, in whole or in part, prior to the last day of the applicable Interest Period, the Borrower agrees to indemnify the Lenders in accordance with Section 2.14. 2.8 Conversions . (a) Conversion Elections. The Borrower may elect from time to time to convert Eurodollar Advances to ABR Advances by giving the Administrative Agent at least one Business Day's prior irrevocable notice of such election, specifying the amount to be so converted, provided, that any such conversion of Eurodollar Advances shall only be made on the last day of the Interest Period applicable thereto. In addition, the Borrower may elect from time to time to convert ABR Advances to Eurodollar Advances or to convert Eurodollar Advances to new Eurodollar Advances by giving the Administrative Agent at least two Business Days' prior irrevocable notice of such election, specifying the amount to be so converted and the initial Interest Period relating thereto, provided that any such conversion of ABR Advances to Eurodollar Advances shall only be made on a Business Day and any such conversion of Eurodollar Advances to new Eurodollar Advances shall only be made on the last day of the 30 31 Interest Period applicable to the Eurodollar Advances which are to be converted to such new Eurodollar Advances. Each such notice shall be in the form of Exhibit M and must be delivered to the Administrative Agent prior to 12:00 noon on the Business Day required by this Section for the delivery of such notices to the Administrative Agent. The Administrative Agent shall promptly provide the Lenders with notice of any such election. ABR Advances and Eurodollar Advances may be converted pursuant to this Section in whole or in part, provided that conversions of ABR Advances to Eurodollar Advances, or Eurodollar Advances to new Eurodollar Advances, shall be in an aggregate principal amount of $5,000,000 or such amount plus a whole multiple of $100,000 in excess thereof. (b) Effect on Conversions if an Event of Default. Notwithstanding anything in this Section to the contrary, no ABR Advance may be converted to a Eurodollar Advance, and no Eurodollar Advance may be converted to a new Eurodollar Advance, if a Default or Event of Default has occurred and is continuing either (i) at the time the Borrower shall notify the Administrative Agent of its election to convert or (ii) on the requested Conversion Date. In such event, such ABR Advance shall be automatically continued as an ABR Advance or such Eurodollar Advance shall be automatically converted to an ABR Advance on the last day of the Interest Period applicable to such Eurodollar Advance. If an Event of Default shall have occurred and be continuing, the Administrative Agent shall, at the request of the Required Lenders, notify the Borrower (by telephone or otherwise) that all, or such lesser amount as the Required Lenders shall designate, of the outstanding Eurodollar Advances shall be automatically converted to ABR Advances, in which event such Eurodollar Advances shall be automatically converted to ABR Advances on the date such notice is given. (c) Conversion not a Borrowing. Each conversion shall be effected by each Lender by applying the proceeds of its new ABR Advance or Eurodollar Advance, as the case may be, to its Advances (or portion thereof) being converted (it being understood that such conversion shall not constitute a borrowing for purposes of Sections 4, 5 or 6). 2.9 Interest Rate and Payment Dates . (a) Prior to Maturity. Except as otherwise provided in Section 2.9(b), prior to the Maturity Date, the Loans shall bear interest on the outstanding principal balance thereof at the applicable interest rate or rates per annum set forth below:
ADVANCES RATE -------- ---- Each ABR Advance Alternate Base Rate plus the Applicable Margin. Each Eurodollar Advance Eurodollar Rate for the applicable Interest Period plus the Applicable Margin.
31 32 (b) Event of Default. After the occurrence and during the continuance of an Event of Default, the outstanding principal balance of the Loans and any overdue interest or other amount payable under the Loan Documents shall bear interest, whether before or after the entry of any judgment thereon, at a rate per annum equal to the Alternate Base Rate plus 2%. (c) Interest Payment Dates. Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan, provided that (i) interest accrued pursuant to paragraph (b) of this Section shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Advance prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion. (d) General. Interest on (i) ABR Advances, to the extent based on the FNB Rate, shall be calculated on the basis of a 365 day year (as the case may be), and (ii) ABR Advances, to the extent based on the Federal Funds Rate, Eurodollar Advances shall be calculated on the basis of a 360-day year, in each case for the actual number of days elapsed, including the first day but excluding the last. Any change in the interest rate on the Loans resulting from a change in the Alternate Base Rate or a Pricing Level shall become effective as of the opening of business on the day on which such change shall become effective. The Administrative Agent shall, as soon as practicable, notify the Borrower and the Lenders of the effective date and the amount of each such change in the Alternate Base Rate or a Pricing Level, but any failure to so notify shall not in any manner affect the obligation of the Borrower to pay interest on the Loans in the amounts and on the dates required. Each determination of the Alternate Base Rate, a Eurodollar Rate or a Pricing Level by the Administrative Agent pursuant to this Agreement shall be conclusive and binding on the Borrower and the Lenders absent manifest error. At no time shall the interest rate payable on the Loans of any Lender, together with the Facility Fee and all other amounts payable under the Loan Documents, to the extent the same are construed to constitute interest, exceed the Highest Lawful Rate. If interest payable to a Lender on any date would exceed the maximum amount permitted by the Highest Lawful Rate, such interest payment shall automatically be reduced to such maximum permitted amount, and interest for any subsequent period, to the extent less than the maximum amount permitted for such period by the Highest Lawful Rate, shall be increased by the unpaid amount of such reduction. Any interest actually received for any period in excess of such maximum allowable amount for such period shall be deemed to have been applied as a prepayment of the Loans. The Borrower acknowledges that to the extent interest payable on ABR Advances is based on the FNB Rate, the FNB Rate is only one of the bases for computing interest on loans made by the Lenders, and by basing interest payable on ABR Advances on the FNB Rate, the Lenders have not committed to charge, and the Borrower has not in any way bargained for, interest based on a lower or the lowest rate at which the Lenders may now or in the future make loans to other borrowers. 2.10 Substituted Interest Rate . In the event that (i) the Administrative Agent shall have reasonably determined 32 33 (which determination shall be conclusive and binding upon the Borrower) that by reason of circumstances affecting the interbank eurodollar market either adequate and reasonable means do not exist for ascertaining the Eurodollar Rate applicable pursuant to Section 2.9 or (ii) the Required Lenders shall have notified the Administrative Agent that they have reasonably determined (which determination shall be conclusive and binding on the Borrower) that the applicable Eurodollar Rate will not adequately and fairly reflect the cost to such Lenders of maintaining or funding loans bearing interest based on such Eurodollar Rate, with respect to any portion of the Loans that the Borrower has requested be made as Eurodollar Advances or Eurodollar Advances that will result from the requested conversion of any portion of the Advances into Eurodollar Advances (each, an "Affected Advance"), the Administrative Agent shall promptly notify the Borrower and the Lenders (by telephone or otherwise, to be promptly confirmed in writing) of such determination, on or, to the extent practicable, prior to the requested Borrowing Date or Conversion Date for such Affected Advances. If the Administrative Agent shall give such notice, (a) any Affected Advances shall be made as ABR Advances, (b) the Advances (or any portion thereof) that were to have been converted to Affected Advances shall be converted to or continued as ABR Advances and (c) any outstanding Affected Advances shall be converted, on the last day of the then current Interest Period with respect thereto, to ABR Advances. Until any notice under clauses (i) or (ii), as the case may be, of this Section has been withdrawn by the Administrative Agent (by notice to the Borrower promptly upon either (x) the Administrative Agent having determined that such circumstances affecting the interbank eurodollar market no longer exist and that adequate and reasonable means do exist for determining the Eurodollar Rate pursuant to Section 2.9 or (y) the Administrative Agent having been notified by such Required Lenders that circumstances no longer render the Advances (or any portion thereof) Affected Advances), no further Eurodollar Advances shall be required to be made by the Lenders nor shall the Borrower have the right to convert all or any portion of the Loans to Eurodollar Advances. 2.11 Taxes; Net Payments . (a) All payments made by the Borrower or Subsidiary Guarantor under the Loan Documents shall be made free and clear of, and without reduction for or on account of, any taxes, levies, imposts, deductions, charges or withholdings required by law to be withheld from any amounts payable under the Loan Documents. A statement setting forth the calculations of any amounts payable pursuant to this paragraph submitted by a Lender to the Borrower shall be conclusive absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. (b) Each Lender which is a foreign corporation within the meaning of Section 1442 of the Code shall deliver to the Borrower such certificates, documents or other evidence as the Borrower may reasonably require from time to time as are necessary to establish that such Lender is not subject to withholding under Section 1441 or 1442 of the Code or as may be necessary to establish, under any law hereafter imposing upon the Borrower, an obligation to withhold any portion of the payments made by the Borrower under the Loan Documents, that payments to the Administrative Agent on behalf of such Lender are not subject to withholding. 33 34 2.12 Illegality . Notwithstanding any other provisions herein, if any law, regulation, treaty or directive hereafter enacted, promulgated, approved or issued, or any change in any presently existing law, regulation, treaty or directive, or in the interpretation or application thereof, shall make it unlawful for any Lender to make or maintain its Eurodollar Advances as contemplated by this Agreement, such Lender shall so notify the Administrative Agent and the Administrative Agent shall forthwith give notice thereof to the other Lenders and the Borrower, whereupon (i) the commitment of such Lender hereunder to make Eurodollar Advances or convert ABR Advances to Eurodollar Advances shall forthwith be suspended and (ii) such Lender's Loans then outstanding as Eurodollar Advances affected hereby, if any, shall be converted automatically to ABR Advances on the last day of the then current Interest Period applicable thereto or within such earlier period as required by law. If the commitment of any Lender with respect to Eurodollar Advances is suspended pursuant to this Section and thereafter it is once again legal for such Lender to make or maintain Eurodollar Advances, such Lender's commitment to make or maintain Eurodollar Advances shall be reinstated and such Lender shall notify the Administrative Agent and the Borrower of such event. Notwithstanding the foregoing, to the extent that the conditions giving rise to the notice requirement set forth in this Section can be eliminated by the transfer of such Credit Party's Loans or Commitment to another of its branches, and to the extent that such transfer is not inconsistent with such Credit Party's internal policies of general application and only if, as determined by such Credit Party in its sole discretion, the transfer of such Loan or Commitment, as the case may be, would not otherwise adversely affect such Loans or such Credit Party, the Borrower may request, and such Lender shall use reasonable efforts to effect, such transfer. 2.13 Increased Costs . In the event that any law, regulation, treaty or directive hereafter enacted, promulgated, approved or issued or any change in any presently existing law, regulation, treaty or directive therein or in the interpretation or application thereof by any Governmental Authority charged with the administration thereof or compliance by any Credit Party (or any corporation directly or indirectly owning or controlling such Credit Party) with any request or directive, whether or not having the force of law, from any central bank or other Governmental Authority, agency or instrumentality: (a) does or shall subject any Credit Party to any Taxes of any kind whatsoever with respect to any Eurodollar Advances or its obligations under this Agreement to make Eurodollar Advances, or change the basis of taxation of payments to any Credit Party of principal, interest or any other amount payable hereunder in respect of its Eurodollar Advances, including any Taxes required to be withheld from any amounts payable under the Loan Documents (except for imposition of, or change in the rate of, tax on the overall net income of such Credit Party or its Applicable Lending Office for any of such Advances by the jurisdiction in which such Credit Party is incorporated or has its principal office or such Applicable Lending Office, including, in the case of Credit Parties incorporated in any State of the United States, 34 35 such tax imposed by the United States); or (b) does or shall impose, modify or make applicable any reserve, special deposit, compulsory loan, assessment, increased cost or similar requirement against assets held by, or deposits of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Credit Party in respect of its Eurodollar Advances, which, in the case of Eurodollar Advances, is not otherwise included in the determination of the Eurodollar Rate; and the result of any of the foregoing is to increase the cost to such Credit Party of making, issuing, renewing, converting or maintaining its Eurodollar Advances or its commitment to make such Eurodollar Advances, or to reduce any amount receivable hereunder in respect of its Eurodollar Advances, then, in any such case, the Borrower shall pay such Credit Party, upon its demand, any additional amounts necessary to compensate such Credit Party for such additional cost or reduction in such amount receivable which such Credit Party deems to be material as determined by such Credit Party; provided, however, that nothing in this Section shall require the Borrower to indemnify the Credit Parties with respect to withholding Taxes for which the Borrower has no obligation under Section 2.11. No failure by any Credit Party to demand compensation for any increased cost during any Interest Period shall constitute a waiver of such Credit Party's right to demand such compensation at any time. A statement setting forth the calculations of any additional amounts payable pursuant to the foregoing sentence submitted by a Credit Party to the Borrower shall be conclusive absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and any of the Commitments or the payment of the Notes and all other amounts payable under the Loan Documents. Failure to demand compensation pursuant to this Section shall not constitute a waiver of such Credit Party's right to demand such compensation. To the extent that any increased costs of the type referred to in this Section are being incurred by a Credit Party and such costs can be eliminated or reduced by the transfer of such Credit Party's Loans or Commitment to another of its branches, and to the extent that such transfer is not inconsistent with such Credit Party's internal policies of general application and only if, as determined by such Credit Party in its sole discretion, the transfer of such Loan or Commitment, as the case may be, would not otherwise materially adversely affect such Loan or such Credit Party, the Borrower may request, and such Lender shall use reasonable efforts to effect, such transfer. 2.14 Indemnification for Break Funding Losses . Notwithstanding anything contained herein to the contrary, if (i) the Borrower shall fail to borrow or convert on a Borrowing Date or Conversion Date after it shall have given notice to do so in which it shall have requested a Eurodollar Advance pursuant to Section 2.3 or 2.8, or (ii) a Eurodollar Advance shall be terminated or prepaid for any reason prior to the last day of the Interest Period applicable thereto (including, without limitation, any mandatory prepayment or a prepayment resulting from acceleration or illegality), the Borrower agrees to indemnify each Credit Party against, and to pay on demand directly to such Credit Party, any loss or expense suffered by such Credit Party as a result of such failure to borrow or convert, or such termination or repayment, including, without limitation, an amount, if greater than zero, equal to: 35 36 A x (B-C) x D --- 360 where: "A" equals such Credit Party's pro rata share of the Affected Principal Amount; "B" equals the applicable Eurodollar Rate; "C" equals the applicable Eurodollar Rate (expressed as a decimal) in effect on or about the first day of the applicable Remaining Interest Period, based on the applicable rates offered or bid, as the case may be, on or about such date, for deposits in an amount equal approximately to such Credit Party's pro rata share of the Affected Principal Amount with an Interest Period equal approximately to the applicable Remaining Interest Period, as determined by such Credit Party; "D" equals the number of days from and including the first day of the applicable Remaining Interest Period to but excluding the last day of such Remaining Interest Period; and any other out-of-pocket loss or expense (including any internal processing charge customarily charged by such Credit Party) suffered by such Credit Party in connection with such Eurodollar Advance, including, without limitation, in liquidating or employing deposits acquired to fund or maintain the funding of its pro rata share of the Affected Principal Amount, or redeploying funds prepaid or repaid, in amounts which correspond to its pro rata share of the Affected Principal Amount. A statement setting forth the calculations of any amounts payable pursuant to this Section submitted by a Credit Party to the Borrower shall be conclusive and binding on the Borrower absent manifest error. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 2.15 Use of Proceeds . The proceeds of Loans shall be used solely for (i) acquisition of Borrower's common stock; and (ii) general business purposes, including, without limitation, working capital and refinancing of existing Indebtedness, and such use shall conform to the provisions of Section 4.11. 2.16 Capital Adequacy . If (i) after the date hereof, the enactment or promulgation of, or any change or phasing in of, any United States or foreign law or regulation or in the interpretation thereof by any Governmental Authority charged with the administration thereof, (ii) compliance with any 36 37 directive or guideline from any central bank or United States or foreign Governmental Authority (whether or not having the force of law) promulgated or made after the date hereof, or (iii) compliance with the Risk-Based Capital Guidelines of the Board of Governors of the Federal Reserve System as set forth in 12 CFR Parts 208 and 225, or of the Comptroller of the Currency, Department of the Treasury, as set forth in 12 CFR Part 3, or similar legislation, rules, guidelines, directives or regulations under any applicable United States or foreign Governmental Authority affects or would affect the amount of capital required to be maintained by a Credit Party (or any lending office of such Credit Party) or any corporation directly or indirectly owning or controlling such Credit Party or imposes any restriction on or otherwise adversely affects such Credit Party (or any lending office of such Credit Party) or any corporation directly or indirectly owning or controlling such Credit Party and such Credit Party shall have reasonably determined that such enactment, promulgation, change or compliance has the effect of reducing the rate of return on such Credit Party's capital or the asset value to such Credit Party of any Loan made by such Credit Party as a consequence, directly or indirectly, of its obligations to make and maintain the funding of its Loans at a level below that which such Credit Party could have achieved but for such enactment, promulgation, change or compliance (after taking into account such Credit Party's policies regarding capital adequacy) by an amount deemed by such Credit Party to be material, then, upon demand by such Credit Party, the Borrower shall promptly pay to such Credit Party such additional amount or amounts as shall be sufficient to compensate such Credit Party for such reduction in such rate of return or asset value. A certificate in reasonable detail as to such amounts submitted to the Borrower and the Administrative Agent setting forth the determination of such amount or amounts that will compensate such Credit Party for such reductions shall be presumed correct absent manifest error. No failure by any Credit Party to demand compensation for such amounts hereunder shall constitute a waiver of such Credit Party's right to demand such compensation at any time. Such Credit Party shall, however, use reasonable efforts to notify the Borrower of such claim within 90 days after the officer of such Credit Party having primary responsibility for this Agreement has obtained knowledge of the events giving rise to such claim. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 2.17 Administrative Agent's Records . The Administrative Agent's records with respect to the Loans, the interest rates applicable thereto, each payment by the Borrower of principal and interest on the Loans, and fees, expenses and any other amounts due and payable in connection with this Agreement shall be presumptively correct absent manifest error as to the amount of the Loans, and the amount of principal and interest paid by the Borrower in respect of such Loans and as to the other information relating to the Loans, and amounts paid and payable by the Borrower hereunder and under the Notes. The Administrative Agent will when requested by the Borrower advise the Borrower of the principal and interest outstanding under the Loans as of the date of such request and the dates on which such payments are due. 2.18 [Intentionally Omitted] . 37 38 3. FEES; PAYMENTS. 3.1 Facility Fee . (a) The Borrower agrees to pay to the Administrative Agent on the Effective Date and, if applicable, on the date the Borrower exercises its option to increase the Total Commitment Amount pursuant to Section 2.1(b), for the account of the Lenders in accordance with each Lender's separate agreement with Administrative Agent, a fee (the "Facility Fee"), as provided in the Agreement Regarding Fees. (b) The Borrower agrees to pay any other fees payable to any Credit Party under any separate agreement at the times so agreed upon in such separate agreements. (c) The Facility Fee shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution directly to the Credit Party to whom such Facility Fee is payable. The Facility Fee shall not be refundable under any circumstances. 3.2 Payments; Application of Payments . Each payment, including each prepayment, of principal and interest on the Loans and the Facility Fee shall be made by the Borrower to the Administrative Agent, without set-off, deduction or counterclaim, at its office set forth in Section 11.2 in funds immediately available to the Administrative Agent at such office by 12:00 noon on the due date for such payment. Promptly upon receipt thereof by the Administrative Agent, the Administrative Agent shall remit, in like funds as received, to the Lenders who maintain any of their Loans as ABR Advances or Eurodollar Advances, each such Lender's pro rata share of such payments which are in respect of principal or interest due on such ABR Advances or Eurodollar Advances. The failure of the Borrower to make any such payment by such time shall not constitute a default hereunder, provided that such payment is made on such due date, but any such payment made after 12:00 noon on such due date shall be deemed to have been made on the next Business Day for the purpose of calculating interest on amounts outstanding on the Loans. If any payment hereunder or under the Notes shall be due and payable on a day which is not a Business Day, the due date thereof (except as otherwise provided in the definition of Interest Period) shall be extended to the next Business Day and (except with respect to payments in respect of the Facility Fee) interest shall be payable at the applicable rate specified herein during such extension. If any payment is made with respect to any Eurodollar Advance prior to the last day of the applicable Interest Period, the Borrower shall indemnify each Lender in accordance with Section 2.14. 4. REPRESENTATIONS AND WARRANTIES. In order to induce the Administrative Agent and the Lenders to enter into this Agreement and to make the Loans the Borrower makes the following representations and warranties to the Administrative Agent and each Lender: 4.1 Existence and Power . 38 39 (a) The Borrower is a Maryland corporation duly organized and validly existing and in good standing under the laws of Maryland, has all requisite power and authority to own its Property and to carry on its business as now conducted, and is in good standing and authorized to do business in each jurisdiction in which the nature of the business conducted therein or the Property owned therein make such qualification necessary, except where such failure to qualify could not reasonably be expected to have a Material Adverse Effect. (b) Each Subsidiary of the Borrower (including each Subsidiary Guarantor) is a corporation, partnership, limited liability company, real estate investment trust or business trust, is validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to own its Property and to carry on its business as now conducted, and is in good standing and authorized to do business in each other jurisdiction in which the nature of the business conducted therein or the Property owned therein make such qualification necessary, except where such failure to qualify could not reasonably be expected to have a Material Adverse Effect. 4.2 Authority. The Borrower has full legal power and authority to enter into, execute, deliver and perform the terms of the Loan Documents to which it is a party and to make the borrowings contemplated thereby, to execute, deliver and carry out the terms of the Notes and to incur the obligations provided for herein and therein, all of which have been duly authorized by all proper and necessary corporate action. 4.3 Binding Agreement. (a) The Loan Documents to which the Borrower is a party constitute the valid and legally binding obligations of the Borrower, enforceable in accordance with their respective terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization or other similar laws affecting the enforcement of creditors' rights generally. (b) The execution, delivery and performance by the Borrower of the Loan Documents to which it is a party does not violate the provisions of any applicable statute, law (including, without limitation, any applicable usury or similar law), rule or regulation of any Governmental Authority. 4.4 Subsidiaries; DownREIT Partnerships. As of the Effective Date, the Borrower has only the Subsidiaries set forth on Schedule 4.4. Schedule 4.4 sets forth the name of, and the ownership interest of the Borrower in, each Subsidiary of the Borrower and identifies each Subsidiary that is a Subsidiary Guarantor, in each case as of the Effective Date. The shares of each corporate Subsidiary of the Borrower that are owned by the Borrower are duly authorized, validly issued, fully paid and nonassessable and are owned free and clear of any Liens. The interest of the Borrower in each non-corporate 39 40 Subsidiary is owned free and clear of any Liens (other than Liens applicable to a partner under the terms of any partnership agreement to secure the Borrower's obligation to make capital contributions or similar payments thereunder). As of the Effective Date, the only DownREIT Partnerships are Excel Realty Partners, L.P. and E.H. Properties, L.P. 4.5 Litigation. (a) There are no actions, suits or proceedings at law or in equity or by or before any Governmental Authority (whether or not purportedly on behalf of the Borrower or any Subsidiary of the Borrower) pending or, to the knowledge of the Borrower, threatened against the Borrower or any Subsidiary of the Borrower or any of their respective Properties or rights, which (i) if adversely determined, could reasonably be expected to have a Material Adverse Effect, (ii) call into question the validity or enforceability of any of the Loan Documents, or (iii) could reasonably be expected to result in the rescission, termination or cancellation of any franchise, right, license, permit or similar authorization held by the Borrower or any Subsidiary of the Borrower, which rescission, termination or cancellation could reasonably be expected to have a Material Adverse Effect. (b) As of the date hereof, Schedule 4.5 sets forth all actions, suits and proceedings at law or in equity or by or before any Governmental Authority (whether or not purportedly on behalf of the Borrower or any Subsidiary of the Borrower) pending or, to the knowledge of the Borrower, threatened against the Borrower, any Subsidiary of the Borrower or any of their respective Properties or rights which, if adversely determined, could have a Material Adverse Effect. 4.6 Required Consents. No consent, authorization or approval of, filing with, notice to, or exemption by, stockholders, any Governmental Authority or any other Person not obtained is required to be obtained by the Borrower to authorize, or is required in connection with the execution, delivery and performance of the Loan Documents or is required to be obtained by the Borrower as a condition to the validity or enforceability of the Loan Documents. 4.7 No Conflicting Agreements. Neither the Borrower nor any Subsidiary of the Borrower is in default beyond any applicable grace or cure period under any mortgage, indenture, contract or agreement to which it is a party or by which it or any of its Property is bound, the effect of which default could reasonably be expected to have a Material Adverse Effect. The execution, delivery or carrying out of the terms of the Loan Documents will not constitute a default under, or result in the creation or imposition of, or obligation to create, any Lien upon any Property of the Borrower or any Subsidiary of the Borrower pursuant to the terms of any such mortgage, indenture, contract or agreement. 4.8 Compliance with Applicable Laws. 40 41 Neither the Borrower nor any Subsidiary of the Borrower is in default with respect to any judgment, order, writ, injunction, decree or decision of any Governmental Authority which default could reasonably be expected to have a Material Adverse Effect. The Borrower and each Subsidiary of the Borrower is in compliance in all material respects with all statutes, regulations, rules and orders applicable to Borrower or such Subsidiary of all Governmental Authorities, including, without limitation, (i) Environmental Laws and ERISA, a violation of which could reasonably be expected to have a Material Adverse Effect and (ii) Sections 856-860 of the Code, compliance with which is required to preserve the Borrower's status as a REIT. 4.9 Taxes. Each of the Borrower and its Subsidiaries has filed or caused to be filed all tax returns required to be filed and has paid, or has filed appropriate extensions and has made adequate provision for the payment of, all taxes shown to be due and payable on said returns or in any assessments made against it (other than those being contested as permitted under Section 7.4) in which the failure to pay could reasonably be expected to have a Material Adverse Effect, and no tax Liens have been filed with respect thereto. The charges, accruals and reserves on the books of the Borrower and each Subsidiary of the Borrower with respect to all federal, state, local and other taxes are, to the best knowledge of the Borrower, adequate for the payment of all such taxes, and the Borrower knows of no unpaid assessment which is due and payable against it or any of its Subsidiaries or any claims being asserted which could reasonably be expected to have a Material Adverse Effect. 4.10 Governmental Regulations. Neither the Borrower nor any Subsidiary of the Borrower is subject to regulation under the Public Utility Holding Company Act of 1935, as amended, the Federal Power Act, as amended, or the Investment Company Act of 1940, as amended, and neither the Borrower nor any Subsidiary of the Borrower is subject to any statute or regulation which prohibits or restricts the incurrence of Indebtedness under the Loan Documents, including, without limitation, statutes or regulations relative to common or contract carriers or to the sale of electricity, gas, steam, water, telephone, telegraph or other public utility services. 4.11 Federal Reserve Regulations; Use of Loan Proceeds. Neither the Borrower nor any Subsidiary of the Borrower is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. No part of the proceeds of the Loans will be used, directly or indirectly, for a purpose which violates any law, rule or regulation of any Governmental Authority, including, without limitation, the provisions of Regulations T, U or X of the Board of Governors of the Federal Reserve System, as amended. No part of the proceeds of the Loans will be used, directly or indirectly, to purchase or carry Margin Stock or to extend credit to others for the purpose of purchasing or carrying Margin Stock. 41 42 4.12 Plans; Multiemployer Plans. As of the Effective Date, each of the Borrower and its ERISA Affiliates maintains or makes contributions only to the Plans and Multiemployer Plans listed on Schedule 4.12. Each Plan, and, to the best knowledge of the Borrower, each Multiemployer Plan, is in compliance in all material respects with, and has been administered in all material respects in compliance with, the applicable provisions of ERISA, the Code and any other applicable Federal or state law, and no event or condition is occurring or exists concerning which the Borrower would be under an obligation to furnish a report to the Administrative Agent and each Lender as required by Section 7.2(d). As of December 31, 1998, each Plan was "fully funded", which for purposes of this Section means that the fair market value of the assets of such Plan is not less than the present value of the accrued benefits of all participants in the Plan, computed on a plan termination basis. To the best knowledge of the Borrower, no Plan has ceased being fully funded. 4.13 Financial Statements. The Borrower has heretofore delivered to the Administrative Agent and the Lenders (i) copies of the audited Consolidated Balance Sheet of the Borrower and its Consolidated Subsidiaries as of December 31, 1998, and the related Consolidated Statements of Operations, Stockholders' Equity and Cash Flows for the Borrower and its Consolidated Subsidiaries for the five months ended December 31, 1998 and the 12 months ended July 31, 1999, and (ii) the Consolidated Statements of Income and Cash Flows for the Borrower and its Consolidated Subsidiaries for the fiscal quarters of the Borrower ending March 31, 1999, June 30, 1999 and September 30, 1999, certified by its Chief Financial Officer (collectively, with the related notes and schedules, the "Financial Statements"). The Financial Statements fairly present the Consolidated financial condition and results of the operations of the Borrower and its Consolidated Subsidiaries as of the dates and for the periods indicated therein and have been prepared in conformity with GAAP. Except as reflected in the Financial Statements or in the notes thereto, neither the Borrower nor any Subsidiary of the Borrower has any obligation or liability of any kind (whether fixed, accrued, contingent, unmatured or otherwise) which, in accordance with GAAP, should have been shown on the Financial Statements and was not. Since June 30, 1999 through the Effective Date there has been no material adverse change in the financial condition or business of the Borrower and its Subsidiaries taken as a whole. 4.14 Property. Each of the Borrower and its Subsidiaries has good and marketable title to all of its Property, title to which is material to the Borrower or such Subsidiary, subject to no Liens, except Permitted Liens. There are no unpaid or outstanding real estate or similar taxes or assessments on or against any Real Property other than (i) real estate or other taxes or assessments that are not yet due and payable, and (ii) such taxes as the Borrower or any Subsidiary of the Borrower is contesting in good faith or which individually or in the aggregate could not reasonably be expected to have a Materially Adverse Effect. There are no pending eminent domain proceedings against any Real Property, and, to the knowledge of the Borrower, no such proceedings are presently threatened or contemplated by any Governmental Authority 42 43 against any Real Property, which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect. None of the Real Property is now damaged as a result of any fire, explosion, accident, flood or other casualty which individually or in the aggregate could reasonably be expected to have a Material Adverse Effect. 4.15 Franchises, Intellectual Property, Etc. Each of the Borrower and its Subsidiaries possesses or has the right to use all franchises, Intellectual Property, licenses and other rights, in each case that are material and necessary for the conduct of its business, with no known conflict with the valid rights of others which could reasonably be expected to have a Material Adverse Effect. No event has occurred which permits or, to the best knowledge of the Borrower, after notice or the lapse of time or both, or any other condition, could reasonably be expected to permit, the revocation or termination of any such franchise, Intellectual Property, license or other right and which revocation or termination could reasonably be expected to have a Material Adverse Effect. 4.16 Environmental Matters. (a) The Borrower and each of its Subsidiaries is in compliance with the requirements of all applicable Environmental Laws except for such non-compliance which could not, either individually or in the aggregate, be reasonably expected to have a Material Adverse Effect. (b) No Hazardous Substances have been (i) generated or manufactured on, transported to or from, treated at, stored at or discharged from any Real Property in violation of any Environmental Laws; (ii) discharged into subsurface waters under any Real Property in violation of any Environmental Laws; or (iii) discharged from any Real Property on or into property or waters (including subsurface waters) adjacent to any Real Property in violation of any Environmental Laws, which violation, in the case of either (i), (ii) or (iii) could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. (c) Neither the Borrower nor any of its Subsidiaries (i) has received notice (written or oral) or otherwise learned of any claim, demand, suit, action, proceeding, event, condition, report, directive, lien, violation, non-compliance or investigation indicating or concerning any potential or actual liability (including, without limitation, potential liability for enforcement, investigatory costs, cleanup costs, government response costs, removal costs, remedial costs, natural resources damages, property damages, personal injuries or penalties) arising in connection with (x) any non-compliance with or violation of the requirements of any applicable Environmental Laws, or (y) the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by the Borrower or any Subsidiary of the Borrower) or the release or threatened release of any Hazardous Substance into the environment which, in either case, could, either individually or 43 44 in the aggregate, reasonably be expected to have a Material Adverse Effect, (ii) has any threatened or actual liability in connection with the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by the Borrower or any Subsidiary of the Borrower) or the release or threatened release of any Hazardous Substance into the environment which, in either case, could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (iii) has received notice of any federal or state investigation evaluating whether any remedial action is needed to respond to the presence of any Hazardous Substance on any Real Property (or any Real Property previously owned by the Borrower or any Subsidiary of the Borrower) or a release or threatened release of any Hazardous Substance into the environment for which the Borrower or any Subsidiary of the Borrower is or may be liable the results of which could, in either case, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, or (iv) has received notice that the Borrower or any Subsidiary of the Borrower is or may be liable to any Person under any Environmental Law which liability could, either individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. (d) To the best of the Borrower's knowledge, no Real Property is located in an area identified by the Secretary of Housing and Urban Development as an area having special flood hazards, or if any such Real Property is located in such a special flood hazard area, then the Borrower has obtained all insurance that is required to be maintained by law or which is customarily maintained by Persons engaged in similar businesses and owning similar Properties in the same general areas in which the Borrower operates. 4.17 Labor Relations. Neither the Borrower nor any of its Subsidiaries is a party to any collective bargaining agreement, other than the collective bargaining agreement covering fewer than 10 employees at the Roosevelt Mall Shopping Center in Philadelphia, Pennsylvania, and, to the best knowledge of the Borrower, no petition has been filed or proceedings instituted by any employee or group of employees with any labor relations board seeking recognition of a bargaining representative with respect to the Borrower or such Subsidiary. There are no material controversies pending between the Borrower or any Subsidiary and any of their respective employees, which could reasonably be expected to have a Material Adverse Effect. 4.18 Burdensome Obligations. Neither the Borrower nor any of its Subsidiaries is a party to or bound by any franchise, agreement, deed, lease or other instrument, or subject to any corporate restriction which, in the opinion of the management of the Borrower or such Subsidiary, is so unusual or burdensome, in the context of its business, as in the foreseeable future might adversely affect or impair the revenue or cash flow of the Borrower or such Subsidiary in such a manner as could reasonably be expected to have a Material Adverse Effect, or materially and adversely affect or impair the ability of the Borrower or such Subsidiary to perform its obligations under the Loan Documents. The Borrower does not presently anticipate that future expenditures by the Borrower or any Subsidiary of the Borrower needed to meet the provisions of federal or state statutes, orders, rules or regulations will be so burdensome as to result in a Material Adverse Effect. 4.19 Solvency. 44 45 On the Effective Date and immediately following the making of each Loan, and after giving effect to the application of the proceeds of such Loan: (a) the fair value of the assets of the Borrower and its Subsidiaries, taken as a whole, at a fair valuation, will exceed the debts and liabilities, including Contingent Obligations, of the Borrower and its Subsidiaries, taken as a whole; (b) the present fair saleable value of the property of the Borrower and its Subsidiaries, taken as a whole, will be greater than the amount that will be required to pay the probable liability of the debts and other liabilities, subordinated, contingent or otherwise of the Borrower and its Subsidiaries, as such debts and other liabilities become absolute and matured; (c) the Borrower and its Subsidiaries, taken as a whole, will be able to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (d) the Borrower and its Subsidiaries, taken as a whole, will not have unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted hereafter. 4.20 REIT Status. The Borrower (i) has made an election pursuant to Section 856 of the Code to qualify as a REIT, (ii) has satisfied and continues to satisfy all of the requirements under Sections 856-859 of the Code and the regulations and rulings issued thereunder which must be satisfied for the Borrower to maintain its status as a REIT, and (iii) is in compliance in all material respects with all Code sections applicable to REITs generally and the regulations and rulings issued thereunder. 4.21 Rent Roll and List of Unencumbered Assets. A list of all the Unencumbered Assets of the Borrower as of the date of this Agreement is attached hereto as Schedule 4.21. Upon the request of the Administrative Agent, Borrower will provide the Administrative Agent with a Rent Roll. 4.22 [Intentionally Omitted]. 4.23 Operation of Business. The Borrower is a self-advised, and self-managed REIT. 4.24 No Misrepresentation. No representation or warranty contained herein and no certificate or report furnished or to be furnished by the Borrower or any Subsidiary of the Borrower in connection with the transactions contemplated hereby, contains or will contain a misstatement of material fact, or, to the best knowledge of the Borrower, omits or will omit to state a material fact required to be stated in order to make the statements herein or therein contained not misleading in the light of the circumstances under which made. 5. CONDITIONS TO FIRST LOANS. 45 46 In addition to the conditions precedent set forth in Section 6, the obligation of each Lender to make its first Loan shall be subject to the fulfillment of the following conditions precedent: 5.1 Evidence of Action. 46 47 (a) The Administrative Agent shall have received a certificate, dated the first Borrowing Date, of the Secretary or Assistant Secretary of the Borrower substantially in the form of Exhibit I (i) attaching a true and complete copy of the resolutions of its Board of Directors authorizing the execution and delivery of the Loan Documents by the Borrower and the performance of the Borrower's obligations thereunder, and of all other documents evidencing other necessary action (in form and substance reasonably satisfactory to the Administrative Agent) taken by it to authorize the Loan Documents and the transactions contemplated thereby, (ii) attaching a true and complete copy of its articles of incorporation and by-laws, (iii) setting forth the incumbency of its officer or officers who may sign the Loan Documents, including therein a signature specimen of such officer or officers, and (iv) certifying that said corporate charter and by-laws are true and complete copies thereof, are in full force and effect and have not been amended or modified. (b) The Administrative Agent shall have received a certificate, dated the first Borrowing Date, of the Secretary or Assistant Secretary of each Subsidiary Guarantor substantially in the form of Exhibit J (i) attaching a true and complete copy of the resolutions of its Board of Directors or Trustees, as the case may be, authorizing its execution and delivery of the Guaranty and the performance of its obligations thereunder, and of all other documents evidencing other necessary action (in form and substance reasonably satisfactory to the Administrative Agent) taken by it to authorize the Guaranty and the transactions contemplated thereby, (ii) attaching a true and complete copy of its articles of incorporation or corporate charter or declaration of trust and, if applicable, by-laws, (iii) setting forth the incumbency of its officer or officers who may sign the Guaranty, including therein a signature specimen of such officer or officers, and (iv) certifying that said articles of incorporation, corporate charter or declaration of trust and, if applicable, by-laws, are true and complete copies thereof, is in full force and effect and has not been amended or modified. (c) The Administrative Agent shall have received certificates of good standing for the Borrower from the Maryland State Department of Assessments and Taxation and for each Subsidiary Guarantor from the Secretary of State for the State in which such Subsidiary Guarantor is incorporated, and for the Borrower from each jurisdiction other than Maryland in which the Borrower is qualified to do business, provided that such Secretaries issue such certificates with respect to the Borrower. Notwithstanding the Administrative Agent's acceptance on the Effective Date of certificates of good standing obtained in connection with the closing under the Existing Credit Agreements, the Borrower shall provide the Administrative Agent with current copies of such certificates of good standing within fifteen (15) days of the Effective Date. 5.2 This Agreement. The Administrative Agent shall have received counterparts of this Agreement signed by each of the parties hereto (or receipt by the Administrative Agent from a party hereto of a facsimile signature page signed by such party which shall have agreed to promptly provide the Administrative Agent with originally executed counterparts hereof). 5.3 Notes. 47 48 The Administrative Agent shall have received the Notes, duly executed by an Authorized Signatory of the Borrower. 5.4 Guaranty. The Administrative Agent shall have received counterparts of the Guaranty signed by each of the Subsidiary Guarantors (or receipt by the Administrative Agent from a party hereto of a facsimile signature page signed by such party which shall have agreed to promptly provide the Administrative Agent with originally executed counterparts hereof). 5.5 [Intentionally Omitted]. 5.6 Litigation. There shall be no injunction, writ, preliminary restraining order or other order of any nature issued by any Governmental Authority in any respect affecting the transactions provided for herein and no action or proceeding by or before any Governmental Authority shall have been commenced and be pending or, to the knowledge of the Borrower, threatened, seeking to prevent or delay the transactions contemplated by the Loan Documents or challenging any other terms and provisions hereof or thereof or seeking any damages in connection therewith and the Administrative Agent shall have received a certificate of an Authorized Signatory of the Borrower to the foregoing effects. 5.7 Opinion of Counsel to the Borrower. The Administrative Agent shall have received an opinion of (i) Hogan & Hartson, L.L.P., outside counsel to the Borrower, and (ii) Steven F. Siegel, Esq., in-house counsel to the Borrower, and (iii) counsel to each Subsidiary Guarantor, each addressed to the Administrative Agent and the Lenders, and each dated the first Borrowing Date, covering the matters set forth in Exhibit K. 5.8 Fees. The Facility Fee, to the extent then due and payable, and all fees payable to the Administrative Agent, the Lead Arranger and the Lenders shall have been paid. 5.9 Fees and Expenses of Special Counsel. The fees and expenses of Special Counsel in connection with the preparation, negotiation and closing of the Loan Documents shall have been paid. 5.10 [Intentionally Omitted]. 6. CONDITIONS OF LENDING - ALL LOANS. 48 49 The obligation of each Lender to make any Loan is subject to the satisfaction of the following conditions precedent as of the date of such Loan: 6.1 Compliance. On each Borrowing Date and after giving effect to the Loans to be made or created, (a) the Borrower shall be in compliance with all of the terms, covenants and conditions hereof, (b) there shall not exist and be continuing any Default or Event of Default, (c) the representations and warranties contained in the Loan Documents shall be true and correct with the same effect as though such representations and warranties had been made on such Borrowing Date (except for representations and warranties that speak as of a specific date, which need only be true and correct as of such date), and (d) the aggregate outstanding principal balance of the Loans shall not exceed the Total Commitment Amount. Each notice requesting a Loan shall be deemed to constitute a representation and warranty by the Borrower on the date thereof that each of the foregoing matters is true and correct in all respects. 6.2 Loan Closings. All documents required by the provisions of the Loan Documents to be executed or delivered to the Administrative Agent on or before the applicable Borrowing Date shall have been executed and shall have been delivered at the office of the Administrative Agent set forth in Section 11.2 on or before such Borrowing Date. 6.3 Borrowing Request. With respect to each borrowing of a Loan, the Administrative Agent shall have received a Borrowing Request duly executed by an Authorized Signatory of the Borrower. 6.4 Documentation and Proceedings. All corporate matters and legal proceedings and all documents and papers in connection with the transactions contemplated by the Loan Documents shall be reasonably satisfactory in form and substance to the Administrative Agent and the Administrative Agent shall have received all information and copies of all documents which the Administrative Agent or the Required Lenders may reasonably have requested in connection therewith, such documents (where appropriate) to be certified by an Authorized Signatory of the Borrower or proper Governmental Authorities. 6.5 Required Acts and Conditions. All acts, conditions and things (including, without limitation, the obtaining of any necessary regulatory approvals and the making of any filings, recordings or registrations) required to be done or performed by the Borrower and to have happened on or prior to such Borrowing Date and which are necessary for the continued effectiveness of the Loan Documents, 49 50 shall have been done or performed and shall have happened in due compliance with all applicable laws. 6.6 Approval of Special Counsel. All legal matters in connection with the making of each Loan shall be reasonably satisfactory to Special Counsel. 6.7 Supplemental Opinions. If reasonably requested by the Administrative Agent with respect to the applicable Borrowing Date, there shall have been delivered to the Administrative Agent favorable supplementary opinions of counsel to the Borrower, addressed to the Administrative Agent and the Lenders and dated such Borrowing Date, covering such matters incident to the transactions contemplated herein as the Administrative Agent may reasonably request. 6.8 Other Documents. The Administrative Agent shall have received such other documents and information with respect to the Borrower and its Subsidiaries or the transactions contemplated hereby as the Administrative Agent or the Lenders shall reasonably request. 7. AFFIRMATIVE COVENANTS. The Borrower agrees that, so long as any Loan remains outstanding and unpaid, any other amount is owing under any Loan Document to any Lender or the Administrative Agent, or any Lender shall have any obligation to make or maintain any Loan, the Borrower shall: 7.1 Financial Statements. Maintain a standard system of accounting in accordance with GAAP, and furnish or cause to be furnished to the Administrative Agent and each Lender: (a) Annual Statements. As soon as available, but in any event within 120 days after the end of each fiscal year of the Borrower, a copy of its Consolidated Balance Sheet as at the end of such fiscal year, together with the related Consolidated Statements of Income, Stockholders' Equity and Cash Flows as of and through the end of such fiscal year, setting forth in each case in comparative form the figures for the preceding fiscal year. The Consolidated Balance Sheets and Consolidated Statements of Income, Stockholders' Equity and Cash Flows shall be audited and certified without qualification by the Accountants, which certification shall (i) state that the examination by such Accountants in connection with such Consolidated financial statements has been made in accordance with generally accepted auditing standards and, accordingly, includes the examination, on a test basis, of evidence supporting the amounts and disclosures in such Consolidated financial statements, and (ii) include the opinion of such Accountants that such Consolidated financial statements present fairly, in all material respects, 50 51 the Consolidated financial position of the Borrower and its Subsidiaries, as of the date of such Consolidated financial statements, and the Consolidated results of their operations and their cash flows for each of the years identified therein in conformity with GAAP (subject to any change in the requirements of GAAP). (b) Annual Operating Statements and Rent Roll. As soon as available, but in any event within 60 days after the end of each fiscal year of the Borrower, copies of (i) the operating statements (in a form reasonably satisfactory to the Administrative Agent) for all Real Property of the Borrower, and (ii) a Rent Roll, each of which shall be certified by the Chief Financial Officer to be true, correct and complete in all material respects. (c) Quarterly Statements. As soon as available, but in any event within 60 days after the end of the first three fiscal quarters of the Borrower, a copy of the unaudited Consolidated Balance Sheet of the Borrower as at the end of each such quarterly period, together with the related unaudited Consolidated Statements of Income and Cash Flows for the elapsed portion of the fiscal year through the end of such period, setting forth in each case in comparative form the figures for the corresponding periods of the preceding fiscal year, certified by the Chief Financial Officer as being true, correct and complete in all material respects and as presenting fairly the Consolidated financial condition and the Consolidated results of operations of the Borrower and its Subsidiaries. (d) Quarterly Information Regarding Unencumbered Assets. As soon as available, but in any event 60 days after the end of each of the first three fiscal quarters of the Borrower (120 days after the end of the last fiscal quarter of the Borrower), a list of all the Unencumbered Assets owned by the Borrower, any wholly owned Subsidiary of the Borrower and each DownREIT Partnership as of the last day of such fiscal quarter setting forth the following information with respect to each such Unencumbered Asset as of such date: (i) asset type (i.e., retail shopping center or residential apartment building); (ii) location; (iii) percentage of the Unencumbered Asset owned by the Borrower, any wholly owned Subsidiary of the Borrower and each DownREIT Partnership; and (iv) the Net Operating Income for such Unencumbered Asset during such fiscal quarter. (e) Compliance Certificate. Within 60 days after the end of each of the first three fiscal quarters of the Borrower (120 days after the end of the last fiscal quarter of the Borrower), a Compliance Certificate, certified by the Chief Financial Officer, setting forth in reasonable detail the computations demonstrating the Borrower's compliance with the provisions of Sections 8.12, 8.13, 8.14, 8.15, 8.16 and 8.17. (f) Other Information. Such other information as the Administrative Agent or any Lender may reasonably request from time to time. 7.2 Certificates; Other Information. Furnish to the Administrative Agent and each Lender: 51 52 (a) Defaults Under Other Indebtedness. Prompt written notice if: (i) any Indebtedness of the Borrower or any Subsidiary of the Borrower is declared or shall become due and payable prior to its stated maturity, or called and not paid when due, or (ii) a default that extends beyond any applicable notice or grace period shall have occurred under any note (other than the Notes) or the holder of any such note, or other evidence of Indebtedness, certificate or security evidencing any such Indebtedness or any obligee with respect to any other Indebtedness of the Borrower or any Subsidiary of the Borrower has the right to declare any such Indebtedness due and payable prior to its stated maturity, and, in the case of either (i) or (ii), the Indebtedness that is the subject of (i) or (ii) is, in the aggregate, $7,500,000 or more; (b) Action of Governmental Authorities. Prompt written notice of: (i) any citation, summons, subpoena, order to show cause or other document naming the Borrower or any Subsidiary of the Borrower a party to any proceeding before any Governmental Authority which could reasonably be expected to have a Material Adverse Effect or which calls into question the validity or enforceability of any of the Loan Documents, and include with such notice a copy of such citation, summons, subpoena, order to show cause or other document; (ii) any lapse or other termination of any Intellectual Property, license, permit, franchise or other authorization issued to the Borrower or any Subsidiary of the Borrower by any Person or Governmental Authority, which lapse or termination could reasonably be expected to have a Material Adverse Effect; and (iii) any refusal by any Person or Governmental Authority to renew or extend any such material Intellectual Property, license, permit, franchise or other authorization, which refusal could reasonably be expected to have a Material Adverse Effect; (c) SEC or other Governmental Reports and Filings. Promptly upon becoming available, copies of all regular, periodic or special reports which the Borrower or any Subsidiary of the Borrower may now or hereafter be required to file with or deliver to any securities exchange or the Securities and Exchange Commission, or any other Governmental Authority succeeding to the functions thereof, pursuant to the Securities Exchange Act of 1934, as amended. (d) ERISA Information. Promptly, and in any event within ten Business Days, after the Borrower knows or has reason to know that any of the events or conditions enumerated below with respect to any Plan or Multiemployer Plan has occurred or exists, a statement signed by the Chief Financial Officer setting forth details with respect to such event or condition and the action, if any, which the Borrower or an ERISA Affiliate proposes to take with respect thereto; provided, however, that if such event or condition is required to be reported or noticed to the PBGC, such statement, together with a copy of the relevant report or notice to the PBGC, shall be furnished promptly and in any event not later than ten days after it is reported or noticed to the PBGC: (i) any reportable event, as defined in Section 4043(b) of ERISA with respect to a Plan, as to which the PBGC has not by regulation waived the requirement of Section 4043(a) of ERISA that it be notified within thirty days of the occurrence of such event (provided that a failure to meet the minimum funding standard of Section 412 of the Code or of Section 302 of ERISA, including, without limitation, the failure to make, 52 53 on or before its due date, a required installment under Section 412(m) of the Code or Section 302(e) of ERISA or the disqualification of such Plan for purposes of Section 4043(b)(1) of ERISA, shall be a reportable event regardless of the issuance of any waivers in accordance with Section 412(d) of the Code) and any request for a waiver under Section 412(d) of the Code for any Plan; (ii) the distribution under Section 4041 of ERISA of a notice of intent to terminate any Plan or any action taken by the Borrower or any ERISA Affiliate to terminate any Plan; (iii) the institution by the PBGC of proceedings under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan, or the receipt by the Borrower or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan; (iv) the complete or partial withdrawal from a Multiemployer Plan by the Borrower or any ERISA Affiliate that results in liability under Section 4201 or 4204 of ERISA (including the obligation to satisfy secondary liability as a result of a purchaser default) or the receipt of the Borrower or any ERISA Affiliate of notice from a Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA or that it intends to terminate or has terminated under Section 4041A of ERISA; (v) the institution of a proceeding by a fiduciary of any Multiemployer Plan against the Borrower or any ERISA Affiliate to enforce Section 515 of ERISA, which proceeding is not dismissed within thirty days from its commencement; (vi) the adoption of an amendment to any Plan pursuant to Section 401(a)(29) of the Code or Section 307 of ERISA that would result in the loss of the tax-exempt status of the trust of which such Plan is a part or the Borrower or any ERISA Affiliate fails to timely provide security to such Plan in accordance with the provisions of said Sections; and (vii) any event or circumstance exists which may reasonably be expected to constitute grounds for the incurrence of material liability by the Borrower or any ERISA Affiliate under Title IV of ERISA or under Sections 412(c)(11) or 412(n) of the Code with respect to any employee benefit plan; (e) ERISA Reports. Promptly after the request of the Administrative Agent or any Lender therefor, copies of each annual report filed pursuant to Section 104 of ERISA with respect to each Plan (including, to the extent required by Section 104 of ERISA, the related financial and actuarial statements and opinions and other supporting statements, certifications, schedules and information referred to in Section 103 of ERISA) and each annual report filed with respect to each Plan under Section 4065 of ERISA; provided, however, that in the case of a 53 54 Multiemployer Plan, such annual reports shall be furnished only if they are available to the Borrower or any ERISA Affiliate; (f) Notice of Proposed Sales or Transfers. Quarterly, on each date that a Compliance Certificate is to be delivered pursuant to Section 7.1(e), a list of all sales or transfers of any Unencumbered Assets (including any agreements for the sale or transfer of any Unencumbered Asset entered into during such fiscal quarter but not yet consummated); provided that, if during any such fiscal quarter of the Borrower any sale or transfer of an Unencumbered Asset, which combined with all other such sales or transfers of Unencumbered Assets during such fiscal quarter, would exceed $100,000,000 in the aggregate, then the Borrower shall promptly provide such list and a certification of the Chief Financial Officer as to the Borrower's compliance with Sections 8.12 and 8.16; (g) Casualties or Condemnations. Prompt written notice of any casualty or condemnation of any Real Property, if such casualty or condemnation could reasonably be expected to have a Material Adverse Effect; (h) Environmental Law Notices. Prompt written notice of any order, notice, claim or proceeding received by, or brought against, the Borrower or any Subsidiary of the Borrower, or with respect to any of the Real Property, under any Environmental Law, which could reasonably be expected to have a Material Adverse Effect; (i) Management Letters and Reports. Promptly after the same are received by the Borrower, copies of all management letters and similar reports provided to the Borrower by the Accountants; (j) New Subsidiaries. Notice of any Subsidiary that, as of the end of any fiscal quarter of the Borrower, satisfies the criteria in Section 7.11 with respect to Required Additional Guarantors, such notice to be delivered to the Administrative Agent concurrently with the delivery of the Compliance Certificate with respect to such quarter; (k) Changes in Name or Fiscal Year. Prompt written notice of (i) any change in the Borrower's name, with copies of all filings with respect to such name change attached thereto, and (ii) any change in its fiscal year from that in effect on the Effective Date. (l) Defaults or Events of Default. Prompt written notice if there shall occur and be continuing a Default or an Event of Default; and (m) Other Information. Such other information as the Administrative Agent or any Lender shall reasonably request from time to time. 7.3 Legal Existence. (a) Borrower's Legal Existence. Maintain its status as a Maryland corporation in good standing in the State of Maryland and in each other jurisdiction in which the failure so to 54 55 do could reasonably be expected to have a Material Adverse Effect. (b) Legal Existence of Subsidiaries. Cause each Subsidiary of the Borrower to maintain its status as a real estate investment trust, business trust, corporation, limited liability company or partnership, as the case may be, in good standing in its state of formation and in each other jurisdiction in which the failure so to do either (i) would result in the occurrence of a Default, or (ii) could reasonably be expected to have a Material Adverse Effect. 7.4 Taxes. Pay and discharge when due, and cause each Subsidiary of the Borrower so to do, all Taxes, assessments and governmental charges, license fees and levies upon, or with respect to, the Borrower or such Subsidiary and all Taxes upon the income, profits and Property of the Borrower and its Subsidiaries, which if unpaid, could reasonably be expected to have a Material Adverse Effect, unless and to the extent only that such Taxes, assessments, governmental charges, license fees and levies shall be contested in good faith and by appropriate proceedings diligently conducted by the Borrower or such Subsidiary and such contest has the effect of staying the collection of any Lien from any Property of the Borrower or its Subsidiaries arising from such non-payment, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. 7.5 Insurance. Maintain, and cause each Subsidiary of the Borrower to maintain, insurance on its Property against such risks and in such amounts as is customarily maintained by Persons engaged in similar businesses and owning similar Properties in the same general areas in which the Borrower or the relevant Subsidiary operates, and file with the Administrative Agent within 10 Business Days after request therefor a detailed list of such insurance then in effect, stating the names of the carriers thereof, the policy numbers, the insureds thereunder, the amounts of insurance, dates of expiration thereof, and the Property and risks covered thereby, together with a certificate of the Chief Financial Officer certifying that in the opinion of such officer such insurance complies with the obligations of the Borrower under this Section, and is in full force and effect. 7.6 Payment of Indebtedness and Performance of Obligations. Pay and discharge when due, and cause each Subsidiary of the Borrower to pay and discharge, all lawful Indebtedness, obligations and claims for labor, materials and supplies or otherwise which, if unpaid, (i) would result in a Default, or (ii) could reasonably be expected to have a Material Adverse Effect, unless (with respect to clause (ii)) such Indebtedness shall be contested in good faith and by appropriate proceedings diligently conducted by the Borrower or such Subsidiary and such contest has the effect of staying the collection of any Lien from any 55 56 Property of the Borrower or its Subsidiaries arising from such non-payment, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. 7.7 Maintenance of Property; Environmental Investigations. (a) In all material respects, at all times, maintain, protect and keep in good repair, working order and condition (ordinary wear and tear excepted), and cause each Subsidiary of the Borrower so to do, all Property necessary to the operation of the Borrower's or such Subsidiary's business. (b) In the event that the Administrative Agent shall have a reasonable basis for believing that Hazardous Substances may be on, at, under or around any Real Property in violation of any applicable Environmental Law which, individually or in the aggregate could reasonably be expected to have a Material Adverse Effect, promptly conduct and complete (at the Borrower's expense) all investigations, studies, samplings and testings relative to such Hazardous Substances as the Administrative Agent may reasonably request. 7.8 Observance of Legal Requirements. (a) Observe and comply in all respects, and cause each Subsidiary of the Borrower so to do, with all laws, ordinances, orders, judgments, rules, regulations, certifications, franchises, permits, licenses, directions and requirements of all Governmental Authorities, which now or at any time hereafter may be applicable to it, except (i) where noncompliance with any of the foregoing (individually or in the aggregate) could not reasonably be expected to have a Material Adverse Effect, or (ii) such thereof as shall be contested in good faith and by appropriate proceedings diligently conducted by it and such contest has the effect of staying the collection of any Lien from any Property of the Borrower or its Subsidiaries arising from such noncompliance, and provided that the Borrower shall give the Administrative Agent prompt notice of such contest and that such reserve or other appropriate provision as shall be required in accordance with GAAP (as determined by the Accountants) shall have been made therefor. (b) Use and operate all of its facilities and property in compliance with all Environmental Laws and cause each of its Subsidiaries so to do, and keep all necessary permits, approvals, certificates, licenses and other authorizations relating to environmental matters in effect and remain in compliance therewith and cause each of its Subsidiaries so to do, and handle all Hazardous Materials in compliance with all applicable Environmental Laws and cause each of its Subsidiaries so to do, except where noncompliance with any of the foregoing (individually or in the aggregate) could not reasonably be expected to have a Material Adverse Effect. 7.9 Inspection of Property; Books and Records; Discussions. Keep proper books of record and account in which full, true and correct entries in conformity with GAAP and all requirements of law shall be made of all dealings and transactions 56 57 in relation to its business and activities and permit representatives of the Administrative Agent and any Lender during normal business hours and on reasonable prior notice to visit its offices, to inspect any of its Property and to examine and make copies or abstracts from any of its books and records as often as may reasonably be desired, and to discuss the business, operations, prospects, licenses, Property and financial condition of the Borrower or and its Subsidiaries with the officers thereof and the Accountants. 7.10 Licenses, Intellectual Property. Maintain, and cause each Subsidiary of the Borrower to maintain, in full force and effect, all material licenses, franchises, Intellectual Property, permits, authorizations and other rights as are necessary for the conduct of its business. 7.11 Required Additional Guarantors. At any time after the date hereof, and with respect to any Subsidiary of the Borrower, whether presently existing or hereafter formed or acquired (other than Excel Realty Partners, L.P. and E. H. Properties, L.P.) which is not a Subsidiary Guarantor at such time, cause such Subsidiary to execute and deliver a Guaranty to the Administrative Agent, for the benefit of the Lenders, promptly after the Administrative Agent's request therefor, duly executed by such Subsidiary (together with the certificates and attachments described in Section 5.1(b) and (c) with respect to such Subsidiary and an opinion of counsel in the form required pursuant to Section 5.7(iii)) if at such time such Subsidiary owns Property having a book value of $75,000,000 or more. Notwithstanding the foregoing, the foregoing book value conditions of this Section shall not be applicable from and after the occurrence of, and during the continuance of, an Event of Default (it being understood that at such time, the Administrative Agent can require any Subsidiary of the Borrower which has not executed a Guaranty to immediately comply with requirements of this Section). 7.12 REIT Status; Operation of Business. (a) Maintain its status under Sections 856 et seq. of the Code as a REIT. (b) Carry on all business operations of the Borrower as a self-advised, self-managed REIT. (c) Manage, or cause one or more of its Subsidiaries at all times to manage, at least 90% of all Properties of the Borrower and its Subsidiaries. 7.13 [Intentionally Omitted]. 8. NEGATIVE COVENANTS. The Borrower agrees that, so long as any Loan remains outstanding and unpaid, any other amount is owing under any Loan Document to any Lender or the Administrative Agent, or any 57 58 Lender shall have any obligation to make or maintain any Loan, the Borrower shall not, directly or indirectly: 8.1 Liens. Create, incur, assume or suffer to exist any Lien upon any of its Property, whether now owned or hereafter acquired, or permit any Subsidiary of the Borrower so to do, except (i) Liens for Taxes, assessments or similar charges incurred in the ordinary course of business which are not delinquent or the existence of which do not otherwise violate the representations in Section 7.4, (ii) Liens in connection with workers' compensation, unemployment insurance or other social security obligations (but not ERISA), (iii) deposits or pledges to secure bids, tenders, contracts (other than contracts for the payment of money), leases, statutory obligations, surety and appeal bonds and other obligations of like nature arising in the ordinary course of business, (iv) zoning ordinances, easements, rights of way, use restrictions, exclusive use limitations in any lease of Real Property, reciprocal easement agreements, minor defects, irregularities, and other similar restrictions and encumbrances affecting Real Property, which do not materially adversely affect the value of such Real Property or the financial condition of the Borrower or such Subsidiary of the Borrower or materially impair its use for the operation of the business of the Borrower or such Subsidiary, (v) statutory Liens arising by operation of law such as mechanics', materialmen's, carriers', warehousemen's liens incurred in the ordinary course of business which are not delinquent or the existence of which do not otherwise violate the representations in Section 7.6, (vi) Liens arising out of judgments or decrees which are being contested in accordance with Section 7.8 or the existence of which do not otherwise violate the representations in Section 7.8 or result in a default pursuant to Section 9.1(j), (vii) mortgages on Real Property, provided that the existence of such mortgages, and the indebtedness secured thereby, does not cause the Borrower to be in violation of Section 8.12 or 8.16, (viii) Liens in favor of the Borrower or any Subsidiary Guarantor, provided that the Indebtedness secured by any such Lien is held by the Borrower or such Subsidiary Guarantor, (ix) the interests of lessees and lessors under leases of real or personal property made in the ordinary course of business which could not reasonably be expected (individually or in the aggregate) to have a Material Adverse Effect and (x) Liens not otherwise permitted by clauses (i) through (ix) of this Section which do not in the aggregate exceed $5,000,000. 8.2 Merger, Consolidation and Certain Dispositions of Property. (a) Consolidate with, be acquired by, or merge into or with any Person, or sell, lease or otherwise dispose of all or substantially all of its Property (in one transaction or a series of transactions), or permit any Subsidiary Guarantor of the Borrower so to do, or liquidate or dissolve, except (i) the merger or consolidation of any Subsidiary Guarantor of the Borrower into or with the Borrower, (ii) the merger or consolidation of any two or more Subsidiary Guarantors, or (iii) the merger or consolidation of the Borrower or Subsidiary Guarantor with any other Person, provided that (A) the Borrower or such Subsidiary Guarantor is the surviving entity in such merger or consolidation, (B) the total book value of the assets of the entity which is merged into or consolidated with the Borrower or such Subsidiary Guarantor is less than 20% of the total book value of the assets of the Borrower immediately following such merger or 58 59 consolidation, (C) immediately prior to such merger or consolidation the Borrower shall have provided to the Administrative Agent and each of the Lenders a Compliance Certificate prepared on a pro-forma basis (and adjusted in the best good faith estimate of the Borrower, based on the advice of the Accountants, to give effect to such merger or consolidation) demonstrating that after giving effect to such merger or consolidation, no Default shall exist with respect to any of the covenants set forth in Sections 8.12, 8.13, 8.14, 8.15, 8.16 and 8.17 and (D) after giving effect to such merger or consolidation, no Event of Default shall exist. (b) Sell, transfer, master lease or dispose of any of its Property, either directly or indirectly, except that if at the time thereof and immediately after giving effect thereto, no Default shall have occurred, (i) any Subsidiary of the Borrower may sell, transfer, master lease or otherwise dispose of its assets to the Borrower or to any other Subsidiary, and (ii) the Borrower or any Subsidiary of the Borrower may sell Property in an arm's length transaction (or, if the transaction involves an Affiliate of the Borrower or a Subsidiary of the Borrower, if the transaction complies with Section 8.8) for the fair market value thereof, as reasonably determined by the Borrower, provided that such sale could not reasonably be expected to have a Material Adverse Effect and provided further that for any fiscal year of the Borrower, any sale, transfer, master lease or disposition of Property in reliance on this clause (ii) which when combined with all other such sales, transfers, master leases or dispositions made in such fiscal year shall not exceed 25% of the total book value of all Property of the Borrower and its Subsidiaries determined as of the first day of such fiscal year. 8.3 Investments, Loans, Etc. At any time, purchase or otherwise acquire, hold or invest in the Stock of, or any other interest in, any Person, or make any loan or advance to, or enter into any arrangement for the purpose of providing funds or credit to, or make any other investment, whether by way of capital contribution, time deposit or otherwise, in or with any Person, or permit any Subsidiary of the Borrower so to do, (all of which are sometimes referred to herein as "Investments") except the following (to the extent that maintaining any thereof would not at any time violate the requirements of Section 856(c) of the Code): (a) demand deposits, certificates of deposit, bankers acceptances and domestic and eurodollar time deposits with any Lender, or any other commercial bank, trust company or national banking association incorporated under the laws of the United States or any State thereof and having undivided capital, surplus and undivided profits exceeding $500,000,000 and a long term debt rating of A or A2, as determined, respectively, by S&P and Moody's; (b) short-term direct obligations of the United States of America or agencies thereof whose obligations are guaranteed by the United States of America; (c) securities commonly known as "commercial paper" issued by a corporation organized and existing under the laws of the United States or any State thereof which at the time of purchase are rated by S&P or Moody's at not less than "A1" or "P1," respectively; 59 60 (d) mortgage-backed securities guaranteed by the Governmental National Mortgage Association, the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation and other mortgage-backed bonds which at the time of purchase are rated by S&P or Moody's at not less than "Aa" or "AA," respectively; (e) repurchase agreements having a term not greater than 90 days and fully secured by securities described in the foregoing paragraph (b) or (d) with banks described in the foregoing paragraph (a) or with financial institutions or other corporations having total assets in excess of $50,000,000; (f) shares of "money market funds" registered with the SEC under the Investment Company Act of 1940 which maintain a level per-share value, invest principally in the investments described in one or more of the foregoing paragraphs (a) through (e) and have total assets of in excess of $50,000,000; (g) Real Property and loans secured by mortgages on Real Property; (h) equity investments in any Person (other than Subsidiaries) and notes receivable investments in any Person (other than Subsidiaries), the aggregate principal amount of which (combined with any other equity investments and notes receivable investments in any Person permitted pursuant to this paragraph (h)) do not exceed 25% of the Total Capital of the Borrower; (i) Investments (debt or equity) in Subsidiaries of the Borrower; (j) investments in respect of (1) equipment, inventory and other tangible personal property acquired in the ordinary course of business, (2) current trade and customer accounts receivable for services rendered in the ordinary course of business, (3) advances to employees for travel expenses other company-related expenses, and (4) prepaid expenses made in the ordinary course of business; (k) Hedging Agreements made in connection with any Indebtedness; (l) repurchases of any common or preferred stock or other equity interests (or securities convertible into such interests) in the Borrower or any Subsidiary that have been previously issued by the Borrower or such Subsidiary, which do not exceed, in any calendar year, (1) 10% of the outstanding shares of common or preferred stock or other equity interests in Borrower or such Subsidiary, as applicable, as of the date hereof, plus (2) 10% of any additional shares of common or preferred stock or other equity interests in Borrower or such Subsidiary, as applicable, issued after the date hereof; (m) redemptions of preferred stock of the Borrower in accordance with the terms thereof; (n) redemptions for cash or common Stock of the Borrower of units of limited 60 61 partner interests or limited liability company interests in a DownREIT Partnership; (o) loans to employees of the Borrower, provided that all such loans in the aggregate do not at any time exceed $15,000,000 in the aggregate; and (p) any other Investments not included in paragraphs (a) through (o) deemed appropriate by the Borrower, provided that in no event shall Investments made in reliance upon the exception set forth in this paragraph (p) exceed $50,000,000 at any one time; 8.4 Business Changes. Change in any material respect the nature of the business of the Borrower or its Subsidiaries as conducted on the Effective Date. 8.5 Amendments to Organizational Documents. Amend or otherwise modify its corporate charter or by-laws in any way (other than in connection with the issuance or classification of preferred stock of the Borrower) which would adversely affect the interests of the Administrative Agent and the Lenders under any of the Loan Documents, or permit any Subsidiary of the Borrower to amend its organizational documents in a manner which could have the same result. 8.6 Bankruptcy Proceedings. Institute against the Administrative Agent or any Lender, or join any other Person in instituting against the Administrative Agent or any Lender, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding or other proceeding under any federal or state bankruptcy or similar law, for one year and a day after the payment or prepayment in full of the Indebtedness due hereunder. 8.7 Sale and Leaseback. Enter into any arrangement with any Person providing for the leasing by it of Property which has been or is to be sold or transferred by it to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such Property or its rental obligations, or permit any Subsidiary of the Borrower so to do, except for sale and leasing transactions described herein for which the combined selling price of all Property subject to all such transactions does not exceed $50,000,000 in the aggregate. 8.8 Transactions with Affiliates. Become a party to any transaction in an amount that exceeds $60,000 with an Affiliate unless the terms and conditions relating thereto (i) have been approved by a majority of the disinterested directors of the Borrower, (ii) have been approved by a majority of votes cast by the stockholders of the Borrower, or (iii) are fair and reasonable to the Borrower, or permit any 61 62 Subsidiary of the Borrower so to do. 8.9 Issuance of Additional Capital Stock by Subsidiary Guarantors. Permit any Subsidiary Guarantor to issue any additional Stock or other equity interest of such Subsidiary Guarantor, other than the issuance of partnership or limited liability company units in a DownREIT Partnership which is a Subsidiary Guarantor, provided that such units are issued in consideration of the contribution to the DownREIT Partnership of assets qualifying as "real estate assets" under Section 856(c) of the Code. 8.10 Hedging Agreements. Enter into, or permit any of its Subsidiaries so to do, any Hedging Agreement, other than Hedging Agreements entered into in the ordinary course of business to hedge or mitigate interest rate risks to which the Borrower or any Subsidiary of the Borrower is exposed in the conduct of its business or the management of its liabilities. 8.11 Restricted Payments. (a) Permit the Borrower to make Restricted Payments, except that: (i) except as set forth in clause (ii) below, the Borrower may declare and pay dividends payable with respect to its equity securities in any fiscal quarter of the Borrower if after giving effect to such dividend, such dividend, when added to the amount of all other such dividends paid in the same fiscal quarter and the preceding three (3) fiscal quarters, would not exceed the greater of (A) ninety percent (90%) of its Funds from Operations for the four consecutive fiscal quarters ending prior to the quarter in which such dividend is paid or (B) the minimum amount of such dividends required under the Code to enable the Borrower to continue to maintain its status under the Code as a REIT, as evidenced (in the case of clause (B)) by a certification of Chief Financial Officer containing calculations in reasonable detail satisfactory in form and substance to Administrative Agent; (ii) if an Event of Default under Section 9.1(a) or (b) has occurred and is continuing, the Borrower may declare and pay dividends with respect to its equity securities which shall not exceed the minimum such dividends required under the Code to enable the Borrower to continue to maintain its status under the Code as a REIT, as evidenced by a certification of Chief Financial Officer containing calculations in reasonable detail satisfactory in form and substance to Administrative Agent; (iii) the Borrower may effect Stock repurchases to the extent permitted by Section .3(l); (iv) the Borrower may effect "cashless exercises" of options granted under the Borrower's stock option plans; 62 63 (v) the Borrower may distribute rights or equity securities under any rights plan adopted by the Borrower; and (vi) the Borrower may declare and pay dividends (or effect Stock splits or reverse Stock splits) with respect to its equity securities payable solely in additional shares of its equity securities. 8.12 Unencumbered Assets Coverage Ratio. Permit the Unencumbered Assets Coverage Ratio to be less than 2.0:1.0 at any time. 8.13 Fixed Charge Coverage Ratio. Permit the Fixed Charge Coverage Ratio to be less than 1.75:1.0 at any time. 8.14 Minimum Tangible Net Worth. Permit the Tangible Net Worth of the Borrower and its Subsidiaries on a Consolidated basis at any time to be less than the sum of (i) $1,200,000,000, plus (ii) 80% of the aggregate net proceeds received by the Borrower from and after the Effective Date in connection with the issuance of any capital stock of the Borrower. 8.15 Maximum Total Indebtedness. Permit at any time either (i) all Consolidated Total Indebtedness at such time to be more than 55% of Total Capital at such time, or (ii) the Consolidated Total Indebtedness secured by mortgages on Real Property owned by the Borrower and its Subsidiaries at such time to exceed 40% of Total Capital at such time. 8.16 Liabilities to Assets Ratio. Permit, at any time, the portion of the Consolidated Total Indebtedness consisting of Consolidated unsecured Indebtedness of the Borrower and its Subsidiaries at such time to be more than 50% of Unencumbered Asset Value at such time. 8.17 Maximum Book Value of Ancillary Assets. Permit the book value of the Ancillary Assets at any time to be more than 20% of the book value of all assets of the Borrower and its Subsidiaries on a Consolidated basis at such time. For purposes of this Section 8.17 the book value of any Ancillary Asset not owned 100%, directly or indirectly, by the Borrower or any of its Subsidiaries shall be adjusted by multiplying the same by the Borrower's Interest in such Ancillary Asset during the fiscal quarter of the Borrower ending as of any date of determination of such book value. 63 64 9. DEFAULT. 9.1 Events of Default. The following shall each constitute an "Event of Default" hereunder: (a) The failure of the Borrower to pay any installment of principal on any Note on the date when due and payable; or (b) The failure of the Borrower to pay any installment of interest or any other fees, expenses or other charges payable under any Loan Document within five Business Days of the date when due and payable; or (c) The use of the proceeds of any Loan in a manner inconsistent with or in violation of Section 2.15; or (d) The failure of the Borrower to observe or perform any covenant or agreement contained in Section 7.3, 7.12(a), 7.12(b), or 8 (other than Section 8.1, as to which the provisions of paragraph (e) below shall apply); or (e) The failure to observe or perform any other term, covenant, or agreement contained in any Loan Document and such failure shall have continued unremedied for a period of 30 days after notice thereof from the Administrative Agent to the Borrower; or (f) Any representation or warranty of the Borrower (or of any officer of the Borrower on its behalf) made in any Loan Document to which it is a party or in any certificate, report, opinion (other than an opinion of counsel) or other document delivered or to be delivered pursuant thereto, shall prove to have been incorrect or misleading (whether because of misstatement or omission) in any material respect when made; or (g) Any obligation of the Borrower (other than its obligations under the Notes) or any Subsidiary of the Borrower, whether as principal, guarantor, surety or other obligor, for the payment of any Indebtedness shall (i) become or shall be declared to be due and payable prior to the expressed maturity thereof, or (ii) shall not be paid when due or within any grace period for the payment thereof, or (iii) shall be subject, by the holder of the obligation evidencing such Indebtedness, to acceleration (after the expiration of any applicable notice and cure periods) prior to the expressed maturity thereof, and the sum of all such Indebtedness which is the subject of paragraphs (i) - (iii) inclusive exceeds (A) at any time, in the case of Indebtedness other than Non-Recourse Indebtedness, $7,500,000, and (B) in any calendar year, in the case of Non-Recourse Indebtedness, $50,000,000 in the aggregate during such year; or (h) The Borrower or any Subsidiary Guarantor of the Borrower shall (i) suspend or discontinue its business, (ii) make an assignment for the benefit of creditors, (iii) generally not be paying its debts as such debts become due, (iv) admit in writing its inability to 64 65 pay its debts as they become due, (v) file a voluntary petition in bankruptcy, (vi) become insolvent (however such insolvency shall be evidenced), (vii) file any petition or answer seeking for itself any reorganization, arrangement, composition, readjustment of debt, liquidation or dissolution or similar relief under any present or future statute, law or regulation of any jurisdiction, (viii) petition or apply to any tribunal for any receiver, custodian or any trustee for any substantial part of its Property, (ix) be the subject of any such proceeding filed against it which remains undismissed for a period of 60 days, (x) file any answer admitting or not contesting the material allegations of any such petition filed against it or any order, judgment or decree approving such petition in any such proceeding, (xi) seek, approve, consent to, or acquiesce in any such proceeding, or in the appointment of any trustee, receiver, custodian, liquidator, or fiscal agent for it, or any substantial part of its Property, or an order is entered appointing any such trustee, receiver, custodian, liquidator or fiscal agent and such order remains in effect for 60 days, or (xii) take any formal action for the purpose of effecting any of the foregoing; or (i) An order for relief is entered under the United States bankruptcy laws or any other decree or order is entered by a court having jurisdiction (i) adjudging the Borrower or any Subsidiary Guarantor bankrupt or insolvent, (ii) approving as properly filed a petition seeking reorganization, liquidation, arrangement, adjustment or composition of or in respect of the Borrower or any Subsidiary Guarantor under the United States bankruptcy laws or any other applicable Federal or state law, (iii) appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) of the Borrower or any Subsidiary Guarantor or of any substantial part of the Property thereof, or (iv) ordering the winding up or liquidation of the affairs of the Borrower or any Subsidiary Guarantor, and any such decree or order continues unstayed and in effect for a period of 60 days; or (j) Judgments or decrees against the Borrower or any Subsidiary of the Borrower aggregating in excess of $5,000,000 shall not be paid, stayed on appeal, discharged, bonded or dismissed for a period of 45 days; or (k) Any Loan Document shall cease, for any reason, to be in full force and effect, or the Borrower shall so assert in writing or shall disavow any of its obligations thereunder; or (l) An event or condition specified in Section 7.2(d) shall occur or exist with respect to any Plan or Multiemployer Plan and, as a result of such event or condition, together with all other such events or conditions, the Borrower shall be reasonably likely to incur a liability to a Plan, a Multiemployer Plan, the PBGC, or any combination thereof which would constitute, in the reasonable opinion of the Required Lenders, a Material Adverse Effect; or (m) There shall occur a Change of Control; or (n) If any Loan Document (i) is determined by any court or Governmental Authority to be illegal, invalid or unenforceable in accordance with its terms, or (ii) shall be canceled, terminated, revoked or rescinded other than in accordance with its terms or with the 65 66 written consent or approval of the Lenders; or (o) (i) Any Subsidiary Guarantor shall fail to comply in any material respect with any covenant made by it in the Guaranty or if at any time any representation or warranty made by any Subsidiary Guarantor in the Guaranty or in any other document, statement or writing made to the Administrative Agent, the Lead Arranger or the Lenders shall prove to have been incorrect or misleading in any material respect when made, or (ii) if a default by any Subsidiary Guarantor shall occur under the Guaranty after the expiration of any applicable notice and grace period; or (iii) if any Subsidiary Guarantor shall revoke or attempt to revoke, contest, commence any action or raise any defense (other than the defense of payment) against its obligations under the Guaranty; or (p) There shall occur and be continuing an Event of Default under and as defined in the Existing Credit Agreements. Upon the occurrence of an Event of Default or at any time thereafter during the continuance thereof, (a) if such event is an Event of Default specified in clause (h) or (i) above, the Commitments shall immediately and automatically terminate and the Loans, all accrued and unpaid interest thereon, and all other amounts owing under the Loan Documents shall immediately become due and payable, and the Administrative Agent may, and upon the direction of the Required Lenders shall, exercise any and all remedies and other rights provided in the Loan Documents, and (b) if such event is any other Event of Default, any or all of the following actions may be taken: (i) with the consent of the Required Lenders, the Administrative Agent may, and upon the direction of the Required Lenders shall, by notice to the Borrower, declare the Commitments to be terminated forthwith, whereupon the Commitments shall immediately terminate; and (ii) with the consent of the Required Lenders, the Administrative Agent may, and upon the direction of the Required Lenders shall, by notice of default to the Borrower, declare the Loans, all accrued and unpaid interest thereon and all other amounts owing under the Loan Documents to be due and payable forthwith, whereupon the same shall immediately become due and payable, and the Administrative Agent may, and upon the direction of the Required Lenders shall, exercise any and all remedies and other rights provided pursuant to the Loan Documents. Except as otherwise provided in this Section, presentment, demand, protest and all other notices of any kind are hereby expressly waived. The Borrower hereby further expressly waives and covenants not to assert any appraisement, valuation, stay, extension, redemption or similar laws, now or at any time hereafter in force which might delay, prevent or otherwise impede the performance or enforcement of any Loan Document. In the event that the Commitments shall have been terminated or the Notes shall have been declared due and payable pursuant to the provisions of this Section, any funds received by the Administrative Agent and the Lenders from or on behalf of the Borrower shall be applied by the Administrative Agent and the Lenders in liquidation of the Loans and the obligations of the Borrower under the Loan Documents in the following manner and order: (i) first, to the payment of interest on and then the principal portion of any Loans which the Administrative Agent may have advanced on behalf of any Lender for which the Administrative Agent has not then been reimbursed by such Lender or the Borrower; (ii) second, to the payment 66 67 of any fees or expenses due the Administrative Agent from the Borrower; (iii) third, to reimburse the Administrative Agent and the Lenders for any expenses (to the extent not paid pursuant to clause (ii)) due from the Borrower pursuant to the provisions of Section 11.5; (iv) fourth, to the payment of accrued Facility Fees, and all other fees, expenses and amounts due under the Loan Documents (other than principal and interest on the Notes); (v) fifth, to the payment of interest due on the Notes; (vi) sixth, to the payment of principal outstanding on the Notes; and (vii) seventh, to the payment of any other amounts owing to the Administrative Agent, the Lead Arranger and the Lenders under any Loan Document or other document or agreement entered into in connection with the transactions contemplated thereby. 10. THE AGENT. 10.1 Appointment. Each Lender hereby irrevocably designates and appoints FNB as the Administrative Agent of such Lender under the Loan Documents and each such Lender hereby irrevocably authorizes FNB, as the Administrative Agent for such Lender, to take such action on its behalf under the provisions of the Loan Documents and to exercise such powers and perform such duties as are expressly delegated to the Administrative Agent by the terms of the Loan Documents, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in any Loan Document, the Administrative Agent shall not have any duties or responsibilities, except those expressly set forth therein, or any fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into the Loan Documents or otherwise exist against the Administrative Agent. 10.2 Delegation of Duties. The Administrative Agent may execute any of its duties under the Loan Documents by or through agents or attorneys-in-fact and shall be entitled to rely upon the advice of counsel concerning all matters pertaining to such duties. 10.3 Exculpatory Provisions. Neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any action lawfully taken or omitted to be taken by it or such Person under or in connection with the Loan Documents (except for its own gross negligence or willful misconduct), or (ii) responsible in any manner to any of the Lenders for any recitals, statements, representations or warranties made by the Borrower or any officer thereof contained in the Loan Documents or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, the Loan Documents or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of any of the Loan Documents or for any failure of the Borrower or any other Person to perform its obligations thereunder. The Administrative Agent shall not be under any obligation to any Lender to ascertain or to inquire as to the observance or performance 67 68 of any of the agreements contained in, or conditions of, the Loan Documents, or to inspect the properties, books or records of the Borrower. The Administrative Agent shall not be under any liability or responsibility whatsoever, as Administrative Agent, to the Borrower or any other Person as a consequence of any failure or delay in performance, or any breach, by any Lender of any of its obligations under any of the Loan Documents. 10.4 Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, opinion, letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other document or conversation reasonably believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including, without limitation, counsel to the Borrower), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent may treat each Lender, or the Person designated in the last notice filed with it under this Section, as the holder of all of the interests of such Lender in its Loans and in its Note until written notice of transfer, signed by such Lender (or the Person designated in the last notice filed with the Administrative Agent) and by the Person designated in such written notice of transfer, in form and substance satisfactory to the Administrative Agent, shall have been filed with the Administrative Agent. The Administrative Agent shall not be under any duty to examine or pass upon the validity, effectiveness or genuineness of the Loan Documents or any instrument, document or communication furnished pursuant thereto or in connection therewith, and the Administrative Agent shall be entitled to assume that the same are valid, effective and genuine, have been signed or sent by the proper parties and are what they purport to be. The Administrative Agent shall be fully justified in failing or refusing to take any action under the Loan Documents unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under the Loan Documents in accordance with a request or direction of the Required Lenders, and such request or direction and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders and all future holders of the Notes. 10.5 Notice of Default. The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default unless the Administrative Agent has received written notice thereof from a Lender or the Borrower. In the event that the Administrative Agent receives such a notice, the Administrative Agent shall promptly give notice thereof to the Lenders. The Administrative Agent shall take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders, provided, however, that unless and until the Administrative Agent shall have received such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem to be in the best interests of the Lenders. 68 69 10.6 Non-Reliance on Administrative Agent and Other Lenders. Each Lender expressly acknowledges that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereinafter, including any review of the affairs of the Borrower, shall be deemed to constitute any representation or warranty by the Administrative Agent to any Lender. Each Lender represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it has deemed appropriate, made its own evaluation of and investigation into the business, operations, Property, financial and other condition and creditworthiness of the Borrower and made its own decision to enter into this Agreement. Each Lender also represents that it will, independently and without reliance upon the Administrative Agent or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit analysis, evaluations and decisions in taking or not taking action under any Loan Document, and to make such investigation as it deems necessary to inform itself as to the business, operations, Property, financial and other condition and creditworthiness of the Borrower. Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, operations, Property, financial and other condition or creditworthiness of the Borrower which may come into the possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or affiliates. 10.7 Indemnification. Each Lender agrees to indemnify and reimburse the Administrative Agent in its capacity as such (to the extent not promptly reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), pro rata according to its Commitment, from and against any and all liabilities, obligations, claims, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever including, without limitation, any amounts paid to the Lenders (through the Administrative Agent) by the Borrower pursuant to the terms of the Loan Documents, that are subsequently rescinded or avoided, or must otherwise be restored or returned) which may at any time (including, without limitation, at any time following the payment of the Notes) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of the Loan Documents or any other documents contemplated by or referred to therein or the transactions contemplated thereby or any action taken or omitted to be taken by the Administrative Agent under or in connection with any of the foregoing; provided, however, that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements to the extent resulting solely from the gross negligence or willful misconduct of the Administrative Agent. The agreements in this Section shall survive the payment of all amounts payable under the Loan Documents. 10.8 Administrative Agent in Its Individual Capacity. 69 70 FNB and its affiliates may make loans to, accept deposits from, issue letters of credit for the account of, and generally engage in any kind of business with, the Borrower as though FNB was not Administrative Agent hereunder. With respect to the Commitment made or renewed by FNB and the Note issued to FNB, FNB shall have the same rights and powers under the Loan Documents as any Lender and may exercise the same as though it was not the Administrative Agent, and the terms "Lender" and "Lenders" shall in each case include FNB. 10.9 Successor Administrative Agent. If at any time the Administrative Agent deems it advisable, in its sole discretion, it may submit to each of the Lenders a written notice of its resignation as Administrative Agent under this Agreement, such resignation to be effective upon the earlier of (i) the written acceptance of the duties of the Administrative Agent under the Loan Documents by a successor Administrative Agent and (ii) on the 60th day after the date of such notice. Upon any such notice of resignation, the Required Lenders shall have the right to appoint from among the Lenders a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed by the Required Lenders and accepted such appointment in writing within 45 days after the retiring Administrative Agent's giving of notice of resignation, then the retiring Administrative Agent shall, in consultation with the Borrower, appoint a successor Administrative Agent on behalf of the Lenders prior to the end of the 60th day from such notice from among any of the Lenders who shall have at such time a Commitment of at least $15,000,000 (an "Approved Successor"). If no Lender has a Commitment of at least $15,000,000 (or no Lender whose Commitment is at least $15,000,000 shall agree to accept such appointment), then the retiring Administrative Agent shall, in consultation with the Borrower, appoint any other Lender or any other commercial bank organized under the laws of the United States of America or any State thereof and having a combined capital and surplus of at least $100,000,000 as a successor Administrative Agent. Any appointment of a successor Administrative Agent shall be subject to the approval of the Borrower, which approval shall not be unreasonably withheld or delayed, and shall be given in any event prior to the end of the 60th day from the date of the retiring Administrative Agent's notice of resignation, provided that during any period in which there exists and is continuing an Event of Default, no approval from the Borrower to the appointment of an Approved Successor shall be required. Upon the acceptance of an appointment as Administrative Agent hereunder by a successor Administrative Agent and any required approval of such successor Administrative Agent by the Borrower in accordance with the terms of this Section, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent's rights, powers, privileges and duties as Administrative Agent under the Loan Documents shall be terminated. The Borrower and the Lenders shall execute such documents as shall be necessary to effect such appointment. After any retiring Administrative Agent's resignation hereunder as Administrative Agent, the provisions of the Loan Documents shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under the Loan Documents. 10.10 [Intentionally Omitted]. 70 71 11. OTHER PROVISIONS. 11.1 Amendments and Waivers. With the written consent of the Required Lenders, the Administrative Agent and the Borrower may, from time to time, enter into written amendments, supplements or modifications of the Loan Documents and, with the consent of the Required Lenders, the Administrative Agent on behalf of the Lenders may execute and deliver to any such parties a written instrument waiving or a consent to a departure from, on such terms and conditions as the Administrative Agent may specify in such instrument, any of the requirements of the Loan Documents or any Default or Event of Default and its consequences; provided, however, that no such amendment, supplement, modification, waiver or consent shall, without the consent of all of the Lenders: (i) increase the Commitments of any Lender or the Total Commitment Amount (except as provided in Section 2.1(b)); (ii) extend the Maturity Date or the Advance Termination Date; (iii) decrease the rate, or extend the time of payment, of interest of, or change or forgive the principal amount of, or change the requirement that payments and prepayments of principal of, and payments of interest on, the Notes be made pro rata to the Lenders on the basis of the outstanding principal amount of the Loans, (iv) amend the definition of "Required Lender", (v) amend the definition of "Applicable Margin", (vi) release any Subsidiary Guarantor from its obligations under a Guaranty, or (vii) change the provisions of Section 2.9, 2.10, 2.11, 2.12, 2.13, 2.14, 2.15, 2.16, 3.1 or 11.1; and provided further that no such amendment, supplement, modification, waiver or consent shall amend, modify, waive or consent to a departure from any provision of Section 10 or otherwise change any of the rights or obligations of the Administrative Agent under the Loan Documents without the written consent of the Administrative Agent. The Administrative Agent shall cause a copy of each written request for such an amendment, supplement or modification delivered by the Borrower to it to be delivered to each Lender. Any such amendment, supplement, modification, waiver or consent shall apply equally to each of the Lenders and shall be binding upon the parties to the applicable agreement, the Lenders, the Administrative Agent and all future holders of the Notes. In the case of any waiver, the parties to the applicable agreement, the Lenders and the Administrative Agent shall be restored to their former position and rights under the Loan Documents, and any Default or Event of Default waived shall not extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon. 11.2 Notices. All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered by hand, or if sent by certified mail (return receipt requested), when the return receipt is signed on behalf of the party to whom such notice is given, or in the case of telecopier notice, when sent, or if sent by overnight nationwide commercial courier, the Business Day following the date such notice is deposited with said courier, and in any case addressed as follows in the case of the Borrower or the Administrative Agent, and at the Domestic Lending Office in the case of each Lender, or to such other addresses as to which the 71 72 Administrative Agent may be hereafter notified by the respective parties hereto or any future holders of the Notes: The Borrower: New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas New York, New York 10036 Attention: Dean Bernstein, Senior Vice President Telephone: (212) 869-3000 Telecopy: (212) 869-3989 with a copy to: New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas New York, New York 10036 Attention: Steven F. Siegel, Esq., General Counsel Telephone: (212) 869-3000 Telecopy: (212) 302-4776 The Administrative Agent: Fleet National Bank 100 Federal Street Boston, Massachusetts 02110 Attention: Real Estate Division with a copy to: Fleet National Bank 115 Perimeter Center Place, N.E. Suite 500 Atlanta, Georgia 30346 Attention: Daniel P. Stegemoeller, Vice President Telephone: (770) 390-6547 Telecopy: (770) 390-8434 except that any notice, request or demand by the Borrower to or upon the Administrative Agent or the Lenders pursuant to Section 2.3 or 2.8 shall not be effective until received. Any party to a Loan Document may rely on signatures of the parties thereto which are transmitted by telecopier or other electronic means as fully as if originally signed. 72 73 11.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising any right, remedy, power or privilege under any Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under any Loan Document preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges under the Loan Documents are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law. 11.4 Survival of Representations and Warranties. All representations and warranties made under the Loan Documents and in any document, certificate or statement delivered pursuant hereto or in connection therewith shall survive the execution and delivery of the Loan Documents. After the termination of this Agreement in accordance with its terms, without any extension thereof, the payment in full of all obligations of the Borrower under the Loan Documents and the expiration of any obligations of the Borrower hereunder which survive the termination of this Agreement, the Borrower shall have no liability to the Lenders under such representations and warranties, except that the foregoing shall not apply with respect to any claim, action or proceeding made or brought under any such representations or warranties prior to such termination or payment. 11.5 Payment of Expenses and Taxes. The Borrower agrees, promptly upon presentation of a statement or invoice therefor, and whether any Loan is made (i) to pay or reimburse each Credit Party for all of its out-of-pocket costs and expenses reasonably incurred in connection with the development, preparation, negotiation and execution of, the Loan Documents, the syndication of the loan transaction evidenced by this Agreement (whether or not such syndication is completed) and any amendment, supplement or modification hereto (whether or not executed), any documents prepared in connection therewith and the consummation of the transactions contemplated thereby, including, without limitation, the reasonable fees and disbursements of Special Counsel, (ii) to pay or reimburse each Credit Party for all of its respective costs and expenses, including, without limitation, reasonable fees and disbursements of counsel, incurred in connection with (x) any Default or Event of Default and any enforcement or collection proceedings resulting therefrom (including, without limitation, any costs incurred after the entry of judgment in an attempt to collect money due in the judgment) or in connection with the negotiation of any restructuring or "work-out" (whether consummated or not) of the obligations of the Borrower under any of the Loan Documents and (y) the enforcement of this Section, (iii) to pay, indemnify, and hold each Credit Party harmless from and against, any and all recording and filing fees and any and all liabilities with respect to, or resulting from any delay in paying, stamp, excise and other similar taxes, if any, which may be payable or determined to be payable in connection with the execution and delivery of, or consummation of any of the transactions contemplated by, or any amendment, supplement or modification of, or any waiver or consent under or in respect of, the Loan Documents and any such other documents, and (iv) to pay, indemnify and hold each Credit Party and each of their respective officers, directors, employees, 73 74 affiliates, agents, controlling persons and attorneys (as used in this Section, each an "indemnified person") harmless from and against any and all other liabilities, obligations, claims, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever (including, without limitation, reasonable counsel fees and disbursements) with respect to any claim, investigation or proceeding from any third party relating to this Agreement or the Loan Documents, including the enforcement and performance of the Loan Documents and the use of the proceeds of the Loans (all the foregoing, collectively, the "indemnified liabilities"), whether or not any such indemnified person is a party to this Agreement or the Loan Documents, and to reimburse each indemnified person for all legal and other expenses incurred in connection with investigating or defending any indemnified liabilities, and, if and to the extent that the foregoing indemnity may be unenforceable for any reason, the Borrower agrees to make the maximum payment permitted or not prohibited under applicable law; provided, however, that the Borrower shall have no obligation hereunder to pay indemnified liabilities to any Credit Party arising from (A) the gross negligence or willful misconduct of such Credit Party or (B) disputes solely between the Credit Parties and which are not related to any act or failure to act on the part of the Borrower or the failure of the Borrower to perform any of its obligations under this Agreement or the Loan Documents. Notwithstanding the foregoing, the fees and expenses referred to in clause (iv) of the preceding paragraph shall not be payable by the Borrower if (x) any such enforcement action brought by such Credit Party is dismissed, with prejudice, on the pleadings or pursuant to a motion made by the Borrower for summary judgment, and (y) if such Credit Party appeals such dismissal, such dismissal is affirmed and the time for any further appeals has expired. The obligations of the Borrower under this Section shall survive the termination of this Agreement and the Commitments and the payment of the Notes and all other amounts payable under the Loan Documents. 11.6 Lending Offices. Each Lender shall have the right at any time and from time to time to transfer its Loans to a different office, provided that such Lender shall promptly notify the Administrative Agent and the Borrower of any such change of office. Such office shall thereupon become such Lender's Domestic Lending Office or Eurodollar Lending Office, as the case may be; provided, however, that no such Lender shall be entitled to receive any greater amount under Section 2.13, 2.14 or 2.16 as a result of a transfer of any such Loans to a different office of such Lender than it would be entitled to immediately prior thereto unless such claim would have arisen even if such transfer had not occurred. 11.7 Successors and Assigns. (a) The Loan Documents shall be binding upon and inure to the benefit of the Borrower, the Lenders, the Administrative Agent, all future holders of the Notes and their respective successors and assigns, except that the Borrower may not assign, delegate or transfer any of its rights or obligations under the Loan Documents without the prior written consent of the Administrative Agent and all of the Lenders. 74 75 (b) Each Lender shall have the right at any time, upon written notice to the Administrative Agent of its intent to do so, to sell, assign, transfer or negotiate all or any part of such Lender's rights and/or obligations under the Loan Documents to one or more of its Affiliates, to one or more of the other Lenders (or to Affiliates of such other Lenders) or, with the prior written consent of the Borrower, and the Administrative Agent (which consent, from each of them, shall not be unreasonably withheld or delayed and shall not be required from the Borrower upon the occurrence and during the continuance of an Event of Default), to sell, assign, transfer or negotiate all or any part of such Lender's rights and obligations under the Loan Documents to any other bank, insurance company, pension fund, mutual fund or other financial institution, provided that there shall be paid to the Administrative Agent by the assigning Lender a fee (the "Assignment Fee") of $3,500. For each assignment, the parties to such assignment shall execute and deliver to the Administrative Agent for its acceptance and recording an Assignment and Assumption Agreement. Upon such execution, delivery, acceptance and recording by the Administrative Agent, from and after the effective date specified in such Assignment and Assumption Agreement, the assignee thereunder shall be a party hereto and, to the extent provided in such Assignment and Assumption Agreement, the assignor Lender thereunder shall be released from its obligations under the Loan Documents. The Borrower agrees upon written request of the Administrative Agent and at the Borrower's expense to execute and deliver (1) to such assignee, a Note, dated the effective date of such Assignment and Assumption Agreement, in an aggregate principal amount equal to the Loans assigned to, and Commitments assumed by, such assignee and (2) to such assignor Lender, a Note, dated the effective date of such Assignment and Assumption Agreement, in an aggregate principal amount equal to the balance of such assignor Lender's Loans and Commitment, if any, and each assignor Lender shall cancel and return to the Borrower its existing Note. Upon any such sale, assignment or other transfer, the Commitment Amounts set forth in Exhibit B shall be adjusted accordingly by the Administrative Agent and a new Exhibit B shall be distributed by the Administrative Agent to the Borrower and each Lender. (c) Each Lender may grant participations in all or any part of its Loans, its Note and its Commitment to one or more banks, insurance companies, financial institutions, pension funds or mutual funds, provided that (i) such Lender's obligations under the Loan Documents shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties to the Loan Documents for the performance of such obligations, (iii) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender's rights and obligations under the Loan Documents, (iv) no sub-participations shall be permitted and (v) the voting rights of any holder of any participation shall be limited to decisions that only do any of the following: (A) subject the participant to any additional obligation, (B) reduce the principal of, or interest on the Notes or any fees or other amounts payable hereunder, and (C) postpone any date fixed for the payment of principal of, or interest on the Notes or any fees or other amounts payable hereunder. The Borrower acknowledges and agrees that any such participant shall for purposes of Sections 2.10, 2.11, 2.12, 2.13, 2.14, 2.15 and 2.16 be deemed to be a "Lender"; provided, however, the Borrower shall not, at any time, be obligated to pay any participant in any interest of any Lender hereunder any sum in excess of the sum which the Borrower would have been obligated to pay to 75 76 such Lender in respect of such interest had such Lender not sold such participation. (d) If any (i) assignment made pursuant to paragraph (b) above or (ii) any participation granted pursuant to paragraph (d) above shall be made to any Person that is organized under the laws of any jurisdiction other than the United States of America or any State thereof, such Person shall furnish such certificates, documents or other evidence to the Borrower and the Administrative Agent, in the case of clause (i) and to the Borrower and the Lender which sold such participation in the case of clause (ii), as shall be required by Section 2.11(b) to evidence such Person's exemption from U.S. withholding taxes with respect to any payments under or pursuant to the Loan Documents because such Person is eligible for the benefits of a tax treaty which provides for a zero % rate of tax on any payments under the Loan Documents or because any such payments to such Person are effectively connected with the conduct by such Person of a trade or business in the United States. (e) No Lender shall, as between and among the Borrower, the Administrative Agent and such Lender, be relieved of any of its obligations under the Loan Documents as a result of any sale, assignment, transfer or negotiation of, or granting of participations in, all or any part of its Loans, its Commitment or its Note, except that a Lender shall be relieved of its obligations to the extent of any such sale, assignment, transfer, or negotiation of all or any part of its Loans, its Commitment or its Note pursuant to paragraph (b) above. (f) Notwithstanding anything to the contrary contained in this Section, any Lender may at any time or from time to time assign all or any portion of its rights under the Loan Documents to a Federal Reserve Bank, provided that any such assignment shall not release such assignor from its obligations thereunder. 11.8 [Intentionally Omitted]. 11.9 Counterparts. Each Loan Document (other than the Notes) may be executed by one or more of the parties thereto on any number of separate counterparts and all of said counterparts taken together shall be deemed to constitute one and the same document. It shall not be necessary in making proof of any Loan Document to produce or account for more than one counterpart signed by the party to be charged. A telecopied counterpart of any Loan Document or to any document evidencing, and of any an amendment, modification, consent or waiver to or of any Loan Document shall be deemed to be an originally executed counterpart. A set of the copies of the Loan Documents signed by all the parties thereto shall be deposited with each of the Borrower and the Administrative Agent. Any party to a Loan Document may rely upon the signatures of any other party thereto which are transmitted by telecopier or other electronic means to the same extent as if originally signed. 11.10 Adjustments; Set-off. (a) If any Lender (a "Benefitted Lender") shall at any time receive any 76 77 payment of all or any part of its Loans or interest thereon, or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in Section 9.1(h) or (i), or otherwise) in a greater proportion than any such payment to and collateral received by any other Lender in respect of such other Lender's Loans or interest thereon, such Benefitted Lender shall purchase for cash from each of the other Lenders such portion of each such other Lender's Loans and shall provide each of such other Lenders with the benefits of any such collateral, or the proceeds thereof, as shall be necessary to cause such Benefitted Lender to share the excess payment or benefits of such collateral or proceeds ratably with each of the Lenders, provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefitted Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest. The Borrower agrees that each Lender so purchasing a portion of another Lender's Loans may exercise all rights of payment (including, without limitation, rights of set-off, to the extent not prohibited by law) with respect to such portion as fully as if such Lender were the direct holder of such portion. (b) In addition to any rights and remedies of the Lenders provided by law, upon the occurrence of an Event of Default and the acceleration of the obligations owing in connection with the Loan Documents, or at any time upon the occurrence and during the continuance of an Event of Default under Section 9.1(a) or (b), each Lender shall have the right, without prior notice to the Borrower, any such notice being expressly waived by the Borrower to the extent not prohibited by applicable law, to set-off and apply against any indebtedness, whether matured or unmatured, of the Borrower to such Lender, any amount owing from such Lender to the Borrower, at, or at any time after, the happening of any of the above-mentioned events. To the extent not prohibited by applicable law, the aforesaid right of set-off may be exercised by such Lender against the Borrower or against any trustee in bankruptcy, custodian, debtor in possession, assignee for the benefit of creditors, receiver, or execution, judgment or attachment creditor of the Borrower, or against anyone else claiming through or against the Borrower or such trustee in bankruptcy, custodian, debtor in possession, assignee for the benefit of creditors, receivers, or execution, judgment or attachment creditor, notwithstanding the fact that such right of set-off shall not have been exercised by such Lender prior to the making, filing or issuance, or service upon such Lender of, or of notice of, any such petition, assignment for the benefit of creditors, appointment or application for the appointment of a receiver, or issuance of execution, subpoena, order or warrant. Each Lender agrees promptly to notify the Borrower and the Administrative Agent after any such set-off and application made by such Lender, provided that the failure to give such notice shall not affect the validity of such set-off and application. 11.11 Lenders' Representations. Each Lender represents to the Administrative Agent that, in acquiring its Note, it is acquiring the same for its own account for the purpose of investment and not with a view to selling the same in connection with any distribution thereof, provided that the disposition of each Lender's own Property shall at all times be and remain within its control. 11.12 Indemnity. 77 78 The Borrower agrees to indemnify and hold harmless each Credit Party and its affiliates, directors, officers, employees, affiliates, agents, controlling persons and attorneys (each an "Indemnified Person") from and against any loss, cost, liability, damage or expense (including the reasonable fees and disbursements of counsel of such Indemnified Person, including all local counsel hired by any such counsel) incurred by such Indemnified Person in investigating, preparing for, defending against, or providing evidence, producing documents or taking any other action in respect of, any commenced or threatened litigation, administrative proceeding or investigation under any federal securities or tax laws or any other statute of any jurisdiction, or any regulation, or at common law or otherwise, which is alleged to arise out of or is based upon: (i) any untrue statement of any material fact by the Borrower in any document or schedule executed or filed with any Governmental Authority by or on behalf of the Borrower; (ii) any omission to state any material fact required to be stated in such document or schedule, or necessary to make the statements made therein, in light of the circumstances under which made, not misleading; or (iii) any acts, practices or omissions of the Borrower or its agents relating to the use of the proceeds of any or all borrowings made by the Borrower which are alleged to be in violation of Section 2.15, or in violation of any federal securities or tax laws or of any other statute, regulation or other law of any jurisdiction applicable thereto, whether or not such Indemnified Person is a party thereto. The indemnity set forth herein shall be in addition to any other obligations, liabilities or other indemnifications of the Borrower to each Indemnified Person under the Loan Documents or at common law or otherwise, and shall survive any termination of the Loan Documents, the expiration of the Commitments and the payment of all indebtedness of the Borrower under the Loan Documents, provided that the Borrower shall have no obligation under this Section to an Indemnified Person with respect to any of the foregoing to the extent found in a final judgment of a court having jurisdiction to have resulted primarily out of the gross negligence or willful misconduct of such Indemnified Person or arising solely from claims between one such Indemnified Person and another such Indemnified Person. 11.13 Governing Law. The Loan Documents and the rights and obligations of the parties thereunder shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of New York, without regard to principles of conflict of laws. 11.14 Headings Descriptive. Section headings have been inserted in the Loan Documents for convenience only and shall not be construed to be a part thereof. 11.15 Severability. Every provision of the Loan Documents is intended to be severable, and if any term or provision thereof shall be invalid, illegal or unenforceable for any reason, the validity, legality and enforceability of the remaining provisions thereof shall not be affected or impaired thereby, and any invalidity, illegality or unenforceability in any jurisdiction shall not affect the 78 79 validity, legality or enforceability of any such term or provision in any other jurisdiction. 11.16 Integration. All exhibits to a Loan Document shall be deemed to be a part thereof. The Loan Documents embody the entire agreement and understanding among the Borrower, the Administrative Agent and the Lenders with respect to the subject matter thereof and supersede all prior agreements and understandings among the Borrower, the Administrative Agent and the Lenders with respect to the subject matter thereof. 11.17 Consent to Jurisdiction. The Borrower and each of the Credit Parties hereby irrevocably submit to the jurisdiction of any New York State or Federal court sitting in the City of New York over any suit, action or proceeding arising out of or relating to the Loan Documents. The Borrower and each of the Credit Parties hereby irrevocably waive, to the fullest extent permitted or not prohibited by law, any objection which any of them may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in such a court and any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum. 11.18 Service of Process. The Borrower hereby agrees that process may be served against it in any suit, action or proceeding referred to in Section 11.17 by sending the same by first class mail, return receipt requested or by overnight courier service, to the address of the Borrower set forth in Section 11.2 or in the applicable Loan Document executed by the Borrower. The Borrower hereby agrees that any such service (i) shall be deemed in every respect effective service of process upon it in any such suit, action, or proceeding, and (ii) shall to the fullest extent enforceable by law, be taken and held to be valid personal service upon and personal delivery to it. 11.19 No Limitation on Service or Suit. Nothing in the Loan Documents or any modification, waiver, consent or amendment thereto shall affect the right of the Administrative Agent or any Lender to serve process in any manner permitted by law or limit the right of the Administrative Agent or any Lender to bring proceedings against the Borrower in the courts of any jurisdiction or jurisdictions in which the Borrower may be served. 11.20 WAIVER OF TRIAL BY JURY. THE ADMINISTRATIVE AGENT, THE LENDERS AND THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION 79 80 ARISING OUT OF, UNDER OR IN CONNECTION WITH THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREIN. FURTHER, THE BORROWER HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF THE ADMINISTRATIVE AGENT, THE LENDERS, OR COUNSEL TO THE ADMINISTRATIVE AGENT OR THE LENDERS, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE ADMINISTRATIVE AGENT OR THE LENDERS WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION. THE BORROWER ACKNOWLEDGES THAT THE ADMINISTRATIVE AGENT AND THE LENDERS HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, INTER ALIA, THE PROVISIONS OF THIS SECTION. 11.21 Termination. After the termination of this Agreement in accordance with its terms, without any extension thereof, and the payment in full of all obligations of the Borrower under the Loan Documents (including without limitation, all principal, interest, Facility Fees and other amounts payable hereunder and under the Notes), the obligations of the Borrower hereunder (other than those which are stated herein to survive any termination of this Agreement) shall terminate, except that the foregoing shall not apply with respect to any claim, action or proceeding made or brought under any other provision of the Loan Documents prior to such termination or payment. At the request of the Borrower, each Lender whose obligations under the Notes have been fully paid shall promptly return to the Borrower its Note marked "paid" or shall deliver other evidence that such Lender has received full payment of such obligations. 80 81 IN WITNESS WHEREOF, the parties hereto have caused this Credit Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written. NEW PLAN EXCEL REALTY TRUST, INC. By: /s/ DEAN BERNSTEIN ------------------------------------- Dean Bernstein Senior Vice President FLEET NATIONAL BANK, as Administrative Agent and a Lender By: /s/ DANIEL P. STEGEMOELLER ------------------------------------- Daniel P. Stegemoeller, Vice President 81 EX-10.42 13 GUARANTY DATED MARCH 7, 2000 1 EXHIBIT 10.42 GUARANTY GUARANTY (as the same may be amended, supplemented or otherwise modified from time to time, this "GUARANTY"), dated as of March 7, 2000, by and among each of the Subsidiaries listed on Schedule I hereto (collectively, the "SUBSIDIARY GUARANTORS") and FLEET NATIONAL BANK, as administrative agent (in such capacity, the "ADMINISTRATIVE AGENT") on behalf of the Lenders under and as defined in the Loan Agreement (hereinafter defined). RECITALS I. Reference is made to the Term Loan Agreement, dated as of the date hereof, by and among New Plan Excel Realty Trust, Inc., a Maryland corporation, the Lenders party thereto, and the Administrative Agent (as the same may be amended, supplemented or otherwise modified from time to time, the "LOAN AGREEMENT"). II. The Administrative Agent and the Lenders have made it a condition precedent to the effectiveness of the Loan Agreement that each Subsidiary Guarantor execute and deliver this Guaranty. III. Each Subsidiary Guarantor expects to derive substantial benefit from the Loan Agreement and the transactions contemplated thereby and, in furtherance thereof, has agreed to execute and deliver this Guaranty. Therefore, in consideration of the Recitals, the terms and conditions herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each of the Subsidiary Guarantors, the Borrower and the Administrative Agent hereby agree as follows: 1. DEFINED TERMS (a) Capitalized terms used herein which are not otherwise defined herein shall have the respective meanings ascribed thereto in the Loan Agreement. (b) When used in this Guaranty, the following capitalized terms shall have the respective meanings ascribed thereto as follows: "BORROWER OBLIGATIONS" means all present and future obligations and liabilities, whether deemed principal, interest, additional interest, fees, expenses or otherwise of the Borrower to the Administrative Agent and the Lenders, including, without limitation, all obligations under (i) the Loan Agreement, (ii) the Notes and (iii) all other Loan Documents. 1 2 "GUARANTOR OBLIGATIONS" means, with respect to each Subsidiary Guarantor, all of the obligations and liabilities of such Subsidiary Guarantor hereunder, whether fixed, contingent, now existing or hereafter arising, created, assumed, incurred or acquired. 2. GUARANTEE (a) Subject to Section 2(b), each Subsidiary Guarantor hereby absolutely, irrevocably and unconditionally guarantees the full and prompt payment when due (whether at stated maturity, by acceleration or otherwise) of the Borrower Obligations. The agreements of each Subsidiary Guarantor in this Guaranty constitute a guarantee of payment, and no Credit Party shall have any obligation to enforce any Loan Document or exercise any right or remedy with respect to any collateral security thereunder by any action, including making or perfecting any claim against any Person or any collateral security for any of the Borrower Obligations prior to being entitled to the benefits of this Guaranty. The Administrative Agent may, at its option, proceed against the Subsidiary Guarantors, or any one or more of them, in the first instance, to enforce the Guarantor Obligations without first proceeding against the Borrower or any other Person, and without first resorting to any other rights or remedies, as the Administrative Agent may deem advisable. In furtherance hereof, if any Credit Party is prevented by law from collecting or otherwise hindered from collecting or otherwise enforcing any Borrower Obligation in accordance with its terms, such Credit Party shall be entitled to receive hereunder from the Subsidiary Guarantors after demand therefor, the sums which would have been otherwise due had such collection or enforcement not been prevented or hindered. (b) Notwithstanding anything to the contrary contained herein, the maximum aggregate amount of the obligations of each Subsidiary Guarantor hereunder shall not, as of any date of determination, exceed the lesser of the greatest amount that is valid and enforceable against such Subsidiary Guarantor under principles of New York State contract law and the greatest amount that would not render such Subsidiary Guarantor's liability hereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11 of the United States Code or any provisions of applicable state law (collectively, the "FRAUDULENT TRANSFER LAWS"), in each case after giving effect to all other liabilities of such Subsidiary Guarantor, contingent or otherwise, that are relevant under the Fraudulent Transfer Laws (specifically excluding, however, any liability (A) in respect of intercompany indebtedness to the Borrower or any Affiliate or Subsidiary of the Borrower, to the extent that such intercompany indebtedness would be discharged to the extent payment is made by such Subsidiary Guarantor hereunder, and (B) under any guarantee of (1) senior unsecured indebtedness or (2) indebtedness subordinated in right of payment to any Borrower Obligation, in either case which contains a limitation as to maximum liability similar to that set forth in this Section 2(b) and pursuant to which the liability of such Subsidiary Guarantor hereunder is included in the liabilities taken into account in 2 3 determining such maximum liability) and after giving effect as assets to the value (as determined under the applicable provisions of the Fraudulent Transfer Laws) of any rights to subrogation, contribution, reimbursement, indemnity or similar rights of such Subsidiary Guarantor pursuant to applicable law or any agreement providing for an equitable allocation among such Subsidiary Guarantor and other Affiliates or Subsidiaries of the Borrower of obligations arising under guarantees by such parties. (c) Each Subsidiary Guarantor agrees that the Guarantor Obligations may at any time and from time to time exceed the maximum aggregate amount of the obligations of such Subsidiary Guarantor hereunder without impairing this Guaranty or affecting the rights and remedies of any Credit Party hereunder. 3. ABSOLUTE OBLIGATION No Subsidiary Guarantor shall be released from liability hereunder unless and until the Commitments of the Lenders have terminated and either (i) the Borrower shall have paid in full the outstanding principal balance of the Loans, together with all accrued and unpaid interest thereon, and all other amounts then due and owing under the Loan Documents, or (ii) the Guarantor Obligations of such Subsidiary Guarantor shall have been paid in full in cash. Each Subsidiary Guarantor acknowledges and agrees that (a) no Credit Party has made any representation or warranty to such Subsidiary Guarantor with respect to the Borrower, any of its Subsidiaries, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or any other matter whatsoever, and (b) such Subsidiary Guarantor shall be liable hereunder, and such liability shall not be affected or impaired, irrespective of (A) the validity or enforceability of any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or the collectibility of any of the Borrower Obligations, (B) the preference or priority ranking with respect to any of the Borrower Obligations, (C) the existence, validity, enforceability or perfection of any security interest or collateral security under any Loan Document, or the release, exchange, substitution or loss or impairment of any such security interest or collateral security, (D) any failure, delay, neglect or omission by any Credit Party to realize upon or protect any direct or indirect collateral security, indebtedness, liability or obligation, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, or any of the Borrower Obligations, (E) the existence or exercise of any right of set-off by any Credit Party, (F) the existence, validity or enforceability of any other guarantee with respect to any of the Borrower Obligations, the liability of any other Person in respect of any of the Borrower Obligations, or the release of any such Person or any other guarantor of any of the Borrower Obligations, (G) any act or omission of any Credit Party in connection with the administration of any Loan Document or any of the Borrower Obligations, (H) the bankruptcy, insolvency, reorganization or receivership of, or any other proceeding for the relief of debtors commenced by or against, any Person, (I) the 3 4 disaffirmance or rejection, or the purported disaffirmance or purported rejection, of any of the Borrower Obligations, any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith, in any bankruptcy, insolvency, reorganization or receivership, or any other proceeding for the relief of debtor, relating to any Person, (J) any law, regulation or decree now or hereafter in effect which might in any manner affect any of the terms or provisions of any Loan Document, or any agreement, instrument or document executed or delivered in connection therewith or any of the Borrower Obligations, or which might cause or permit to be invoked any alteration in the time, amount, manner or payment or performance of any of the Borrower's obligations and liabilities (including the Borrower Obligations), (K) the merger or consolidation of the Borrower into or with any Person, (L) the sale by the Borrower of all or any part of its assets, (M) the fact that at any time and from time to time none of the Borrower Obligations may be outstanding or owing to any Credit Party, (N) any amendment or modification of, or supplement to, any Loan Document, or (O) any other reason or circumstance which might otherwise constitute a defense available to or a discharge of the Borrower in respect of its obligations or liabilities (including the Borrower Obligations) or of such Subsidiary Guarantor in respect of any of the Guarantor Obligations (other than by the performance in full thereof). 4. REPRESENTATIONS AND WARRANTIES Each of the Subsidiary Guarantors represents and warrants as to itself that all representations and warranties relating to it contained in the Loan Agreement are true and correct. 5. NOTICES Except as otherwise specifically provided herein, all notices, requests, consents, demands, waivers and other communications hereunder shall be in writing (including facsimile) and shall be given in the manner set forth in Section 11.2 of the Loan Agreement (i) in the case of the Administrative Agent, to the address set forth in Section 11.2 of the Loan Agreement, (ii) in the case of a Subsidiary Guarantor, to the address set forth in Schedule I hereto, or (iii) in the case of each party hereto, to such other addresses as to which the Administrative Agent may be hereafter notified by the respective parties hereto. 6. EXPENSES Each Subsidiary Guarantor agrees that it shall, promptly after demand, pay to the Administrative Agent any and all reasonable out-of-pocket sums, costs and expenses, which any Loan Party may pay or incur defending, protecting or enforcing this Guaranty (whether suit is instituted or not), reasonable attorneys' fees and disbursements. All sums, costs and expenses 4 5 which are due and payable pursuant to this Section shall bear interest, payable on demand, at the highest rate then payable on the Borrower Obligations. 7. REPAYMENT IN BANKRUPTCY, ETC. If, at any time or times subsequent to the payment of all or any part of the Borrower Obligations or the Guarantor Obligations, any Credit Party shall be required to repay any amounts previously paid by or on behalf of the Borrower or any Subsidiary Guarantor in reduction thereof by virtue of an order of any court having jurisdiction in the premises, including as a result of an adjudication that such amounts constituted preferential payments or fraudulent conveyances, the Subsidiary Guarantors unconditionally agree to pay to the Administrative Agent, within 10 days after demand, a sum in cash equal to the amount of such repayment, together with interest on such amount from the date of such repayment by such Credit Party to the date of payment to the Administrative Agent at the applicable after-maturity rate set forth in the Loan Agreement. 8. MISCELLANEOUS (a) Except as otherwise expressly provided in this Guaranty, each Subsidiary Guarantor hereby waives presentment, demand for payment, notice of default, nonperformance and dishonor, protest and notice of protest of or in respect of this Guaranty, the other Loan Documents and the Borrower Obligations, notice of acceptance of this Guaranty and reliance hereupon by any Credit Party, and the incurrence of any of the Borrower Obligations, notice of any sale of collateral security or any default of any sort. (b) No Subsidiary Guarantor is relying upon any Credit Party to provide to such Subsidiary Guarantor any information concerning the Borrower or any of its Subsidiaries, and each Subsidiary Guarantor has made arrangements satisfactory to such Subsidiary Guarantor to obtain from the Borrower on a continuing basis such information concerning the Borrower and its Subsidiaries as such Subsidiary Guarantor may desire. (c) Each Subsidiary Guarantor agrees that any statement of account with respect to the Borrower Obligations from any Credit Party to the Borrower which binds the Borrower shall also be binding upon such Subsidiary Guarantor, and that copies of said statements of account maintained in the regular course of or such Credit Party's business may be used in evidence against such Subsidiary Guarantor in order to establish its Guarantor Obligations. (d) Each Subsidiary Guarantor acknowledges that it has received a copy of the Loan Documents and has approved of the same. In addition, each Subsidiary Guarantor 5 6 acknowledges having read each Loan Document and having had the advice of counsel in connection with all matters concerning its execution and delivery of this Guaranty. (e) This Guaranty shall be binding upon each Subsidiary Guarantor and its successors and inure to the benefit of, and be enforceable by the Administrative Agent, Lenders and their respective successors, transferees and assigns. No Subsidiary Guarantor may assign any right, or delegate any duty, it may have under this Guaranty. (f) Subject to the limitations set forth in Section 2(b), the Guarantor Obligations shall be joint and several. (g) This Guaranty is the "Guaranty" referred to in the Loan Agreement, and is subject to, and should be construed in accordance with, the provisions thereof. Each of the parties hereto acknowledges and agrees that the following provisions of the Loan Agreement are made applicable to this Guaranty and all such provisions are incorporated by reference herein as if fully set forth herein, including Sections 1 (Definitions), 2.13 (Taxes; Net Payments), 9.1 (Events of Default), 11.1 (Amendments and Waivers), 11.3 (No Waiver; Cumulative Remedies), 11.5 (Payment of Expenses and Taxes), 11.7 (Successors and Assigns), 11.9 (Counterparts), 11.12 (Indemnity), 11.13 (Governing Law), 11.14, (Headings Description), 11.15 (Severability), 11.16 (Integration), 11.17 (Consent to Jurisdiction), 11.18 (Service of Process), 11.19 (No Limitation on Service or Suit) and 11.20 (WAIVER OF TRIAL BY JURY) thereof. (h) Each Subsidiary Guarantor agrees that (i) the execution and delivery of a Guaranty by any Required Additional Guarantor after the date hereof shall not affect the obligations of the Subsidiary Guarantors hereunder, and (ii) the Subsidiary Guarantors and each such Required Additional Guarantor shall, subject to Section 2(b), be jointly and severally liable for all of the Borrower Obligations. (i) [IF THIS GUARANTY IS BEING EXECUTED BY A REQUIRED ADDITIONAL GUARANTOR: THE UNDERSIGNED SUBSIDIARY GUARANTOR IS A REQUIRED ADDITIONAL GUARANTOR AND ACKNOWLEDGES AND AGREES THAT IT IS EXECUTING THIS GUARANTY IN ACCORDANCE WITH THE REQUIREMENTS OF THE LOAN AGREEMENT IN ORDER TO INDUCE THE CREDIT PARTIES TO MAKE ADDITIONAL LOANS AND AS CONSIDERATION FOR LOANS PREVIOUSLY MADE OR ISSUED. THE UNDERSIGNED SUBSIDIARY GUARANTOR AGREES THAT, SUBJECT TO SECTION 2(b), IT IS JOINTLY AND SEVERALLY LIABLE WITH ALL OTHER SUBSIDIARIES WHO HAVE PREVIOUSLY EXECUTED AND DELIVERED A GUARANTY PURSUANT TO THE LOAN AGREEMENT FOR ALL OF THE BORROWER OBLIGATIONS. 6 7 IN EVIDENCE of the agreement by the parties hereto to the terms and conditions herein contained, each such party has caused this Subsidiary Guarantee to be duly executed on its behalf. NEW PLAN REALTY TRUST, a Massachusetts business trust By: /s/ Dean Bernstein ---------------------------------- Name: ---------------------------------- Title: ---------------------------------- EXCEL REALTY - ST, INC., a Delaware corporation By: /s/ Dean Bernstein ---------------------------------- Name: ---------------------------------- Title: ---------------------------------- [CORPORATE SEAL] FLEET NATIONAL BANK, as Administrative Agent By: /s/ Daniel P. Stegemoeller ---------------------------------- Name: Daniel P. Stegemoeller ---------------------------------- Title: Vice President ---------------------------------- 7 8 SCHEDULE I TO SUBSIDIARY GUARANTY SUBSIDIARY GUARANTORS UNDER GUARANTY DATED AS OF MARCH 7, 2000
Jurisdiction of Incorporation Address for Name or Formation Notices - --------------------- ----------------------------- -------------------------- New Plan Realty Trust Massachusetts c/o New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas New York, New York 10036 Excel Realty - ST, Inc. Delaware c/o New Plan Excel Realty Trust, Inc. 1120 Avenue of the Americas New York, New York 10036
EX-12 14 RATIO OF EARNINGS TO FIXED CHARGES 1 EXHIBIT 12 RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS The following table sets forth the ratio of earnings to fixed charges and preferred stock dividend requirements for the periods indicated:
FIVE MONTHS YEARS ENDED JULY 31, ENDED YEAR ENDED --------------------- DECEMBER 31, DECEMBER 31 1996 1997 1998 1998 1999 ---- ----- ----- ------------ ----------- 4.9 3.5 3.0 3.1 2.2
For purposes of computing these ratios, earnings have been calculated by adding fixed charges (excluding capitalized interest and preferred stock dividends) to income before extraordinary items. Fixed charges consist of interest costs, whether expensed or capitalized, preferred stock dividend requirements, the interest component of rental expense, if any, and amortization of debt discounts and issue costs, whether expensed or capitalized. CALCULATION OF COMBINED RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS YEAR ENDED DECEMBER 31, 1999 (DOLLAR AMOUNTS IN THOUSANDS) (Private) Earnings: Net income................................................ $149,513 Interest expense (including amortization of debt discount and issuing costs)..................................... 81,412 Equity in loss of affiliates.............................. 3,169 Other adjustments......................................... 452 -------- $234,546 ======== Fixed Charges: Interest expense (including amortization of debt discount and issuing costs)..................................... $ 81,412 Capitalized interest...................................... 126 Preferred stock dividends................................. 22,777 Other adjustments......................................... 374 -------- $104,689 ======== Ratio of Earnings to Fixed Charges.......................... 2.2
EX-21 15 SUBSIDIARIES OF THE REGISTRANT 1 EXHIBIT 21 SUBSIDIARIES OF THE REGISTRANT New Plan Realty Trust, a Massachusetts business trust New Plan Securities Corp., a New York corporation New Plan Realty of Alabama, Inc., an Alabama corporation Avion Service Corp., a Pennsylvania corporation New Plan Realty of Kingsport, Inc., a Tennessee corporation New Plan Factory Malls, Inc., a Delaware corporation New Plan of Tara, Inc., a Delaware corporation New Plan of Fashion Corners, Inc., a Delaware corporation New Plan Disbursing Corp., a Delaware corporation New Plan Realty of Louisiana, Inc., a Delaware corporation New Plan of Tennessee, Inc., a Delaware corporation New Plan Realty of Louisiana, L.P., a Delaware limited partnership New Plan of Waterford Place, L.P., a Delaware limited partnership New Plan of Tennessee, L.P., a Delaware limited partnership New Plan of New Garden, Inc., a Delaware corporation New Plan of New Jersey, Inc., a Delaware corporation New Plan of Tinton Falls, Inc., a Delaware corporation New Plan of Eastgreen, Inc., a Delaware corporation New Plan of Northgate, Inc., a Delaware corporation New Plan of Polo Run, Inc., a Delaware corporation NC Properties #1, Inc., a Delaware corporation NC Properties #2, Inc., a Delaware corporation Excel Realty Trust -- NC, a North Carolina partnership TX Properties #1, Inc., a Delaware corporation TX Properties #2, Inc., a Delaware corporation Excel Realty Trust -- TX, L.P., a Texas limited partnership Excel Realty -- PA, Inc., a Delaware corporation Excel Realty -- NE, Inc., a Nebraska corporation Excel Realty -- ST, Inc., a Delaware corporation Excel Westminster Marketplace, Inc., a Delaware corporation Excel Realty Partners, L.P., a Delaware limited partnership E.H. Properties, L.P., a Delaware limited partnership New Plan DRP Trust, a Maryland business trust EX-23 16 CONSENT OF PRICEWATERHOUSECOOPERS LLP. 1 EXHIBIT 23 CONSENT OF INDEPENDENT ACCOUNTANTS We consent to the incorporation by reference in the registration statements of New Plan Excel Realty Trust, Inc. on Form S-3 (File Nos. 333-01569, 333-13943, 333-20005, 333-24615, 333-64203, 333-65211, 333-67511 and 333-87905) and Form S-8 (File Nos. 333-02329, 333-13481, 333-65223, 333-65193, 333-65221 and 333-85549) of our report dated February 17, 2000, on our audits of the consolidated financial statements and financial statement schedules of New Plan Excel Realty Trust, Inc. as of December 31, 1999 and 1998, and July 31, 1998 and for the year ended December 31, 1999, the five months ended December 31, 1998 and for each of the two years in the period ended July 31, 1998, which report is included in this Annual Report on Form 10-K. /s/ PricewaterhouseCoopers LLP New York, New York March 21, 2000 EX-27 17 FINANCIAL DATA SCHEDULE
5 YEAR DEC-31-1999 JAN-01-1999 DEC-31-1999 10,834 1,190 30,225 13,897 0 0 2,880,645 216,274 2,953,141 0 1,193,100 0 23 875 (97,565) 2,953,141 0 438,027 0 207,616 1,299 6,144 81,412 149,513 0 149,513 0 0 0 149,513 1.43 1.42
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