Exhibit 10.10

 

Third Amendment to Credit Agreement and Waiver

 

This Third Amendment to Credit Agreement and Waiver (herein, this “Amendment”)
is entered into as of November 4, 2013, by and among Trade Street Operating
Partnership, LP, a Delaware limited partnership (the “Borrower”), Trade Street
Residential, Inc., a Maryland corporation (“Trade Street REIT”), the other
Guarantors party hereto, the Lenders party hereto and BMO Harris Bank N.A., as
Administrative Agent.

 

Preliminary Statements

 

A.     The Borrower, the Guarantors, the Lenders and the Administrative Agent
are parties to a Credit Agreement, dated as of January 31, 2013 (as amended or
otherwise modified from time to time, the “Credit Agreement”). All capitalized
terms used herein without definition shall have the same meanings herein as such
terms have in the Credit Agreement.

 

B.     The Borrower has requested that Administrative Agent and the Lenders
waive compliance with certain section(s) of, and make certain amendments to, the
Credit Agreement as set forth below, and the Administrative Agent and the
Lenders are willing to do so pursuant to the terms and conditions set forth
herein.

 

Now, Therefore, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:

 

Section 1.            Amendments to Credit Agreement.

 

Subject to the satisfaction of the conditions precedent set forth in Section 3
below, the Credit Agreement shall be and hereby is amended as follows:

 

1.1.          The definitions of “Assets Under Development,” “Borrowing Base,”
“Borrowing Base Requirements,” “Borrowing Base Value,” “Capitalization Rate,”
“Debt Service Coverage Amount,” “Eligible Property” and “Total Asset Value” set
forth in Section 5.1 of the Credit Agreement (Definitions) are amended and
restated in their entirety to read as follows:

 

“Assets Under Development” means any real property under construction (excluding
any completed Property under minor renovation).

 

“Borrowing Base” means, at any date of its determination, an amount equal to the
lesser of (A) 75% of the Borrowing Base Value of all Eligible Properties on such
date on or prior to December 31, 2014 and 65% of the Borrowing Base Value of all
Eligible Properties on such date after December 31, 2014 and (B) the sum of Debt
Service Coverage Amount and Interest Expense Coverage Amount of all Eligible
Properties on such date.

 

 

 

 

“Borrowing Base Requirements” means at all times after June 30, 2015 with
respect to the calculation of the Borrowing Base, collectively that (a) such
calculation shall be based on no less than four (4) Eligible Properties; (b) the
Borrowing Base Value shall be equal to or in excess of $75,000,000; and (c) no
more than 35% of the Borrowing Base Value may be comprised of any one Eligible
Property.

 

“Borrowing Base Value” means, as at any date of its determination, an amount
equal to the sum of (a) for all Eligible Properties owned for more than twelve
(12) months and included in the Borrowing Base for more than twelve (12) months,
the quotient of (i) the Borrowing Base NOI divided by (ii) the Capitalization
Rate plus (b) for all Eligible Properties owned for more than twelve (12) months
but included in the Borrowing Base for less than twelve (12) months the “as-is”
appraised value set forth in a current Appraisal for Stabilized Properties and
the “as-stabilized” appraisal value set forth in a current Appraisal for
Pre-stabilized Properties plus (c) for all Eligible Properties owned for twelve
(12) months or less, the lesser of (i) for Stabilized Properties, the “as-is”
appraised value set forth in a current Appraisal and for Pre-stabilized
Properties, the “as-stabilized” appraised value set forth in a current Appraisal
and (ii) the book value (as defined by GAAP) of any such Eligible Property;
provided that Borrowing Base Value shall be reduced by excluding any value
attributable to an Eligible Property that exceeds the concentration limit set
forth in clause (c) of the definition of Borrowing Base Requirements and clause
(h) of the definition of Eligible Property. In addition, in the case of any
Eligible Property where the maximum principal liability of the applicable
Guarantor owning such Eligible Property has been limited in the applicable
Mortgage due to mortgage tax, the amount of Borrowing Base Value attributable to
such Eligible Property shall not exceed such stated maximum principal liability.
The determination of whether an Appraisal is current shall be made by the
Administrative Agent.

 

“Capitalization Rate” means, on or prior to September 30, 2014, 6.5% for
multifamily residential Properties and after September 30, 2014, 7.0% for
multifamily residential Properties.

 

“Debt Service Coverage Amount” means the aggregate sum of, for each of the
Stabilized Properties, the principal amount of the loan that would be serviced
by the Borrowing Base NOI for such Stabilized Property for the Fiscal Quarter
most recently ended for which financial statements have been delivered pursuant
to Section 8.5 hereof computed on an annualized basis at a debt service coverage
ratio of 1.25 to 1.00 for the period through December 31, 2014 and thereafter a
debt service coverage ratio of 1.35 to 1.00, with interest and principal
payments (in each case assuming a 30-year amortization) at the Implied Interest
Rate; provided that Borrowing Base NOI shall be reduced by excluding any
Property NOI attributable to Eligible Properties that exceed the concentration
limits set forth in clause (c) of the definition of Borrowing Base Requirements.

 

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“Eligible Property” means any Property owned by the Borrower or a Guarantor
which satisfies the following conditions which would permit such Property’s
value to be included in the Borrowing Base Value and which is pledged as
Collateral pursuant to the terms hereof:

 

(a)        Is real property one hundred percent (100%) owned in fee simple,
individually or collectively, by the Borrower or any Guarantor;

 

(b)        Is a Property located in the contiguous United States;

 

(c)        If such Property is owned by the Borrower, (i) neither the Borrower’s
beneficial ownership interest in such Property nor the Property is subject to
any Lien (other than certain Permitted Liens or Liens in favor of the
Administrative Agent) or to any negative pledge and (ii) the Borrower has the
unilateral right to sell, transfer or otherwise dispose of such Property and to
create a Lien on such Property as security for Indebtedness for Borrowed Money;

 

(d)        If such Property is owned by a Material Subsidiary, (i) neither the
Borrower’s beneficial ownership interest in such Material Subsidiary nor the
Property is subject to any Lien (other than certain Permitted Liens or Liens in
favor of the Administrative Agent) or to any negative pledge, (ii) the Material
Subsidiary has the unilateral right to sell, transfer or otherwise dispose of
such Property and to create a Lien on such Property as security for Indebtedness
for Borrowed Money, and (iii) the Material Subsidiary has provided an Additional
Guarantor Supplement or other Guaranty to the Administrative Agent pursuant to
Section 4.2 hereof;

 

(e)        The Administrative Agent shall have received to the extent requested
historic operating statements for such Property for the previous three (3)
years, if available, and historic rent rolls for such Property for the previous
one (1) year, if available;

 

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(f)        That such Property, based on the Borrower’s or any Material
Subsidiary’s actual knowledge, is free of all material structural defects or
major architectural deficiencies, material title defects, material environmental
conditions or other adverse matters which, individually or collectively,
materially impair the value of such Property;

 

(g)        For each such Property, the Borrower, to the extent not previously
provided, shall have delivered to the Administrative Agent a copy, certified as
true and correct by the Borrower, of each of the following: if the Property
Owner is not the Borrower, the Property Owner’s articles of incorporation,
by-laws, partnership agreements, operating agreements, as applicable, and
certificates of existence, good standing and authority to do business from each
appropriate state authority, and partnership, corporate or limited liability
company, as applicable, authorizations authorizing the execution, delivery and
performance of the Additional Guarantor Supplement all certified to be true and
complete by a duly authorized officer of such Property Owner;

 

(h)        The Property is a Stabilized Property or a Pre-stabilized Property
but is not an Asset Under Development, provided that no more than two (2)
Pre-stabilized Properties shall be Eligible Properties and included in the
Borrowing Base at any one time;

 

(i)         The Property is encumbered by a Mortgage in favor of the
Administrative Agent for the benefit of the Lenders and the applicable Eligible
Property Operating Account is encumbered by a Security Agreement re: Operating
Account in favor of the Administrative Agent for the benefit of the Lenders; and

 

(j)         The Administrative Agent has received the Required Diligence for the
Property.

 

“Total Asset Value” means an amount equal to the sum of (a) for all Eligible
Properties valued at their appraised value for purposes of computing their
Borrowing Base Value, the “as-is” appraised value set forth in a current
Appraisal for Stabilized Properties and the “as-stabilized” appraised value set
forth in a current Appraisal for Pre-stabilized Properties, (b) for all other
Properties owned for more than twelve (12) months, the quotient of (i) the
Property NOI from such Properties divided by (ii) the Capitalization Rate plus
(c) for all Properties owned for twelve (12) months or less, the book value (as
defined in GAAP) of any such property plus (d) the aggregate book value of all
Land Assets, mortgage or mezzanine loans, notes receivable and/or Assets Under
Development plus (e) unrestricted cash, unrestricted cash equivalents and
marketable securities owned by the Borrower and its Subsidiaries as of the end
of such fiscal quarter, provided that the amount added to Total Asset Value for
unrestricted cash, unrestricted cash equivalents and marketable securities shall
not exceed 5% of Total Asset Value.

 

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1.2.          Section 5.1 of the Credit Agreement (Definitions) is hereby
amended to add the following definitions:

 

“Implied Interest Rate” means, as of the date of determination, the greatest of
(i) 5.50% per annum, (ii) the per annum interest rate on a Eurodollar Loan with
an Interest Period of one (1) month (including the Applicable Margin) and
(iii) the 10-year Treasury Rate plus 2.50%.

 

“Interest Expense Coverage Amount” means the aggregate sum of, for each of the
Pre-stabilized Properties included in the Borrowing Base for less than twelve
(12) months, the principal amount of the loan that would be serviced by the
Borrowing Base NOI for such Pre-stabilized Property for the Fiscal Quarter most
recently ended for which financial statements have been delivered pursuant to
Section 8.5 hereof computed on an annualized basis at an interest expense
coverage ratio of 1.25 to 1.00 for the period through December 31, 2014 and
thereafter an interest expense coverage ratio of 1.35 to 1.00, with interest
payments at the Implied Interest Rate; provided that Borrowing Base NOI shall be
reduced by excluding any Property NOI attributable to Eligible Properties that
exceed the concentration limits set forth in clause (c) of the definition of
Borrowing Base Requirements.

 

“Pre-stabilized Property” means a property that has been completed for less than
12 months and has not yet reached 90% occupancy, provided, after 12 months of
completion, a property previously deemed as a Pre-Stabilized Property shall be
considered a Stabilized Property even if the property has not yet reached 90%
occupancy.

 

“Stabilized Property” means a property that has i) been completed for over 12
months or ii) been completed for less than 12 months, but has reached 90%
occupancy.

 

-5-

 

 

“Treasury Rate” means the “weekly average yield” on United States Treasury
Securities adjusted to a constant maturity of ten (10) years, as published in
the Federal Reserve Statistical Release (“Release”) seven (7) Business Days
prior to the date of determination, provided that, if the Release is no longer
published, a reasonable equivalent substitute therefor as may be selected by
Lender in its discretion is utilized, and further provided that if the Release
is not published seven (7) Business Days prior to the date of determination,
then the Release as published on the most recent date prior thereto is
utilized. 

 

1.3           Section 8.20(a) of the Credit Agreement (Maximum Total
Indebtedness to Total Asset Value Ratio) is amended and restated in its entirety
to read as follows:

 

(a) Maximum Total Indebtedness to Total Asset Value Ratio. As of the last day of
each Fiscal Quarter of the Borrower through December 31, 2014, the Borrower
shall not permit the ratio of Total Indebtedness to Total Asset Value for the
applicable Fiscal Quarter then ended computed on an annualized basis to be
greater than 0.70 to 1.00 and as of the last day of each Fiscal Quarter
thereafter, the Borrower shall not permit the ratio of Total Indebtedness to
Total Asset Value for the applicable Fiscal Quarter then ended computed on an
annualized basis to be greater than 0.65 to 1.00.

 

1.4.          The table set forth in Section 8.20(b) of the Credit Agreement
(Minimum Adjusted EBITDA to Fixed Charges Ratio) is amended and restated in its
entirety to read as follows:

 

Fiscal Quarter ending Ratio December 31, 2012 through and including December 31,
2014 1.15 to 1.00 March 31, 2015 through and including September 30, 2015 1.25
to 1.00 December 31, 2015
and thereafter 1.50 to 1.00

 

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1.5.          Section 8.25 of the Credit Agreement (Restricted Payments) is
amended and restated in its entirety to read as follows:

 

Section 8.25. Restricted Payments. The Borrower shall not, nor shall it permit
Trade Street REIT or any Subsidiary to declare or make any Restricted Payment;
provided that (i) Trade Street REIT and the Borrower may declare or make cash
distributions to its stockholders or unit holders, respectively, (a) through
December 31, 2014, in such amounts as Trade Street REIT and the Borrower may
determine in the exercise of their good faith business judgment and (b)
commencing January 1, 2015 and thereafter, in an aggregate amount for any Fiscal
Quarter not to exceed the greater of (1) ninety five percent (95%) of the
Borrower’s Funds from Operations or (2) the amount equivalent to be distributed
for Trade Street REIT to maintain its status as a REIT under the Code, (ii) any
Subsidiary may make Restricted Payments to the Borrower, and (iii) the Borrower
and Trade Street REIT may exercise any redemption or conversion rights with
respect to the equity interests of the Borrower or Trade Street REIT in
accordance with the terms of the governing documents setting out any such
rights.

 

1.6           Schedule I to Exhibit D of the Credit Agreement (Compliance
Certificate) is amended and restated in its entirety to read as set forth on
Schedule I to Compliance Certificate attached hereto and made a part hereof.

 

1.7           Exhibit H of the Credit Agreement (Borrowing Base Certificate) is
amended and restated in its entirety to read as set forth on Exhibit H attached
hereto and made a part hereof.

 

Section 2.            Waivers.

 

2.1.          The Borrower has requested that the Administrative Agent and the
Lenders not require compliance with the ninety-five percent (95%) restriction in
the exception to the Restricted Payments covenant set forth in Section 8.25 of
the Credit Agreement for the reporting periods ending December 31, 2012,
March 31, 2013, June 30, 2013 and September 30, 2013 (such covenant, solely for
such periods, being referred to herein collectively as the “Specified Covenant
Requirements”).

 

2.2.          Upon satisfaction of the conditions precedent set forth in Section
3 hereof, the Lenders and the Administrative Agent hereby waive the requirement
of compliance with the Specified Covenant Requirements and any Event of Default
arising solely from the Specified Covenant Requirements. The Borrower and the
Guarantors acknowledge that the waivers under this Section 2 are specifically
limited to the Specified Covenant Requirements and any Event of Default arising
solely from the Specified Covenant Requirements. Except as specifically waived
hereby, all terms and conditions of the Credit Agreement shall stand and remain
in full force and effect.

 

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Section 3.            Conditions Precedent.

 

The effectiveness of this Amendment is subject to the satisfaction of all of the
following conditions precedent:

 

3.1.         The Borrower, the Guarantors, the Administrative Agent and the
Lenders shall have executed and delivered this Amendment.

 

3.2.         Legal matters incident to the execution and delivery of this
Amendment shall be satisfactory to the Administrative Agent and its counsel.

 

Section 4.            Representations.

 

In order to induce the Lenders to execute and deliver this Amendment, the
Borrower and the Guarantors hereby represent to the Administrative Agent and the
Lenders that, as of the date hereof, after giving effect to the amendments and
waivers set forth in Sections 1 and 2 above, (a) the representations and
warranties set forth in Section 6 of the Credit Agreement and in the other Loan
Documents are and shall be and remain true and correct, except that the
representations contained in Section 6.5 shall be deemed to refer to the most
recent financial reports of the Borrower delivered to the Lenders, and (b) the
Borrower and the Guarantors are in compliance with the terms and conditions of
the Credit Agreement and the other Loan Documents and no Default or Event of
Default exists or shall result after giving effect to this Amendment.

 

Section 5.            Miscellaneous.

 

5.1.          The Borrower and the Guarantors heretofore executed and delivered
to the Administrative Agent and the Lenders certain Mortgages and Security
Agreements re: Operating Accounts (collectively, the “Collateral Documents”).
The Borrower and the Guarantors hereby acknowledge and agree that the Liens
created and provided for by the Collateral Documents continue to secure, among
other things, the Obligations arising under the Credit Agreement as amended
hereby; and the Collateral Documents and the rights and remedies of the
Administrative Agent and the Lenders thereunder, the obligations of the Borrower
and the Guarantors thereunder, and the Liens created and provided for thereunder
remain in full force and effect and shall not be affected, impaired or
discharged hereby. Nothing herein contained shall in any manner affect or impair
the priority of the Liens created and provided for by the Collateral Documents
as to the indebtedness which would be secured thereby prior to giving effect to
this Amendment.

 

5.2.          By executing this Amendment in the place provided for that purpose
below, each Guarantor hereby consents to the amendment to the Credit Agreement
as set forth herein and confirms that its obligations thereunder (including
without limitation its obligations as a Guarantor pursuant to Section 13 of the
Credit Agreement) remain in full force and effect. Each Guarantor further agrees
that the consent of such Guarantor to any further amendments to the Credit
Agreement (other than Section 13 thereof) or any other Loan Document shall not
be required as a result of this consent having been obtained.

 

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5.3.          Except as specifically amended or waived herein, the Credit
Agreement shall continue in full force and effect in accordance with its
original terms. Reference to this specific Amendment need not be made in the
Credit Agreement, the Collateral Documents, the Notes or any other instrument or
document executed in connection therewith, or in any certificate, letter or
communication issued or made pursuant to or with respect to the Credit
Agreement, any reference in any of such items to the Credit Agreement being
sufficient to refer to the Credit Agreement as amended hereby.

 

5.4.          The Borrower agrees to pay on demand all reasonable costs and
expenses of or incurred by the Administrative Agent in connection with the
negotiation, preparation, execution and delivery of this Amendment and the other
instruments and documents to be executed and delivered in connection herewith,
including the reasonable fees and expenses of counsel for the Administrative
Agent.

 

5.5.          This Amendment may be executed in any number of counterparts, and
by the different parties on different counterpart signature pages, all of which
taken together shall constitute one and the same agreement. Any of the parties
hereto may execute this Amendment by signing any such counterpart and each of
such counterparts shall for all purposes be deemed to be an original. Delivery
of a counterpart hereof by facsimile transmission or by e-mail transmission of
an Adobe Portable Document Format file (also known as an “PDF” file) shall be
effective as delivery of a manually executed counterpart hereof. This Amendment
shall be construed and determined in accordance with the laws of the State of
New York (including Section 5-1401 and Section 5-1402 of the General Obligations
Law of the State of New York) without regard to conflicts of law principles that
would require application of the laws of another jurisdiction.

 

[Signature Pages to Follow]

 

-9-

 

 

 

This Third Amendment to Credit Agreement is entered into as of the date and year
first above written.

 

  “Borrower”           Trade Street Operating Partnership, LP,   a Delaware
limited partnership           By: Trade Street OP GP, LLC,       a Delaware
limited liability company,       its general partner               By: Trade
Street Residential, Inc., a Maryland        corporation, its sole member        
                By: /s/ Richard Ross       Name: Richard Ross       Title: Chief
Financial Officer  

 

 

[Signature Page to Third Amendment to Credit Agreement]

 

 

 

 

  “Administrative Agent”           BMO Harris Bank N.A., as Administrative Agent
                By: /s/ Kim Liautaud       Name: Kim Liautaud       Title:
Director                                   “Lender”            BMO Harris Bank
N.A., as a Lender and Swing Line Lender                         By: /s/ Kim
Liautaud       Name: Kim Liautaud       Title: Director  

 

 

[Signature Page to Third Amendment to Credit Agreement]

 

 

 

 

  “Guarantors”           Trade Street Residential, Inc.,     a Maryland
corporation                 By:       Name:       Title:                        
          BSF-Arbors River Oaks, LLC,     a Florida limited liability company  
         By: TS Manager, LLC, a Florida limited       liability company, its
manager                     By:       Name:       Title:  

 

 

[Signature Page to Third Amendment to Credit Agreement]

 

 

 

 

Schedule I

to Compliance Certificate

_________________________________________________

 

Compliance Calculations

for Credit Agreement dated as of January 31, 2013

 

Calculations as of _____________, _______

 

 

A.            Maximum Total Indebtedness to Total Asset Value Ratio
(Section 8.20(a))   1.         Total Indebtedness $___________ 2.         Total
Asset Value as calculated on Exhibit A hereto ___________ 3.         Ratio of
Line A1 to A2 ____:1.00 4.         Line A3 must not exceed

0.70:1.00 (through December 31, 2014)

0.65:1.00 (after December 31, 2014)

5.         The Borrower is in compliance (circle yes or no) yes/no B.
           Minimum Adjusted EBITDA to Fixed Charges Ratio (Section 8.20(b))   1.
        Net Income $___________ 2.         Depreciation and amortization expense
___________ 3.         Interest Expense ___________ 4.         Income tax
expense ___________ 5.         Extraordinary, unrealized or non-recurring losses
___________ 6.         Extraordinary, unrealized or non-recurring gains
___________ 7.         Income tax benefits ___________ 8.         Sum of Lines
B1, B2, B3, B4 and B5 ___________ 9.         Sum of Lines B6 and B7 ___________
10.       Line B8 minus Line B9 (“EBITDA”) ___________ 11.       Annual Capital
Expenditure Reserve   12.       Line B10 minus Line B11 (“Adjusted EBITDA”)  

 

 

 

 

13.       Interest Expense ___________ 14.       Principal Amortization Payments
___________ 15.       Dividends ___________ 16.       Income Taxes Paid
___________ 17.       Sum of Lines B13, B14, B15 and B16 (“Fixed Charges”)
___________ 18.       Ratio of Line B12 to Line B17 ____:1.00 19.       Line B18
shall not be less than

1.15:1.00
(December 31, 2012 through
December 31, 2014)

1.25:1.00
(March 31, 2015 through September 30, 2015)

1.50:1.00
(December 31, 2015 and thereafter)

20.       The Borrower is in compliance (circle yes or no) yes/no C.
          Tangible Net Worth (Section 8.20(c))   1.         Tangible Net Worth
$___________ 2.         Aggregate net proceeds of Stock and Stock Equivalent
offerings ___________ 3.         75% of Line C2 ___________ 4.
        $26,954,678.00 plus Line C3 ___________ 5.         Line C1 shall not be
less than Line C4   6.         The Borrower is in compliance (circle yes or no)
yes/no D.            Investments - Joint Ventures (Section 8.8(i))   1.
        Cash Investments in Joint Ventures $___________ 2.         Total Asset
Value ___________ 3.         Line D1 divided by Line D2 ___________ 4.        
Line D3 shall not exceed 15% of Total Asset Value   5.         The Borrower is
in compliance (circle yes or no) yes/no

 

 

 

 

E.             Investments - Assets Under Development (Section 8.8(j))   1.
        Assets Under Development $___________ 2.         Total Asset Value
___________ 3.         Line E1 divided by Line E2 ___________ 4.         Line E3
shall not exceed 15% of Total Asset Value   5.         The Borrower is in
compliance (circle yes or no) yes/no F.             Investments - Mortgage
Loans, Mezzanine Loans and Notes Receivable (Section 8.8(k))   1.
        Mortgage Loans, Mezzanine Loans and Notes Receivable $___________
2.         Total Asset Value ___________ 3.         Line F1 divided by Line F2
___________ 4.         Line F3 shall not exceed 5% of Total Asset Value   5.
        The Borrower is in compliance (circle yes or no) yes/no G.           
Investments - Land Assets (Section 8.8(l))   1.         Land Assets $___________
2.         Total Asset Value ___________ 3.         Line G1 divided by Line G2
___________ 4.         Line G3 shall not exceed 17.5% of Total Asset Value   5.
        The Borrower is in compliance (circle yes or no) yes/no H.           
Aggregate Investment Limitation to Total Asset Value (Section 8.8)   1.
        Sum of Lines D1, E1, F1 and G1 $___________ 2.         Total Asset Value
____________ 3.         Line H1 divided by Line H2 ___________ 4.         Line
H3 shall not exceed 30% of Total Asset Value   5.         The Borrower is in
compliance (circle yes or no) yes/no

 

 

 

 

Exhibit H

 

Borrowing Base Certificate

 

To:BMO Harris Bank N.A., as Administrative Agent under, and the Lenders party
to, the Credit Agreement described below.

 

Pursuant to the terms of the Credit Agreement dated as of January 31, 2013,
among us (the “Credit Agreement”), we submit this Borrowing Base Certificate to
you and certify that the calculation of the Borrowing Base set forth below and
on any Exhibits to this Certificate is true, correct and complete as of the
Borrowing Base Determination Date.

 

A.     Borrowing Base Determination Date: __________________ ____, 20___.

 

B.      The Borrowing Base and Revolving Credit Availability as of the Borrowing
Base Determination Date is calculated as:

 

  1.       Borrowing Base Value as calculated on Exhibit A hereto
$_________________   2.       The Product of Line 1 and 75% (or 65% after
December 31, 2014) $_________________   3.       Debt Service Coverage Amount of
all Stabilized Properties as calculated on Exhibit B hereto $_________________
  4.       Interest Expense Coverage Amount of all Pre-stabilized Properties as
calculated on Exhibit B hereto $_________________   5.       Sum of Line 3 and
Line 4 $_________________   6.       The lesser of Line 2 and Line 5 (the
“Borrowing Base”) (Line 6 not to exceed Revolving Credit Commitment)
$_________________   7.       Aggregate Revolving Loans and Swing Loans
$_________________   8.       Line 6 minus Line 7 (the “Revolving Credit
Availability”)

 

 

$_________________

 

 

 

 

 

The foregoing certifications, together with the computations set forth in
Schedule I hereto are made and delivered this ______ day of __________________
20___.

 

  Trade Street Operating Partnership, LP,           By: Trade Street OP GP, LLC,
      its general partner               By: Trade Street Residential, Inc., a
Maryland        corporation, its sole member                         By:      
Name:       Title:  

  

 

 

 

Exhibit A to Borrowing Base Certificate

of Trade Street Operating Partnership, LP

 

This Exhibit A is attached to the Borrowing Base Certificate of Trade Street
Operating Partnership, LP for the Borrower Base Determination Date of
___________ ____, 20___ and delivered to BMO Harris Bank N.A., as Administrative
Agent, and the Lenders party to the Credit Agreement referred to therein. The
undersigned hereby certifies that the following is a true, correct and complete
calculation of Borrowing Base Value as of the Borrowing Base Determination Date
set forth above:

 

[Attach Schedule with exclusions for concentration limit]

 

Borrowing Base Value of all Eligible Properties: $__________

 

Borrowing Base Requirements:

 

A.            Number of Properties   1.       The number of Eligible Properties
___________ 2.       Line A1 shall not be less than 4 after June 30, 2015   3.
      The Borrower is in compliance (circle yes or no) yes/no B.
            Borrowing Base Value   1.       Borrowing Base Value $___________ 2.
      Line B1 shall not be less than $75,000,000 after June 30, 2015   3.
      The Borrower is in compliance (circle yes or no) yes/no C.            
Individual Eligible Property Value   1.       The Percentage of Borrowing Base
Value of each Eligible Property is set forth on the attached Schedule and the
Borrowing Base Value for any Eligible Property is set forth on the attached
Schedule.   2.       No Eligible Property comprises more than 35% of Borrowing
Base Value after June 30, 2015   3.       The Borrower is in compliance (circle
yes or no) yes/no

 

 

 

 

Schedule to Exhibit A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Exhibit B to Borrowing Base Certificate

of Trade Street Operating Partnership, LP

 

This Exhibit B is attached to the Borrowing Base Certificate of Trade Street
Operating Partnership, LP, for the Borrowing Base Determination Date of
__________ ___, 20__ and delivered to BMO Harris Bank N.A., as Administrative
Agent, and the Lenders party to the Credit Agreement referred to therein. The
undersigned hereby certifies that the following is a true, correct and complete
calculation of Debt Service Coverage Amount of all Stabilized Properties and
Interest Expense Coverage Amount of all Pre-stabilized Properties as of the
Borrowing Base Determination Date set forth above:

 

Stabilized Properties

Debt Service Coverage Amount

as Calculated on Annex I to this Exhibit B

  $__________   $__________   $__________   $__________

 

 

Pre-stabilized Properties Interest Expense Coverage Amount as Calculated on
Annex I to this Exhibit B   $__________   $__________   $__________  
$__________

 

Total Debt Service Coverage Amount and Interest Expense Coverage Amount of all
Eligible Properties: $__________

 

 

 

 

Annex I to Exhibit B to Borrowing Base Certificate

of Trade Street Operating Partnership, LP

 

[Borrower to Insert Calculation of Debt Service Coverage Amount and Interest
Expense Coverage Amount for each Eligible Property with concentration limit
exclusions]