Amended and Restated Credit Agreement

 

Dated as of March 28, 2017

 

among

 

UMH Properties, Inc.,

 

The Guarantors From Time to Time Parties Hereto,

 

the Lenders from time to time parties hereto,

 

and

 

Bank of Montreal,

as Administrative Agent

 

 

 

BMO Capital Markets Corp., as Sole Lead Arranger and Sole Book Runner

 

 

 

 

Table of Contents

 

SECTION HEADING PAGE       SECTION 1. THE CREDIT FACILITY 2       Section 1.1.
Commitments 2 Section 1.2. Reserved 2 Section 1.3. Letters of Credit 2 Section
1.4. Applicable Interest Rates 6 Section 1.5. Minimum Borrowing Amounts; Maximum
Eurodollar Loans 7 Section 1.6. Manner of Borrowing Loans and Designating
Applicable Interest Rates 7 Section 1.7. Maturity of Loans 9 Section 1.8.
Prepayments 9 Section 1.9. Default Rate 10 Section 1.10. Evidence of
Indebtedness 11 Section 1.11. Funding Indemnity 12 Section 1.12. Commitment
Terminations 12 Section 1.13. Substitution of Lenders 12 Section 1.14.
Defaulting Lenders 13 Section 1.15. Increase in Commitments 15 Section 1.16.
Extension of Termination Date 16       SECTION 2. FEES 17       Section 2.1.
Fees 17       SECTION 3. PLACE AND APPLICATION OF PAYMENTS 17       Section 3.1.
Place and Application of Payments 17 Section 3.2. Account Debit 19       SECTION
4. GUARANTIES 19       Section 4.1. Guaranties 19 Section 4.2. Further
Assurances 19 Section 4.3. Depository Bank 19       SECTION 5. DEFINITIONS;
INTERPRETATION 20       Section 5.1. Definitions 20 Section 5.2. Interpretation
42 Section 5.3. Change in Accounting Principles 43 Section 5.4. Divisions 43

 

 

 

 

SECTION 6. REPRESENTATIONS AND WARRANTIES 43       Section 6.1. Organization and
Qualification 43 Section 6.2. Subsidiaries 43 Section 6.3. Authority and
Validity of Obligations 44 Section 6.4. Use of Proceeds; Margin Stock 44 Section
6.5. Financial Reports 45 Section 6.6. No Material Adverse Change 45 Section
6.7. Full Disclosure 45 Section 6.8. Trademarks, Franchises, and Licenses 45
Section 6.9. Governmental Authority and Licensing 45 Section 6.10. Good Title 46
Section 6.11. Litigation and Other Controversies 46 Section 6.12. Taxes 46
Section 6.13. Approvals 46 Section 6.14. Affiliate Transactions 46 Section 6.15.
Investment Company 47 Section 6.16. ERISA 47 Section 6.17. Compliance with Laws
47 Section 6.18. OFAC 48 Section 6.19. Other Agreements 48 Section 6.20.
Solvency 48 Section 6.21. No Default 48 Section 6.22. No Broker Fees. 49 Section
6.23. Condition of Property; Casualties; Condemnation 49       SECTION 7.
CONDITIONS PRECEDENT 49       Section 7.1. All Credit Events 49 Section 7.2.
Initial Credit Event 50 Section 7.3. Eligible Property Additions and Deletions
to the Borrowing Base 52       SECTION 8. COVENANTS 53       Section 8.1.
Maintenance of Existence 53 Section 8.2. Maintenance of Properties 53 Section
8.3. Taxes and Assessments 54 Section 8.4. Insurance 54 Section 8.5. Financial
Reports 54 Section 8.6. Inspection 57 Section 8.7. Liens 57 Section 8.8.
Investments, Acquisitions, Loans and Advances 57 Section 8.9. Mergers,
Consolidations and Sales 59 Section 8.10. Maintenance of Subsidiaries 60 Section
8.11. ERISA 60 Section 8.12. Compliance with Laws 60 Section 8.13. Compliance
with OFAC Sanctions Programs and Anti-Corruption Laws 61

 

 

 

 

Section 8.14. Burdensome Contracts With Affiliates 62 Section 8.15. No Changes
in Fiscal Year 63 Section 8.16. Formation of Subsidiaries 63 Section 8.17.
Change in the Nature of Business 63 Section 8.18. Use of Proceeds 63 Section
8.19. No Restrictions 63 Section 8.20. Financial Covenants 63 Section 8.21.
Electronic Delivery of Certain Information 64       SECTION 9. EVENTS OF DEFAULT
AND REMEDIES 65       Section 9.1. Events of Default 65 Section 9.2. Non
Bankruptcy Defaults 67 Section 9.3. Bankruptcy Defaults 67 Section 9.4.
Collateral for Undrawn Letters of Credit 68 Section 9.5. Notice of Default 69  
    SECTION 10. CHANGE IN CIRCUMSTANCES 69       Section 10.1. Change of Law 69
Section 10.2. Unavailability of Deposits or Inability to Ascertain, or
Inadequacy of, LIBOR 70 Section 10.3. Increased Cost and Reduced Return 71
Section 10.4. Lending Offices 72 Section 10.5. Discretion of Lender as to Manner
of Funding 72       SECTION 11. THE ADMINISTRATIVE AGENT 73       Section 11.1.
Appointment and Authorization of Administrative Agent 73 Section 11.2.
Administrative Agent and its Affiliates 73 Section 11.3. Action by
Administrative Agent 73 Section 11.4. Consultation with Experts 74 Section 11.5.
Liability of Administrative Agent; Credit Decision 74 Section 11.6. Indemnity 74
Section 11.7. Resignation of Administrative Agent and Successor Administrative
Agent 75 Section 11.8. L/C Issuer. 75 Section 11.9. Hedging Liability and Bank
Product Obligations 76 Section 11.10. Designation of Additional Agents 76      
SECTION 12. MISCELLANEOUS 76       Section 12.1. Taxes 76 Section 12.2. Other
Taxes 80 Section 12.3. No Waiver, Cumulative Remedies 80 Section 12.4. Non
Business Days 80 Section 12.5. Survival of Representations 80 Section 12.6.
Survival of Indemnities 81

 

 

 

 

Section 12.7. Sharing of Set Off 81 Section 12.8. Notices 81 Section 12.9.
Counterparts; Integration; Effectiveness. 82 Section 12.10. Successors and
Assigns 83 Section 12.11. Participants 83 Section 12.12. Assignments 83 Section
12.13. Amendments 86 Section 12.14. Headings 87 Section 12.15. Costs and
Expenses; Indemnification 87 Section 12.16. Set off 88 Section 12.17. Entire
Agreement 89 Section 12.18. Waiver of Jury Trial 89 Section 12.19. Severability
of Provisions 89 Section 12.20. Excess Interest 89 Section 12.21. Construction
90 Section 12.22. Lender’s and L/C Issuer’s Obligations Several 90 Section
12.23. Governing Law; Jurisdiction; Consent to Service of Process 90 Section
12.24. USA Patriot Act 91 Section 12.25. Confidentiality 91 Section 12.26.
Limitation of Recourse 92 Section 12.27. Amendment and Restatement 92 Section
12.28. Equalization of Loans and Commitments 92 Section 12.29. Acknowledgement
and Consent to Bail-In of EEA Financial Institutions 93       SECTION 13. THE
GUARANTEES 93       Section 13.1. The Guarantees 93 Section 13.2. Guarantee
Unconditional 94 Section 13.3. Discharge Only upon Payment in Full;
Reinstatement in Certain Circumstances 95 Section 13.4. Subrogation 95 Section
13.5. Waivers 95 Section 13.6. Limit on Recovery 95 Section 13.7. Stay of
Acceleration 96 Section 13.8. Benefit to Guarantors 96 Section 13.9. Guarantor
Covenants 96 Section 13.10. Keepwell 96 Section 13.11. Subordination 96      
Signature Page 1

 

EXHIBIT A — Notice of Payment Request EXHIBIT B — Notice of Borrowing EXHIBIT C
— Notice of Continuation/Conversion

 

 

 

 

EXHIBIT D — Revolving Note EXHIBIT E — Compliance Certificate EXHIBIT F —
Assignment and Acceptance EXHIBIT G — Additional Guarantor Supplement EXHIBIT H
— Commitment Amount Increase Request EXHIBIT I — Borrowing Base Certificate
EXHIBIT J-1 — Form of U.S. Tax Compliance Certificate EXHIBIT J-2 — Form of U.S.
Tax Compliance Certificate EXHIBIT J-3 — Form of U.S. Tax Compliance Certificate
EXHIBIT J-4 — Form of U.S. Tax Compliance Certificate       SCHEDULE 1.1 —
Commitments SCHEDULE 1.2 — Initial Borrowing Base Properties SCHEDULE 6.2 —
Subsidiaries

 

 

 

 

Amended and Restated Credit Agreement

 

This Amended and Restated Credit Agreement (this “Agreement”) is entered into as
of March 28, 2017, by and among UMH Properties, Inc., a Maryland corporation,
operating as a qualified real estate investment trust under Sections 856 through
860 of the Code (the “Borrower”), the Guarantors from time to time party to this
Agreement, the several financial institutions from time to time party to this
Agreement, as Lenders, and Bank of Montreal, a Canadian chartered bank acting
through its Chicago branch, as Administrative Agent as provided herein. All
capitalized terms used herein without definition shall have the same meanings
herein as such terms are defined in Section 5.1 hereof.

 

Preliminary Statement

 

A. The Borrower, the lenders party thereto (the “Existing Lenders”), the
Guarantors party thereto, and the Administrative Agent previously entered into a
Credit Agreement dated as of March 29, 2013 (as heretofore amended or otherwise
modified, the “Existing Credit Agreement”). Pursuant to the Existing Credit
Agreement, the Administrative Agent and the Existing Lenders agreed, among other
things, to extend a $35,000,000 revolving credit facility to the Borrower.

 

B. The Borrower has requested that (i) the maturity date under the Existing
Credit Agreement be extended, (ii) the amount of the revolving credit facility
available under the Existing Credit Agreement be increased, (iii) certain other
amendments be made to the Existing Credit Agreement, and (iv) for the sake of
clarity and convenience, the Existing Credit Agreement be restated in its
entirety as so amended, and the Administrative Agent and the Lenders have agreed
to such requests on the terms and conditions set forth in this Agreement.

 

C. This Agreement amends and restates the Existing Credit Agreement in its
entirety and from and after the date of this Agreement, all references to the
Existing Credit Agreement in any Loan Document or in any other instrument or
document shall, without more, be deemed to refer to this Agreement. This
Agreement shall become effective as of the date hereof, and supercede all
provisions of the Existing Credit Agreement as of such date, upon the execution
of this Agreement by each of the parties hereto and fulfillment of the
conditions precedent contained in Section 7.2 hereof.

 

D. This Agreement shall constitute for all purposes an amendment to the Existing
Credit Agreement and not a new or substitute agreement.

 

 

 

 

Now, Therefore, in consideration of the mutual agreements contained herein, and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

 

Section 1. The Credit Facility.

 

Section 1.1. Commitments. Subject to the terms and conditions hereof, each
Lender, by its acceptance hereof, severally agrees to make a loan or loans
(individually a “Loan” and collectively for all the Lenders the “Loans”) in U.S.
Dollars to the Borrower from time to time on a revolving basis up to the amount
of such Lender’s Commitment, subject to any reductions thereof pursuant to the
terms hereof, before the Termination Date. The sum of the aggregate principal
amount of Loans and L/C Obligations at any time outstanding shall not exceed the
lesser of (i) the Commitments of all Lenders in effect at such time and (ii) the
Borrowing Base as then determined and computed. Each Borrowing of Loans shall be
made ratably by the Lenders in proportion to their respective Percentages. As
provided in Section 1.6(a) hereof, the Borrower may elect that each Borrowing of
Loans be either Base Rate Loans or Eurodollar Loans. Loans may be repaid and the
principal amount thereof reborrowed before the Termination Date, subject to the
terms and conditions hereof.

 

Section 1.2. Reserved.

 

Section 1.3. Letters of Credit. (a) General Terms. Subject to the terms and
conditions hereof, as part of the Revolving Credit, the L/C Issuer shall issue
standby and commercial letters of credit (each a “Letter of Credit”) for the
account of the Borrower or any one or more of its Subsidiaries in an aggregate
undrawn face amount up to the L/C Sublimit. Each Letter of Credit shall be
issued by the L/C Issuer, but each Lender shall be obligated to reimburse the
L/C Issuer for such Lender’s Percentage of the amount of each drawing thereunder
and, accordingly, each Letter of Credit shall constitute usage of the Commitment
of each Lender pro rata in an amount equal to its Percentage of the
L/C Obligations then outstanding.

 

(b) Applications. At any time before the Termination Date, the L/C Issuer shall,
at the request of the Borrower, issue one or more Letters of Credit in U.S.
Dollars, in a form reasonably satisfactory to the L/C Issuer, with expiration
dates no later than the earlier of 12 months from the date of issuance (or which
are cancelable not later than 12 months from the date of issuance) or thirty
(30) days prior to the Termination Date (subject to the sentence below in
respect of Letters of Credit with expiration dates that are automatically
extended), in an aggregate face amount up to the L/C Sublimit, upon the receipt
of an application duly executed by the Borrower for the relevant Letter of
Credit in the form then customarily prescribed by the L/C Issuer for the Letter
of Credit requested (each an “Application”). Notwithstanding anything contained
in any Application to the contrary: (i) the Borrower shall pay fees in
connection with each Letter of Credit as set forth in Section 2.1 hereof,
(ii) except as otherwise provided in Section 1.8 or Section 1.14 hereof, unless
an Event of Default is then continuing, the L/C Issuer will not call for the
funding by the Borrower of any amount under a Letter of Credit before being
presented with a drawing thereunder, and (iii) if the L/C Issuer is not timely
reimbursed for the amount of any drawing under a Letter of Credit on the date
such drawing is paid, unless a Loan shall be made on such date in the amount of
the Reimbursement Obligations and the proceeds thereof applied to pay such
Reimbursement Obligations as contemplated by the last sentence of Section 1.3(c)
hereof, the Borrower’s obligation to reimburse the L/C Issuer for the amount of
such drawing shall bear interest (which the Borrower hereby promises to pay)
from and after the date such drawing is paid at a rate per annum equal to the
sum of the Applicable Margin plus the Base Rate from time to time in effect
(computed on the basis of a year of 365 or 366 days, as the case may be, and the
actual number of days elapsed). If the L/C Issuer issues any Letter of Credit
with an expiration date that is automatically extended unless the L/C Issuer
gives notice that the expiration date will not so extend beyond its then
scheduled expiration date, then the L/C Issuer will give such notice of
non-renewal before the time necessary to prevent such automatic extension if
before such required notice date: (i) the expiration date of such Letter of
Credit if so extended would be after the date that is thirty (30) days prior to
the Termination Date, (ii) the Commitments have been terminated, or (iii) a
Default or an Event of Default is then continuing and either the Administrative
Agent or the Required Lenders (with notice to the Administrative Agent) have
given the L/C Issuer instructions not to so permit the extension of the
expiration date of such Letter of Credit. The L/C Issuer agrees to issue
amendments to the Letter(s) of Credit increasing the amount, or extending the
expiration date, thereof at the request of the Borrower subject to the
conditions of Section 7 hereof and the other terms of this Section 1.3.

 

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(c) The Reimbursement Obligations. Upon receipt from the beneficiary of any
Letter of Credit of any notice of a drawing under such Letter of Credit, the L/C
Issuer shall promptly notify the Borrower and the Administrative Agent thereof.
Subject to Sections 1.3(b) and 1.6(c) hereof, the obligation of the Borrower to
reimburse the L/C Issuer for all drawings under a Letter of Credit (a
“Reimbursement Obligation”) shall be governed by the Application related to such
Letter of Credit, except that reimbursement shall be made by no later than
1:00 p.m. (Chicago time) on the date when each drawing is to be paid if the
Borrower has been informed of such drawing by the L/C Issuer on or before
11:00 a.m. (Chicago time) on the date when such drawing is to be paid or, if
notice of such drawing is given to the Borrower after 11:00 a.m. (Chicago time)
on the date when such drawing is to be paid, by no later than 12:00 Noon
(Chicago time) on the following Business Day, in immediately available funds at
the Administrative Agent’s principal office in Chicago, Illinois or such other
office as the Administrative Agent may designate in writing to the Borrower (who
shall thereafter cause to be distributed to the L/C Issuer such amount(s) in
like funds). If the Borrower does not make any such reimbursement payment on the
date due and the Participating Lenders fund their participations therein in the
manner set forth in Section 1.3(e) below, then all payments thereafter received
by the Administrative Agent in discharge of any of the relevant Reimbursement
Obligations shall be distributed in accordance with Section 1.3(e) below.

 

(d) Obligations Absolute. The Borrower's obligation to reimburse L/C Obligations
as provided in subsection (c) of this Section shall be absolute, unconditional
and irrevocable, and shall be performed strictly in accordance with the terms of
this Agreement and the relevant Application under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit or this Agreement, or any term or provision therein, (ii) any
draft or other document presented under a Letter of Credit proving to be forged,
fraudulent or invalid in any respect or any statement therein being untrue or
inaccurate in any respect, (iii) payment by the L/C Issuer under a Letter of
Credit against presentation of a draft or other document that does not strictly
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 1.3, constitute a legal or
equitable discharge of, or provide a right of setoff against, the Borrower’s
obligations hereunder, except, in each case, to the extent of any direct damages
(as opposed to consequential damages, claims in respect of which are hereby
waived by the Borrower to the extent permitted by applicable Legal Requirements)
suffered by the Borrower that are caused by the L/C Issuer’s gross negligence or
willful misconduct on the part of the L/C Issuer (as finally determined by a
court of competent jurisdiction). None of the Administrative Agent, the Lenders,
or the L/C Issuer shall have any liability or responsibility by reason of or in
connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the
circumstances referred to in the preceding sentence), or any error, omission,
interruption, loss or delay in transmission or delivery of any draft, notice or
other communication under or relating to any Letter of Credit (including any
document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the
L/C Issuer; provided that the foregoing shall not be construed to excuse the L/C
Issuer from liability to the Borrower to the extent of any direct damages (as
opposed to consequential damages, claims in respect of which are hereby waived
by the Borrower to the extent permitted by applicable Legal Requirements)
suffered by the Borrower that are caused by the L/C Issuer’s failure to exercise
care when determining whether drafts and other documents presented under a
Letter of Credit comply with the terms thereof. The parties hereto expressly
agree that, in the absence of gross negligence or willful misconduct on the part
of the L/C Issuer (as determined by a court of competent jurisdiction by final
and non-appealable judgment), the L/C Issuer 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 L/C Issuer 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.

 

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(e) The Participating Interests. Each Lender (other than the Lender acting as
L/C Issuer in issuing the relevant Letter of Credit), by its acceptance hereof,
severally agrees to purchase from the L/C Issuer, and the L/C Issuer hereby
agrees to sell to each such Lender (a “Participating Lender”), an undivided
percentage participating interest (a “Participating Interest”), to the extent of
its Percentage, in each Letter of Credit issued by, and each Reimbursement
Obligation owed to, the L/C Issuer. Upon any failure by the Borrower to pay any
Reimbursement Obligation at the time required on the date the related drawing is
to be paid, as set forth in Section 1.3(c) above, or if the L/C Issuer is
required at any time to return to the Borrower or to a trustee, receiver,
liquidator, custodian or other Person any portion of any payment of any
Reimbursement Obligation, each Participating Lender shall, not later than the
Business Day it receives a certificate in the form of Exhibit A hereto from the
L/C Issuer (with a copy to the Administrative Agent) to such effect, if such
certificate is received before 1:00 p.m. (Chicago time), or not later than 1:00
p.m. (Chicago time) the following Business Day, if such certificate is received
after such time, pay to the Administrative Agent for the account of the L/C
Issuer an amount equal to such Participating Lender’s Percentage of such unpaid
or recaptured Reimbursement Obligation together with interest on such amount
accrued from the date the related payment was made by the L/C Issuer to the date
of such payment by such Participating Lender at a rate per annum equal to: (i)
from the date the related payment was made by the L/C Issuer to the date two (2)
Business Days after payment by such Participating Lender is due hereunder, the
greater of the Federal Funds Rate and a rate determined by the Administrative
Agent in accordance with industry rules on interbank compensation for each such
day and (ii) from the date two (2) Business Days after the date such payment is
due from such Participating Lender to the date such payment is made by such
Participating Lender, the Base Rate in effect for each such day. Each such
Participating Lender shall thereafter be entitled to receive its Percentage of
each payment received in respect of the relevant Reimbursement Obligation and of
interest paid thereon, with the L/C Issuer retaining its Percentage thereof as a
Lender hereunder. The several obligations of the Participating Lenders to the
L/C Issuer under this Section 1.3 shall be absolute, irrevocable, and
unconditional under any and all circumstances whatsoever and shall not be
subject to any set-off, counterclaim or defense to payment which any
Participating Lender may have or have had against the Borrower, the L/C Issuer,
the Administrative Agent, any Lender or any other Person whatsoever. Without
limiting the generality of the foregoing, such obligations shall not be affected
by any Default or Event of Default or by any reduction or termination of any
Commitment of any Lender, and each payment by a Participating Lender under this
Section 1.3 shall be made without any offset, abatement, withholding or
reduction whatsoever.

 

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(f) Indemnification. The Participating Lenders shall, to the extent of their
respective Percentages, indemnify the L/C Issuer (to the extent not reimbursed
by the Borrower) against any cost, expense (including reasonable counsel fees
and disbursements), claim, demand, action, loss or liability (except such as
result from such L/C Issuer’s gross negligence or willful misconduct as
determined by a court of competent jurisdiction by final and non-appealable
judgment) that the L/C Issuer may suffer or incur in connection with any Letter
of Credit issued by it. The obligations of the Participating Lenders under this
Section 1.3(f) and all other parts of this Section 1.3 shall survive termination
of this Agreement and of all Applications, Letters of Credit, and all drafts and
other documents presented in connection with drawings thereunder.

 

(g) Manner of Requesting a Letter of Credit. The Borrower shall provide at least
five (5) Business Days’ advance written notice to the Administrative Agent of
each request for the issuance of a Letter of Credit, such notice in each case to
be accompanied by an Application for such Letter of Credit properly completed
and executed by the Borrower and, in the case of an extension or amendment or an
increase in the amount of a Letter of Credit, a written request therefor, in a
form reasonably acceptable to the Administrative Agent and the L/C Issuer, in
each case, together with the fees called for by this Agreement. The
Administrative Agent shall promptly notify the L/C Issuer of the Administrative
Agent’s receipt of each such notice (and the L/C Issuer shall be entitled to
assume that the conditions precedent to any such issuance, extension, amendment
or increase have been satisfied unless notified to the contrary by the
Administrative Agent or the Required Lenders) and the L/C Issuer shall promptly
notify the Administrative Agent and the Lenders of the issuance of the Letter of
Credit so requested.

 

(h) Replacement of the L/C Issuer. The L/C Issuer may be replaced at any time by
written agreement among the Borrower, the Administrative Agent, the replaced
L/C Issuer and the successor L/C Issuer. The Administrative Agent shall notify
the Lenders of any such replacement of the L/C Issuer. At the time any such
replacement shall become effective, the Borrower shall pay all unpaid fees
accrued for the account of the replaced L/C Issuer. From and after the effective
date of any such replacement (i) the successor L/C Issuer shall have all the
rights and obligations of the L/C Issuer under this Agreement with respect to
Letters of Credit to be issued thereafter and (ii) references herein to the term
“L/C Issuer” shall be deemed to refer to such successor or to any previous
L/C Issuer, or to such successor and all previous L/C Issuers, as the context
shall require. After the replacement of a L/C Issuer hereunder, the replaced
L/C Issuer shall remain a party hereto and shall continue to have all the rights
and obligations of a L/C Issuer under this Agreement with respect to Letters of
Credit issued by it prior to such replacement, but shall not be required to
issue additional Letters of Credit.

 

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Section 1.4. Applicable Interest Rates. (a) Base Rate Loans. Each Base Rate Loan
made or maintained by a Lender shall bear interest (computed on the basis of a
year of 365 or 366 days, as the case may be, and the actual days elapsed) on the
unpaid principal amount thereof from the date such Loan is advanced, or created
by conversion from a Eurodollar Loan, until maturity (whether by acceleration or
otherwise) at a rate per annum equal to the sum of the Applicable Margin plus
the Base Rate from time to time in effect, payable by the Borrower on each
Interest Payment Date and at maturity (whether by acceleration or otherwise).

 

“Base Rate” means, for any day, the rate per annum equal to the greatest of:
(a) the rate of interest announced or otherwise established by the
Administrative Agent from time to time as its prime commercial rate, or its
equivalent, for U.S. Dollar loans to borrowers located in the United States as
in effect on such day, with any change in the Base Rate resulting from a change
in said prime commercial rate to be effective as of the date of the relevant
change in said prime commercial rate (it being acknowledged and agreed that such
rate may not be the Administrative Agent’s best or lowest rate), (b) the sum of
(i) the Federal Funds Rate for such day, plus (ii) 1/2 of 1%, and (c) the LIBOR
Quoted Rate for such day plus 1.00%; provided that in no event shall the “Base
Rate” be less than 0.00%. As used herein, the term “LIBOR Quoted Rate” means,
for any day, the rate per annum equal to the quotient of (i) the rate per annum
(rounded upwards, if necessary, to the next higher one hundred-thousandth of a
percentage point) for deposits in U.S. Dollars for a one-month interest period
as reported on the applicable Bloomberg screen page (or such other commercially
available source providing such quotations as may be designated by the
Administrative Agent from time to time) as of 11:00 a.m. (London, England time)
on such day (or, if such day is not a Business Day, on the immediately preceding
Business Day) divided by (ii) one (1) minus the Eurodollar Reserve Percentage,
provided that in no event shall the “LIBOR Quoted Rate” be less than 0.00%.

 

(b) Eurodollar Loans. Each Eurodollar Loan made or maintained by a Lender shall
bear interest during each Interest Period it is outstanding (computed on the
basis of a year of 360 days and actual days elapsed) on the unpaid principal
amount thereof from the date such Loan is advanced or continued, or created by
conversion from a Base Rate Loan, until maturity (whether by acceleration or
otherwise) at a rate per annum equal to the sum of the Applicable Margin plus
the Adjusted LIBOR applicable for such Interest Period, payable by the Borrower
on each Interest Payment Date and at maturity (whether by acceleration or
otherwise).

 

“Adjusted LIBOR” means, for any Borrowing of Eurodollar Loans, a rate per annum
determined in accordance with the following formula:

 

Adjusted LIBOR = LIBOR   1 - Eurodollar Reserve Percentage

 

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“Eurodollar Reserve Percentage” means the maximum reserve percentage, expressed
as a decimal, at which reserves (including, without limitation, any emergency,
marginal, special, and supplemental reserves) are imposed by the Board of
Governors of the Federal Reserve System (or any successor) on “eurocurrency
liabilities”, as defined in such Board’s Regulation D (or any successor
thereto), subject to any amendments of such reserve requirement by such Board or
its successor, taking into account any transitional adjustments thereto. For
purposes of this definition, the relevant Loans shall be deemed to be
“eurocurrency liabilities” as defined in Regulation D without benefit or credit
for any prorations, exemptions or offsets under Regulation D. The Eurodollar
Reserve Percentage shall be adjusted automatically on and as of the effective
date of any change in any such reserve percentage.

 

“LIBOR” means, for an Interest Period for a Borrowing of Eurodollar Loans,
(a) the LIBOR Index Rate for such Interest Period, if such rate is available,
and (b) if the LIBOR Index Rate cannot be determined, the arithmetic average of
the rates of interest per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) at which deposits in U.S. Dollars in immediately available funds
are offered to the Administrative Agent at 11:00 a.m. (London, England time) two
(2) Business Days before the beginning of such Interest Period by three (3) or
more major banks in the interbank eurodollar market selected by the
Administrative Agent for delivery on the first day of and for a period equal to
such Interest Period and in an amount equal or comparable to the principal
amount of the Eurodollar Loan scheduled to be made as part of such Borrowing,
provided that in no event shall “LIBOR” be less than 0.00%.

 

“LIBOR Index Rate” means, for any Interest Period, the rate per annum (rounded
upwards, if necessary, to the next higher one hundred-thousandth of a percentage
point) for deposits in U.S. Dollars for a period equal to such Interest Period,
as reported on the applicable Bloomberg screen page (or such other commercially
available source providing such quotations as may be designated by the
Administrative Agent from time to time) as of 11:00 a.m. (London, England time)
on the day two (2) Business Days before the commencement of such Interest
Period.

 

(c) Rate Determinations. The Administrative Agent shall determine each interest
rate applicable to the Loans and the Reimbursement Obligations hereunder, and
its good faith determination thereof shall be conclusive and binding except in
the case of manifest error.

 

Section 1.5. Minimum Borrowing Amounts; Maximum Eurodollar Loans. Each Borrowing
of Base Rate Loans shall be in an amount not less than $100,000. Each Borrowing
of Eurodollar Loans advanced, continued or converted to a Eurodollar Loan shall
be in an amount equal to $500,000 or such greater amount which is an integral
multiple of $100,000. Without the Administrative Agent’s consent, there shall
not be more than five (5) Borrowings of Eurodollar Loans outstanding hereunder.

 

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Section 1.6. Manner of Borrowing Loans and Designating Applicable Interest
Rates. (a) Notice to the Administrative Agent. The Borrower shall give notice to
the Administrative Agent by no later than 12:00 noon (Chicago time): (i) at
least three (3) Business Days before the date on which the Borrower requests the
Lenders to advance a Borrowing of Eurodollar Loans and (ii) on the date the
Borrower requests the Lenders to advance a Borrowing of Base Rate Loans. The
Loans included in each Borrowing shall bear interest initially at the type of
rate specified in such notice of a new Borrowing. Thereafter, subject to the
terms and conditions hereof, the Borrower may from time to time elect to change
or continue the type of interest rate borne by each Borrowing or, subject to the
minimum amount requirement for each outstanding Borrowing set forth in
Section 1.5 hereof, a portion thereof, as follows: (i) if such Borrowing is of
Eurodollar Loans, on the last day of the Interest Period applicable thereto, the
Borrower may continue part or all of such Borrowing as Eurodollar Loans or
convert part or all of such Borrowing into Base Rate Loans or (ii) if such
Borrowing is of Base Rate Loans, on any Business Day, the Borrower may convert
all or part of such Borrowing into Eurodollar Loans for an Interest Period or
Interest Periods specified by the Borrower. The Borrower shall give all such
notices requesting the advance, continuation or conversion of a Borrowing to the
Administrative Agent by telephone, telecopy, or other telecommunication device
acceptable to the Administrative Agent (which notice shall be irrevocable once
given and, if by telephone, shall be promptly confirmed in writing),
substantially in the form attached hereto as Exhibit B (Notice of Borrowing) or
Exhibit C (Notice of Continuation/Conversion), as applicable, or in such other
form acceptable to the Administrative Agent. Notice of the continuation of a
Borrowing of Eurodollar Loans for an additional Interest Period or of the
conversion of part or all of a Borrowing of Base Rate Loans into Eurodollar
Loans must be given by no later than 12:00 noon (Chicago time) at least three
(3) Business Days before the date of the requested continuation or conversion.
All such notices concerning the advance, continuation or conversion of a
Borrowing shall specify the date of the requested advance, continuation or
conversion of a Borrowing (which shall be a Business Day), the amount of the
requested Borrowing to be advanced, continued or converted, the type of Loans to
comprise such new, continued or converted Borrowing and, if such Borrowing is to
be comprised of Eurodollar Loans, the Interest Period applicable thereto. No
Borrowing of Eurodollar Loans shall be advanced, continued, or created by
conversion if any Default or Event of Default is then continuing. The Borrower
agrees that the Administrative Agent may rely on any such telephonic, telecopy
or other telecommunication notice given by any person the Administrative Agent
in good faith believes is an Authorized Representative without the necessity of
independent investigation, and in the event any such notice by telephone
conflicts with any written confirmation such telephonic notice shall govern if
the Administrative Agent has acted in reliance thereon.

 

(b) Notice to the Lenders. The Administrative Agent shall give prompt
telephonic, telecopy or other telecommunication notice to each Lender of any
notice from the Borrower received pursuant to Section 1.6(a) above and, if such
notice requests the Lenders to make Eurodollar Loans, the Administrative Agent
shall give notice to the Borrower and each Lender by like means of the interest
rate applicable thereto promptly after the Administrative Agent has made such
determination.

 

(c) Borrower’s Failure to Notify. If the Borrower fails to give notice pursuant
to Section 1.6(a) above of the continuation or conversion of any outstanding
principal amount of a Borrowing of Eurodollar Loans before the last day of its
then current Interest Period within the period required by Section 1.6(a) and
such Borrowing is not prepaid in accordance with Section 1.8(a), such Borrowing
shall automatically be converted into a Borrowing of Base Rate Loans. In the
event the Borrower fails to give notice pursuant to Section 1.6(a) above of a
Borrowing equal to the amount of a Reimbursement Obligation and has not notified
the Administrative Agent by 12:00 noon (Chicago time) on the day such
Reimbursement Obligation becomes due that it intends to repay such Reimbursement
Obligation through funds not borrowed under this Agreement, the Borrower shall
be deemed to have requested a Borrowing of Base Rate Loans under the Revolving
Credit on such day in the amount of the Reimbursement Obligation then due, which
Borrowing shall be applied to pay the Reimbursement Obligation then due.

 

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(d) Disbursement of Loans. Not later than 1:00 p.m. (Chicago time) on the date
of any requested advance of a new Borrowing, subject to Section 7 hereof, each
Lender shall make available its Loan comprising part of such Borrowing in funds
immediately available at the principal office of the Administrative Agent in
Chicago, Illinois (or at such other location as the Administrative Agent shall
designate). The Administrative Agent shall make the proceeds of each new
Borrowing available to the Borrower on the date of such Borrowing as instructed
by the Borrower.

 

(e) Administrative Agent Reliance on Lender Funding. Unless the Administrative
Agent shall have been notified by a Lender prior to (or, in the case of a
Borrowing of Base Rate Loans, by 1:00 p.m. (Chicago time) on) the date on which
such Lender is scheduled to make payment to the Administrative Agent of the
proceeds of a Loan (which notice shall be effective upon receipt) that such
Lender does not intend to make such payment, the Administrative Agent may assume
that such Lender has made such payment when due and the Administrative Agent may
in reliance upon such assumption (but shall not be required to) make available
to the Borrower the proceeds of the Loan to be made by such Lender and, if any
Lender has not in fact made such payment to the Administrative Agent, such
Lender shall, on demand, pay to the Administrative Agent the amount made
available to the Borrower attributable to such Lender together with interest
thereon in respect of each day during the period commencing on the date such
amount was made available to the Borrower and ending on (but excluding) the date
such Lender pays such amount to the Administrative Agent at a rate per annum
equal to: (i) from the date the related advance was made by the Administrative
Agent to the date two (2) Business Days after payment by such Lender is due
hereunder, the greater of the Federal Funds Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank
compensation for each such day and (ii) from the date two (2) Business Days
after the date such payment is due from such Lender to the date such payment is
made by such Lender, the Base Rate in effect for each such day. If such amount
is not received from such Lender by the Administrative Agent immediately upon
demand, the Borrower will, on demand, repay to the Administrative Agent the
proceeds of the Loan attributable to such Lender with interest thereon at a rate
per annum equal to the interest rate applicable to the relevant Loan, but
without such payment being considered a payment or prepayment of a Loan under
Section 1.11 hereof so that the Borrower will have no liability under such
Section with respect to such payment.

 

Section 1.7. Maturity of Loans. Each Loan, including both the outstanding
principal balance thereof and any accrued but unpaid interest thereon, shall
mature and be due and payable by the Borrower on the Termination Date.

 

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Section 1.8. Prepayments. (a) Optional. The Borrower may prepay in whole or in
part (but, if in part, only in an amount not less than $50,000 and, in each
case, in an amount such that the minimum amount required for a Borrowing
pursuant to Section 1.5 hereof remains outstanding) any Borrowing (i) in the
case of a Borrowing of Eurodollar Loans, at any time upon three (3) Business
Days prior notice by the Borrower to the Administrative Agent or (ii) in the
case of a Borrowing of Base Rate Loans, upon notice delivered by the Borrower to
the Administrative Agent no later than 12:00 noon (Chicago time) on the date of
prepayment (or, in any case, such shorter period of time then agreed to by the
Administrative Agent), such prepayment to be made by the payment of the
principal amount to be prepaid and, in the case of any Eurodollar Loans, accrued
interest thereon to the date fixed for prepayment plus any amounts due the
Lenders under Section 1.11 hereof.

 

(b) Mandatory.

 

(i) If at any time the sum of the unpaid principal balance of the Loans and the
L/C Obligations then outstanding shall be in excess of the Borrowing Base as
determined and computed in the most recent Borrowing Base Certificate delivered
in accordance with Section 8.5(d) hereof, the Borrower shall, within three (3)
Business Days following delivery of such Borrowing Base Certificate and without
notice or demand, pay the amount of the excess to the Administrative Agent for
the account of the Lenders as a mandatory prepayment on such Obligations, with
each such prepayment first to be applied to the Loans until paid in full with
any remaining balance to be held by the Administrative Agent in the Collateral
Account as security for the Obligations owing with respect to the Letters of
Credit.

 

(ii) Unless the Borrower otherwise directs, prepayments of Loans under this
Section 1.8(b) shall be applied first to Borrowings of Base Rate Loans until
payment in full thereof with any balance applied to Borrowings of Eurodollar
Loans in the order in which their Interest Periods expire. Each prepayment of
Loans under this Section 1.8(b) shall be made by the payment of the principal
amount to be prepaid and, in the case of any Eurodollar Loans, accrued interest
thereon to the date of prepayment together with any amounts due the Lenders
under Section 1.11 hereof. Each prefunding of L/C Obligations shall be made in
accordance with Section 9.4 hereof.

 

(c) Borrowings. Any amount of Loans paid or prepaid before the Termination Date
may, subject to the terms and conditions of this Agreement, be borrowed, repaid
and borrowed again.

 

Section 1.9. Default Rate. Notwithstanding anything to the contrary contained
herein, while any Event of Default is continuing or after acceleration of the
Obligations as a result of an Event of Default, the Borrower shall pay interest
(after as well as before entry of judgment thereon to the extent permitted by
law) on the principal amount of all Loans and Reimbursement Obligations, letter
of credit fees and other amounts at a rate per annum equal to:

 

(a) for any Base Rate Loan, the sum of 3.0% plus the Applicable Margin plus the
Base Rate from time to time in effect;

 

(b) for any Eurodollar Loan, the sum of 3.0% plus the rate of interest in effect
thereon at the time of such default until the end of the Interest Period
applicable thereto and, thereafter, at a rate per annum equal to the sum of 3.0%
plus the Applicable Margin for Base Rate Loans plus the Base Rate from time to
time in effect;

 

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(c) for any Reimbursement Obligation, the sum of 3.0% plus the amounts due under
Section 1.3 with respect to interest on such Reimbursement Obligation;

 

(d) for any Letter of Credit, the sum of 3.0% plus the amounts due under this
Agreement with respect to interest on such Letter of Credit (for the avoidance
of doubt, this shall not affect the Borrower’s obligation to pay letter of
credit fee due under Section 2.1 with respect to such Letter of Credit); and

 

(e) for any other amount owing hereunder not covered by clauses (a) through (d)
above, the sum of 3.0% plus the Applicable Margin plus the Base Rate from time
to time in effect;

 

provided, however, that in the absence of an acceleration of the Obligations as
a result of an Event of Default, any adjustments pursuant to this Section 1.9
shall be made at the election of the Administrative Agent, acting at the request
or with the consent of the Required Lenders, with written notice to the
Borrower. Interest accruing pursuant to this Section 1.9 shall be paid on demand
of the Administrative Agent at the request or with the consent of the Required
Lenders.

 

Section 1.10. Evidence of Indebtedness. (a) Each Lender shall maintain in
accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Lender resulting from each Loan made by
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder.

 

(b) The Administrative Agent shall also maintain accounts in which it will
record (i) the amount of each Loan made hereunder, the type thereof and the
Interest Period with respect thereto, (ii) the amount of any principal or
interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative
Agent hereunder from the Borrower and each Lender’s share thereof.

 

(c) The entries maintained in the accounts maintained pursuant to paragraphs (a)
and (b) above shall be prima facie evidence of the existence and amounts of the
Obligations therein recorded; provided, however, that the failure of the
Administrative Agent or any Lender to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay
the Obligations in accordance with their terms.

 

(d) Any Lender may request that its Loans be evidenced by a promissory note or
notes in the forms of Exhibit D (each a “Note” and collectively, the “Notes”).
In such event, the Borrower shall prepare, execute and deliver to such Lender a
Note payable to such Lender or its registered assigns in the amount of its
Commitment. Thereafter, the Loans evidenced by such Note or Notes and interest
thereon shall at all times (including after any assignment pursuant to
Section 12.12) be represented by one or more Notes payable to the order of the
payee named therein or any assignee pursuant to Section 12.12, except to the
extent that any such Lender or assignee subsequently returns any such Note for
cancellation and requests that such Loans once again be evidenced as described
in subsections (a) and (b) above.

 

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Section 1.11. Funding Indemnity. If any Lender shall incur any loss, cost or
expense (including, without limitation, any loss, cost or expense incurred by
reason of the liquidation or re-employment of deposits or other funds acquired
by such Lender to fund or maintain any Eurodollar Loan or the relending or
reinvesting of such deposits or amounts paid or prepaid to such Lender) as a
result of:

 

(a) any payment, prepayment or conversion of a Eurodollar Loan on a date other
than the last day of its Interest Period,

 

(b) any failure (because of a failure to meet the conditions of Section 7 or
otherwise) by the Borrower to borrow or continue a Eurodollar Loan, or to
convert a Base Rate Loan into a Eurodollar Loan, on the date specified in a
notice given pursuant to Section 1.6(a) hereof,

 

(c) any failure by the Borrower to make any payment of principal on any
Eurodollar Loan when due (whether by acceleration or otherwise), or

 

(d) any acceleration of the maturity of a Eurodollar Loan as a result of the
occurrence of any Event of Default hereunder,

 

then, upon the demand of such Lender, the Borrower shall pay to such Lender such
amount as will reimburse such Lender for such loss, cost or expense. If any
Lender makes such a claim for compensation, it shall provide to the Borrower,
with a copy to the Administrative Agent, a certificate setting forth the amount
of such loss, cost or expense in reasonable detail (including an explanation of
the basis for and the computation of such loss, cost or expense) and the amounts
shown on such certificate shall be deemed prima facie correct.

 

Section 1.12. Commitment Terminations. (a) Optional Terminations. The Borrower
shall have the right at any time and from time to time, upon five (5) Business
Days prior written notice to the Administrative Agent (or such shorter period of
time agreed to by the Administrative Agent), to terminate the Commitments
without premium or penalty and in whole or in part, any partial termination to
be (i) in an amount not less than $1,000,000 and (ii) allocated ratably among
the Lenders in proportion to their respective Percentages, provided that the
Commitments may not be reduced to an amount less than the sum of the aggregate
principal amount of Loans and L/C Obligations then outstanding. Any termination
of the Commitments below the L/C Sublimit then in effect shall reduce the
L/C Sublimit by a like amount. The Administrative Agent shall give prompt notice
to each Lender of any such termination of the Commitments.

 

(b) Reinstatement. Any termination of the Commitments pursuant to this
Section 1.12 may not be reinstated.

 

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Section 1.13. Substitution of Lenders. In the event (a) the Borrower receives a
claim from any Lender for compensation under Section 10.3 or 12.1 hereof,
(b) the Borrower receives notice from any Lender of any illegality pursuant to
Section 10.1 hereof, (c) any Lender is then a Defaulting Lender, or (d) a Lender
fails to consent to an amendment or waiver requested under Section 12.13 hereof
at a time when the Required Lenders have approved such amendment or waiver (any
such Lender referred to in clause (a), (b), (c), or (d) above being hereinafter
referred to as an “Affected Lender”), the Borrower may, in addition to any other
rights the Borrower may have hereunder or under applicable Legal Requirements,
require, at its expense, any such Affected Lender to assign, at par, without
recourse, all of its interest, rights, and obligations hereunder (including all
of its Commitments and the Loans and participation interests in Letters of
Credit and other amounts at any time owing to it hereunder and the other Loan
Documents) to an Eligible Assignee specified by the Borrower, provided that
(i) such assignment shall not conflict with or violate any law, rule or
regulation or order of any court or other Governmental Authority, (ii) the
Borrower shall have paid to the Affected Lender all monies (together with
amounts due such Affected Lender under Section 1.11 hereof as if the Loans owing
to it were prepaid rather than assigned) other than such principal owing to it
hereunder, and (iii) the assignment is entered into in accordance with, and
subject to the consents required by, Section 12.12 hereof (provided any
assignment fees and reimbursable expenses due thereunder shall be paid by the
Borrower).

 

Section 1.14. Defaulting Lenders. (a) Defaulting Lender Adjustments.
Notwithstanding anything to the contrary contained in this Agreement, if any
Lender becomes a Defaulting Lender, then, until such time as such Lender is no
longer a Defaulting Lender, to the extent permitted by applicable Legal
Requirements:

 

(i) Waivers and Amendments. Such Defaulting Lender’s right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement shall
be restricted as set forth in Section 12.13 hereof.

 

(ii) Defaulting Lender Waterfall. Any payment of principal, interest, fees or
other amounts received by the Administrative Agent for the account of such
Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to
Section 9 or otherwise) or received by the Administrative Agent from a
Defaulting Lender pursuant to Section 12.7 hereto shall be applied at such time
or times as may be determined by the Administrative Agent as follows: first, to
the payment of any amounts owing by such Defaulting Lender to the Administrative
Agent hereunder; second, to the payment on a pro rata basis of any amounts owing
by such Defaulting Lender to any L/C Issuer hereunder; third, to Cash
Collateralize the L/C Issuer’s Fronting Exposure with respect to such Defaulting
Lender in accordance with Section 9.4; fourth, as the Borrower may request (so
long as no Default or Event of Default is then continuing), to the funding of
any Loan in respect of which such Defaulting Lender has failed to fund its
portion thereof as required by this Agreement, as determined by the
Administrative Agent; fifth, if so determined by the Administrative Agent and
the Borrower, to be held in a deposit account and released pro rata in order to
(x) satisfy such Defaulting Lender’s potential future funding obligations with
respect to Loans under this Agreement and (y) Cash Collateralize the L/C
Issuer’s future Fronting Exposure with respect to such Defaulting Lender with
respect to future Letters of Credit issued under this Agreement, in accordance
with Section 9.4; sixth, to the payment of any amounts owing to the Lenders, the
L/C Issuer as a result of any judgment of a court of competent jurisdiction
obtained by any Lender, the L/C Issuer against such Defaulting Lender as a
result of such Defaulting Lender’s breach of its obligations under this
Agreement; seventh, so long as no Default or Event of Default is then
continuing, to the payment of any amounts owing to the Borrower as a result of
any judgment of a court of competent jurisdiction obtained by the Borrower
against such Defaulting Lender as a result of such Defaulting Lender’s breach of
its obligations under this Agreement; and eighth, to such Defaulting Lender or
as otherwise directed by a court of competent jurisdiction; provided that if (x)
such payment is a payment of the principal amount of any Loans or L/C
Obligations in respect of which such Defaulting Lender has not fully funded its
appropriate share, and (y) such Loans were made or the related Letters of Credit
were issued at a time when the conditions set forth in Section 7.1 hereof were
satisfied or waived, such payment shall be applied solely to pay the Loans of,
and L/C Obligations owed to, all Non-Defaulting Lenders on a pro rata basis
prior to being applied to the payment of any Loans of, or L/C Obligations owed
to, such Defaulting Lender until such time as all Loans and funded and unfunded
participations in L/C Obligations are held by the Lenders pro rata in accordance
with their Percentages of the relevant Commitments without giving effect to
Section 1.14(a)(iv) below. Any payments, prepayments or other amounts paid or
payable to a Defaulting Lender that are applied (or held) to pay amounts owed by
a Defaulting Lender or to post Cash Collateral pursuant to this
Section 1.14(a)(ii) shall be deemed paid to and redirected by such Defaulting
Lender, and each Lender irrevocably consents hereto.

 

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(iii) Certain Fees.

 

(A) No Defaulting Lender shall be entitled to receive any commitment fee for any
period during which that Lender is a Defaulting Lender (and the Borrower shall
not be required to pay any such fee that otherwise would have been required to
have been paid to that Defaulting Lender).

 

(B) Each Defaulting Lender shall be entitled to receive L/C Participation Fees
for any period during which that Lender is a Defaulting Lender only to the
extent allocable to its Percentage of the stated amount of Letters of Credit for
which it has provided Cash Collateral pursuant to Section 9.4 hereof.

 

(C) With respect to any L/C Participation Fee not required to be paid to any
Defaulting Lender pursuant to clause (B) above, the Borrower shall pay to each
Non-Defaulting Lender that portion of any such fee otherwise payable to such
Defaulting Lender with respect to such Defaulting Lender’s participation in L/C
Obligations that has been reallocated to such Non-Defaulting Lender pursuant to
clause (iv) below.

 

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(iv) Reallocation of Participations to Reduce Fronting Exposure. All or any part
of such Defaulting Lender’s participation in L/C Obligations shall be
reallocated among the Non-Defaulting Lenders in accordance with their respective
Percentages of the relevant Commitments (calculated without regard to such
Defaulting Lender’s Commitments) but only to the extent that (x) the conditions
set forth in Section 7.1 hereof are satisfied at the time of such reallocation
(and, unless the Borrower shall have otherwise notified the Administrative Agent
at such time, the Borrower shall be deemed to have represented and warranted
that such conditions are satisfied at such time), and (y) such reallocation does
not cause the aggregate Revolving Loans and interests in L/C Obligations of any
Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Revolving Credit
Commitment. No reallocation hereunder shall constitute a waiver or release of
any claim of any party hereunder against a Defaulting Lender arising from that
Lender having become a Defaulting Lender, including any claim of a
Non-Defaulting Lender as a result of such Non-Defaulting Lender’s increased
exposure following such reallocation.

 

(v) Cash Collateral. If the reallocation described in clause (iv) above cannot,
or can only partially, be effected, the Borrower shall, without prejudice to any
right or remedy available to them hereunder or under law, Cash Collateralize the
L/C Issuer’s Fronting Exposure in accordance with the procedures set forth in
Section 9.4.

 

(b) Defaulting Lender Cure. If the Borrower, the Administrative Agent and each
L/C Issuer agree in writing that a Lender is no longer a Defaulting Lender, the
Administrative Agent will so notify the parties hereto, whereupon as of the
effective date specified in such notice and subject to any conditions set forth
therein (which may include arrangements with respect to any Cash Collateral),
that Lender will, to the extent applicable, purchase at par that portion of
outstanding Loans of the other Lenders or take such other actions as the
Administrative Agent may determine to be necessary to cause the Loans and funded
and unfunded participations in Letters of Credit to be held pro rata by the
Lenders in accordance with their respective Percentages of the relevant
Commitments (without giving effect to Section 1.14(a)(iv) hereof), whereupon
such Lender will cease to be a Defaulting Lender; provided that no adjustments
will be made retroactively with respect to fees accrued or payments made by or
on behalf of the Borrower while that Lender was a Defaulting Lender; and
provided, further, that except to the extent otherwise expressly agreed by the
affected parties, no change hereunder from Defaulting Lender to Lender will
constitute a waiver or release of any claim of any party hereunder arising from
that Lender’s having been a Defaulting Lender.

 

(c) New Letters of Credit. So long as any Lender is a Defaulting Lender, no L/C
Issuer shall be required to issue, extend, renew or increase any Letter of
Credit unless it is satisfied that it will have no Fronting Exposure after
giving effect thereto.

 

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Section 1.15. Increase in Commitments. The Borrower may, from time to time, on
any Business Day prior to the Termination Date, increase the aggregate amount of
the Commitments by delivering a commitment amount increase request substantially
in the form attached hereto as Exhibit H or in such other form acceptable to the
Administrative Agent at least five (5) Business Days prior to the desired
effective date of such increase (the “Commitment Amount Increase”) identifying
one or more additional Lenders (or additional Commitments for existing Lender(s)
or by a combination of existing Lenders and additional Lenders) and the amount
of its Commitment (or additional amount of its Commitment(s)); provided,
however, that (i) the aggregate amount of the Commitments shall not be incurred
to an amount in excess of $125,000,000, (ii) any Commitment Amount Increase
shall be in an amount not less than $5,000,000, (iii) no Default or Event of
Default shall have occurred and be continuing at the time of the request or the
effective date of the Commitment Amount Increase, and (iv) all representations
and warranties contained in Section 6 hereof shall be true and correct in all
material respects (where not already qualified by materiality, otherwise in all
respects) at the time of such request and on the effective date of such
Commitment Amount Increase (except to the extent such representations and
warranties relate to an earlier date, in which case they are true and correct in
all material respects (where not already qualified by materiality, otherwise in
all respects) as of such date). The effective date of the Commitment Amount
Increase shall be as set forth in the related commitment amount increase
request. Upon the effectiveness thereof, the new Lender(s) (or, if applicable,
existing Lender(s)) shall advance Loans in an amount sufficient such that after
giving effect to its advance each Lender shall have outstanding its Percentage
of Loans. It shall be a condition to such effectiveness that (i) if any
Eurodollar Loans are outstanding on the date of such effectiveness, such
Eurodollar Loans shall be deemed to be prepaid on such date and the Borrower
shall pay any amounts owing to the Lenders pursuant to Section 1.10 hereof and
(ii) the Borrower shall not have terminated any portion of the Commitments
pursuant to Section 1.11 hereof. The Borrower agrees to pay any reasonable and
documented, out-of-pocket expenses of the Administrative Agent relating to any
Commitment Amount Increase and, solely to the extent agreed upon in writing
between Administrative Agent and the Borrower (it being acknowledged that
Borrower shall have no obligation to enter into any such agreement), any
arrangement fees related thereto. Notwithstanding anything herein to the
contrary, no Lender shall have any obligation to increase its Commitment and no
Lender’s Commitment shall be increased without its consent thereto, and each
Lender may at its option, unconditionally and without cause, decline to increase
its Commitment.

 

Section 1.16. Extension of Termination Date. The Borrower may, by notice to the
Administrative Agent (which shall promptly deliver a copy to each of the
Lenders) given at least forty-five (45) days and not more than ninety (90) days
prior to the Stated Termination Date, request that Lenders extend the Stated
Termination Date through November 29, 2023. Upon the Borrower’s timely delivery
of such notice to the Administrative Agent and provided, that (i) no Default or
Event of Default has occurred and is continuing (both on the date the notice is
delivered and on the Stated Termination Date), (ii) all representations and
warranties contained in Section 6 hereof shall be true and correct in all
material respects (where not already qualified by materiality, otherwise in all
respects) on the date the notice is delivered and on the Stated Termination Date
Increase (except to the extent such representations and warranties relate to an
earlier date, in which case they are true and correct in all material respects
(where not already qualified by materiality, otherwise in all respects) as of
such date), and (iii) the Borrower has paid in immediately available funds the
Extension Fee on or prior to the Stated Termination Date, the Stated Termination
Date shall be extended to November 29, 2023. Should the Stated Termination Date
be extended, the terms and conditions of this Agreement will apply during the
extension period, and from and after the date of such extension, the term
“Stated Termination Date” shall mean November 29, 2023.

 

-16-

 

 

Section 2. Fees.

 

Section 2.1. Fees. (a) Commitment Fee. The Borrower shall pay to the
Administrative Agent for the ratable account of the Lenders in accordance with
their Percentages a commitment fee at a rate per annum equal to (x) 0.25% if the
average daily Unused Commitments are less than 50% of the Commitments then in
effect and (y) 0.35% if the average daily Unused Commitments are greater than or
equal to 50% of the Commitments then in effect (computed on the basis of a year
of 360 days and the actual number of days elapsed) and determined based on the
average daily Unused Commitments during such previous quarter. Such commitment
fee shall be payable quarterly in arrears on the last day of each March, June,
September, and December in each year (commencing June 30, 2017) and on the
Termination Date, unless the Commitments are terminated in whole on an earlier
date, in which event the commitment fee for the period to the date of such
termination in whole shall be calculated and paid on the date of such
termination. Any such commitment fee for the first quarter ending after the
Closing Date shall be prorated according to the number of days this Agreement
was in effect during such quarter.

 

(b) Letter of Credit Fees. On the date of issuance or extension, or increase in
the amount, of any Letter of Credit pursuant to Section 1.3 hereof, the Borrower
shall pay to the L/C Issuer for its own account a fronting fee equal to 0.125%
of the face amount of (or of the increase in the face amount of) such Letter of
Credit. Quarterly in arrears, on the last day of each March, June, September,
and December, commencing on the first such date occurring after the date hereof,
the Borrower shall pay to the Administrative Agent, for the ratable benefit of
the Lenders in accordance with their Percentages, a letter of credit fee (the
“L/C Participation Fee”) at a rate per annum equal to the Applicable Margin
(computed on the basis of a year of 360 days and the actual number of days
elapsed) in effect during each day of such quarter applied to the daily average
face amount of Letters of Credit outstanding during such quarter. In addition,
the Borrower shall pay to the L/C Issuer for its own account the L/C Issuer’s
standard issuance, drawing, negotiation, amendment, cancellation, assignment,
and other administrative fees for each Letter of Credit as established by the
L/C Issuer from time to time.

 

(c) Administrative Agent and Other Fees. The Borrower shall pay to the
Administrative Agent, for its own use and benefit and for the benefit of the
Lenders, as applicable, the fees agreed to between the Administrative Agent and
the Borrower in the First Amendment Fee Letter, or as otherwise agreed to in
writing between the Borrower and the Administrative Agent.

 

-17-

 

 

Section 3. Place and Application of Payments.

 

Section 3.1. Place and Application of Payments. All payments of principal of and
interest on the Loans and the Reimbursement Obligations, and of all other
Obligations payable by the Borrower under this Agreement and the other Loan
Documents, shall be made by the Borrower to the Administrative Agent by no later
than 12:00 Noon (Chicago time) on the due date thereof at the office of the
Administrative Agent in Chicago, Illinois (or such other location as the
Administrative Agent may designate to the Borrower), for the benefit of the
Lender(s) or L/C Issuer entitled thereto. Any payments received after such time
shall be deemed to have been received by the Administrative Agent on the next
Business Day. All such payments shall be made in U.S. Dollars, in immediately
available funds at the place of payment, in each case without set-off or
counterclaim. The Administrative Agent will promptly thereafter cause to be
distributed like funds relating to the payment of principal or interest on Loans
and on Reimbursement Obligations in which the Lenders have purchased
Participating Interests ratably to the Lenders and like funds relating to the
payment of any other amount payable to any Lender to such Lender, in each case
to be applied in accordance with the terms of this Agreement. If the
Administrative Agent causes amounts to be distributed to the Lenders in reliance
upon the assumption that the Borrower will make a scheduled payment and such
scheduled payment is not so made, each Lender shall, on demand, repay to the
Administrative Agent the amount distributed to such Lender together with
interest thereon in respect of each day during the period commencing on the date
such amount was distributed to such Lender and ending on (but excluding) the
date such Lender repays such amount to the Administrative Agent, at a rate per
annum equal to: (i) from the date the distribution was made to the date two
(2) Business Days after payment by such Lender is due hereunder, the Federal
Funds Rate for each such day and (ii) from the date two (2) Business Days after
the date such payment is due from such Lender to the date such payment is made
by such Lender, the Base Rate in effect for each such day.

 

Anything contained herein to the contrary notwithstanding (including, without
limitation, Section 1.8(b) hereof), all payments and collections received in
respect of the Obligations and all payments under or in respect of the
Guaranties received, in each instance, by the Administrative Agent or any of the
Lenders after acceleration or the final maturity of the Obligations or
termination of the Commitments as a result of an Event of Default shall be
remitted to the Administrative Agent and distributed as follows:

 

(a) first, to the payment of any outstanding costs and expenses incurred by the
Administrative Agent in protecting, preserving or enforcing rights under the
Loan Documents, and in any event including all costs and expenses of a character
which the Borrower has agreed to pay the Administrative Agent under
Section 12.15 hereof (such funds to be retained by the Administrative Agent for
its own account unless it has previously been reimbursed for such costs and
expenses by the Lenders, in which event such amounts shall be remitted to the
Lenders to reimburse them for payments theretofore made to the Administrative
Agent);

 

(b) second, to the payment of any outstanding interest and fees due under the
Loan Documents to be allocated pro rata in accordance with the aggregate unpaid
amounts owing to each holder thereof;

 

(c) third, to the payment of principal on the Loans, unpaid Reimbursement
Obligations, together with amounts to be held by the Administrative Agent as
collateral security for any outstanding L/C Obligations pursuant to Section 9.4
hereof (until the Administrative Agent is holding an amount of cash equal to the
then outstanding amount of all such L/C Obligations), and Hedging Liability, the
aggregate amount paid to, or held as collateral security for, the Lenders and
L/C Issuer and, in the case of Hedging Liability, their Affiliates to be
allocated pro rata in accordance with the aggregate unpaid amounts owing to each
holder thereof;

 

-18-

 

 

(d) fourth, to the payment of all other unpaid Obligations and all other
indebtedness, obligations, and liabilities of the Borrower and the Guarantors
evidenced by the Loan Documents (including, without limitation, Bank Product
Obligations) to be allocated pro rata in accordance with the aggregate unpaid
amounts owing to each holder thereof; and

 

(e) finally, to the Borrower or whoever else may be lawfully entitled thereto.

 

Section 3.2. Account Debit. The Borrower hereby irrevocably authorizes the
Administrative Agent to, solely during the continuation of an Event of Default,
charge any of the Borrower’s deposit accounts maintained with the Administrative
Agent for the amounts from time to time necessary to pay any then due
Obligations; provided that the Borrower acknowledges and agrees that the
Administrative Agent shall not be under an obligation to do so and the
Administrative Agent shall not incur any liability to the Borrower or any other
Person for the Administrative Agent’s failure to do so.

 

Section 4. Guaranties .

 

Section 4.1. Guaranties. The payment and performance of the Obligations, Hedging
Liability, and Bank Product Obligations shall at all times be guaranteed by each
Subsidiary that owns a Borrowing Base Property pursuant to Section 13 hereof or
pursuant to one or more guaranty agreements in form and substance reasonably
acceptable to the Administrative Agent, as the same may be amended, modified or
supplemented from time to time (individually a “Guaranty” and collectively the
“Guaranties” and each such Subsidiary executing and delivering this Agreement as
a Guarantor or any such separate Guaranty being referred to herein as a
“Guarantor” and collectively the “Guarantors”).

 

Section 4.2. Further Assurances. In the event the Borrower desires to include
any additional Eligible Property in the Borrowing Base Value after the Closing
Date, to the extent that such Eligible Property is not owned by an existing
Guarantor, as a condition to the inclusion of such Eligible Property in the
Borrowing Base Value, the Borrower shall cause the Subsidiary which owns such
Eligible Property to execute a Guaranty or an Additional Guarantor Supplement in
the form of Exhibit G attached hereto (the “Additional Guarantor Supplement”) as
the Administrative Agent may then require, and the Borrower shall also deliver
to the Administrative Agent, or cause such Subsidiary to deliver to the
Administrative Agent, at the Borrower’s cost and expense, such other
instruments, documents, certificates, and opinions reasonably required by the
Administrative Agent in connection therewith.

 

Section 4.3. Depository Bank. The Borrower shall maintain the Depository Account
with the Administrative Agent (or one of its Affiliates, as designated in
writing by the Administrative Agent to the Borrower).

 

-19-

 

 

Section 5. Definitions; Interpretation.

 

Section 5.1. Definitions. The following terms when used herein shall have the
following meanings:

 

“Act” is defined in Section 12.24 hereof.

 

“Additional Guarantor Supplement” is defined in Section 4.2 hereof.

 

“Adjusted LIBOR” is defined in Section 1.4(b) hereof.

 

“Adjusted Property NOI” means, for any Rolling Period, (i) with respect to any
Real Property owned for more than twelve (12) months, the Property NOI minus the
Annual Capital Expenditure Reserve for such Real Property, and (ii) with respect
to any Real Property owned for twelve (12) months or less, the Pro Forma
Property NOI for such Real Property computed on an annualized basis minus the
Annual Capital Expenditure Reserve for such Real Property.

 

“Administrative Agent” means Bank of Montreal, in its capacity as Administrative
Agent hereunder, and any successor in such capacity pursuant to Section 11.7
hereof.

 

“Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by the Administrative Agent.

 

“Affected Lender” is defined in Section 1.13 hereof.

 

“Affiliate” means any Person directly or indirectly controlling or controlled
by, or under direct or indirect common control with, another Person. A Person
shall be deemed to control another Person for purposes of this definition if
such Person possesses, directly or indirectly, the power to direct, or cause the
direction of, the management and policies of the other Person, whether through
the ownership of voting securities, common directors, trustees or officers, by
contract or otherwise; provided that, in any event for purposes of this
definition, other than with respect to the Borrower, any Person that owns,
directly or indirectly, 5% or more of the securities having the ordinary voting
power for the election of directors or governing body of a corporation or 5% or
more of the partnership or other ownership interest of any other Person (other
than as a limited partner of such other Person) will be deemed to control such
corporation or other Person. Notwithstanding the foregoing, for purposes of the
Loan Documents, Monmouth Real Estate Investment Corp. and its subsidiaries shall
not be deemed to be Affiliates of the Borrower or any Subsidiary.

 

“Agreement” means this Credit Agreement, as the same may be amended, modified,
restated or supplemented from time to time pursuant to the terms hereof.

 

“Annual Capital Expenditure Reserve” means, with respect to any Real Property,
an amount equal to the product of (i) $50 multiplied by (ii) the number of Sites
located on such Real Property.

 

-20-

 

 

“Anti-Corruption Law” means the FCPA and any law, rule or regulation of any
jurisdiction concerning or relating to bribery or corruption that are applicable
to the Borrower or any Subsidiary or Affiliate.

 

“Applicable Margin” means, with respect to Loans, Reimbursement Obligations, and
letter of credit fees payable under Section 2.1 hereof, from the First Amendment
Effective Date until the first Pricing Date occurring thereafter, the rates per
annum shown opposite Level II below, and thereafter from one Pricing Date to the
next, the Applicable Margin means the rates per annum determined in accordance
with the following schedule:

 

Level  Total Indebtedness to Total
Asset Value Ratio for Such
Pricing Date  Applicable Margin
for Base Rate Loans
and Reimbursement
Obligations shall be:   Applicable Margin
for Eurodollar
Loans and Letter of
credit Fee Shall Be:  I  Less than or equal to 0.35 to 1.00   0.50%   1.50% II 
Less than or equal to 0.40 to 1.00 but greater than 0.35 to 1.00   0.60%   1.60%
III  Less than or equal to 0.45 to 1.00, but greater than 0.40 to 1.00   0.70% 
 1.70% IV  Less than or equal to 0.50 to 1.00, but greater than 0.45 to 1.00 
 0.80%   1.80% V  Less than or equal to 0.55 to 1.00, but greater than 0.50 to
1.00   0.90%   1.90% VI  Greater than 0.55 to 1.00   1.20%   2.20%

 

For purposes hereof, the term “Pricing Date” means, for any Fiscal Quarter of
the Borrower ending on or after December 31, 2018, the date on which the
Administrative Agent is in receipt of the Borrower’s most recent Compliance
Certificate and financial statements (and, in the case of the year-end financial
statements, audit report) (the “Borrower Information”) for the Fiscal Quarter
then ended, pursuant to Section 8.5 hereof. The Applicable Margin shall be
established based on the Total Indebtedness to Total Asset Value Ratio for the
most recently completed Fiscal Quarter and the Applicable Margin established on
a Pricing Date shall remain in effect until the next Pricing Date. If the
Borrower has not delivered the Borrower Information by the date the same is
required to be delivered under Section 8.5 hereof, then until such Borrower
Information is delivered, the Applicable Margin shall be the highest Applicable
Margin (i.e., Level VI shall apply). If the Borrower subsequently delivers such
Borrower Information before the next Pricing Date, the Applicable Margin
established by such late delivered Borrower Information shall take effect from
the date of delivery until the next Pricing Date. In all other circumstances,
the Applicable Margin established by such Borrower Information shall be in
effect from the Pricing Date that occurs immediately after the end of the Fiscal
Quarter covered by such Borrower Information until the next Pricing Date. Each
determination of the Applicable Margin made by the Administrative Agent in
accordance with the foregoing shall be conclusive and binding on the Borrower
and the Lenders if reasonably determined. The parties understand that the
Applicable Margin set forth herein shall be determined and may be adjusted from
time to time based upon the Borrower Information. If it is subsequently
determined that any such Borrower Information was incorrect (for whatever
reason, including, without limitation, because of a subsequent restatement of
earnings by the Borrower) at the time it was delivered to the Administrative
Agent and the Lenders, and if the applicable interest rate or fees calculated
for any period were lower than they should have been had the correct information
been timely provided, then such Applicable Margin for such period shall be
automatically recalculated using the correct Borrower Information. The
Administrative Agent shall promptly notify the Borrower in writing of any
additional interest and fees due because of such recalculation, and the Borrower
shall pay within five (5) Business Days of receipt of such written notice such
additional interest or fees due to the Administrative Agent, for the account of
each Lender holding Commitments and Loans at the time the additional interest
and fee payment is received. Any recalculation of the Applicable Margin required
by this provision shall survive the termination of this Agreement, and this
provision shall not in any way limit any of the Administrative Agent’s or any
Lender’s other rights under this Agreement.

 

-21-

 

 

“Application” is defined in Section 1.3(b) hereof.

 

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

 

“Asset Under Development” means any Real Property under construction (excluding
any completed Real Property under minor renovation and any Real Property that is
substantially completed with an Occupancy Rate of at least 65%).

 

“Assignment and Acceptance” means an assignment and acceptance entered into by a
Lender and an Eligible Assignee (with the consent of any party whose consent is
required by Section 12.12 hereof), and accepted by the Administrative Agent, in
substantially the form of Exhibit F or any other form approved by the
Administrative Agent.

 

“Authorized Representative” means those persons shown on the list of officers
provided by the Borrower pursuant to Section 7.2 hereof or on any update of any
such list provided by the Borrower to the Administrative Agent, or any further
or different officers of the Borrower so named by any Authorized Representative
of the Borrower in a written notice to the Administrative Agent.

 

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

 

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

 

-22-

 

 

“Bank Products” means each and any of the following bank products and services
provided to the Borrower or any Guarantor by any Lender or any of its
Affiliates: (a) credit or charge cards for commercial customers (including,
without limitation, “commercial credit cards” and purchasing cards), (b) stored
value cards and (c) depository, cash management and treasury management services
(including, without limitation, controlled disbursement, automated clearinghouse
transactions, return items, overdrafts and interstate depository network
services).

 

“Bank Product Obligations” of the Borrower and the Guarantors means any and all
of their obligations, whether absolute or contingent and howsoever and
whensoever created, arising, evidenced or acquired (including all renewals,
extensions and modifications thereof and substitutions therefor) in connection
with Bank Products.

 

“Bankruptcy Event” means, with respect to any Person, any event of the type
described in clause (j) or (k) of Section 9.1 hereof with respect to such
Person.

 

“Base Rate” is defined in Section 1.4(a) hereof.

 

“Base Rate Loan” means a Loan bearing interest at a rate specified in
Section 1.4(a) hereof.

 

“Beneficial Ownership Certification” means a certification regarding beneficial
ownership as required by the Beneficial Ownership Regulation, in form and
substance satisfactory to the Administrative Agent.

 

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

 

“Borrower” is defined in the introductory paragraph of this Agreement.

 

“Borrowing” means the total of Loans of a single type advanced, continued for an
additional Interest Period, or converted from a different type into such type by
the Lenders on a single date and, in the case of Eurodollar Loans, for a single
Interest Period. Borrowings of Loans are made and maintained ratably from each
of the Lenders according to their Percentages. A Borrowing is “advanced” on the
day Lenders advance funds comprising such Borrowing to the Borrower, is
“continued” on the date a new Interest Period for the same type of Loans
commences for such Borrowing, and is “converted” when such Borrowing is changed
from one type of Loans to the other, all as determined pursuant to Section 1.6
hereof.

 

“Borrowing Base” means, at any date of its determination, the lesser of (i) an
amount equal to 60% of the Borrowing Base Value of all Borrowing Base Properties
on such date and (ii) an amount equal to the Debt Service Coverage Amount of all
Borrowing Base Properties on such date.

 

“Borrowing Base Certificate” means the certificate in the form of Exhibit I
hereto, or in such other form reasonably acceptable to the Administrative Agent,
to be delivered to the Administrative Agent pursuant to Sections 7.2(j), 7.3 and
8.5 hereof.

 

-23-

 

 

“Borrowing Base Determination Date” means each date on which the Borrowing Base
is certified in writing to the Administrative Agent, which shall occur as
follows:

 

(a) Quarterly. For quarterly certifications, as of the last day of each Fiscal
Quarter.

 

(b) Property Adjustments. Following each addition or deletion of an Eligible
Property, promptly following such addition or deletion.

 

“Borrowing Base NOI” means, with respect to any Rolling Period, the aggregate
Property NOI attributable to the Eligible Properties for such period.

 

“Borrowing Base Property” means, as at any date of determination, any Eligible
Property which is taken into account in calculating the Borrowing Base Value.

 

“Borrowing Base Requirements” means with respect to the calculation of the
Borrowing Base, collectively, that (a) the Borrowing Base Value shall at all
times be equal to or in excess of $35,000,000; (b) no more than 15% of the
Borrowing Base Value may be comprised of any one Eligible Property; and (c) the
weighted average (based on Borrowing Base Value) Occupancy Rate of all Eligible
Properties included in the Borrowing Base shall be no less than 70%.

 

“Borrowing Base Value” means, as at any date of its determination, an amount
equal to the quotient of (a) the Borrowing Base NOI for the most recent Rolling
Period divided by (b) the Capitalization Rate.

 

“Business Day” means any day (other than a Saturday or Sunday) on which banks
are not authorized or required to close in Chicago, Illinois and, if the
applicable Business Day relates to the advance or continuation of, or conversion
into, or payment of a Eurodollar Loan, on which banks are dealing in U.S. Dollar
deposits in the interbank eurodollar market in London, England.

 

“Capital Lease” means any lease of Property which in accordance with GAAP is
required to be capitalized on the balance sheet of the lessee.

 

“Capitalization Rate” means 7.00% for all Real Properties.

 

“Capitalized Lease Obligation” means, for any Person, the amount of the
liability shown on the balance sheet of such Person in respect of a Capital
Lease determined in accordance with GAAP.

 

“Cash Collateralize” means, to pledge and deposit with or deliver to the
Administrative Agent, for the benefit of one or more of the L/C Issuer or
Lenders, as collateral for L/C Obligations or obligations of Lenders to fund
participations in respect of L/C Obligations, cash or deposit account balances
subject to a first priority perfected security interest in favor of the
Administrative Agent or, if the Administrative Agent and each applicable L/C
Issuer shall agree in their sole discretion, other credit support, in each case
pursuant to documentation in form and substance satisfactory to the
Administrative Agent and each applicable L/C Issuer. “Cash Collateral” shall
have a meaning correlative to the foregoing and shall include the proceeds of
such cash collateral and other credit support.

 

-24-

 

 

“CERCLA” means the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. §§9601 et seq., and any future
amendments.

 

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption or taking effect of any law, rule, regulation
or treaty, (b) any change in any law, rule, regulation or treaty or in the
administration, interpretation, implementation or application thereof by any
Governmental Authority, or (c) the making or issuance of any request, rule,
guideline or directive (whether or not having the force of law) by any
Governmental Authority; provided that notwithstanding anything herein to the
contrary,(x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, regulations, guidelines or directives thereunder or issued
in connection therewith shall be deemed to be a “Change in Law”, regardless of
the date enacted, adopted or issued and (y) all requests, rules, guidelines or
directives promulgated by the Bank for International Settlements, the Basel
Committee on Banking Supervision (or any successor or similar authority) or the
United States or foreign regulatory authorities, in each case pursuant to Basel
III, shall in each case be deemed to be a “Change in Law”, regardless of the
date enacted, adopted or issued.

 

“Change of Control” means any of (a) the acquisition by any “person” or “group”
(as such terms are used in sections 13(d) and 14(d) of the Securities Exchange
Act of 1934, as amended) at any time of beneficial ownership of 20% or more of
the outstanding capital stock or other equity interests of the Borrower on a
fully-diluted basis, (b) the failure of individuals who are members of the board
of directors (or similar governing body) of the Borrower on the Closing Date
(together with any new or replacement directors whose initial nomination for
election was approved by a majority of the directors who were either directors
on the Closing Date or previously so approved) to constitute a majority of the
board of directors (or similar governing body) of the Borrower, or (c) any
“Change of Control” (or words of like import), as defined in any agreement or
indenture relating to any issue of Indebtedness of the Borrower or any Guarantor
shall occur.

 

“Closing Date” means the date of this Agreement.

 

“Code” means the Internal Revenue Code of 1986, as amended, and any successor
statute thereto.

 

“Collateral Account” is defined in Section 9.4 hereof.

 

“Commitment” means, as to any Lender, the obligation of such Lender to make
Loans and to participate in Letters of Credit issued for the account of the
Borrower hereunder in an aggregate principal or face amount at any one time
outstanding not to exceed the amount set forth opposite such Lender’s name on
Schedule 1 attached hereto and made a part hereof, as the same may be reduced or
modified at any time or from time to time pursuant to the terms hereof. The
Borrower and the Lenders acknowledge and agree that the Commitments of the
Lenders, in the aggregate, are equal to $75,000,000 on the Closing Date.

 

-25-

 

 

“Commitment Amount Increase” is defined in Section 1.13 hereof.

 

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et
seq.), as amended from time to time, and any successor statute.

 

“Compliance Certificate” is defined in Section 8.5 hereof.

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profit Taxes.

 

“Controlled Group” means all members of a controlled group of corporations and
all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower, are treated as a single employer under
Section 414 of the Code.

 

“Credit Event” means the advancing of any Loan, or the issuance of, or extension
of the expiration date or increase in the amount of, any Letter of Credit.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United States of America,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect.

 

“Debt Service” means, with reference to any period, the sum of (a) Interest
Expense for such period and (b) the greater of (i) zero or (ii) scheduled
principal amortization paid on Total Indebtedness for such period (exclusive of
any balloon payments or prepayments of principal paid on such Total
Indebtedness).

 

“Debt Service Coverage Amount” means, for the applicable Eligible Properties,
the principal amount of a loan that would be serviced by the Adjusted Property
NOI for the four Fiscal Quarter period most recently ended (and for which
financial statements have been delivered pursuant to Section 8.5 hereof) at a
debt service coverage ratio of 1.45 to 1.00 with interest and principal payments
(in each case assuming a 25-year amortization) at the greater of (i) 6.25% per
annum, and (ii) the 10-year treasury rate on the last day of such period plus
2.50%.

 

“Default” means any event or condition the occurrence of which would, with the
passage of time or the giving of notice, or both, constitute an Event of
Default.

 

-26-

 

 

“Defaulting Lender” means, subject to Section 1.14(b), any Lender that (a) has
failed to (i) fund all or any portion of its Loans within two (2) Business Days
of the date such Loans were required to be funded hereunder unless such Lender
notifies the Administrative Agent and the Borrower in writing that such failure
is the result of such Lender’s determination that one or more conditions
precedent to funding (each of which conditions precedent, together with any
applicable default, shall be specifically identified in such writing) has not
been satisfied, or (ii) pay to the Administrative Agent, any L/C Issuer or any
other Lender any other amount required to be paid by it hereunder (including in
respect of its participation in Letters of Credit) within two (2) Business Days
of the date when due, (b) has notified the Borrower, the Administrative Agent or
any L/C Issuer in writing that it does not intend to comply with its funding
obligations hereunder, or has made a public statement to that effect (unless
such writing or public statement relates to such Lender’s obligation to fund a
Loan hereunder and states that such position is based on such Lender’s
determination that a condition precedent to funding (which condition precedent,
together with any applicable default, shall be specifically identified in such
writing or public statement) cannot be satisfied), (c) has failed, within three
(3) Business Days after written request by the Administrative Agent or the
Borrower, to confirm in writing to the Administrative Agent and the Borrower
that it will comply with its prospective funding obligations hereunder (provided
that such Lender shall cease to be a Defaulting Lender pursuant to this clause
(c) upon receipt of such written confirmation by the Administrative Agent and
the Borrower), or (d) has, or has a direct or indirect parent company that has,
at any time after the Closing Date, (i) become the subject of a proceeding under
any Debtor Relief Law, (ii) had appointed for it a receiver, custodian,
conservator, trustee, administrator, assignee for the benefit of creditors or
similar Person charged with reorganization or liquidation of its business or
assets, including the Federal Deposit Insurance Corporation or any other state
or federal regulatory authority acting in such a capacity, or (iii) become the
subject of a Bail-In Action; provided that a Lender shall not be a Defaulting
Lender solely by virtue of the ownership or acquisition of any equity interest
in that Lender or any direct or indirect parent company thereof by a
Governmental Authority so long as such ownership interest does not result in or
provide such Lender with immunity from the jurisdiction of courts within the
United States or from the enforcement of judgments or writs of attachment on its
assets or permit such Lender (or such Governmental Authority) to reject,
repudiate, disavow or disaffirm any contracts or agreements made with such
Lender. Any determination by the Administrative Agent that a Lender is a
Defaulting Lender under clauses (a) through (d) above shall be conclusive and
binding absent manifest error, and such Lender shall be deemed to be a
Defaulting Lender (subject to Section 1.14(b)) upon delivery of written notice
of such determination to the Borrower, the L/C Issuer and each Lender.

 

“Depository Account” means that certain account maintained by the Borrower with
BMO Harris Bank N.A. (Account #431-084-3) or any successor account thereto.

 

“Dividends” means any dividend paid (or declared and then payable), as the case
may be, in cash on any equity security issued by the Borrower.

 

“EBITDA” means, for any period, determined on a consolidated basis of the
Borrower and its Subsidiaries in accordance with GAAP, net income (or loss) for
such period plus, without duplication and to the extent included as an expense
in the calculation of net income (or loss) for such period, the sum of
(i) depreciation and amortization expense; (ii) Interest Expense; (iii) income
tax expense; (iv) extraordinary, unrealized or non-recurring losses, including
impairment charges; and (v) reasonable transaction costs and expenses incurred
during such period in connection with acquisitions permitted hereunder, minus,
without duplication and to the extent included as income in the calculation of
net income (or loss) for such period, (a) funds received by the Borrower or a
Subsidiary as rent but which are reserved for capital expenses;
(b) extraordinary or unrealized gains (including gains on the sale of assets);
and (c) income tax benefits.

 

-27-

 

 

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

 

“EEA Member Country” means any of the member states of the European Union,
Iceland, Liechtenstein, and Norway.

 

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

 

“Eligible Assignee” means (a) a Lender, (b) an Affiliate of a Lender, (c) an
Approved Fund, and (d) any other Person (other than a natural person) approved
by (i) the Administrative Agent, (ii) the L/C Issuer, and (iii) unless an Event
of Default has occurred and is continuing, the Borrower (each such approval not
to be unreasonably withheld or delayed); provided that notwithstanding the
foregoing, “Eligible Assignee” shall not include the Borrower, any Subsidiary or
any other Affiliate of the Borrower or any Subsidiary.

 

“Eligible Property” means, as of any Borrowing Base Determination Date, any Real
Property owned by the Borrower or a Subsidiary which satisfies the following
conditions:

 

(a) such Real Property is one hundred percent (100%) owned in fee simple by the
Borrower or any Subsidiary;

 

(b) such Real Property is located in the contiguous United States;

 

(c) if the Property Owner is the Borrower, (i) neither the Borrower’s beneficial
ownership interest in such Real Property nor the Real Property is subject to any
Lien (other than Permitted Liens) or to any negative pledge and (ii) the
Borrower has the unilateral right to sell, transfer or otherwise dispose of such
Real Property and to create a Lien on such Real Property as security for
Indebtedness;

 

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

 

-28-

 

 

(e) such Real Property has an Occupancy Rate of at least 45%;

 

(f) the Administrative Agent shall have received, to the extent requested by it,
historic operating statements for such Real Property for the previous three (3)
years, if available, and historic rent rolls for such Real Property for the
previous three (3) years, if available;

 

(g) such Real Property, based on the Borrower’s and, if the Property Owner is a
Subsidiary, such 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, would reasonably be expected to materially impair the value of
such Real Property;

 

(h) no more than 10% of the Tenants of such Real Property are more than 60 days
in arrears on base rental or other similar payments due under their applicable
Leases, but without taking into any Tenant which is making payments in respect
of base rental or other similar payments that are delinquent pursuant to a
written payment plan with the Borrower or the applicable Subsidiary; and

 

(i) if the Property Owner is not the Borrower, unless the same have previously
been delivered to the Administrative Agent, such Property Owner shall have
delivered to the Administrative Agent a copy, certified as true and correct by a
duly authorized officer of such Property Owner, of each of the following: (i)
the Property Owner’s articles of incorporation, by-laws, partnership agreement
or operating agreement, as applicable, (ii) certificates of existence, good
standing and authority to do business from each appropriate state authority, and
(iii) partnership, corporate or limited liability company, as applicable,
authorizations authorizing the execution, delivery and performance of the
applicable Guaranty.

 

“Environmental Claim” means any investigation, notice, violation, demand,
allegation, action, suit, injunction, judgment, order, consent decree, penalty,
fine, lien, proceeding or claim (whether administrative, judicial or private in
nature) arising (a) pursuant to, or in connection with an actual or alleged
violation of, any Environmental Law, (b) in connection with any Hazardous
Material, (c) from any abatement, removal, remedial, corrective or response
action in connection with a Hazardous Material, Environmental Law or order of a
Governmental Authority or (d) from any actual or alleged damage, injury, threat
or harm to health, safety, natural resources or the environment.

 

“Environmental Law” means any current or future Legal Requirement pertaining to
(a) the protection of health, safety and the indoor or outdoor environment, (b)
the conservation, management or use of natural resources and wildlife, (c) the
protection or use of surface water or groundwater, (d) the management,
manufacture, possession, presence, use, generation, transportation, treatment,
storage, disposal, Release, threatened Release, abatement, removal, remediation
or handling of, or exposure to, any Hazardous Material or (e) pollution
(including any Release to air, land, surface water or groundwater), and any
amendment, rule, regulation, order or directive issued thereunder.

 

-29-

 

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
or any successor statute thereto.

 

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

 

“Eurodollar Loan” means a Loan bearing interest at the rate specified in
Section 1.4(b) hereof.

 

“Eurodollar Reserve Percentage” is defined in Section 1.4(b) hereof.

 

“Event of Default” means any event or condition identified as such in
Section 9.1 hereof.

 

“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap
Obligation if, and to the extent that, all or a portion of the Guarantee of such
Guarantor of, or the grant by such Guarantor of a security interest to secure,
such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the
Commodity Exchange Act or any rule, regulation or order of the Commodity Futures
Trading Commission (or the application or official interpretation of any
thereof) by virtue of such Guarantor’s failure for any reason not to constitute
an “eligible contract participant” as defined in the Commodity Exchange Act and
the regulations thereunder at the time the Guarantee of such Guarantor or the
grant of such security interest becomes effective with respect to such Swap
Obligation. If a Swap Obligation arises under a master agreement governing more
than one swap, such exclusion shall apply only to the portion of such Swap
Obligation that is attributable to swaps for which such Guarantee or security
interest is or becomes illegal.

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result
of such Recipient being organized under the laws of, or having its principal
office or, in the case of any Lender, its applicable lending office located in,
the jurisdiction imposing such Tax (or any political subdivision thereof) or
(ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal
withholding Taxes imposed on amounts payable to or for the account of such
Lender with respect to an applicable interest in a Loan or Commitment pursuant
to a law in effect on the date on which (i) such Lender acquires such interest
in the Loan or Commitment (other than pursuant to an assignment request by the
Borrower under Section 1.14 hereof) or (ii) such Lender changes its lending
office, except in each case to the extent that, pursuant to Section 13.1 amounts
with respect to such Taxes were payable either to such Lender’s assignor
immediately before such Lender became a party hereto or to such Lender
immediately before it changed its lending office, (c) Taxes attributable to such
Recipient’s failure to comply with Section 13.1(b) or Section 13.1(d), and
(d) any U.S. federal withholding Taxes imposed under FATCA.

 

“Existing Lenders” is defined in the Preliminary Statements of this Agreement.

 

-30-

 

 

“Extension Fee” means an extension fee payable by the Borrower to the
Administrative Agent for the ratable benefit of the Lenders as a condition to
the extension of the Stated Termination Date pursuant to Section 1.16 hereto in
an amount equal to 0.15% of the Commitments then in effect.

 

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof, and any agreements entered into
pursuant to Section 1471(b)(1) of the Code.

 

“FCPA” means the Foreign Corrupt Practices Act, 15 U.S.C. §§78dd-1, et seq.

 

“Federal Funds Rate” means, for any day, the rate per annum equal to the
weighted average of the rates on overnight federal funds transactions with
members of the Federal Reserve System, as published by the Federal Reserve Bank
of New York on the Business Day next succeeding such day; provided that (a) if
such day 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 (b) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate (rounded upward, if necessary, to a whole multiple
of 1/100 of 1%) charged to the Administrative Agent on such day on such
transactions as determined by the Administrative Agent; provided that in no
event shall the Federal Funds Rate be less than 0.00%.

 

“First Amendment” means, that certain First Amendment to Credit Agreement dated
as of the First Amendment Effective Date by and among the Borrower, the Lenders
signatories thereto and Agent.

 

“First Amendment Effective Date” means November 29, 2018.

 

“First Amendment Fee Letter” means, that certain First Amendment Fee Letter
dated as of November 26, 2018, by and between the Borrower and Agent.

 

“Fiscal Quarter” means each of the three-month periods ending on March 31, June
30, September 30 and December 31 of each Fiscal Year.

 

“Fiscal Year” means each twelve-month period ending on December 31.

 

“Fixed Charges” means, with reference to any period, Debt Service for such
period, plus required distributions (other than distributions by the Borrower to
holders of operating partnership units and distributions by Borrower to common
and preferred equity holders) made or to be made during such period, plus
payments of base rent under Ground Leases made or to be made during such period,
unless such payments are deducted from Property NOI and EBITDA.

 

-31-

 

 

“Floating Rate Debt” means, as of any date of determination, all Indebtedness
with a variable interest rate that is not subject to a Hedging Agreement
providing protection against fluctuations in interest rates.

 

“Foreign Lender” means a Lender that is not a U.S. Person.

 

“Fronting Exposure” means, at any time there is a Defaulting Lender, with
respect to any L/C Issuer, such Defaulting Lender’s Percentage of the
outstanding L/C Obligations with respect to Letters of Credit issued by such L/C
Issuer other than L/C Obligations as to which such Defaulting Lender’s
participation obligation has been reallocated to other Lenders or Cash
Collateralized in accordance with the terms hereof.

 

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

 

“GAAP” means generally accepted accounting principles set forth from time to
time 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 agencies with
similar functions of comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.

 

“Governmental Authority” means the government of the United States of America or
any other nation, or of any political subdivision thereof, whether state or
local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory or administrative powers or functions of or pertaining to
government (including any supra-national bodies such as the European Union or
the European Central Bank).

 

“Ground Lease” means a long term lease of real Property granted by the fee owner
of the real Property.

 

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.

 

-32-

 

 

“Guarantor” and “Guarantors” are defined in Section 4.1 hereof.

 

“Guaranty” and “Guaranties” are defined in Section 4.1 hereof.

 

“Hazardous Material” means any substance, chemical, compound, product, solid,
gas, liquid, waste, byproduct, pollutant, contaminant or material which is
hazardous or toxic and is regulated under Environmental Law, and includes,
without limitation, (a) asbestos, polychlorinated biphenyls and petroleum
(including crude oil or any fraction thereof) and (b) any material classified or
regulated as “hazardous” or “toxic” or words of like import pursuant to an
Environmental Law.

 

“Hazardous Material Activity” means any activity, event or occurrence involving
a Hazardous Material, including, without limitation, the manufacture,
possession, presence, use, generation, transportation, treatment, storage,
disposal, Release, threatened Release, abatement, removal, remediation, handling
of or corrective or response action to any Hazardous Material.

 

“Hedging Agreement” means any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or
debt instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no phantom
stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of
the Borrower or its Subsidiaries shall be a Hedging Agreement.

 

“Hedging Liability” means the liability of the Borrower or any Guarantor to any
of the Lenders, or any Affiliates of such Lenders in respect of any Hedging
Agreement as the Borrower or such Guarantor, as the case may be, may from time
to time enter into with any one or more of the Lenders party to this Agreement
or their Affiliates, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor); provided, however, that, with
respect to any Guarantor, Hedging Liability Guaranteed by such Guarantor shall
exclude all Excluded Swap Obligations.

 

“Indebtedness” means for any Person (without duplication) (a) all indebtedness
created, assumed or incurred in any manner by such Person representing money
borrowed (including by the issuance of debt securities), (b) all indebtedness
for the deferred purchase price of property or services (other than trade
accounts payable arising in the ordinary course of business which are not more
than one hundred eighty (180) days past due), (c) all indebtedness secured by
any Lien upon Property of such Person, whether or not such Person has assumed or
become liable for the payment of such indebtedness, (d) all Capitalized Lease
Obligations of such Person, (e) all obligations of such Person on or with
respect to letters of credit, bankers’ acceptances and other similar extensions
of credit whether or not representing obligations for borrowed money and (f) all
net obligations of such Person under any Hedging Agreement.

 

-33-

 

 

“Indemnified Taxes” means (a) all Taxes other than Excluded Taxes and (b) to the
extent not otherwise described in (a), Other Taxes.

 

“Initial Borrowing Base Properties” means, collectively, each Real Property
listed on Schedule 1.1 and “Initial Borrowing Base Property” means any of such
Real Property.

 

“Interest Expense” means, with respect to a Person for any period of time, the
interest expense whether paid, accrued or capitalized (without deduction of
consolidated interest income) of such Person for such period. Interest Expense
shall exclude any amortization of (i) deferred financing fees, including the
write-off of such fees relating to the early retirement of the related
Indebtedness, and (ii) debt discounts (but only to the extent such discounts do
not exceed 3.0% of the initial face principal amount of the related
Indebtedness).

 

“Interest Payment Date” means (a) with respect to any Eurodollar Loan, the last
day of each Interest Period with respect to such Eurodollar Loan and, if the
applicable Interest Period is longer than (3) three months, each day occurring
every three (3) months after the commencement of such Interest Period, (b) with
respect to any Base Rate Loan, the last day of every calendar quarter, and (c)
with respect to any Eurodollar Loan and/or any Base Rate Loan, the Termination
Date.

 

“Interest Period” means the period commencing on the date a Borrowing of
Eurodollar Loans is advanced, continued, or created by conversion and ending one
(1), two (2), three (3), or six (6) months thereafter, provided, however, that:

 

(i) no Interest Period shall extend beyond the Termination Date;

 

(ii) whenever the last day of any Interest Period would otherwise be a day that
is not a Business Day, the last day of such Interest Period shall be extended to
the next succeeding Business Day, provided that, if such extension would cause
the last day of an Interest Period for a Borrowing of Eurodollar Loans to occur
in the following calendar month, the last day of such Interest Period shall be
the immediately preceding Business Day; and

 

(iii) for purposes of determining an Interest Period for a Borrowing of
Eurodollar Loans, a month means a period starting on one day in a calendar month
and ending on the numerically corresponding day in the next calendar month;
provided, however, that if there is no numerically corresponding day in the
month in which such an Interest Period is to end or if such an Interest Period
begins on the last Business Day of a calendar month, then such Interest Period
shall end on the last Business Day of the calendar month in which such Interest
Period is to end.

 

“Land Assets” means any Real Property which is not an Asset Under Development
and on which no significant improvements have been constructed. For the
avoidance of doubt, Land Assets shall not include any Real Property upon which
any Sites have been, or are in the process of being, developed.

 

-34-

 

 

“L/C Issuer” means Bank of Montreal, in its capacity as the issuer of Letters of
Credit hereunder, and its successors in such capacity as provided in
Section 1.3(h) hereof.

 

“L/C Obligations” means the aggregate undrawn face amounts of all outstanding
Letters of Credit and all unpaid Reimbursement Obligations.

 

“L/C Participation Fee” is defined in Section 2.1(c) hereof.

 

“L/C Sublimit” means $5,000,000, as such amount may be reduced pursuant to the
terms hereof.

 

“Lease” means each existing or future lease, sublease, license, or other similar
agreement under the terms of which any Person has or acquires any right to
occupy any Real Property or any part thereof, or interest therein, as the same
may be amended, supplemented or modified.

 

“Legal Requirement” means any treaty, convention, statute, law, regulation,
ordinance, license, permit, governmental approval, injunction, judgment, order,
consent decree or other requirement of any Governmental Authority, whether
federal, state, or local.

 

“Lenders” means and includes Bank of Montreal and the other financial
institutions from time to time party to this Agreement, including each assignee
Lender pursuant to Section 12.12 hereof.

 

“Lending Office” is defined in Section 10.4 hereof.

 

“Letter of Credit” is defined in Section 1.3(a) hereof.

 

“LIBOR” is defined in Section 1.4(b) hereof.

 

“LIBOR Index Rate” is defined in Section 1.4(b) hereof.

 

“LIBOR Quoted Rate” is defined in Section 1.4(a) hereof.

 

“Lien” means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of a
vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.

 

“Loan” and “Loans” are defined in Section 1.1 hereof and, as so defined, include
a Base Rate Loan or a Eurodollar Loan, each of which is a “type” of Loan
hereunder.

 

“Loan Documents” means this Agreement, the Notes (if any), the Applications, the
Guaranties, if any, and each other instrument or document to be delivered
hereunder or thereunder or otherwise in connection therewith.

 

-35-

 

 

“Material Adverse Effect” means (a) a material adverse change in, or material
adverse effect upon, the operations, business, Property or condition (financial
or otherwise) of the Borrower and its Subsidiaries taken as a whole, (b) a
material impairment of the ability of the Borrower or any Guarantor to perform
its obligations under any Loan Document or (c) a material adverse effect upon
the legality, validity, binding effect or enforceability against the Borrower or
any Guarantor of any Loan Document or the rights and remedies of the
Administrative Agent and the Lenders thereunder.

 

“Moody’s” means Moody’s Investors Service, Inc., or any successor thereof.

 

“Note” and “Notes” are defined in Section 1.10 hereof.

 

“Obligations” means all obligations of the Borrower to pay principal and
interest on the Loans, all Reimbursement Obligations owing under the
Applications, all fees and charges payable hereunder, and all other payment
obligations of the Borrower or any Guarantor arising under or in relation to any
Loan Document, in each case whether now existing or hereafter arising, due or to
become due, direct or indirect, absolute or contingent, and howsoever evidenced,
held or acquired.

 

“Occupancy Rate” means for any Real Property, the percentage of the Sites of
such Real Property leased by Tenants pursuant to bona fide Leases, in each case,
which Tenants are not subject to a then continuing Bankruptcy Event, or if
subject to a then continuing Bankruptcy Event (i) the trustee in bankruptcy of
such Tenant shall have accepted and assumed such Lease or the Tenant shall be
not more than 60 days in arrears on base rental or other similar payments due
under the Leases; (ii) to the extent that the Tenant shall have filed, and the
bankruptcy court shall have approved, the Tenant’s plan for reorganization, the
Tenant shall be performing its obligations pursuant to the approved plan of
reorganization; or (iii) the status of such Tenant’s Lease shall be otherwise
reasonably acceptable to the Administrative Agent.

 

“OFAC” means the United States Department of Treasury Office of Foreign Assets
Control.

 

“OFAC Event” is defined in Section 8.13(c) hereof.

 

“OFAC Sanctions Programs” means all laws, regulations, and Executive Orders
administered by OFAC, including without limitation, the Bank Secrecy Act,
anti--money laundering laws (including, without limitation, the Patriot Act),
and all economic and trade sanction programs administered by OFAC, any and all
similar United States federal laws, regulations or Executive Orders (whether
administered by OFAC or otherwise), and any similar laws, regulations or orders
adopted by any State within the United States.

 

“OFAC SDN List” means the list of the Specially Designated Nationals and Blocked
Persons maintained by OFAC.

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

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“Other Recourse Debt” means, as of the date of determination, all Indebtedness
(including the face amount of all outstanding letters of credit) which is
recourse to, or has a deficiency guaranty provided by, the Borrower or any
Guarantor (directly or by a guaranty thereof, but without duplication), other
than with respect to the Loans, Hedging Liability, Bank Product Obligations and
other Obligations. For the avoidance of doubt, any guaranty by the Borrower or a
Guarantor pursuant to which customary carveouts to the non-recourse liability of
the primary obligor of the related indebtedness are guaranteed shall not
constitute Other Recourse Debt.

 

“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other
Connection Taxes imposed with respect to an assignment (other than an assignment
made pursuant to Section 1.13 hereof).

 

“Participating Interest” is defined in Section 1.3(e) hereof.

 

“Participating Lender” is defined in Section 1.3(e) hereof.

 

“Patriot Act” is defined in Section 7.2(m) hereof.

 

“PBGC” means the Pension Benefit Guaranty Corporation or any Person succeeding
to any or all of its functions under ERISA.

 

“Percentage” means, for each Lender, the percentage of the Commitments
represented by such Lender’s Commitment or, if the Commitments have been
terminated, the percentage held by such Lender (including through participation
interests in Reimbursement Obligations) of the aggregate principal amount of all
Loans and L/C Obligations then outstanding.

 

“Permitted Liens” means each of the following: (a) Liens for taxes, assessments
and governmental charges or levies to the extent not required to be paid under
Section 8.3; (b) Liens imposed by law, such as materialmen’s, mechanics’,
carriers’, workmen’s and repairmen’s Liens and other similar Liens arising in
the ordinary course of business securing obligations that are not overdue or
that are being contested in good faith and by proper proceedings and as to which
appropriate reserves are being maintained; (c) pledges or deposits to secure
obligations under workers’ compensation laws or similar legislation or to secure
public or statutory obligations; (d) easements, zoning restrictions, rights of
way and other encumbrances on title to real property that, in the aggregate, do
not materially and adversely affect the value of such real property or the use
of such real property for its present purposes; (e) deposits to secure the
performance of bids, trade contracts (other than for borrowed money), leases,
statutory obligations, surety and appeal bonds, performance bonds and other
obligations of like nature incurred in the ordinary course of business;
(f) Liens in favor of the United States of America for amounts paid to the
Borrower or any Guarantor as progress payments under government contracts
entered into by it; (g) attachment, judgment and other similar Liens arising in
connection with court, reference or arbitration proceedings, provided that the
same have been in existence less than twenty (20) days, that the same have been
discharged or that execution or enforcement thereof has been stayed pending
appeal; (h) the rights of tenants or lessees under leases or subleases not
interfering with the ordinary conduct of business of such Person; (i) Liens in
favor of the Administrative Agent for its benefit and/or the benefit of the
Lenders and the L/C Issuer; and (j) Liens on Real Properties that are not
Borrowing Base Properties.

 

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“Person” means an individual, partnership, corporation, limited liability
company, association, trust, unincorporated organization or any other entity or
organization, including a government or agency or political subdivision thereof.

 

“Plan” means any employee pension benefit plan covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Code that
either (a) is maintained by a member of the Controlled Group for employees of a
member of the Controlled Group or (b) is maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than one employer
makes contributions and to which a member of the Controlled Group is then making
or accruing an obligation to make contributions or has within the preceding five
plan years made contributions.

 

“Pro Forma Property NOI” means, with respect to any Real Property owned for
twelve (12) months or less, the aggregate amount of (i) Property Income minus
(ii) Property Expenses plus (ii) unusual or nonrecurring expenses associated
with the acquisition of such Real Property, in each case to the extent earned or
incurred during the period such Real Property has been owned by the Borrower or
a Guarantor, as applicable.

 

“Property” or “Properties” means, as to any Person, all types of real (including
the Real Property), personal, tangible, intangible or mixed property owned by
such Person whether or not included in the most recent balance sheet of such
Person and its subsidiaries under GAAP, including, as to the Borrower or any
Subsidiary, any Real Property owned by it.

 

“Property Expenses” means, as to any Real Property, the costs (including, but
not limited to, payroll, taxes, assessments, insurance, utilities, landscaping
and other similar charges) of operating and maintaining such Real Property,
which are the responsibility of the Borrower or the applicable Subsidiary that
are not paid directly by the applicable Tenant, but excluding depreciation,
amortization and interest costs.

 

“Property Income” means, as to any Real Property, cash rents (excluding non-cash
straight-line rent) and other cash revenues received by the Borrower or a
Subsidiary in the ordinary course for such Real Property, but excluding security
deposits and prepaid rent except to the extent applied in satisfaction of
applicable Tenants’ obligations for rent.

 

“Property NOI” means, with respect to any Real Property for any Rolling Period
(without duplication) the aggregate amount of (i) Property Income for such
period minus (ii) Property Expenses for such period.

 

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“Property Owner” means the Person who owns fee title interest in and to a Real
Property.

 

“Qualified ECP Guarantor” means, in respect of any Swap Obligation, each
Guarantor that has total assets exceeding $10,000,000 at the time the relevant
Guarantee or grant of the relevant security interest becomes effective with
respect to such Swap Obligation or such other person as constitutes an “eligible
contract participant” under the Commodity Exchange Act or any regulations
promulgated thereunder and can cause another person to qualify as an “eligible
contract participant” at such time by entering into a keepwell under Section
1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

“Rating” means the debt rating provided by S&P or Moody’s with respect to the
unsecured senior long-term non-credit enhanced debt of a Person.

 

“RCRA” means the Solid Waste Disposal Act, as amended by the Resource
Conservation and Recovery Act of 1976 and Hazardous and Solid Waste Amendments
of 1984, 42 U.S.C. §§6901 et seq., and any future amendments.

 

“Real Property” or “Real Properties” means the real property owned by the
Borrower or any of its Subsidiaries.

 

“Recipient” means (a) the Administrative Agent, (b) the L/C Issuer, and (c) any
Lender, as applicable.

 

“Reimbursement Obligation” is defined in Section 1.3(c) hereof.

 

“REIT Shares” is defined in Section 8.8(f) hereof.

 

“Release” means any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, leaching, migrating, dumping, or disposing
into the indoor or outdoor environment, including, without limitation, the
abandonment or discarding of barrels, drums, containers, tanks or other
receptacles containing or previously containing any Hazardous Material.

 

“Required Lenders” means, as of the date of determination thereof, at least two
(2) Lenders whose outstanding Loans, interests in Letters of Credit and Unused
Commitments constitute more than 66 2/3% of the sum of the total outstanding
Loans, interests in Letters of Credit, and Unused Commitments of the Lenders.

 

“Responsible Officer” means, with respect to the Borrower, the chief executive
officer, the chief financial officer, chief legal officer or the chief operating
officer of the Borrower or such Subsidiary.

 

“Revolving Credit” means the credit facility for making Loans and issuing
Letters of Credit described in Sections 1.1 and 1.3 hereof.

 

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“Revolving Credit Availability” means, as of any time the same is to be
determined, the amount (if any) by which (a) the lesser of (1) the Borrowing
Base as then determined and computed in accordance with this Agreement and (2)
the Revolving Credit Commitments as then in effect exceeds (b) the aggregate
principal amount of Loans and L/C Obligations then outstanding.

 

“Rolling Period” means, as of any date, the four Fiscal Quarters ending on or
immediately preceding such date.

 

“S&P” means Standard & Poor’s Ratings Services Group, a Standard & Poor’s
Financial Services LLC business.

 

“SEC” means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

 

“Site” means, with respect to any Real Property, each individual pad for a
manufactured home located on such Real Property.

 

“Stated Termination Date” means November 29, 2022.

 

“Stock” means shares of capital stock, beneficial or partnership interests,
participations or other equivalents (regardless of how designated) of or in a
corporation or equivalent entity, whether voting or non-voting, and includes,
without limitation, common stock, but excluding any preferred stock or other
preferred equity securities.

 

“Stock Equivalents” means all securities (other than Stock) convertible into or
exchangeable for Stock at the option of the holder, and all warrants, options or
other rights to purchase or subscribe for any stock, whether or not presently
convertible, exchangeable or exercisable.

 

“Subsidiary” means, as to any particular parent corporation or organization, any
other corporation or organization more than 50% of the outstanding Voting Stock
of which is at the time directly or indirectly owned by such parent corporation
or organization or by any one or more other entities which are themselves
subsidiaries of such parent corporation or organization. Unless otherwise
expressly noted herein, the term “Subsidiary” means a Subsidiary of the Borrower
or of any of its direct or indirect Subsidiaries.

 

“Swap Obligation” means, with respect to any Guarantor, any obligation to pay or
perform under any agreement, contract or transaction that constitutes a “swap”
within the meaning of section 1a(47) of the Commodity Exchange Act.

 

“Tangible Net Worth” means for each applicable period, total equity reflected on
the Borrower’s consolidated balance sheet as reported in its Form 10-K or 10-Q,
as applicable, less all amounts reported as assets on such consolidated balance
sheet in the event that the same constitute an intangible asset under GAAP.

 

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“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings (including back up withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax
or penalties applicable thereto.

 

“Tenant” means any Person leasing, subleasing or otherwise occupying any portion
of a Real Property under a Lease.

 

“Termination Date” means the earliest of (i) the Stated Termination Date, as
such date may be extended pursuant to Section 1.16, and (ii) the date on which
the Commitments are terminated in whole pursuant to Section 1.12, 9.2 or 9.3
hereof.

 

“Total Asset Value” means, as of any date of determination, an amount equal to
the sum of (a) for all Real Properties owned for twelve (12) months or more, the
quotient of (i) the consolidated Adjusted Property NOI from such Real Properties
for the most recent Rolling Period divided by (ii) the Capitalization Rate, plus
(b) for all Real Properties owned for less than twelve (12) months, the
aggregate purchase price of such Real Properties, plus (c) unrestricted cash,
unrestricted cash equivalents and marketable securities owned by the Borrower
and its Subsidiaries as of the end of such Rolling Period, plus (d) the par
value of mortgage note receivables reflected on the Borrower’s consolidated
balance sheet as reported in its Form 10-K or 10-Q, as applicable; provided that
the amount added to Total Asset Value for such mortgage note receivables shall
not exceed 10% of Total Asset Value, plus (e) the par value of inventory
consisting of manufactured homes for sale reflected on the Borrower’s
consolidated balance sheet as reported in its Form 10-K or 10-Q, as applicable;
provided that the amount added to Total Asset Value for such inventory shall not
exceed 5% of Total Asset Value, plus (f) the book value of investments permitted
under clauses (j), (k), (l) and (m) of Section 8.8, to the extent otherwise
permitted in this Agreement.

 

“Total Indebtedness” means, as of a given date, all liabilities of the Borrower
and its Subsidiaries which would, in conformity with GAAP, be properly
classified as a liability on a consolidated balance sheet of the Borrower and
its Subsidiaries as of such date, excluding any amounts categorized as accrued
expenses, accrued dividends, deposits held, deferred revenues, minority
interests and other liabilities not directly associated with the borrowing of
money.

 

“UCC” means the Uniform Commercial Code as in effect in the State of Illinois.

 

“Unfunded Vested Liabilities” means, for any Plan at any time, the amount (if
any) by which the present value of all vested nonforfeitable accrued benefits
under such Plan exceeds the fair market value of all Plan assets allocable to
such benefits, all determined as of the then most recent valuation date for such
Plan, but only to the extent that such excess represents a potential liability
of a member of the Controlled Group to the PBGC or the Plan under Title IV of
ERISA.

 

“Unused Commitments” means, at any time, the difference between the Commitments
then in effect and the aggregate outstanding principal amount of Loans and L/C
Obligations.

 

“U.S. Dollars” and “$” each means the lawful currency of the United States of
America.

 

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“U.S. Person” means any Person that is a “United States Person” as defined in
Section 7701(a)(30) of the Code.

 

“U.S. Tax Compliance Certificate” has the meaning assigned to such term in
subsection (f) of Section 12.1.

 

“Voting Stock” of any Person means capital stock or other equity interests of
any class or classes (however designated) having ordinary power for the election
of directors or other similar governing body of such Person, other than stock or
other equity interests having such power only by reason of the happening of a
contingency.

 

“Welfare Plan” means a “welfare plan” as defined in Section 3(1) of ERISA.

 

“Withholding Agent” means the Borrower, any Guarantor and the Administrative
Agent.

 

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

 

Section 5.2. Interpretation. The foregoing definitions are equally applicable to
both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words “include,” “includes” and “including” shall be deemed to
be followed by the phrase “without limitation.” The word “will” shall be
construed to have the same meaning and effect as the word “shall.” Unless the
context requires otherwise (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person’s successors and
assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement, (e) any reference to
any law or regulation herein shall, unless otherwise specified, refer to such
law or regulation as amended, modified or supplemented from time to time, and
(f) the words “asset” and “property” shall be construed to have the same meaning
and effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights. All
references to time of day herein are references to Chicago, Illinois, time
unless otherwise specifically provided. Where the character or amount of any
asset or liability or item of income or expense is required to be determined or
any consolidation or other accounting computation is required to be made for the
purposes of this Agreement, it shall be done in accordance with GAAP except
where such principles are inconsistent with the specific provisions of this
Agreement.

 

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Section 5.3. Change in Accounting Principles. If, after the date of this
Agreement there shall occur any change in GAAP from those used in the
preparation of the financial statements referred to in Section 6.5 hereof and
such change shall result in a change in the method of calculation of any
financial covenant, standard or term found in this Agreement, either the
Borrower or the Required Lenders may, by written notice to the Lenders and the
Borrower, respectively, require that the Lenders and the Borrower negotiate in
good faith to amend such covenants, standards, and terms so as equitably to
reflect such change in accounting principles, with the desired result being that
the criteria for evaluating the financial condition of the Borrower and its
Subsidiaries shall be the same as if such change had not been made. No delay by
the Borrower or the Required Lenders in requiring such negotiation shall limit
their right to so require such a negotiation at any time after such a change in
accounting principles. Until any such covenant, standard, or term is amended in
accordance with this Section 5.3, financial covenants shall be computed and
determined in accordance with GAAP in effect prior to such change in accounting
principles. Without limiting the generality of the foregoing, the Borrower shall
neither be deemed to be in compliance with any financial covenant hereunder nor
out of compliance with any financial covenant hereunder if such state of
compliance or noncompliance, as the case may be, would not exist but for the
occurrence of a change in accounting principles after the Closing Date.

 

Section 5.4. Divisions. For all purposes under the Loan Documents, in connection
with any division or plan of division (whether under Delaware law or any
comparable event under a different jurisdiction’s laws): (a) if any asset,
right, obligation or liability of any Person becomes the asset, right,
obligation or liability of a different Person, then it shall be deemed to have
been transferred from the original Person to the subsequent Person, and (b) if
any new Person comes into existence, such new Person shall be deemed to have
been organized on the first date of its existence by the holders of its equity
interests at such time.

 

Section 6. Representations and Warranties.

 

The Borrower represents and warrants to the Administrative Agent, the Lenders,
and the L/C Issuer as follows:

 

Section 6.1. Organization and Qualification. The Borrower is duly organized,
validly existing, and in good standing as a corporation under the laws of the
State of Maryland and operates as a qualified real estate investment trust under
Sections 856 through 860 of the Code. The Borrower has full and adequate power
to own its Property and conduct its business as now conducted, and is duly
licensed or qualified and in good standing in each jurisdiction in which the
nature of the business conducted by it or the nature of the Property owned or
leased by it requires such licensing or qualifying, except where the failure to
do so would not be reasonably expected to have a Material Adverse Effect.

 

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Section 6.2. Subsidiaries. Each Guarantor is duly organized, validly existing,
and in good standing under the laws of the jurisdiction in which it is
organized, has full and adequate power to own its Property and conduct its
business as now conducted, and is duly licensed or qualified and in good
standing in each jurisdiction in which the nature of the business conducted by
it or the nature of the Property owned or leased by it requires such licensing
or qualifying, except where the failure to do so would not be reasonably
expected to have a Material Adverse Effect. Schedule 6.2 hereto is a correct and
complete copy of the organizational chart of the Borrower and the Subsidiaries
as of the First Amendment Effective Date (including with respect to future
periods as to which this representation is required to be remade, as updated
from time to time as provided in Section 8.5(l)) and identifies the jurisdiction
of organization of the Borrower and each Subsidiary. All of the outstanding
shares of capital stock and other equity interests of each Subsidiary are
validly issued and outstanding and, with respect to Subsidiaries that are
corporations, fully paid and nonassessable, and all such shares and other equity
interests indicated on Schedule 6.2 as owned by the Borrower or a Subsidiary are
owned, beneficially and of record, by the Borrower or such Subsidiary free and
clear of all Liens (other than Permitted Liens). There are no outstanding
commitments or other obligations of any Subsidiary to issue, and no options,
warrants or other rights of any Person to acquire, any shares of any class of
capital stock or other equity interests of any Subsidiary.

 

Section 6.3. Authority and Validity of Obligations. The Borrower has full right
and authority to enter into this Agreement and the other Loan Documents executed
by it, to make the borrowings herein provided for and to perform all of its
obligations hereunder and under the other Loan Documents executed by it. Each
Guarantor has full right and authority to enter into the Loan Documents executed
by it, to guarantee the Obligations, Hedging Liability, and Bank Product
Obligations and to perform all of its obligations under the Loan Documents
executed by it. The Loan Documents delivered by the Borrower and each Guarantor
have been duly authorized, executed, and delivered by such Persons and
constitute valid and binding obligations of the Borrower and each Guarantor
enforceable against them in accordance with their terms, except as
enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance
or similar laws affecting creditors’ rights generally and general principles of
equity (regardless of whether the application of such principles is considered
in a proceeding in equity or at law); and this Agreement and the other Loan
Documents do not, nor does the performance or observance by the Borrower or any
Guarantor of any of the matters and things herein or therein provided for,
(a) contravene or constitute a default under any provision of law or any
judgment, injunction, order or decree binding upon the Borrower or any Guarantor
or any provision of the organizational documents (e.g., charter, certificate or
articles of incorporation and by-laws, certificate or articles of association
and operating agreement, partnership agreement, or other similar organizational
documents) of the Borrower or any Guarantor, (b) contravene or constitute a
default under any covenant, indenture or agreement of or affecting the Borrower
or any Guarantor or any of their Property, in each case where such contravention
or default, individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect, or (c) result in the creation or imposition of
any Lien on any Property of the Borrower or any Guarantor (other than in favor
of the Administrative Agent for its benefit and/or the benefit of the Lenders
and the L/C Issuer).

 

Section 6.4. Use of Proceeds; Margin Stock. The Borrower shall use the proceeds
of the Revolving Credit to refinance existing indebtedness, to fund
acquisitions, to finance capital expenditures, real estate related investments
and working capital, and for such other legal and proper purposes as are
consistent with all applicable Legal Requirements. Neither the Borrower nor any
Guarantor is engaged in the business of extending credit for the purpose of
purchasing or carrying margin stock (within the meaning of Regulation U of the
Board of Governors of the Federal Reserve System), and no part of the proceeds
of any Loan or any other extension of credit made hereunder will be used to
purchase or carry any such margin stock or to extend credit to others for the
purpose of purchasing or carrying any such margin stock. Margin stock (as
hereinabove defined) constitutes less than 25% of the assets of the Borrower and
the Guarantors.

 

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Section 6.5. Financial Reports. The consolidated balance sheet of the Borrower
and its Subsidiaries as of December 31, 2016, and the related consolidated
statements of income, retained earnings and cash flows of the Borrower and its
Subsidiaries for the Fiscal Year then ended, and accompanying notes thereto,
which financial statements are accompanied by the unqualified audit report of
independent public accountants heretofore furnished to the Administrative Agent
and the Lenders, fairly present the consolidated financial condition of the
Borrower and its Subsidiaries as at said dates and the consolidated results of
their operations and cash flows for the periods then ended in conformity with
GAAP applied on a consistent basis. To the Borrower’s knowledge, neither the
Borrower nor any Subsidiary has contingent liabilities which are material to it
and are required to be set forth in its financial statements or notes thereto in
accordance with GAAP other than as indicated on such financial statements and
notes thereto (including with respect to future periods as to which this
representation is required to be remade, on the financial statements furnished
pursuant to Section 8.5 hereof.

 

Section 6.6. No Material Adverse Change. Since December 31, 2017, there has been
no change in the condition (financial or otherwise) of the Borrower or any
Subsidiary except those occurring in the ordinary course of business, none of
which individually or in the aggregate could reasonably be expected to have a
Material Adverse Effect.

 

Section 6.7. Full Disclosure. The statements and information furnished to the
Administrative Agent and the Lenders in connection with the negotiation of this
Agreement and the other Loan Documents and the commitments by the Lenders to
provide all or part of the financing contemplated hereby do not contain any
untrue statements of a material fact or omit a material fact necessary to make
the material statements contained herein or therein, not misleading, the
Administrative Agent and the Lenders acknowledging that as to any projections
furnished to the Administrative Agent and the Lenders, the Borrower only
represents that the same were prepared on the basis of information and estimates
the Borrower believed to be reasonable. As of the First Amendment Effective
Date, the information included in the Beneficial Ownership Certification is true
and correct in all respects.

 

Section 6.8. Trademarks, Franchises, and Licenses. The Borrower and its
Subsidiaries own, possess, or have the right to use all necessary patents,
licenses, franchises, trademarks, trade names, trade styles, copyrights, trade
secrets, know how, and confidential commercial and proprietary information
necessary to conduct their businesses as now conducted, without known conflict
with any patent, license, franchise, trademark, trade name, trade style,
copyright or other proprietary right of any other Person, in each case, where
the failure to own, possess or have such rights could reasonably be expected to
have a Material Adverse Effect.

 

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Section 6.9. Governmental Authority and Licensing. The Borrower and its
Subsidiaries have received all licenses, permits, and approvals of all federal,
state, and local governmental authorities, if any, necessary to conduct their
businesses, in each case where the failure to obtain or maintain the same could
reasonably be expected to have a Material Adverse Effect. No investigation or
proceeding, which, if adversely determined, could reasonably be expected to
result in revocation or denial of any material license, permit or approval, is
pending or, to the knowledge of the Borrower, threatened.

 

Section 6.10. Good Title. The Borrower and its Subsidiaries have good and
defensible title (or valid leasehold interests) to their assets as reflected on
the most recent consolidated balance sheet of the Borrower and its Subsidiaries
furnished to the Administrative Agent and the Lenders (except for sales of
assets in the ordinary course of business), except to the extent the failure to
have such good and defensible title (or valid leasehold interests) could not
reasonably be expected to have a Material Adverse Effect. The assets owned by
the Borrower and each Guarantor are subject to no Liens, other than Permitted
Liens.

 

Section 6.11. Litigation and Other Controversies. There is no litigation or
governmental or arbitration proceeding or labor controversy pending, nor to the
knowledge of the Borrower threatened, against the Borrower or any Subsidiary or
any of their Property which if adversely determined, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.

 

Section 6.12. Taxes. All material tax returns required to be filed by the
Borrower or any Subsidiary in any jurisdiction have, in fact, been filed, and
all taxes, assessments, fees, and other governmental charges upon the Borrower
or any Subsidiary or upon any of its Property, income or franchises, which are
shown to be due and payable in such returns, have been paid, except such taxes,
assessments, fees and governmental charges, if any, as are being contested in
good faith and by appropriate proceedings which prevent enforcement of the
matter under contest and as to which adequate reserves established in accordance
with GAAP have been provided, except where the failure to pay such taxes,
assessments, fees and other governmental charges could not reasonably be
expected to have a Material Adverse Effect. The Borrower does not know of any
proposed additional tax assessment against the Borrower or its Subsidiaries for
which adequate provisions in accordance with GAAP have not been made on their
accounts. Adequate provisions in accordance with GAAP for taxes on the books of
the Borrower and each Subsidiary have been made for all open years, and for its
current fiscal period.

 

Section 6.13. Approvals. Except those already received, no authorization,
consent, license or exemption from, or filing or registration with, any court or
governmental department, agency or instrumentality, nor any approval or consent
of any other Person, is or will be necessary to the valid execution, delivery or
performance by the Borrower or any Guarantor of any Loan Document.

 

Section 6.14. Affiliate Transactions. Except as permitted by Section 8.14
hereof, none of the Borrower or any Subsidiary is a party to any contracts or
agreements with any of its Affiliates on terms and conditions which are less
favorable to the Borrower or such Subsidiary than would be usual and customary
in similar contracts or agreements between Persons not affiliated with each
other.

 

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Section 6.15. Investment Company. Neither the Borrower nor any Subsidiary is an
“investment company” or a company “controlled” by an “investment company” within
the meaning of the Investment Company Act of 1940, as amended.

 

Section 6.16. ERISA. The Borrower and each other member of its Controlled Group
has fulfilled its obligations under the minimum funding standards of and is in
compliance in all material respects with ERISA and the Code to the extent
applicable to it and has not incurred any liability to the PBGC or a Plan under
Title IV of ERISA other than a liability to the PBGC for premiums under
Section 4007 of ERISA where any such failure to fulfill its obligations,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect. None of the Borrower or any Subsidiary has any material
contingent liabilities with respect to any post-retirement benefits under a
Welfare Plan, other than liability for continuation coverage described in
article 6 of Title I of ERISA.

 

Section 6.17. Compliance with Laws. (a) The Borrower and its Subsidiaries are in
compliance with the requirements of all Legal Requirements applicable to or
pertaining to their Property or business operations (including, without
limitation, the Occupational Safety and Health Act of 1970, the Americans with
Disabilities Act of 1990, zoning regulations and laws and regulations
establishing quality criteria and standards for air, water, land and toxic or
hazardous wastes and substances), where any such non-compliance, individually or
in the aggregate, could reasonably be expected to have a Material Adverse
Effect.

 

(b) Without limiting the representations and warranties set forth in
Section 6.17(a) above, except for such matters, individually or in the
aggregate, which could not reasonably be expected to result in a Material
Adverse Effect, the Borrower represents and warrants that: (i) the Borrower and
its Subsidiaries, and each of the Real Properties, comply in all material
respects with all applicable Environmental Laws; (ii) the Borrower and its
Subsidiaries have obtained all governmental approvals required for their
operations and each of the Real Properties by any applicable Environmental Law;
(iii) the Borrower and its Subsidiaries have not, and the Borrower has no
knowledge of any other Person who has, caused any Release, threatened Release or
disposal of any Hazardous Material at, on, about, or off any of the Real
Properties in any material quantity (other than to the extent remediated in
accordance with applicable Environmental Laws) and, to the knowledge of the
Borrower, none of the Real Properties are adversely affected by any Release,
threatened Release or disposal of a Hazardous Material originating or emanating
from any other property; (iv) the Borrower and its Subsidiaries have no notice
or knowledge that the Real Properties contain or have contained any: (1) other
than to the extent remediated in accordance with applicable Environmental Laws,
underground storage tank or material amounts of asbestos containing building
material, (2) landfills or dumps, (3) hazardous waste management facility as
defined pursuant to RCRA or any comparable state law (other than any private
sewage treatment plant maintained at any Real Property in compliance with
Environmental Laws), or (4) site on or nominated for the National Priority List
promulgated pursuant to CERCLA or any state remedial priority list promulgated
or published pursuant to any comparable state law; (v) the Borrower and its
Subsidiaries have not used a material quantity of any Hazardous Material and
have conducted no Hazardous Material Activity at any of the Real Properties;
(vi) the Borrower and its Subsidiaries have no material liability for response
or corrective action, natural resource damage or other harm pursuant to CERCLA,
RCRA or any comparable state law; (vii) the Borrower and its Subsidiaries are
not subject to, have no notice or knowledge of and are not required to give any
notice of any Environmental Claim involving the Borrower or any Subsidiary or
any of the Real Properties, and there are no conditions or occurrences at any of
the Real Properties which could reasonably be anticipated to form the basis for
an Environmental Claim against the Borrower or any Subsidiary or such Real
Properties; (viii) none of the Real Properties are subject to any, and the
Borrower has no knowledge of any imminent restriction on the ownership,
occupancy, use or transferability of the Real Properties in connection with any
(1) Environmental Law or (2) Release, threatened Release or disposal of a
Hazardous Material, which would affect the lawful use of any such Real Property
as currently used; and (ix) there are no conditions or circumstances at any of
the Real Properties which pose an unreasonable risk to the environment or the
health or safety of Persons.

 

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(c) The Borrower and each of its Subsidiaries is in material compliance with all
Anti-Corruption Laws. The Borrower and each of its Subsidiaries has implemented
and maintains in effect policies and procedures designed to ensure compliance by
the Borrower, its Subsidiaries and their respective directors, officers,
employees and agents with Anti-Corruption Laws. Neither the Borrower nor any
Subsidiary has made a payment, offering, or promise to pay, or authorized the
payment of, money or anything of value (a) in order to assist in obtaining or
retaining business for or with, or directing business to, any foreign official,
foreign political party, party official or candidate for foreign political
office, (b) to a foreign official, foreign political party or party official or
any candidate for foreign political office, and (c) with the intent to induce
the recipient to misuse his or her official position to direct business
wrongfully to the Borrower or such Subsidiary or to any other Person, in
violation of any Anti-Corruption Laws.

 

Section 6.18. OFAC (a) The Borrower is in compliance with the requirements of
all OFAC Sanctions Programs applicable to it, (b) each Subsidiary is in
compliance with the requirements of all OFAC Sanctions Programs applicable to
such Subsidiary, (c) the Borrower has provided to the Administrative Agent, the
L/C Issuer, and the Lenders all information requested by them regarding the
Borrower, the Subsidiaries and other Affiliates of the Borrower necessary for
the Administrative Agent, the L/C Issuer, and the Lenders to comply with all
applicable OFAC Sanctions Programs, and (d) to the Borrower’s knowledge, neither
the Borrower nor any of the Subsidiaries or other Affiliates of the Borrower is,
as of the Closing Date, named on the current OFAC SDN List.

 

Section 6.19. Other Agreements. Neither the Borrower nor any Subsidiary is in
default under the terms of any covenant, indenture or agreement of or affecting
such Person or any of its Property, which default, if uncured, could reasonably
be expected to have a Material Adverse Effect.

 

Section 6.20. Solvency. The Borrower and its Subsidiaries, taken as a whole, are
solvent, able to pay their debts as they become due, and have sufficient capital
to carry on their business as presently conducted and all businesses (if any)
which are currently contemplated to be undertaken by them.

 

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Section 6.21. No Default. No Default or Event of Default has occurred and is
continuing.

 

Section 6.22. No Broker Fees. No broker’s or finder’s fee or commission owing to
any broker or finder engaged by the Borrower or any Subsidiary will be payable
with respect hereto or any of the transactions contemplated thereby; and the
Borrower hereby agrees to indemnify the Administrative Agent and the Lenders
against, and agrees that it will hold the Administrative Agent and the Lenders
harmless from, any such claim, demand, or liability for any such broker’s or
finder’s fees alleged to have been incurred by the Borrower in connection
herewith or therewith and any expenses (including reasonable attorneys’ fees)
arising in connection with any such claim, demand, or liability.

 

Section 6.23. Condition of Property; Casualties; Condemnation. Except to the
extent that the same could not reasonably be expected to result in a Material
Adverse Effect, each Real Property, in all material respects (a) is in good
repair, working order and condition, normal wear and tear excepted, (b) is free
of material structural defects, (c) is not subject to material deferred
maintenance, (d) has and will have all building systems contained therein in
good repair, working order and condition, normal wear and tear excepted and (e)
is not located in a flood plain or flood hazard area, or if located in a flood
plain or flood hazard area is covered by full replacement cost flood insurance.
For the avoidance of doubt, in no event shall the representations contained in
the foregoing clause (a) through (d) be deemed to be applicable to any Property
owned by a Tenant. None of the Real Properties is currently adversely affected
as a result of any fire, explosion, earthquake, flood, drought, windstorm,
accident, strike or other labor disturbance, embargo, requisition or taking of
property or cancellation of contracts, permits or concessions by a Governmental
Authority, riot, activities of armed forces or acts of God or of any public
enemy which is not in the process of being repaired in any case in which such
conditions, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect. No condemnation or other like proceedings
that has had, or could reasonably be expected to result in, a Material Adverse
Effect, is pending, served or, to the knowledge of the Borrower, threatened
against any Real Property. Promptly after the reasonable request of the
Administrative Agent, the Borrower shall deliver a current property condition
report, in form and substance reasonably acceptable to Administrative Agent from
an independent engineering or architectural firm reasonably acceptable to
Administrative Agent, with respect to any Borrowing Base Property specified by
Administrative Agent that, in the reasonable determination of the Administrative
Agent, has a material maintenance or structural issue that would materially and
adversely affect the value or use of such Eligible Property; provided that the
Administrative Agent shall be entitled to make only one (1) such request during
the term of this Agreement unless an Event of Default has occurred and is
continuing.

 

Section 7. Conditions Precedent.

 

Section 7.1. All Credit Events. At the time of each Credit Event:

 

(a) each of the representations and warranties set forth herein and in the other
Loan Documents shall be and remain true and correct in all material respects
(where not already qualified by materiality, otherwise in all respects) as of
said time, except to the extent the same expressly relate to an earlier date, in
which case the same shall be true and correct in all material respects (where
not already qualified by materiality, otherwise in all respects) as of such
earlier date;

 

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(b) no Default or Event of Default shall have occurred and be continuing or
would occur as a result of such Credit Event and, after giving effect to such
extension of credit, the Revolving Credit Availability, as then determined and
computed, shall be no less than $0;

 

(c) in the case of a Borrowing, the Administrative Agent shall have received the
notice required by Section 1.6 hereof, and the L/C Issuer shall have received
(i) in the case of the issuance of any Letter of Credit, a duly completed
Application for such Letter of Credit together with any fees called for by
Section 2.1 hereof, and (ii) in the case of an extension or increase in the
amount of a Letter of Credit, a written request therefore, in a form reasonably
acceptable to the L/C Issuer, together with any fees called for by Section 2.1
hereof; and

 

(d) such Credit Event shall not violate any order, judgment or decree of any
court or other authority or any provision of law or regulation applicable to the
Administrative Agent, the L/C Issuer or any Lender (including, without
limitation, Regulation U of the Board of Governors of the Federal Reserve
System) as then in effect.

 

Each request for a Borrowing hereunder and each request for the issuance of,
increase in the amount of, or extension of the expiration date of, a Letter of
Credit shall be deemed to be a representation and warranty by the Borrower on
the date on such Credit Event as to the facts specified in subsections (a)
through (c), inclusive, of this Section 7.1; provided, however, that the Lenders
may continue to make advances under the Revolving Credit, in the sole discretion
of the Lenders, notwithstanding the failure of the Borrower to satisfy one or
more of the conditions set forth above and any such advances so made shall not
be deemed a waiver of any Default or Event of Default or other condition set
forth above that may then exist.

 

Section 7.2. Initial Credit Event. Before or concurrently with the initial
Credit Event:

 

(a) the Administrative Agent shall have received this Agreement duly executed by
the Borrower, each Guarantor, the L/C Issuer, and the Lenders;

 

(b) if requested by any Lender, the Administrative Agent shall have received,
for such Lender, a duly executed Note of the Borrower dated the Closing Date and
otherwise in compliance with the provisions of Section 1.10 hereof;

 

(c) the Administrative Agent shall have received evidence of insurance required
to be maintained under the Loan Documents;

 

(d) the Administrative Agent shall have received copies of the Borrower’s and
each Guarantor’s articles of incorporation and bylaws (or comparable
organizational documents) and any amendments thereto, certified in each instance
by an authorized officer of the Borrower (on behalf of itself and in its
capacity as a direct or indirect owner of each Guarantor);

 

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(e) the Administrative Agent shall have received copies of resolutions
authorizing the execution, delivery and performance by the Borrower and each
Guarantor of this Agreement and the other Loan Documents to which it is a party
and the consummation of the transactions contemplated hereby and thereby,
together with specimen signatures of the persons authorized to execute such
documents on the Borrower’s and each Guarantor’s behalf, all certified in each
instance by an authorized officer of the Borrower (on behalf of itself and in
its capacity as a direct or indirect owner of each Guarantor);

 

(f) the Administrative Agent shall have received copies of the certificates of
good standing for the Borrower and each Guarantor (dated no earlier than thirty
(30) days prior to the Closing Date) from the office of the secretary of the
state (or similar office) of its incorporation or organization and of each state
in which an Initial Borrowing Base Property is located;

 

(g) the Administrative Agent shall have received a list of the Borrower’s
Authorized Representatives;

 

(h) the Administrative Agent shall have received the initial fees called for by
Section 2.1 hereof;

 

(i) the capital and organizational structure of the Borrower and its
Subsidiaries shall be reasonably satisfactory to the Administrative Agent;

 

(j) the Administrative Agent shall have received (i) a pro forma Compliance
Certificate calculated as of the Closing Date; and (ii) a Borrowing Base
Certificate showing computation of the Revolving Credit Availability with the
inclusion of the Initial Borrowing Base Properties, each in form and substance
acceptable to the Administrative Agent;

 

(k) the Administrative Agent shall have received a fully executed Internal
Revenue Service Form W-9 for the Borrower and each Guarantor; and the
Administrative Agent and the Borrower shall have received the Internal Revenue
Service Forms and any applicable attachments required by Section 12.1(b);

 

(l) the Administrative Agent shall have received such other agreements,
instruments, documents, certificates, and opinions as the Administrative Agent
may reasonably request;

 

(m) the Administrative Agent and any Lender shall have received any information
or materials reasonably required by the Administrative Agent or such Lender in
order to assist the Administrative Agent or such Lender in maintaining
compliance with (i) the USA Patriot Act (Title III of Pub. L. 107-56 (signed
into law October 26, 2001)) (the “Patriot Act”) and (ii) any applicable “know
your customer” or similar rules and regulations; and

 

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(n) if the Borrower qualifies as a “legal entity customer” under the Beneficial
Ownership Regulation, it shall deliver a Beneficial Ownership Certification in
relation to it.

 

Section7.3. Eligible Property Additions and Deletions to the Borrowing Base. As
of the First Amendment Effective Date, the Borrower represents and warrants to
the Lenders and the Administrative Agent that the Initial Borrowing Base
Properties qualify as Eligible Properties and that the information provided on
Schedule 1.1 is true and correct.

 

In the event that any Borrowing Base Property shall at any time cease to
constitute an Eligible Property (including, for the sake of clarity, due to any
division or plan of division (whether under Delaware law or any comparable event
under a different jurisdiction’s laws) of the Subsidiary that owned such
Borrowing Base Property which results in the owner of such Borrowing Base
Property not being a Guarantor), (i) the Borrower shall, as soon as reasonably
possible after obtaining knowledge thereof, notify the Administrative Agent in
writing of the same and (ii) such Real Property shall automatically cease to
constitute a Borrowing Base Property from the date that the same ceased to
constitute an Eligible Property (and the Property NOI of such Real Property
shall therefore be excluded from the calculation of Borrowing Base NOI) until
such time as the same again qualifies as an Eligible Property and is added by
the Borrower as a Borrowing Base Property in accordance with the next succeeding
paragraph. Similarly, in the event that, at any time, the Borrowing Base
Requirements shall be violated, (A) the Borrower shall, as soon as reasonably
possible after obtaining knowledge thereof, notify the Administrative Agent in
writing of the same, which written notice shall include a designation by the
Borrower of the Real Property or Real Properties to be deleted as Borrowing Base
Properties in order to restore compliance with the Borrowing Base Requirements,
and (B) each such Real Property shall automatically cease to constitute a
Borrowing Base Property from the date of such written notice (and the Property
NOI of such Real Property shall therefore be excluded from the calculation of
Borrowing Base NOI) until such time as the same is added by the Borrower as a
Borrowing Base Property in accordance with the next succeeding paragraph
(provided that the addition of the same at such time does not result in a
violation of the Borrowing Base Requirements).

 

Upon not less than ten (10) Business Days prior written notice from the Borrower
to the Administrative Agent, the Borrower may, from time to time, designate that
a Real Property be added (subject to the other requirements for a Real Property
qualifying as an Eligible Property) or deleted as a Borrowing Base Property.
Such notice shall be accompanied by a Borrowing Base Certificate setting forth
the components of the Borrowing Base as of the addition or deletion of the
designated Real Property as a Borrowing Base Property, and with respect to a
deletion (including, for the sake of clarity, a deletion resulting from any
division or plan of division (whether under Delaware law or any comparable event
under a different jurisdiction’s laws) of the Subsidiary that owned such Real
Property), Borrower’s certification in such detail as reasonably required by the
Administrative Agent that no Default or Event of Default is then continuing
(including after taking into account the deletion of such Borrowing Base
Property) and that such deletion shall not cause the other Borrowing Base
Properties to violate the Borrowing Base Requirements. No addition of a Real
Property as a Borrowing Base Property shall be permitted unless it adds not less
than $2,000,000 to the then-existing Borrowing Base Value, and all such
additions shall be subject to reasonable approval by the Administrative Agent.

 

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Notwithstanding anything contained in this Agreement to the contrary, the
Administrative Agent with the consent of the Required Lenders in their
discretion may, at the Borrower’s request, allow a Real Property to qualify as
an Eligible Property despite the failure of such Real Property to otherwise
qualify as an Eligible Property.

 

Upon the deletion of a Real Property as a Borrowing Base Property (whether
automatically or as a result of an election by the Borrower, as described
above), the Guarantor which owned such Real Property, but that does not
otherwise own any other Borrowing Base Property, shall, upon the Borrower’s
written request, be released from its obligations under this Agreement or, if
applicable, its separate Guaranty pursuant to documentation reasonably
acceptable to the Borrower and the Administrative Agent.

 

Section 8. Covenants.

 

The Borrower and, to the extent provided below, each Guarantor agrees that, so
long as any credit is available to or in use by the Borrower hereunder, except
to the extent compliance in any case or cases is cured or waived in writing
pursuant to the terms of Section 12.13 hereof:

 

Section 8.1. Maintenance of Existence. (i) The Borrower shall, and shall cause
each Guarantor to, preserve and maintain its existence, except as otherwise
provided in Section 8.10(c) hereof. The Borrower shall, and shall cause each
Guarantor to, preserve and keep in force and effect all licenses, permits,
franchises, approvals, patents, trademarks, trade names, trade styles,
copyrights, and other proprietary rights necessary to the proper conduct of its
business, except where the failure to do so could not reasonably be expected to
have a Material Adverse Effect.

 

(ii) (a) At least one class of common stock of the Borrower shall at all times
be duly listed on the New York Stock Exchange, Inc., the NYSE Amex or The NASDAQ
Stock Market and (b) the Borrower shall timely file all reports required to be
filed by it with the New York Stock Exchange, Inc., the NYSE Amex or The NASDAQ
Stock Market, as applicable, and the Securities and Exchange Commission.

 

Section 8.2. Maintenance of Properties. The Borrower shall, and shall cause each
Guarantor to, maintain, preserve, and keep all of its Property in working
condition and order (ordinary wear and tear and damage by casualty excepted),
and the Borrower and each Guarantor shall, from time to time, make all necessary
repairs, renewals, replacements, additions, and betterments to its Property so
that such Property shall at all times be fully preserved and maintained, except
(i) to the extent that, in the reasonable business judgment of such Person, any
such Property is no longer necessary for the proper conduct of the business of
such Person and (ii) where the failure to do so could not reasonably be expected
to have, either individually or in the aggregate, a Material Adverse Effect. The
Borrower shall not, and shall not permit any Guarantor to, amend, modify or
terminate any material contract or agreement to which it is a party if such
amendment, modification or termination or waiver could reasonably be expected to
cause a Material Adverse Effect.

 

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Section 8.3. Taxes and Assessments. The Borrower and each Guarantor shall, or
shall cause its Tenants to, duly pay and discharge all taxes, rates,
assessments, fees, and governmental charges upon or against it or its Property,
in each case before the same become delinquent and before penalties accrue
thereon, unless and to the extent that the same are being contested in good
faith and by appropriate proceedings which prevent enforcement of the matter
under contest and adequate reserves are provided therefor.

 

Section 8.4. Insurance. The Borrower shall insure and keep insured, and shall
cause each Subsidiary to insure and keep insured, with good and responsible
insurance companies all insurable Property owned by it which is of a character
usually insured by Persons similarly situated and operating like Properties
against loss or damage from such hazards and risks (including flood insurance
with respect to any improvements on real Property consisting of building or
parking facilities in an area designated by a governmental body as having
special flood hazards), and in such amounts, as are insured by Persons similarly
situated and operating like Properties; and the Borrower shall insure, and shall
cause each Subsidiary to insure, such other hazards and risks (including,
without limitation, business interruption, employers’ and public liability
risks) with good and responsible insurance companies as and to the extent
usually insured by Persons similarly situated and conducting similar businesses.
The Borrower shall, upon the request of the Administrative Agent, furnish to the
Administrative Agent and the Lenders a certificate setting forth in summary form
the nature and extent of the insurance maintained pursuant to this Section 8.4.

 

Section 8.5. Financial Reports. The Borrower shall, and shall cause each
Subsidiary to, maintain a standard system of accounting in accordance with GAAP
and shall furnish to the Administrative Agent, each Lender, the L/C Issuer and
each of their duly authorized representatives such information respecting the
business and financial condition of the Borrower and each Subsidiary as the
Administrative Agent or such Lender may reasonably request; and without any
request, shall furnish to the Administrative Agent for distribution to the
Lenders and L/C Issuer:

 

(a) as soon as available, and in any event no later than ninety (90) days after
the last day each Fiscal Year of the Borrower (commencing with the 2017 Fiscal
Year), a copy of the consolidated balance sheet of the Borrower and its
Subsidiaries as of the last day of the Fiscal Year then ended and the
consolidated statements of income, retained earnings, and cash flows of the
Borrower and its Subsidiaries for the Fiscal Year then ended, and accompanying
notes thereto, each in reasonable detail showing in comparative form the figures
for the previous Fiscal Year, accompanied by an unqualified opinion of
independent public accountants of recognized national standing, selected by the
Borrower and reasonably satisfactory to the Administrative Agent (the
Administrative Agent hereby approving PFK O’Connor Davies, the independent
public accountants engaged by the Borrower as of the Closing Date), to the
effect that the consolidated financial statements have been prepared in
accordance with GAAP and present fairly in all material respects in accordance
with GAAP the consolidated financial condition of the Borrower and its
Subsidiaries as of the close of such Fiscal Year and the results of their
operations and cash flows for the Fiscal Year then ended and that an examination
of such accounts in connection with such financial statements has been made in
accordance with generally accepted auditing standards and, accordingly, such
examination included such tests of the accounting records and such other
auditing procedures as were considered necessary in the circumstances;

 

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(b) within the period provided in subsection (a) above, the written statement of
the accountants who certified the audit report thereby required that in the
course of their audit they have obtained no knowledge of any Default or Event of
Default, or, if such accountants have obtained knowledge of any such Default or
Event of Default, they shall disclose in such statement the nature and period of
the existence thereof;

 

(c) as soon as available, and in any event no later than forty-five (45) days
after the last day of each of the first three Fiscal Quarters of each Fiscal
Year of the Borrower (commencing with the Fiscal Quarter ending on June 30,
2017), a copy of the consolidated balance sheet of the Borrower and its
Subsidiaries as of the last day of such Fiscal Quarter and the consolidated
statements of income, retained earnings, and cash flows of the Borrower and its
Subsidiaries for the Fiscal Quarter and for the Fiscal Year-to-date period then
ended, each in reasonable detail showing, in comparative form, the figures for
the corresponding date and period in the previous Fiscal Year, prepared by the
Borrower in accordance with GAAP (subject to the absence of footnote disclosures
and year-end audit adjustments) and certified to by its chief financial officer
or another officer of the Borrower reasonably acceptable to the Administrative
Agent;

 

(d) as soon as available, and in any event within (i) forty-five (45) days after
the last day of each of the first three Fiscal Quarters of each Fiscal Year
(commencing with the Fiscal Quarter ending on June 30, 2017) and (ii) ninety
(90) days after the last day of the last Fiscal Quarter of each Fiscal Year
(commencing with the 2017 Fiscal Year), a Borrowing Base Certificate showing the
computation of the Borrowing Base in reasonable detail as of the close of
business on the last day of such Fiscal Quarter, prepared by the Borrower and
certified to by its chief financial officer or another officer of the Borrower
reasonably acceptable to the Administrative Agent;

 

(e) with each of the financial statements delivered pursuant to subsections (a)
and (c) above, a compliance certificate (“Compliance Certificate”) in the form
attached hereto as Exhibit E signed by the chief financial officer of the
Borrower or another officer of the Borrower reasonably acceptable to the
Administrative Agent to the effect that to such officer’s knowledge and belief
no Default or Event of Default has occurred during the period covered by such
statements or, if any such Default or Event of Default has occurred during such
period, setting forth a description of such Default or Event of Default and
specifying the action, if any, taken or being taken by the Borrower or any
Subsidiary to remedy the same. Such certificate shall also set forth the
calculations supporting such statements in respect of Section 8.20 hereof;

 

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(f) promptly after receipt thereof, any additional written reports, management
letters or other detailed information contained in writing concerning
significant aspects of the Borrower’s or any Subsidiary’s operations and
financial affairs given to it by its independent public accountants;

 

(g) promptly after the sending or filing thereof, copies of each financial
statement, report, notice or proxy statement sent by the Borrower or any
Subsidiary to its stockholders or other equity holders, and upon written request
from the Administrative Agent, copies of each regular, periodic or special
report, registration statement or prospectus (including all Form 10-K, Form 10-Q
and Form 8-K reports) filed by the Borrower or any Subsidiary with any
securities exchange or the Securities and Exchange Commission or any successor
agency;

 

(h) promptly after receipt thereof, a copy of each audit made by any regulatory
agency of the books and records of the Borrower or any Subsidiary or of notice
of any material noncompliance with any applicable Legal Requirements relating to
the Borrower or any Subsidiary, or its business;

 

(i) as soon as available, and in any event within thirty (30) days after the end
of each Fiscal Year of the Borrower, a copy of the Borrower’s budget for the
following year including consolidated projections of revenues, expenses and
balance sheet on a quarter-by-quarter basis, with such projections in reasonable
detail prepared by the Borrower and in form satisfactory to the Administrative
Agent (which shall include a summary of all significant assumptions made in
preparing such budget);

 

(j) notice of any Change of Control;

 

(k) promptly after any Responsible Officer of the Borrower obtaining knowledge
thereof, written notice of (i) any threatened (in writing) or pending litigation
or governmental or arbitration proceeding or labor controversy against the
Borrower or any Subsidiary or any of their Property which could reasonably be
expected to have a Material Adverse Effect, (ii) the occurrence of any other
matter which could reasonably be expected to have a Material Adverse Effect or
(iii) the occurrence of any Default or Event of Default;

 

(l) with each of the financial statements delivered pursuant to subsections (a)
and (c) above, if there have been any changes to the organizational chart of the
Borrower and the Subsidiaries during the most recently ended Fiscal Quarter, a
revised organizational chart, together with a summary of the changes;

 

(m) promptly after any Responsible Officer of the Borrower obtaining knowledge
thereof, written notice of any change in the information provided in the
Beneficial Ownership Certification that would result in a change to the list of
beneficial owners identified in parts (c) or (d) of such certification; and

 

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(n) promptly after the request of any Lender, any other information or report
reasonably requested by a Lender provided that any such requested information or
report is available or can be generated by the Borrower using commercially
reasonable efforts;

 

provided, however, to the extent such items set forth above are filed with the
Securities and Exchange Commission or otherwise are publicly available, the
Borrower shall be deemed to have satisfied this covenant once it provides notice
to the Administrative Agent of such availability.

 

Section 8.6. Inspection. The Borrower shall, and shall cause each Subsidiary to,
permit the Administrative Agent and each of its duly authorized representatives
and agents, during normal business hours, to visit and inspect any of its
Property, corporate books, and financial records, to examine and make copies of
its books of accounts and other financial records (which shall be subject to the
confidentiality requirements of Section 12.25 hereof), and to discuss its
affairs, finances, and accounts with, and to be advised as to the same by, its
officers, employees and independent public accountants (and by this provision
the Borrower hereby authorizes such accountants to discuss with the
Administrative Agent the finances and affairs of the Borrower and its
Subsidiaries) at such reasonable times and intervals as the Administrative Agent
may designate and, so long as no Default or Event of Default is then continuing,
with reasonable prior notice to the Borrower. The Administrative Agent shall use
reasonable efforts to coordinate inspections undertaken in accordance with this
Section 8.6 to (i) minimize the administrative burden of such inspections on the
Borrower and their Subsidiaries, (ii) minimize the interference with the
business of the Borrower and their Subsidiaries and (iii) not disturb the
occupancy of any Real Property by any Tenant.

 

Section 8.7. Liens. The Borrower shall not, nor shall it permit any Guarantor
to, create, incur or permit to exist any Lien of any kind on any Property owned
by any such Person, other than Permitted Liens.

 

Section 8.8. Investments, Acquisitions, Loans and Advances. The Borrower shall
not, nor shall it permit any Subsidiary to (i) directly or indirectly, make,
retain or have outstanding any investments (whether through the purchase of
stock or obligations or otherwise) in any Person, real property or improvements
on real property, or any loans, advances, lines of credit, mortgage loans or
other financings (including pursuant to sale/leaseback transactions) to any
other Person, or (ii) acquire any real property, improvements on real property
or all or any substantial part of the assets or business of any other Person or
division thereof; provided, however, that the foregoing shall not apply to nor
operate to prevent, with respect to the Borrower or any Subsidiary, any of the
following:

 

(a) investments in direct obligations of the United States of America or of any
agency or instrumentality thereof whose obligations constitute full faith and
credit obligations of the United States of America, provided that any such
obligations shall mature within one (1) year of the date of issuance thereof;

 

(b) investments in commercial paper with a Rating of at least P-1 by Moody’s and
at least A-1 by S&P maturing within one (1) year of the date of issuance
thereof;

 

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(c) investments in certificates of deposit issued by any Lender or by any United
States commercial bank having capital and surplus of not less than $100,000,000
which have a maturity of one (1) year or less;

 

(d) investments in repurchase obligations with a term of not more than seven
(7) days for underlying securities of the types described in subsection (a)
above entered into with any bank meeting the qualifications specified in
subsection (c) above, provided all such agreements require physical delivery of
the securities securing such repurchase agreement, except those delivered
through the Federal Reserve Book Entry System;

 

(e) investments in money market funds that invest solely, and which are
restricted by their respective charters to invest solely, in investments of the
type described in the immediately preceding subsections (a), (b), (c), and (d)
above;

 

(f) the Borrower’s investments from time to time in Stock and Stock Equivalents
(including, for the avoidance of doubt, marketable securities) issued by any
real estate company or real estate investment trust (“REIT Shares”); provided
that at least 90% of such REIT Shares shall issued by real estate companies
listed on the New York Stock Exchange, Inc., the NYSE AMEX or the NASDAQ Stock
Market;

 

(g) the Borrower’s investments from time to time in its Subsidiaries, and
investments made from time to time by a Subsidiary in one or more of its
Subsidiaries;

 

(h) intercompany advances made from time to time among the Borrower and its
Subsidiaries in the ordinary course of business to finance working capital
needs;

 

(i) investments from time to time in individual Real Properties (including
Eligible Properties) or in entities which own such individual Real Properties
(including Eligible Properties), provided that such investment does not cause a
breach of the financial covenants set forth in Section 8.20 hereof or clauses
(k), (l) or (m) below;

 

(j) cash investments in joint ventures in an amount not to exceed in the
aggregate at any one time outstanding 10% of the Total Asset Value at such time;

 

(k) investments in Assets Under Development in an amount not to exceed in the
aggregate at any one time outstanding 10% of the Total Asset Value at such time;

 

(l) investments in Land Assets in an amount not to exceed in the aggregate at
any one time outstanding 10% of the Total Asset Value at such time;

 

(m) investments in Ground Leases in an amount not to exceed in the aggregate at
any one time outstanding 10% of the Total Asset Value at such time;

 

(n) investments in deposit account and securities accounts opened in the
ordinary course of business and in compliance with the terms of this Agreement;

 

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(o) investments pursuant to Hedging Agreements that are not otherwise prohibited
by the terms of this Agreement;

 

(p) investments in manufactured homes for lease or resale; and

 

(q) purchase money loans made by UMH Sales and Finance Inc. (a Subsidiary), or
any successor thereto, to purchasers of manufactured homes; and

 

(r) other investments in addition to those otherwise permitted by this Section
in an amount not to exceed in the aggregate at any one time 5% of the Total
Asset Value at such time.

 

Investments of the type described in clauses (j), (k), (l), (m), and (r)
immediately preceding shall, at no time, exceed in the aggregate at any one
time, 20% of the Total Asset Value of the Borrower and its Subsidiaries at such
time. In determining the amount of investments, acquisitions, loans, and
advances permitted under this Section, investments and acquisitions shall always
be taken at the book value (as defined in GAAP) thereof, and loans and advances
shall be taken at the principal amount thereof then remaining unpaid.

 

Section 8.9. Mergers, Consolidations and Sales. Except with the prior written
consent of the Required Lenders (which shall not be unreasonably withheld,
conditioned or delayed), the Borrower shall not, nor shall it permit any
Subsidiary to, be a party to any merger or consolidation, or sell, transfer,
lease or otherwise dispose of all or any part of its Property, including any
disposition of Property as part of a sale and leaseback transaction, or in any
event sell or discount (with or without recourse) any of its notes or accounts
receivable; provided, however, so long as no Default or Event of Default is then
continuing, this Section shall not apply to nor operate to prevent:

 

(a) the sale, transfer, lease or other disposition of Property of the Borrower
or any of its Subsidiaries to one another in the ordinary course of its
business;

 

(b) the merger of any Subsidiary with and into the Borrower or any other
Subsidiary, provided that, in the case of any merger involving the Borrower, the
Borrower is the entity surviving the merger;

 

(c) the sale, transfer or other disposition of any tangible personal property in
the ordinary course of business;

 

(d) Leases of portions of any Real Property to Tenants;

 

(e) the sale, transfer, lease or other disposition of manufactured homes in the
ordinary course of business of the Borrower or any Subsidiary;

 

(f) the sale or transfer of REIT Shares;

 

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(g) any sale, transfer, lease or other disposition of Property of the Borrower
or any Subsidiary (including any disposition of Property as part of a sale and
leaseback transaction) that is not otherwise expressly permitted by the
foregoing clauses and for net consideration that is not more than ten percent
(10%) of the Total Asset Value of the Borrower (i) for the 2016 Fiscal Year, on
the date of this Agreement, or (ii) for any subsequent Fiscal Year, the last day
of the Fiscal Year immediately preceding such sale, transfer, lease or other
disposition;

 

(h) any merger if it results in the simultaneous payoff in immediately available
funds of the Obligations;

 

(i) to the extent constituting an Investment, transactions expressly permitted
under Section 8.8; and

 

(j) any issuance, assignment, sale or transfer of Stock or other equity
interests of the Borrower so long as such issuance, assignment, sale or transfer
shall not cause a Change of Control to occur.

 

Section 8.10. Maintenance of Subsidiaries. The Borrower shall not assign, sell
or transfer, nor shall it permit any Guarantor to issue, assign, sell or
transfer, any shares of capital stock or other equity interests of a Guarantor
to any Person that is not a wholly-owned direct or indirect subsidiary of the
Borrower; provided, however, that the foregoing shall not operate to prevent
(a) Liens on the capital stock or other equity interests of Guarantors granted
to the Administrative Agent, (b) the issuance, sale and transfer to any Person
of any shares of capital stock of a Guarantor solely for the purpose of
qualifying, and to the extent legally necessary to qualify, such person as a
director of such Subsidiary, and (c) any transaction permitted by Section 8.9(b)
above.

 

Section 8.11. ERISA. The Borrower shall, and shall cause each Subsidiary to,
promptly pay and discharge all obligations and liabilities arising under ERISA
of a character which if unpaid or unperformed could reasonably be expected to
result in the imposition of a Lien against any of its Property. The Borrower
shall, and shall cause each Subsidiary to, promptly notify the Administrative
Agent and each Lender of: (a) the occurrence of any reportable event (as defined
in Section 4043 of ERISA) with respect to a Plan, (b) receipt of any notice from
the PBGC of its intention to seek termination of any Plan or appointment of a
trustee therefor, (c) its intention to terminate or withdraw from any Plan, and
(d) the occurrence of any event with respect to any Plan which would result in
the incurrence by the Borrower or any Subsidiary of any material liability, fine
or penalty, or any material increase in the contingent liability of the Borrower
or any Subsidiary with respect to any post-retirement Welfare Plan benefit. The
Borrower shall not, and shall not permit any Subsidiary to, permit any of its
respective assets to become or be deemed to be “plan assets” within the meaning
of ERISA, the Code or any of the respective regulations promulgated thereunder.

 

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Section 8.12. Compliance with Laws. (a) The Borrower shall, and shall cause each
Subsidiary to, comply in all respects with all Legal Requirements applicable to
or pertaining to its Property or business operations, where any such
non-compliance, individually or in the aggregate, could reasonably be expected
to have a Material Adverse Effect.

 

(b) The Borrower shall, and shall cause each Subsidiary to, at all times, do the
following to the extent the failure to do so, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect: (i) comply in
all material respects with, and maintain each of the Real Properties in
compliance in all material respects with, all applicable Environmental Laws;
(ii) use commercially reasonable efforts to require that each Tenant of any of
the Real Properties or any part thereof comply in all material respects with all
applicable Environmental Laws; (iii) obtain and maintain in full force and
effect all material governmental approvals required by any applicable
Environmental Law for operations at each of the Real Properties; (iv) cure any
material violation of applicable Environmental Laws by it or at any of the Real
Properties; (v) not allow the presence or operation at any of the Real
Properties of any (1) landfill or dump or (2) hazardous waste management
facility or solid waste disposal facility as defined pursuant to RCRA or any
comparable state law (other than any private sewage treatment plant maintained
at any Real Property in compliance with Environmental Laws); (vi) not
manufacture, use, generate, transport, treat, store, release, dispose or handle
any Hazardous Material at any of the Properties except in the ordinary course of
its business and in compliance with Environmental Laws; (vii) within ten (10)
Business Days after receipt of written notice of the same in connection with the
Borrower, any Subsidiary or any of the Real Properties, notify the
Administrative Agent in writing of, and provide any reasonably requested
documents with respect to, any of the following: (1) any material liability for
response or corrective action, natural resource damage or other harm pursuant to
CERCLA, RCRA or any comparable state law; (2) any material Environmental Claim;
(3) any material violation of an Environmental Law or material Release,
threatened Release or disposal of a Hazardous Material; (4) any restriction on
the ownership, occupancy, use or transferability arising pursuant to any (x)
Release, threatened Release or disposal of a Hazardous Material or (y)
Environmental Law; or (5) any environmental, natural resource, health or safety
condition which could reasonably be expected to have a Material Adverse Effect;
(viii) conduct, at its expense, any investigation, study, sampling, testing,
abatement, cleanup, removal, remediation or other response action necessary to
remove, remediate, clean up or abate any material Release, threatened Release or
disposal of a Hazardous Material as required to be performed by any applicable
Environmental Law, (ix) abide by and observe any restrictions on the use of the
Real Properties imposed by any Governmental Authority as set forth in a deed or
other instrument affecting the Borrower’s or any Subsidiary’s interest therein;
(x) promptly provide or otherwise make available to the Administrative Agent any
reasonably requested environmental record concerning the Real Properties which
the Borrower or any Subsidiary possesses or can reasonably obtain; and (xi)
perform, satisfy, and implement any operation or maintenance actions required by
any Governmental Authority or Environmental Law or included in any no further
action letter or covenant not to sue issued by any Governmental Authority under
any Environmental Law.

 

Section8.13. Compliance with OFAC Sanctions Programs and Anti-Corruption Laws.
(a) The Borrower shall at all times comply with the requirements of all OFAC
Sanctions Programs applicable to the Borrower and shall cause each of its
Subsidiaries to comply with the requirements of all OFAC Sanctions Programs
applicable to such Subsidiary.

 

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(b) The Borrower shall provide the Administrative Agent, the L/C Issuer, and the
Lenders any information regarding the Borrower, its Subsidiaries and its other
Affiliates necessary for the Administrative Agent, the L/C Issuer, and the
Lenders to comply with all applicable OFAC Sanctions Programs; subject, however,
in the case of Affiliates (other than the Subsidiaries), to the Borrower’s
ability to provide information applicable to them.

 

(c) If the Borrower obtains actual knowledge or receives any written notice that
the Borrower, any Subsidiary, or any officer, director or Affiliate of the
Borrower or that any Person that owns or controls any such Person is the target
of any OFAC Sanctions Programs or is located, organized or resident in a country
or territory that is, or whose government is, the subject of any OFAC Sanctions
Programs (such occurrence, an “OFAC Event”), the Borrower shall promptly (i)
give written notice to the Administrative Agent, the L/C Issuer, and the Lenders
of such OFAC Event, and (ii) comply in all material respects with all applicable
Legal Requirements with respect to such OFAC Event (regardless of whether the
target Person is located within the jurisdiction of the United States of
America), including the OFAC Sanctions Programs, and the Borrower hereby
authorizes and consents to the Administrative Agent, the L/C Issuer, and the
Lenders taking any and all steps the Administrative Agent, the L/C Issuer, or
the Lenders deem necessary, in their sole but reasonable discretion, to avoid
violation of all applicable Legal Requirements with respect to any such OFAC
Event, including the requirements of the OFAC Sanctions Programs (including the
freezing and/or blocking of assets and reporting such action to OFAC).

 

(d) The Borrower will not, directly or, to the Borrower’s knowledge, indirectly,
use the proceeds of the Loans or any Letter of Credit, or lend, contribute or
otherwise make available such proceeds to any other Person, (i) to fund any
activities or business of or with any Person or in any country or territory,
that, at the time of such funding, is, or whose government is, the subject of
any OFAC Sanctions Programs, or (ii) in any other manner that would result in a
violation of OFAC Sanctions Programs or Anti Corruption Laws by any Person
(including any Person participating in the facilities hereunder, whether as
underwriter, lender, advisor, investor, or otherwise).

 

(e) The Borrower will not, nor will it permit any Subsidiary to, violate any
Anti Corruption Law in any material respect.

 

(f) The Borrower will maintain in effect policies and procedures designed to
ensure compliance by the Borrower, its Subsidiaries, and its directors,
officers, employees, and agents with applicable Anti-Corruption Laws.

 

Section 8.14. Burdensome Contracts With Affiliates. The Borrower shall not, nor
shall it permit any Subsidiary to, enter into any contract, agreement or
business arrangement with any of its Affiliates on terms and conditions which
are less favorable to the Borrower or such Subsidiary than would be usual and
customary in similar contracts, agreements or business arrangements between
Persons not affiliated with each other.

 

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Section 8.15. No Changes in Fiscal Year. The Fiscal Year of the Borrower and its
Subsidiaries ends on December 31 of each year; and the Borrower shall not, nor
shall it permit any Subsidiary to, change its Fiscal Year from its present
basis.

 

Section 8.16. Formation of Subsidiaries. Promptly upon the formation or
acquisition of any Guarantor, the Borrower shall provide the Administrative
Agent and the Lenders notice thereof and timely comply with the requirements of
Section 4.2 hereof.

 

Section 8.17. Change in the Nature of Business. The Borrower shall not, nor
shall it permit any Subsidiary to, engage in any business or activity if, as a
result thereof, the general nature of the business of the Borrower or any
Subsidiary would be changed in any material respect from the general nature of
the business engaged in by it as of the Closing Date, provided that nothing
herein shall be deemed to prohibit or restrict the Borrower or any Subsidiary
from engaging in any business which is reasonably related to the core business
engaged in by it on the Closing Date.

 

Section 8.18. Use of Proceeds. The Borrower shall use the credit extended under
this Agreement solely for the purposes set forth in, or otherwise permitted by,
Section 6.4 hereof.

 

Section 8.19. No Restrictions. Except as provided herein, the Borrower shall
not, nor shall it permit any Guarantor to, directly or indirectly create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of the Borrower or any
Guarantor to: (a) pay Dividends or make any other distribution on any
Subsidiary’s capital stock or other equity interests owned by the Borrower or
any other Subsidiary, (b) pay any indebtedness owed to the Borrower or any other
Subsidiary, (c) make loans or advances to the Borrower or any other Subsidiary,
(d) transfer any of its Property to the Borrower or any other Subsidiary;
provided, however, that the foregoing does not apply to any limitation on
transfers of property this is subject to a Permitted Lien, or (e) guarantee the
Obligations, Hedging Liability, and Bank Product Obligations and/or grant Liens
on its assets to the Administrative Agent.

 

Section 8.20. Financial Covenants.

 

(a) Maximum Total Indebtedness to Total Asset Value Ratio. As of the Closing
Date and the last day of each Fiscal Quarter commencing with the Fiscal Quarter
ending June 30, 2017, the Borrower shall not permit the ratio of (i) Total
Indebtedness as of such date to (ii) Total Asset Value as of such date to be
greater than 0.60 to 1.00.

 

(b) Minimum EBITDA to Fixed Charges Ratio. As of the Closing Date and the last
day of each Fiscal Quarter commencing with the Fiscal Quarter ending June 30,
2017, the Borrower shall not permit the ratio of (i) EBITDA for the Rolling
Period then ended to (ii) Fixed Charges for such Rolling Period to be less than
1.50 to 1.00.

 

(c) [Intentionally Omitted].

 

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(d) Maximum Other Recourse Debt to Total Asset Value Ratio. As of the Closing
Date and the last day of each Fiscal Quarter commencing with the Fiscal Quarter
ending June 30, 2017, the Borrower shall not permit the ratio of (i) Other
Recourse Debt as of the last day of such Fiscal Quarter to (ii) Total Asset
Value as of such date to be greater than 0.20 to 1.00.

 

(e) Maintenance of Net Worth. The Borrower shall, as of the Closing Date and the
last day of each Fiscal Quarter of the Borrower commencing with the Fiscal
Quarter ending June 30, 2017, maintain a Tangible Net Worth of not less than the
sum of (a) $253,000,000 plus (b) 85% of the aggregate net proceeds received by
the Borrower or any of its Subsidiaries after the Closing Date in connection
with any offering of Stock or Stock Equivalents of the Borrower or the
Subsidiaries.

 

(f) Maximum Floating Rate Debt. The Borrower shall not at any time permit the
aggregate outstanding amount of Floating Rate Debt of the Borrower and its
Subsidiaries to exceed 25% of the Total Asset Value at such time.

 

Section 8.21. Electronic Delivery of Certain Information. (a) Documents,
including financial reports to be delivered pursuant to Section 8.5 hereof,
required to be delivered pursuant to this Agreement may be delivered by
electronic communication and delivery, including, the Internet, including the
website maintained by the SEC, e-mail or intranet websites to which the
Administrative Agent and each Lender have access (including a commercial,
third-party website or a website sponsored or hosted by the Administrative
Agent) provided that the foregoing shall not apply to (i) notices to any Lender
(or the L/C Issuer) pursuant to Section 1. The Administrative Agent or the
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic delivery pursuant to procedures
approved by it for all or particular notices or communications. Documents or
notices delivered electronically shall be deemed to have been delivered on the
date and time on which the Administrative Agent or the Borrower posts such
documents or the documents become available on a commercial website and the
Borrower notifies the Administrative Agent of said posting by causing an e-mail
notification to be sent to an e-mail address specified from time to time by the
Administrative Agent and provides a link thereto; provided if such notice or
other communication is not sent or posted during the normal business hours of
the recipient on a Business Day, said posting date and time shall be deemed to
have commenced as of 9:00 a.m. Chicago time on the opening of business on the
next Business Day for the recipient. Notwithstanding anything contained herein,
in every instance the Borrower shall be required to provide paper copies of the
certificates required by Sections 8.5(d) and 8.5(e) to the Administrative Agent.
Except for the certificates required by Sections 8.5(d) and 8.5(e), the
Administrative Agent shall have no obligation to request the delivery of or to
maintain paper copies of the documents delivered electronically, and in any
event shall have no responsibility to monitor compliance by the Borrower with
any such request for delivery.

 

(b) Documents required to be delivered pursuant to Section 1 may be delivered
electronically to a website provided for such purpose by the Administrative
Agent pursuant to the procedures provided to the Borrower by the Administrative
Agent.

 

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Section 9. Events of Default and Remedies

 

Section 9.1. Events of Default. Any one or more of the following shall
constitute an “Event of Default” hereunder:

 

(a) default in the payment when due of (i) all or any part of the principal of
any Loan (whether at the stated maturity thereof or at any other time provided
for in this Agreement, including a mandatory prepayment required by Section
1.8(b)), (ii) any Reimbursement Obligation (except in any case in which a Loan
has been made in the amount of the Reimbursement Obligations then due and the
proceeds thereof applied to pay such Reimbursement Obligations as contemplated
by Section 1.2(c)) (iii) any payment when due of any interest or (iv) any fee or
other Obligation payable hereunder or under any other Loan Document, with such
default in payment continuing for (A) in the case of the foregoing clauses (ii)
and (iii), three (3) Business Days after receipt of written notice thereof from
the Administrative Agent and (B) in the case of the foregoing clause (iv), five
(5) Business Days after receipt of written notice thereof from the
Administrative Agent;

 

(b) default in the observance or performance of any covenant set forth in
Sections 8.1, 8.5, 8.7, 8.8, 8.9, 8.10, 8.11, 8.20 or 8.22 hereof;

 

(c) default in the observance or performance of any other provision hereof or of
any other Loan Document which is not remedied within thirty (30) days after the
earlier of (i) the date on which such failure shall first become known to any
Responsible Officer of the Borrower and (ii) written notice thereof is given to
the Borrower by the Administrative Agent; provided, however, if such a default
is susceptible of cure but cannot reasonably be cured within such thirty (30)
day period and provided further that the Borrower shall have commenced to cure
such default within such thirty (30) day period and thereafter diligently and
expeditiously proceeds to cure the same, such thirty (30) day period shall be
extended for such time as is reasonably necessary for the Borrower in the
exercise of due diligence to cure such default, provided such additional period
shall not exceed sixty (60) days;

 

(d) any representation or warranty made herein or in any other Loan Document or
in any certificate furnished to the Administrative Agent or the Lenders pursuant
hereto or thereto or in connection with any transaction contemplated hereby or
thereby proves untrue in any material respect as of the date of the issuance or
making or deemed making thereof;

 

(e) any event occurs or condition exists (other than those described in
subsections (a) through (d) above) which is specified as an event of default
under any of the other Loan Documents (and the related grace and/or cure period,
if any, shall have expired), or any of the Loan Documents shall for any reason
not be or shall cease to be in full force and effect or is declared to be null
and void;

 

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(f) default (with expiration of any grace and/or cure periods related thereto)
shall occur under (x) any Indebtedness issued, assumed or guaranteed by the
Borrower or any Guarantor aggregating in excess of (i) with respect to any
recourse Indebtedness issued, assumed or guaranteed by the Borrower or any
Guarantor, $1,000,000 in the aggregate, or (ii) respect to any other
Indebtedness issued, assumed or guaranteed by the Borrower or any Guarantor,
$5,000,000 in the aggregate, or a default (with expiration of any grace and/or
cure periods related thereto) shall occur with respect to any Indebtedness
issued, assumed or guaranteed by the Borrower or any Guarantor, and such default
shall continue for a period of time sufficient to permit the acceleration of the
maturity of any such Indebtedness (whether or not such maturity is in fact
accelerated);

 

(g) any judgment or judgments, writ or writs or warrant or warrants of
attachment, or any similar process or processes, shall be entered or filed
against the Borrower or any Guarantor, or against any of its respective
Property, in an aggregate amount in excess of $5,000,000 (except to the extent
fully covered by insurance pursuant to which the insurer has accepted liability
therefor in writing), and which remains undischarged, unvacated, unbonded or
unstayed for a period of sixty (60) days;

 

(h) the Borrower or any Guarantor, or any member of its Controlled Group, shall
fail to pay when due an amount or amounts aggregating in excess of $5,000,000
which it shall have become liable to pay to the PBGC or to a Plan under Title IV
of ERISA; or notice of intent to terminate a Plan or Plans having aggregate
Unfunded Vested Liabilities in excess of $5,000,000 (collectively, a “Material
Plan”) shall be filed under Title IV of ERISA by the Borrower or any Guarantor,
or any other member of its Controlled Group, any plan administrator or any
combination of the foregoing; or the PBGC shall institute proceedings under
Title IV of ERISA to terminate or to cause a trustee to be appointed to
administer any Material Plan or a proceeding shall be instituted by a fiduciary
of any Material Plan against the Borrower or any Guarantor, or any member of its
Controlled Group, to enforce Section 515 or 4219(c)(5) of ERISA and such
proceeding shall not have been dismissed within thirty (30) days thereafter; or
a condition shall exist by reason of which the PBGC would be entitled to obtain
a decree adjudicating that any Material Plan must be terminated;

 

(i) any Change of Control shall occur;

 

(j) the Borrower or any Guarantor shall (i) admit in writing its inability to
pay, its debts generally as they become due, (ii) make an assignment for the
benefit of creditors, (iii) apply for, seek, consent to or acquiesce in, the
appointment of a receiver, custodian, trustee, examiner, liquidator or similar
official for it or any substantial part of its Property, (iv) institute any
proceeding seeking to have entered against it an order for relief under the
United States Bankruptcy Code, as amended, to adjudicate it insolvent, or
seeking dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors or fail to file an
answer or other pleading denying the material allegations of any such proceeding
filed against it within sixty (60) days, (v) take any board of director or
shareholder action (including the convening of a meeting) in furtherance of any
matter described in parts (i) through (iv) above, or (vi) fail to contest in
good faith any appointment or proceeding described in Section 9.1(k) hereof;

 

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(k) an order for relief under the United States Bankruptcy Code, as amended,
shall have entered involuntarily against the Borrower or any Guarantor or a
custodian, receiver, trustee, examiner, liquidator or similar official shall be
appointed for the Borrower or any Guarantor, or any substantial part of its
Property and such appointment continues undischarged or such proceeding
continues undismissed or unstayed for a period of sixty (60) days;

 

(l) the Common Stock of Borrower fails to be duly listed on the New York Stock
Exchange, Inc., the NYSE Amex or The NASDAQ Stock Market.

 

Section 9.2. Non Bankruptcy Defaults. When any Event of Default (other than
those described in subsection (j) or (k) of Section 9.1 hereof with respect to
the Borrower) has occurred and is continuing, the Administrative Agent shall, by
written notice to the Borrower: (a) if so directed by the Required Lenders,
terminate the remaining Commitments and all other obligations of the Lenders
hereunder on the date stated in such notice (which may be the date thereof); (b)
if so directed by the Required Lenders, declare the principal of and the accrued
interest on all outstanding Loans to be forthwith due and payable and thereupon
all outstanding Loans, including both principal and interest thereon, shall be
and become immediately due and payable together with all other amounts payable
under the Loan Documents without further demand, presentment, protest or notice
of any kind; and (c) if so directed by the Required Lenders, demand that, with
respect to each Letter of Credit then outstanding, the Borrower immediately
either (i) pay to the Administrative Agent the full amount then available for
drawing thereunder, (ii) deliver to the Administrative Agent Cash Collateral in
an amount equal to 105% of the aggregate amount thereof or (iii) return or cause
to be returned to L/C Issuer such Letter of Credit for cancellation, and the
Borrower agrees to immediately take such action and acknowledges and agrees that
the Lenders would not have an adequate remedy at law for failure by the Borrower
to honor any such demand and that the Administrative Agent, for the benefit of
the Lenders, shall have the right to require the Borrower to specifically
perform such undertaking whether or not any drawings or other demands for
payment have been made under any Letter of Credit. The Administrative Agent,
after giving notice to the Borrower pursuant to Section 9.1(c) or this Section
9.2, shall also promptly send a copy of such notice to the other Lenders, but
the failure to do so shall not impair or annul the effect of such notice.Section

 

9.3. Bankruptcy Defaults. When any Event of Default described in subsections (j)
or (k) of Section 9.1 hereof with respect to the Borrower has occurred and is
continuing, all outstanding Loans shall immediately become due and payable
together with all other amounts payable under the Loan Documents without
presentment, demand, protest or notice of any kind, the obligation of the
Lenders to extend further credit pursuant to any of the terms hereof shall
immediately terminate and, with respect to each Letter of Credit then
outstanding, the Borrower immediately either (i) pay to the Administrative Agent
the full amount then available for drawing thereunder, (ii) deliver to the
Administrative Agent Cash Collateral in an amount equal to 105% of the aggregate
amount thereof or (iii) return or cause to be returned to L/C Issuer such Letter
of Credit for cancellation, the Borrower acknowledging and agreeing that the
Lenders would not have an adequate remedy at law for failure by the Borrower to
honor any such demand and that the Lenders, and the Administrative Agent on
their behalf, shall have the right to require the Borrower to specifically
perform such undertaking whether or not any draws or other demands for payment
have been made under any of the Letters of Credit.

 

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Section 9.4. Collateral for Undrawn Letters of Credit. (a) If the prepayment of
the amount available for drawing under any or all outstanding Letters of Credit
is required under Section 1.8(b), Section 1.14, Section 9.2 or Section 9.3
above, the Borrower shall forthwith pay the amount required to be so prepaid, to
be held by the Administrative Agent as provided in subsection (b) below.

 

(b) All amounts prepaid pursuant to subsection (a) above shall be held by the
Administrative Agent in one or more separate collateral accounts (each such
account, and the credit balances, properties, and any investments from time to
time held therein, and any substitutions for such account, any certificate of
deposit or other instrument evidencing any of the foregoing and all proceeds of
and earnings on any of the foregoing being collectively called the “Collateral
Account”) as security for, and for application by the Administrative Agent (to
the extent available) to, the reimbursement of any payment under any Letter of
Credit then or thereafter made by the L/C Issuer, and to the payment of the
unpaid balance of all other Obligations (and to all Hedging Liability and Bank
Product Obligations). The Collateral Account shall be held in the name of and
subject to the exclusive dominion and control of the Administrative Agent for
the benefit of the Administrative Agent, the Lenders, and the L/C Issuer. If and
when requested by the Borrower, the Administrative Agent shall invest funds held
in the Collateral Account from time to time in direct obligations of, or
obligations the principal of and interest on which are unconditionally
guaranteed by, the United States of America with a remaining maturity of one
year or less, provided that the Administrative Agent is irrevocably authorized
to sell investments held in the Collateral Account when and as required to make
payments out of the Collateral Account for application to amounts then due and
owing from the Borrower to the L/C Issuer, the Administrative Agent or the
Lenders. If the Borrower shall have made payment of all obligations referred to
in subsection (a) above required under Section 1.8(b) hereof, if any, at the
request of the Borrower the Administrative Agent shall release to the Borrower
amounts held in the Collateral Account so long as at the time of the release and
after giving effect thereto no Default or Event of Default is then continuing.
If the Borrower shall have made payment of all obligations referred to in
subsection (a) above required under Section 9.2 or 9.3 hereof, so long as no
Letters of Credit, Commitments, Loans or other Obligations, Hedging Liability,
or Bank Product Obligations remain outstanding, at the request of the Borrower
the Administrative Agent shall release to the Borrower any remaining amounts
held in the Collateral Account.

 

(c) At any time that there shall exist a Defaulting Lender, within one Business
Day following the written request of the Administrative Agent or any L/C Issuer
(with a copy to the Administrative Agent), the Borrower shall Cash Collateralize
the L/C Issuers’ Fronting Exposure with respect to such Defaulting Lender
(determined after giving effect to Section 1.14(a)(iv) and any Cash Collateral
provided by such Defaulting Lender) in an amount not less than the Minimum
Collateral Amount.

 

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(i) Grant of Security Interest. The Borrower, and to the extent provided by any
Defaulting Lender, such Defaulting Lender, hereby grant to the Administrative
Agent, for the benefit of the L/C Issuers, and agree to maintain, a first
priority security interest in all such Cash Collateral as security for such
Defaulting Lender’s obligation to fund participations in respect of L/C
Obligations, to be applied pursuant to clause (ii) below. If at any time the
Administrative Agent determines that Cash Collateral is subject to any right or
claim of any Person other than the Administrative Agent and the L/C Issuer as
herein provided, or that the total amount of such Cash Collateral is less than
the Minimum Collateral Amount, the Borrower shall, promptly upon demand by the
Administrative Agent, pay or provide to the Administrative Agent additional Cash
Collateral in an amount sufficient to eliminate such deficiency (after giving
effect to any Cash Collateral provided by the Defaulting Lender).

 

(ii) Application. Notwithstanding anything to the contrary contained in this
Agreement, Cash Collateral provided under this Section 9.4 or Section 1.14 in
respect of Letters of Credit shall be applied to the satisfaction of the
Defaulting Lender’s obligation to fund participations in respect of L/C
Obligations (including, as to Cash Collateral provided by a Defaulting Lender,
any interest accrued on such obligation) for which the Cash Collateral was so
provided, prior to any other application of such property as may otherwise be
provided for herein.

 

(iii) Termination of Requirement. Cash Collateral (or the appropriate portion
thereof) provided to reduce any L/C Issuer’s Fronting Exposure shall no longer
be required to be held as Cash Collateral pursuant to this Section 9.4(c)
following (A) the elimination of the applicable Fronting Exposure (including by
the termination of Defaulting Lender status of the applicable Lender), or (B)
the determination by the Administrative Agent and the L/C Issuer that there
exists excess Cash Collateral; provided that, subject to Section 1.14 the Person
providing Cash Collateral and the L/C Issuer may agree that Cash Collateral
shall be held to support future anticipated Fronting Exposure or other
obligations and provided further that to the extent that such Cash Collateral
was provided by the Borrower, such Cash Collateral shall remain subject to the
security interest granted pursuant to the Loan Documents.

 

Section 9.5. Notice of Default. The Administrative Agent shall give notice to
the Borrower under Section 9.1(c) hereof promptly upon being requested to do so
by any Lender and shall thereupon notify all the Lenders thereof.

 

Section 10. Change in Circumstances.

 

Section 10.1. Change of Law. Notwithstanding any other provisions of this
Agreement or any other Loan Document, if at any time any Change in Law makes it
unlawful for any Lender to make or continue to maintain any Eurodollar Loans or
to perform its obligations as contemplated hereby, such Lender shall promptly
give notice thereof to the Borrower and such Lender’s obligations to make or
maintain Eurodollar Loans under this Agreement shall be suspended until it is no
longer unlawful for such Lender to make or maintain Eurodollar Loans. The
Borrower shall prepay on demand the outstanding principal amount of any such
affected Eurodollar Loans, together with all interest accrued thereon and all
other amounts then due and payable to such Lender under this Agreement;
provided, however, subject to all of the terms and conditions of this Agreement,
the Borrower may then elect to borrow the principal amount of the affected
Eurodollar Loans from such Lender by means of Base Rate Loans from such Lender,
which Base Rate Loans shall not be made ratably by the Lenders but only from
such affected Lender.

 

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Section 10.2. Unavailability of Deposits or Inability to Ascertain, or
Inadequacy of, LIBOR. If on or prior to the first day of any Interest Period for
any Borrowing of Eurodollar Loans:

 

(a) the Administrative Agent determines in good faith that deposits in U.S.
Dollars (in the applicable amounts) are not being offered to it in the interbank
eurodollar market for such Interest Period, or that by reason of circumstances
affecting the interbank eurodollar market adequate and reasonable means do not
exist for ascertaining the applicable LIBOR, or

 

(b) the Required Lenders in good faith advise the Administrative Agent that (i)
LIBOR as determined by the Administrative Agent will not adequately and fairly
reflect the cost to such Lenders of funding their Eurodollar Loans for such
Interest Period or (ii) that the making or funding of Eurodollar Loans becomes
impracticable, or

 

(c) if at any time the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that (i) the circumstances set forth
in clauses (a) or (b) have arisen and such circumstances are unlikely to be
temporary, (ii) LIBOR is no longer a widely recognized benchmark rate for newly
originated loans in Dollars in the U.S. market or (iii) the circumstances set
forth in clauses (a) or (b) have not arisen but the supervisor for the
administrator of LIBOR or a Governmental Authority having jurisdiction over the
Administrative Agent has made a public statement identifying a specific date
after which LIBOR shall no longer be used for determining interest rates for
loans, then the Administrative Agent and the Borrowers shall endeavor to
establish an alternative rate of interest to LIBOR that gives due consideration
to the then prevailing market convention for determining a rate of interest for
syndicated loans in the United States at such time, and shall enter into an
amendment to this Agreement to reflect such alternate rate of interest and such
other related changes to this Agreement as may be applicable. Notwithstanding
anything to the contrary in Section 12.13, such amendment shall become effective
without any further action or consent of any other party to this Agreement so
long as Administrative Agent shall not have received, within five (5) Business
Days of the date notice of such alternate rate of interest is provided to the
Lenders, a written notice from the Required Lenders stating that such Required
Lenders object to such amendment. Until an alternate rate of interest shall be
determined in accordance with this clause (c) (but, in the case of the
circumstances described in clause (ii) of the first sentence of this Section
10.2(c), only to the extent LIBOR for such Interest Period is not available or
published at such time on a current basis), (x) any notice that requests the
conversion of any Borrowing to, or continuation of any Borrowing as, a
Eurodollar Loan shall be ineffective, and (y) if any Borrowing notice requests a
Eurodollar Loan, such Borrowing shall be made as a Base Rate Loan; provided
that, if such alternate rate of interest shall be less than zero, such rate
shall be deemed to be zero for the purposes of this Agreement,

 

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then the Administrative Agent shall forthwith give notice thereof to the
Borrower and the Lenders, whereupon until the Administrative Agent notifies the
Borrower that the circumstances giving rise to such suspension no longer exist,
the obligations of the Lenders to make Eurodollar Loans shall be suspended.

 

Section 10.3. Increased Cost and Reduced Return. (a) If any Change in Law shall:

 

(i) subject any Lender (or its Lending Office) or the L/C Issuer to any Tax
(other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through
(d) of the definition of Excluded Taxes, and (C) Connection Income Taxes) with
respect to its Eurodollar Loans, its Notes, its Letter(s) of Credit, or its
participation in any thereof, any Reimbursement Obligations owed to it or its
obligation to make Eurodollar Loans, issue a Letter of Credit, or to participate
therein, or shall change the basis of taxation of payments to any Lender (or its
Lending Office) or the L/C Issuer of the principal of or interest on its
Eurodollar Loans, Letter(s) of Credit, or participations therein or any other
amounts due under this Agreement or any other Loan Document in respect of its
Eurodollar Loans, Letter(s) of Credit, any participation therein, any
Reimbursement Obligations owed to it, or its obligation to make Eurodollar
Loans, or issue a Letter of Credit, or acquire participations therein (except
for changes in the basis or rate of (A) Indemnified Taxes, (B) Taxes described
in clauses (b) through (d) of the definition of Excluded Taxes and (C)
Connection Income Taxes); or

 

(ii) impose, modify or deem applicable any reserve, special deposit, compulsory
loan, insurance charge or similar requirement (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding with respect to any Eurodollar Loans any such requirement
included in an applicable Eurodollar Reserve Percentage) against assets of,
deposits with or for the account of, or credit extended by, any Lender (or its
Lending Office) or the L/C Issuer or shall impose on any Lender (or its Lending
Office) or the L/C Issuer or on the interbank market any other condition
affecting its Eurodollar Loans, its Notes, its Letter(s) of Credit, or its
participation in any thereof, any Reimbursement Obligation owed to it, or its
obligation to make Eurodollar Loans, or to issue a Letter of Credit, or to
participate therein;

 

and the result of any of the foregoing is to increase the cost to such Lender
(or its Lending Office) or the L/C Issuer of making or maintaining any
Eurodollar Loan, issuing or maintaining a Letter of Credit, or participating
therein, or to reduce the amount of any sum received or receivable by such
Lender (or its Lending Office) or the L/C Issuer under this Agreement or under
any other Loan Document with respect thereto, by an amount deemed by such Lender
or L/C Issuer to be material, then, within 15 days after demand by such Lender
or L/C Issuer (with a copy to the Administrative Agent), the Borrower shall be
obligated to pay to such Lender or L/C Issuer such additional amount or amounts
as will compensate such Lender or L/C Issuer for such increased cost or
reduction.

 

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(b) If any Lender or L/C Issuer determines that any Change in Law affecting such
Lender or L/C Issuer or any lending office of such Lender or such Lender’s or
L/C Issuer’s holding company, if any, regarding capital or liquidity
requirements, has or would have the effect of reducing the rate of return on
such Lender’s or L/C Issuer’s capital or on the capital of such Lender’s or L/C
Issuer’s holding company, if any, as a consequence of this Agreement, the
Commitments of such Lender or the Loans made by, or participations in Letters of
Credit held by, such Lender, or the Letters of Credit issued by any L/C Issuer,
to a level below that which such Lender or L/C Issuer or such Lender’s or L/C
Issuer’s holding company could have achieved but for such Change in Law (taking
into consideration such Lender’s or L/C Issuer’s policies and the policies of
such Lender’s or L/C Issuer’s holding company with respect to capital adequacy),
then from time to time, within 15 days after demand by such Lender or L/C Issuer
(with a copy to the Administrative Agent), the Borrower shall pay to such Lender
or L/C Issuer, as the case may be, such additional amount or amounts as will
compensate such Lender or L/C Issuer or such Lender’s or L/C Issuer’s holding
company for any such reduction suffered.

 

(c) A certificate of a Lender or L/C Issuer claiming compensation under this
Section 10.3 and setting forth the additional amount or amounts to be paid to it
hereunder shall be conclusive if reasonably determined. In determining such
amount, such Lender or L/C Issuer may use any reasonable averaging and
attribution methods.

 

(d) The Borrower shall not be required to compensate a Lender or L/C Issuer
pursuant to this Section for any increased costs incurred or reductions suffered
more than six (6) months prior to the date that such Lender or L/C Issuer, as
the case may be, notifies the Borrower of the Change in Law giving rise to such
increased costs or reductions, and of such Lender’s or L/C Issuer’s intention to
claim compensation therefor (except that, if the Change in Law giving rise to
such increased costs or reductions is retroactive, then the six-month period
referred to above shall be extended to include the period of retroactive effect
thereof).

 

Section 10.4. Lending Offices. Each Lender may, at its option, elect to make its
Loans hereunder at the branch, office or affiliate specified on the appropriate
signature page hereof (each a “Lending Office”) for each type of Loan available
hereunder or at such other of its branches, offices or affiliates as it may from
time to time elect and designate in a written notice to the Borrower and the
Administrative Agent. To the extent reasonably possible, a Lender shall
designate an alternative branch or funding office with respect to its Eurodollar
Loans to reduce any liability of the Borrower to such Lender under Section 10.3
hereof or to avoid the unavailability of Eurodollar Loans under Section 10.2
hereof, so long as such designation is not otherwise disadvantageous to the
Lender.

 

Section 10.5. Discretion of Lender as to Manner of Funding. Notwithstanding any
other provision of this Agreement, each Lender shall be entitled to fund and
maintain its funding of all or any part of its Loans in any manner it sees fit,
it being understood, however, that for the purposes of this Agreement all
determinations hereunder with respect to Eurodollar Loans shall be made as if
each Lender had actually funded and maintained each Eurodollar Loan through the
purchase of deposits in the interbank eurodollar market having a maturity
corresponding to such Loan’s Interest Period, and bearing an interest rate equal
to LIBOR for such Interest Period.

 

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Section 11. The Administrative Agent.

 

Section 11.1. Appointment and Authorization of Administrative Agent. Each Lender
and the L/C Issuer hereby appoints Bank of Montreal as the Administrative Agent
under the Loan Documents and hereby authorizes the Administrative Agent to take
such action as Administrative Agent on its behalf and to exercise such powers
under the Loan Documents as are delegated to the Administrative Agent by the
terms thereof, together with such powers as are reasonably incidental thereto.
The Lenders and L/C Issuer expressly agree that the Administrative Agent is not
acting as a fiduciary of the Lenders or the L/C Issuer in respect of the Loan
Documents, the Borrower or otherwise, and nothing herein or in any of the other
Loan Documents shall result in any duties or obligations on the Administrative
Agent or any of the Lenders or L/C Issuer except as expressly set forth herein.

 

Section 11.2. Administrative Agent and its Affiliates. The Administrative Agent
shall have the same rights and powers under this Agreement and the other Loan
Documents as any other Lender and may exercise or refrain from exercising such
rights and power as though it were not the Administrative Agent, and the
Administrative Agent and its affiliates may accept deposits from, lend money to,
and generally engage in any kind of business with the Borrower or any Affiliate
of the Borrower as if it were not the Administrative Agent under the Loan
Documents. The term “Lender” as used herein and in all other Loan Documents,
unless the context otherwise clearly requires, includes the Administrative Agent
in its capacity as a Lender (if applicable).

 

Section 11.3. Action by Administrative Agent. If the Administrative Agent
receives from the Borrower a written notice of an Event of Default pursuant to
Section 8.5(k) hereof, the Administrative Agent shall promptly give each of the
Lenders and L/C Issuer written notice thereof. The obligations of the
Administrative Agent under the Loan Documents are only those expressly set forth
therein. Without limiting the generality of the foregoing, the Administrative
Agent shall not be required to take any action hereunder with respect to any
Default or Event of Default, except as expressly provided in Sections 9.2 and
9.5. Unless and until the Required Lenders give such direction, the
Administrative Agent may (but shall not be obligated to) take or refrain from
taking such actions as it deems appropriate and in the best interest of all the
Lenders and L/C Issuer. In no event, however, shall the Administrative Agent be
required to take any action in violation of applicable Legal Requirements or of
any provision of any Loan Document, and the Administrative Agent shall in all
cases be fully justified in failing or refusing to act hereunder or under any
other Loan Document unless it first receives any further assurances of its
indemnification from the Lenders that it may require, including prepayment of
any related expenses and any other protection it requires against any and all
costs, expenses, and liabilities which may be incurred by it by reason of taking
or continuing to take any such action. The Administrative Agent shall be
entitled to assume that no Default or Event of Default exists unless notified in
writing to the contrary by a Lender, the L/C Issuer, or the Borrower. In all
cases in which the Loan Documents do not require the Administrative Agent to
take specific action, the Administrative Agent shall be fully justified in using
its discretion in failing to take or in taking any action thereunder. Any
instructions of the Required Lenders, or of any other group of Lenders called
for under the specific provisions of the Loan Documents, shall be binding upon
all the Lenders and the holders of the Obligations.

 

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Section 11.4. Consultation with Experts. The Administrative Agent may consult
with legal counsel, independent public accountants, and other experts selected
by it and shall not be liable for any action taken or omitted to be taken by it
in good faith in accordance with the advice of such counsel, accountants or
experts.

 

Section 11.5. Liability of Administrative Agent; Credit Decision. Neither the
Administrative Agent nor any of its directors, officers, agents or employees
shall be liable for any action taken or not taken by it in connection with the
Loan Documents: (i) with the consent or at the request of the Required Lenders
or (ii) in the absence of its own gross negligence or willful misconduct as
determined by a court of competent jurisdiction by final non-appealable
judgment. Neither the Administrative Agent nor any of its directors, officers,
agents or employees shall be responsible for or have any duty to ascertain,
inquire into or verify: (i) any statement, warranty or representation made in
connection with this Agreement, any other Loan Document or any Credit Event;
(ii) the performance or observance of any of the covenants or agreements of the
Borrower or any Subsidiary contained herein or in any other Loan Document; (iii)
the satisfaction of any condition specified in Section 7 hereof, except receipt
of items required to be delivered to the Administrative Agent; or (iv) the
validity, effectiveness, genuineness, enforceability, perfection, value, worth
or collectability hereof or of any other Loan Document or of any other documents
or writing furnished in connection with any Loan Document; and the
Administrative Agent makes no representation of any kind or character with
respect to any such matter mentioned in this sentence. The Administrative Agent
may execute any of its duties under any of the Loan Documents by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, the L/C Issuer, the Borrower, or any other Person for the default or
misconduct of any such agents or attorneys-in-fact selected with reasonable
care. The Administrative Agent shall not incur any liability by acting in
reliance upon any notice, consent, certificate, other document or statement
(whether written or oral) believed by it to be genuine or to be sent by the
proper party or parties. In particular and without limiting any of the
foregoing, the Administrative Agent shall have no responsibility for confirming
the accuracy of any Compliance Certificate or other document or instrument
received by it under the Loan Documents. The Administrative Agent may treat the
payee of any Obligation as the holder thereof until written notice of transfer
shall have been filed with the Administrative Agent signed by such payee in form
satisfactory to the Administrative Agent. Each Lender and L/C Issuer
acknowledges that it has independently and without reliance on the
Administrative Agent or any other Lender or L/C Issuer, and based upon such
information, investigations and inquiries as it deems appropriate, made its own
credit analysis and decision to extend credit to the Borrower in the manner set
forth in the Loan Documents. It shall be the responsibility of each Lender and
L/C Issuer to keep itself informed as to the creditworthiness of the Borrower
and its Subsidiaries, and the Administrative Agent shall have no liability to
any Lender or L/C Issuer with respect thereto.

 

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Section 11.6. Indemnity. The Lenders shall ratably, in accordance with their
respective Percentages, indemnify and hold the Administrative Agent, and its
directors, officers, employees, agents, and representatives harmless from and
against any liabilities, losses, costs or expenses suffered or incurred by it
under any Loan Document or in connection with the transactions contemplated
thereby, regardless of when asserted or arising, except to the extent they are
promptly reimbursed for the same by the Borrower and except to the extent that
any event giving rise to a claim was caused by the gross negligence or willful
misconduct of the party seeking to be indemnified as determined by a court of
competent jurisdiction by final non-appealable judgment. The obligations of the
Lenders under this Section 11.6 shall survive termination of this Agreement. The
Administrative Agent shall be entitled to offset amounts received for the
account of a Lender under this Agreement against unpaid amounts due from such
Lender to the Administrative Agent or any L/C Issuer hereunder (whether as
fundings of participations, indemnities or otherwise, and with any amounts
offset for the benefit of the Administrative Agent to be held by it for its own
account and with any amounts offset for the benefit of a L/C Issuer to be
remitted by the Administrative Agent to or for the account of such L/C Issuer),
but shall not be entitled to offset against amounts owed to the Administrative
Agent or any L/C Issuer or by any Lender arising outside of this Agreement and
the other Loan Documents.

 

Section 11.7. Resignation of Administrative Agent and Successor Administrative
Agent. The Administrative Agent may resign at any time by giving written notice
thereof to the Lenders, the L/C Issuer, and the Borrower. Upon any such
resignation of the Administrative Agent, the Required Lenders shall have the
right to appoint a successor Administrative Agent, which shall so long as no
Event of Default has occurred and is continuing, be reasonably acceptable to the
Borrower. If no successor Administrative Agent shall have been so appointed by
the Required Lenders, and shall have accepted such appointment, within 30 days
after the retiring Administrative Agent’s giving of notice of resignation then
the retiring Administrative Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent, which shall so long as no Event of Default has
occurred and is continuing, be reasonably acceptable to the Borrower, and which
may be any Lender hereunder or any commercial bank, or an Affiliate of a
commercial bank, having an office in the United States of America and having a
combined capital and surplus of at least $200,000,000. Upon the acceptance of
its appointment as the Administrative Agent hereunder, such successor
Administrative Agent shall thereupon succeed to and become vested with all the
rights and duties of the retiring Administrative Agent under the Loan Documents,
and the retiring Administrative Agent shall be discharged from its duties and
obligations thereunder. After any retiring Administrative Agent’s resignation
hereunder as Administrative Agent, the provisions of this Section 11 and all
protective provisions of the other Loan Documents shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was Administrative
Agent, but no successor Administrative Agent shall in any event be liable or
responsible for any actions of its predecessor. If the Administrative Agent
resigns and no successor is appointed, the rights and obligations of such
Administrative Agent shall be automatically assumed by the Required Lenders and
the Borrower shall be directed to make all payments due each Lender and L/C
Issuer hereunder directly to such Lender or L/C Issuer.

 

Section 11.8. L/C Issuer. The L/C Issuer shall act on behalf of the Lenders with
respect to any Letters of Credit issued by it and the documents associated
therewith. The L/C Issuer shall have all of the benefits and immunities (i)
provided to the Administrative Agent in this Section 11 with respect to any acts
taken or omissions suffered by the L/C Issuer in connection with Letters of
Credit issued by it or proposed to be issued by it and the Applications
pertaining to such Letters of Credit made or to be made hereunder as fully as if
the term “Administrative Agent”, as used in this Section 11, included the L/C
Issuer with respect to such acts or omissions and (ii) as additionally provided
in this Agreement with respect to such L/C Issuer.

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Section 11.9. Hedging Liability and Bank Product Obligations. By virtue of a
Lender’s execution of this Agreement or an assignment agreement pursuant to
Section 12.12 hereof, as the case may be, any Affiliate of such Lender with whom
the Borrower or any Subsidiary has entered into an agreement creating Hedging
Liability or Bank Product Obligations shall be deemed a Lender party hereto for
purposes of any reference in a Loan Document to the parties for whom the
Administrative Agent is acting, it being understood and agreed that the rights
and benefits of such Affiliate under the Loan Documents consist exclusively of
such Affiliate’s right to share in payments and collections out of the
Guaranties as more fully set forth in Section 3.1 hereof. In connection with any
such distribution of payments and collections, or any request for the release of
the Guaranties and the Administrative Agent’s Liens in connection with the
termination of the Commitments and the payment in full of the Obligations, the
Administrative Agent shall be entitled to assume no amounts are due to any
Lender or its Affiliate with respect to Hedging Liability or Bank Product
Obligations unless such Lender has notified the Administrative Agent in writing
of the amount of any such liability owed to it or its Affiliate prior to such
distribution or payment or release of Guaranties.

 

Section 11.10. Designation of Additional Agents. The Administrative Agent shall
have the continuing right, for purposes hereof, at any time and from time to
time to designate one or more of the Lenders (and/or its or their Affiliates) as
“syndication agents,” “documentation agents,” “book runners,” “lead arrangers,”
“arrangers” or other designations for purposes hereto, but such designation
shall have no substantive effect, and such Lenders and their Affiliates shall
have no additional powers, duties or responsibilities as a result thereof.

 

Section 12. Miscellaneous.

 

Section 12.1. Taxes.

 

(a) Certain Defined Terms. For purposes of this Section, the term “Lender”
includes any L/C Issuer and the term “applicable law” includes FATCA.

 

(b) Payments Free of Taxes. Any and all payments by or on account of any
obligation of the Borrower or any Guarantor under any Loan Document shall be
made without deduction or withholding for any Taxes, except as required by
applicable law. If any applicable law (as determined in the good faith
discretion of an applicable Withholding Agent) requires the deduction or
withholding of any Tax from any such payment by a Withholding Agent, then the
applicable Withholding Agent shall be entitled to make such deduction or
withholding and shall timely pay the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law and, if such
Tax is an Indemnified Tax, then the sum payable by the Borrower or the
applicable Guarantor shall be increased as necessary so that after such
deduction or withholding has been made (including such deductions and
withholdings applicable to additional sums payable under this Section) the
applicable Recipient receives an amount equal to the sum it would have received
had no such deduction or withholding been made.

 

(c) Payment of Other Taxes by Borrower and Guarantors. The Borrower and
Guarantors shall timely pay to the relevant Governmental Authority in accordance
with applicable law, or at the option of the Administrative Agent timely
reimburse it for the payment of, any Other Taxes.

 

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(d) Indemnification by Borrower and Guarantor. The Borrower and Guarantors shall
jointly and severally indemnify each Recipient, within ten (10) days after
demand therefor, for the full amount of any Indemnified Taxes (including
Indemnified Taxes imposed or asserted on or attributable to amounts payable
under this Section) payable or paid by such Recipient or required to be withheld
or deducted from a payment to such Recipient and any reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
A certificate as to the amount of such payment or liability delivered to the
Borrower by a Lender (with a copy to the Administrative Agent), or by the
Administrative Agent on its own behalf or on behalf of a Lender, shall be
conclusive absent manifest error.

 

(e) Indemnification by the Lenders. Each Lender shall severally indemnify the
Administrative Agent, within ten (10) days after demand therefor, for (i) any
Indemnified Taxes or Other Taxes attributable to such Lender (but only to the
extent that the Borrower or any Guarantor has not already indemnified the
Administrative Agent for such Indemnified Taxes or Other Taxes and without
limiting the obligation of the Borrower and the Guarantors to do so), (ii) any
Taxes attributable to such Lender’s failure to comply with the provisions of
Section 12.11 relating to the maintenance of a Participant Register and (iii)
any Excluded Taxes attributable to such Lender, in each case, that are payable
or paid by the Administrative Agent in connection with any Loan Document, and
any reasonable expenses arising therefrom or with respect thereto, whether or
not such Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to any Lender by the Administrative Agent shall be
conclusive absent manifest error. Each Lender hereby authorizes the
Administrative Agent to set off and apply any and all amounts at any time owing
to such Lender under any Loan Document or otherwise payable by the
Administrative Agent to the Lender from any other source against any amount due
to the Administrative Agent under this subsection (e).

 

(f) Evidence of Payments. As soon as practicable after any payment of Taxes by
the Borrower or any Guarantor to a Governmental Authority pursuant to this
Section, the Borrower or such Guarantor shall deliver to the Administrative
Agent the original or a certified copy of a receipt issued by such Governmental
Authority evidencing such payment, a copy of the return reporting such payment
or other evidence of such payment reasonably satisfactory to the Administrative
Agent.

 

(g) Status of Lenders. (i) Any Lender that is entitled to an exemption from or
reduction of withholding Tax with respect to payments made under any Loan
Document shall deliver to the Borrower and the Administrative Agent, at the time
or times reasonably requested by the Borrower or the Administrative Agent, such
properly completed and executed documentation reasonably requested by the
Borrower or the Administrative Agent as will permit such payments to be made
without withholding or at a reduced rate of withholding. In addition, any
Lender, if reasonably requested by the Borrower or the Administrative Agent,
shall deliver such other documentation prescribed by applicable law or
reasonably requested by the Borrower or the Administrative Agent as will enable
the Borrower or the Administrative Agent to determine whether or not such Lender
is subject to backup withholding or information reporting requirements.
Notwithstanding anything to the contrary in the preceding two sentences, the
completion, execution and submission of such documentation (other than such
documentation set forth in Section 12.1(g)(ii)(A), (ii)(B) and (ii)(D) below)
shall not be required if in the Lender’s reasonable judgment such completion,
execution or submission would subject such Lender to any material unreimbursed
cost or expense or would materially prejudice the legal or commercial position
of such Lender.

 

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(ii) Without limiting the generality of the foregoing:

 

(A) any Lender that is a U.S. Person shall deliver to the Borrower and the
Administrative Agent on or prior to the date on which such Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the
reasonable request of the Borrower or the Administrative Agent), executed
originals of IRS Form W-9 certifying that such Lender is exempt from U.S.
federal backup withholding tax;

 

(B) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), whichever of the following is applicable:

 

(i) in the case of a Foreign Lender claiming the benefits of an income tax
treaty to which the United States is a party (x) with respect to payments of
interest under any Loan Document, executed originals of IRS Form W-8BEN
establishing an exemption from, or reduction of, U.S. federal withholding Tax
pursuant to the “interest” article of such tax treaty and (y) with respect to
any other applicable payments under any Loan Document, IRS Form W-8BEN
establishing an exemption from, or reduction of, U.S. federal withholding Tax
pursuant to the “business profits” or “other income” article of such tax treaty;

 

(ii) executed originals of IRS Form W-8ECI;

 

(iii) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code, (x) a certificate
substantially in the form of Exhibit I-1 to the effect that such Foreign Lender
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10
percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B)
of the Code, or a “controlled foreign corporation” described in Section
881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed
originals of IRS Form W-8BEN; or

 

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(iv) to the extent a Foreign Lender is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a
U.S. Tax Compliance Certificate substantially in the form of Exhibit I-2 or
Exhibit I-3, IRS Form W-9, and/or other certification documents from each
beneficial owner, as applicable; provided that if the Foreign Lender is a
partnership and one or more direct or indirect partners of such Foreign Lender
are claiming the portfolio interest exemption, such Foreign Lender may provide a
U.S. Tax Compliance Certificate substantially in the form of Exhibit I-4 on
behalf of each such direct and indirect partner;

 

(C) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), executed originals of any other form prescribed by applicable law as a
basis for claiming exemption from or a reduction in U.S. federal withholding
Tax, duly completed, together with such supplementary documentation as may be
prescribed by applicable law to permit the Borrower or the Administrative Agent
to determine the withholding or deduction required to be made; and

 

(D) if a payment made to a Lender under any Loan Document would be subject to
U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to
comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender
shall deliver to the Borrower and the Administrative Agent at the time or times
prescribed by law and at such time or times reasonably requested by the Borrower
or the Administrative Agent such documentation prescribed by applicable law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrower or the
Administrative Agent as may be necessary for the Borrower and the Administrative
Agent to comply with their obligations under FATCA and to determine that such
Lender has complied with such Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this
clause (D), “FATCA” shall include any amendments made to FATCA after the date of
this Agreement.

 

Each Lender agrees that if any form or certification it previously delivered
expires or becomes obsolete or inaccurate in any respect, it shall update such
form or certification or promptly notify the Borrower and the Administrative
Agent in writing of its legal inability to do so.

 

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(h) Treatment of Certain Refunds. If any party determines, in its sole
discretion exercised in good faith, that it has received a refund of any Taxes
as to which it has been indemnified pursuant to this Section (including by the
payment of additional amounts pursuant to this Section), it shall pay to the
indemnifying party an amount equal to such refund (but only to the extent of
indemnity payments made under this Section with respect to the Taxes giving rise
to such refund), net of all out-of-pocket expenses (including Taxes) of such
indemnified party and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund). Such indemnifying
party, upon the request of such indemnified party, shall repay to such
indemnified party the amount paid over pursuant to this subsection (h) (plus any
penalties, interest or other charges imposed by the relevant Governmental
Authority) in the event that such indemnified party is required to repay such
refund to such Governmental Authority. Notwithstanding anything to the contrary
in this subsection (h), in no event will the indemnified party be required to
pay any amount to an indemnifying party pursuant to this subsection (h) the
payment of which would place the indemnified party in a less favorable net
after-Tax position than the indemnified party would have been in if the Tax
subject to indemnification had not been deducted, withheld or otherwise imposed
and the indemnification payments or additional amounts giving rise to such
refund had never been paid. This subsection shall not be construed to require
any indemnified party to make available its Tax returns (or any other
information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.

 

(i) Survival. Each party’s obligations under this Section shall survive the
resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender, the termination of the Commitments
and the repayment, satisfaction or discharge of all obligations under any Loan
Document.

 

Section 12.2. Other Taxes. The Borrower shall timely pay to the relevant
Governmental Authority in accordance with applicable law, or at the option of
the Administrative Agent timely reimburse it for the payment of, any Other
Taxes.

 

Section 12.3. No Waiver, Cumulative Remedies. No delay or failure on the part of
the Administrative Agent, the L/C Issuer, or any Lender, or on the part of the
holder or holders of any of the Obligations, in the exercise of any power or
right under any Loan Document shall operate as a waiver thereof or as an
acquiescence in any default, nor shall any single or partial exercise of any
power or right preclude any other or further exercise thereof or the exercise of
any other power or right. The rights and remedies hereunder of the
Administrative Agent, the L/C Issuer, the Lenders, and of the holder or holders
of any of the Obligations are cumulative to, and not exclusive of, any rights or
remedies which any of them would otherwise have.

 

Section 12.4. Non-Business Days. Subject to the definition of Interest Period,
if any payment hereunder becomes due and payable on a day which is not a
Business Day, the due date of such payment shall be extended to the next
succeeding Business Day on which date such payment shall be due and payable. In
the case of any payment of principal falling due on a day which is not a
Business Day, interest on such principal amount shall continue to accrue during
such extension at the rate per annum then in effect, which accrued amount shall
be due and payable on the next scheduled date for the payment of interest.

 

Section 12.5. Survival of Representations. All representations and warranties
made herein or in any other Loan Document or in certificates given pursuant
hereto or thereto shall survive the execution and delivery of this Agreement and
the other Loan Documents, and shall continue in full force and effect with
respect to the date as of which they were made as long as any credit is in use
or available hereunder.

 

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Section 12.6. Survival of Indemnities. All indemnities and other provisions
relative to reimbursement to the Lenders and L/C Issuer of amounts sufficient to
protect the yield of the Lenders and L/C Issuer with respect to the Loans and
Letters of Credit, including, but not limited to, Sections 1.11, 10.3, and 12.15
hereof, shall survive the termination of this Agreement and the other Loan
Documents and the payment of the Obligations.

 

Section 12.7. Sharing of Set-Off. Each Lender agrees with each other Lender a
party hereto that if such Lender shall receive and retain any payment, whether
by set-off or application of deposit balances or otherwise, on any of the Loans
or Reimbursement Obligations in excess of its ratable share of payments on all
such Obligations then outstanding to the Lenders, then such Lender shall
purchase for cash at face value, but without recourse, ratably from each of the
other Lenders such amount of the Loans or Reimbursement Obligations, or
participations therein, held by each such other Lenders (or interest therein) as
shall be necessary to cause such Lender to share such excess payment ratably
with all the other Lenders; provided, however, that if any such purchase is made
by any Lender, and if such excess payment or part thereof is thereafter
recovered from such purchasing Lender, the related purchases from the other
Lenders shall be rescinded ratably and the purchase price restored as to the
portion of such excess payment so recovered, but without interest. For purposes
of this Section 12.7, amounts owed to or recovered by the L/C Issuer in
connection with Reimbursement Obligations in which Lenders have been required to
fund their participation shall be treated as amounts owed to or recovered by the
L/C Issuer as a Lender hereunder.

 

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Section 12.8. Notices. Except as otherwise specified herein, all notices
hereunder and under the other Loan Documents shall be in writing (including,
without limitation, notice by telecopy) and shall be given to the relevant party
at its address or facsimile number set forth below, or such other address or
facsimile number as such party may hereafter specify by notice to the
Administrative Agent and the Borrower given by courier, by United States
certified or registered mail, by telecopy or by other telecommunication device
capable of creating a written record of such notice and its receipt. Notices
under the Loan Documents to any Lender shall be addressed to its address or
facsimile number set forth on its Administrative Questionnaire; and notices
under the Loan Documents to the Borrower, any Guarantor, the Administrative
Agent, or L/C Issuer shall be addressed to its respective address or facsimile
number set forth below:

 

to the Borrower or any Guarantor:

 

UMH Properties, Inc.

3499 Route 9 North, Suite 3C

Juniper Business Plaza

Freehold, New Jersey 07728

Attention: Anna Chew

Telephone: (732) 577-4033

Email: achew@umh.com

Fax: (732) 577-9980

 

with a copy to:

 

Perkins Coie LLP

131 S. Dearborn Street, Suite 1700

Chicago, Illinois 60603

Attention: Matthew Shebuski, Esq.

Telephone: (312) 324-8437

Email: mshebuski@perkinscoie.com

Fax: (312) 324-9437

to the Administrative Agent or L/C Issuer:

 

Bank of Montreal

115 South LaSalle Street

Chicago, Illinois 60603

Attention: Lloyd Baron

Telephone: 312-461-6812

Email: llyod.baron@bmo.com

Fax: (312) 293-8409

 

Each such notice, request or other communication shall be effective (i) if given
by facsimile, when such facsimile is delivered to the facsimile number specified
in this Section 12.8 or in the relevant Administrative Questionnaire and a
confirmation of such facsimile has been received by the sender, (ii) if given by
mail, upon receipt or first refusal of delivery or (iii) if given by any other
means, when delivered at the addresses specified in this Section 12.8 or in the
relevant Administrative Questionnaire; provided that any notice given pursuant
to Section 1 hereof shall be effective only upon receipt.

 

Section 12.9. Counterparts; Integration; Effectiveness.. (a) Counterparts;
Integration; Effectiveness. This Agreement may be executed in counterparts (and
by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. This Agreement and the other Loan Documents, and any separate
letter agreements with respect to fees payable to the Administrative Agent,
constitute the entire contract among the parties relating to the subject matter
hereof and supersede any and all previous agreements and understandings, oral or
written, relating to the subject matter hereof. Except as provided in Section
7.2, this Agreement shall become effective when it shall have been executed by
the Administrative Agent and when the Administrative Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto. Delivery of an executed counterpart of a signature
page of this Agreement by facsimile or in electronic (e.g., “pdf” or “tif”)
format shall be effective as delivery of a manually executed counterpart of this
Agreement. For purposes of determining compliance with the conditions specified
in Section 7.2 hereof, each Lender and L/C Issuer that has signed this Agreement
shall be deemed to have consented to, approved or accepted or to be satisfied
with, each document or other matter required thereunder to be consented to or
approved by or acceptable or satisfactory to a Lender or L/C Issuer unless the
Administrative Agent shall have received notice from such Lender or L/C Issuer
prior to the Closing Date specifying its objection thereto.

 

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(b) Electronic Execution of Assignments. The words “execution,” “signed,”
“signature,” and words of like import in any Assignment and Assumption shall be
deemed to include electronic signatures or the keeping of records in electronic
form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable Legal Requirements, including the Federal Electronic Signatures
in Global and National Commerce Act, the Illinois State Electronic Commerce
Security Act, or any other similar state laws based on the Uniform Electronic
Transactions Act.

 

Section 12.10. Successors and Assigns. This Agreement shall be binding upon the
Borrower and the Guarantors and their successors and assigns, and shall inure to
the benefit of the Administrative Agent, the L/C Issuer, and each of the
Lenders, and the benefit of their respective successors and assigns, including
any subsequent holder of any of the Obligations. The Borrower and the Guarantors
may not assign any of their rights or obligations under any Loan Document
without the written consent of all of the Lenders and, with respect to any
Letter of Credit or the Application therefor, the L/C Issuer.

 

Section 12.11. Participants. Each Lender shall have the right at its own cost to
grant participations (to be evidenced by one or more agreements or certificates
of participation) in the Loans made and Reimbursement Obligations and/or
Commitments held by such Lender at any time and from time to time to one or more
other Persons; provided that no such participation shall relieve any Lender of
any of its obligations under this Agreement, and, provided, further that no such
participant shall have any rights under this Agreement except as provided in
this Section 12.11, and the Administrative Agent shall have no obligation or
responsibility to such participant. Any agreement pursuant to which such
participation is granted shall provide that the granting Lender shall retain the
sole right and responsibility to enforce the obligations of the Borrower under
this Agreement and the other Loan Documents including, without limitation, the
right to approve any amendment, modification or waiver of any provision of the
Loan Documents, except that such agreement may provide that such Lender will not
agree to any modification, amendment or waiver of the Loan Documents that would
reduce the amount of or postpone any fixed date for payment of any Obligation in
which such participant has an interest. Any party to which such a participation
has been granted shall have the benefits of Section 1.11 and Section 10.3
hereof. The Borrower and each Guarantor authorizes each Lender to disclose to
any participant or prospective participant under this Section 12.11 any
financial or other information pertaining to each Guarantor, the Borrower or any
Subsidiary, provided that such participant or prospective participant shall be
subject to the provisions of Section 12.25.

 

Section 12.12. Assignments. (a) Any Lender may at any time assign to one or more
Eligible Assignees all or a portion of such Lender’s rights and obligations
under this Agreement (including all or a portion of its Commitment and the Loans
at the time owing to it); provided that any such assignment shall be subject to
the following conditions:

 

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(i) Minimum Amounts. (A) In the case of an assignment of the entire remaining
amount of the assigning Lender’s Commitment and the Loans and participation
interest in L/C Obligations at the time owing to it or in the case of an
assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum
amount need be assigned; and (B) in any case not described in subsection
(a)(i)(A) of this Section 12.12, the aggregate amount of the Commitment (which
for this purpose includes Loans and participation interest in L/C Obligations
outstanding thereunder) or, if the applicable Commitment is not then in effect,
the principal outstanding balance of the Loans and participation interest in L/C
Obligations of the assigning Lender subject to each such assignment (determined
as of the date the Assignment and Acceptance with respect to such assignment is
delivered to the Administrative Agent or, if “Effective Date” is specified in
the Assignment and Acceptance, as of the Effective Date specified in such
Assignment and Acceptance) shall not be less than $5,000,000 unless each of the
Administrative Agent and, so long as no Event of Default has occurred and is
continuing, the Borrower otherwise consents (each such consent not to be
unreasonably withheld or delayed);

 

(ii) Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loans or the Commitments.

 

(iii) Required Consents. No consent shall be required for any assignment except
to the extent required by Section 12.12(a)(i)(B) and, in addition:

 

(a) the consent of the Borrower (such consent not to be unreasonably withheld or
delayed) shall be required unless (x) an Event of Default has occurred and is
continuing at the time of such assignment or (y) such assignment is to a Lender,
an Affiliate of a Lender or an Approved Fund; provided that the Borrower shall
be deemed to have consented to any such assignment unless it shall object
thereto by written notice to the Administrative Agent within five (5) Business
Days after having received notice thereof;

 

(b) the consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed) shall be required if such assignment is to a Person that is
not a Lender with a Commitment, an Affiliate of such Lender or an Approved Fund
with respect to such Lender; and

 

(c) the consent of the L/C Issuer (such consent not to be unreasonably withheld
or delayed) shall be required for any assignment that increases the obligation
of the assignee to participate in exposure under one or more Letters of Credit
(whether or not then outstanding).

 

(iv) Assignment and Acceptance. The parties to each assignment shall execute and
deliver to the Administrative Agent an Assignment and Acceptance, together with
a processing and recordation fee of $3,500, and the assignee, if it is not a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.

 

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(v) No Assignment to Borrower, Guarantors, Affiliates or Defaulting Lenders. No
such assignment shall be made to the Borrower, any Subsidiary or any other
Affiliate of the Borrower, or to a Defaulting Lender.

 

(vi) No Assignment to Natural Persons. No such assignment shall be made to a
natural person.

 

(vii) Notice to Borrower. Whether or not the consent of the Borrower is required
under clause (iii) above with respect to any assignment, the Administrative
Agent shall give the Borrower notice of such assignment promptly following the
consummation thereof.

 

Subject to acceptance and recording thereof by the Administrative Agent pursuant
to Section 12.12(b) hereof, from and after the effective date specified in each
Assignment and Acceptance, the assignee thereunder shall be a party to this
Agreement and, to the extent of the interest assigned by such Assignment and
Acceptance, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Acceptance, be released from its obligations
under this Agreement (and, in the case of an Assignment and Acceptance covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto) but shall continue to be entitled to
the benefits of Sections 12.6 and 12.15 with respect to facts and circumstances
occurring prior to the effective date of such assignment. Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does not
comply with this Section shall be treated for purposes of this Agreement as a
sale by such Lender of a participation in such rights and obligations in
accordance with Section 12.11 hereof.

 

(b) Register. The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at one of its offices in Chicago,
Illinois, a copy of each Assignment and Acceptance delivered to it and a
register for the recordation of the names and addresses of the Lenders, and the
Commitments of, and principal amounts of the Loans owing to, each Lender
pursuant to the terms hereof from time to time (the “Register”). The entries in
the Register shall be conclusive absent manifest error, and the Borrower, the
Administrative Agent, and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior notice. Each
Lender or L/C Issuer that grants a participation as described in Section 12.11
shall, acting solely for this purpose as an agent of the Borrower, maintain a
register on which it enters the name and address of each participant and the
principal amounts (and stated interest) of each participant’s interest in the
Loans made and Reimbursement Obligations and/or Commitments or other obligations
under this Agreement (the “Participant Register”); provided that no Lender or
L/C Issuer shall have any obligation to disclose all or any portion of the
Participant Register to any Person (including the identity of any participant or
any information relating to a participant’s interest in any Loans made and
Reimbursement Obligations and/or Commitments or other obligations under this
Agreement) except to the extent that such disclosure is necessary to establish
that such Obligation or Commitment is in registered form under Section
5f.103-1(c) of the Treasury Regulations or is otherwise required by this
Agreement. The entries in the Participant Register shall be conclusive absent
manifest error, and such Lender or L/C Issuer shall treat each person whose name
is recorded in the Participant Register as the owner of such participation for
all purposes of this Agreement notwithstanding any notice to the contrary.

 

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(c) Any Lender may at any time pledge or grant a security interest in all or any
portion of its rights under this Agreement to secure obligations of such Lender,
including any such pledge or grant to a Federal Reserve Bank, and this Section
12.12 shall not apply to any such pledge or grant of a security interest;
provided that no such pledge or grant of a security interest shall release a
Lender from any of its obligations hereunder or substitute any such pledgee or
secured party for such Lender as a party hereto; provided further, however, the
right of any such pledgee or grantee (other than any Federal Reserve Bank) to
further transfer all or any portion of the rights pledged or granted to it,
whether by means of foreclosure or otherwise, shall be at all times subject to
the terms of this Agreement.

 

Section 12.13. Amendments. Any provision of this Agreement or the other Loan
Documents may be amended or waived if, but only if, such amendment or waiver is
in writing and is signed by (a) the Borrower, (b) the Required Lenders (or the
Administrative Agent acting at the direction of the Required Lenders), and (c)
if the rights or duties of the Administrative Agent or the L/C Issuer are
affected thereby, the Administrative Agent or the L/C Issuer, as applicable;
provided that:

 

(i) no amendment or waiver pursuant to this Section 12.13 shall (A) increase any
Commitment of any Lender without the consent of such Lender or (B) reduce the
amount of or postpone the date for any scheduled payment of any principal of or
interest on any Loan or of any Reimbursement Obligation or of any fee payable
hereunder without the consent of the Lender to which such payment is owing or
which has committed to make such Loan or Letter of Credit (or participate
therein) hereunder;

 

(ii) no amendment or waiver pursuant to this Section 12.13 shall, unless signed
by each Lender, change the definition of Required Lenders, change the provisions
of this Section 12.13, change Section 12.7 in a manner that would affect the
ratable sharing of setoffs required thereby, change the application of payments
contained in Section 1.14(a)(iii), 2.1 or 3.1, or affect the number of Lenders
required to take any action hereunder or under any other Loan Document;

 

(iii) no amendment or waiver pursuant to this Section 12.13 shall, unless signed
by each Lender, extend the Termination Date, release the Borrower or any
Guarantor (expect as provided for in this Agreement), change Section 1.12 in a
manner that would alter the ratable reduction of Commitments or the pro rata
sharing of payments required thereby, change the definition of Required Lenders,
change the provisions of this Section 12.13, or affect the number of Lenders
required to take any action hereunder or under any other Loan Document; and

 

(iv) no amendment to Section 13 hereof shall be made without the consent of the
Guarantors affected thereby.

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Notwithstanding anything to the contrary herein, (1) no Defaulting Lender shall
have any right to approve or disapprove any amendment, waiver or consent
hereunder (and any amendment, waiver or consent which by its terms requires the
consent of all Lenders or each affected Lender may be effected with the consent
of the applicable Lenders other than Defaulting Lenders), except that (x) the
Commitments of any Defaulting Lender may not be increased or extended without
the consent of such Lender and (y) any waiver, amendment or modification
requiring the consent of all Lenders or each affected Lender that by its terms
affects any Defaulting Lender more adversely than other affected Lenders shall
require the consent of such Defaulting Lender, (2) if the Administrative Agent
and the Borrower have jointly identified an obvious error or any error or
omission of a technical nature, in each case, in any provision of the Loan
Documents, then the Administrative Agent and the Borrower shall be permitted to
amend such provision, and (3) guarantees and related documents executed by the
Borrower or any Guarantor in connection with this Agreement may be in a form
reasonably determined by the Administrative Agent and may be amended,
supplemented or waived without the consent of any Lender if such amendment,
supplement or waiver is delivered in order to (x) comply with local law or
advice of local counsel, (y) cure ambiguities, omissions, mistakes or defects or
(z) cause such guarantee or other document to be consistent with this Agreement
and the other Loan Documents.

 

Section 12.14. Headings. Section headings used in this Agreement are for
reference only and shall not affect the construction of this Agreement.

 

Section 12.15. Costs and Expenses; Indemnification. (a) The Borrower agrees to
pay all reasonable and documented out-of-pocket costs and expenses of the
Administrative Agent in connection with the preparation, negotiation,
syndication, and administration of the Loan Documents, including, without
limitation, the reasonable and documented out-of-pocket fees and disbursements
of counsel to the Administrative Agent), in connection with the preparation and
execution of the Loan Documents, and any amendment, waiver or consent related
thereto, whether or not the transactions contemplated herein are consummated.
The Borrower agrees to pay to the Administrative Agent, the L/C Issuer, each
Lender, and any other holder of any Obligations outstanding hereunder, all
documented out-of-pocket costs and expenses reasonably incurred or paid by the
Administrative Agent, the L/C Issuer, such Lender, or any such holder, including
reasonable and documented out-of-pocket attorneys’ fees and disbursements and
court costs, in connection with any Default or Event of Default hereunder or in
connection with the enforcement of any of the Loan Documents (including all such
costs and expenses incurred in connection with any proceeding under the United
States Bankruptcy Code involving the Borrower or any Guarantor as a debtor
thereunder). The Borrower further agrees to indemnify the Administrative Agent,
the L/C Issuer, each Lender, and any security trustee therefor, and their
respective directors, officers, employees, agents, financial advisors, and
consultants (each such Person being called an “Indemnitee”) against all losses,
claims, damages, penalties, judgments, liabilities and expenses (including,
without limitation, all reasonable and documented out-of-pocket fees and
disbursements of counsel for any such Indemnitee and all reasonable and
documented out-of-pocket expenses of litigation or preparation therefor, whether
or not the Indemnitee is a party thereto, or any settlement arrangement arising
from or relating to any such litigation) which any of them may pay or incur
arising out of or relating to any Loan Document or any of the transactions
contemplated thereby or the direct or indirect application or proposed
application of the proceeds of any Loan or Letter of Credit, other than other
than (i) those which arise from the gross negligence or willful misconduct of
the party claiming indemnification, (ii) a material breach of such Indemnitee’s
obligations under the Loan Documents, as determined in a final non-appealable
judgment of a court of competent jurisdiction or (iii) any dispute solely among
Indemnitees (provided, that the Borrower agrees to indemnify the Administrative
Agent in any such dispute between the Administrative Agent and any Lender). The
Borrower, upon demand by the Administrative Agent, the L/C Issuer, or a Lender
at any time, shall reimburse the Administrative Agent, the L/C Issuer, or such
Lender for any reasonable legal or other expenses (including, without
limitation, all reasonable fees and disbursements of counsel for any such
Indemnitee) incurred in connection with investigating or defending against any
of the foregoing (including any settlement costs relating to the foregoing)
except to the extent the same is due to the gross negligence or willful
misconduct of the party to be indemnified. To the extent permitted by applicable
Legal Requirements, the Borrower and the Guarantors shall not assert, and each
hereby waives, any claim against any Indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this
Agreement or the other Loan Documents or any agreement or instrument
contemplated hereby or thereby, the transactions contemplated hereby or thereby,
any Loan or Letter of Credit or the use of the proceeds thereof. The obligations
of the parties under this Section 12.15 shall survive the termination of this
Agreement.

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(b) The Borrower unconditionally agrees to forever indemnify, defend and hold
harmless, and covenants not to sue for any claim for contribution against, each
Indemnitee for any damages, loss or reasonable and documented out-of-pocket
costs and expenses, including without limitation, response, remedial or removal
costs and all reasonable and documented out-of-pocket fees and disbursements of
counsel for any such Indemnitee, arising out of any of the following: (i) any
Hazardous Material Activity at any of the Real Properties, (ii) the violation of
any Environmental Law by the Borrower or any Subsidiary or otherwise occurring
on or with respect to any Real Property, (iii) any claim for personal injury or
property damage in connection with the Borrower or any Subsidiary or otherwise
occurring on or with respect to any Real Property, and (iv) the inaccuracy or
breach of any environmental representation, warranty or covenant by the Borrower
or any Subsidiary made herein or in any other Loan Document evidencing or
securing any Obligations or setting forth terms and conditions applicable
thereto or otherwise relating thereto, except for damages arising from the
willful misconduct or gross negligence of the relevant Indemnitee. This
indemnification shall survive the payment and satisfaction of all Obligations
and the termination of this Agreement for a period of five (5) years, and shall
remain in force beyond the expiration of any applicable statute of limitations
and payment or satisfaction in full of any single claim under this
indemnification. This indemnification shall be binding upon the successors and
assigns of the Borrower and shall inure to the benefit of each Indemnitee and
its successors and assigns.

 

Section 12.16. Set-off. In addition to any rights now or hereafter granted under
the Loan Documents or applicable Legal Requirements and not by way of limitation
of any such rights, during the continuance of any Event of Default, with the
prior written consent of the Administrative Agent, each Lender, the L/C Issuer,
each subsequent holder of any Obligation, and each of their respective
affiliates, is hereby authorized by the Borrower and each Guarantor at any time
or from time to time, without notice to the Borrower or such Guarantor or to any
other Person, any such notice being hereby expressly waived, to set-off and to
appropriate and to apply any and all deposits (general or special, including,
but not limited to, indebtedness evidenced by certificates of deposit, whether
matured or unmatured, and in whatever currency denominated, but not including
trust accounts) and any other indebtedness at any time held or owing by that
Lender, L/C Issuer, subsequent holder, or affiliate, to or for the credit or the
account of the Borrower or such Guarantor, whether or not matured, against and
on account of the Obligations then due to that Lender, L/C Issuer, or subsequent
holder under the Loan Documents, including, but not limited to, all claims of
any nature or description arising out of or connected with the Loan Documents,
irrespective of whether or not (a) that Lender, L/C Issuer, or subsequent holder
shall have made any demand hereunder or (b) the principal of or the interest on
the Loans and other amounts due hereunder shall have become due and payable
pursuant to Section 9 and although said obligations and liabilities, or any of
them, may be contingent or unmatured.

 

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Section 12.17. Entire Agreement. The Loan Documents constitute the entire
understanding of the parties thereto with respect to the subject matter thereof
and any prior agreements, whether written or oral, with respect thereto are
superseded hereby.

 

Section 12.18. Waiver of Jury Trial. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by applicable Legal Requirements, any
right it may have to a trial by jury in any legal proceeding directly or
indirectly arising out of or relating to any Loan Document or the transactions
contemplated thereby (whether based on contract, tort or any other theory). Each
party hereto (a) certifies that no representative, agent or attorney of any
other party has represented, expressly or otherwise, that such other party would
not, in the event of litigation, seek to enforce the foregoing waiver and (b)
acknowledges that it and the other parties hereto have been induced to enter
into this Agreement by, among other things, the mutual waivers and
certifications in this Section.

 

Section 12.19. Severability of Provisions. Any provision of any Loan Document
which is unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such unenforceability without invalidating the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction. All rights, remedies and powers provided in
this Agreement and the other Loan Documents may be exercised only to the extent
that the exercise thereof does not violate any applicable mandatory provisions
of law, and all the provisions of this Agreement and other Loan Documents are
intended to be subject to all applicable mandatory provisions of law which may
be controlling and to be limited to the extent necessary so that they will not
render this Agreement or any of the other Loan Documents invalid or
unenforceable.

 

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Section 12.20. Excess Interest. Notwithstanding any provision to the contrary
contained herein or in any other Loan Document, no such provision shall require
the payment or permit the collection of any amount of interest in excess of the
maximum amount of interest permitted by applicable Legal Requirements to be
charged for the use or detention, or the forbearance in the collection, of all
or any portion of the Loans or other obligations outstanding under this
Agreement or any other Loan Document (“Excess Interest”). If any Excess Interest
is provided for, or is adjudicated to be provided for, herein or in any other
Loan Document, then in such event (a) the provisions of this Section 12.20 shall
govern and control, (b) neither the Borrower nor any guarantor or endorser shall
be obligated to pay any Excess Interest, (c) any Excess Interest that the
Administrative Agent or any Lender may have received hereunder shall, at the
option of the Administrative Agent, be (i) applied as a credit against the then
outstanding principal amount of Obligations hereunder and accrued and unpaid
interest thereon (not to exceed the maximum amount permitted by applicable Legal
Requirements), (ii) refunded to the Borrower, or (iii) any combination of the
foregoing, (d) the interest rate payable hereunder or under any other Loan
Document shall be automatically subject to reduction to the maximum lawful
contract rate allowed under applicable usury laws (the “Maximum Rate”), and this
Agreement and the other Loan Documents shall be deemed to have been, and shall
be, reformed and modified to reflect such reduction in the relevant interest
rate, and (e) neither the Borrower nor any guarantor or endorser shall have any
action against the Administrative Agent or any Lender for any damages whatsoever
arising out of the payment or collection of any Excess Interest. Notwithstanding
the foregoing, if for any period of time interest on any of Borrower’s
Obligations is calculated at the Maximum Rate rather than the applicable rate
under this Agreement, and thereafter such applicable rate becomes less than the
Maximum Rate, the rate of interest payable on the Borrower’s Obligations shall
remain at the Maximum Rate until the Lenders have received the amount of
interest which such Lenders would have received during such period on the
Borrower’s Obligations had the rate of interest not been limited to the Maximum
Rate during such period.

 

Section 12.21. Construction. The parties acknowledge and agree that the Loan
Documents shall not be construed more favorably in favor of any party hereto
based upon which party drafted the same, it being acknowledged that all parties
hereto contributed substantially to the negotiation of the Loan Documents. The
provisions of this Agreement relating to Subsidiaries shall only apply during
such times as the Borrower has one or more Subsidiaries.

 

Section 12.22. Lender’s and L/C Issuer’s Obligations Several. The obligations of
the Lenders and L/C Issuer hereunder are several and not joint. Nothing
contained in this Agreement and no action taken by the Lenders or L/C Issuer
pursuant hereto shall be deemed to constitute the Lenders and L/C Issuer a
partnership, association, joint venture or other entity.

 

Section 12.23. Governing Law; Jurisdiction; Consent to Service of Process. (a)
This agreement, the Notes and the other Loan Documents (except as otherwise
specified therein), and the rights and duties of the parties hereto, shall be
construed and determined in accordance with the laws of the State of Illinois
without regard to conflicts of law principles that would require application of
the laws of another jurisdiction.

 

(b) Each party hereto hereby irrevocably and unconditionally submits, for itself
and its property, to the nonexclusive jurisdiction of the United States District
Court for the Northern District of Illinois and of any Illinois State court
sitting in the City of Chicago, and any appellate court from any thereof, in any
action or proceeding arising out of or relating to any Loan Document, or for
recognition or enforcement of any judgment, and each party hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such Illinois State court
or, to the extent permitted by applicable Legal Requirements, in such federal
court. Each party hereto hereby agrees that a final judgment in any such action
or proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by applicable Legal
Requirements. Nothing in this Agreement or any other Loan Document or otherwise
shall affect any right that any party hereto may otherwise have to bring any
action or proceeding relating to this Agreement or any other Loan Document
against the Borrower or any Guarantor or its respective properties in the courts
of any jurisdiction.

 

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(c) Each party hereto hereby irrevocably and unconditionally waives, to the
fullest extent permitted by applicable Legal Requirements, any objection which
it may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any other Loan
Document in any court referred to in Section 12.23(b). Each party hereto hereby
irrevocably waives, to the fullest extent permitted by applicable Legal
Requirements, the defense of an inconvenient forum to the maintenance of such
action or proceeding in any such court.

 

(d) Each party to this Agreement irrevocably consents to service of process in
any action or proceeding arising out of or relating to any Loan Document, in the
manner provided for notices (other than telecopy or e-mail) in Section 12.8.
Nothing in this Agreement or any other Loan Document will affect the right of
any party to this Agreement to serve process in any other manner permitted by
applicable Legal Requirements.

 

Section 12.24. USA Patriot Act. Each Lender and L/C Issuer that is subject to
the requirements of the Patriot Act hereby notifies the Borrower that pursuant
to the requirements of the Act, it is required to obtain, verify, and record
information that identifies the Borrower, which information includes the name
and address of the Borrower and other information that will allow such Lender or
L/C Issuer to identify the Borrower in accordance with the Patriot Act.

 

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Section 12.25. Confidentiality. Each of the Administrative Agent, the Lenders,
and the L/C Issuer severally agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed (a) to
its and its Affiliates’ directors, officers, employees and agents, including
accountants, legal counsel and other advisors to the extent any such Person has
a need to know such Information (it being understood that the Persons to whom
such disclosure is made will first be informed of the confidential nature of
such Information and instructed to keep such Information confidential), (b) to
the extent requested by any regulatory authority (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable Legal Requirements or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with the
exercise of any remedies hereunder or under any other Loan Document or any suit,
action or proceeding relating to this Agreement or any other Loan Document or
the enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section 12.25, to
(A) any assignee of or participant in, or any prospective assignee of or
participant in, any of its rights or obligations under this Agreement or (B) any
actual or prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Borrower or any Subsidiary and its obligations, (g)
with the prior written consent of the Borrower, (h) to the extent such
Information (A) becomes publicly available other than as a result of a breach of
this Section 12.25 or (B) becomes available to the Administrative Agent, any
Lender or the L/C Issuer on a non-confidential basis from a source other than
the Borrower or any Subsidiary or any of their directors, officers, employees or
agents, including accountants, legal counsel and other advisors; (i) to rating
agencies if requested or required by such agencies in connection with a rating
relating to the Loans or the Commitments hereunder, (j) to Gold Sheets and other
similar bank trade publications (such information to consist solely of deal
terms and other information regarding the credit facilities evidenced by this
Agreement customarily found in such publications), or (k) to entities which
compile and publish information about the syndicated loan market, provided that
only basic information about the pricing and structure of the transaction
evidenced hereby may be disclosed pursuant to this subsection (k). For purposes
of this Section 12.25, “Information” means all information received from the
Borrower or any of the Subsidiaries or from any other Person on behalf of the
Borrower or any Subsidiary relating to the Borrower or any Subsidiary or any of
their respective businesses, other than any such information that is available
to the Administrative Agent, any Lender or the L/C Issuer on a non-confidential
basis prior to disclosure by the Borrower or any of its Subsidiaries or from any
other Person on behalf of the Borrower or any of the Subsidiaries.

 

Section 12.26. Limitation of Recourse. There shall be full recourse to the
Borrower and the Guarantors and all of their assets and properties for the
Obligations and any other liability under the Loan Documents. Subject to clauses
(i) and (ii) of the following sentence, in no event shall any directors,
officers, employees or agents of the Borrower or any of its Subsidiaries be
personally liable or obligated for the Obligations or any other liability under
the Loan Documents. Nothing herein contained shall limit or be construed to (i)
release any such director, officer, employee or agent from liability for his or
her fraudulent actions, misappropriation of funds or willful misconduct or (ii)
limit or impair the exercise of remedies with respect to the Borrower and the
Guarantors under the Loan Documents. The provisions of this Section 12.26 shall
survive the termination of this Agreement.

 

Section 12.27. Amendment and Restatement. This Agreement shall become effective
on the Effective Date and shall supersede all provisions of the Existing Credit
Agreement as of such date. From and after the Effective Date all references made
to the Existing Credit Agreement in any Loan Document or in any other instrument
or document shall, without more, be deemed to refer to this Agreement. This
Agreement amends and restates the Existing Credit Agreement and is not intended
to be or operate as a novation or an accord and satisfaction of the Existing
Credit Agreement or the indebtedness, obligations and liabilities of the
Borrower or the Guarantors evidenced or provided for thereunder.

 

Section 12.28. Equalization of Loans and Commitments. Upon the satisfaction of
the conditions precedent set forth in Section 7.2 hereof, all loans outstanding
under the Existing Credit Agreement shall remain outstanding as the initial
Borrowing of Loans under this Agreement and, in connection therewith, the
Borrowers shall be deemed to have prepaid all outstanding Eurodollar Loans on
the Effective Date and shall pay to each Lender who is currently a party to the
Existing Credit Agreement any compensation due such Lender under Section 1.11 of
the Existing Credit Agreement as a result thereof. On the Effective Date, the
Lenders each agree to make such purchases and sales of interests in the
outstanding Loans between themselves so that each Lender is then holding its
relevant Percentage of outstanding Loans. Such purchases and sales shall be
arranged through the Administrative Agent and each Lender hereby agrees to
execute such further instruments and documents, if any, as the Administrative
Agent may reasonably request in connection therewith.

 

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Section 12.29. Acknowledgement and Consent to Bail-In of EEA Financial
Institutions. Notwithstanding anything to the contrary in any Loan Document or
in any other agreement, arrangement or understanding among any such parties,
each party hereto (including any party becoming a party hereto by virtue of an
Assignment and Acceptance) acknowledges that any liability of any EEA Financial
Institution arising under any Loan Document, to the extent such liability is
unsecured, may be subject to the write-down and conversion powers of an EEA
Resolution Authority and agrees and consents to, and acknowledges and agrees to
be bound by:

 

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution
Authority to any such liabilities arising hereunder which may be payable to it
by any party hereto that is an EEA Financial Institution; and

 

(b) the effects of any Bail-in Action on any such liability, including, if
applicable:

 

(i) a reduction in full or in part or cancellation of any such liability;

 

(ii) a conversion of all, or a portion of, such liability into shares or other
instruments of ownership in such EEA Financial Institution, its parent
undertaking, or a bridge institution that may be issued to it or otherwise
conferred on it, and that such shares or other instruments of ownership will be
accepted by it in lieu of any rights with respect to any such liability under
this Agreement or any other Loan Document; or

 

(iii) the variation of the terms of such liability in connection with the
exercise of the write-down and conversion powers of any EEA Resolution
Authority.

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Section 13. The Guarantees.

 

Section 13.1. The Guarantees. To induce the Lenders and L/C Issuer to provide
the credits described herein and in consideration of benefits expected to accrue
to the Borrower by reason of the Commitments and for other good and valuable
consideration, receipt of which is hereby acknowledged, the Guarantors party
hereto (including any Guarantor formed or acquired after the Closing Date
executing an Additional Guarantor Supplement in the form attached hereto as
Exhibit F or such other form acceptable to the Administrative Agent) hereby
unconditionally and irrevocably guarantee jointly and severally to the
Administrative Agent, the L/C Issuer, the Lenders, and their Affiliates, the due
and punctual payment of all present and future Obligations, Hedging Liability
and Bank Product Obligations, including, but not limited to, the due and
punctual payment of principal of and interest on the Loans, the Reimbursement
Obligations, Hedging Liability and Bank Product Obligations, and the due and
punctual payment of all other obligations now or hereafter owed by the Borrower
under the Loan Documents and the due and punctual payment of all Hedging
Liability and Bank Product Obligations, in each case as and when the same shall
become due and payable, whether at stated maturity, by acceleration, or
otherwise, according to the terms hereof and thereof (including all interest,
costs, fees, and charges after the entry of an order for relief against the
Borrower or such other obligor in a case under the United States Bankruptcy
Code, the Canadian Bankruptcy Legislation or any similar proceeding, whether or
not such interest, costs, fees and charges would be an allowed claim against the
Borrower or any such obligor in any such proceeding); provided, however, that
with respect to any Guarantor, its Guarantee of Hedging Liability of the
Borrower or any Guarantor shall exclude all Excluded Swap Obligations. In case
of failure by the Borrower or other obligor punctually to pay any obligations
guaranteed hereby, each Guarantor hereby unconditionally agrees to make such
payment or to cause such payment to be made punctually as and when the same
shall become due and payable, whether at stated maturity, by acceleration, or
otherwise, and as if such payment were made by the Borrower or such obligor.

 

Section 13.2. Guarantee Unconditional. The obligations of each Guarantor under
this Section 13 shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged, or otherwise
affected by:

 

(a) any extension, renewal, settlement, compromise, waiver, or release in
respect of any obligation of the Borrower or other obligor or of any other
guarantor under this Agreement or any other Loan Document or by operation of law
or otherwise;

 

(b) any modification or amendment of or supplement to this Agreement or any
other Loan Document or any agreement relating to Hedging Liability or Bank
Product Obligations;

 

(c) any change in the corporate existence, structure, or ownership of, or any
insolvency, bankruptcy, reorganization, or other similar proceeding affecting,
the Borrower or other obligor, any other guarantor, or any of their respective
assets, or any resulting release or discharge of any obligation of the Borrower
or other obligor or of any other guarantor contained in any Loan Document;

 

(d) the existence of any claim, set-off, or other rights which the Borrower or
other obligor or any other guarantor may have at any time against the
Administrative Agent, any Lender, or any other Person, whether or not arising in
connection herewith;

 

(e) any failure to assert, or any assertion of, any claim or demand or any
exercise of, or failure to exercise, any rights or remedies against the Borrower
or other obligor, any other guarantor, or any other Person or Property;

 

(f) any application of any sums by whomsoever paid or howsoever realized to any
obligation of the Borrower or other obligor, regardless of what obligations of
the Borrower or other obligor remain unpaid;

 

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(g) any invalidity or unenforceability relating to or against the Borrower or
other obligor or any other guarantor for any reason of this Agreement or of any
other Loan Document or any agreement relating to Hedging Liability or Bank
Product Obligations, or any provision of applicable Legal Requirements
purporting to prohibit the payment by the Borrower or other obligor or any other
guarantor of the principal of or interest on any Loan or any Reimbursement
Obligation or any other amount payable under the Loan Documents or any agreement
relating to Hedging Liability or Bank Product Obligations; or

 

(h) any other act or omission to act or delay of any kind by the Administrative
Agent, any Lender, or any other Person or any other circumstance whatsoever that
might, but for the provisions of this paragraph, constitute a legal or equitable
discharge of the obligations of any Guarantor under this Section 13.

 

Section 13.3. Discharge Only upon Payment in Full; Reinstatement in Certain
Circumstances. Each Guarantor’s obligations under this Section 13 shall remain
in full force and effect until the Commitments are terminated, all Letters of
Credit have expired, and the principal of and interest on the Loans and all
other amounts payable by the Borrower and the Guarantors under this Agreement
and all other Loan Documents and, if then outstanding and unpaid, all Hedging
Liability and Bank Product Obligations have been paid in full. If at any time
any payment of the principal of or interest on any Loan or any Reimbursement
Obligation or any other amount payable by the Borrower or other obligor or any
Guarantor under the Loan Documents or any agreement relating to Hedging
Liability or Bank Product Obligations is rescinded or must be otherwise restored
or returned upon the insolvency, bankruptcy, or reorganization of the Borrower
or other obligor or of any guarantor, or otherwise, each Guarantor’s obligations
under this Section 13 with respect to such payment shall be reinstated at such
time as though such payment had become due but had not been made at such time.

 

Section 13.4. Subrogation. Each Guarantor agrees it will not exercise any rights
which it may acquire by way of subrogation by any payment made hereunder, or
otherwise, until all the obligations guaranteed hereby shall have been paid in
full subsequent to the termination of all the Commitments and expiration of all
Letters of Credit. If any amount shall be paid to a Guarantor on account of such
subrogation rights at any time prior to the later of (x) the payment in full of
the Obligations, Bank Product Obligations and Hedging Liability and all other
amounts payable by the Borrower hereunder and under the other Loan Documents and
(y) the termination of the Commitments and expiration of all Letters of Credit,
such amount shall be held in trust for the benefit of the Administrative Agent
and the Lenders (and their Affiliates) and shall forthwith be paid to the
Administrative Agent for the benefit of the Lenders (and their Affiliates) or be
credited and applied upon the Obligations, Bank Product Obligations and Hedging
Liability, whether matured or unmatured, in accordance with the terms of this
Agreement.

 

Section 13.5. Waivers. Each Guarantor irrevocably waives acceptance hereof,
presentment, demand, protest, and any notice except as specifically provided for
herein, as well as any requirement that at any time any action be taken by the
Administrative Agent, any Lender, or any other Person against the Borrower or
other obligor, another guarantor, or any other Person.

 

-95-

 

 

Section 13.6. Limit on Recovery. Notwithstanding any other provision hereof, the
right of recovery against each Guarantor under this Section 13 shall not exceed
$1.00 less than the lowest amount which would render such Guarantor’s
obligations under this Section 13 void or voidable under applicable Legal
Requirements, including, without limitation, fraudulent conveyance law.

 

Section 13.7. Stay of Acceleration. If acceleration of the time for payment of
any amount payable by the Borrower or other obligor under this Agreement or any
other Loan Document or any agreement relating to Hedging Liability or Bank
Product Obligations, is stayed upon the insolvency, bankruptcy or reorganization
of the Borrower or such obligor, all such amounts otherwise subject to
acceleration under the terms of this Agreement or the other Loan Documents or
any agreement relating to Hedging Liability or Bank Product Obligations, shall
nonetheless be payable by the Guarantors hereunder forthwith on demand by the
Administrative Agent made at the request of the Required Lenders.

 

Section 13.8. Benefit to Guarantors. The Borrower and the Guarantors are engaged
in related businesses and integrated to such an extent that the financial
strength and flexibility of the Borrower has a direct impact on the success of
each Guarantor. Each Guarantor will derive substantial direct and indirect
benefit from the extensions of credit hereunder.

 

Section 13.9. Guarantor Covenants. Each Guarantor shall take such action as the
Borrower is required by this Agreement to cause such Guarantor to take, and
shall refrain from taking such action as the Borrower is required by this
Agreement to prohibit such Guarantor from taking.

 

Section 13.10. Keepwell. Each Qualified ECP Guarantor hereby jointly and
severally absolutely, unconditionally and irrevocably undertakes to provide such
funds or other support as may be needed from time to time by the Borrower and
each other Guarantor to honor all of its obligations under this Guaranty in
respect of Swap Obligations (provided, however, that each Qualified ECP
Guarantor shall only be liable under this Section for the maximum amount of such
liability that can be hereby incurred without rendering its obligations under
this Section, or otherwise under this Guaranty, as it relates to such Borrower
or other Guarantor, voidable under applicable Legal Requirements relating to
fraudulent conveyance or fraudulent transfer, and not for any greater amount).
The obligations of each Qualified ECP Guarantor under this Section shall remain
in full force and effect until discharged in accordance with Section 13.3. Each
Qualified ECP Guarantor intends that this Section constitute, and this Section
shall be deemed to constitute, a “keepwell, support, or other agreement” for the
benefit of the Borrower and each other Guarantor for all purposes of Section
1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

Section 13.11. Subordination. Each Guarantor (each referred to herein as a
“Subordinated Creditor”) hereby subordinates the payment of all indebtedness,
obligations, and liabilities of the Borrower or any other Guarantor owing to
such Subordinated Creditor, whether now existing or hereafter arising, to the
indefeasible payment in full in cash of all Obligations, Hedging Liability, and
Bank Product Obligations. During the continuance of any Event of Default or
Default under Sections 9.1 (a), (j) or (k), subject to Section 13.4, any such
indebtedness, obligation, or liability of the Borrower or any other Guarantor
owing to such Subordinated Creditor shall be enforced and performance received
by such Subordinated Creditor as trustee for the benefit of the holders of the
Obligations, Hedging Liability, and Bank Product Obligations and, upon the
acceleration of the Indebtedness under Section 9.2 or 9.3 hereof, the proceeds
thereof shall be paid over to the Administrative Agent for application to the
Obligations, Hedging Liability, and Bank Product Obligations (whether or not
then due), but without reducing or affecting in any manner the liability of such
Guarantor under this Section 13.

 

[Signature Pages to Follow]

 

-96-

 

 

This Amended and Restated Credit Agreement is entered into between us for the
uses and purposes hereinabove set forth as of the date first above written.

 

  “Borrower”         UMH Properties, Inc.         By     Name: Anna T. Chew  
Title: Vice President         “Administrative Agent and L/C Issuer”         Bank
of Montreal, as L/C Issuer and as Administrative Agent         By     Name    
Title  

 

[Signature Page to Amended and Restated Credit Agreement (UMH Properties, Inc.)]

 

 

 

 

  “Lenders”         Bank of Montreal, as a Lender         By              Name
             Title           

 

[Signature Page to Amended and Restated Credit Agreement (UMH Properties, Inc.)]

 

 

 

 

  “Guarantors”         UMH IN Countryside Estates, LLC         By              
Name               Title                     Mobile Home Village, Inc.        
By              Name               Title                     United Mobile Homes
of Ohio, Inc.         By     Name     Title           United Mobile Homes of
Pennsylvania, Inc.         By     Name     Title           UMH PA City View, LLC
        By     Name     Title           UMH TN Countryside Village, LLC        
By     Name     Title  

 

[Signature Page to Amended and Restated Credit Agreement (UMH Properties, Inc.)]

 

 

 

 

Exhibit A

 

Notice of Payment Request

 

[Date]

 

[Name of Lender]

[Address]

 

Attention:

 

Reference is made to the Amended and Restated Credit Agreement, dated as of
March 28, 2017, among UMH Properties, Inc., as Borrower, the Guarantors from
time to time party thereto, the Lenders from time to time party thereto, and
Bank of Montreal, as Administrative Agent (as amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”). Capitalized terms
used herein and not defined herein have the meanings assigned to them in the
Credit Agreement. [The Borrower has failed to pay its Reimbursement Obligation
in the amount of $____________. Your Percentage of the unpaid Reimbursement
Obligation is $_____________] or [__________________________ has been required
to return a payment by the Borrower of a Reimbursement Obligation in the amount
of $_______________. Your Percentage of the returned Reimbursement Obligation is
$_______________.]

 

  Very truly yours,         Bank of Montreal, as L/C Issuer         By         
Name     Title  

 

 

 

 

Exhibit B

 

Notice of Borrowing

 

Date:                  , ____

 

To: Bank of Montreal, as Administrative Agent for the Lenders from time to time
parties to the Amended and Restated Credit Agreement, dated as of March 28, 2017
(as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), among UMH Properties, Inc., as Borrower, the Guarantors
from time to time party thereto, the Lenders from time to time party thereto,
and Bank of Montreal, as Administrative Agent

 

Ladies and Gentlemen:

 

The undersigned, UMH Properties, Inc. (the “Borrower”), refers to the Credit
Agreement, the terms defined therein being used herein as therein defined, and
hereby gives you notice irrevocably, pursuant to Section 1.6 of the Credit
Agreement, of the Borrowing specified below:

 

1. The Business Day of the proposed Borrowing is ___________, ____.

 

2. The aggregate amount of the proposed Borrowing is $______________.

 

3. The Borrowing is being advanced under the Revolving Credit.

 

4. The Borrowing is to be comprised of $___________ of [Base Rate] [Eurodollar]
Loans.

 

[5. The duration of the Interest Period for the Eurodollar Loans included in the
Borrowing shall be ____________ months.]

 

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the proposed Borrowing, before and
after giving effect thereto and to the application of the proceeds therefrom:

 

(a) the representations and warranties of the Borrower contained in Section 6 of
the Credit Agreement are true and correct in all material respects (where not
already qualified by materiality, otherwise in all respects) as though made on
and as of such date (except to the extent the same expressly relate to an
earlier date, in which case they shall be true and correct in all material
respects (where not already qualified by materiality, otherwise in all respects)
as of such earlier date); and

 

(b) no Default or Event of Default has occurred and is continuing or would
result from such proposed Borrowing.

 

  UMH Properties, Inc.         By:                Name:     Title:  

 

 

 

 

Exhibit C

 

Notice of Continuation/Conversion

 

Date: ____________, ____

 

To: Bank of Montreal, as Administrative Agent for the Lenders from time to time
parties to the Amended and Restated Credit Agreement dated as of March 28, 2017
(as amended, restated, supplemented or otherwise modified from time to time, the
“Credit Agreement”), among UMH Properties, Inc., as Borrower, the Guarantors
from time to time party thereto, the Lenders from time to time party thereto,
and Bank of Montreal, as Administrative Agent

 

Ladies and Gentlemen:

 

The undersigned, UMH Properties, Inc. (the “Borrower”), refers to the Credit
Agreement, the terms defined therein being used herein as therein defined, and
hereby gives you notice irrevocably, pursuant to Section 1.6 of the Credit
Agreement, of the [conversion] [continuation] of the Loans specified herein,
that:

 

1. The conversion/continuation Date is __________, ____.

 

2. The aggregate amount of the Loans to be [converted] [continued] is
$______________.

 

3. The Loans are to be [converted into] [continued as] [Eurodollar] [Base Rate]
Loans.

 

4. [If applicable:] The duration of the Interest Period for the Loans included
in the [conversion] [continuation] shall be _________ months.

 

The undersigned hereby certifies that the following statements are true on the
date hereof, and will be true on the proposed conversion/continuation date,
before and after giving effect thereto and to the application of the proceeds
therefrom:

 

(a) the representations and warranties of the Borrower contained in Section 6 of
the Credit Agreement are true and correct in all material respects (where not
already qualified by materiality, otherwise in all respects) as though made on
and as of such date (except to the extent the same expressly relate to an
earlier date, in which case they shall be true and correct in all material
respects (where not already qualified by materiality, otherwise in all respects)
as of such earlier date); and

 

(b) no Default or Event of Default has occurred and is continuing, or would
result from such proposed [conversion] [continuation].

 

  UMH Properties, Inc.         By:              Name:     Title:  

 

-1-

 

 

Exhibit D

 

Revolving Note

 

U.S. $_______________ ________ __, 20__

 

For Value Received, the undersigned, UMH Properties, Inc., a Maryland
corporation (the “Borrower”), hereby promises to pay to ____________________
(the “Lender”) or its permitted assigns on the Termination Date of the
hereinafter defined Credit Agreement, at the principal office of the
Administrative Agent in Chicago Illinois (or such other location as the
Administrative Agent may designate to the Borrower), in immediately available
funds, the principal sum of ___________________ Dollars ($__________) or, if
less, the aggregate unpaid principal amount of all Loans made by the Lender to
the Borrower pursuant to the Credit Agreement, together with interest on the
principal amount of each Loan from time to time outstanding hereunder at the
rates, and payable in the manner and on the dates, specified in the Credit
Agreement.

 

This Revolving Note (this “Note”) is one of the Notes referred to in the Amended
and Restated Credit Agreement dated as of March 28, 2017, among the Borrower,
the Guarantors party thereto, the Lenders parties thereto, the L/C Issuer and
Bank of Montreal, as Administrative Agent (as amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”), and this Note and
the holder hereof are entitled to all the benefits provided for thereby or
referred to therein, to which Credit Agreement reference is hereby made for a
statement thereof. All defined terms used in this Note, except terms otherwise
defined herein, shall have the same meaning as in the Credit Agreement. This
Note shall be governed by and construed in accordance with the internal laws of
the State of Illinois.

 

Voluntary prepayments may be made hereon, certain prepayments are required to be
made hereon, and this Note may be declared due prior to the expressed maturity
hereof, all in the events, on the terms and in the manner as provided for in the
Credit Agreement.

 

The Borrower hereby waives demand, presentment, protest or notice of any kind
hereunder.

 

  UMH Properties, Inc.         By:             Name:     Title:  

 

 

 

 

Exhibit E

 

Compliance Certificate

 

To: Bank of Montreal, as Administrative Agent under, and the Lenders party to,
the Credit Agreement described below

 

This Compliance Certificate is furnished to the Administrative Agent and the
Lenders pursuant to that certain Amended and Restated Credit Agreement dated as
of March 28, 2017, among UMH Properties, Inc., as Borrower, the Guarantors party
thereto, the Administrative Agent and the Lenders party thereto (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”). Unless otherwise defined herein, the terms used in this Compliance
Certificate have the meanings ascribed thereto in the Credit Agreement.

 

The Undersigned hereby certifies that:

 

1. I am the duly elected ____________ of UMH Properties, Inc.;

 

2. I have reviewed the terms of the Credit Agreement and I have made, or have
caused to be made under my supervision, a detailed review of the transactions
and conditions of the Borrower and its Subsidiaries during the accounting period
covered by the attached financial statements;

 

3. The examinations described in paragraph 2 did not disclose, and I have no
knowledge of, the existence of any condition or the occurrence of any event
which constitutes a Default or Event of Default during or at the end of the
accounting period covered by the attached financial statements or as of the date
of this Compliance Certificate, except as set forth below;

 

4. The financial statements required by Section 8.5 of the Credit Agreement and
being furnished to you concurrently with this Compliance Certificate are true,
correct and complete as of the date and for the periods covered thereby; and

 

5. The Schedule I hereto sets forth financial data and computations evidencing
the Borrower’s compliance with certain covenants of the Credit Agreement, all of
which data and computations are, to the best of my knowledge, true, complete and
correct and have been made in accordance with the relevant Sections of the
Credit Agreement.

 

Described below are the exceptions, if any, to paragraph 3 by listing, in
detail, the nature of the condition or event, the period during which it has
existed and the action which the Borrower has taken, is taking, or proposes to
take with respect to each such condition or event:

 

                       

 

The foregoing certifications, together with the computations set forth in
Schedule I hereto and the financial statements delivered with this Certificate
in support hereof, are made and delivered this ______ day of __________________,
20__.

 

  UMH Properties, Inc.         By:           Name:     Title:  

 

-1-

 

 

Schedule I

to Compliance Certificate

 

 

 

Compliance Calculations

for Amended and Restated Credit Agreement
dated as of March 28, 2017

 

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 Line A2 ____:1.0   4.
Line A3 must not exceed 0.60:1.0   5. The Borrower is in compliance (circle yes
or no) yes/no

 

B. Minimum EBITDA to Fixed Charges Ratio (Section 8.20(b))

 

  1. Net income (or loss) $___________   2. Depreciation and amortization
expense ___________   3. Interest Expense ___________   4. Income tax expense
___________   5. Extraordinary, unrealized or non-recurring losses ___________  
6. Reasonable transaction costs and expenses incurred in connection with
acquisitions ___________   7. Sum of Lines B2, B3, B4, B5 and B6 ___________  
8. Rent reserved for capital expenditures ___________   9. Extraordinary or
unrealized gains ___________   10. Income tax benefits ___________   11. Sum of
Lines B8, B9 and B10 ___________   12. Line B1 plus Line B7 minus Line B11
(“EBITDA”) ___________   13. Interest Expense ___________   14. Scheduled
principal amortization ___________

 

-2-

 

 

  15. Line B13 plus Line B14 (“Debt Service”) ___________   16. Required
distributions ___________   17. Ground Lease payments ___________   18. Sum of
Lines B15, B16 and B17 (“Fixed Charges”) ___________   19. Ratio of Line B12 to
Line B18 ____:1.0   20. Line B19 shall not be less than 1.50:1.0   21. The
Borrower is in compliance (circle yes or no) yes/no

 

C. [Intentionally Omitted.]

 

D. Maximum Other Recourse Debt to Total Asset Value Ratio (Section 8.20(d))

 

  1. Other Recourse Debt  $___________   2. Total Asset Value as calculated on
Exhibit A hereto  ___________   3. Ratio of Line D1 to Line D2 ____:1.0   4.
Line D3 shall not exceed 0.20:1.0   5. The Borrower is in compliance (circle yes
or no)  yes/no

 

E. Tangible Net Worth (Section 8.20(e))

 

  1. Tangible Net Worth $___________   2. Aggregate net proceeds of Stock and
Stock Equivalent offerings since the Closing Date ___________   3. 85% of Line
E2 ___________   4. Closing Date Tangible Net Worth ($253,000,000) plus Line E3
___________   5. Line E1 shall not be less than Line E4     6. The Borrower is
in compliance (circle yes or no) yes/no

 

F. Maximum Floating Rate Debt (Section 8.20(f))

 

  1. Floating Rate Debt $___________   2. Total Asset Value ___________   3.
Line F1 divided by Line F2 ___________   4. Line F3 shall not exceed 25% of
Total Asset Value     5. The Borrower is in compliance (circle yes or no) yes/no

 

-3-

 

 

G. Investments (Joint Ventures) (Section 8.8(j))

 

  1. Cash Investments in Joint Ventures $___________   2. Total Asset Value
___________   3. Line G1 divided by Line G2 ___________   4. Line G3 shall not
exceed 10% of Total Asset Value     5. The Borrower is in compliance (circle yes
or no) yes/no

 

H. Investments (Assets Under Development) (Section 8.8(k))

 

  1. Investments in Assets Under Development $___________   2. Total Asset Value
___________   3. Line H1 divided by Line H2 ___________   4. Line H3 shall not
exceed 10% of Total Asset Value     5. The Borrower is in compliance (circle yes
or no) yes/no

 

I. Investments (Unimproved Land) (Section 8.8(l))

 

  1. Investments in unimproved land holdings $___________   2. Total Asset Value
___________   3. Line I1 divided by Line I2 ___________   4. Line I3 shall not
exceed 10% of Total Asset Value     5. The Borrower is in compliance (circle yes
or no) yes/no

 

J. Investments (Ground Leases) (Section 8.8(m))

 

  1. Investments in Ground Leases $___________   2. Total Asset Value
___________   3. Line J1 divided by Line J2 ___________   4. Line J3 shall not
exceed 10% of Total Asset Value     5. The Borrower is in compliance (circle yes
or no) yes/no

 

K. Investments (Other) (Section 8.8(r))

 

  1. Other Investments $___________   2. Total Asset Value ___________   3. Line
K1 divided by Line K2 ___________   4. Line K3 shall not exceed 5% of Total
Asset Value     5. The Borrower is in compliance (circle yes or no) yes/no

 

L. Aggregate Investment Limitation to Total Asset Value (Section 8.8)

 

  1. Sum of Lines G1, H1, I1, J1 and K1 $___________   2. Total Asset Value
____________   3. Line L1 divided by Line L2 ___________   4. Line L3 shall not
exceed 20% of Total Asset Value     5. The Borrower is in compliance (circle yes
or no) yes/no

 

-4-

 

 

Exhibit A to Schedule I

to Compliance Certificate

of UMH Properties, Inc.

 

This Exhibit A is attached to Schedule I to the Compliance Certificate of UMH
Properties, Inc. dated [________], 20__ and delivered to Bank of Montreal, 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 Total Asset Value as of the last day of the Fiscal
Quarter most recently ended:

 

[Insert Calculation]

 

  UMH Properties, Inc.         By:         Name:     Title:  

 

-5-

 

 

Exhibit B to Schedule I

to Compliance Certificate

of UMH Properties, Inc.

 

This Exhibit B is attached to Schedule I to the Compliance Certificate of UMH
Properties, Inc. dated [_______], 20__ and delivered to Bank of Montreal, 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 Adjusted Property NOI for all Properties for the
Rolling Period most recently ended:

 

Property Property
Income Minus Property Expenses Minus Annual Capital Expenditure Reserve equals
Adjusted Property NOI   $________ - $______________ -   = $___________  
$________ - $______________ -   = $___________   $________ - $______________ -  
= $___________   $_______ - $______________ -   = $___________

 

Total Adjusted Property NOI for all Properties: $_____________

 

  UMH Properties, Inc.         By:           Name:     Title:  

 

-6-

 

 

Exhibit F

Assignment and Acceptance

 

Dated _____________, _______

 

Reference is made to the Amended and Restated Credit Agreement dated as of March
28, 2017 (as amended, restated, supplemented or otherwise modified from time to
time, the “Credit Agreement”) among UMH Properties, Inc., the Guarantors from
time to time party thereto, the Lenders and L/C Issuer parties thereto, and Bank
of Montreal, as Administrative Agent (the “Administrative Agent”). Terms defined
in the Credit Agreement are used herein with the same meaning.

 

______________________________________________________ (the “Assignor”) and
_________________________ (the “Assignee”) agree as follows:

 

1. The Assignor hereby sells and assigns to the Assignee, and the Assignee
hereby purchases and assumes from the Assignor, the amount and specified
percentage interest shown on Annex I hereto of the Assignor’s rights and
obligations under the Credit Agreement as of the Effective Date (as defined
below), including, without limitation, the Assignor’s Commitments as in effect
on the Effective Date and the Loans, if any, owing to the Assignor on the
Effective Date and the Assignor’s Percentage of any outstanding L/C Obligations.

 

2. The Assignor (i) represents and warrants that it is the legal and beneficial
owner of the interest being assigned by it hereunder and that such interest is
free and clear of any adverse claim, lien, or encumbrance of any kind; (ii)
makes no representation or warranty and assumes no responsibility with respect
to any statements, warranties or representations made in or in connection with
the Credit Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement or any other
instrument or document furnished pursuant thereto; and (iii) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or any Subsidiary or the performance or
observance by the Borrower or any Subsidiary of any of their respective
obligations under the Credit Agreement or any other instrument or document
furnished pursuant thereto.

 

3. The Assignee (i) confirms that it has received a copy of the Credit
Agreement, together with copies of the most recent financial statements
delivered to the Lenders pursuant to Section 8.5(b) and (c) thereof and such
other documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into this Assignment and Acceptance; (ii)
agrees that it will, independently and without reliance upon the Administrative
Agent, the Assignor or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Credit Agreement;
(iii) appoints and authorizes the Administrative Agent to take such action as
Administrative Agent on its behalf and to exercise such powers under the Credit
Agreement and the other Loan Documents as are delegated to the Administrative
Agent by the terms thereof, together with such powers as are reasonably
incidental thereto; (iv) agrees that it will perform in accordance with their
terms all of the obligations which by the terms of the Credit Agreement are
required to be performed by it as a Lender; and (v) specifies as its lending
office (and address for notices) the offices set forth on its Administrative
Questionnaire.

 

 

 

 

4. As consideration for the assignment and sale contemplated in Annex I hereof,
the Assignee shall pay to the Assignor on the Effective Date in Federal funds
the amount agreed upon between them. It is understood that commitment and/or
letter of credit fees accrued to the Effective Date with respect to the interest
assigned hereby are for the account of the Assignor and such fees accruing from
and including the Effective Date are for the account of the Assignee. Each of
the Assignor and the Assignee hereby agrees that if it receives any amount under
the Credit Agreement which is for the account of the other party hereto, it
shall receive the same for the account of such other party to the extent of such
other party’s interest therein and shall promptly pay the same to such other
party.

 

5. The effective date for this Assignment and Acceptance shall be ___________
(the “Effective Date”). Following the execution of this Assignment and
Acceptance, it will be delivered to the Administrative Agent for acceptance and
recording by the Administrative Agent and, if required, the Borrower.

 

6. Upon such acceptance and recording, as of the Effective Date, (i) the
Assignee shall be a party to the Credit Agreement and, to the extent provided in
this Assignment and Acceptance, have the rights and obligations of a Lender
thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Credit Agreement.

 

7. Upon such acceptance and recording, from and after the Effective Date, the
Administrative Agent shall make all payments under the Credit Agreement in
respect of the interest assigned hereby (including, without limitation, all
payments of principal, interest and commitment fees with respect thereto) to the
Assignee. The Assignor and Assignee shall make all appropriate adjustments in
payments under the Credit Agreement for periods prior to the Effective Date
directly between themselves.

 

-2-

 

 

8. This Assignment and Acceptance shall be governed by, and construed in
accordance with, the internal laws of the State of Illinois.

 

  [Assignor Lender]         By            Name     Title           [Assignee
Lender]         By          Name     Title  

 

Accepted and consented this

 

____ day of _____________

 

UMH Properties, Inc.         By               Name     Title    

 

Accepted and consented to by the Administrative Agent and L/C Issuer this ___
day of _________

 

Bank of Montreal, as Administrative Agent and L/C Issuer

 

By     Name     Title    

 

-3-

 

 

Annex I

 

to Assignment and Acceptance

 

The assignee hereby purchases and assumes from the assignor the following
interest in and to all of the Assignor’s rights and obligations under the Credit
Agreement as of the effective date.

 

Facility Assigned   Aggregate
Commitment/Loans
for All Lenders   Amount of
Commitment/Loans
Assigned   Percentage Assigned
of Commitment/Loans               Revolving Credit   $             _____________
  $                       __________   _____%

 

-4-

 

 

Exhibit G

 

Additional Guarantor Supplement

 

______________, ___

 

Bank of Montreal, as Administrative Agent for the Lenders named in the Amended
and Restated Credit Agreement dated as of March 28, 2017, among UMH Properties,
Inc., as Borrower, the Guarantors from time to time party thereto, the Lenders
from time to time party thereto, and the Administrative Agent (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”)

 

Ladies and Gentlemen:

 

Reference is made to the Credit Agreement described above. Terms not defined
herein which are defined in the Credit Agreement shall have for the purposes
hereof the meaning provided therein.

 

The undersigned, [name of Subsidiary Guarantor], a [jurisdiction of
incorporation or organization] hereby elects to be a “Guarantor” for all
purposes of the Credit Agreement, effective from the date hereof. The
undersigned confirms that each of the representations and warranties set forth
in Section 6 of the Credit Agreement in respect of a Guarantor are true and
correct as to the undersigned as of the date hereof and the undersigned shall
comply with and perform each of the covenants and obligations set forth in, and
to be bound in all respects by the terms of, the Credit Agreement that are
applicable to a Guarantor, including, without limitation, the provisions of
Sections 8 and 13 of the Credit Agreement that are applicable to a Guarantor, in
each case, to the same extent and with the same force and effect as if the
undersigned were a signatory party thereto.

 

The undersigned acknowledges that this Agreement shall be effective upon its
execution and delivery by the undersigned to the Administrative Agent, and it
shall not be necessary for the Administrative Agent or any Lender, or any of
their Affiliates entitled to the benefits hereof, to execute this Agreement or
any other acceptance hereof. This Agreement shall be construed in accordance
with and governed by the internal laws of the State of Illinois.

 

  Very truly yours,         [Name of Subsidiary Guarantor]         By          
  Name     Title  

 

 

 

 

Exhibit H

Commitment Amount Increase Request

 

_______________, ____

 

To: Bank of Montreal, as Administrative Agent for the Lenders parties to the
Amended and Restated Credit Agreement dated as of March 28, 2017 (as amended,
restated, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among UMH Properties, Inc., as Borrower, the Guarantors from time
to time party thereto, certain Lenders party thereto, and Bank of Montreal, as
Administrative Agent

 

Ladies and Gentlemen:

 

The undersigned, UMH Properties, Inc. (the “Borrower”) hereby refers to the
Credit Agreement and requests that the Administrative Agent consent to an
increase in the aggregate Commitments (the “Commitment Amount Increase”), in
accordance with Section 1.15 of the Credit Agreement, to be effected by [an
increase in the Commitment of [name of existing Lender] [the addition of [name
of new Lender] (the “New Lender”) as a Lender under the terms of the Credit
Agreement]. Capitalized terms used herein without definition shall have the same
meanings herein as such terms have in the Credit Agreement.

 

After giving effect to such Commitment Amount Increase, the Commitment of the
[Lender] [New Lender] shall be $_____________.

 

[Include paragraphs 1-4 for a New Lender]

 

1. The New Lender hereby confirms that it has received a copy of the Loan
Documents and the exhibits related thereto, together with copies of the
documents which were required to be delivered under the Credit Agreement as a
condition to the making of the Loans and other extensions of credit thereunder.
The New Lender acknowledges and agrees that it has made and will continue to
make, independently and without reliance upon the Administrative Agent or any
other Lender and based on such documents and information as it has deemed
appropriate, its own credit analysis and decisions relating to the Credit
Agreement. The New Lender further acknowledges and agrees that the
Administrative Agent has not made any representations or warranties about the
credit worthiness of the Borrower or any other party to the Credit Agreement or
any other Loan Document or with respect to the legality, validity, sufficiency
or enforceability of the Credit Agreement or any other Loan Document or the
value of any security therefor.

 

2. Except as otherwise provided in the Credit Agreement, effective as of the
date of acceptance hereof by the Administrative Agent, the New Lender (i) shall
be deemed automatically to have become a party to the Credit Agreement and have
all the rights and obligations of a “Lender” under the Credit Agreement as if it
were an original signatory thereto and (ii) agrees to be bound by the terms and
conditions set forth in the Credit Agreement as if it were an original signatory
thereto.

 

3. The New Lender shall deliver to the Administrative Agent an Administrative
Questionnaire.

 

[4. The New Lender has delivered, if appropriate, to the Borrower and the
Administrative Agent (or is delivering to the Borrower and the Administrative
Agent concurrently herewith) the tax forms referred to in [Section 12.1] of the
Credit Agreement.]*

 

This Agreement shall be deemed to be a contractual obligation under, and shall
be governed by and construed in accordance with, the internal laws of the state
of Illinois.

 

The Commitment Amount Increase shall be effective when the executed consent of
the Administrative Agent is received or otherwise in accordance with Section
1.15 of the Credit Agreement, but not in any case prior to ___________________,
____. It shall be a condition to the effectiveness of the Commitment Amount
Increase that all expenses referred to in Section 1.15 of the Credit Agreement
shall have been paid.

 

The Borrower hereby certifies that no Default or Event of Default has occurred
and is continuing.

 

 

* Insert bracketed paragraph if New Lender is organized under the law of a
jurisdiction other than the United States of America or a state thereof.

 

-2-

 

 

Please indicate the Administrative Agent’s consent to such Commitment Amount
Increase by signing the enclosed copy of this letter in the space provided
below.

 

  Very truly yours,         UMH Properties, Inc.         By:             Name:  
  Title:           [New or existing Lender Increasing Commitments]         By:  
  Name:     Title:  

 

The undersigned hereby consents on this __ day of _____________, _____ to the
above-requested Commitment Amount Increase.

 

Bank of Montreal,   as Administrative Agent         By                Name  
Title  

 

-3-

 

 

Exhibit I

 

Borrowing Base Certificate

 

To:Bank of Montreal, as Administrative Agent under, and the Lenders party to,
the Credit Agreement described below.

 

Pursuant to the terms of the Amended and Restated Credit Agreement dated as of
March 28, 2017, among UMH Properties, Inc., as Borrower, the Guarantors from
time to time party thereto, the Lenders from time to time party thereto and Bank
of Montreal, as Administrative Agent (as amended, restated, supplemented or
otherwise modified from time to time, 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. 60% of the Borrowing Base Value as calculated on Exhibit A hereto
$_________________ 2. Debt Service Coverage Amount of all Borrowing Base
Properties as calculated on Exhibit B hereto $_________________ 3. Lesser of
Line 1 and Line 2
(the “Borrowing Base”) $_________________ 4. Commitments as then in effect
$_________________ 5. Lesser of Line 3 and Line 4 $_________________ 6.
Aggregate principal amount of outstanding Loans and L/C Obligations
$_________________ 7. Line 5 minus Line 6 (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__.

 

  UMH Properties, Inc.         By:          Name:     Title:  

 

-4-

 

 

Exhibit A to Borrowing Base Certificate

 

of UMH Properties, Inc.

 

This Exhibit A is attached to the Borrowing Base Certificate of UMH Properties,
Inc. for the Borrower Base Determination Date of ___________ ____, 20__ and
delivered to Bank of Montreal, 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:

 

[Insert Calculation or attach Schedule with exclusions for concentration limits]

 

Borrowing Base Value of all Borrowing Base Properties: $__________

 

Borrowing Base Requirements:

 

A. Borrowing Base Value

 

1. Borrowing Base Value $___________ 2. Line A1 shall not be less than
$35,000,000   3. The Borrower is in compliance (circle yes or no) yes/no

 

B.Individual Eligible Property Value

 

1. The Percentage of Borrowing Base Value of each Eligible Property is set forth
[above or on the attached Schedule] and the largest Borrowing Base Value or any
Eligible Property is $___________ for the ___________ Eligible Property.   2. No
Eligible Property comprises more than 15% of the Borrowing Base Value  

 

C. Average Occupancy Rate

 

1. The Occupancy Rate of each Borrowing Base Property is set forth [above or on
the attached Schedule] and the weighted average (based on Borrowing Base Value)
Occupancy Rate of all Borrowing Base Properties is ____%. ___________% 2. Line
C1 shall not be less than 70%   3. The Borrower is in compliance (circle yes or
no) yes/no

 

-5-

 

 

Exhibit B to Borrowing Base Certificate

 

of UMH Properties, Inc.

 

This Exhibit B is attached to the Borrowing Base Certificate of UMH Properties,
Inc. for the Borrower Base Determination Date of ___________ ____, 20__ and
delivered to Bank of Montreal, 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 as of the Borrowing Base Determination Date set forth above:

 

 

Eligible Properties  Aggregate Debt Service Coverage Amount as Calculated on
Annex I to this Certificate See Annex 1  $__________

 

-6-

 

 

Annex I to Borrowing Base Certificate

 

of UMH Properties, Inc.

 

[Borrower to attach.]

 

-7-

 

 

Schedule I

Commitments

 

Lender  Commitment  Bank of Montreal  $50,000,000  JPMorgan Chase Bank, N.A. 
$25,000,000  Total:  $75,000,000 

 

-8-

 

 

Schedule 1.1

Borrowing Base Properties
as of First Amendment Effective Date

Property and Location   Property Owner Countryside Estate, Muncie, IN   UMH IN
Countryside Estates, LLC Woodlawn Village, Eatontown, NJ   Mobile Home Village,
Inc. River Valley Estates, Marion, OH   United Mobile Homes of Ohio, Inc. Sandy
Valley Estate, Magnolia, OH   United Mobile Homes of Ohio, Inc. Spreading Oak
Village, Athens, OH   United Mobile Homes of Ohio, Inc. Wood Valley, Caledonia,
OH   United Mobile Homes of Ohio, Inc. Laurel Woods, Cresson, PA   United Mobile
Homes of Pennsylvania, Inc. Pine Valley Estates, Apollo, PA   United Mobile
Homes of Pennsylvania, Inc. Cross Keys Village, Duncansville, PA   UMH
Properties, Inc. Pine Ridge Village/Pine Manor, Carlisle, PA   UMH Properties,
Inc. Port Royal Village, Belle Vernon, PA   UMH Properties, Inc. Countryside
Village, Columbia, TN   UMH TN Countryside Village, LLC City View, Lewistown, PA
  UMH PA City View, LLC The Meadows, Nappanee, IN   UMH IN Meadows, LLC Heather
Highlands, Jenkins Township, PA   United Mobile Homes of Pennsylvania, Inc.

 

 

 

 

Schedule 6.2

 

Subsidiaries

 

[See Organizational Charts On Following Pages]