Document:

Exhibit 10.2

 

EXECUTION VERSION

 

FIRST AMENDMENT TO

AMENDED AND RESTATED TERM LOAN AGREEMENT

AND OTHER LOAN DOCUMENTS

 

This First Amendment to Amended and Restated Term Loan Agreement and other Loan Documents (this “Amendment”) is made as of this 19th day of April, 2018, among CORESITE, L.P., a Delaware limited partnership (“Borrower”), ROYAL BANK OF CANADA, as Administrative Agent (the “Agent”) for the certain lenders party to the Loan Agreement (as defined below) (each a “Lender” and collectively, the “Lenders”), the Lenders and the Guarantors (as defined below).  Unless otherwise defined herein, terms defined in the Loan Agreement set forth below shall have the same meaning herein.

 

W I T N E S S E T H:

 

WHEREAS, Borrower, the Agent and the Lenders have entered into a certain Amended and Restated Term Loan Agreement dated as of April 19, 2017 (the “Loan Agreement”);

 

WHEREAS, CoreSite Realty Corporation, a Maryland corporation, and certain other parties (collectively, the “Guarantors”) have executed and delivered a certain Second Amended and Restated Guaranty in favor of the Agent and the Lenders dated as of April 19, 2017 (the “Guaranty”); and

 

WHEREAS, Borrower, the Agent, the Lenders and the Guarantors have agreed to amend the Loan Agreement and the other Loan Documents (including the Guaranty) as set forth herein.

 

NOW, THEREFORE, the Loan Agreement and the Guaranty are hereby amended as follows:

 

1.             Amendments.

 

(a)                     The Loan Agreement is hereby amended to delete the stricken text (indicated textually in the same manner as the following example: stricken text) and to add the underlined text (indicated textually in the same manner as the following example: underlined text) as set forth in the pages of the Loan Agreement attached as Annex A (as so amended, the “Amended Loan Agreement”).

 

(b)                     The Guaranty is hereby amended to delete the stricken text (indicated textually in the same manner as the following example: stricken text) and to add the underlined text (indicated textually in the same manner as the following example: underlined text) as set forth in the pages of the Guaranty attached as Annex B (as so amended, the “Amended Guaranty”).

 

2.             Additional Guarantor.  CoreSite Real Estate 3032 Coronado, L.P., a Delaware limited partnership (the “Additional Subsidiary Guarantor”), hereby confirms, represents and warrants to the Agent and the Lenders that the Additional Subsidiary Guarantor is a Subsidiary of Borrower.  By executing and delivering this Amendment, the Additional Subsidiary Guarantor hereby becomes a party to the Guaranty as a Guarantor thereunder with the same force and effect as if originally named therein as a Guarantor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a Guarantor thereunder.  Effective as of the date of this Amendment, the Additional Subsidiary Guarantor confirms its acceptance of, and consents to, all representations and warranties, covenants, and other terms and provisions of the Guaranty.  The Additional Subsidiary Guarantor hereby represents and warrants that each of the representations and warranties contained in

 

1

 

Section 5 of the Guaranty is true and correct on and as the date hereof as if made on and as of such date, except to the extent any such representation or warranty (including any such representation or warranty contained in the Loan Agreement) was expressly made as of an earlier date, in which case such representation or warranty was true and correct as of such earlier date.

 

3.             Representations and Warranties.  Each of Borrower and the Guarantors hereby represents, warrants and covenants with the Agent and the Lenders that, as of the date hereof (i) all representations and warranties made in the Loan Agreement and other Loan Documents remain and continue to be true and correct in all material respects, except to the extent that such representations and warranties expressly refer to an earlier date, and (ii) to the knowledge of Borrower and each Guarantor, there exists no Default or Event of Default under any of the Loan Documents.

 

4.             Reference to and Effect on the Loan Agreement and the Loan Documents.

 

(a)                     This Amendment is a Loan Document.  On and after the effectiveness of this Amendment, each reference in the Loan Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Loan Agreement, and each reference in the other Loan Documents to “the Loan Agreement”, “thereunder”, “thereof” or words of like import referring to the Loan Agreement, shall mean and be a reference to the Loan Agreement, as amended and modified by this Amendment to read in the form of the Amended Loan Agreement.

 

(b)                     On and after the effectiveness of this Amendment, each reference in the Guaranty to “this Guaranty”, “hereunder”, “hereof” or words of like import referring to the Guaranty, and each reference in the other Loan Documents to “the Guaranty”, “thereunder”, “thereof” or words of like import referring to the Guaranty, shall mean and be a reference to the Guaranty, as amended and modified by this Amendment to read in the form of the Amended Guaranty.

 

5.             Miscellaneous.  This Amendment, which may be executed in multiple counterparts, constitutes the entire agreement of the parties regarding the matters contained herein and shall not be modified by any prior oral or written discussions.  Delivery of an executed counterpart of a signature page of this Amendment by telecopy or other electronic imaging transmission (e.g. PDF by email) shall be effective as delivery of a manually executed counterpart of this Amendment.  Each of Borrower and each Guarantor hereby ratifies, confirms and reaffirms all of the terms and conditions of the Loan Agreement, and each of the other Loan Documents to which it is a party, and further acknowledges and agrees that all of the terms and conditions of the Loan Agreement and other Loan Documents to which it is a party shall remain in full force and effect, except as expressly provided in this Amendment.  Any determination that any provision of this Amendment or any application hereof is invalid, illegal or unenforceable in any respect and in any instance shall not affect the validity, legality or enforceability of such provision in any other instance, or the validity, legality or enforceability of any other provisions of this Amendment.

 

6.             Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York.

 

[SIGNATURES ON FOLLOWING PAGE]

 

2

 

It is intended that this Amendment take effect as an instrument under seal as of the date first written above.

 

	
 
    	
BORROWER:
    
	
 
    	
 
    
	
 
    	
CORESITE, L.P.,   a Delaware limited partnership, by its general partner, CoreSite Realty   Corporation, a Maryland corporation
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Jeffrey S. Finnin
    
	
 
    	
 
    	
Name:
    	
Jeffrey S. Finnin
    
	
 
    	
 
    	
Title:
    	
Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(SEAL)
    

 

[SIGNATURES CONTINUE ON FOLLOWING PAGE]

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
GUARANTORS
    
	
 
    	
 
    
	
 
    	
CORESITE REALTY CORPORATION, a
    
	
 
    	
Maryland Corporation
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Jeffrey   S. Finnin
    
	
 
    	
 
    	
Name:
    	
Jeffrey S. Finnin
    
	
 
    	
 
    	
Title:
    	
Chief Financial Officer
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 70   INNERBELT, L.L.C., a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 900 N.   ALAMEDA, L.P., a Delaware limited partnership
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
CORESITE REAL ESTATE 900 N.   Alameda GP, L.L.C., a Delaware limited liability company,   its general partner
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 2901   CORONADO, L.P., a Delaware limited partnership
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
CORESITE REAL ESTATE 2901   CORONADO GP, L.L.C., a Delaware limited liability company,   its general partner
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 1656   MCCARTHY, L.P., a Delaware limited partnership
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
CORESITE REAL ESTATE 1656   MCCARTHY GP, L.L.C., a Delaware limited liability company,   its general partner
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 427 S.   LASALLE, L.L.C., a Delaware limited liability company
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 2972   STENDER, L.P., a Delaware limited partnership,
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By
    	
CORESITE REAL ESTATE 2972   STENDER GP, L.L.C., a Delaware limited liability company,   its general partner
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 12100   SUNRISE VALLEY DRIVE L.L.C., a Delaware limited liability   company
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 2115 NW 22ND STREET, L.L.C., a Delaware limited   liability company
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
CORESITE ONE WILSHIRE, L.L.C.,   a Delaware limited liability company
    
					

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
CORESITE REAL ESTATE 55 S.   MARKET STREET, L.L.C., a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 3032   CORONADO, L.P., a Delaware limited partnership
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Jeffrey   S. Finnin
    
	
 
    	
 
    	
Name:
    	
Jeffrey S. Finnin
    
	
 
    	
 
    	
Title:
    	
Chief Financial Officer
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
Address for Notices:
    
	
 
    	
 
    
	
 
    	
CoreSite, L.P.
    
	
 
    	
1001 17th Street, Suite 500
    
	
 
    	
Denver, CO 80202
    
	
 
    	
Attn: General Counsel
    
	
 
    	
Telecopy No.: (855)   232-0594
    
	
 
    	
 
    
	
 
    	
With a copy to:
    
	
 
    	
 
    
	
 
    	
Latham &   Watkins LLP
    
	
 
    	
885 Third Avenue
    
	
 
    	
New York, NY 10022
    
	
 
    	
Attn: Dara Denberg,   Esquire
    
	
 
    	
Telecopy No.: (212)   751-4864
    
	
 
    	
 
    
	
 
    	
With a copy to:
    
	
 
    	
 
    
	
 
    	
Latham &   Watkins LLP
    
	
 
    	
555 Eleventh   Street, NW, Suite 1000
    
	
 
    	
Washington, DC   20004-1304
    
	
 
    	
Attn: Jeffrey R. Chenard,   Esquire
    
	
 
    	
Telecopy No.: (202)   637-2201
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
AGENT AND LENDERS:
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
ROYAL BANK OF CANADA, as Agent
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Susan Khokher
    
	
 
    	
 
    	
Name:
    	
Susan   Khokher
    
	
 
    	
 
    	
Title:
    	
Manager,   Agency
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
Royal Bank   of Canada
    
	
 
    	
20 King   Street West, 4th Floor
    
	
 
    	
Toronto,   Ontario M5H 1C4
    
	
 
    	
Attention:   Manager, Agency Services
    
	
 
    	
Facsimile:   416-842-4023
    
						

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
ROYAL BANK OF CANADA, as a Lender
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Brian   Gross
    
	
 
    	
 
    	
Name:
    	
Brian Gross
    
	
 
    	
 
    	
Title:
    	
Authorized   Signatory
    
	
 
    	
 
    	
 
    	
 
    
	
Royal Bank   of Canada
    	
 
    
	
Brookfield   Place
    	
 
    
	
200 Vesey Street
    	
 
    
	
New York,   NY 10281-8098
    	
 
    
	
Attn:    Manager, Loans Administration
    	
 
    
	
Telephone:    877-332-7455
    	
 
    
	
Facsimile:    212-428-2372
    	
 
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
REGIONS BANK, as a Lender
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Lee   Surtees
    
	
 
    	
 
    	
Name:
    	
Lee Surtees
    
	
 
    	
 
    	
Title:
    	
Senior Vice   President
    
	
 
    	
 
    	
 
    	
 
    
	
Regions   Bank
    	
 
    	
 
    	
 
    
	
6805   Morrison Boulevard, Suite 100
    	
 
    	
 
    	
 
    
	
Charlotte,   NC 28211
    	
 
    	
 
    	
 
    
	
Attention:   Kerri Raines
    	
 
    	
 
    	
 
    
	
Telephone:   704-362-3564
    	
 
    	
 
    	
 
    
	
Facsimile:   704-362-3594
    	
 
    	
 
    	
 
    
					

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
THE TORONTO-DOMINION BANK, NEW YORK BRANCH, as a Lender
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Wallace   Wong
    
	
 
    	
 
    	
Name:
    	
Wallace   Wong
    
	
 
    	
 
    	
Title:
    	
Authorized   Signatory
    
	
 
    	
 
    	
 
    	
 
    
	
The   Toronto-Dominion Bank, New York Branch
    	
 
    	
 
    	
 
    
	
c/o TD   Securities
    	
 
    	
 
    	
 
    
	
222 Bay   Street, E&Y Tower 15th Floor
    	
 
    	
 
    	
 
    
	
Toronto,   Ontario M5K 1A2
    	
 
    	
 
    	
 
    
	
Attention:   Maria Macchiaroli
    	
 
    	
 
    	
 
    
	
Telephone:   416-308-3619
    	
 
    	
 
    	
 
    
	
Facsimile:   416-982-8619
    	
 
    	
 
    	
 
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
WELLS FARGO BANK, NATIONAL   ASSOCIATION, as a Lender
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Ricky Nahal
    
	
 
    	
 
    	
Name:
    	
Ricky Nahal
    
	
 
    	
 
    	
Title:
    	
Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
Wells Fargo Bank,   National Association
    	
 
    
	
1800 Century Park East, 12th Floor
    	
 
    
	
Los Angeles, California 90067
    	
 
    
	
Attention: Ricky S. Nahal
    	
 
    
	
Telephone: (310) 789-3768
    	
 
    
	
Facsimile: (310) 789-3733
    	
 
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
COBANK, ACB, as a Lender
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Jacqueline Bove
    
	
 
    	
 
    	
Name:
    	
Jacqueline   Bove
    
	
 
    	
 
    	
Title:
    	
Managing   Director
    
	
 
    	
 
    	
 
    	
 
    
	
CoBank, ACB
    	
 
    	
 
    	
 
    
	
6340 S. Fiddlers Green Circle
    	
 
    	
 
    	
 
    
	
Greenwood Village, CO 80111
    	
 
    	
 
    	
 
    
	
Attention:
    	
Jacqueline   Bove
    	
 
    	
 
    	
 
    
	
Telephone:
    	
303-740-4037
    	
 
    	
 
    	
 
    
	
Facsimile:
    	
303-224-2654
    	
 
    	
 
    	
 
    
						

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
CITIBANK, N.A., as a Lender
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ John C.   Rowland
    
	
 
    	
 
    	
Name:
    	
John C.   Rowland
    
	
 
    	
 
    	
Title:
    	
Vice   President
    
	
 
    	
 
    	
 
    	
 
    
	
Citibank,   N.A.
    	
 
    	
 
    	
 
    
	
388   Greenwich Street, 6th Floor
    	
 
    	
 
    	
 
    
	
New York,   New York 10013
    	
 
    	
 
    	
 
    
	
Attention:
    	
John C.   Rowland
    	
 
    	
 
    	
 
    
	
Telephone:
    	
212-816-4947
    	
 
    	
 
    	
 
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
SUNTRUST BANK, as a Lender
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
Francine   Glandt
    
	
 
    	
 
    	
Name:
    	
Francine   Glandt
    
	
 
    	
 
    	
Title:
    	
Senior Vice   President
    
	
 
    	
 
    	
 
    	
 
    
	
SunTrust Bank
    	
 
    	
 
    	
 
    
	
33 Peachtree St. NE, 22nd Floor
    	
 
    	
 
    	
 
    
	
Atlanta, GA 30308
    	
 
    	
 
    	
 
    
	
Attention:
    	
Alexander   H. Rownd
    	
 
    	
 
    	
 
    
	
Telephone:
    	
404-813-0510
    	
 
    	
 
    	
 
    
	
Facsimile:
    	
404-813-2000
    	
 
    	
 
    	
 
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
BANK OF AMERICA, N.A.,   as a Lender
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Dennis Kwan
    
	
 
    	
 
    	
Name:
    	
Dennis Kwan
    
	
 
    	
 
    	
Title:
    	
Vice President
    
	
 
    	
 
    
	
Bank of America, N.A.
    	
 
    
	
555 California Street, 6th Floor
    	
 
    
	
San Francisco, CA 04104
    	
 
    
	
Attention: Dennis Kwan
    	
 
    
	
Telephone: 415-913-4697
    	
 
    
	
Facsimile: 415-503-5055
    	
 
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

	
 
    	
PNC BANK, NATIONAL ASSOCIATION,   as a Lender
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Brandon K. Fiddler
    
	
 
    	
 
    	
Name:
    	
Brandon K. Fiddler
    
	
 
    	
 
    	
Title:
    	
Senior Vice President
    
	
 
    	
 
    
	
PNC Bank, National   Association
    	
 
    
	
1075 Peachtree St. NE, Suite 1800
    	
 
    
	
Atlanta, GA 30309
    	
 
    
	
Attention: Brandon Fiddler
    	
 
    
	
Telephone: 404-495-6367
    	
 
    
	
Facsimile: 404-495-6099
    	
 
    

 

Signature Page to First Amendment to Amended and Restated Term Loan Agreement and Other Loan Documents

 

 

ANNEX A

 

[Attached.]

 

EXECUTION VERSIONCONFORMED COPY REFLECTING

FIRST AMENDMENT DATED AS OF APRIL 19, 2018

 

AMENDED AND RESTATED TERM LOAN AGREEMENT

 

DATED AS OF APRIL 19, 2017

 

As amended by FIRST AMENDMENT TO 
 AMENDED AND RESTATED TERM LOAN AGREEMENT AND OTHER LOAN DOCUMENTS

 

dated as of April 19, 2018

 

by and among

 

CORESITE, L.P., AS BORROWER,

 

ROYAL BANK OF CANADA,

 

THE OTHER LENDERS WHICH ARE PARTIES TO THIS AGREEMENT,

 

OTHER LENDERS THAT MAY BECOME

 

PARTIES TO THIS AGREEMENT,

 

AND

 

ROYAL BANK OF CANADA, AS ADMINISTRATIVE AGENT,

 

WITH

 

REGIONS BANK, AS SYNDICATION AGENT

 

RBC CAPITAL MARKETS,(1) REGIONS CAPITAL MARKETS,

TD SECURITIES (USA) LLC AND WELLS FARGO SECURITIES, LLC,
 AS JOINT LEAD ARRANGERS AND JOINT BOOK MANAGERS

 

(1)  RBC Capital Markets is the global brand name for the corporate and investment banking business of Royal Bank of Canada and its affiliates.

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
SECTION 1   DEFINITIONS AND RULES OF INTERPRETATION
    	
1
    
	
 
    	
 
    	
 
    	
 
    
	
§ 1.1
    	
Definitions
    	
1
    
	
§ 1.2
    	
Rules of   Interpretation
    	
22
    
	
SECTION 2 MAKING OF   THE LOAN
    	
2326
    
	
 
    	
 
    	
 
    	
 
    
	
§ 2.1
    	
The Loan
    	
2326
    
	
§ 2.2
    	
[Intentionally Omitted]
    	
2326
    
	
§ 2.3
    	
[Intentionally Omitted]
    	
2326
    
	
§ 2.4
    	
[Intentionally Omitted]
    	
2326
    
	
§ 2.5
    	
[Intentionally Omitted]
    	
2326
    
	
§ 2.6
    	
[Intentionally Omitted]
    	
26
    
	
§ 2.62.7
    	
Interest
    	
2326
    
	
§ 2.72.8
    	
Requests for Advance
    	
2427
    
	
§ 2.82.9
    	
Funds for Advances
    	
2427
    
	
§ 2.92.10
    	
Use of Proceeds
    	
2528
    
	
§ 2.102.11
    	
Reallocation of Lender   Commitment Percentages; No Novation
    	
2528
    
	
§ 2.112.12
    	
Increase in Total   Commitment
    	
2629
    
	
SECTION 3 REPAYMENT   OF THE ADVANCES
    	
2730
    
	
 
    	
 
    	
 
    	
 
    
	
§ 3.1
    	
Stated Maturity
    	
2730
    
	
§ 3.2
    	
Mandatory Prepayments
    	
2730
    
	
§ 3.3
    	
Optional Prepayments
    	
2830
    
	
§ 3.4
    	
Partial Prepayments
    	
2831
    
	
§ 3.5
    	
Effect of Prepayments
    	
2831
    
	
SECTION 4 CERTAIN   GENERAL PROVISIONS
    	
2831
    
	
 
    	
 
    	
 
    	
 
    
	
§ 4.1
    	
Conversion Options
    	
2831
    
	
§ 4.2
    	
Fees
    	
2932
    
	
§ 4.3
    	
[Intentionally Omitted]
    	
2932
    
	
§ 4.4
    	
Funds for Payments
    	
2932
    
	
§ 4.5
    	
Computations
    	
3136
    
	
§ 4.6
    	
Suspension of LIBOR   Rate Advances
    	
3136
    
	
§ 4.7
    	
Illegality
    	
3236
    
	
§ 4.8
    	
Additional Interest
    	
3237
    
	
§ 4.9
    	
Additional Costs, Etc.
    	
3237
    
	
§ 4.10
    	
Capital Adequacy
    	
3338
    
	
§ 4.11
    	
Breakage Costs
    	
3438
    
	
§ 4.12
    	
Default Interest; Late Charge
    	
3438
    
	
§ 4.13
    	
Certificate
    	
3438
    
	
§ 4.14
    	
Limitation on Interest
    	
3439
    
	
§ 4.15
    	
Certain Provisions   Relating to Increased Costs and Defaulting Lenders
    	
3439
    
	
SECTION 5   UNENCUMBERED ASSET POOL
    	
3540
    
	
 
    	
 
    	
 
    	
 
    
	
§ 5.1
    	
Addition of Eligible   Real Estate Assets
    	
3540
    
	
§ 5.2
    	
Release of Eligible   Real Estate Assets
    	
3641
    
	
§ 5.3
    	
Additional Subsidiary   Guarantors
    	
3641
    
	
§ 5.4
    	
Release of Certain   Subsidiary Guarantors
    	
3741
    
	
SECTION 6   REPRESENTATIONS AND WARRANTIES
    	
3742
    
					

 

ii

 

	
§ 6.1
    	
Corporate Authority,   Etc.
    	
3742
    
	
§ 6.2
    	
Governmental Approvals
    	
3843
    
	
§ 6.3
    	
Title to Eligible   Real Estate Assets
    	
3843
    
	
§ 6.4
    	
Financial Statements
    	
3843
    
	
§ 6.5
    	
No Material Changes
    	
3943
    
	
§ 6.6
    	
Franchises, Patents,   Copyrights, Etc.
    	
3944
    
	
§ 6.7
    	
Litigation
    	
3944
    
	
§ 6.8
    	
No Material Adverse Contracts,   Etc.
    	
3944
    
	
§ 6.9
    	
Compliance with Other   Instruments, Laws, Etc.
    	
3944
    
	
§ 6.10
    	
Tax Status
    	
4044
    
	
§ 6.11
    	
No Event of Default
    	
4044
    
	
§ 6.12
    	
Investment Company Act
    	
40; EEA   Financial Institution
    	
45
    
	
§ 6.13
    	
Absence of UCC   Financing Statements, Etc.
    	
4045
    
	
§ 6.14
    	
Setoff, Etc.
    	
4045
    
	
§ 6.15
    	
Certain Transactions
    	
4045
    
	
§ 6.16
    	
Employee Benefit Plans
    	
4045
    
	
§ 6.17
    	
Disclosure
    	
4145
    
	
§ 6.18
    	
Trade Name; Place of   Business
    	
4146
    
	
§ 6.19
    	
Regulations T, U and X
    	
4146
    
	
§ 6.20
    	
Environmental   Compliance
    	
4146
    
	
§ 6.21
    	
Subsidiaries;   Organizational Structure
    	
4247
    
	
§ 6.22
    	
Leases
    	
4347
    
	
§ 6.23
    	
Property
    	
4348
    
	
§ 6.24
    	
Brokers
    	
4449
    
	
§ 6.25
    	
Other Debt
    	
4449
    
	
§ 6.26
    	
Solvency
    	
4449
    
	
§ 6.27
    	
No Bankruptcy Filing
    	
4449
    
	
§ 6.28
    	
No Fraudulent Intent
    	
4449
    
	
§ 6.29
    	
Transaction in Best Interests   of Loan Parties; Consideration
    	
4549
    
	
§ 6.30
    	
OFAC
    	
 
    	
4550
    
	
SECTION 7   AFFIRMATIVE COVENANTS
    	
4550
    
	
 
    	
 
    	
 
    	
 
    
	
§ 7.1
    	
Punctual Payment
    	
4550
    
	
§ 7.2
    	
Maintenance of Office
    	
4550
    
	
§ 7.3
    	
Records and Accounts
    	
4550
    
	
§ 7.4
    	
Financial Statements,   Certificates and Information
    	
4550
    
	
§ 7.5
    	
Notices
    	
4753
    
	
§ 7.6
    	
Existence; Maintenance   of Properties
    	
4954
    
	
§ 7.7
    	
Insurance
    	
4954
    
	
§ 7.8
    	
Taxes
    	
4954
    
	
§ 7.9
    	
Inspection of   Properties and Books
    	
4955
    
	
§ 7.10
    	
Compliance with Laws,   Contracts, Licenses, and Permits
    	
5055
    
	
§ 7.11
    	
Further Assurances
    	
5055
    
	
§ 7.12
    	
Management
    	
5055
    
	
§ 7.13
    	
Intentionally Omitted
    	
5055
    
	
§ 7.14
    	
Business Operations
    	
5055
    
	
§ 7.15
    	
Registered Servicemark
    	
5056
    
	
§ 7.16
    	
Ownership of Real   Estate
    	
5056
    
	
§ 7.17
    	
Intentionally Omitted
    	
5056
    
	
§ 7.18
    	
Ownership RestrictionsRestriction
    	
5156
    
	
§ 7.19
    	
Plan Assets
    	
5156
    
	
§ 7.20
    	
Intentionally Omitted
    	
5156
    
	
§ 7.21
    	
Intentionally Omitted
    	
5156
    

 

iii

 

	
§ 7.22
    	
REIT Covenants
    	
5156
    
	
SECTION 8 NEGATIVE   COVENANTS
    	
5157
    
	
 
    	
 
    	
 
    	
 
    
	
§ 8.1
    	
Restrictions on   Indebtedness
    	
5157
    
	
§ 8.2
    	
Restrictions on Liens,   Etc.
    	
5258
    
	
§ 8.3
    	
Restrictions on   Investments
    	
5459
    
	
§ 8.4
    	
Merger, Consolidation
    	
5560
    
	
§ 8.5
    	
Sale and Leaseback
    	
5560
    
	
§ 8.6
    	
Compliance with   Environmental Laws
    	
5561
    
	
§ 8.7
    	
Distributions
    	
5661
    
	
§ 8.8
    	
Asset Sales
    	
5762
    
	
§ 8.9
    	
Intentionally Omitted
    	
5762
    
	
§ 8.10
    	
Restriction on   Prepayment of Indebtedness
    	
5762
    
	
§ 8.11
    	
Zoning and Contract   Changes and Compliance
    	
5762
    
	
§ 8.12
    	
Derivatives Contracts
    	
5762
    
	
§ 8.13
    	
Transactions with   Affiliates
    	
5762
    
	
§ 8.14
    	
Management Fees
    	
5762
    
	
§ 8.15
    	
§8.15 Sanctions; Anti-Corruption Laws
    	
62
    
	
SECTION 9 FINANCIAL   COVENANTS
    	
5863
    
	
 
    	
 
    	
 
    	
 
    
	
§ 9.1
    	
Unencumbered Asset Pool
    	
5863
    
	
§ 9.2
    	
Consolidated Total   Indebtedness to Gross Asset Value
    	
5863
    
	
§ 9.3
    	
Secured Debt to Gross   Asset Value
    	
5863
    
	
§ 9.4
    	
Secured Recourse   Indebtedness to Gross Asset Value
    	
5863
    
	
§ 9.5
    	
Adjusted Consolidated   EBITDA to Consolidated Fixed Charges
    	
5863
    
	
§ 9.6
    	
Minimum Consolidated   Tangible Net Worth
    	
5863
    
	
§ 9.7
    	
Unhedged   Variable Rate Debt
    	
58
    
	
§ 9.8
    	
Unencumbered   Asset Pool
    	
58
    
	
SECTION 10 CLOSING   CONDITIONS
    	
5963
    
	
 
    	
 
    	
 
    	
 
    
	
§ 10.1
    	
Loan Documents
    	
5963
    
	
§ 10.2
    	
Certified Copies of   Organizational Documents
    	
5964
    
	
§ 10.3
    	
Resolutions
    	
5964
    
	
§ 10.4
    	
Incumbency Certificate;   Authorized Signers
    	
5964
    
	
§ 10.5
    	
Opinion of Counsel
    	
5964
    
	
§ 10.6
    	
Payment of Fees
    	
5964
    
	
§ 10.7
    	
Insurance
    	
5964
    
	
§ 10.8
    	
Performance; No Default
    	
5964
    
	
§ 10.9
    	
Representations and   Warranties
    	
5964
    
	
§ 10.10
    	
Proceedings and   Documents
    	
6064
    
	
§ 10.11
    	
Eligible Real Estate   Qualification Documents
    	
6064
    
	
§ 10.12
    	
Compliance Certificate
    	
6065
    
	
§ 10.13
    	
[Reserved]
    	
6065
    
	
§ 10.14
    	
Consents
    	
6065
    
	
§ 10.15
    	
Other
    	
6065
    
	
SECTION 11   CONDITIONS TO ALL ADVANCES
    	
6065
    
	
 
    	
 
    	
 
    	
 
    
	
§ 11.1
    	
Prior Conditions   Satisfied
    	
6065
    
	
§ 11.2
    	
Representations True;   No Default
    	
6065
    
	
§ 11.3
    	
Borrowing Documents
    	
6065
    
	
SECTION 12 EVENTS   OF DEFAULT; ACCELERATION; ETC.
    	
6166
    
	
 
    	
 
    	
 
    	
 
    
	
§ 12.1
    	
Events of Default and   Acceleration
    	
6166
    

 

iv

 

	
§ 12.2
    	
Certain Cure Periods;   Limitation of Cure Periods
    	
6368
    
	
§ 12.3
    	
Termination of Commitments
    	
6368
    
	
§ 12.4
    	
Remedies
    	
6469
    
	
§ 12.5
    	
Distribution of   Collateral Proceeds
    	
6469
    
	
SECTION 13 SETOFF
    	
6570
    
	
 
    	
 
    
	
SECTION 14 THE   AGENT
    	
6570
    
	
 
    	
 
    	
 
    	
 
    
	
§ 14.1
    	
Authorization
    	
6570
    
	
§ 14.2
    	
Employees and Agents
    	
6671
    
	
§ 14.3
    	
No Liability
    	
6671
    
	
§ 14.4
    	
No Representations
    	
6671
    
	
§ 14.5
    	
Payments
    	
6671
    
	
§ 14.6
    	
Holders of Notes
    	
6772
    
	
§ 14.7
    	
Indemnity
    	
6772
    
	
§ 14.8
    	
The Agent as Lender
    	
6772
    
	
§ 14.9
    	
Resignation
    	
6772
    
	
§ 14.10
    	
Duties in the Case of   Enforcement
    	
6873
    
	
§ 14.11
    	
Bankruptcy
    	
6873
    
	
§ 14.12
    	
Intentionally Omitted
    	
6873
    
	
§ 14.13
    	
Reliance by Agent
    	
6873
    
	
§ 14.14
    	
Approvals
    	
6974
    
	
§ 14.15
    	
Loan Parties Not   Beneficiary
    	
6974
    
	
§ 14.16
    	
Defaulting Lenders
    	
6974
    
	
§ 14.17
    	
Defaulting Lender Cure
    	
75
    
	
§ 14.18
    	
Certain ERISA Matters
    	
76
    
	
SECTION 15 EXPENSES
    	
7077
    
	
 
    	
 
    
	
SECTION 16   INDEMNIFICATION
    	
7178
    
	
 
    	
 
    
	
SECTION 17 SURVIVAL   OF COVENANTS, ETC.
    	
7278
    
	
 
    	
 
    
	
SECTION 18   ASSIGNMENT AND PARTICIPATION
    	
7279
    
	
 
    	
 
    	
 
    	
 
    
	
§ 18.1
    	
Conditions to   Assignment by Lenders
    	
7279
    
	
§ 18.2
    	
Register
    	
7379
    
	
§ 18.3
    	
New Notes
    	
7380
    
	
§ 18.4
    	
Participations
    	
7380
    
	
§ 18.5
    	
Pledge by Lender
    	
7480
    
	
§ 18.6
    	
No Assignment by   Borrower
    	
7481
    
	
§ 18.7
    	
Disclosure
    	
7481
    
	
§ 18.8
    	
Titled Agents
    	
7582
    
	
§ 18.9
    	
Mandatory Assignment
    	
7582
    
	
SECTION 19 NOTICES
    	
7683
    
	
 
    	
 
    
	
SECTION 20   RELATIONSHIP
    	
7784
    
	
 
    	
 
    
	
SECTION 21   GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE
    	
7784
    
	
 
    	
 
    
	
SECTION 22 HEADINGS
    	
7885
    
	
 
    	
 
    
	
SECTION 23   COUNTERPARTS
    	
7885
    

 

v

 

	
SECTION 24 ENTIRE   AGREEMENT, ETC.
    	
7885
    
	
 
    	
 
    
	
SECTION 25 WAIVER   OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS
    	
7885
    
	
 
    	
 
    
	
SECTION 26 DEALINGS   WITH LOAN PARTIES
    	
7986
    
	
 
    	
 
    
	
SECTION 27   CONSENTS, AMENDMENTS, WAIVERS, ETC.
    	
7986
    
	
 
    	
 
    	
 
    
	
§ 27.1
    	
Amendments Generally
    	
86
    
	
§ 27.2
    	
Technical Amendments
    	
87
    
	
§ 27.3
    	
Revolver Provisions
    	
87
    
	
SECTION 28   SEVERABILITY
    	
8087
    
	
 
    	
 
    
	
SECTION 29 TIME OF   THE ESSENCE
    	
8188
    
	
 
    	
 
    
	
SECTION 30 NO   UNWRITTEN AGREEMENTS
    	
8188
    
	
 
    	
 
    
	
SECTION 31   REPLACEMENT NOTES
    	
8188
    
	
 
    	
 
    
	
SECTION 32 NO THIRD   PARTIES BENEFITED
    	
8188
    
	
 
    	
 
    
	
SECTION 33 PATRIOT   ACT
    	
8289
    
	
 
    	
 
    
	
SECTION 34   [INTENTIONALLY OMITTED.]
    	
8289
    
	
 
    	
 
    
	
SECTION 35   [INTENTIONALLY OMITTED]
    	
8289
    
	
 
    	
 
    
	
SECTION 36   [INTENTIONALLY OMITTED]
    	
8289
    
	
 
    	
 
    
	
SECTION 37   [INTENTIONALLY OMITTED]
    	
8289
    
	
 
    	
 
    
	
SECTION 38   ACKNOWLEDGMENT AND CONSENT TO BAIL-IN OF EEA FINANCIAL INSTITUTIONS
    	
8289
    

 

vi

 

EXHIBITS AND SCHEDULES

 

	
Exhibit A
    	
FORM OF NOTE
    
	
 
    	
 
    
	
Exhibit B
    	
FORM OF JOINDER   AGREEMENT
    
	
 
    	
 
    
	
Exhibit C
    	
FORM OF REQUEST   FOR ADVANCE
    
	
 
    	
 
    
	
Exhibit D
    	
FORM OF   UNENCUMBERED ASSET POOL CERTIFICATE
    
	
 
    	
 
    
	
Exhibit E
    	
FORM OF COMPLIANCE   CERTIFICATE
    
	
 
    	
 
    
	
Exhibit F
    	
FORM OF ASSIGNMENT   AND ACCEPTANCE AGREEMENT
    
	
 
    	
 
    
	
Exhibit G
    	
FORM OF   CONVERSION/CONTINUATION REQUEST
    
	
 
    	
 
    
	
Exhibit J
    	
FORM OF TAX COMPLIANCE CERTIFICATES
    
	
 
    	
 
    
	
Schedule 1.1
    	
LENDERS AND COMMITMENTS
    
	
 
    	
 
    
	
Schedule 1.2
    	
ELIGIBLE REAL ESTATE   QUALIFICATION DOCUMENTS
    
	
 
    	
 
    
	
Schedule 1.3
    	
CLOSING DATE ELIGIBLE   REAL ESTATE ASSETS
    
	
 
    	
 
    
	
Schedule 6.3
    	
LIST OF ALL   ENCUMBRANCES ON ASSETS
    
	
 
    	
 
    
	
Schedule 6.5
    	
NO MATERIAL CHANGES
    
	
 
    	
 
    
	
Schedule 6.7
    	
PENDING LITIGATION
    
	
 
    	
 
    
	
Schedule 6.15
    	
CERTAIN TRANSACTIONS
    
	
 
    	
 
    
	
Schedule 6.20(d)
    	
REQUIRED ENVIRONMENTAL   ACTIONS
    
	
 
    	
 
    
	
Schedule 6.21(a)
    	
BORROWER SUBSIDIARIES
    
	
 
    	
 
    
	
Schedule 6.21(b)
    	
UNCONSOLIDATED   AFFILIATES OF BORROWER AND ITS SUBSIDIARIES
    
	
 
    	
 
    
	
Schedule 6.22
    	
EXCEPTIONS TO RENT ROLL
    
	
 
    	
 
    
	
Schedule 6.23
    	
PROPERTY AND MANAGEMENT   AGREEMENTS
    
	
 
    	
 
    
	
Schedule 6.25
    	
MATERIAL LOAN   AGREEMENTS
    
	
 
    	
 
    
	
Schedule 8.8
    	
ASSET SALES
    

 

vii

 

AMENDED AND RESTATED TERM LOAN AGREEMENT

 

THIS AMENDED AND RESTATED TERM LOAN AGREEMENT is made as of the 19th day of April, 2017, by and among CORESITE, L.P., a Delaware limited partnership (“Borrower”), ROYAL BANK OF CANADA (“RBC”), the other lending institutions which are parties to this Agreement as “Lenders”, and the other lending institutions that may become parties hereto pursuant to § 18, and ROYAL BANK OF CANADA, as Administrative Agent for the Lenders (the “Agent”), with REGIONS BANK as Syndication Agent, and RBC CAPITAL MARKETS, REGIONS CAPITAL MARKETS, TD SECURITIES (USA) LLC and WELLS FARGO SECURITIES, LLC, as Joint Lead Arrangers and Joint Book Managers.

 

R E C I T A L S

 

WHEREAS, pursuant to that certain Term Loan Agreement dated as of January 31, 2014 by and among Borrower, certain subsidiaries of Borrower named therein, the Agent and the lenders party thereto, as amended by the First Amendment to Term Loan Agreement dated as of June 25, 2015 and as further amended by the Second Amendment to Term Loan Agreement dated as of June 15, 2016 (as so amended, the “Existing Loan Agreement”), the lenders party thereto agreed to make certain loans to Borrower; and

 

WHEREAS, Borrower, the Agent and the lenders party to the Existing Loan Agreement desire to amend and restate the Existing Loan Agreement to make certain amendments thereto; and

 

NOW, THEREFORE, in consideration of the recitals set forth above, which by this reference are incorporated into the operative provisions of this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and subject to the terms and conditions hereof and on the basis of the representations and warranties herein set forth, the parties hereby agree to amend and restate the Existing Loan Agreement to read in its entirety as herein set forth.

 

SECTION 1

 

DEFINITIONS AND RULES OF INTERPRETATION

 

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

 

“Additional Subsidiary Guarantor”:  Each additional Subsidiary of Borrower which becomes a Subsidiary Guarantor pursuant to § 5.3.

 

“Adjusted Consolidated EBITDA”:  On any date of determination, the sum of (a) the Consolidated EBITDA for the prior fiscal quarter most recently ended, multiplied by four (4), less (b) the Capital Reserve.

 

“Adjusted Net Operating Income”:  On any date of determination, the sum of (a) the Net Operating Income for the prior fiscal quarter most recently ended, multiplied by four (4), less (b) the Capital Reserve.

 

“Advances”:  Each advance of the Loan as provided herein.

 

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

 

8

 

interest, (ii) a managing member’s or manager’s interest in a limited liability company or (iii) a limited partnership interest or preferred stock (or other ownership interest) representing fifty percent (50%) or more of the outstanding limited partnership interests, preferred stock or other ownership interests of such Person.

 

“Agent”:  Royal Bank of Canada, acting as administrative agent for the Lenders, and its successors and assigns.

 

“Agent’s Head Office”:  The Agent’s head office located at 20 King Street West, 4th Floor, Toronto, Ontario M5H 1C4, or at such other location as the Agent may designate from time to time by notice to Borrower and the Lenders.

 

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

 

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

 

“Agreement Regarding Fees”:  Individually and collectively, any fee letter executed and delivered by Borrower to which any Arranger or the Agent is a party.

 

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

 

“Anti-Money Laundering Laws”:  All Legal Requirements related to the financing of terrorism or money laundering, including without limitation, any applicable provision of the Patriot Act and The Currency and Foreign Transactions Reporting Act (also known as the “Bank Secrecy Act,” 31 U.S.C. §§ 5311-5330 and 12U.S.C. §§ 1818(s), 1820(b) and 1951-1959).

 

“Applicable Margin”:  The(a) Prior to the Investment Grade Pricing Date, the Applicable Margin for LIBOR Rate Advances and Base Rate Advances shall be as set forth below based on the ratio of the Consolidated Total Indebtedness of Borrower to the Gross Asset Value of Borrower:

 

	
Pricing Level
    	
 
    	
Ratio
    	
 
    	
LIBOR Rate
   Advances
    	
 
    	
Base Rate

Advances
    	
 
    
	
Pricing Level 1
    	
 
    	
Less than or equal to 35%
    	
 
    	
1.501.40
    	
%
    	
0.500.40
    	
%
    
	
Pricing Level 2
    	
 
    	
Greater than 35% but less than or equal to 40%
    	
 
    	
1.601.50
    	
%
    	
0.600.50
    	
%
    
	
Pricing Level 3
    	
 
    	
Greater than 40% but less than or equal to 45%
    	
 
    	
1.751.65
    	
%
    	
0.750.65
    	
%
    
	
Pricing Level 4
    	
 
    	
Greater than 45% but less than or equal to 50%
    	
 
    	
1.901.80
    	
%
    	
0.900.80
    	
%
    
	
Pricing Level 5
    	
 
    	
Greater than 50%
    	
 
    	
2.102.00
    	
%
    	
1.101.00
    	
%
    

 

The Applicable Margin shall not be adjusted based upon such ratio, if at all, until the first (1st) day of the first (1st) month following the delivery by Borrower to the Agent of the Compliance Certificate at the end of a calendar quarter.  In the event that Borrower shall fail to deliver to the Agent a quarterly Compliance Certificate on or before the date required by § 7.4(c), then without limiting any other rights of the Agent and the Lenders under this Agreement, the Applicable Margin for the Advances shall be at Pricing Level 5 until such failure is cured within any applicable cure period, in which event the Applicable Margin shall adjust, if necessary, on the first (1st) day of the first (1st) month following receipt of such Compliance Certificate.  The provisions of this definition shall be subject to § 2.6(f).

 

(b)           If REIT or Borrower obtains an Investment Grade Rating, Borrower may, upon written notice to the Agent, make an irrevocable one time election  to exclusively use the below table based on the applicable rate per annum set forth therein:

 

9

 

	
Level
    	
 
    	
Credit Rating
    	
 
    	
LIBOR Rate
    Advances
    	
 
    	
Base Rate
    Advances
    	
 
    
	
I
    	
 
    	
> A- or A3
    	
 
    	
0.90
    	
%
    	
0.00
    	
%
    
	
II
    	
 
    	
> BBB+ or Baa1
    	
 
    	
0.95
    	
%
    	
0.00
    	
%
    
	
III
    	
 
    	
> BBB or Baa2
    	
 
    	
1.10
    	
%
    	
0.10
    	
%
    
	
IV
    	
 
    	
> BBB- or Baa3
    	
 
    	
1.35
    	
%
    	
0.35
    	
%
    
	
V
    	
 
    	
< BBB- and Baa3  or unrated
    	
 
    	
1.75
    	
%
    	
0.75
    	
%
    

 

Any change in REIT’s or Borrower’s Credit Rating which would cause it to move to a different Level in such table shall effect a change in the Applicable Margin on the Business Day on which such change occurs.  During any period for which Borrower or REIT has received a Credit Rating from only one Rating Agency, then the Applicable Margin shall be determined based on such Credit Rating.  During any period that Borrower or REIT has received more than one Credit Rating and such Credit Ratings are not equivalent, the Applicable Margin shall be determined by the highest of the Credit Ratings provided that the next highest Credit Rating is only one Level below that of the highest Credit Rating.  If the next highest Credit Rating is more than one Level below that of the highest Credit Rating, pricing will be determined utilizing the Credit Rating one Level higher than the next highest of the Credit Ratings.  During any period after the Investment Grade Pricing Date for which Parent Borrower or REIT does not have a Credit Rating from any Rating Agency, the Applicable Margin shall be determined based on Level V.

 

“Approved Derivatives Contract”:  A Derivatives Contract between the Borrower and/or any Subsidiary Guarantor, on the one hand, and a Lender or Affiliate of a Lender hereunder.

 

“Approved Fund”:  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.

 

“Arrangers”:  Collectively, RBC Capital Markets, Regions Capital Markets, TD Securities (USA) LLC and Wells Fargo Securities LLC or any successors thereto.

 

“Assignment and Acceptance Agreement”:  See § 18.1.

 

“Authorized Officer”:  Any of the following Persons:  Paul E. Szurek, Jeffrey S. Finnin, Derek S. McCandless and such other Persons as Borrower shall designate in a written notice to the Agent.

 

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

 

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

 

“Balance Sheet Date”:  December 31, 20162017.

 

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

 

10

 

“Base Rate”:  The greater of (a) the fluctuating annual rate of interest announced from time to time by the Agent at the Agent’s Head Office as its “prime rate”, (b) the then applicable LIBOR for a one month Interest Period plus one percent (1.00%), or (c) one half of one percent (0.5%) above the Federal Funds Effective Rate.  The Base Rate is a reference rate and does not necessarily represent the lowest or best rate being charged to any customer.  Any change in the rate of interest payable hereunder resulting from a change in the Base Rate shall become effective as of the opening of business on the day on which such change in the Base Rate becomes effective, without notice or demand of any kind.

 

“Base Rate Advances”:  Advances bearing interest calculated by reference to the Base Rate.

 

“Benefit Plan”:  Any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.

 

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

 

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

 

“Business Day”  Any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the laws of, or are in fact closed in, the State of New York, and if such day relates to any interest rate settings as to a LIBOR Rate Advance, which is also a LIBOR Business Day.

 

“Capital Reserve”:  For any period and with respect to any improved Real Estate, an amount equal to $0.25 multiplied by the total square footage of the Buildings in such Real Estate.  If the term Capital Reserve is used without reference to any specific Real Estate, then the amount shall be determined on an aggregate basis with respect to all Real Estate of Borrower and its Subsidiaries and a proportionate share of all Real Estate of all Unconsolidated Affiliates.  The Capital Reserve shall be calculated based on the total square footage of the Buildings owned (or ground leased) at the end of each fiscal quarter, less the square footage of unoccupied space held for development or redevelopment.

 

“Capitalization Rate”:  EightSeven and one halfthree fourths percent (8.507.75%).

 

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

 

“Capitalized Value”:  The Adjusted Net Operating Income for any Stabilized Property divided by the Capitalization Rate.

 

“Cash Equivalents”:  As of any date, (i) securities issued or directly and fully guaranteed or insured by the United States government or any agency or instrumentality thereof having maturities of not more than one year from such date, (ii) time deposits and certificates of deposits having maturities of not more than one year from such date and issued by any domestic commercial bank having, (A) senior long term unsecured debt rated at least A- or the equivalent thereof by S&P or A3 or the equivalent thereof by Moody’s and (B) capital and surplus in excess of $100,000,000; (iii) commercial paper rated at least A-2 or the equivalent thereof by S&P or P-2 or the equivalent thereof by Moody’s and in either case maturing within one hundred twenty (120) days

 

11

 

from such date, and (iv) shares of any money market mutual fund rated at least AA- or the equivalent thereof by S&P or at least Aa3 or the equivalent thereof by Moody’s.

 

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

 

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

 

“Change of Control”:  A Change of Control shall exist upon the occurrence of any of the following:

 

(a)           Any Person (including a Person’s Affiliates and associates) or group (as that term is understood under Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules and regulations thereunder), other than The Carlyle Group, shall have acquired beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of a percentage (based on voting power, in the event different classes of stock or voting interests shall have different voting powers) of the voting stock or voting interests of REIT or Borrower equal to at least fifty percent (50%);

 

(b)           As of any date a majority of the Board of Directors or Trustees or similar body (the “Board”) of REIT or Borrower consists of individuals who were not either (i) directors or trustees of REIT or Borrower as of the corresponding date of the previous year, or (ii) selected or nominated to become directors or trustees by the Board of REIT or Borrower of which a majority consisted of individuals described in clause (b)(i) above, or (iii) selected or nominated to become directors or trustees by the Board of REIT or Borrower, which majority consisted of individuals described in clause (b)(i) above and individuals described in clause (b)(ii), above; or

 

(c)           REIT shall fail to be the sole general partner of Borrower, shall fail to own such general partnership interest in Borrower free of any lien, encumbrance or other adverse claim, or shall fail to control the management and policies of Borrower; or

 

(d)           Borrower fails to own directly or indirectly, free of any lien, encumbrance or other adverse claim, at least one hundred percent (100%) of the economic, voting and beneficial interest of each Subsidiary GuarantorPool Owner.

 

“Closing Date”:  The first date on which all of the conditions set forth in § 10 and § 11 have been satisfied with respect to the Advances to be made pursuant to §2.1(a).

 

“Code”:  The Internal Revenue Code of 1986, as amended, and all regulations and formal guidance issued thereunder.

 

“Commitment”:  With respect to each Lender, the amount set forth on Schedule 1.1 as such Lender’s Commitment to make the Loan to Borrower in one or more Advances as provided herein, subject to increase in accordance with § 2.11.

 

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“Commitment Increase”:  An increase in the Total Commitment to not more than ONE HUNDRED MILLION DOLLARS ($100,000,000) more than the Total Commitment as of the Closing Date pursuant to § 2.11.

 

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

 

“Commitment Percentage”:  With respect to each Lender, the percentage set forth on Schedule 1.1 hereto as such Lender’s percentage of the aggregate Commitments of all of the Lenders, as the same may be changed from time to time in accordance with the terms of this Agreement.

 

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

 

“Compliance Certificate”:  See § 7.4(c).

 

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

 

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

 

“Consolidated EBITDA”:  With respect to any period, an amount equal to the EBITDA of Borrower and its Subsidiaries for such period determined on a Consolidated basis.

 

“Consolidated Fixed Charges”:  For any fiscal quarter, annualized, the sum of (a) Consolidated Interest Expense for such period, plus (b) all regularly scheduled principal payments made with respect to Indebtedness of Borrower and its Subsidiaries during such period, other than any balloon, bullet or similar principal payment which repays such Indebtedness in full, plus (c) all Preferred Distributions paid during such period.  Such Person’s Equity Percentage in the Consolidated Fixed Charges of its Unconsolidated Affiliates shall be included in the determination of Consolidated Fixed Charges; any Preferred Distributions constituting the repurchase or redemption of Preferred Securities (other than regularly scheduled mandatory repurchases or redemptions not constituting balloon, bullet or similar redemptions in full) shall not be included in the calculation of Consolidated Fixed Charges.

 

“Consolidated Interest Expense”:  For any period, without duplication, (a) total Interest Expense of Borrower and its Subsidiaries determined on a consolidated basis in accordance with GAAP for such period, plus (b) such Person’s Equity Percentage of Interest Expense of its Unconsolidated Affiliates for such period.

 

“Consolidated Tangible Net Worth”:  The amount by which Gross Asset Value exceeds Consolidated Total Indebtedness.

 

“Consolidated Total Indebtedness”:  All Indebtedness of Borrower and its Subsidiaries determined on a consolidated basis and shall include (without duplication), such Person’s Equity Percentage of the Indebtedness of its Unconsolidated Affiliates.

 

“Consolidated Unsecured Debt Yield”:  The quotient (expressed as a percentage) of Adjusted Net Operating Income from the Unencumbered Asset Pool (excluding any Leased Assets) divided by Unsecured Debt.

 

“Construction In Process”:  Costs incurred for any build-outs, redevelopment, construction, or tenant improvements of a Data Center Property that is not a Development Property.

 

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“Conversion/Continuation Request”:  A notice given by Borrower to the Agent in the form of Exhibit G hereto of its election to convert or continue an Advance in accordance with § 4.1.

 

“Credit Rating”:  The rating assigned by a Rating Agency to the corporate family of a Person.

 

“Data Center Property”:  Any asset that operates or is intended to operate, at least in part, as a telecommunications infrastructure building or an information technology infrastructure building.

 

“Debtor Relief Laws”:  The Bankruptcy Code, 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 and affecting the rights of creditors generally.

 

“Default”:  See § 12.1.

 

“Default Rate”:  See § 4.12.

 

“Defaulting Lender”:  Subject to § 14.16(b), any Lender that (a) has failed to (i) fund all or any Advance (or portion thereof) within two (2) Business Days of the date such Advance was required to be funded hereunder unless such Lender notifies the Agent and 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 Agent or any Lender any other amount required to be paid by it hereunder within two (2) Business Days of the date when due, (b) has notified Borrower or the Agent 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 an Advance 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 Agent or Borrower, to confirm in writing to the Agent and 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 Agent and Borrower), (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, or (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 (e) has become the subject of a Bail-In Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority 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 of America 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 Agent, in consultation with Borrower, that a Lender is a Defaulting Lender under any one or more of 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 § 14.16(b)) upon delivery of written notice of such determination to Borrower and each Lender.

 

“Derivatives Contract”:  Any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any

 

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combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement.  Not in limitation of the foregoing, the term “Derivatives Contract” includes any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other master agreement, including any such obligations or liabilities under any such master agreement.

 

“Derivatives Termination Value”:  In respect of any one or more Derivatives Contracts, after taking into account the effect of any legally enforceable netting agreement applicable to such Derivatives Contract(s), (a) for any date on or after the date such Derivatives Contracts have been closed out or terminated and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a) the amount(s) determined as the mark-to-market value(s) for such Derivatives Contracts, as determined based upon one or more mid-market quotations or other valuations provided by any recognized dealer in, or the counterparty to, such Derivatives Contract(s) (which, in either case, may include the Agent or any Lender).

 

“Designated Jurisdiction”:  At any time, a country, territory or region which is, or whose government is, the subject or target of country-wide or territory-wide Sanctions (currently, Cuba, Iran, Syria, North Korea, and the Crimea region of Ukraine).

 

“Development Property”:  Real Estate currently under development that has not become a Stabilized Property or on which the improvements related to the development have not been completed, provided that such a Development Property on which all improvements related to the development of such Real Estate have been substantially completed (excluding tenant improvements) for at least eighteen (18) months shall cease to constitute a Development Property notwithstanding the fact that such Property has not become a Stabilized Property, and shall be considered a Stabilized Property for the purposes of the calculation of Gross Asset Value.

 

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

 

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

 

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

 

“Drawdown Date”:  The date on which any Advance is made or is to be made, and the date on which any Advance which is made prior to the Maturity Date, is converted in accordance with § 4.1.

 

“EBITDA”:  With respect to a Person for any period (without duplication):  The net income (or loss), excluding the effects of straight lining of rents and acquisition lease accounting,  before (i) interest, income taxes, depreciation, and amortization expense, as reported by such Person and its Subsidiaries on a consolidated basis in accordance with GAAP and (ii) any other non-cash expense to the extent not actually paid as a cash expense (including any expense associated with asset retirement obligation under GAAP).  EBITDA shall exclude extraordinary gains and losses (including but not limited to gains (and loss) on the sale of assets) and distributions to minority owners.  EBITDA attributable to equity interests shall be excluded but

 

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EBITDA shall include a Person’s Equity Percentage of net income (or loss) from Unconsolidated Affiliates plus its Equity Percentage of interest, depreciation and amortization expense from Unconsolidated Affiliates.

 

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

 

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

 

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

 

“Electronic Signature(s)”:  An electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a person with the intent to sign, authenticate or accept such contract or record.

 

“Eligible Assignee”:  (a) a Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; and (d) any other Person (other than a natural person) approved by, unless an Event of Default has occurred and is continuing, Borrower (such approval not to be unreasonably withheld or delayed); provided that notwithstanding the foregoing, (i) neither Borrower nor any affiliate of Borrower or REIT shall be an Eligible Assignee and (ii) no Defaulting Lender or any of its Affiliates shall be an Eligible Assignee.

 

“Eligible Real Estate”:  Real Estate:

 

(a)           which is (i) wholly-owned (directly or indirectly) in fee, (ii) leased under a ground lease acceptable to the Required Lenders in theirAgent in its reasonable discretion, or (iii) a Leased Asset with a remaining term (including of right tenant extensions) of at least twentyfifteen (15) years as of the date hereofFirst Amendment Effective Date and is otherwise acceptable to the Required Lenders in theirAgent in its sole reasonable discretion, in each instance with such easements, rights-of-way, and other similar appurtenances required for the operation of the fee or leasehold property, by Borrower or a Subsidiary GuarantorPool Owner;

 

(b)           which is located within the 50 States of the United States or the District of Columbia;

 

(c)           which is improved by an income-producing Data Center Property and designated as a Stabilized Property;

 

(d)           as to which all of the representations set forth in § 6 of this Agreement concerning Eligible Real Estate Assets are true and correct except as would not reasonably be expected to result in a Material Adverse Effect; and

 

(e)           as to which the Agent has received all Eligible Real Estate Qualification Documents, or will receive them prior to inclusion of such Real Estate in the Unencumbered Asset Pool; and.

 

(f)            [Reserved].

 

“Eligible Real Estate Asset”:  (i) On the Closing Date, the Existing Unencumbered Assets and (ii) any Real Estate that is included in the Unencumbered Asset Pool from time to time pursuant to Article V of

 

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this Agreement.  For purposes of this definition, it is acknowledged and agreed that the Wilshire Property which is a Leased Asset shall be deemed an “Eligible Real Estate Asset”.

 

“Eligible Real Estate Qualification Documents”:  See Schedule 1.2 attached hereto.

 

“Employee Benefit Plan”:  Any employee benefit plan within the meaning of § 3(3) of ERISA maintained or contributed to by Borrower or any ERISA Affiliate, other than a Multiemployer Plan.

 

“Environmental Laws”:  All applicable past (which have current effect), present or future federal, state, county and local laws, by-laws, rules, regulations, codes and ordinances, or any legally binding judicial or administrative interpretations thereof, and the legally binding requirements of any governmental agency or authority having jurisdiction with respect thereto, applicable to pollution, the regulation or protection of the environment, the health and safety of persons and property (with respect to exposure to Hazardous Substances) and shall include, but not be limited to, all orders, decrees, judgments and rulings imposed through any public or private enforcement proceedings, relating to the existence, use, discharge, release, containment, transportation, generation, storage, management or disposal of Hazardous Substances.  Environmental Laws presently include, but are not limited to, the following laws:  Comprehensive Environmental Response Compensation and Liability Act (42 U.S.C. Section 9601 et seq.), the Hazardous Substances Transportation Act (49 U.S.C. Section 1801 et seq.), the Public Health Service Act (42 U.S.C. Section 300(f) et seq.), the Pollution Prevention Act (42 U.S.C. Section 13101 et seq.), the Federal Insecticide, Fungicide and Rodenticide Act (7 U.S.C. Section 136 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.), the Federal Clean Water Act (33 U.S.C. Section 1251 et seq.), Thethe Federal Clean Air Act (42 U.S.C. Section 7401 et seq.), and the applicable laws and regulations of the State in which the PropertyReal Estate is located.

 

“Equity Interests”:  With respect to any Person, any share of capital stock of (or other ownership or profit interests in) such Person, any warrant, option or other right for the purchase or other acquisition from such Person of any share of capital stock of (or other ownership or profit interests in) such Person, any security convertible into or exchangeable for any share of capital stock of (or other ownership or profit interests in) such Person or warrant, right or option for the purchase or other acquisition from such Person of such shares (or such other interests), and any other ownership or profit interest in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such share, warrant, option, right or other interest is authorized or otherwise existing on any date of determination.

 

“Equity Offering”:  The issuance and sale after January 3, 2013 by Borrower or any of its Subsidiaries or REIT of any equity securities of such Person.

 

“Equity Percentage”:  The aggregate ownership percentage of Loan Parties or their respective Subsidiaries in each Unconsolidated Affiliate.

 

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

 

“ERISA Affiliate”:  Any Person which is treated as a single employer with Borrower or its Subsidiaries under Section 414 of the Code.

 

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

 

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

 

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“Event of Default”:  See § 12.1.

 

“Excluded Swap Obligation”:  With respect to any Loan Party, any Swap Obligation if, and to the extent that, all or a portion of the guarantee of such Loan Party of, or the grant by such Loan Party 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 Loan Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the guarantee of such Loan Party 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”:  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 its Commitment pursuant to Legal Requirements in effect on the date on which (i) such Lender acquires such interest in the Loan or its Commitment (other than pursuant to an assignment request by Borrower under § 4.15 as a result of costs sought to be reimbursed pursuant to §4.4) or (ii) such Lender changes its lending office, except in each case to the extent that, pursuant to §4.4, 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 § 4.4(g) and (d) any Taxes imposed under FATCA.

 

“Existing Commitment Percentage”:  As of the Closing Date with respect to any Lender, the “Commitment Percentage” of such Lender as defined in the Existing Loan Agreement.

 

“Existing Credit Agreement”:  That certain ThirdFourth Amended and Restated Credit Agreement dated as of June 24, 2015April 19, 2018 by and among CoreSite, L.P., as parent borrower, CoreSite Real Estate 70 Innerbelt, L.L.C., CoreSite Real Estate 900 N. Alameda, L.L.CP., CoreSite Real Estate 2901 Coronado, L.L.CP., CoreSite Real Estate 1656 McCarthy, L.L.CP., CoreSite Real Estate 427 S. LaSalle, L.L.C., CoreSite Real Estate 2972 Stender, L.P., CoreSite Real Estate 12100 Sunrise Valley Drive L.L.C., CoreSite Real Estate 2115 NW 22nd, Street, L.L.C., CoreSite One Wilshire, L.L.C. and, Coresite Real Estate 55 S. Market Street, L.L.C. and CoreSite Real Estate 3032 Coronado, L.P., as subsidiary borrowers, Keybank National Association, as agent, and the lenders named therein, as amended, restated, extended, supplemented and otherwise modified from time to time and as refinanced and replaced from time to time, to the extent such refinancing or replacement is designated by Borrower in writing to the Agent as a refinancing or replacement of the Existing Credit Agreement.

 

“Existing Loan Agreement”:  See recitals hereto.

 

“Existing Unencumbered Assets”:  The Eligible Real Estate set forth on Schedule 1.3.

 

“Facility Assigned Rights and Obligations”:  See §2.10.

 

“Facility Availability”:  From time to time, the lesser of (a) the Total Commitment, or (b) the Unencumbered Asset Pool Availability.

 

“Facility Purchasing Lender”:  See §2.10.

 

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“Facility Selling Lender”:  See §2.10.

 

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

 

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

 

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

 

“First Amendment Effective Date”:  April 19, 2018.

 

“Fitch”:  Fitch Ratings, Inc.

 

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

 

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

 

“Funds from Operations”:  With respect to any Person for any period, an amount equal to the Net Income (or Loss) of such Person for such period, computed in accordance with NAREIT guidelines, excluding losses from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures.  Adjustments for unconsolidated partnerships and joint ventures will be recalculated to reflect funds from operations on the same basis.

 

“GAAP”:  Principles that are (a) consistent with the principles promulgated or adopted by the Financial Accounting Standards Board and its predecessors, as in effect from time to time and (b) consistently applied.

 

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

 

“Gross Asset Value”:  On a consolidated basis for Borrower and its Subsidiaries, Gross Asset Value shall mean the sum of (without duplication with respect to any Real Estate):

 

(i)                                     the Capitalized Value of any Stabilized Properties (other than the Leased Assets) owned by Borrower or any of its Subsidiaries; plus

 

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(ii)                                  for the Leased Assets, the Adjusted Net Operating Income of the Leased Assets multiplied by eightten (810);

 

(iii)                               the book value determined in accordance with GAAP of all Development Properties and Construction In Process with respect to Real Estate owned or leased by Borrower or any of its Subsidiaries; plus

 

(iv)                              the aggregate amount of:  (x) all Unrestricted Cash and Cash Equivalents of Borrower and its Subsidiaries and (y) Specified Restricted Cash and Cash Equivalents of Borrower and its Subsidiaries, as of the date of determination; plus

 

(v)                                 the book value determined in accordance with GAAP of Land Assets of Borrower and its Subsidiaries.

 

Gross Asset Value will be adjusted, as appropriate, for acquisitions, dispositions and other changes to the portfolio during the calendar quarter most recently ended prior to a date of determination.  In Borrower’s discretion, any Development Property which becomes a Stabilized Property and all newly acquired properties may be valued at GAAP book value for up to ninety (90) days, with such properties thereafter being included in the calculation of Gross Asset Value in accordance with subsections (i)—(iv) above.  All income, expense and value associated with assets included in Gross Asset Value disposed of during the calendar quarter period most recently ended prior to a date of determination will be eliminated from calculations.  Additionally, without limiting or affecting any other provision hereof, Gross Asset Value shall not include any income or value associated with Real Estate which is not operated or intended to be operated principally as a Data Center Property.  Gross Asset Value will be adjusted to include an amount equal to Borrower’s or any of its Subsidiaries’ pro rata share (based upon such Person’s Equity Percentage in such Unconsolidated Affiliate) of the Gross Asset Value attributable to any of the items listed above in this definition owned by such Unconsolidated Affiliate.

 

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

 

“Guarantors”:  Collectively, REIT and the Subsidiary Guarantors.

 

“Guaranty”:  That certain Amended and Restated Guaranty dated as of the date hereof executed by the Guarantors in favor of the Agent and the Lenders.

 

“Hazardous Substances”:  Mean and include (i) asbestos, flammable materials, explosives, radioactive substances, polychlorinated biphenyls, other carcinogens, oil and other petroleum products, radon gas, urea formaldehyde; (ii) chemicals, gases, solvents, pollutants or contaminants that could be a detriment or pose a danger to the environment or to the health or safety of any person; and (iii) any other hazardous or toxic materials, wastes and substances which are defined, determined or identified as such in any past, present or future federal, state or local laws, by-laws, rules, regulations, codes or ordinances or any legally binding judicial or administrative interpretation thereof in concentrations which violate Environmental Laws.

 

“Increase Notice”:  See § 2.11(a).

 

“Indebtedness”:  With respect to a Person, at the time of computation thereof, all of the following (without duplication):  (a) all obligations of such Person in respect of money borrowed (other than trade debt incurred in the ordinary course of business which is not more than one hundred eighty (180) days past due); (b) all obligations of such Person for money borrowed (i) represented by notes payable, or drafts accepted, in each case representing extensions of credit, (ii) evidenced by bonds, debentures, notes or similar instruments,

 

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 or (iii) constituting purchase money indebtedness, conditional sales contracts, title retention debt instruments or other similar instruments, upon which interest charges are customarily paid or that are issued or assumed as full or partial payment for property or services rendered; (c) obligation of such Person as a lessee or obligor under a CapitalizedFinancing Lease; (d) all reimbursement obligations of such Person under any letters of credit or acceptances (whether or not the same have been presented for payment); (e) all Off-Balance Sheet Obligations of such Person; (f) all obligations of such Person in respect of any purchase obligation, repurchase obligation, takeout commitment or forward equity commitment, in each case evidenced by a binding agreement (excluding any such obligation to the extent the obligation can be satisfied by the issuance of Equity Interests) (g) net obligations under any Derivatives Contract not entered into as a hedge against existing Indebtedness, in an amount not in excess of the Derivatives Termination Value thereof; (h) all Indebtedness of other Persons which such Person has guaranteed or is otherwise recourse to such Person (except for guaranties of customary exceptions for fraud, misapplication of funds, environmental indemnities, violation of “special purpose entity” covenants, and other similar exceptions to recourse liability, and except for completion guaranties, until in any case a claim is made and an action is commenced with respect thereto, and then shall be included only to the extent of the amount of such claim), including liability of a general partner in respect of liabilities of a partnership in which it is a general partner which would constitute “Indebtedness” hereunder, any obligation to supply funds to or in any manner to invest directly or indirectly in a Person, to maintain working capital or equity capital of a Person or otherwise to maintain net worth, solvency or other financial condition of a Person, to purchase indebtedness, or to assure the owner of indebtedness against loss, including, without limitation, through an agreement to purchase property, securities, goods, supplies or services for the purpose of enabling the debtor to make payment of the indebtedness held by such owner or otherwise; (i) all Indebtedness of another Person secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property or assets owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness or other payment obligation; and (j) such Person’s pro rata share of the Indebtedness (based upon its Equity Percentage in such Unconsolidated Affiliates) of any Unconsolidated Affiliate of such Person.  “Indebtedness” shall be adjusted to remove any impact of intangibles pursuant to ASC 805, as codified by the Financial Accounting Standards Board in June of 2009, and shall be adjusted to remove (a) the impact from Asset Retirement Obligations pursuant to ASC 410, as codified by the Financial Accounting Standards Board in June of 2009, and (b) any potential impact from the exposure draft issued by the Financial Accounting Standards Board in August of 2010 related to Leases (Topic 840).  and (c) any impact or effect as a result of changes related to the accounting of operating lease liabilities pursuant to Accounting Standards Update No. 2016-02, Leases (Topic 842), as issued by the Financial Accounting Standards Board on February 25, 2016.

 

“Indemnified Taxes”:  (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Borrower or any Guarantor under any Loan Document and (b) to the extent not otherwise described in the immediately preceding clause (a), Other Taxes.

 

“Information”:  See § 18.7

 

“Interest Expense”:  For any period with respect to Borrower and its Subsidiaries, without duplication, (a) interest (whether accrued or paid) actually payable (without duplication), excluding non-cash interest expense but including capitalized interest not funded under a construction loan, together with the interest portion of payments actually payable on CapitalizedFinancing Leases, plus (b) Borrower’s and its Subsidiaries’ Equity Percentage of Interest Expense of their Unconsolidated Affiliates for such period.

 

“Interest Payment Date”:  As to each Base Rate Advance, the fifth (5th) day of each calendar month and as to each LIBOR Rate Advance, the last day of the Interest Period with respect thereto.

 

“Interest Period”:  With respect to each LIBOR Rate Advance (a) initially, the period commencing on the Drawdown Date of such LIBOR Rate Advance and ending one, two, three or six months thereafter (subject to availability from each Lender), and (b) thereafter, each period commencing on the day following the last day of the next preceding Interest Period applicable to such Advance and ending on the last day of one of the

 

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periods set forth above, as selected by Borrower in a Loan Request or Conversion/Continuation Request; provided that all of the foregoing provisions relating to Interest Periods are subject to the following:

 

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

 

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

 

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

 

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

 

“Investment Grade Pricing Date”:  At any time after REIT or  Borrower has received an Investment Grade Rating, the date specified by Borrower in a written notice to the Agent and the Lenders as the date on which it irrevocably elects to have the Applicable Margin determined based on REIT’s or Borrower’s Credit Rating; provided that no Default or Event of Default shall exist on the date of such notice or the specified Investment Grade Pricing Date.

 

“Investment Grade Rating”:  A Credit Rating of BBB-/Baa3/BBB- (or the equivalent) or higher from a Rating Agency.

 

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

 

“Joinder Agreement”:  The Joinder Agreement with respect to this Agreement, the Guaranty, and the Notesother Loan Documents to be executed and delivered pursuant to § 5.3 by any Additional Subsidiary Guarantor, such Joinder Agreement to be substantially in the form of Exhibit C hereto.

 

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“Land Assets”:  Land with respect to which the commencement of grading, construction of improvements (other than improvements that are not material and are temporary in nature) or infrastructure has not yet commenced and for which no such work is reasonably scheduled to commence within the following twelve (12) months.

 

“Leased Assets”:  Real Estate (or a portion thereof) leased by Borrower or a Subsidiary under a lease which does not constitute a ground lease.

 

“Leased Asset NOI Amount”:  The Adjusted Net Operating Income of each Leased Asset in the Unencumbered Asset Pool multiplied by fourfive (45).

 

“Leased Rate”:  With respect to Real Estate at any time, the ratio, expressed as a percentage, of (a) the Net Rentable Area of such Real Estate actually leased by tenants that are not affiliated with Borrower and paying rent at rates not materially less than rates generally prevailing at the time the applicable lease was entered into, pursuant to binding leases as to which no default has occurred and has continued unremedied for thirty (30) or more days to (b) the aggregate Net Rentable Area of such Real Estate.

 

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

 

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

 

“Lender Offer Notice”:  See § 18.9.

 

“Lenders”:  RBC, the other lending institutions which are party hereto and any other Person which becomes an assignee of any rights of a Lender pursuant to § 18 (but not including any participant as described in § 18).

 

“Letter of Credit Liabilities”:  As defined in the Existing Credit Agreement.

 

“LIBOR”:  For any LIBOR Rate Advance for any Interest Period, the rate published on Reuters LIBOR01 page (or on any successor or substitute page of such service, or any successor to or substitute for such service, providing rate quotations comparable to those currently provided on such page of such service, as determined by the Agent from time to time for purposes of providing quotations of interest rates applicable to Dollar deposits in the London interbank market) at approximately 11:00 a.m. (London time), two LIBOR Business Days prior to the commencement of such Interest Period, with a term equivalent to such Interest Period or, provided that if LIBOR shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement and provided, further, that if such published rate is not available at such time for any reason, then LIBOR for such Interest Period shall be the rate per annum determined by the Agent to be the rate at which deposits for delivery on the first day of such Interest Period in same day funds in the approximate amount of the LIBOR Advance or Advances being made, continued or converted by RBC and with a term equivalent to such Interest Period would be offered by RBC’s London Branch to major banks in the London interbank LIBOR market at their request at approximately 11:00 a.m. (London time), two LIBOR Business Days prior to the commencement of such Interest Period.  For any period during which a Reserve Percentage shall apply, LIBOR with respect to LIBOR Rate Advances shall be equal to the amount determined above divided by an amount equal to 1 minus the Reserve Percentage.

 

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

 

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

 

“LIBOR Rate Advances”:  All Advances bearing interest at a rate based on LIBOR.

 

“Lien”:  See § 8.2.

 

“Loan Documents”:  This Agreement, the Notes, the Guaranty, and all other documents, instruments or agreements now or hereafter executed or delivered by or on behalf of Loan Parties in connection with the Loan (excluding, for the avoidance of doubt, any Derivatives Contract).

 

“Loan Parties”:  Collectively, Borrower and the Subsidiary Guarantors, and individually any of them.

 

“Loan Request”:  See § 2.7.

 

“Loan”:  The loan to be made by the Lenders hereunder comprised of the Advances.  The Loan shall be made in Dollars.

 

“Majority Lenders”:  As of any date, the Lender or Lenders whose aggregate Commitment Percentage is greater than fifty percent (50.0%) of the Total Commitment; provided that in determining said percentage at any given time, all then existing Defaulting Lenders will be disregarded and excluded and the Commitment Percentages of the Lenders shall be redetermined for voting purposes only to exclude the Commitment Percentages of such Defaulting Lenders.

 

“Management Agreements”:  Written agreements providing for the management of the Eligible Real Estate Assets or any of them.

 

“Material Acquisition”:  An acquisition that is (i) any single transaction for the purpose of, or resulting, directly or indirectly, in, the acquisition (including, without limitation, a merger or consolidation or any other combination with another Person) of a Person or assets by Borrower (directly or indirectly) that has a gross purchase price equal to or greater than ten percent (10.0%) of the then Gross Asset Value (without giving effect to such transaction), or (ii) one or more transactions for the purpose of, or resulting, directly or indirectly, in, the acquisition (including, without limitation, a merger or consolidation or any other combination with another Person) of one or more Persons or assets by Borrower (directly or indirectly) in any two (2) consecutive calendar quarters, which in the aggregate have a gross purchase price equal to or greater than ten percent (10.0%) of the then Gross Asset Value (without giving effect to such transactions).

 

“Material Acquisition Leased NOI Amount”:  The Adjusted Net Operating Income of each Leased Asset in the Unencumbered Asset Pool multiplied by six and one half (6.5).

 

“Material Adverse Effect”:  A material adverse effect on (a) the business, properties, assets, financial condition or results of operations of Borrower and its Subsidiaries considered as a whole; (b) the ability of Borrower or any Subsidiary Guarantor to perform any of its material obligations under the Loan Documents; or (c) the validity or enforceability of any of the Loan Documents or the material rights or remedies of the Agent or the Lenders thereunder.

 

“Maturity Date”:  April 19, 2022 or such earlier date on which the Loan shall become due and payable pursuant to the terms hereof.

 

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“Moody’s”:  Moody’s Investor Service, Inc.

 

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

 

“Net Income (or Loss)”:  With respect to any Person (or any asset of any Person) for any period, the net income (or loss) of such Person (or attributable to such asset), determined in accordance with GAAP.

 

“Net Offering Proceeds”:  The gross cash proceeds received by Borrower or any of its Subsidiaries or REIT as a result of an Equity Offering less the customary and reasonable costs, expenses and discounts paid by Borrower or such Subsidiary or REIT in connection therewith.

 

“Net Operating Income”:  For any Real Estate and for a given period, an amount equal to the sum of (a) the rents, common area reimbursements and other income for such Real Estate for such period received in the ordinary course of business from tenants in occupancy (excluding pre-paid rents and revenues and security deposits except to the extent applied in satisfaction of tenants’ obligations for rent) minus (b) all expenses paid or accrued and related to the ownership, operation or maintenance of such Real Estate for such period, including, but not limited to, taxes, assessments and the like, insurance, utilities, payroll costs, maintenance, repair and landscaping expenses, marketing expenses, and general and administrative expenses (excluding general overhead expenses of Borrower and its Subsidiaries and any asset management fees), minus (c)  management expenses of such Real Estate equal to three percent (3.0%) of the gross revenues from such Real Estate, minus (d) all rents, common area reimbursements and other income for such Real Estate received from tenants in default of obligations under their lease or with respect to leases as to which the tenant or any guarantor thereunder is subject to any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution, liquidation or similar debtor relief  proceeding unless such tenant has expressly assumed its obligations under the applicable lease in such proceeding; provided that Net Operating Income shall exclude, without duplication, the effect of extraordinary, unusual or non-recurring charges, expenses, losses or gains.

 

“Net Rentable Area”:  With respect to any Real Estate, the “Net Rentable Operating Square Footage” as defined in REIT’s most recent Form 10-K.

 

“Non-Consenting Lender”:  See § 18.9.

 

“Non-Excluded Taxes”:  See § 4.4(b).

 

“Non-Recourse Exclusions”:  With respect to any Non-Recourse Indebtedness of any Person, any usual and customary exclusions from the non-recourse limitations governing such Indebtedness, including, without limitation, exclusions for claims that (i) are based on fraud, intentional misrepresentation, misapplication or misappropriation of funds, gross negligence or willful misconduct, (ii) result from intentional mismanagement of or waste at the Real Estate securing such Non-Recourse Indebtedness, or (iii) arise from the presence of Hazardous Substances on the Real Estate securing such Non-Recourse Indebtedness (whether contained in a loan agreement, promissory note, indemnity agreement or other document), or (iv) are the result of any unpaid real estate taxes and assessments (whether contained in a loan agreement, promissory note, indemnity agreement or other document), or (v) result from such Person and/or its assets becoming the subject of a voluntary or involuntary bankruptcy, insolvency or similar proceeding.

 

“Non-Recourse Indebtedness”:  Indebtedness of Borrower, its Subsidiaries or an Unconsolidated Affiliate which is secured by one or more parcels of Real Estate (other than an Eligible Real Estate Asset) or interests therein or equipment and which is not a general obligation of Borrower or such Subsidiary or Unconsolidated Affiliate, the holder of such Indebtedness having recourse solely to the parcels of Real Estate, or interests therein, securing such Indebtedness, the leases thereon and the rents, profits and equity thereof or equipment, as applicable (except for recourse against the general credit of Borrower or its Subsidiaries or an Unconsolidated Affiliate for any Non-Recourse Exclusions), provided that in calculating the amount of Non-

 

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Recourse Indebtedness at any time, the amount of any Non-Recourse Exclusions which are the subject of a claim and action shall not be included in the Non-Recourse Indebtedness but shall constitute recourse Indebtedness.  Non-Recourse Indebtedness shall also include Indebtedness of a Subsidiary of Borrower that is not a Subsidiary Guarantor or of an Unconsolidated Affiliate which is a special purpose entity that is recourse solely to such Subsidiary or Unconsolidated Affiliate, which is not cross-defaulted to other Indebtedness of any Loan Party and which does not constitute Indebtedness of any other Person (other than such Subsidiary or Unconsolidated Affiliate which is the borrower thereunder).

 

“Note”:  A promissory note made by Borrower in favor of a Lender evidencing the Advances made by such Lender, substantially in the form of Exhibit A hereto.

 

“Notice”:  See § 19.

 

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

 

A.                                    The payment of the principal sum, interest at variable rates, charges and indebtedness with respect to the Loans (whether or not evidenced by the Notes) including any extensions, renewals, replacements, increases, modifications and amendments thereof, in the original aggregate amount of up to TWO HUNDRED MILLION DOLLARS ($200,000,000) given by Borrower to the order of the respective Lenders, as such amount may be increased in accordance with the provisions of § 2.11 hereof;

 

B.                                    The payment, performance, discharge and satisfaction of each covenant, warranty, representation, undertaking and condition to be paid, performed, satisfied and complied with by Borrower under and pursuant to this Agreement or the other Loan Documents;

 

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

 

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

 

E.                                     Any Approved Derivatives Contract.; provided, however, that under no circumstances shall any of the Obligations under any Approved Derivatives Contracts secured or guaranteed by any Loan Document as to a surety or guarantor thereof include any obligation that constitutes Excluded Swap Obligations of such Person.

 

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

 

“Off-Balance Sheet Obligations”:  Liabilities and obligations of Borrower, any Subsidiary or any other Person in respect of “off-balance sheet arrangements” (as defined in the SEC Off-Balance Sheet Rules) which Borrower would be required to disclose in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of Borrower’s report on Form 10-Q or Form 10-K (or their 

 

26

 

equivalents) which Borrower is required to file with the SEC or would be required to file if it were subject to the jurisdiction of the SEC (or any Governmental Authority substituted therefore having jurisdiction over Borrower).  As used in this definition, the term “SEC Off-Balance Sheet Rules” means the Disclosure in Management’s Discussion and Analysis About Off-Balance Sheet Arrangements, Securities Act Release No. 33-8182, 68 Fed. Reg. 5982 (Feb. 5, 2003) (codified at 17 C.F.R. pts. 228, 229 and 249).

 

“Other Connection Taxes”:  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 solely 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).

 

“Other Taxes”:  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 §4.15 as a result of costs sought to be reimbursed pursuant to §4.4).

 

“Outstanding”:  With respect to the Advances, the aggregate unpaid principal thereof as of any date of determination.

 

“Borrower”:  As defined in the preamble hereto.

 

“Participant Register”:  See §18.4.

 

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

 

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

 

“Permitted Liens”:  Liens, security interests and other encumbrances permitted by § 8.2.

 

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

 

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

 

“Pool Owner”:  From time to time with respect to any Eligible Real Estate, a Wholly Owned Subsidiary of Borrower which is the owner of the fee simple interest in, or the approved ground lessee of, such Eligible Real Estate.

 

“Potential Unencumbered Asset”:  Any property of Borrower or a Subsidiary GuarantorPool Owner which is not at the time included in the Unencumbered Asset Pool and which consists of (i) Eligible Real Estate, or (ii) Real Estate which is capable of becoming Eligible Real Estate in accordance with § 5.1.

 

“Preferred Distributions”:  For any period and without duplication, all Distributions paid, declared but not yet paid or otherwise due and payable during such period on Preferred Securities issued by Borrower or any of its Subsidiaries or REIT.  Preferred Distributions shall not include dividends or distributions (a) paid or

 

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payable solely in Equity Interests of identical class payable to holders of such class of Equity Interests; or (b) paid or payable to Borrower or any of its Subsidiaries.

 

“Preferred Securities”:  With respect to any Person, Equity Interests in such Person, which are entitled to preference or priority over any other Equity Interest in such Person in respect of the payment of dividends or distribution of assets upon liquidation, or both.

 

“Pricing Level”:  Such term shall have the meaning established within the definition of Applicable Margin.

 

“Proposed Modification”:  See § 27.

 

“PTE”:  A prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.

 

“RBC”:  As defined in the preamble hereto.

 

“Rating Agency”:  Each of (i) S&P, (ii) Moody’s, or (iii) Fitch, together with their respective successors; provided that if Borrower utilizes a Credit Rating by Fitch for purposes of determining an Investment Grade Rating as set forth in this Agreement, Borrower must also obtain and maintain an Investment Grade Rating from either S&P or Moody’s for purposes of determining such Investment Grade Rating.

 

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

 

“Recipient”:  The Agent and any Lender.

 

“Register”:  See § 18.2.

 

“REIT”:  CoreSite Realty Corporation, a Maryland corporation, general partner of Borrower and guarantor of the Obligations pursuant to the Guaranty.

 

“REIT Status”:  With respect to a Person, its status as a real estate investment trust as defined in Section 856(a) of the Code.

 

“Release”:  See § 6.20(c)(iii).

 

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

 

“Replacement Lender”:  See § 18.9.

 

“Required Lenders”:  As of any date, the Lender or Lenders whose aggregate Commitment Percentage is equal to or greater than sixty six and 7/10 percent (66.7%) of the Total Commitment; provided that (a) in determining said percentage at any given time, all then existing Defaulting Lenders will be disregarded and excluded and the Commitment Percentages of the Lenders shall be redetermined for voting purposes only to exclude the Commitment Percentages of such Defaulting Lenders, and (b) at all times when there are two (2) or more Lenders under this Agreement, Required Lenders shall also require at least two (2) Lenders.

 

“Reserve Percentage”:  For any Interest Period, that percentage which is specified three (3) Business Days before the first day of such Interest Period by the Board of Governors of the Federal Reserve System (or 

 

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any successor) or any other governmental or quasi-governmental authority with jurisdiction over the Agent or any Lender for determining the maximum reserve requirement (including, but not limited to, any marginal reserve requirement) for the Agent or any Lender with respect to liabilities constituting of or including (among other liabilities) Eurocurrency liabilities in an amount equal to that portion of the Loan affected by such Interest Period and with a maturity equal to such Interest Period.

 

“Revolver Facility Availability”:  The “Facility Availability” as defined in the Existing Credit Agreement.

 

“Revolver Loans”:  The “Loans” as defined in the Existing Credit Agreement.

 

“Revolver Provisions”:  See § 27.

 

“Revolver Unencumbered Asset Pool”:  The “Unencumbered Asset Pool” as defined in the Existing Credit Agreement.

 

“Sanctioned Entity”:  Means (a) an agency, political subdivision, or instrumentality of the government of, (b) an organization directly or indirectly controlled by or (c) a Person or group resident in, in each case, a country that is itself subject to Sanctions (at the time of this Agreement, Crimea, Cuba, Iran, North Korea, Sudan and Syria).

 

“Sanctioned Person”:  AAny Person or group named on the list of Specially Designated Nationals or Blocked Persons maintained by the OFAC as published from time to time orthat is (i) any Person listed in any Sanctions-related list of designated Persons maintained by any Governmental Authority of the United States of America, including without limitation, OFAC or the U.S. Department of State, or by the United Nations Security Council, Her Majesty’s Treasury, or the European Union, or any EU member state.(ii) any Person located, operating, organized or resident in a Designated Jurisdiction, (iii) an agency of the government of a Designated Jurisdiction, or (iv) any Person owned or controlled by any Person or agency described in any of the preceding clauses (i) through (iii).

 

“Sanctions”:  Economic or financial sanctionsAny economic or trade embargoes imposed,sanction administered or enforced from time to time by (a) the U.S. government,United States Government (including those administered bywithout limitation, OFAC or), the U.S. Department of State or (b) the United Nations Security Council, the European Union, or Her Majesty’s Treasury of the United Kingdom, in each case, solely to the extent applicable to REIT or any of its Subsidiaries.

 

“SEC”:  The federal Securities and Exchange Commission.

 

“Secured Debt”:  With respect to Borrower or any of its Subsidiaries as of any given date, the aggregate principal amount of all Indebtedness of such Persons on a Consolidated basis outstanding at such date and that is secured in any manner by any Lien.

 

“Secured Recourse Indebtedness”:  As of any date of determination, any secured Indebtedness which is recourse to Borrower or any of its Subsidiaries.  Secured Recourse Indebtedness shall not include Non-Recourse Indebtedness.

 

“Senior Notes”:  Borrower’s $150,000,000 aggregate principal amount of 4.19% Senior Notes due 2023 and Borrower’s $175,000,000 aggregate principal amount of 3.91% Senior Notes due 2024, each guaranteed on a senior unsecured basis by REIT and the Subsidiary Guarantors.  For the avoidance of doubt, the Senior Notes shall rank pari passu with the Obligations under this Agreement so long as all remain unsecured indebtedness.

 

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

 

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“Specified Restricted Cash and Cash Equivalents”:  As of any date of determination, the sum of (a) the aggregate amount of cash and (b) the aggregate amount of Cash Equivalents (valued at fair market value), where the specified asset is subject to an escrow, reserve, Lien or claim in favor of a Person solely with respect to, and associated with, Indebtedness not prohibited hereunder.

 

“Stabilized Property”:  A completed project that has achieved a Leased Rate of at least seventy-five percent (75%), provided that a Development Property on which all improvements related to the development of such Real Estate have been substantially completed (excluding tenant improvements) for at least eighteen (18) months shall constitute a Stabilized Property.  Additionally, any Development Property which has a Capitalized Value exceeding or equal to its undepreciated GAAP book value shall constitute a Stabilized Property.  Once a project becomes a Stabilized Property under this Agreement, it shall remain a Stabilized Property.

 

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

 

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

 

“Subsidiary Guarantor Unencumbered Assets”:  See § 5.1(a).

 

“Subsidiary Guarantors”:  Subject to §§ 5.3 and § 5.4 hereof, CoreSite Real Estate 70 Innerbelt, L.L.C., a Delaware limited liability company,; CoreSite Real Estate 900 N. Alameda, L.P.,; a Delaware limited partnership,; CoreSite Real Estate 2901 Coronado, L.P., a Delaware limited partnership,; CoreSite Real Estate 1656 McCarthy, L.P., a Delaware limited partnership,; CoreSite Real Estate 427 S. LaSalle, L.L.C., a Delaware limited liability company,; CoreSite Real Estate 2972 Stender, L.P., a Delaware limited partnership,; CoreSite Real Estate 12100 Sunrise Valley Drive L.L.C., a Delaware limited liability company,; CoreSite Real Estate 2115 NW 22nd Street, L.L.C., a Delaware limited liability company,; CoreSite One Wilshire, L.L.C., a Delaware limited liability company,; CoreSite Real Estate 55 S. Market Street, L.L.C., a Delaware limited liability company; and CoreSite Real Estate 3032 Coronado, L.P., a Delaware limited partnership.

 

“Survey”:  An instrument survey of each parcel of Eligible Real Estate Asset prepared by a registered land surveyor which shall show the location of all buildings, structures, easements and utility lines on such property, shall show that all buildings and structures are within the lot lines of the Eligible Real Estate Asset and shall not show any encroachments by others (or to the extent any encroachments are shown, such encroachments shall be Permitted Liens or otherwise acceptable to the Agent in its reasonable discretion), and shall show rights of way, adjoining sites, establish building lines and street lines, the distance to and names of the nearest intersecting streets.

 

“Swap Obligation”:  With respect to any Loan Party, 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.

 

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

 

“The Carlyle Group”:  Collectively, Carlyle Realty Partners III, L.P., Carlyle Realty Partners IV, L.P. and Carlyle Realty Partners V, L.P., and each of their respective Affiliates (other than their respective portfolio companies).

 

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“Titled Agents”:  The Arrangers and the Syndication Agent.

 

“Title Insurance Company”:  Any nationally-recognized title insurance company or companies selected by Borrower or any other title insurance company or companies selected by Borrower and reasonably approved by the Agent.

 

“Title Policy”:  An ALTA standard form owner’s title insurance policy (or, if such form is not available, an equivalent form of owner’s title insurance policy), or a title report as of a recent date, in each case, issued by a Title Insurance Company showing that the applicable LoanTransaction Party holds marketable fee simple title or a valid and subsisting leasehold interest to such parcel, subject only to Permitted Liens and any other encumbrances acceptable to the Agent in its reasonable discretion.

 

“Total Commitment”:  The sum of the Commitments of the Lenders, as in effect from time to time as set forth on Schedule 1.1.  The Total Commitment may increase in accordance with § 2.11.

 

“Transaction Party”:  Each Loan Party and each Pool Owner.

 

“Transferred Interest”:  See § 18.9.

 

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

 

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

 

“U.S. Tax Compliance Certificate”:  See §4.4(g)(ii)(B)(III).

 

“Unconsolidated Affiliate”:  In respect of any Person, any other Person in whom such Person holds an Investment, (a) whose financial results would not be consolidated under GAAP with the financial results of such first Person on the consolidated financial statements of such first Person, or (b) which is not a Subsidiary of such first Person.

 

“Unconsolidated Subsidiary”:  In respect of any Person, any other Person in whom such Person holds an Investment, whose financial results would not be consolidated under GAAP with the financial results of such first Person on the consolidated financial statements of such first Person.

 

“Unencumbered Assets”:  See §5.1(a).

 

“Unencumbered Asset Pool”:  All of the Eligible Real Estate Assets.

 

“Unencumbered Asset Pool Availability”:  The Unencumbered Asset Pool Availability shall be the amount which is the least of (a) the maximum principal amount which would not cause the Unsecured Debt to be greater than the Unencumbered Asset Pool Value, and (b) the aggregate of (i) the maximum principal amount which would not cause the Consolidated Unsecured Debt Yield to be less than fourteen percent (14(x) twelve percent (12%), or (y) for a period of up to two (2) fiscal quarters following a Material Acquisition, eleven and one half percent (11.5%), plus (ii) (x) the Leased Asset NOI Amount or (y) for a period of up to two (2) fiscal quarters following a Material Acquisition, the Material Acquisition Leased Asset NOI Amount; provided further that the Unencumbered Asset Pool Availability resulting from Eligible Real Estate Assets which are ground leases and/or Leased Assets shall not at any time exceed thirty percent (30%) of the Unencumbered Asset Pool Availability.

 

“Unencumbered Asset Pool Value”:  The aggregate of (a) .60 multiplied by the Capitalized Value of the Unencumbered Asset Pool (excluding the Leased Assets), plus (b) the Leased Asset NOI Amount.; provided, however, that for a period of up to two (2) fiscal quarters following a Material Acquisition the 

 

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Unencumbered Asset Pool Value shall be permitted to increase to a maximum aggregate of (i) .65 multiplied by the Capitalized Value of the Unencumbered Asset Pool (excluding the Leased Assets), plus (ii) the Material Acquisition Leased Asset NOI Amount.

 

“Unhedged Variable Rate Debt”:  Any Indebtedness with respect to which the interest is not fixed (or hedged to a fixed rate) or capped for the entire term of such Indebtedness to maturity.

 

“Unrestricted Cash and Cash Equivalents”:  As of any date of determination, the sum of (a) the aggregate amount of Unrestricted cash and (b) the aggregate amount of Unrestricted Cash Equivalents (valued at fair market value).  As used in this definition, “Unrestricted” means the specified asset is not subject to any escrow, reserves or Liens or claims of any kind in favor of any Person.

 

“Unsecured Debt”:  Indebtedness of REIT, Borrower, the Subsidiary Guarantors or any of their respective Subsidiaries outstanding at any time which is not Secured Debt, including, without limitation, the Revolver Loans and the Senior Notes.

 

“Wholly Owned Subsidiary”:  As to Borrower, any Subsidiary of Borrower that is directly or indirectly owned 100% by Borrower.

 

“Wilshire Property”:  The premises leased by CoreSite One Wilshire, L.L.C. (f/k/a CRG West One Wilshire, L.L.C.) in the building located at 624 S. Grand Avenue, Los Angeles, California pursuant to that certain lease dated August 1, 2007 entered into between CRG West One Wilshire, L.L.C. as tenant and Hines Reit One Wilshire LP as landlord and its permitted successors and assigns.

 

“Withholding Agent”:  Any Loan Party and the Agent.

 

“Write-Down and Conversion Powers”:  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 writedown and conversion powers are described in the EU Bail-In Legislation Schedule.

 

§ 1.2                     Rules of Interpretation.

 

(a)                                 A reference to any document or agreement shall include such document or agreement as amended, modified or supplemented from time to time in accordance with its terms and the terms of this Agreement.

 

(b)                                 The singular includes the plural and the plural includes the singular.

 

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

 

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

 

(e)                                  Accounting terms not otherwise defined herein have the meanings assigned to them by GAAP applied on a consistent basis by the accounting entity to which they refer.

 

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

 

(g)                                  The words “approval” and “approved”, as the context requires, means an approval in writing given to the party seeking approval after full and fair disclosure to the party giving approval of all material facts necessary in order to determine whether approval should be granted.

 

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(h)                                 All terms not specifically defined herein or by GAAP, which terms are defined in the Uniform Commercial Code as in effect in the State of New York, have the meanings assigned to them therein.

 

(i)                                     Reference to a particular “§”, refers to that § of this Agreement unless otherwise indicated.

 

(j)                                    The words “herein”, “hereof”, “hereunder” and words of like import shall refer to this Agreement as a whole and not to any particular Section or subdivision of this Agreement.

 

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

 

SECTION 2

 

MAKING OF THE LOAN

 

§ 2.1                     The Loan.  (a) Subject to the terms and conditions set forth in this Agreement, on the Closing Date each Lender severally and not jointly agrees to make a single Advance to Borrower in an amount equal to its Commitment Percentage of the Loan.

 

§ 2.2                     (b) [Intentionally Omitted].

 

§ 2.3                     § 2.2 [Intentionally Omitted].

 

§ 2.4                     § 2.3 [Intentionally Omitted].

 

§ 2.5                     § 2.4 [Intentionally Omitted].

 

§ 2.6                     § 2.5 [Intentionally Omitted].

 

§ 2.7                     § 2.6 Interest.

 

(a)                                 Each Base Rate Advance shall bear interest for the period commencing with the Drawdown Date thereof and ending on the date on which such Base Rate Advance is repaid or converted to a LIBOR Rate Advance at the rate per annum equal to the sum of the Base Rate plus the Applicable Margin for Base Rate Advances.

 

(b)                                 Each LIBOR Rate Advance shall bear interest for the period commencing with the Drawdown Date thereof and ending on the last day of each Interest Period with respect thereto at the rate per annum equal to the sum of LIBOR determined for such Interest Period plus the Applicable Margin for LIBOR Rate Advances.

 

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(c)                                  Borrower promises to pay interest on each Advance in arrears on each applicable Interest Payment Date with respect thereto.

 

(d)                                 Base Rate Advances and LIBOR Rate Advances may be converted to Advances of the other Type as provided in § 4.1.

 

(e)                                  [Intentionally Omitted].

 

(f)                                   If, as a result of any restatement of or other adjustment to the financial statements of Borrower (excluding any restatements or adjustments resulting from a change in GAAP or other accounting methodology, legislation or standards) or other miscalculation verified by both Borrower and the Lenders, acting reasonably and in good faith, Borrower or the Lenders determine that (i) the Consolidated Total Indebtedness to Gross Asset Value as calculated as of any applicable date was inaccurate and (ii) a proper calculation of the Consolidated Total Indebtedness to Gross Asset Value would have resulted in higher pricing for such period, Borrower shall immediately and retroactively be obligated to pay to the Agent for the account of the applicable Lenders, promptly on demand by the Agent (or, after the occurrence of an actual or deemed entry of an order for relief with respect to Borrower under the Bankruptcy Code of the United States, automatically and without further action by the Agent or any Lender), an amount equal to the excess of the amount of interest and fees that should have been paid for such period over the amount of interest and fees actually paid for such period.  Borrower’s obligations under this paragraph shall survive until the termination of the aggregate Commitments and the repayment of all other Obligations hereunder.

 

§ 2.8                     § 2.7 Requests for Advance.  Borrower shall give to the Agent written notice executed by an Authorized Officer in the form of Exhibit C hereto (or telephonic notice confirmed in writing in the form of Exhibit C hereto) of each Advance requested hereunder (a “Loan Request”) by 1:00 p.m. (Eastern time) one (1) Business Day prior to the proposed Drawdown Date with respect to Base Rate Advances and with respect to LIBOR Rate Advances (a) in the case of the Advances to be made on the Closing Date, two (2) Business Days prior to the Closing Date and (b) in the case of any other LIBOR Rate Advances, three (3) Business Days prior to the proposed Drawdown Date, unless the timing of such notice is waived or reduced by the Agent in its sole discretion.  Each such notice shall specify with respect to the requested Advance the proposed principal amount of such Advance, the Type of Advance, the initial Interest Period (if applicable) for such Advance and the Drawdown Date.  Promptly upon receipt of any such notice, the Agent shall notify each of the Lenders thereof.  Each Loan Request shall be irrevocable and binding on Borrower and shall obligate Borrower to accept the Advance requested from the Lenders on the proposed Drawdown Date.  Nothing herein shall prevent Borrower from seeking recourse against any Lender that fails to advance its proportionate share of a requested Advance as required by this Agreement.  Each Loan Request shall be, subject to § 2.1(b), (a) for Base Rate Advances in a minimum aggregate amount of $1,000,000 or an integral multiple of $100,000 in excess thereof; or (b) for LIBOR Rate Advances in a minimum aggregate amount of $1,000,000 or an integral multiple of $250,000 in excess thereof; provided, however, that there shall be no more than ten (10) LIBOR Rate Advances outstanding at any one time.

 

§ 2.9                     § 2.8 Funds for Advances.

 

(a)                                 Not later than 3:00 p.m. (Eastern time) on the proposed Drawdown Date of any Advance, each of the Lenders will make available to the Agent, at the Agent’s Head Office, in immediately available funds, the amount of such Lender’s Commitment Percentage of the amount of the requested Advance which may be disbursed pursuant to § 2.1.  Upon receipt from each such Lender of such amount, and upon receipt of the documents required by § 10 and § 11 and the satisfaction of the other conditions set forth therein, to the extent applicable, the Agent will make available to Borrower the aggregate amount of such Advance made available to the Agent by the Lenders by crediting such amount to the account of Borrower maintained at the Agent’s Head Office.  The failure or refusal of any Lender to make available to the Agent at the aforesaid time and place on any Drawdown Date the amount of its Commitment Percentage of the requested Advance

 

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shall not relieve any other Lender from its several obligation hereunder to make available to the Agent the amount of such other Lender’s Commitment Percentage of any requested Advance, including any additional Advance that may be requested subject to the terms and conditions hereof to provide funds to replace those not advanced by the Lender so failing or refusing.  In the event of any such failure or refusal, the Lenders not so failing or refusing shall be entitled to a priority secured position as against the Lender or Lenders so failing or refusing to make available to Borrower the amount of its or their Commitment Percentage for such Advances as provided in § 12.5.

 

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

 

§ 2.10              § 2.9 Use of Proceeds.  Borrower will use the proceeds of the Loan solely for working capital and other general corporate purposes, including real estate acquisitions, development, redevelopment, capital expenditures and repayment of Indebtedness.

 

§ 2.11              § 2.10 Reallocation of Lender Commitment Percentages; No Novation.  On the Closing Date, the Advances made under the Existing Loan Agreement shall be deemed to have been made under this Agreement, without the execution by the Borrower or the Lenders of any other documentation, and all such Advances currently outstanding shall be deemed to have been simultaneously reallocated among the Lenders as follows:

 

(a)                                 (a)                                 On the Closing Date, each Lender that will have a greater Commitment Percentage of the Facility upon the Closing Date than its Existing Commitment Percentage immediately prior to the Closing Date (each, a “Facility Purchasing Lender”), without executing an Assignment and Acceptance Agreement, shall be deemed to have purchased assignments pro rata from each Lender that will have a smaller Commitment Percentage of the Facility upon the Closing Date than its Existing Commitment Percentage immediately prior to the Closing Date (each, a “Facility Selling Lender”) in all such Facility Selling Lender’s rights and obligations under this Agreement and the other Loan Documents as a Lender (collectively, the “Facility Assigned Rights and Obligations”) so that, after giving effect to such assignments, each Lender shall have its respective Commitment Percentage as set forth in Schedule 1.1 hereto and a corresponding Commitment Percentage of all Advances then outstanding under the Facility.  Each such purchase hereunder shall be at par for a purchase price equal to the principal amount of the loans and without recourse, representation or warranty, except that each Facility Selling Lender shall be deemed to represent and warrant to each Facility Purchasing Lender that the Facility Assigned Rights and Obligations of such Facility Selling Lender are not subject to any Liens created by that Facility Selling Lender.  For the avoidance of doubt, in no event shall the aggregate amount of each Lender’s Advances outstanding at any time exceed its Commitment Percentage as set forth in Schedule 1.1 hereto

 

(b)                                 (b)                                 Each Lender hereunder hereby waives any loss, cost or expense incurred by it as a result of the reallocations set forth in § 2.10(a) above in respect of LIBOR Rate Advances to the extent such reallocations take place on a day other than the last day of the Interest Period for such LIBOR Rate Advances.

 

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(c)                                  (c)                                  The Agent shall calculate the net amount to be paid or received by each Lender in connection with the assignments effected hereunder on the Closing Date.  Each Lender required to make a payment pursuant to this § 2.10 shall make the net amount of its required payment available to the Agent, in same day funds, at the office of the Agent not later than 12:00 P.M. (Eastern time) on the Closing Date.  The Agent shall distribute on the Closing Date the proceeds of such amounts to the Lenders entitled to receive payments pursuant to this § 2.10, pro rata in proportion to the amount each such Lender is entitled to receive at the primary address set forth on its signature page hereto or at such other address as such Lender may request in writing to the Agent.

 

(d)                                 (d)                                 Nothing in this Agreement shall be construed as a discharge, extinguishment or novation of the Obligations of the Loan Parties outstanding under the Existing Loan Agreement or any instruments securing the same, which Obligations shall remain outstanding under this Agreement after the date hereof as “Advances” except as expressly modified hereby or by instruments executed concurrently with this Agreement.

 

§ 2.12              § 2.11 Increase in Total Commitment.

 

(a)                                 Provided that no Default or Event of Default has occurred and is continuing, subject to the terms and conditions set forth in this § 2.11, Borrower shall have the option at any time and from time to time before the date that is thirty (30) days prior to the Maturity Date to request an increase in the Total Commitment to not more than ONE HUNDRED MILLION DOLLARS ($100,000,000) more than the Total Commitment as of the Closing Date by giving written notice to the Agent (an “Increase Notice”; and the amount of such requested increase is the “Commitment Increase”), provided that any such individual increase must be in a minimum amount of $25,000,000 and incremental amounts of $5,000,000 in excess thereof.  Upon receipt of any Increase Notice, the Agent shall consult with Arrangers and shall notify Borrower of the amount of upfront fees to be paid to any Lenders who provide an additional Commitment in connection with such increase in the Total Commitment (which shall be in addition to the fees to be paid to the Agent or Arrangers pursuant to the Agreement Regarding Fees).  If Borrower agrees to pay the upfront fees so determined, then the Agent, Arrangers or Borrower may, but shall not be obligated to, invite one or more banks or lending institutions (which banks or lending institutions shall be reasonably acceptable to the Agent, Arrangers and Borrower) to become Lenders and provide additional Commitments and/or one or more existing Lenders to increase their Commitments in an aggregate amount consistent with the Increase Notice.  The Agent shall provide all Lenders with a notice setting forth the amount, if any, of the additional Commitment to be provided by each Lender and the revised Commitment Percentages which shall be applicable after the effective date of the Commitment Increase specified therein (the “Commitment Increase Date”).  In no event shall any Lender be obligated to provide an additional Commitment.  Any Commitment Increase and the additional Advance in respect of such Commitment Increase (which Advance shall be in such principal amount as shall cause the outstanding Advances of each Lender to be held consistent with its Commitment Percentage after giving effect to the Commitment Increase) to be made by each Lender increasing its Commitment or issuing a new Commitment shall be evidenced by a supplement to this Agreement executed by the Agent, Borrower and any Lender increasing its Commitment or issuing a new Commitment, which supplement may include such amendments to this Agreement as the Agent deems reasonably necessary or appropriate to implement the transactions contemplated by this § 2.11.

 

(b)                                 On the Commitment Increase Date, the Advances then outstanding and such additional Advance shall be combined so that all Lenders (including any Lender issuing a new Commitment) hold pro rata amounts of the Loan (including such additional Advance) of each Type and Interest Period in their respective Commitment Percentages as determined after giving effect to such additional Advance.

 

(c)                                  Upon the effective date of each increase in the Total Commitment pursuant to this § 2.11 the Agent may unilaterally revise Schedule 1.1 and Borrower shall, if requested by such Lender, execute and deliver to the Agent new Notes for each Lender whose Commitment has changed (or any Lender issuing a new Commitment that has requested a Note) so that the principal amount of such Lender’s Note shall equal its 

 

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Commitment.  The Agent shall deliver such replacement Notes to the respective Lenders in exchange for the Notes replaced thereby which shall be surrendered by such Lenders.  Such new Notes shall provide that they are replacements for the surrendered Notes and that they do not constitute a novation, shall be dated as of the Commitment Increase Date and shall otherwise be in substantially the form of the replaced Notes.

 

(d)                                 Notwithstanding anything to the contrary contained herein, the obligation of the Agent and the Lenders to increase the Total Commitment pursuant to this § 2.11 shall be conditioned upon satisfaction or waiver of the following conditions precedent which must be satisfied or waived prior to the effectiveness of any increase of the Total Commitment:

 

(i)                                     Payment of Activation Fee.  Borrower shall pay (A) to the Agent those fees described in and contemplated by the Agreement Regarding Fees with respect to the applicable Commitment Increase, and (B) to the Arrangers such upfront fees as the Lenders who are providing an additional Commitment may require to increase the aggregate Total Commitment, which fees shall, when paid, be fully earned and non-refundable under any circumstances.  The Arrangers shall pay to the Lenders acquiring the increased Commitment certain fees pursuant to their separate agreement; and

 

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

 

(iii)                               Representations True.  The representations and warranties made by Loan Parties in the Loan Documents or otherwise made by or on behalf of Loan Parties in connection therewith or after the date thereof shall have been true and correct in all material respects when made and shall also be true and correct in all material respects on the date of such Increase Notice and on the date the Total Commitment is increased, both immediately before and after the Total Commitment is increased; and

 

(iv)                              Additional Documents and Expenses.  Loan Parties shall execute and deliver to the Agent and the Lenders such additional documents, instruments, certifications and opinions as the Agent may reasonably require, including, without limitation, a Compliance Certificate, demonstrating compliance with all covenants set forth in the Loan Documents after giving effect to the increase, and Borrower shall pay the cost of any updated UCC searches and any and all intangible taxes or other taxes, assessments or charges or any similar fees, taxes or expenses which are demanded in connection with such increase.

 

SECTION 3

 

REPAYMENT OF THE ADVANCES

 

§ 3.1                     Stated Maturity.  Borrower promises to pay on the Maturity Date the full amount of the Loan outstanding on such date and all of the Advances outstanding on such date shall become absolutely due and payable on the Maturity Date, together with any and all accrued and unpaid interest thereon.

 

§ 3.2                     Mandatory Prepayments.  If at any time the outstanding principal balance of the Revolver Loans, the Loan, the Letter of Credit Liabilities and all other Unsecured Debt exceeds the Unencumbered Asset Pool Availability (including, without limitation, as a result of the termination of any ground lease or any lease of a Leased Asset related to an Eligible Real Estate Asset), then Borrower shall, within ten (10) Business Days after the receipt of notice from the Agent of such occurrence, pay the amount of such excess as a payment of principal to the holder or holders of any Unsecured Debt, together with any additional amounts required to be paid to such holder or holders in connection with such principal payments of Indebtedness.

 

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§ 3.3                     Optional Prepayments.

 

(a)                                 Borrower shall have the right, at its election, to prepay the outstanding amount of the Loan, as a whole or in part, at any time without penalty or premium; provided, that if any prepayment of the outstanding amount of any LIBOR Rate Advances pursuant to this § 3.3 is made on a date that is not the last day of the Interest Period relating thereto, such prepayment shall be accompanied by the payment of any amounts due pursuant to § 4.8.

 

(b)                                 Borrower shall give the Agent, no later than 10:00 a.m. (Eastern time) at least threetwo (32) days prior written notice for any LIBOR Rate Loans, and one (1) day prior written notice for any Base Rate Loans, of any prepayment pursuant to this § 3.3, in each case specifying the proposed date of prepayment of the Loan or portion thereof and the principal amount to be prepaid (provided that (i) any such notice may be revoked or modified upon one (1) day’s prior notice to the Agent) and (ii) any such notice may be conditioned upon the consummation of a transaction.

 

§ 3.4                     Partial Prepayments.  Each partial prepayment of the Loan or portion thereof under § 3.3 shall be in a minimum principal amount of $1,000,000 or an integral multiple of $100,000 in excess thereof, shall be accompanied by the payment of accrued interest on the principal prepaid to the date of payment.  Each partial payment under § 3.2 and § 3.3 shall be applied first to the principal of Base Rate Advances, and then to the principal of LIBOR Rate Advances.

 

§ 3.5                     Effect of Prepayments.  Amounts of the Loan prepaid under § 3.2 and § 3.3 prior to the Maturity Date may not be reborrowed.

 

SECTION 4

 

CERTAIN GENERAL PROVISIONS

 

§ 4.1                     Conversion Options.

 

(a)                                 Borrower may by notice to the Agent in the form of Exhibit G hereto elect from time to time to convert any of the outstanding Advances to Advances of another Type and such Advances shall thereafter bear interest as a Base Rate Advance or a LIBOR Rate Advance, as applicable; provided that (i) with respect to any such conversion of a LIBOR Rate Advance to a Base Rate Advance, Borrower shall give the Agent at least one (1) Business Day’s prior written notice of such election, and such conversion shall only be made on the last day of the Interest Period with respect to such LIBOR Rate Advance unless Borrower pays Breakage Costs as required under this Agreement; (ii) with respect to any such conversion of a Base Rate Advance to a LIBOR Rate Advance, Borrower shall give the Agent at least threetwo (32) LIBOR Business Days’ prior written notice of such election and the Interest Period requested for such Advance, the principal amount of the Loan so converted shall be in a minimum aggregate amount of $1,000,000 or an integral multiple of $250,000 in excess thereof and, after giving effect to the making of such Advance, there shall be no more than ten (10) LIBOR Rate Advances outstanding at any one time; and (iii) no Advance may be converted into a LIBOR Rate Advance when any Default or Event of Default has occurred and is continuing.  All or any part of the outstanding Advances of any Type may be converted as provided herein, provided that no partial conversion shall result in a Base Rate Advance in a principal amount of less than $1,000,000 or an integral multiple of $100,000 in excess thereof or a LIBOR Rate Advance in a principal amount of less than $1,000,000 or an integral multiple of $250,000 in excess thereof.  On the date on which such conversion is being made, each Lender shall take such action as is necessary to transfer its Commitment Percentage of such Advances to its Domestic Lending Office or its LIBOR Lending Office, as the case may be.  Each Conversion/Continuation Request relating to the conversion of a Base Rate Advance to a LIBOR Rate Advance shall be irrevocable by Borrower.  For purposes of this §4.1(a), the words “executed,” “signed,” “signature,” “deliver,” “delivery,” and words of like import in or relating to a Conversion/Continuation 

 

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Request to be signed in connection with this Agreement and the transactions contemplated hereby shall be deemed to include Electronic Signatures, deliveries 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, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that nothing herein shall require the Agent to accept electronic signatures in any form or format without its prior written consent.

 

(b)                                 Any LIBOR Rate Advance may be continued as such Type upon the expiration of an Interest Period with respect thereto by compliance by Borrower with the terms of § 4.1; provided that no LIBOR Rate Advance may be continued as such when any Default or Event of Default has occurred and is continuing, but shall be automatically converted to a Base Rate Advance on the last day of the Interest Period relating thereto ending during the continuance of any Default or Event of Default.

 

(c)                                  In the event that Borrower does not notify the Agent of its election hereunder with respect to any LIBOR Rate Advance, such Advance shall be automatically continued at the end of the applicable Interest Period as a LIBOR Rate Advance for an Interest Period of one month unless such Interest Period shall be greater than the time remaining until the Maturity Date, in which case such Advance shall be automatically converted to Base Rate Advances at the end of the applicable Interest Period.

 

§ 4.2                     Fees.  Borrower agrees to pay to RBC and the Arrangers for their own account certain fees for services rendered or to be rendered in connection with the Loan as provided pursuant to the Agreement Regarding Fees.

 

§ 4.3                     [Intentionally Omitted]].

 

§ 4.4                     Funds for Payments.

 

(a)                                 All payments of principal, interest, closing fees and any other amounts due hereunder or under any of the other Loan Documents shall be made to the Agent, for the respective accounts of the Lenders and the Agent, as the case may be, at the Agent’s Head Office, not later than 3:00 p.m. (Eastern time) on the day when due (or such later time as is acceptable to the Agent in the event of a payment in full of all Advances and a termination of Commitments hereunder), in each case in lawful money of the United States in immediately available funds.  To the extent not already paid pursuant to the preceding sentence, the Agent is hereby authorized to charge the accounts of Borrower with RBC, on the dates when the amount thereof shall become due and payable, with the amounts of the principal of and interest on the Advances and all fees, charges, expenses and other amounts owing to the Agent and/or the Lenders under the Loan Documents.  Subject to the foregoing, all payments made to the Agent on behalf of the Lenders, and actually received by the Agent, shall be deemed received by the Lenders on the date actually received by the Agent.

 

(b)                                 All payments by Borrowerany Loan Party hereunder and under any of the other Loan Documents shall be made without setoff or counterclaim, and free and clear of and without deduction or withholding for any Taxes  now or hereafter imposed or levied by the United States of America or any political subdivision thereof or taxing or other authority therein or any jurisdiction from or through which a payment is made by Borrower, excluding any income Taxes, franchise Taxes imposed in lieu of income Taxes and any Taxes imposed by a jurisdiction as a result of any connection between a Lender and such jurisdiction other than any connection arising solely from executing, delivering, performing its obligations under, or enforcing any Loan Document (“Non-Excluded Taxes”), unless Borrower is compelled by law to make such deduction or withholding.  If any such obligation is imposed upon Borrower with respect to any amount payable by Borrower hereunder or under any of the other Loan Documents, Borrower will pay to the Agent, for the account of the Lenders or (as the case may be) the Agent, on the date on which such amount is due and payable 

 

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hereunder or under such other Loan Document, such additional amount in Dollars as shall be necessary to enable the Lenders or the Agent to receive the same net amount which the Lenders or the Agent would have received on such due date had no such obligation been imposed upon Borrower; provided, however, that Borrower shall not be required to increase any such amounts payable to any Lender with respect to any Non-Excluded Taxes (i) that are attributable to such Lender’s or Agent’s failure to comply with the requirements of § 4.4(c) or that are withholding Taxes imposed under FATCA; (ii) that are branch profits taxes imposed by the United States or any similar taxes imposed by any other jurisdiction under the laws of which a Lender is organized or in which its applicable lending office is located; or (iii) in the case of a Non-U.S. Lender, that are imposed on amounts payable to such Lender at the time such Lender becomes a party to this Agreement (or designates a new lending office), except to the extent that such Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment) to receive additional amounts from Borrower with respect to such Non-Excluded Taxes pursuant to this §4.4(b).  Borrower will deliver promptly to the Agent certificates or other valid vouchers for all Taxes or other charges deducted from or paid with respect to payments made by Borrower hereunder or under any other Loan Document. In the event a Lender receives a refund or credit of any Non-Excluded Taxes paid by Borrower pursuant to this section, such Lender will pay to Borrower the amount of such refund or credit (and any interest received with respect thereto) promptly upon receipt thereof; provided that if at any time thereafter such Lender is required to return such refund or credit, Borrower shall promptly repay to such Lender the amount of such refund or credit, net of any reasonable incremental additional costs., except as required by Legal Requirements. If any Legal Requirement (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 Legal Requirements and, if such Tax is an Indemnified Tax, then the sum payable by Borrower or other applicable Loan Party 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 §4.4) the applicable Recipient receives an amount equal to the sum it would have received had no such deduction or withholding been made.

 

(c) Each Lender that is not a United States Person (as such term is defined in Section 7701(a)(30) of the Code) for U.S. federal income tax purposes (a “Non-U.S. Lender”), to the extent such Lender is lawfully able to do so, shall provide Borrower on or prior to the Closing Date (in the case of each Lender listed on the signature pages hereof on the Closing Date) or on or prior to the date of the Assignment and Acceptance Agreement pursuant to which it becomes a Lender (in the case of each other Lender), and at such other times as may be necessary in the determination of Borrower, with (x) two (2) original copies of Internal Revenue Service Form W-8BEN, W-8BEN-E, W-8ECI and/or W-8IMY (or, in each case, any successor forms), properly completed and duly executed by such Lender, and any other such duly executed form(s) or statement(s) (including whether such Lender has complied with the FATCA) which may, from time to time, be prescribed by law and, which, pursuant to applicable provisions of (i) an income tax treaty between the United States and the country of residence of such Lender, (ii) the Code, or (iii) any applicable rules or regulations in effect under (i) or (ii) above, establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to any payments to such Lender of principal, interest, fees or other amounts payable under any of the Loan Documents, or (y) if such Lender is not a “bank” or other Person described in Section 881(c)(3) of the Code, a Certificate Regarding Non-Bank Status together with two (2) original copies of Internal Revenue Service Form W-8BEN or W-8BEN-E (or any successor form), properly completed and duly executed by such Lender, and such other documentation required under the Code and requested by Borrower to establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to any payments to such Lender of interest payable under any of the Loan Documents.  Each Lender that is a United States Person (as such term is defined in Section 7701(a)(30) of the Code) for United States federal income tax purposes (a “U.S. Lender”) and is not an exempt recipient within the meaning of Treasury Regulations Section 1.6049-4(c) shall provide Borrower on or prior to the Closing Date (or, if later, on or prior to the date on which such Lender becomes a party to this Agreement) two (2) original copies of Internal Revenue Service From W-9 (or any successor form), properly completed and duly executed by such Lender, certifying that such U.S. Lender is entitled to an exemption from United States backup withholding tax, or otherwise prove that it is 

 

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entitled to such an exemption.  Each Lender required to deliver any forms, certificates or other evidence with respect to United States federal income tax withholding matters pursuant to this Section hereby agrees, from time to time after the initial delivery by such Lender of such forms, certificates or other evidence, whenever a lapse in time or change in circumstances renders such forms, certificates or other evidence obsolete or inaccurate in any material respect, that such Lender shall promptly provide Borrower two (2) new original copies of  Internal Revenue Service Form W-9, W 8BEN, W 8ECI and/or W-8IMY (or, in each case, any successor form), or a Certificate Regarding Non-Bank Status and two (2) original copies of Internal Revenue Service Form W-8BEN or W-8BEN-E (or any successor form), as the case may be, properly completed and duly executed by such Lender, and such other documentation required under the Code and requested by Borrower to confirm or establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to payments to such Lender under the Loan Documents, or notify Borrower of its inability to deliver any such forms, certificates or other evidence.  The Agent shall deliver to Borrower (in such number of copies as shall be requested by Borrower) on or prior to the date on which the Agent becomes the Agent under this Agreement and, to the extent it remains legally entitled to do so, from time to time thereafter upon the reasonable request of Borrower, a properly completed and duly executed Internal Revenue Service Form W-9, W-8ECI and/or W-8IMY, which certifies that payments by Borrower to the Agent are exempt from U.S. withholding Tax. The Agent hereby assumes primary U.S. withholding, backup withholding and information reporting obligations with respect to amounts paid or payable to it by Borrower under the Loan Documents.

 

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

 

(c)                                  The Loan Parties shall timely pay to the relevant Governmental Authority in accordance with Legal Requirements, or at the option of the Agent timely reimburse it for the payment of, any Other Taxes.

 

(d)                                 The Loan Parties 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 §4.4) 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 Borrower by a Lender (with a copy to the Agent), or by the Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error; provided that the determinations in such statement are made on a reasonable basis and in good faith.

 

(e)                                  Each Lender shall severally indemnify the Agent, within ten (10) days after demand therefor, for (i) any Indemnified Taxes attributable to such Lender (but only to the extent that Borrower or a Guarantor has not already indemnified the Agent for such Indemnified Taxes and without limiting the obligation of Borrower and the Guarantors to do so), (ii) any Taxes attributable to such Lender’s failure to comply with the provisions of §18.4 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 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 Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the 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 Agent to the Lender from any other source against any amount due to the Agent under this subsection.

 

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(f)                                   As soon as practicable after any payment of Taxes by Borrower or any Guarantor to a Governmental Authority pursuant to this §4.4, Borrower or such Guarantor shall deliver to the 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 Agent.

 

(g)                                  (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 Borrower and the Agent, at the time or times reasonably requested by Borrower or the Agent, such properly completed and executed documentation reasonably requested by Borrower or the 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 Borrower or the Agent, shall deliver such other documentation prescribed by Legal Requirements or reasonably requested by Borrower or the Agent as will enable Borrower or the 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 the immediately following clauses (ii)(A), (ii)(B) and (ii)(D)) 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.

 

(ii)                                  Without limiting the generality of the foregoing:

 

(A)                               any Lender that is a U.S. Person shall deliver to Borrower and the 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 Borrower or the Agent), an electronic copy (or an original if requested by Borrower or the Agent) of an executed IRS Form W-9 (or any successor form) 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 Borrower and the 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 Borrower or the 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, an electronic copy (or an original if requested by the Parent Borrower or the Agent) of an executed IRS Form W-8BEN or W-8BEN-E 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 or W-8BEN-E 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)                              an electronic copy (or an original if requested by Borrower or the Agent) of an executed 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 J-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) 

 

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of the Code, a “10 percent shareholder” of 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 copies of IRS Form W-8BEN or W-8BEN-E; or

 

(IV)                          to the extent a Foreign Lender is not the beneficial owner, an electronic copy (or an original if requested by Borrower or the Agent) of an executed IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit J-2 or Exhibit J-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 J-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 Borrower and the 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 Parent Borrower or the Agent), an electronic copy (or an original if requested by Borrower or the Agent) of any other form prescribed by Legal Requirements 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 Legal Requirements to permit Borrower or the Agent to determine the withholding or deduction required to be made; and

 

(D)                               (e) Ifif a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding TaxesTax 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 Borrower and the Agent at the time or times prescribed by lawLegal Requirements and at such time or times reasonably requested by Borrower or the Agent such documentation prescribed by applicable law (Legal Requirements (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Borrower or the Agent as may be necessary for Borrower and the 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 (eD), “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 Parent Borrower and the Agent in writing of its legal inability to do so.

 

(h)                                 The Agent shall deliver to Borrower on or prior to the date on which it becomes the Agent under this Agreement (and from time to time thereafter upon the reasonable request of Borrower) an electronic copy (or an original if requested by Borrower) of an executed IRS Form W-9.

 

(i)                                     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 §4.4 (including by the payment of additional amounts pursuant to this §4.4), it shall pay to the indemnifying party an amount equal to 

 

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such refund (but only to the extent of indemnity payments made under this §4.4  with respect to the Taxes giving rise to such refund), net of all reasonable third party out-of-pocket expenses (including Taxes) of such indemnified party actually incurred 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 (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, in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this subsection 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 and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax 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 reasonably deems confidential) to the indemnifying party or any other Person.

 

(j)                                    Each party’s obligations under this §4.4 shall survive the resignation or replacement of the 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.

 

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

 

(l)                                     (f) The obligations of Borrower to the Lenders under this Agreement shall be absolute, unconditional and irrevocable, and shall be paid and performed strictly in accordance with the terms of this Agreement, under all circumstances whatsoever, including, without limitation, the following circumstances:  (i) any lack of validity or enforceability of this Agreement or any of the other Loan Documents; (ii)  the existence of any claim, set-off, defense or any right which Borrower or any of its Subsidiaries or Affiliates may have at any time against the Lenders (other than the defense of payment to the Lenders in accordance with the terms of this Agreement) or any other Person; (iii)  the surrender or impairment of any security for the performance or observance of any of the terms of any of the Loan Documents; (iv) the occurrence of any Default or Event of Default; and (v) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, provided that such other circumstances or happenings shall not have been the result of gross negligence or willful misconduct on the part of any Lender, as determined by a court of competent jurisdiction.

 

§ 4.5                     Computations.  All computations of interest on the Advances (other than Base Rate Advances at the prime rate, which shall be based on a 365/366-day year as the case may be) and of other fees to the extent applicable shall be based on a 360-day year and paid for the actual number of days elapsed.  Except as otherwise provided in the definition of the term “Interest Period” with respect to LIBOR Rate Advances, whenever a payment hereunder or under any of the other Loan Documents becomes due on a day that is not a Business Day, the due date for such payment shall be extended to the next succeeding Business Day, and interest shall accrue during such extension.  The Outstanding Advances as reflected on the records of the Agent from time to time shall be considered prima facie evidence of such amount absent manifest error.

 

§ 4.6                     Suspension of LIBOR Rate Advances.  (a)  In the event that, prior to the commencement of any Interest Period relating to any LIBOR Rate Advances, the Agent shall determine that adequate and reasonable methods do not exist for ascertaining LIBOR for such Interest Period, or the Agent shall reasonably determine (or shall receive notice from the Required Lenders that they have determined) that 

 

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LIBOR will not accurately and fairly reflect the cost of the Lenders making or maintaining LIBOR Rate Advances for such Interest Period, the Agent shall forthwith give notice of such determination (which shall be conclusive and binding on Borrower and the Lenders absent manifest error) to Borrower and the Lenders.  In such event (a, unless an alternative rate of interest is selected in accordance with clause (b) below, (i) any Loan Request with respect to a LIBOR Rate Advance shall be automatically withdrawn and shall be deemed a request

 

for a Base Rate Loan and (b) each LIBOR Rate Advance will automatically, on the last day of the then current Interest Period applicable thereto, become a Base Rate Advance, and the obligations of the Lenders to make LIBOR Rate Advances shall be suspended until the Agent determines that the circumstances giving rise to such suspension no longer exist, whereupon the Agent shall so notify Borrower and the Lenders.

 

(b)                                 If at any time the Agent determines (which determination shall be conclusive absent manifest error) that (i) the circumstances set forth in clause (a) have arisen and such circumstances are unlikely to be temporary or (ii) the circumstances set forth in clause (a) have not arisen but the supervisor for the administrator of the LIBOR Screen Rate or a Governmental Authority having jurisdiction over the Agent has made a public statement identifying a specific date after which LIBOR Screen Rate shall no longer be used for determining interest rates for loans, then the Agent and Borrower shall endeavor to establish an alternate rate of interest (which shall at no time be less than zero percent) 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 §27, such amendment shall become effective without any further action or consent of any other party to this Agreement so long as the Agent shall not have received, within five (5) Business Days of the date notice of such alternate rate of interest and a copy of such amendment is provided to the Lenders, a written notice from the Majority Lenders stating that such Majority Lenders object to such amendment.  Until an alternate rate of interest shall be determined in accordance with this clause (b) (but, in the case of the circumstances described in clause (ii) of the first sentence of this §4.6(b), only to the extent LIBOR Screen Rate for such Interest Period is not available or published at such time on a current basis), (1) any notice of conversion/continuation that requests the conversion of any Loan to, or continuation of any Loan as, a LIBOR Rate Loan shall be ineffective and any such Loan shall be converted to a Base Rate Loan on the last day of the then current Interest Period applicable thereto and (2) if any Loan Request requests a LIBOR Rate Loan, such Loan shall be made as Base Rate Loan.

 

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

 

§ 4.8                     Additional Interest.  If any LIBOR Rate Advance or any portion thereof is repaid or is converted to a Base Rate Advance for any reason on a date which is prior to the last day of the Interest Period applicable to such LIBOR Rate Advance, or if repayment of the Advances has been accelerated as provided in § 12.1, Borrower will pay to the Agent upon demand for the account of the applicable Lenders in accordance with their respective Commitment Percentages, in addition to any amounts of interest otherwise payable hereunder, the Breakage Costs.  Borrower understands, agrees and acknowledges the following:  (i) no Lender has any obligation to purchase, sell and/or match funds in connection with the use of LIBOR as a basis for calculating the rate of interest on a LIBOR Rate Advance; (ii) LIBOR is used merely as a reference in 

 

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determining such rate; and (iii) Borrower has accepted LIBOR as a reasonable and fair basis for calculating such rate and any Breakage Costs.  Borrower further agrees to pay the Breakage Costs, if any, whether or not a Lender elects to purchase, sell and/or match funds.

 

§ 4.9                     Additional Costs, Etc..  Notwithstanding anything herein to the contrary, if after the date hereof any applicable law, which expression, as used herein, includes statutes, rules and regulations thereunder and interpretations thereof by any competent court or by any governmental or other regulatory body charged with the administration or the interpretation thereof and directives and instructions at any time or from time to time hereafter made upon or otherwise issued to any Lender or the Agent by any central bank or other fiscal, monetary or other authority (whether or not having the force of law), shall:any Change in Law shall:

 

(a)                                 subject any Lender or the Agent to any tax, levy, impost, duty, charge, fee, deductionTaxes or withholding of any nature with respect to this Agreement, the other Loan Documents, such Lender’s Commitment, or the Advances (other than taxes based upon or measured by the gross receipts, income or profits of such Lender or the Agent or its franchise tax), ora Letter of Credit or the Loans (other than for Indemnified Taxes, Taxes described in clauses (b) through (d) of the definition of Excluded Taxes, and Connection Income Taxes), or

 

(b)                                 materially change the basis of taxation (except for changes in taxes on gross receipts, income or profits or its franchise tax) of payments to any Lender of the principal of or the interest on the Loan or any other amounts payable to any Lender under this Agreement or the other Loan Documents, or

 

(c)                                  impose or increase or render applicable any special deposit, reserve, assessment, liquidity, capital adequacy or other similar requirements (whether or not having the force of law and which are not already reflected in any amounts payable by Borrower hereunder) against assets held by, or deposits in or for the account of, or loans by, or commitments of an office of any Lender, or

 

(d)                                 impose on any Lender or the Agent any other conditions or requirements with respect to this Agreement, the other Loan Documents, the Loan, such Lender’s Commitment, or any class of loans or commitments of which any of the Advances or such Lender’s Commitment forms a part; and the result of any of the foregoing is:

 

(i)                                     to increase the cost to any Lender of making, funding, issuing, renewing, extending or maintaining the Loan or any portion thereof or such Lender’s Commitment, or

 

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

 

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

 

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

 

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governed by § 4.4(b) and § 4.4(c).  Without limiting the generality of the foregoing provisions of this § 4.9, any change applicable to the banking industry as a whole and lenders generally, and not solely to the Agent or a Lender, based on:  (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith 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 have occurred “after the date hereof” or “after the date of this Agreement” for purposes of this § 4.9.

 

§ 4.10              Capital Adequacy.  If after the date hereof any Lender determines that (a) the adoption of or change in any law, rule or regulation regarding capital requirements for banks or bank holding companies or any change in the interpretation or application thereof by any governmental authority charged with the administration thereofas a result of a Change in Law, or (b) compliance by such Lender or its parent bank holding company with any directive of any such entity regarding capital adequacy or liquidity, has the effect of reducing the return on such Lender’s or such holding company’s capital as a consequence of such Lender’s commitment to make Advances to a level below that which such Lender or holding company could have achieved but for such adoption, change or compliance (taking into consideration such Lender’s or such holding company’s then existing policies with respect to capital adequacy and assuming the full utilization of such entity’s capital) by any amount deemed by such Lender to be material, then such Lender may notify Borrower thereof.  Borrower agrees to pay to such Lender the amount of such reduction in the return on capital as and when such reduction is determined, upon presentation by such Lender of a statement of the amount setting forth the Lender’s calculation thereof.  In determining such amount, such Lender may use any reasonable averaging and attribution methods generally applied by such Lender.  Without limiting the generality of the foregoing provisions of this § 4.10, any change applicable to the banking industry as a whole and lenders generally, and not solely to the Agent or a Lender, based on:  (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith 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 have occurred ‘after the date hereof’ or ‘after the date of this Agreement’ for purposes of this § 4.10.

 

§ 4.11              Breakage Costs.  Borrower shall pay all Breakage Costs required to be paid by it pursuant to this Agreement and incurred from time to time by any Lender within fifteen (15) days from receipt of written notice from the Agent.

 

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

 

§ 4.13              Certificate.  A certificate setting forth any amounts payable pursuant to § 4.8, § 4.9, § 4.10, § 4.11 or § 4.12 and a reasonably detailed explanation of such amounts which are due, submitted by any Lender or the Agent to Borrower, shall be presumptively correct in the absence of manifest error.

 

§ 4.14              Limitation on Interest.  Notwithstanding anything in this Agreement or the other Loan Documents to the contrary, all agreements between or among Borrower, the Lenders and the Agent, whether now existing or hereafter arising and whether written or oral, are hereby limited so that in no

 

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contingency, whether by reason of acceleration of the maturity of any of the Obligations or otherwise, shall the interest contracted for, charged or received by the Lenders exceed the maximum amount permissible under applicable law.  If, from any circumstance whatsoever, interest would otherwise be payable to the Lenders in excess of the maximum lawful amount, the interest payable to the Lenders shall be reduced to the maximum amount permitted under applicable law; and if from any circumstance the Lenders shall ever receive anything of value deemed interest by applicable law in excess of the maximum lawful amount, an amount equal to any excessive interest shall be applied to the reduction of the principal balance of the Obligations and to the payment of interest or, if such excessive interest exceeds the unpaid balance of principal of the Obligations, such excess shall be refunded to Borrower.  All interest paid or agreed to be paid to the Lenders shall, to the extent permitted by applicable law, be amortized, prorated, allocated and spread throughout the full period until payment in full of the principal of the Obligations (including the period of any renewal or extension thereof) so that the interest thereon for such full period shall not exceed the maximum amount permitted by applicable law.  This section shall control all agreements between or among Borrower, the Lenders and the Agent.

 

§ 4.15              Certain Provisions Relating to Increased Costs and Defaulting Lenders.  If a Lender gives notice of the existence of the circumstances set forth in § 4.7 or any Lender requests compensation for any losses or costs to be reimbursed pursuant to any one or more of the provisions of § 4.4(b) (as a result of the imposition of withholding taxes on amounts paid to such Lender under this Agreement), § 4.9 or § 4.10, then, such Lender, as applicable, shall use reasonable efforts in a manner consistent with such institution’s practice in connection with loans like the Loan to eliminate, mitigate or reduce amounts that would otherwise be payable by Borrower under the foregoing provisions, provided that such action would not be otherwise materially prejudicial to such Lender, including, without limitation, by designating another of such Lender’s offices, branches or affiliates; Borrower agreeing to pay all reasonably incurred costs and expenses incurred by such Lender in connection with any such action.  Notwithstanding anything to the contrary contained herein, if no Default or Event of Default shall have occurred and be continuing, and if any Lender (a) has given notice of the existence of the circumstances set forth in § 4.7 or has requested payment or compensation for any losses or costs to be reimbursed pursuant to any one or more of the provisions of § 4.4(b) (as a result of the imposition of withholding taxes on amounts paid to such Lender under this Agreement), § 4.9 or § 4.10 and following the request of Borrower has been unable to take the steps described above to mitigate such amounts (each, an “Affected Lender”) or (b) is a Defaulting Lender, then, within thirty (30) days after such notice or request for payment or compensation or such Lender became a Defaulting Lender, as applicable, Borrower shall have the right as to such Affected Lender or Defaulting Lender, as applicable, to be exercised by delivery of written notice delivered to the Agent and the Affected Lender or Defaulting Lender, as applicable, to elect to cause the Affected Lender or Defaulting Lender, as applicable, to transfer its Commitment.  The Agent shall promptly notify the remaining Lenders that each of such Lenders shall have the right, but not the obligation, to acquire a portion of the Commitment, pro rata based upon their relevant Commitment Percentages, of the Affected Lender or Defaulting Lender, as applicable (or if any of such Lenders does not elect to purchase its pro rata share, then to such remaining Lenders in such proportion as approved by the Agent).  In the event that the Lenders do not elect to acquire all of the Affected Lender’s or Defaulting Lender’s Commitment, then the Agent shall endeavor to obtain a new Lender to acquire such remaining Commitment.  Upon any such purchase of the Commitment of the Affected Lender or Defaulting Lender, as applicable, the Affected Lender’s or Defaulting Lender’s interest in the Obligations and its rights hereunder and under the Loan Documents shall terminate at the date of purchase, and the Affected Lender or Defaulting Lender, as applicable, shall promptly execute all documents reasonably requested to surrender and transfer such interest.  The purchase price for the Affected Lender’s or Defaulting Lender’s Commitment shall equal any and all amounts outstanding and owed by Borrower to the Affected Lender or Defaulting Lender, as applicable, including principal, prepayment premium or fee, and all accrued and unpaid interest or fees.

 

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SECTION 5

 

UNENCUMBERED ASSET POOL

 

§ 5.1                     Addition of Eligible Real Estate Assets.

 

(a) As of the Closing Date, the Unencumbered Assets shall consist of the Existing Unencumbered Assets and Agent and Lenders acknowledge that the Eligible Real Estate Qualification Documents have been delivered for such Eligible Real Estate Assets.  After the Closing Date, Borrower shall have the right, subject to the satisfaction by Borrower of the conditions set forth in this § 5.1, to add Potential Unencumbered Assets to the Unencumbered Asset Pool.  Borrower from time to time after the Closing Date may also request that certain Real Estate of one or more Subsidiary GuarantorsPool Owners (collectively, the “Subsidiary Guarantor Unencumbered Assets”) be included as an Eligible Real Estate Asset for the purpose of increasing the Unencumbered Asset Pool Availability.  If Borrower shall request that any Potential Unencumbered Assets or Subsidiary Guarantor Unencumbered Asset be added to the “Revolver Unencumbered Asset Pool” or any other borrowing base or asset pool under any other Unsecured Debt, it shall be required to add such Potential Unencumbered Asset or Subsidiary Guarantor Unencumbered Asset, as applicable, to the Unencumbered Asset Pool hereunder.  In the event Borrower desires to add additional Potential Unencumbered Assets or Subsidiary Guarantor Unencumbered Assets as aforesaid, Borrower shall provide written notice to the Agent of such request (which the Agent shall promptly furnish to the Lenders), together with all documentation and other information reasonably required to permit the Agent to determine whether such Real Estate is Eligible Real Estate.  Notwithstanding the foregoing, no Subsidiary Guarantor Unencumbered Asset or Potential Unencumbered Asset shall be included in the Unencumbered Asset Pool unless and until the following conditions precedent shall have been satisfied:

 

(i)                                     such Subsidiary Guarantor Unencumbered Asset or Potential Unencumbered Asset shall be Eligible Real Estate;

 

(ii)                                  the owner of any Subsidiary Guarantor Unencumbered Asset (and any indirect owner of such Subsidiary Guarantor) shall have executed a Joinder Agreement and satisfied the conditions of § 5.3;

 

(iii)                               Borrower or the owner of the Subsidiary Guarantor Unencumbered Asset or Potential Unencumbered Asset, as applicable, shall have executed and delivered to the Agent all Eligible Real Estate Qualification Documents and a Compliance Certificate prepared using the financial statements of Borrower most recently provided or required to be provided to the Agent under § 6.4 or § 7.4; and

 

(iv)                              after giving effect to the inclusion of such Subsidiary Guarantor Unencumbered Asset or Potential Unencumbered Asset, each of the representations and warranties made by or on behalf of Loan Parties or any of their respective Subsidiaries contained in this Agreement, the other Loan Documents or in any document or instrument delivered pursuant to or in connection with this Agreement shall be true in all material respects both as of the date as of which it was made and shall also be true as of the time of the replacement or addition of Eligible Real Estate Assets, with the same effect as if made at and as of that time (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct only as of such specified date), and no Default or Event of Default shall have occurred and be continuing, and the Agent shall have received a certificate of Borrower to such effect.

 

Notwithstanding the foregoing, in the event such Subsidiary Guarantor Unencumbered Asset or Potential Unencumbered Asset does not qualify as Eligible Real Estate, so long as the conditions set forth in clauses (ii), (iii) and (iv) of this § 5.1 have been satisfied, such Subsidiary Guarantor Unencumbered Asset or Potential Unencumbered Asset shall be included in the Unencumbered Asset Pool and shall be deemed

 

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Eligible Real Estate so long as the Agent shall have received the prior written consent of each of the Lenders to the inclusion of such Real Estate as an Eligible Real Estate Asset.

 

(b) [Reserved].

 

§ 5.2                     Release of Eligible Real Estate Assets.  Provided no Default or Event of Default shall have occurred hereunder and be continuing (or would exist immediately after giving effect to the transactions contemplated by this § 5.2), and if the conditions set forth in this § 5.2 are not met, upon reasonable approval by the Required Lenders, the Agent shall release an Eligible Real Estate Asset from the Unencumbered Asset Pool upon the request of Borrower subject to and upon the following terms and conditions:

 

(a)                                 Borrower shall deliver to the Agent written notice of its desire to obtain such release no later than ten (10) days prior to the date on which such release is to be effected;

 

(b)                                 Borrower shall submit to the Agent with such request a Compliance Certificate prepared using the financial statements of Borrower most recently provided or required to be provided to the Agent under § 6.4 or § 7.4 adjusted in the best good faith estimate of Borrower to give effect to the proposed release and demonstrating that no Default or Event of Default with respect to the covenants referred to therein shall exist after giving effect to such release;

 

(c)                                  Borrower shall pay all reasonable costs and expenses of the Agent, if any, in connection with such release, including without limitation, reasonable attorney’s fees;

 

(d)                                 Borrower shall pay to the Agent for the account of the Lenders a release price, which payment shall be applied to reduce the outstanding principal balance of the Loan as provided in § 3.4, in an amount equal to the amount necessary, if any, to reduce the outstanding principal balance of the Loan so that no violation of the covenant set forth in § 9.1 shall occur;

 

(e)                                  without limiting or affecting any other provision hereof, any release of an Eligible Real Estate Asset will not cause Borrower to be in violation of the covenants set forth in § 9.8; and

 

(f)                                   such Eligible Real Estate Asset has been (or, contemporaneous with the release under this Agreement, will be) released from the Revolver Unencumbered Asset Pool or any other borrowing base or asset pool under any other Unsecured Debt.

 

§ 5.3                     Additional Subsidiary Guarantors.  InSubject to §5.4(b), in the event that Real Estate of a Subsidiary of Borrower is included in the Unencumbered Asset Pool in accordance with the terms hereof, Borrower shall cause each such Subsidiary (and any entity having an interest in such Subsidiary of Borrower) to execute and deliver to the Agent a Joinder Agreement, and such Subsidiary (and any such entity) shall become a Subsidiary Guarantor under the Guaranty.  For the avoidance of doubt, any Subsidiary or other such entity which becomes an obligor pursuant to the Existing Credit Agreement or any agreement evidencing other Unsecured Debt shall become a Subsidiary Guarantor under the Guaranty.  Each such Subsidiary shall be specifically authorized, in accordance with its respective organizational documents, to be a Guarantor under the Guaranty.  Borrower shall further cause all representations, covenants and agreements in the Loan Documents with respect to Guarantors to be true and correct with respect to each such Subsidiary.  In connection with the delivery of such Joinder Agreement, Borrower shall deliver to the Agent such organizational agreements, resolutions, consents, opinions and other documents and instruments as the Agent may reasonably require.

 

§ 5.4                     Release of Certain Subsidiary Guarantors.  (a)  In the event that all Eligible Real Estate Assets owned by a Subsidiary Guarantor shall have been released from the Unencumbered Asset Pool in

 

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accordance with the terms of this Agreement and from the Revolver Unencumbered Asset Pool or any other borrowing base or asset pool under any other Unsecured Debt, as applicable, in accordance with the terms of the Existing Credit Agreement or any agreement evidencing other Unsecured Debt, as applicable, then such Subsidiary Guarantor shall be released by the Agent from liability under the Guaranty.

 

(b)                                 Upon the occurrence of the Investment Grade Pricing Date, and provided that no Default or Event of Default exists, the Agent shall promptly release any Subsidiary Guarantor from the Guaranty upon receipt by the Agent of a certificate from an officer of Borrower certifying that such Subsidiary Guarantor has not created, incurred, acquired, assumed, suffered to exist and is not otherwise liable (whether as a borrower, co-borrower, guarantor or otherwise) with respect to any Indebtedness that is Secured Recourse Indebtedness or Consolidated Unsecured Debt (or simultaneously with the release hereunder will be released from liability with respect to such Indebtedness).  In the event that at any time after a Subsidiary Guarantor has been released from  the Guaranty or from its obligation to become a Subsidiary Guarantor pursuant to this §5.4, such Subsidiary Guarantor becomes obligated on any Indebtedness (other than ordinary course operating Indebtedness of such Subsidiary Guarantor that is otherwise permitted under the terms hereof) or Borrower ceases to have an Investment Grade Rating, such Subsidiary Guarantor shall be reinstated and Borrower shall, within ten (10) Business Days (or such later date as agreed by the Agent) after such occurrence, cause such Subsidiary Guarantor required to become a Subsidiary Guarantor under §5.3 of this Agreement to execute and deliver the documents required in said §5.3.  Notwithstanding the foregoing, the foregoing provisions shall not apply to REIT, which may only be released upon the written approval of the Agent and all of the Lenders.

 

SECTION 6

 

REPRESENTATIONS AND WARRANTIES

 

Borrower represents and warrants to the Agent and the Lenders as follows, each as of the Closing Date hereof, and as of the date of a request for a funding of any Advance hereunder.

 

§ 6.1                     Corporate Authority, Etc.

 

(a)                                 Incorporation; Good Standing.  Borrower is a Delaware limited partnership duly organized pursuant to its articles of organization or formation filed with the Delaware Secretary of State, and is validly existing and in good standing under the laws of Delaware.  Borrower (i) has all requisite power to own its property and conduct its business as now conducted and as presently contemplated, and (ii) is in good standing and is duly authorized to do business in the jurisdictions where the Eligible Real Estate Assets owned or leased by it are located and in each other jurisdiction where a failure to be so qualified in such other jurisdiction could have a Material Adverse Effect.

 

(b)                                 Subsidiaries.  Each of the Subsidiary GuarantorsLoan Parties and each of the Subsidiaries of Loan Parties (i) is a corporation, limited partnership, general partnership, limited liability company or trust duly organized under the laws of its State of organization and is validly existing and in good standing under the laws thereof, (ii) has all requisite power to own its property and conduct its business as now conducted and as presently contemplated and (iii) is in good standing and is duly authorized to do business in each jurisdiction where an Eligible Real Estate Asset owned or leased by it is located (to the extent required by applicable law) and in each other jurisdiction where a failure to be so qualified could have a Material Adverse Effect.

 

(c)                                  Authorization.  The execution, delivery and performance of this Agreement and the other Loan Documents to which any Loan Party is a party and the transactions contemplated hereby and thereby (i) are within the authority of such Loan Party, (ii) have been duly authorized by all necessary proceedings on the part of such Loan Party, (iii) do not and will not conflict with or result in any breach or contravention of any provision of law, statute, rule or regulation to which such Loan Party is subject or any judgment, order, writ, injunction, license or permit applicable to such Loan Party, except as would not

 

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reasonably be expected to result in a Material Adverse Effect, (iv) do not and will not conflict with or constitute a default (whether with the passage of time or the giving of notice, or both) under any provision of the partnership agreement, articles of incorporation or other charter documents or bylaws of, or any material agreement or other material instrument binding upon, such Loan PartyBorrower, any Subsidiary Guarantor or any of itstheir properties, (v) do not and will not result in or require the imposition of any lien or other encumbrance on any of the properties, assets or rights of such Loanany Transaction Party other than the liens and encumbrances in favor of the Agent contemplated by this Agreement and the other Loan Documents, and (vi) do not require the approval or consent of any Person other than those already obtained and delivered to the Agent or except as would not reasonably be expected to result in a Material Adverse Effect.

 

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

 

(e)                                  Foreign Assets Control.  ToNone of Borrower, any Subsidiary Guarantor or, to the knowledge of Borrower, none of Borrower, any Subsidiary Guarantor or any Affiliate of Borrower:  (i) is a Sanctioned Person, or (ii) has any of its asserts in Sanctioned Entities, or (iii) derives any of its operating income from investments in, or transactions with, Sanctioned Persons or Sanctioned Entities.  To the knowledge of Borrower,.  Borrower, the Subsidiary Guarantors and, to the knowledge of Borrower, their respective officers, employees, directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects.  No Loan, use of the proceeds of any Loan, or other transactions contemplated hereby will violate Anti-Corruption Laws or applicable Sanctions.  Neither the making of the Loans nor the use of the proceeds thereof will violate the Patriot Act, the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 C.F.R., Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto or successor statute thereto.  Borrower and its Subsidiaries are in compliance in all material respects with the Patriot Act.

 

§ 6.2                     Governmental Approvals.  The execution, delivery and performance of this Agreement and the other Loan Documents to which any LoanTransaction Party is a party and the transactions contemplated hereby and thereby do not require the approval or consent of, or filing or registration with, or the giving of any notice to, any court, department, board, governmental agency or authority other than those already obtained, in each case, except as would not reasonably be expected to result in a Material Adverse Effect.

 

§ 6.3                     Title to Eligible Real Estate Assets.  Except as indicated on Schedule 6.3 hereto or other adjustments that are not material in amount, Subsidiary GuarantorsPool Owners directly or indirectly own or lease the Eligible Real Estate Assets subject to no rights of others, including any mortgages, leases pursuant to which Subsidiary GuarantorsPool Owners or any of their Affiliates is the lessee, conditional sales agreements, title retention agreements, liens or other encumbrances except Permitted Liens.

 

§ 6.4                     Financial Statements.  REIT has furnished to the Agent:  (a) the consolidated balance sheet of REIT and its Subsidiaries as of the Balance Sheet Date and the related consolidated statement of income and cash flow for the most recent period then ended (and available) certified by an Authorized Officer or the chief financial or accounting officer of REIT, (b) as of the Closing Date, an audited statement of Net Operating Income for each of the Eligible Real Estate Assets for the period ending December 31, 2016the Balance Sheet Date certified by the chief financial or accounting officer of Borrower as fairly presenting the Net Operating Income for such parcels for such periods, and (c) certain other financial information relating to Loan Parties and the Real Estate (including, without limitation, the Eligible Real Estate Assets).  Such balance sheet and statements have been prepared in accordance with generally accepted accounting principles and fairly present the consolidated financial condition of REIT and its Subsidiaries as of such dates and the consolidated results of the operations of REIT and its Subsidiaries for such periods.  The Agent and Lenders

 

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hereby acknowledge and agree that REIT’s most recent Form 10-Q will be utilized for purposes of preparation of the Compliance Certificate as of the Closing Date.

 

§ 6.5                     No Material Changes.  Since the Balance Sheet Date or the date of the most recent financial statements delivered pursuant to § 7.4, as applicable, there has occurred no materially adverse change in the financial condition, or business of Loan Parties, and their respective Subsidiaries taken as a whole as shown on or reflected in the consolidated balance sheet of REIT as of the Balance Sheet Date, or its consolidated statement of income or cash flows for the calendar year then ended, other than changes that have not and could not reasonably be expected to have a Material Adverse Effect.  As of the date hereof, except as set forth on Schedule 6.5 hereto, there has occurred no materially adverse change in the financial condition, prospects, operations or business activities of any of the Eligible Real Estate Assets from the condition shown on the statements of income delivered to the Agent pursuant to § 6.4 other than changes in the ordinary course of business that have not had any materially adverse effect either individually or in the aggregate on the business operation or financial condition of such Eligible Real Estate Asset.

 

§ 6.6                     Franchises, Patents, Copyrights, Etc..  Except as could not reasonably be expected to have a Material Adverse Effect, Loan Parties and their respective Subsidiaries possess all franchises, patents, copyrights, trademarks, trade names, service marks, licenses and permits, and rights in respect of the foregoing, adequate for the conduct of their business substantially as now conducted without known conflict with any rights of others.

 

§ 6.7                     Litigation.  Except as stated on Schedule 6.7, there are no actions, suits, proceedings or investigations of any kind pending against any LoanTransaction Party or any of their respective Subsidiaries before any court, tribunal, arbitrator, mediator or administrative agency or board which question the validity of this Agreement or any of the other Loan Documents, any action taken or to be taken pursuant hereto or thereto or any lien, security title or security interest created or intended to be created pursuant hereto or thereto, or which could reasonably be expected to have a Material Adverse Effect.  Except as set forth on Schedule 6.7, there are no judgments, final orders or awards outstanding against or affecting any LoanTransaction Party, any of their respective Subsidiaries or any Eligible Real Estate Asset individually or in the aggregate in excess of $1,000,000.

 

§ 6.8                     No Material Adverse Contracts, Etc..  No Loan PartiesTransaction Party nor any of their respective Subsidiaries is subject to any charter, corporate or other legal restriction, or any judgment, decree, order, rule or regulation that has or is expected in the future to have a Material Adverse Effect.  No LoanTransaction Party nor any of their respective Subsidiaries is a party to any contract or agreement that has or could reasonably be expected to have a Material Adverse Effect.

 

§ 6.9                     Compliance with Other Instruments, Laws, Etc..  No LoanTransaction Party nor any of their respective Subsidiaries is in violation of any provision of its charter or other organizational documents, bylaws, or any agreement or instrument to which it is subject or by which it or any of its properties is bound or any decree, order, judgment, statute, license, rule or regulation, in any of the foregoing cases in a manner that has had or could reasonably be expected to have a Material Adverse Effect.

 

§ 6.10              Tax Status.  Except as would not reasonably be expected to result in a Material Adverse Effect, each LoanTransaction Party and its respective Subsidiaries (a) has made or filed all federal and state income and all other Tax returns, reports and declarations required by any jurisdiction to which it is subject or has obtained an extension for filing, (b) has paid prior to delinquency all Taxes and other governmental assessments and charges shown or determined to be due on such returns, reports and declarations, except those being contested in good faith and by appropriate proceedings or for which any LoanTransaction Party or their respective Subsidiaries, as applicable, has set aside on its books provisions reasonably adequate for the payment of such Taxes, and (c) has made provisions reasonably adequate for the payment of all accrued Taxes not yet due and payable.  Except as would not reasonably be expected to result in a Material Adverse Effect, there are no unpaid Taxes claimed by the taxing authority of any jurisdiction to be

 

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due by LoanTransaction Parties or their respective Subsidiaries, the officers or partners of such Person know of no basis for any such claim, and there are no audits pending or to the knowledge of LoanTransaction Parties threatened with respect to any Tax returns filed by LoanTransaction Parties or their respective Subsidiaries.  The taxpayer identification number for Borrower is 90-0587133.

 

§ 6.11              No Event of Default.  No Default or Event of Default has occurred and is continuing.

 

§ 6.12              Investment Company Act; EEA Financial Institution.  No LoanTransaction Party nor any of their respective Subsidiaries is an “investment company”, or an “affiliated company” or a “principal underwriter” of an “investment company”, as such terms are defined in the Investment Company Act of 1940.  No Transaction Party is an EEA Financial Institution.

 

§ 6.13              Absence of UCC Financing Statements, Etc..  Except with respect to Permitted Liens or as disclosed on the lien search reports delivered to and approved by the Agent, to the best of Borrower’s knowledge, there is no financing statement (but excluding any financing statements that may be filed against any LoanTransaction Party without the consent or agreement of such Persons), security agreement, chattel mortgage, real estate mortgage or other document filed or recorded with any applicable filing records, registry, or other public office, that purports to cover, affect or give notice of any present or possible future lien on, or security interest or security title in, any property of any LoanTransaction Party or rights thereunder.

 

§ 6.14              Setoff, Etc..  The Unencumbered Asset Pool is not subject to any setoff, claims, withholdings or other defenses by any LoanTransaction Party or any of its Subsidiaries or Affiliates or, to the best knowledge of Borrower, any other Person other than Permitted Liens.

 

§ 6.15              Certain Transactions.  Except as disclosed on Schedule 6.15 hereto, none of the partners, officers, trustees, managers, members, directors, or employees of any LoanTransaction Party is, nor shall any such Person become, a party to any transaction with any LoanTransaction Party (other than for services as partners, managers, members, employees, officers and directors), including any agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any partner, officer, trustee, director or such employee or, to the knowledge of Borrower, any corporation, partnership, trust or other entity in which any partner, officer, trustee, director, or any such employee has a substantial interest or is an officer, director, trustee or partner, which are on terms less favorable to LoanTransaction Parties than those that would be obtained in a comparable arms-length transaction.

 

§ 6.16              Employee Benefit Plans.  Except as would not reasonably be expected to have a Material Adverse Effect, each LoanTransaction Party and each ERISA Affiliate has fulfilled its obligation, if any, under the minimum funding standards of ERISA and the Code with respect to each Employee Benefit Plan, Multiemployer Plan or Guaranteed Pension Plan and is in compliance in all material respects with the presently applicable provisions of ERISA and the Code with respect to each Employee Benefit Plan, Multiemployer Plan or Guaranteed Pension Plan.  Except as would not reasonably be expected to have a Material Adverse Effect, neither any Loan Party nor any ERISA Affiliate has (a) sought a waiver of the minimum funding standard under § 412 of the Code in respect of any Multiemployer Plan or Guaranteed Pension Plan or (b) incurred any liability under Title IV of ERISA other than a liability to the PBGC for premiums under Section 4007 of ERISA.  Neither any LoanTransaction Party nor any ERISA Affiliate has failed to make any contribution or payment to any Multiemployer Plan or Guaranteed Pension Plan, or made any amendment to any Multiemployer Plan or Guaranteed Pension Plan, which has resulted or would reasonably be expected to result in the imposition of a Lien.  To the knowledge of Borrower, none of the Eligible Real Estate Assets constitutes a “plan asset” of any Employee Benefit Plan, Multiemployer Plan or Guaranteed Pension Plan.

 

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§ 6.17              Disclosure.  All of the representations and warranties made by or on behalf of Loan Parties in this Agreement and the other Loan Documents or any document or instrument delivered to the Agent or the Lenders pursuant to or in connection with any of such Loan Documents are true and correct in all material respects.  All information contained in this Agreement, the other Loan Documents or otherwise furnished to or made available to the Agent or the Lenders by or on behalf of any Loan Party is and will be true and correct in all material respects and does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein not materially misleading when taken as a whole.  The written information, reports and other papers and data with respect to LoanTransaction Parties, any Subsidiary or the Eligible Real Estate Assets (other than projections and estimates) furnished to the Agent or the Lenders in connection with this Agreement or the obtaining of the Commitments of the Lenders hereunder was, at the time so furnished, correct in all material respects, or has been subsequently supplemented by other written information, reports or other papers or data, to the extent necessary to give in all material respects a true and accurate knowledge of the subject matter in all material respects; provided that such representation shall not apply to (a) the accuracy of any appraisal, title commitment, survey, or engineering and environmental reports prepared by third parties or legal conclusions or analysis provided by Borrower’s counsel (although Borrower has no reason to believe that the Agent and the Lenders may not rely on the accuracy thereof) or (b) budgets, projections and other forward-looking speculative information prepared in good faith by Loan Parties (except to the extent the related assumptions were when made manifestly unreasonable).

 

§ 6.18              Trade Name; Place of Business.  No Loan Party uses any trade name and conducts business under any name other than its actual name set forth in the Loan Documents or “CoreSite(s)”.  The principal place of business of Loan Parties is 1001 17th Street, Suite 500, Denver, Colorado, 80202.

 

§ 6.19              Regulations T, U and X.  No portion of the Loan is to be used for the purpose of purchasing or carrying any “margin security” or “margin stock” as such terms are used in Regulations T, U and X of the Board of Governors of the Federal Reserve System, 12 C.F.R. Parts 220, 221 and 224.  No LoanTransaction Party is engaged, nor will it engage, principally or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any “margin security” or “margin stock” as such terms are used in Regulations T, U and X of the Board of Governors of the Federal Reserve System, 12 C.F.R. Parts 220, 221 and 224.

 

§ 6.20              Environmental Compliance.  Except as set forth on Schedules 6.20(d) or as specifically set forth in any written environmental site assessment reports provided to the Agent on or before the date hereof, or in the case of Eligible Real Estate Asset acquired after the date hereof, the environmental site assessment reports with respect thereto provided to the Agent, if any, makes the following representations and warranties:

 

(a)                                 No Loan Party, none of their respective Subsidiaries, nor to the knowledge and belief of Borrower, any operator of the Real Estate, nor any tenant or operations thereon, is in violation, or alleged violation, of any Environmental Law, which violation could reasonably be expected to have a Material Adverse Effect.

 

(b)                                 No Loan Party nor any of their respective Subsidiaries has received notice from any third party including, without limitation, any federal, state or local governmental authority, (i) that it has been identified by the United States Environmental Protection Agency (“EPA”) as a potentially responsible party under CERCLA with respect to a site listed on the National Priorities List, 40 C.F.R. Part 300 Appendix B (1986); (ii) that any Hazardous Substance(s) which it has generated, transported or disposed of have been found at any site at which a federal, state or local agency or other third party has conducted, or has demanded that any Loan Party or any of their respective Subsidiaries conduct, a remedial investigation, removal or other response action pursuant to any Environmental Law; or (iii) that it is or shall be a named party to any claim, action, cause of action, complaint, or legal or administrative proceeding (in each case, contingent or otherwise) arising

 

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out of any third party’s incurrence of costs, expenses, losses or damages of any kind whatsoever in connection with the release of Hazardous Substances, which in the case of clauses (i) through (iii) above could reasonably be expected to have a Material Adverse Effect.

 

(c)                                  To the knowledge of Borrower, (i) no portion of the Real Estate is used for the handling, processing, storage or disposal of Hazardous Substances except in compliance with applicable Environmental Laws, and no underground tank or other underground storage receptacle for Hazardous Substances is located on any portion of the Real Estate except those which are being operated and maintained in compliance with Environmental Laws; (ii) in the course of any activities conducted by Loan Parties, their respective Subsidiaries or, the tenants and operators of their properties, no Hazardous Substances have been generated or are being used on the Real Estate except in the ordinary course of LoanTransaction Parties’ or their tenants’ and operators’ business and in compliance with applicable Environmental Laws; (iii) there has been no past or present releasing, spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, disposing or dumping (other than in reasonable quantities to the extent necessary in the ordinary course of operation of LoanTransaction Parties’, their tenants’ or operators’ business and, in any event, in compliance with all Environmental Laws) (a “Release”) or threatened Release of Hazardous Substances on, upon, into or from the Eligible Real Estate Assets, which Release would have a material adverse effect on the value of such Real Estate or could reasonably be expected to have a Material Adverse Effect; (iv) there have been no Releases on, upon, from or into any real property in the vicinity of any of the Real Estate which, through soil or groundwater contamination, may have come to be located on, and which could be reasonably anticipated to have a Material Adverse Effect; and (v) any Hazardous Substances that have been generated on any of the Real Estate have been transported off site in accordance with all applicable Environmental Laws and in a manner that could not reasonably be expected to have a Material Adverse Effect.

 

(d)                                 Except as set forth on Schedule 6.20(d) or for such matters that shall be complied with as of the Closing Date, by virtue of the transactions set forth herein and contemplated hereby, or to the effectiveness of any other transactions contemplated hereby, none of Loan Parties, their respective Subsidiaries nor the Real Estate will become subject to any applicable Environmental Law requiring the performance of environmental site assessments, or the removal or remediation of Hazardous Substances, or the giving of notice to any governmental agency or the recording or delivery to other Persons of an environmental disclosure document or statement pursuant to applicable Environmental Laws.

 

(e)                                  There are no existing or closed sanitary or solid waste landfills, or hazardous waste treatment, storage or disposal facilities on or, to Borrower’s actual knowledge, affecting the Real Estate except where such existence could not reasonably be expected to have a Material Adverse Effect.

 

(f)                                   No LoanTransaction Party has received any written notice from any party that any use, operation, or condition of LoanTransaction Parties’ business on any Real Estate has caused any adverse condition on any other property that could reasonably be expected to result in a claim under applicable Environmental Law that would have a Material Adverse Effect, nor does any LoanTransaction Party have actual knowledge of any existing facts or circumstances that could reasonably be expected to form the basis for such a claim.

 

§ 6.21              Subsidiaries; Organizational Structure.  Schedule 6.21(a) sets forth, as of the date hereof and after giving effect to the reorganization previously disclosed to the Agent, all of the Subsidiaries of Borrower, the form and jurisdiction of organization of each of the Subsidiaries, and the owners of the direct and indirect ownership interests therein.  Schedule 6.21(b) sets forth, as of the date hereof, all of the Unconsolidated Subsidiaries of Borrower and its Subsidiaries, the form and jurisdiction of organization of each of the Unconsolidated Subsidiaries, Borrower’s or its Subsidiary’s ownership interest therein and the other

 

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owners of the applicable Unconsolidated Subsidiary.  No Person owns any legal, equitable or beneficial interest in any of the Persons set forth on Schedules 6.21(a) and 6.21(b) except as set forth on such Schedules.

 

§ 6.22              Leases.  LoanTransaction Parties have delivered to the Agent true and complete copies of the Leases and any amendments thereto relating to each Eligible Real Estate Asset required to be delivered as a part of the Eligible Real Estate Qualification Documents as of the date hereof.  An accurate and complete Rent Roll in all material respects as of the date of inclusion of each Eligible Real Estate Asset in the Unencumbered Asset Pool with respect to all Leases of any portion of the Eligible Real Estate Asset has been provided to the Agent.  The Leases previously delivered to the Agent as described in the preceding sentence constitute as of the date thereof the sole agreements relating to leasing or licensing of space at such Eligible Real Estate Asset and in the Building relating thereto.  No tenant under any Lease is entitled to any free rent, partial rent, rebate of rent payments, credit, offset or deduction in rent, including, without limitation, lease support payments or lease buy-outs, except as reflected in such Leases or such Rent Roll.  Except as set forth in Schedule 6.22, the Leases reflected therein are, as of the date of inclusion of the applicable Eligible Real Estate Asset in the Unencumbered Asset Pool, in full force and effect in accordance with their respective terms, without any payment default or any other material default thereunder, nor are there any defenses, counterclaims, offsets, concessions or rebates available to any tenant thereunder, and except as reflected in Schedule 6.22, no LoanTransaction Party has given or made, any notice of any payment or other material default, or any claim, which remains uncured or unsatisfied, with respect to any of the Leases, and to the best of the knowledge and belief of Borrower, there is no basis for any such claim or notice of default by any tenant which would result in a Material Adverse Effect.  Borrower knows of no condition which with the giving of notice or the passage of time or both would constitute a default on the part of (i) any tenant with respect to the material terms under a Lease or (ii) the respective LoanTransaction Party as landlord under the Lease, in either case, that would, in the aggregate with any other defaults under Leases for the applicable Eligible Real Estate Asset, adversely affect more than five percent (5%) of the base rent generated by such Eligible Real Estate Asset.  No security deposit or advance rental or fee payment has been made by any lessee or licensor under the Leases except as may be specifically designated in the Leases.  No property other than the Eligible Real Estate Asset which is the subject of the applicable Lease is necessary to comply with the material requirements (including, without limitation, parking requirements) contained in such Lease.

 

§ 6.23              Property.  To the best of Borrower’s knowledge, all of the Eligible Real Estate Assets, and all major building systems located thereon, are structurally sound, in good condition and working order and free from material defects, subject to ordinary wear and tear, except for such portion of such Real Estate which is not occupied by any tenant and which may not be in final working order pending final build-out of such space or except as where such defects have not had and could not reasonably be expected to have a Material Adverse Effect.  All of the other Real Estate of LoanTransaction Parties and their respective Subsidiaries is structurally sound, in good condition and working order, subject to ordinary wear and tear, except for such portion of such Real Estate which is not occupied by any tenant or where such defects have not had and could not reasonably be expected to have a Material Adverse Effect.  Each of the Eligible Real Estate Assets, and the use and operation thereof, is in material compliance with all applicable federal and state law and governmental regulations and any local ordinances, orders or regulations, including, without limitation, laws, regulations and ordinances relating to zoning, building codes, subdivision, fire protection, health, safety, handicapped access, historic preservation and protection, wetlands, tidelands, and Environmental Laws except in cases that would not reasonably cause a Material Adverse Effect.  All water, sewer, electric, gas, telephone and other utilities necessary for the use and operation of the Eligible Real Estate Asset are installed to the property lines of the Eligible Real Estate Asset through dedicated public rights of way or through perpetual private easements and, except in the case of drainage facilities, are connected to the Building located thereon with valid permits and are adequate to service the Building in material compliance with applicable law.  The streets abutting the Eligible Real Estate Asset are dedicated and accepted public roads, to which the Eligible Real Estate Asset has direct access or are perpetual private ways (with direct access to public roads) to which the Eligible Real Estate Asset has direct access.  There are no unpaid or outstanding real estate or other taxes or assessments on or against any of the Eligible Real Estate Assets which are payable by any LoanTransaction Party (except only real estate or other taxes or assessments, that are not yet delinquent or are being protested as

 

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permitted by this Agreement).  Each Eligible Real Estate Asset owned by a LoanTransaction Party in fee is separately assessed for purposes of real estate tax assessment and payment.  There are no unpaid or outstanding real estate or other taxes or assessments on or against any other property of LoanTransaction Parties or any of their respective Subsidiaries which are payable by any of such Persons in any material amount (except only real estate or other taxes or assessments, that are not yet delinquent or are being protested as permitted by this Agreement).  There are no pending, or to the knowledge of Borrower threatened or contemplated, eminent domain proceedings against any of the Eligible Real Estate Assets.  None of the Eligible Real Estate Assets is now damaged in any material respects as a result of any fire, explosion, accident, flood or other casualty.  No LoanTransaction Party has received any outstanding notice from any insurer or its agent requiring performance of any material work with respect to any of the Eligible Real Estate Assets or canceling or threatening to cancel any policy of insurance, and each of the Eligible Real Estate Assets complies with the material requirements of all of LoanTransaction Parties’ insurance carriers.  Except as listed on Schedule 6.23, LoanTransaction Parties have no Management Agreements for any of the Eligible Real Estate Assets.  No person or entity has any right or option to acquire any Eligible Real Estate Asset or any Building thereon or any portion thereof or interest therein, except for certain tenants pursuant to the terms of their Leases with Subsidiary GuarantorsPool Owners.

 

§ 6.24              Brokers.  No Loan Party nor any of their respective Subsidiaries has engaged or otherwise dealt with any broker, finder or similar entity in connection with this Agreement or the Loan contemplated hereunder.

 

§ 6.25              Other Debt.  No LoanTransaction Party is in default of the payment of any Indebtedness or the performance of any material obligation under any related agreement, mortgage, deed of trust, security agreement, financing agreement or indenture to which any of them is a party involving Indebtedness individually or in the aggregate in excess of (x) any Indebtedness which is recourse to Borrower or any of the Subsidiary GuarantorsPool Owners (including, without limitation, Secured Recourse Indebtedness) totaling in excess of $25,000,000 or (y) Non-Recourse Indebtedness of Borrower or any of the Subsidiary GuarantorsPool Owners totaling in excess of $50,000,000.  No LoanTransaction Party is a party to or bound by any agreement, instrument or indenture that may require the subordination in right or time or payment of any of the Obligations to any other indebtedness or obligation of any LoanTransaction Party.  Schedule 6.25 hereto sets forth all agreements, mortgages, deeds of trust, financing agreements or other material agreements binding upon LoanTransaction Parties or their respective properties and entered into by LoanTransaction Parties as of the date of this Agreement with respect to any Indebtedness of LoanTransaction Parties, and LoanTransaction Parties have provided the Agent with true, correct and complete copies thereof.

 

§ 6.26              Solvency.  As of the Closing Date and after giving effect to the transactions contemplated by this Agreement and the other Loan Documents, including all Advances made or to be made hereunder, no LoanTransaction Party is insolvent on a balance sheet basis such that the sum of such Person’s assets exceeds the sum of such Person’s liabilities, each LoanTransaction Party is able to pay its debts as they become due, and each LoanTransaction Party has sufficient capital to carry on its business.

 

§ 6.27              No Bankruptcy Filing.  No LoanTransaction Party is contemplating either the filing of a petition by it under any state or federal bankruptcy or insolvency laws or the liquidation of its assets or property, and Borrower has no knowledge of any Person contemplating the filing of any such petition against any LoanTransaction Party.

 

§ 6.28              No Fraudulent Intent.  Neither the execution and delivery of this Agreement or any of the other Loan Documents nor the performance of any actions required hereunder or thereunder is being undertaken by any Loan Party with or as a result of any actual intent by any of such Persons to hinder, delay or defraud any entity to which any of such Persons is now or will hereafter become indebted.

 

§ 6.29              Transaction in Best Interests of Loan Parties; Consideration.  The transaction evidenced by this Agreement and the other Loan Documents is in the best interests of each Loan Party. The

 

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direct and indirect benefits to inure to Loan Parties pursuant to this Agreement and the other Loan Documents constitute substantially more than “reasonably equivalent value” (as such term is used in Section 548 of the Bankruptcy Code) and “valuable consideration,” “fair value,” and “fair consideration,” (as such terms are used in any applicable state fraudulent conveyance law), in exchange for the benefits to be provided by Loan Parties pursuant to this Agreement and the other Loan Documents, and but for the willingness of each Subsidiary Guarantor to be a guarantor of the Loan, Borrower would be unable to obtain the financing contemplated hereunder which financing will enable Loan Parties to have available financing to conduct and expand their business.

 

§ 6.30              OFAC.  No Loan PartyNeither REIT, nor any of its Subsidiaries, nor, to the knowledge of Borrower, any director, officer or employee thereof, is an individual or entity that is, or is owned or controlled directly by any individual or entity that (i) is (or will be) a person with whom any Lender is restricted from doing business under OFAC (including, those Persons named on OFAC’s Specially Designated and Blocked Persons list) or under any statute, executive order (including the September 24, 2001 Executive Order Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism), or other governmental action and is not and shall not engage in any dealings or transactions or otherwise be associated  with such personsSanctioned Person, (ii) is (or will be) located, organized or resident, or has its assets located, in a Designated Jurisdiction, (iii) is (or will be) engaged in any transaction with any Sanctioned Person or any Person who is located, organized or resident in any Designated Jurisdiction to the extent that such transactions would violate Sanctions, or (iv) is violating or will be violating any Anti-Money Laundering Law in any material respect.  No Loan, nor the proceeds from any Loan, has been used, directly or knowingly indirectly, or has otherwise been made available to fund any activity or business in any Designated Jurisdiction or to fund any activity or business with any Sanctioned Person, or in any other manner that will result in a violation by any Loan Party or Subsidiary thereof, or any Lender or the Agent, of Sanctions.  Each of the Loan Parties and its Subsidiaries, and, to the knowledge of the Loan Parties, each director, officer, employee, and agent of the Loan Parties and each such Subsidiary, is in compliance with the Anti-Corruption Laws in all material respects.  The Loan Parties have implemented and maintain in effect policies and procedures reasonably designed to promote and achieve compliance with the Anti-Corruption Laws and applicable Sanctions.  In addition, BorrowerLoan Parties hereby agreesagree to provide to the Lenders any additional information that a Lender reasonably deems necessary from time to time in order to ensure compliance with all applicable laws concerning money laundering and similar activities.

 

SECTION 7

 

AFFIRMATIVE COVENANTS

 

Borrower covenants and agrees that, so long as the Loan or any Note is outstanding or any Lender has any obligation to make any Advance of the Loan:

 

§ 7.1                     Punctual Payment.  Borrower shall, and shall cause each other Loan Party to, duly and punctually pay or cause to be paid the principal and interest on the Loan and all interest and fees provided for in this Agreement, all in accordance with the terms of this Agreement and the Notes, as well as all other sums owing pursuant to the Loan Documents in accordance with the terms hereof.

 

§ 7.2                     Maintenance of Office.  Borrower shall, and shall cause each other Loan Party to, maintain its respective chief executive offices at 1001 17th Street, Suite 500, Denver, Colorado, 80202, or at such other place in the United States of America as Borrower shall designate upon prompt written notice to the Agent and the Lenders, where notices, presentations and demands to or upon Borrower in respect of the Loan Documents may be given or made.

 

§ 7.3                     Records and Accounts.  Borrower shall, and shall cause each other Loan Party to, keep, and cause each of their respective Subsidiaries to keep, true and accurate records and books of account in which full, true and correct entries will be made in accordance with GAAP (in each case, in all material

 

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respects).  Borrower shall not and shall not permit any other Loan Party to, without the prior written consent of the Agent, not to be unreasonably withheld, (x) make any material change to the accounting policies/principles used by such Person in preparing the financial statements and other information described in § 6.4 or § 7.4, or (y) change its fiscal year.  The Agent and the Lenders acknowledge that REIT’s fiscal year is a calendar year.

 

§ 7.4                     Financial Statements, Certificates and Information.  Borrower shall, and (if applicable) shall cause each other Loan Party to, deliver or cause to be delivered to the Agent with sufficient copies for each of the Lenders:

 

(a)                                 within five (5) days of the filing of REIT’s Form 10-K with the SEC, if applicable, but in any event not later than one hundred twenty (120) days after the end of each calendar year, the audited Consolidated balance sheet of REIT and its Subsidiaries at the end of such year, and the related audited consolidated statements of income, changes in capital and cash flows for such year, setting forth in comparative form the figures for the previous fiscal year and all such statements to be in reasonable detail, prepared in accordance with GAAP, together with a certification by an Authorized Officer or the chief financial officer or accounting officer of REIT that the information contained in such financial statements fairly presents in all material respects the financial position of REIT and its Subsidiaries, and accompanied by an auditor’s report prepared without qualification as to the scope of the audit by a member firm of KPMG International Cooperative or another nationally recognized accounting firm reasonably approved by the Agent;

 

(b)                                 within five (5) days of the filing of REIT’s Form 10-Q with the SEC, if applicable, but in any event not later than sixty (60) days after the end of each calendar quarter of each year, copies of the unaudited consolidated balance sheet of REIT and its Subsidiaries, as at the end of such quarter, and the related unaudited consolidated statements of income and cash flows for the portion of REIT’s fiscal year then elapsed, all in reasonable detail and prepared in accordance with GAAP, together with a certification by an Authorized Officer or the chief financial officer or accounting officer of REIT that the information contained in such financial statements fairly presents in all material respects the financial position of REIT and its Subsidiaries on the date thereof (subject to year-end adjustments);

 

(c)                                  simultaneously with the delivery of the financial statements referred to in subsections (a) and (b) above, a statement (a “Compliance Certificate”) certified by an Authorized Officer or the chief financial officer or chief accounting officer of REIT in the form of Exhibit E hereto (or in such other form as the Agent may approve from time to time) setting forth in reasonable detail computations evidencing compliance or non-compliance (as the case may be) with the covenants contained in § 9 setting forth reconciliations to reflect changes in GAAP since the Balance Sheet Date, with the Compliance Certificate for the quarter ending DecemberMarch 31, 20162018 being prepared by REIT on a good faith estimated basis.  REIT shall submit with the Compliance Certificate an Unencumbered Asset Pool Certificate in the form of Exhibit D attached hereto pursuant to which REIT shall calculate the amount of the Unencumbered Asset Pool Availability as of the end of the immediately preceding calendar quarter.  All income, expense and value associated with Real Estate or other Investments disposed of during any quarter will be eliminated from calculations, where applicable.  The Compliance Certificate shall be accompanied by copies of the statements of Net Operating Income for such calendar quarter for each of the Eligible Real Estate Assets, prepared on a basis consistent with the statements furnished to the Agent prior to the date hereof and otherwise in form and substance reasonably satisfactory to the Agent, together with a certification by an Authorized Officer or the chief financial officer or chief accounting officer of REIT that the information contained in such statement fairly presents in all material respects Net Operating Income of the Eligible Real Estate Assets for such periods;

 

(d)                                 simultaneously with the delivery of the financial statements referred to in clause (a) above, the statement of all contingent liabilities involving amounts of $10,000,000 or more

 

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of Loan Parties and their Subsidiaries which are not reflected in such financial statements or referred to in the notes thereto (including, without limitation, all guaranties, endorsements and other contingent obligations in respect of the indebtedness of others, and obligations to reimburse the issuer in respect of any letters of credit);

 

(e)                                  simultaneously with the delivery of the financial statements referred to in subsections (a) and (b) above, (i) a Rent Roll for each of the Eligible Real Estate Assets and a summary thereof in form reasonably satisfactory to the Agent as of the end of each calendar quarter (including the fourth calendar quarter in each year), together with a listing of each tenant that has taken occupancy of such Eligible Real Estate Asset during each calendar quarter (including the fourth calendar quarter in each year), and (ii) a copy of each material Lease or material amendment to any material Lease entered into with respect to an Eligible Real Estate Asset during such calendar quarter (including the fourth calendar quarter in each year);

 

(f)                                   simultaneously with the delivery of the financial statements referred to in subsections (a) and (b) above, to the extent not included in public filings by or on behalf of REIT, and upon request by the Agent, a statement (i) listing the material Real Estate owned by Loan Parties and their Subsidiaries (or in which Loan Parties or their Subsidiaries own an interest) and stating the location thereof, the date acquired and the acquisition cost, (ii) listing the Indebtedness of Loan Parties and their Subsidiaries (excluding Indebtedness of the type described in § 8.1(b)-(e)), which statement shall include, without limitation, a statement of the original principal amount of such Indebtedness and the current amount outstanding, the holder thereof, the maturity date and any extension options, the interest rate, the collateral provided for such Indebtedness and whether such Indebtedness is recourse or non-recourse, and (iii) listing the properties of Loan Parties and their Subsidiaries which are Development Properties and providing a brief summary of the status of such development;

 

(g)                                  contemporaneously with the filing or mailing thereof, copies of all material of a financial nature, reports or proxy statements sent to the owners of Borrower or REIT;

 

(h)                                 to the extent requested by the Agent, copies of all annual federal income tax returns and amendments thereto of Loan Parties;

 

(i)                                     promptly upon the filing hereof, copies of any registration statements (other than the exhibits thereto and any registration statements on Form S-8 or its equivalent) and any annual, quarterly or monthly reports and other statements and reports which Borrower or REIT shall file with the SEC;

 

(j)                                    to the extent requested by the Agent, evidence reasonably satisfactory to the Agent of the timely payment of all real estate taxes for the Eligible Real Estate Assets;

 

(k)                                 not later than January 31 of each year, a budget and business plan for Loan Parties and their Subsidiaries for such calendar year; and

 

(l)                                     from time to time such other financial data and information in the possession of Loan Parties or their respective Subsidiaries (including without limitation auditors’ management letters, status of litigation or investigations against Loan Parties and any settlement discussions relating thereto, property inspection and environmental reports and information as to zoning and other legal and regulatory changes affecting Loan Parties) as the Agent may reasonably request.

 

Any material to be delivered pursuant to this §7.4 (collectively, “Information Materials”) may be delivered electronically directly to the Agent or made available to the Agent pursuant to an accessible website and the Lenders provided that such material is in a format reasonably acceptable to the Agent, and such material shall

 

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be deemed to have been delivered to the Agent and the Lenders upon the Agent’s receipt thereof or access to the website containing such material.  The Agent shall distribute any such information to the Lenders after receipt thereof, and may do so by electronic form in the same manner as provided in this §7.4.  Upon the request of the Agent, Borrower shall, and shall cause each other Loan Party to, deliver paper copies thereof to the Agent and the Lenders.  Borrower authorizes the Agent and the Arrangers to disseminate any such materials through the use of Intralinks, SyndTrak or any other electronic information dissemination system, and Borrower releases the Agent provided that such system is secure and access thereto is protected by a password that is only disclosed to the Lenders (an “Electronic System”).  Any such Electronic System is provided “as is” and “as available.”  The Agent and each Arranger do not warrant the adequacy of any Electronic System and expressly disclaim liability for errors or omissions in any notice, demand, communication, information or other material provided by or on behalf of Borrower that is distributed over or by any such Electronic System (“Communications”).  No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third-party rights or freedom from viruses or other code defects, is made by the Agent or any Arranger in connection with the Communications or the Electronic System.  In no event shall the Agent, any Arranger or any of their directors, officers, employees, agents or attorneys have any liability to Borrower or any Guarantor, any Lender or any other Person for damages of any kind, including, without limitation, direct or indirect, special, incidental or consequential damages, losses or expenses (whether  in tort, contract or otherwise) arising out of any Loan Party’s, the Agent’s or any Arranger’s transmission of Communications through the Electronic System, and the Loan Parties release Agent, the Arrangers and the Lenders from any liability in connection therewith.

 

§ 7.5                     Notices.

 

(a)                                 Defaults.  Borrower shall, and shall cause each other Loan Party to, promptly upon becoming aware of same notify the Agent in writing of the occurrence of any Default or Event of Default, which notice shall describe such occurrence with reasonable specificity.  If any Person shall give any notice or take any other action in respect of a claimed default (whether or not constituting an Event of Default) under this Agreement or under any note, evidence of indebtedness, indenture or other obligation to which or with respect to which any Loan Party or any of their respective Subsidiaries is a party or obligor, whether as principal or surety, and such default would permit the holder of such note or obligation or other evidence of indebtedness to accelerate the maturity thereof, which acceleration would either cause a Default or have a Material Adverse Effect, Borrower shall, and shall cause each other Loan Party to, forthwith give written notice thereof to the Agent and each of the Lenders, describing the notice or action and the nature of the claimed default.

 

(b)                                 Environmental Events.  Borrower shall, and shall cause each other Loan Party to, give notice to the Agent within ten (10) Business Days of becoming aware of (i) any potential or known Release, or threat of Release, of any Hazardous Substances in violation of any applicable Environmental Law; (ii) any violation of any Environmental Law that any Loan Party or any of their respective Subsidiaries reports in writing or is reportable by such Person in writing (or for which any written report supplemental to any oral report is made) to any federal, state or local environmental agency or (iii) any inquiry, proceeding, investigation, or other action, including a notice from any agency of potential environmental liability, of any federal, state or local environmental agency or board, that in the case of either clauses (i) — (iii) above could reasonably be expected to have a Material Adverse Effect.

 

(c)                                  Notification of Claims Against the Unencumbered Asset Pool.  Borrower shall, and shall cause each other Loan Party to, give notice to the Agent in writing within five (5) Business Days of becoming aware of any material setoff, claims (including, with respect to the Eligible Real Estate Asset, environmental claims or any claims or notices of default by any Loan Party under any ground lease or Leased Asset), withholdings or other defenses to which any of the Eligible Real Estate Assets are subject, to the extent the same would result in a Material Adverse Effect.

 

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(d)                                 Notice of Litigation and Judgments.  Borrower shall, and shall cause each other Loan Party to, give notice to the Agent in writing within five (5) Business Days of becoming aware of any litigation or proceedings threatened in writing affecting any Loan Party or any of their respective Subsidiaries or to which any Loan Party or any of their respective Subsidiaries is or is to become a party involving an uninsured claim against any Loan Party or any of its respective Subsidiaries that could reasonably be expected to have a Material Adverse Effect and stating the nature and status of such litigation or proceedings.  Borrower shall, and shall cause each other Loan Party to, give notice to the Agent, in writing, in form and detail reasonably satisfactory to the Agent and each of the Lenders, within ten (10) days of any judgment not covered by insurance, whether final or otherwise, against any Loan Party or any of their respective Subsidiaries in an amount in excess of $1,000,000.

 

(e)                                  ERISA.  Borrower shall, and shall cause each other Loan Party to, give notice to the Agent within ten (10) Business Days after Loan Parties or any ERISA Affiliate (i) give or are required to give notice to the PBGC of any “reportable event” (as defined in Section 4043 of ERISA) with respect to any Guaranteed Pension Plan, Multiemployer Plan, or know that the plan administrator of any such plan has given or is required to give notice of any such reportable event; (ii) have received a notice from the trustee of a Multiemployer Plan of complete or partial withdrawal liability under Title IV of ERISA; or (iii) receive any notice from the PBGC under Title IV or ERISA of an intent to terminate or appoint a trustee to administer any such plan, in each case if such event or occurrence would reasonably be expected to have a Material Adverse Effect.

 

(f)                                   Existing Credit Agreement.  Within two (2) Business Days of any increase in the Revolving Loans or the Letter of Credit Liabilities, Borrower will give notice thereof to the Agent in writing.

 

(g)                                  Notification of Lenders.  Within five (5) Business Days after receiving any notice under this § 7.5, the Agent will forward a copy thereof to each of the Lenders, together with copies of any certificates or other written information that accompanied such notice.

 

§ 7.6                     Existence; Maintenance of Properties.

 

(a)                                 Borrower shall, and shall cause each other Loan Party to, preserve and keep in full force and effect its legal existence in the jurisdiction of its incorporation or formation.  Borrower shall, and shall cause each other Loan Party to, preserve and keep in full force all of its rights and franchises, the preservation of which is necessary to the conduct of its business.  Borrower shall cause REIT to at all times comply with all requirements and applicable laws and regulations necessary to maintain REIT Status and shall continue to receive REIT Status.  Borrower shall cause the common stock of REIT to at all times be listed for trading and be traded on the New York Stock Exchange or another national exchange approved by the Agent, unless otherwise consented to by the Required Lenders.  Borrower shall continue to own directly or indirectly one hundred percent (100%) of the Subsidiary GuarantorsPool Owners, subject to the terms and provisions hereof.

 

(b)                                 Borrower shall, and shall cause each other LoanTransaction Party to, (i) cause all of its properties used or useful in the conduct of its business or the business of its Subsidiaries to be maintained and kept in good condition, repair and working order (ordinary wear and tear excepted) and supplied with all necessary equipment, and (ii) cause to be made all necessary repairs, renewals, replacements, betterments and improvements thereof in all cases in which the failure to do so would cause a Material Adverse Effect, and (iii) diligently perform and observe in all material respects all of the terms, covenants, and conditions of any ground lease or lease related to a Leased Asset which is an Eligible Real Estate Asset.

 

§ 7.7                     Insurance.  Borrower shall, and shall cause each other LoanTransaction Party to, at its expense, procure and maintain for the benefit of Loanthe Transaction Parties, insurance policies issued by such insurance companies, in such amounts, in such form and substance, and with such coverages,

 

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endorsements, deductibles and expiration dates as are commercially reasonable, taking into consideration the property size, use, and location that a commercially prudent lender would require covering each Eligible Real Estate Asset.

 

§ 7.8                     Taxes.  Borrower shall, and shall cause each other Loan Party and their respective Subsidiaries to, duly pay and discharge, or cause to be paid and discharged, all taxes, assessments and other governmental charges imposed upon them or upon the Eligible Real Estate Assets or the other Real Estate, sales and activities, or any part thereof, or upon the income or profits therefrom that if unpaid might by law become a lien or charge upon any of its property or other Liens affecting any of the Eligible Real Estate Assets or other property of Loan Parties, or, with respect to their respective Subsidiaries that could reasonably be expected to have a Material Adverse Effect, provided that any such tax, assessment, charge or levy or claim need not be paid if the validity or amount thereof shall currently be contested in good faith by appropriate proceedings which shall suspend the collection thereof with respect to such property, neither such property nor any portion thereof or interest therein would be in any danger of sale, forfeiture or loss by reason of such proceeding and such Loan Party or any such Subsidiary shall have set aside on its books adequate reserves in accordance with GAAP; and provided, further, that forthwith upon the commencement of proceedings to foreclose any lien that may have attached as security therefor, such Loan Party or any such Subsidiary either (i) will provide a bond issued by a surety reasonably acceptable to the Agent and sufficient to stay all such proceedings or (ii) if no such bond is provided, will pay each such tax, assessment, charge or levy.

 

§ 7.9                     Inspection of Properties and Books.  Borrower shall, and shall cause each other Loan Party and their respective Subsidiaries to, permit the Agent and the Lenders, at Loan Parties’ expense and upon reasonable prior notice, to visit and inspect any of the properties of Loan Parties or any of their respective Subsidiaries (subject to the rights of tenants under their Leases, and the Agent and Lender agree to use commercially reasonable efforts not to interfere with such rights) during normal business hours, to examine the books of account of Loan Parties and their respective Subsidiaries (and to make copies thereof and extracts therefrom) and to discuss the affairs, finances and accounts of Loan Parties and their respective Subsidiaries with, and to be advised as to the same by, their respective officers, partners or members, all at such reasonable times and intervals as the Agent or any Lender may reasonably request, provided that so long as no Default or Event of Default shall have occurred and be continuing, Loan Parties shall not be required to pay for such visits and inspections more often than once in any twelve (12) month period.  The Lenders shall use good faith efforts to coordinate such visits and inspections so as to minimize the interference with and disruption to the normal business operations of Loan Parties and their respective Subsidiaries.

 

§ 7.10              Compliance with Laws, Contracts, Licenses, and Permits.  Borrower shall, and shall cause each other Loan Party and their respective Subsidiaries to, comply in all respects with (i) all applicable laws (including without limitation Anti-Corruption Laws and applicable Sanctions) and regulations now or hereafter in effect wherever its business is conducted, including all Environmental Laws, (ii) the provisions of its corporate charter, partnership agreement, limited liability company agreement or declaration of trust, as the case may be, and other charter documents and bylaws, (iii) all agreements and instruments to which it is a party or by which it or any of its properties may be bound, (iv) all applicable decrees, orders, and judgments, and (v) all licenses and permits required by applicable laws and regulations for the conduct of its business or the ownership, use or operation of its properties, except where a failure to so comply with any of clauses (i) through (v) could not reasonably be expected to have a Material Adverse Effect.  If any authorization, consent, approval, permit or license from any officer, agency or instrumentality of any government shall become necessary or required in order that Loan Parties or their respective Subsidiaries may fulfill any of its obligations hereunder, Borrower shall, and shall cause each other Loan Party or such Subsidiary to immediately take or cause to be taken all reasonable steps necessary to obtain such authorization, consent, approval, permit or license and furnish the Agent and the Lenders with evidence thereof.  Borrower shall, and shall cause each other Loan Party to, develop and implement such programs, policies and procedures as are necessary to comply with the Patriot Act and shall promptly advise the Agent in writing in the event that Loan Parties shall determine that any investors in Loan Parties are in violation of such act.

 

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§ 7.11              Further Assurances.  Borrower shall, and shall cause each other Loan Party and their respective Subsidiaries to, cooperate with the Agent and the Lenders and execute such further instruments and documents as the Lenders or the Agent shall reasonably request to carry out to their satisfaction the transactions contemplated by this Agreement and the other Loan Documents.

 

§ 7.12              Management.  Borrower shall, and shall cause each other Loan Party to, upon request provide the Agent copies of (i) any future Management Agreements entered into with respect to any additional Eligible Real Estate Asset added to the Unencumbered Asset Pool and (ii) any replacements of or material amendments to the Management Agreements provided to the Agent on or prior to the date hereof.

 

§ 7.13              Intentionally Omitted.

 

§ 7.14              Business Operations.  Borrower shall, and shall cause each other Loan Party and their respective Subsidiaries to, operate their respective businesses in substantially the same manner and in substantially the same fields and lines of business as such business is now conducted and in compliance with the terms and conditions of this Agreement and the Loan Documents.  Borrower will not, and will not permit any Loan Party or any Subsidiary to, directly or indirectly, engage in any line of business other than the ownership, operation and development of Data Center Properties or businesses incidental thereto.

 

§ 7.15              Registered Servicemark.  Without prior written notice to the Agent, none of the Eligible Real Estate Assets shall be owned or operated by Loan Parties under any registered or protected trademark, tradename, servicemark or logo (other than the “CoreSite(s)” name and the “CoreSite(s)” logo).

 

§ 7.16              Ownership of Real Estate.  Without the prior written consent of the Agent, all Eligible Real Estate Assets and all interests (whether direct or indirect) of Borrower or REIT in any real estate assets now owned or leased or acquired or leased after the date hereof shall be owned or leased directly by Borrower or a Wholly Owned Subsidiary of Borrower; provided, however that Borrower shall be permitted to own or lease interests in Real Estate through non-Wholly Owned Subsidiaries and Unconsolidated Affiliates as permitted by § 8.3(m).

 

§ 7.17              Intentionally Omitted.

 

§ 7.18              Ownership RestrictionsRestrictions.  REIT will at all times own not less than thirty three percent (33%) of the economic, voting and beneficial interest in Borrower and shall be the sole general partner of Borrower.

 

§ 7.19              Plan Assets.  Borrower shall, and shall cause each other Loan Party to, do, or cause to be done, all things necessary to ensure that none of the Eligible Real Estate Assets will be deemed to be Plan Assets at any time.

 

§ 7.20              Intentionally Omitted.

 

§ 7.21              Intentionally Omitted.

 

§ 7.22              REIT Covenants.  Borrower shall cause REIT to comply with the following covenants:

 

(a)                                 REIT will have as its sole business purpose owning ownership interests of Borrower, performing duties as the general partner of Borrower, and making equity investments in such operating partnership and doing and performing any and all acts and things in service of the foregoing (including, for the avoidance of doubt, owning ownership interests in CoreSite, L.L.C.), and shall not engage in any business or activities other than those described in this §7.22(a);

 

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(b)                                 REIT shall promptly contribute or otherwise downstream to Borrower any net assets received by REIT from third parties (including, without limitation, the proceeds from any Equity Offering);

 

(c)                                  REIT will not make or permit to be made, by voluntary or involuntary means, any transfer or encumbrance of its interest in Borrower, or any dilution of its interest in Borrower; provided, however, that the interests of REIT in Borrower may be diluted as a direct result of the acquisition by Borrower or its Subsidiaries of additional Real Estate, either by acquiring title to such Real Estate directly in the name of Borrower or any such Subsidiary or by acquiring direct or indirect ownership interests in a partnership, corporation or limited liability company that owns directly such Real Estate (subject in all respects to compliance by Borrower and its Subsidiaries with the terms of this Agreement), the sales price of which is paid in whole or in part by the issuance of additional interests in Borrower so long as REIT at all times complies with § 7.18 hereof; and provided, further, that this paragraph shall not apply to any Employee Benefit Plan of REIT or any unit redemptions of Borrower by The Carlyle Group; and

 

(d)                                 REIT shall not dissolve, liquidate or otherwise wind up its business, affairs or assets.

 

SECTION 8

 

NEGATIVE COVENANTS

 

Borrower covenants and agrees that, so long as the Loan or any Note is outstanding or any of the Lenders has any obligation to make any Advance of the Loan:

 

§ 8.1                     Restrictions on Indebtedness.  Borrower shall not, and shall not permit any other LoanTransaction Party to, create, incur, assume, guarantee or be or remain liable, contingently or otherwise, with respect to any Indebtedness other than:

 

(a)                                 Indebtedness to the Lenders arising under any of the Loan Documents;

 

(b)                                 current liabilities of LoanTransaction Parties incurred in the ordinary course of business but not incurred through (i) the borrowing of money, or (ii) the obtaining of credit except for credit on an open account basis customarily extended and in fact extended in connection with normal purchases of goods and services;

 

(c)                                  Indebtedness in respect of taxes, assessments, governmental charges or levies and claims for labor, materials and supplies to the extent that payment therefor shall not at the time be required to be made in accordance with the provisions of § 7.8;

 

(d)                                 Indebtedness in respect of judgments only to the extent, for the period and for an amount not resulting in an Event of Default;

 

(e)                                  endorsements for collection, deposit or negotiation and warranties of products or services, in each case incurred in the ordinary course of business;

 

(f)                                   Indebtedness of Borrower in connection with completion and similar guaranties in an aggregate amount at any one time not in excess of the greater of (i) $175,000,000 or (ii) fifteen percent (15%) of the Gross Asset Value;

 

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(g)           Otherother Indebtedness of Borrower, REIT or any of their Subsidiaries (other than any Subsidiary GuarantorPool Owner), provided that none of such Persons shall incur any of the Indebtedness described in this § 8.1(g) unless it shall have provided to the Agent prior written notice of the proposed incurrence of such Indebtedness, a statement that the borrowing will not cause a Default or Event of Default and a Compliance Certificate demonstrating that Loan Parties will be in compliance with the covenants referred to therein after giving effect to the incurrence of such Indebtedness;

 

(h)           Derivatives Contracts (including Approved Derivatives Contracts) reasonably acceptable to the Agent sufficient to ensure Loan Parties’ compliance with § 9.7;

 

(i)            the Revolver Loans; and

 

(j)            the Senior Notes.

 

(k) Notwithstanding anything in this Agreement to the contrary, (i) none of the Indebtedness described in §8.1(g) above shall have any of the Eligible Real Estate Assets or any interest therein or any direct or indirect ownership interest in any Subsidiary GuarantorPool Owner as collateral, a borrowing base, asset pool or any similar form of credit support for such Indebtedness (provided that the foregoing shall not preclude Subsidiaries of Borrower (other than a Subsidiary GuarantorPool Owner) from incurring Indebtedness subject to the terms of this §8.1 or recourse to the general credit of Borrower) and (ii) none of the Subsidiary GuarantorsPool Owners, Borrower or REIT shall create, incur, assume, guarantee or be or remain liable, contingently or otherwise, with respect to any Indebtedness (including, without limitation, pursuant to any conditional or limited guaranty or indemnity agreement creating liability with respect to usual and customary exclusions from the non-recourse limitations governing the Non-Recourse Indebtedness of any Person, or otherwise) other than Indebtedness described in §8.1(a)-(j) above.

 

§ 8.2       Restrictions on Liens, Etc..  Borrower shall not, and shall not permit any other LoanTransaction Party to, (a) create or incur or suffer to be created or incurred or to exist any lien, security title, encumbrance, mortgage, pledge, negative pledge (aside from any negative pledge in relation to the Existing Credit Agreement or any agreement evidencing other Unsecured Debt, as applicable) charge, restriction or other security interest of any kind upon any of their respective property or assets of any character whether now owned or hereafter acquired, or upon the income or profits therefrom; (b) transfer any of their property or assets or the income or profits therefrom for the purpose of subjecting the same to the payment of Indebtedness or performance of any other obligation in priority to payment of its general creditors; (c) suffer to exist for a period of more than thirty (30) days after the same shall have been incurred any Indebtedness or claim or demand against any of them that if unpaid could by law or upon bankruptcy or insolvency, or otherwise, be given any priority whatsoever over any of their general creditors; (d) sell, assign, pledge or otherwise transfer any accounts, contract rights, general intangibles, chattel paper or instruments, with or without recourse; or (e) incur or maintain any obligation (aside from any negative pledge in relation to the Existing Credit Agreement or any agreement evidencing other Unsecured Debt, as applicable) to any holder of Indebtedness of any of such Persons which prohibits the creation or maintenance of any lien securing the Obligations (collectively, “Liens”); provided that notwithstanding anything to the contrary contained herein, LoanTransaction Parties may create or incur or suffer to be created or incurred or to exist:

 

(i)            (A) Liens not yet due or payable on properties to secure taxes, assessments and other governmental charges (excluding any Lien imposed pursuant to any of the provisions of ERISA or pursuant to any Environmental Laws) or claims for labor, material or supplies incurred in the ordinary course of business in respect of obligations not then delinquent or not otherwise required to be paid or discharged under the terms of this Agreement or any of the other Loan Documents and (B) Liens on assets other than (I) the Unencumbered Asset Pool and (II) any direct or indirect interest of Borrower or any

 

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Subsidiary of Loan Parties in any other Loan Party in respect of judgments permitted by § 8.1(d);

 

(ii)           deposits or pledges made in connection with, or to secure payment of, workers’ compensation, unemployment insurance, old age pensions or other social security obligations or any letters of credit or Derivatives Contracts under or in connection with the Existing Credit Agreement;

 

(iii)          Liens consisting of (A) mortgage liens on Real Estate (including the rents, issues and profits therefrom), other than Real Estate that constitutes an Eligible Real Estate Asset or any interest therein (including the rents, issues and profits therefrom), securing Indebtedness which is permitted by § 8.1(g) or (B) liens consisting of pledges of security interests in the ownership interests of any Subsidiary which is not a LoanTransaction Party or the direct or indirect owner of an interest in a LoanTransaction Party securing Indebtedness which is permitted by § 8.1(g);

 

(iv)          encumbrances on any Eligible Real Estate Asset consisting of easements, rights of way, zoning restrictions, restrictions on the use of real property and defects and irregularities in the title thereto, landlord’s or lessor’s liens under leases to which a LoanTransaction Party is a party, purchase money security interests and other liens or encumbrances, which do not individually or in the aggregate have a Material Adverse Effect;

 

(v)           the rights of tenants or subtenants under Leases in the ordinary course of business;

 

(vi)          any option, contract or other agreement to sell an asset provided such sale is otherwise permitted by this Agreement;

 

(vii)         with respect to any Leased Asset, any (x) reversionary interest or title of lessor or sublessor under the applicable Lease or (y) Lien, easement, restriction or encumbrance to which the interest or title of such lessor or sublessor may be subject; and

 

(viii)        Liens in favor of the Agent and the Lenders under the Loan Documents to secure the Obligations.

 

Notwithstanding anything in this Agreement to the contrary, (x) no Loan PartyPool Owner shall create or incur or suffer to be created or incurred or to exist any Lien other than Liens contemplated in §§ 8.2(i), (iv), (v), (vi), (vii) and (viii) and (y) REIT shall not create or suffer to be created or incurred or to exist any Lien other than Liens contemplated in § 8.2(i)(A).

 

§ 8.3       Restrictions on Investments.  Borrower shall not, and shall not permit any other Loan PartyPool Owner to, make or permit to exist or to remain outstanding any Investment except Investments in:

 

(a)           marketable direct or guaranteed obligations of the United States of America that mature within one (1) year from the date of purchase by Borrower or any Subsidiary GuarantorPool Owner;

 

(b)           marketable direct obligations of any of the following:  Federal Home Loan Mortgage Corporation, Student Loan Marketing Association, Federal Home Loan Banks, Federal National Mortgage Association, Government National Mortgage Association, Bank for Cooperatives, Federal Intermediate Credit Banks, Federal Financing Banks, Export-Import Bank of the United States, Federal Land Banks, or any other agency or instrumentality of the United States of America;

 

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(c)           demand deposits, certificates of deposit, bankers acceptances and time deposits of United States banks having total assets in excess of $100,000,000; provided, however, that the aggregate amount at any time so invested with any single bank having total assets of less than $1,000,000,000 will not exceed $200,000;

 

(d)           securities commonly known as “commercial paper” issued by a corporation organized and existing under the laws of the United States of America or any State which at the time of purchase are rated by Moody’s or by S&P at not less than “P 1” if then rated by Moody’s, and not less than “A 1”, if then rated by S&P;

 

(e)           mortgage-backed securities guaranteed by the Government National Mortgage Association, the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation and other mortgage-backed bonds which at the time of purchase are rated by Moody’s or by S&P at not less than “Aa” if then rated by Moody’s and not less than “AA” if then rated by S&P, such investment, when aggregated with the Investments set forth in § 8.3(k),  not to exceed five percent (5%) of Gross Asset Value;

 

(f)            repurchase agreements having a term not greater than ninety (90) days and fully secured by securities described in the foregoing subsection (a), (b) or (e) with banks described in the foregoing subsection (c) or with financial institutions or other corporations having total assets in excess of $500,000,000;

 

(g)           shares of so-called “money market funds” registered with the SEC under the Investment Company Act of 1940 which maintain a level per-share value, invest principally in investments described in the foregoing subsections (a) through (f) and have total assets in excess of $50,000,000;

 

(h)           the acquisition of fee interests or long-term ground lease interests by Borrower or any Subsidiary GuarantorPool Owner in (i) Real Estate which is utilized for income-producing Data Center Properties located in the continental United States or the District of Columbia and businesses and investments incidental thereto, and (ii) subject to the restrictions set forth in this § 8.3, the acquisition of Land Assets to be developed for the foregoing purposes and Development Properties to be used for the purposes set forth in § 8.3(h)(i);

 

(i)            Investments by Borrower in wholly-owned Subsidiaries of Borrower;

 

(j)            Investments in Land Assets, provided that the aggregate Investment therein shall not exceed the greater of (i) fiveseven and one half percent (57.5%) of Gross Asset Value or (ii) $45,000,000;

 

(k)           Investments in mortgages or notes receivable not to exceed five percent (5%) of Gross Asset Value;

 

(l)            Investments in Development Projects, provided that the aggregate Investment therein shall not exceed twenty-fivethirty percent (2530%) of the Gross Asset Value;

 

(m)          Investments in non-wholly owned Subsidiaries and Unconsolidated Affiliates, provided that the aggregate Investment therein shall not exceed twenty percent (20%) of Gross Asset Value;

 

(n)           Investments in assets located outside the United States, provided that the aggregate Investment therein shall not exceed ten percent (10%) of the Gross Asset Value;

 

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(o)           Investments (i) in equipment which will be incorporated into the development of Data Center Properties, (ii) with utility companies to bring critical power to Data Center Properties, and (iii) with fiber optic companies to bring fiber optics to Data Center Properties.

 

Notwithstanding the foregoing, in no event shall the aggregate value of the holdings of Borrower and Subsidiary GuarantorsPool Owners in the Investments described in § 8.3(j)-(n) exceed thirty-five percent (35%) of Gross Asset Value at any time.

 

For the purposes of this § 8.3, the Investment of Borrower or Subsidiary GuarantorsPool Owners in any non-Wholly Owned Subsidiaries and Unconsolidated Affiliates will equal (without duplication) the sum of (i) such Person’s pro rata share of their Unconsolidated Affiliate’s Investment in Land Assets; plus (ii) such Person’s pro rata share of any other Investments valued at the GAAP book value.

 

§ 8.4       Merger, Consolidation.  Borrower shall not, and shall not permit any other LoanTransaction Party to, become a party to any dissolution, liquidation, disposition of all or substantially all of its assets or business, merger, reorganization, consolidation or other business combination or agree to effect any asset acquisition, stock acquisition or other acquisition individually or in a series of transactions which may have a similar effect as any of the foregoing, in each case without the prior written consent of the Required Lenders except for (i) the merger or consolidation of one or more of the Subsidiaries of Borrower (other than any Subsidiary that is a Subsidiary GuarantorPool Owner) with and into Borrower (it being understood and agreed that in any such event Borrower will be the surviving Person) and (ii) the merger or consolidation of two or more Subsidiaries of Borrower; provided that no such merger or consolidation shall involve any Subsidiary that is a Subsidiary GuarantorPool Owner.

 

§ 8.5       Sale and Leaseback.  Borrower shall not, and shall not permit any other Loan Party to, enter into any arrangement, directly or indirectly, whereby any Loan Party shall sell or transfer any Real Estate owned by it in order that then or thereafter Borrower shall lease back such Real Estate without the prior written consent of the Agent, such consent not to be unreasonably withheld.

 

§ 8.6       Compliance with Environmental Laws.  Borrower shall not, and shall not permit any other LoanTransaction Party to, do any of the following:  (a) use any of the Real Estate or any portion thereof as a facility for the handling, processing, storage or disposal of Hazardous Substances, except for quantities of Hazardous Substances used in the ordinary course of LoanTransaction Parties’ or their tenants’ business and in material compliance with all applicable Environmental Laws, (b) cause or permit to be located on any of the Real Estate any underground tank or other underground storage receptacle for Hazardous Substances except in material compliance with Environmental Laws, (c) generate any Hazardous Substances on any of the Real Estate except in material compliance with Environmental Laws, (d) conduct any activity at any Real Estate or use any Real Estate in any manner that could reasonably be expected to cause a Release of Hazardous Substances on, upon or into the Real Estate or any surrounding properties or any threatened Release of Hazardous Substances which might give rise to liability under CERCLA or any other Environmental Law, or (e) directly or indirectly transport or arrange for the transport of any Hazardous Substances (except in material compliance with all Environmental Laws), except as any such use, generation, conduct or other activity described in clauses (a) to (e) of this § 8.6 could not reasonably be expected to have a Material Adverse Effect.

 

Borrower shall, and shall cause each other LoanTransaction Party to:

 

(i)            in the event of any change in applicable Environmental Laws governing the assessment, release or removal of Hazardous Substances, take all reasonable action as required by such Environmental Laws (including, without limitation, the conducting of engineering tests at the sole expense of LoanTransaction Parties) to confirm that no Hazardous Substances are or ever were Released or disposed of on the Eligible Real Estate Assets in violation of applicable Environmental Laws; and

 

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(ii)           if any Release or disposal of Hazardous Substances which LoanTransaction Parties may be legally obligated to contain, correct or otherwise remediate or which may otherwise expose such LoanTransaction Parties to liability shall occur or shall have occurred on any Eligible Real Estate Asset (including without limitation any such Release or disposal occurring prior to the acquisition or leasing of such Eligible Real Estate Asset by LoanTransaction Parties), the relevant LoanTransaction Party shall, after obtaining knowledge thereof, cause the prompt containment and removal of such Hazardous Substances and remediation of the Eligible Real Estate Asset in material compliance with all applicable Environmental Laws; provided, that each LoanTransaction Party shall be deemed to be in compliance with Environmental Laws for the purpose of this clause (ii) so long as it or a responsible third party with sufficient financial resources is taking reasonable action to remediate or manage such event or has taken and is diligently pursuing a challenge to any such alleged legal obligation through appropriate administrative or judicial proceedings.

 

§ 8.7       Distributions.

 

(a) Borrower shall not pay any Distribution to the partners, members or other owners of Borrower, and REIT shall not pay any Distribution to its shareholders, if such Distribution is in excess of the amount which (i) when added to the amount of all other Distributions paid in the same calendar quarter and (A) the preceding calendar quarters from the date of this Agreement or (B) the preceding three (3) calendar quarters (whichever is less), would exceed ninety-five percent (95%) of such Person’s Funds from Operations for such period; provided that (x) the limitations contained in this § 8.7(a) shall not preclude Borrower from making Distributions each year to its owners, pro rata in accordance with percentage interests, such that the amount received by REIT is sufficient  to cover (i) the liability of REIT for Taxes plus (ii) an amount equal to the greater of:  (1) the amount estimated by REIT in good faith after reasonable diligence to be necessary to permit REIT to distribute to its shareholders with respect to any calendar year (whether made during such year or after the end thereof) 100% of the “real estate investment trust taxable income” of REIT within the meaning of Section 857(b)(2) of the Code, determined without regard to deductions for dividends paid and the exclusions set forth in Sections 857(b)(2)(C), (D), (E) and (F) of the Code but including therein all net capital gains and net recognized built-in gains within the meaning of Treasury Regulations Section 1.337(d)-6 or Treasury Regulations Section 1.337(d)-7 (whether or not such gains might otherwise be excluded or excludable therefrom); or (2) the amount that is estimated by REIT in good faith after reasonable diligence to be necessary either to maintain REIT Status of REIT (if REIT exists) or to enable REIT to avoid the incurrence of any tax for any calendar year that could be avoided by reason of a distribution by REIT to its shareholders, with such distributions to be made as and when determined by REIT, whether during or after the end of the relevant calendar year; and (y) REIT shall be allowed to pay Distributions of the amount received pursuant to this § 8.7(a) to its shareholders.

 

(a)           (b) In the event that an Event of Default shall have occurred and be continuing, Borrower shall make no Distributions, and REIT shall not pay any Distribution to its shareholders, other than, if REIT exists and has elected REIT Status, Distributions pro rata in accordance with percentage interests to the owners of Borrower such that REIT receives an amount that is estimated by REIT in good faith after reasonable diligence to be necessary either to maintain REIT Status of REIT under the Code for any calendar year, or to enable REIT to avoid the payment of any tax for any calendar year that could be avoided by reason of a distribution by REIT to its shareholders, with such distributions to be made as and when determined by REIT, whether during or after the end of the relevant tax year and REIT shall be allowed to make Distributions of such amounts to its shareholders.

 

(b)           (c) Notwithstanding the foregoing, at any time when an Event of Default under § 12.1(a), (b), (h), (i) or (j) shall have occurred or the maturity of the Obligations has been accelerated, Borrower shall not, and shall not permit REIT to, make any Distributions whatsoever, directly or indirectly.

 

§ 8.8       Asset Sales.  Except for the transactions described on Schedule 8.8 hereto, Borrower shall not, and shall not permit any other LoanTransaction Party to, sell, transfer or otherwise dispose of any

 

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material asset other than pursuant to a bona fide arm’s length transaction.  Borrower shall not, and shall not permit any other LoanTransaction Party to, sell, transfer or otherwise dispose of any Real Estate in one transaction or a series of transactions during any four (4) consecutive fiscal quarters in excess of an amount equal to thirty-five percent (35%) of Gross Asset Value, except as the result of a condemnation or casualty and except for the granting of Permitted Liens, as applicable, without the prior written consent of the Agent and the Required Lenders.

 

§ 8.9       Intentionally Omitted.

 

§ 8.10     Restriction on Prepayment of Indebtedness.  Borrower shall not, and shall not permit any other LoanTransaction Party to, (a) prepay, redeem, defease, purchase or otherwise retire the principal amount, in whole or in part, of any Indebtedness other than the Obligations or the obligations under the Existing Credit Agreement or any agreement evidencing other Unsecured Debt, as applicable, after the occurrence of any Event of Default; provided, that the foregoing shall not prohibit (x) the prepayment of Indebtedness which is financed solely from the proceeds of a new loan which would otherwise be permitted by the terms of § 8.1; and (y) the prepayment, redemption, defeasance or other retirement of the principal of Indebtedness secured by Real Estate which is satisfied solely from the proceeds of a sale of the Real Estate securing such Indebtedness; and (b) modify any document evidencing any Indebtedness (other than the Obligations) to accelerate the maturity date of such Indebtedness after the occurrence of an Event of Default.

 

§ 8.11     Zoning and Contract Changes and Compliance.  Borrower shall not, and shall not permit any other LoanTransaction Party to, initiate or consent to any zoning reclassification of any Eligible Real Estate Asset or seek any variance under any existing zoning ordinance or use or permit the use of any Eligible Real Estate Asset in any manner that could result in such use becoming a non-conforming use under any zoning ordinance or any other applicable land use law, rule or regulation.  Borrower shall not, and shall not permit any other LoanTransaction Party to, initiate any change in any laws, requirements of governmental authorities or obligations created by private contracts and Leases which now or hereafter may materially adversely affect the ownership, occupancy, use or operation of any Eligible Real Estate Asset.

 

§ 8.12     Derivatives Contracts.  Borrower shall not, and shall not permit any other LoanTransaction Party to, contract, create, incur, assume or suffer to exist any Derivatives Contracts except for Derivatives Contracts made in the ordinary course of business and not prohibited pursuant to § 8.1.

 

§ 8.13     Transactions with Affiliates.  Borrower shall not, and shall not permit any other LoanTransaction Party to, permit to exist or enter into any transaction (including the purchase, sale, lease or exchange of any property or the rendering of any service) with any Affiliate (but not including any Subsidiary of Borrower), except (i) transactions in connection with the Management Agreements, (ii) transactions set forth on Schedule 6.15 attached hereto and (iii) transactions pursuant to the reasonable requirements of the business of such Person and upon fair and reasonable terms which are no less favorable to such Person than would be obtained in a comparable arm’s length transaction with a Person that is not an Affiliate.

 

§ 8.14     Management Fees.  Borrower shall not, and shall not permit any other LoanTransaction Party to, pay, or permit to be paid, any management fees or other payments under any Management Agreement for any Eligible Real Estate Asset to any manager that is an Affiliate of any LoanTransaction Party in the event that a Default or Event of Default shall have occurred and be continuing.

 

§ 8.15     §8.15      Sanctions; Anti-Corruption Laws.  Borrower shall not, and shall not permit any other Loan Party to, directly or knowingly indirectly, (a) use the proceeds of any Loan, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner or other individual or entity, to fund any activities of or business with any individual or entity, or in any Designated Jurisdiction, that, at the time of such funding, is the subject of Sanctions, or in any other manner that will result in a violation by any individual or entity (including any individual or entity participating in the transaction, whether

 

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 as Lender, Arranger, Agent, or otherwise) of Sanctions, or (b) use the proceeds of any Loan in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws.

 

SECTION 9

 

FINANCIAL COVENANTS

 

Borrower covenants and agrees that, so long as the Loan or any Note is outstanding or any Lender has any obligation to make any Advance of the Loan, in the event that Borrower shall not be in compliance with any of the following covenants, Borrower shall, within thirty (30) days after knowledge thereof (except as to § 9.1, which shall be governed by the cure period set forth in § 3.2), prepay the Loan in an amount that is necessary or take such other action as may be necessary to comply with the financial covenants set forth below:

 

§ 9.1       Unencumbered Asset Pool.  The outstanding principal balance of all Unsecured Debt shall not be greater than the Unencumbered Asset Pool Availability.

 

§ 9.2       Consolidated Total Indebtedness to Gross Asset Value.  Consolidated Total Indebtedness shall not exceed sixty percent (60%) of Gross Asset Value; provided that for a period of up to two (2) fiscal quarters following a Material Acquisition, Consolidated Total Indebtedness shall not exceed a maximum of sixty-five percent (65%) of Gross Asset Value.

 

§ 9.3       Secured Debt to Gross Asset Value.  Secured Debt shall not exceed forty percent (40%) of Gross Asset Value.

 

§ 9.4       Secured Recourse Indebtedness to Gross Asset Value.  Secured Recourse Indebtedness shall not exceed fifteen percent (15%) of Gross Asset Value; provided that, at any such time as Borrower has received an Investment Grade Rating, the foregoing covenant shall be of no further force and effect and Borrower shall not be required to comply therewith.

 

§ 9.5       Adjusted Consolidated EBITDA to Consolidated Fixed Charges.  The ratio of Adjusted Consolidated EBITDA determined for the most recently ended calendar quarter to Consolidated Fixed Charges for the most recently ended calendar quarter annualized, shall not be less than 1.701.50 to 1.0.

 

§ 9.6       Minimum Consolidated Tangible Net Worth.  Borrower’s Consolidated Tangible Net Worth shall not be less than the sum of (i) $1,277,009,816.002,274,892,911, plus (ii) eightyseventy-five percent (8075%) of the sum of (A) any additional Net Offering Proceeds after January 3December 31, 20132017, plus (B) the value of interests in Borrower or interests in REIT issued upon the contribution of assets to Borrower or its Subsidiaries after January 3December 31, 20132017 (with such value determined at the time of contribution).

 

§ 9.7 Unhedged Variable Rate Debt.  Unhedged Variable Rate Debt of Loan Parties and their respective Subsidiaries shall not exceed thirty percent (30%) of Gross Asset Value; provided that, at any such time as Borrower has received an Investment Grade Rating, the foregoing covenant shall be of no further force and effect and Borrower shall not be required to comply therewith.

 

§ 9.8 Unencumbered Asset Pool.  In addition, at all times, the Unencumbered Asset Pool Availability shall be determined from at least three (3) Eligible Real Estate Assets having a Gross Asset Value of not less than $150,000,000; provided however, this minimum $150,000,000 Gross Asset Value amount shall be reduced on a pro rata basis with the termination of any portion of the aggregate Commitment.

 

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SECTION 10

 

CLOSING CONDITIONS

 

The obligation of each Lender to make an Advance on the Closing Date shall be subject to the satisfaction of the following conditions precedent:

 

§ 10.1     Loan Documents.  Each of the Loan Documents shall have been duly executed and delivered by the respective parties thereto and shall be in full force and effect.  The Agent shall have received a fully executed counterpart of each such document.

 

§ 10.2     Certified Copies of Organizational Documents.  The Agent shall have received from each Loan Party a copy, certified as of a recent date by the appropriate officer of each State in which such Person is organized and in which the Eligible Real Estate Assets are located and a duly authorized officer, partner or member of such Person, as applicable, to be true and complete, of the partnership agreement, corporate charter or operating agreement and/or other organizational agreements of such Loan Party, as applicable, and its qualification to do business, as applicable, as in effect on such date of certification.

 

§ 10.3     Resolutions.  All action on the part of each Loan Party, as applicable, necessary for the valid execution, delivery and performance by such Person of each Loan Document to which such Person is or is to become a party shall have been duly and effectively taken, and evidence thereof reasonably satisfactory to the Agent shall have been provided to the Agent.

 

§ 10.4     Incumbency Certificate; Authorized Signers.  The Agent shall have received from each Loan Party an incumbency certificate, dated as of the Closing Date, signed by a duly authorized officer of such Person and giving the name and bearing a specimen signature of each individual who shall be authorized to sign, in the name and on behalf of such Person, each of the Loan Documents to which such Person is or is to become a party.  The Agent shall have also received from each Loan Party a certificate, dated as of the Closing Date, signed by a duly authorized representative of such Loan Party and giving the name and specimen signature of each Authorized Officer who shall be authorized (in the case of Borrower) to make Loan Requests and Conversion/Continuation Requests and (in the case of each Loan Party) to give notices and to take other action on behalf of Loan Parties under the Loan Documents.

 

§ 10.5     Opinion of Counsel.  The Agent shall have received an opinion addressed to the Lenders and the Agent and dated as of the Closing Date from counsel to Loan Parties in form and substance reasonably satisfactory to the Agent.

 

§ 10.6     Payment of Fees.  Loan Parties shall have paid to the Agent the fees payable to the Agent or any Lender pursuant to § 4.2.

 

§ 10.7     Insurance.  If requested by the Agent, the Agent shall have received certificates evidencing all policies of insurance as required by this Agreement or the other Loan Documents.

 

§ 10.8     Performance; No Default.  Loan Parties shall have performed and complied with all terms and conditions herein required to be performed or complied with by them on or prior to the Closing Date, and on the Closing Date there shall exist no Default or Event of Default.

 

§ 10.9     Representations and Warranties.  The representations and warranties made by Loan Parties in the Loan Documents or otherwise made by or on behalf of Loan Parties and their respective Subsidiaries in connection therewith or after the date thereof shall have been true and correct in all material respects when made and shall also be true and correct in all material respects on the Closing Date.

 

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§ 10.10  Proceedings and Documents.  All proceedings in connection with the transactions contemplated by this Agreement and the other Loan Documents shall be reasonably satisfactory to the Agent and the Agent’s counsel in form and substance, and the Agent shall have received all information and such counterpart originals or certified copies of such documents and such other certificates, opinions, assurances, consents, approvals or documents as the Agent and the Agent’s counsel may reasonably require, including all documentation required by any Lender to satisfy the requirements of § 6.30.

 

§ 10.11  Eligible Real Estate Qualification Documents.  The Eligible Real Estate Qualification Documents for each Eligible Real Estate Asset included in the Unencumbered Asset Pool as of the Closing Date shall have been delivered to the Agent at Loan Parties’ expense and shall be in form and substance reasonably satisfactory to the Agent.

 

§ 10.12  Compliance Certificate.  The Agent shall have received a Compliance Certificate dated as of the date of the Closing Date demonstrating pro forma compliance with each of the covenants calculated therein based upon REIT’s most recent Form 10-Q.  Further, such Compliance Certificate shall include within the calculation of Net Operating Income any Eligible Real Estate Assets which have been owned for less than a calendar quarter, and shall be based upon financial data and information with respect to Eligible Real Estate Assets as of the end of the most recent calendar month as to which data and information is available.

 

§ 10.13  [Reserved].

 

§ 10.14  Consents.  The Agent shall have received evidence reasonably satisfactory to the Agent that all necessary stockholder, partner, member or other consents required in connection with the

 

consummation of the transactions contemplated by this Agreement and the other Loan Documents have been obtained.

 

§ 10.15  Other.  The Agent shall have reviewed such other documents, instruments, certificates, opinions, assurances, consents and approvals as the Agent or the Agent’s Special Counsel may reasonably have requested.

 

SECTION 11

 

CONDITIONS TO ALL ADVANCES

 

The obligation of each Lender to make an Advance on the Closing Date and any subsequent Advance shall also be subject to the satisfaction of the following conditions precedent:

 

§ 11.1     Prior Conditions Satisfied.  All conditions set forth in § 10 shall continue to be satisfied as of the date upon which any Advance is to be made.

 

§ 11.2     Representations True; No Default.  Each of the representations and warranties made by or on behalf of LoanTransaction Parties or any of their respective Subsidiaries contained in this Agreement, the other Loan Documents or in any document or instrument delivered pursuant to or in connection with this Agreement shall be true in all material respects both as of the date as of which they were made and shall also be true in all material respects as of the time of the making of such Advance, with the same effect as if made at and as of that time, except to the extent of changes resulting from transactions permitted by the Loan Documents (it being understood and agreed that any representation or warranty which by its terms is made as of a specified date shall be required to be true and correct only as of such specified date), and no Default or Event of Default shall have occurred and be continuing.

 

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§ 11.3     Borrowing Documents.  The Agent shall have received a fully completed Loan Request for such Advance and the other documents and information (including, without limitation, a Compliance Certificate; provided, however, that the calculation of Gross Asset Value in such Compliance Certificate need only contain the Gross Asset Value calculation submitted to the Agent in the most recent quarterly Compliance Certificate delivered pursuant to § 7.4(c), subject to any adjustments necessary to reflect any newly acquired or sold Real Estate since the date of such quarterly Compliance Certificate) as required by § 2.7.

 

SECTION 12

 

EVENTS OF DEFAULT; ACCELERATION; ETC.

 

§ 12.1     Events of Default and Acceleration.  If any of the following events (“Events of Default” or, if the giving of notice or the lapse of time or both is required, then, prior to such notice or lapse of time, “Defaults”) shall occur:

 

(a)           Borrower shall fail to pay any principal of the Loan when the same shall become due and payable, whether at the stated date of maturity or any accelerated date of maturity or at any other date fixed for payment;

 

(b)           Borrower shall fail to pay any interest on the Loan within five (5) days of the date that the same shall become due and payable or any fees or other sums due hereunder (other than any voluntary prepayment) or under any of the other Loan Documents within ten (10) days after notice from the Agent, whether at the stated date of maturity or any accelerated date of maturity or at any other date fixed for payment;

 

(c)           Borrower shall fail to comply with the covenant contained in § 9.1 and such failure shall continue uncured after written notice thereof shall have been given to Loan Parties by the Agent as provided in § 3.2;

 

(d)           Borrower shall fail to perform any other term, covenant or agreement contained in (i) §8.15 and such failure continues for thirty (30) days after written notice thereof shall have been given to the Loan Parties by the Agent, or (ii) § 9.2, § 9.3, § 9.4, § 9.5, or § 9.6, § 9.7 or § 9.8 and such failure under this clause (d)(ii) shall continue for the thirty (30) day cure period provided in the preamble to Article 9 after written notice thereof shall have been given to Loan Parties by the Agent as provided in the preamble to Article 9;

 

(e)           any Loan Party shall fail to perform any other term, covenant or agreement contained herein or in any of the other Loan Documents which they are required to perform (other than those specified in the other subclauses of this § 12 (including, without limitation, § 12.2 below) or in the other Loan Documents), and such failure shall continue for thirty (30) days after Loan Parties’ receipt from the Agent of written notice thereof, and in the case of a default that cannot be cured within such thirty (30) day period despite Loan Parties’ diligent efforts but is susceptible of being cured within ninety (90) days of Loan Parties’ receipt of the Agent’s original notice, then Loan Parties shall have such additional time as is reasonably necessary to effect such cure, but in no event in excess of ninety (90) days from Loan Parties’ receipt of the Agent’s original notice;

 

(f)            any material representation or warranty made by or on behalf of Loan Parties or any of their respective Subsidiaries in this Agreement or any other Loan Document, or any report, certificate, financial statement, request for an Advance, or in any other document or instrument delivered pursuant to or in connection with the Loan, any Advance, this Agreement, or any of the

 

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other Loan Documents shall prove to have been false in any material respect upon the date when made or deemed to have been made or repeated;

 

(g)           any LoanTransaction Party shall fail to pay when due (including, without limitation, at maturity), or within any applicable period of notice and grace, any principal, interest or other amount on account of any obligation for borrowed money or credit received or other Indebtedness, or shall fail to observe or perform any term, covenant or agreement contained in any agreement by which it is bound, evidencing or securing any obligation for borrowed money or credit received or other Indebtedness and the holder or holders thereof or of any obligations issued thereunder have accelerated the maturity thereof; provided that the events described in §12.1(g) shall not constitute an Event of Default unless such failure to perform, together with other failures to perform as described in §12.1(g), involve singly or in the aggregate obligations for (x) any Indebtedness which is recourse to Borrower or any of the Subsidiary GuarantorsPool Owners (including, without limitation, Secured Recourse Indebtedness) totaling in excess of $25,000,000 or (y) Non-Recourse Indebtedness of Borrower or any of the Subsidiary GuarantorsPool Owners totaling in excess of $50,000,000;

 

(h)           any LoanTransaction Party or REIT, (i) shall make an assignment for the benefit of creditors, or admit in writing its general inability to pay or generally fail to pay its debts as they mature or become due, or shall petition or apply for the appointment of a trustee or other custodian, liquidator or receiver for it or any substantial part of its assets, (ii) shall commence any case or other proceeding relating to it under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation or similar law of any jurisdiction, now or hereafter in effect, or (iii) shall take any action to authorize or in furtherance of any of the foregoing;

 

(i)            a petition or application shall be filed for the appointment of a trustee or other custodian, liquidator or receiver of any LoanTransaction Party or REIT or any substantial part of the assets of any thereof, or a case or other proceeding shall be commenced against any such Person under any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation or similar law of any jurisdiction, now or hereafter in effect, and any such Person shall indicate its approval thereof, consent thereto or acquiescence therein or such petition, application, case or proceeding shall not have been dismissed within ninety (90) days following the filing or commencement thereof;

 

(j)            a decree or order is entered appointing a trustee, custodian, liquidator or receiver for any LoanTransaction Party or REIT or adjudicating any such Person, bankrupt or insolvent, or approving a petition in any such case or other proceeding, or a decree or order for relief is entered in respect of any such Person in an involuntary case under federal bankruptcy laws as now or hereafter constituted;

 

(k)           there shall remain in force, undischarged, unsatisfied and unstayed, for more than sixty (60) days one or more uninsured or unbonded final judgments against Borrower or any Subsidiary GuarantorPool Owner that, either individually or in the aggregate, exceed $50,000,000;

 

(l)            any of the Loan Documents shall be canceled, terminated, revoked or rescinded otherwise than in accordance with the terms thereof or the express prior written agreement, consent or approval of the Required Lenders, or any action at law, suit in equity or other legal proceeding to cancel, revoke or rescind any of the Loan Documents shall be commenced by or on behalf of any Loan Party, or any court or any other governmental or regulatory authority or agency of competent jurisdiction shall make a determination, or issue a judgment, order, decree or ruling, to the effect that any one or more of the Loan Documents is illegal, invalid or unenforceable in accordance with the terms thereof;

 

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(m)          any dissolution, termination, partial or complete liquidation, merger or consolidation of any LoanTransaction Party shall occur or any sale, transfer or other disposition of the assets of any LoanTransaction Party shall occur other than as permitted under the terms of this Agreement or the other Loan Documents;

 

(n)           with respect to any Guaranteed Pension Plan, an ERISA Reportable Event shall have occurred and such event reasonably would be expected to result in liability of any LoanTransaction Party to pay money to the PBGC or such Guaranteed Pension Plan in an aggregate amount exceeding $25,000,000 and one of the following shall apply with respect to such event:  (x) such event in the circumstances occurring reasonably would be expected to result in the termination of such Guaranteed Pension Plan by the PBGC or for the appointment by the appropriate United States District Court of a trustee to administer such Guaranteed Pension Plan; or (y) a trustee shall have been appointed by the United States District Court to administer such Plan; or (z) the PBGC shall have instituted proceedings to terminate such Guaranteed Pension Plan;

 

(o)           any Change of Control shall occur; or

 

(p)           an Event of Default under any of the other Loan Documents shall occur;

 

then, and upon any such Event of Default, the Agent may, and upon the request of the Required Lenders shall, by notice in writing to Loan Parties declare all amounts owing with respect to this Agreement, the Notes and the other Loan Documents to be, and they shall thereupon forthwith become, immediately due and payable without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by Borrower; provided that in the event of any Event of Default specified in § 12.1(h), § 12.1(i) or § 12.1(j), all such amounts shall become immediately due and payable automatically and without any requirement of presentment, demand, protest or other notice of any kind from any of the Lenders or the Agent.

 

§ 12.2     Certain Cure Periods; Limitation of Cure Periods.

 

(a)           Notwithstanding anything contained in § 12.1 to the contrary, (i) no Event of Default shall exist hereunder upon the occurrence of any failure described in § 12.1(b) in the event that Loan Parties cure such Default within five (5) Business Days after the date such payment is due, provided that no such cure period shall apply to any payments due upon the maturity of the Notes, and (ii) no Event of Default shall exist hereunder upon the occurrence of any failure described in § 12.1(e) in the event that, if such Default consists of the failure to provide insurance as required by § 7.7, Loan Parties cure such Default within fifteen (15) days following receipt of written notice of such Default or with respect to the occurrence of any other failure described in § 12.1(e) in the event such failure shall continue for thirty (30) days after Loan Parties’ receipt from the Agent of written notice thereof, and in the case of a default that cannot be cured within such thirty (30) day period despite Loan Parties’ diligent efforts but is susceptible of being cured within ninety (90) days of Loan Parties’ receipt of the Agent’s original notice, then Loan Parties shall have such additional time as is reasonably necessary to effect such cure, but in no event in excess of ninety (90) days from Loan Parties’ receipt of the Agent’s original notice, provided that the provisions of this clause (ii) shall not pertain to any default consisting of a failure to comply with § 8.1, § 8.2, § 8.3, § 8.4, § 8.7, § 8.8, or § 8.14, or to any Default excluded from any provision of cure of defaults contained in any other of the Loan Documents.

 

(b)           In the event that there shall occur any Default that affects only certain Eligible Real Estate Assets or the owner(s) thereof (if such owner is a Subsidiary GuarantorPool Owner), then Loan Parties may elect to cure such Default (so long as no other Default or Event of Default would arise as a result) by electing to have the Agent remove such Eligible Real Estate Asset from the calculation of Unencumbered Asset Pool  Availability and by reducing the outstanding principal amount of the Loan by the amount of the Unencumbered Asset Pool  Availability attributable to such Eligible Real Estate Asset, in which event such

 

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removal and reduction shall be completed within thirty (30) days after receipt of notice of such Default from the Agent or the Required Lenders.

 

§ 12.3     Termination of Commitments.  If any one or more Events of Default specified in § 12.1(h), § 12.1(i) or § 12.1(j) shall occur, then immediately and without any action on the part of the Agent or any Lender any unused portion of the credit and the Commitments hereunder shall automatically terminate and the Lenders shall be relieved of all obligations to make Advances to Borrower, and all Obligations shall be deemed automatically accelerated and declared due and payable in full.  If any other Event of Default shall have occurred, the Agent may, and upon the election of the Required Lenders shall, by notice to Loan Parties, terminate the obligation to make Advances to Borrower and accelerate the Obligations as provided in § 12.1 above.  No termination under this § 12.3 shall relieve Loan Parties of their obligations to the Lenders arising under this Agreement or the other Loan Documents.

 

§ 12.4     Remedies.  To the extent permitted by applicable law, in case any one or more Events of Default shall have occurred and be continuing, and whether or not the Lenders shall have accelerated the maturity of the Loan pursuant to § 12.1, the Agent on behalf of the Lenders may, and upon the consent of the Required Lenders shall, proceed to protect and enforce their rights and remedies under this Agreement, the Notes and/or any of the other Loan Documents by suit in equity, action at law or other appropriate proceeding, including to the full extent permitted by applicable law the specific performance of any covenant or agreement contained in this Agreement and the other Loan Documents, the obtaining of the ex parte appointment of a receiver, and, if any amount shall have become due, by declaration or otherwise, the enforcement of the payment thereof.  No remedy herein conferred upon the Agent or the holder of any Note is intended to be exclusive of any other remedy and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or any other provision of law.  Notwithstanding the provisions of this Agreement providing that the Loan may be evidenced by multiple Notes in favor of the Lenders, the Lenders acknowledge and agree that only the Agent may exercise any remedies arising by reason of a Default or Event of Default.  If any Loan Party fails to perform any agreement or covenant contained in this Agreement or any of the other Loan Documents beyond any applicable period for notice and cure, the Agent may itself perform, or cause to be performed, any agreement or covenant of such Person contained in this Agreement or any of the other Loan Documents which such Person shall fail to perform, and the out-of-pocket costs of such performance, together with any reasonable expenses, including reasonable attorneys’ fees actually incurred (including attorneys’ fees incurred in any appeal) by the Agent in connection therewith, shall be payable by Loan Parties upon demand and shall constitute a part of the Obligations and shall if not paid within thirty (30) days after demand bear interest at the rate for overdue amounts as set forth in this Agreement.  In the event that all or any portion of the Obligations is collected by or through an attorney-at-law, Loan Parties shall pay all costs of collection including, but not limited to, reasonable attorney’s fees.

 

§ 12.5     Distribution of Collateral Proceeds.  In the event that, following the occurrence and during the continuance of any Event of Default, any monies are received in connection with the enforcement of any of the Loan Documents, or otherwise with respect to the realization upon any of the assets of Loan Parties, such monies shall be distributed for application as follows:

 

(a)           First, to the payment of, or (as the case may be) the reimbursement of the Agent for or in respect of, all reasonable out-of-pocket costs, expenses, disbursements and losses which shall have been paid, incurred or sustained by the Agent in accordance with the terms of the Loan Documents in connection with the collection of such monies by the Agent, for the exercise, protection or enforcement by the Agent of all or any of the rights, remedies, powers and privileges of the Agent or the Lenders under this Agreement or any of the other Loan Documents or in support of any provision of adequate indemnity to the Agent against any taxes or liens which by law shall have, or may have, priority over the rights of the Agent or the Lenders to such monies;

 

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(b)           Second, to all other Obligations (including any interest, expenses or other obligations incurred after the commencement of a bankruptcy) in the following order:

 

(i)            to any other fees and expenses due to the Lenders under the Loan Documents until paid in full;

 

(ii)           to the payment of accrued and unpaid interest on the Loan, for the ratable benefit of the Lenders, until paid in full;

 

(iii)          payments of unpaid principal of the Advances and amounts constituting obligations under any Approved Derivatives Contract, to be paid to the Lenders and/or any counterparty under an Approved Derivatives Contract, equally and ratably in accordance with the respective amounts thereof then due and owing to such Persons until paid in full;

 

(iv)          to payment of all other amounts due under any of the Loan Documents to be applied for the ratable benefit of the Agent and/or the Lenders until paid in full.

 

(c)           Third, the excess, if any, shall be returned to Loan Parties or to such other Persons as are entitled thereto.

 

SECTION 13

 

SETOFF

 

During the continuance of any Event of Default, any deposits (general or specific, time or demand, provisional or final, regardless of currency, maturity, or the branch where such deposits are held) or other sums credited by or due from any Lender or any Affiliate thereof to Borrower and any securities or other property of Borrower in the possession of such Lender or any Affiliate may, without notice to Borrower (any such notice being expressly waived by Borrower) but with the prior written approval of the Agent, be applied to or set off against the payment of Obligations and any and all other liabilities, direct, or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, of Borrower to such Lender.  Each of the Lenders agrees with each other Lender that if such Lender shall receive from Borrower, whether by voluntary payment, exercise of the right of setoff, or otherwise, and shall retain and apply to the payment of the Note or Notes held by such Lender any amount in excess of its ratable portion of the payments received by all of the Lenders with respect to the Notes held by all of the Lenders, such Lender will make such disposition and arrangements with the other Lenders with respect to such excess, either by way of distribution, pro tanto assignment of claims, subrogation or otherwise as shall result in each Lender receiving in respect of the Notes held by it its proportionate payment as contemplated by this Agreement; provided that if all or any part of such excess payment is thereafter recovered from such Lender, such disposition and arrangements shall be rescinded and the amount restored to the extent of such recovery, but without interest.

 

Notwithstanding the foregoing, in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Agent for further application in accordance with the provisions of § 14.16 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff.  The rights of each Lender and its Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender or its Affiliates may have.

 

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SECTION 14

 

THE AGENT

 

§ 14.1     Authorization.  The Agent is authorized to take such action on behalf of each of the Lenders and to exercise all such powers as are hereunder and under any of the other Loan Documents and any related documents delegated to the Agent and all other powers not specifically reserved to the Lenders, together with such powers as are reasonably incident thereto, provided that no duties or responsibilities not expressly assumed herein or therein shall be implied to have been assumed by the Agent.  The obligations of the Agent hereunder are primarily administrative in nature, and nothing contained in this Agreement or any of the other Loan Documents shall be construed to constitute the Agent as a trustee for any Lender or to create an agency or fiduciary relationship.  The Agent shall act as the contractual representative of the Lenders hereunder, and notwithstanding the use of the term “Agent”, it is understood and agreed that the Agent shall not have any fiduciary duties or responsibilities to any Lender by reason of this Agreement or any other Loan Document and is acting as an independent contractor, the duties and responsibilities of which are limited to those expressly set forth in this Agreement and the other Loan Documents.  Loan Parties and any other Person shall be entitled to conclusively rely on a statement from the Agent that it has the authority to act for and bind the Lenders pursuant to this Agreement and the other Loan Documents.

 

§ 14.2     Employees and Agents.  The Agent may exercise its powers and execute its duties by or through employees or agents and shall be entitled to take, and to rely on, advice of counsel concerning all matters pertaining to its rights and duties under this Agreement and the other Loan Documents.  The Agent may utilize the services of such Persons as the Agent may reasonably determine, and all reasonable fees and expenses of any such Persons shall be paid by Loan Parties.

 

§ 14.3     No Liability.  Neither the Agent nor any of its shareholders, directors, officers or employees nor any other Person assisting them in their duties nor any agent, or employee thereof, shall be liable for (a) any waiver, consent or approval given or any action taken, or omitted to be taken, in good faith by it or them hereunder or under any of the other Loan Documents, or in connection herewith or therewith, or be responsible for the consequences of any oversight or error of judgment whatsoever, except that the Agent or such other Person, as the case may be, shall be liable for losses due to its willful misconduct or gross negligence as finally determined by a court of competent jurisdiction after the expiration of all applicable appeal periods or (b) any action taken or not taken by the Agent with the consent or at the request of the Required Lenders (or such larger percentage of Lenders as may be required hereunder).  The Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Agent for the account of the Lenders, unless the Agent has received notice from a Lender or Loan Parties referring to the Loan Documents and describing with reasonable specificity such Default or Event of Default and stating that such notice is a “notice of default”.

 

§ 14.4     No Representations.  The Agent shall not be responsible for the execution or validity or enforceability of this Agreement, the Notes, any of the other Loan Documents or any instrument at any time constituting, or intended to constitute, collateral security for the Notes, or for the value of any such collateral security or for the validity, enforceability or collectability of any such amounts owing with respect to the Notes, or for any recitals or statements, warranties or representations made herein, or any agreement, instrument or certificate delivered in connection therewith or in any of the other Loan Documents or in any certificate or instrument hereafter furnished to it by or on behalf of Loan Parties or any of their respective Subsidiaries, or be bound to ascertain or inquire as to the performance or observance of any of the terms, conditions, covenants or agreements herein or in any of the other Loan Documents (except that the Agent shall confirm receipt of the items required to be delivered to it in §§ 10 and 11 hereof).  The Agent shall not be bound to ascertain whether any notice, consent, waiver or request delivered to it by Loan Parties or any holder of any of the Notes shall have been duly authorized or is true, accurate and complete.  The Agent has not made nor does it now make any representations or warranties, express or implied, nor does it assume any liability to

 

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the Lenders, with respect to the creditworthiness or financial condition of Loan Parties or any of their respective Subsidiaries, or the value of the Unencumbered Asset Pool or any other assets of Loan Parties or any of their respective Subsidiaries.  Each Lender acknowledges that it has, independently and without reliance upon the Agent or any Lender, and based upon such information and documents as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.  Each Lender also acknowledges that it will, independently and without reliance upon the Agent or any Lender, based upon such information and documents as it deems appropriate at the time, continue to make its own credit analysis and decisions in taking or not taking action under this Agreement and the other Loan Documents.  The Agent’s Special Counsel has only represented the Agent and RBC in connection with the Loan Documents and the only attorney client relationship or duty of care is between the Agent’s Special Counsel and the Agent or RBC.  Each Lender has been independently represented by separate counsel on all matters regarding the Loan Documents.

 

§ 14.5     Payments.

 

(a)           A payment by Loan Parties to the Agent hereunder or under any of the other Loan Documents for the account of any Lender shall constitute a payment to such Lender.  The Agent agrees to distribute to each Lender not later than one Business Day after the Agent’s receipt of good funds, determined in accordance with the Agent’s customary practices, such Lender’s pro rata share of payments received by the Agent for the account of the Lenders except as otherwise expressly provided herein or in any of the other Loan Documents.  In the event that the Agent fails to distribute such amounts within one Business Day as provided above, the Agent shall pay interest on such amount at a rate per annum equal to the Federal Funds Effective Rate from time to time in effect.  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, each payment of Borrower hereunder shall be applied in accordance with §14.16.

 

(b)           If in the opinion of the Agent the distribution of any amount received by it in such capacity hereunder, under the Notes or under any of the other Loan Documents might involve it in liability, it may refrain from making such distribution until its right to make such distribution shall have been adjudicated by a court of competent jurisdiction.  If a court of competent jurisdiction shall adjudge that any amount received and distributed by the Agent is to be repaid, each Person to whom any such distribution shall have been made shall either repay to the Agent its proportionate share of the amount so adjudged to be repaid or shall pay over the same in such manner and to such Persons as shall be determined by such court.

 

§ 14.6     Holders of Notes.  Subject to the terms of § 18, the Agent may deem and treat the payee of any Note as the absolute owner or purchaser thereof for all purposes hereof until it shall have been furnished in writing with a different name by such payee or by a subsequent holder, assignee or transferee.

 

§ 14.7     Indemnity.  The Lenders ratably agree hereby to indemnify and hold harmless the Agent from and against any and all claims, actions and suits (whether groundless or otherwise), losses, damages, costs, reasonable expenses (including any expenses for which the Agent has not been reimbursed by Borrower as required by § 15 and without limiting Borrower’s obligation to do so), and liabilities of every nature and character arising out of or related to this Agreement, the Notes, or any of the other Loan Documents or the transactions contemplated or evidenced hereby or thereby, or the Agent’s actions taken hereunder or thereunder, except to the extent that any of the same shall be directly caused by the Agent’s willful misconduct or gross negligence as finally determined by a court of competent jurisdiction after the expiration of all applicable appeal periods.  The agreements in this § 14.7 shall survive the payment of all amounts payable under the Loan Documents.

 

§ 14.8     The Agent as Lender.  In its individual capacity, RBC shall have the same obligations and the same rights, powers and privileges in respect to its Commitment and the Advances made by it, and as the holder of any of the Notes as it would have were it not also the Agent.

 

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§ 14.9     Resignation.  The Agent may resign at any time by giving thirty (30) calendar days’ prior written notice thereof to the Lenders and Loan Parties.  The Required Lenders may remove the Agent from its capacity as Agent in the event of the Agent’s gross negligence or willful misconduct or, to the extent permitted by Legal Requirements, if the Person serving as Agent is a Defaulting Lender pursuant to clause (d) or clause (e) of the definition thereof.  Upon any such resignation, or removal, the Required Lenders, subject to the terms of § 18.1, shall have the right to appoint as a successor Agent any Lender or any bank whose senior debt obligations are rated not less than “A” or its equivalent by Moody’s or not less than “A” or its equivalent by S&P and which has a net worth of not less than $500,000,000; provided that any such replacement Agent shall have a Commitment Percentage of not less than ten percent (10%).  Unless a Default or Event of Default shall have occurred and be continuing, such successor Agent shall be reasonably acceptable to Loan Parties.  If no successor Agent shall have been appointed and shall have accepted such appointment within thirty (30) days after the retiring Agent’s giving of notice of resignation or the Required Lender’s removal of the Agent, then the retiring or removed Agent may, on behalf of the Lenders, appoint a successor Agent, which shall be any Lender or any financial institution whose senior debt obligations are rated not less than “A2” or its equivalent by Moody’s or not less than “A” or its equivalent by S&P and which has a net worth of not less than $500,000,000.  Upon the acceptance of any appointment as Agent hereunder by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring or removed Agent, and the retiring or removed Agent shall be discharged from its duties and obligations hereunder as the Agent.  After any retiring Agent’s resignation or removal, the provisions of this Agreement and the other Loan Documents shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as Agent.  Upon any change in the Agent under this Agreement, the resigning or removed Agent shall execute such assignments of and amendments to the Loan Documents as may be necessary to substitute the successor Agent for the resigning or removed Agent.

 

§ 14.10  Duties in the Case of Enforcement.  In case one or more Events of Default have occurred and shall be continuing, and whether or not acceleration of the Obligations shall have occurred, the Agent may and, if (a) so requested by the Required Lenders and (b) the Lenders have provided to the Agent such additional indemnities and assurances in accordance with their respective Commitment Percentages against expenses and liabilities as the Agent may reasonably request, shall proceed to exercise all or any legal and equitable and other rights or remedies as it may have; provided, however, that unless and until the Agent shall have received such directions, the Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default or Event of Default as it shall deem to be in the best interests of the Lenders.  Without limiting the generality of the foregoing, if the Agent reasonably determines payment is in the best interest of all the Lenders, the Agent may without the approval of the Lenders pay taxes and insurance premiums and spend money for maintenance, repairs or other expenses which may be necessary to be incurred, and the Agent shall promptly thereafter notify the Lenders of such action.  Each Lender shall, within thirty (30) days of request therefor, pay to the Agent its Commitment Percentage of the reasonable costs incurred by the Agent in taking any such actions hereunder to the extent that such costs shall not be promptly reimbursed to the Agent by Loan Parties (and without limiting Loan Parties’ obligation to do so) within such period with respect to the Eligible Real Estate Assets.  The Required Lenders may direct the Agent in writing as to the method and the extent of any such exercise, the Lenders hereby agreeing to indemnify and hold the Agent harmless in accordance with their respective Commitment Percentages from all liabilities incurred in respect of all actions taken or omitted in accordance with such directions, except to the extent that any of the same shall be directly caused by the Agent’s willful misconduct or gross negligence as finally determined by a court of competent jurisdiction after the expiration of all applicable appeal periods, provided that the Agent need not comply with any such direction to the extent that the Agent reasonably believes the Agent’s compliance with such direction to be unlawful in any applicable jurisdiction or commercially unreasonable under the UCC as enacted in any applicable jurisdiction.

 

§ 14.11  Bankruptcy.  In the event a bankruptcy or other insolvency proceeding is commenced by or against any Loan Party with respect to the Obligations, the Agent shall have the sole and exclusive right to file and pursue a joint proof claim on behalf of all Lenders.  Any votes with respect to such

 

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claims or otherwise with respect to such proceedings shall be subject to the vote of the Required Lenders or all of the Lenders as required by this Agreement.

 

§ 14.12  Intentionally Omitted.

 

§ 14.13  Reliance by Agent.  The Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by an Authorized Officer.  The Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon.  In determining compliance with any condition hereunder to the making of an Advance, that by its terms must be fulfilled to the satisfaction of a Lender, the Agent may presume that such condition is satisfactory to such Lender unless the Agent shall have received notice to the contrary from such Lender prior to the making of such Advance.  The Agent may consult with legal counsel (who may be counsel for Loan Parties), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

 

§ 14.14  Approvals.  If consent is required for some action under this Agreement, or except as otherwise provided herein an approval of the Lenders or the Required Lenders is required or permitted under this Agreement, each Lender agrees to give the Agent, within ten (10) days of receipt of the request for action together with all reasonably requested information related thereto (or such lesser period of time required by the terms of the Loan Documents), notice in writing of  approval or disapproval (collectively “Directions”) in respect of any action requested or proposed in writing pursuant to the terms hereof.  To the extent that any Lender does not approve any recommendation of the Agent, such Lender shall in such notice to the Agent describe the actions that would be acceptable to such Lender.  If consent is required for the requested action, any Lender’s failure to respond to a request for Directions within the required time period shall be deemed to constitute a Direction to take such requested action.  In the event that any recommendation is not approved by the requisite number of Lenders and a subsequent approval on the same subject matter is requested by the Agent, then for the purposes of this paragraph each Lender shall be required to respond to a request for Directions within five (5) Business Days of receipt of such request.  The Agent and each Lender shall be entitled to assume that any officer of the other Lenders delivering any notice, consent, certificate or other writing is authorized to give such notice, consent, certificate or other writing unless the Agent and such other Lenders have otherwise been notified in writing.

 

§ 14.15  Loan Parties Not Beneficiary.  Except for the provisions of § 14.9 relating to the appointment of a successor Agent, the provisions of this § 14 are solely for the benefit of the Agent and the Lenders, may not be enforced by Loan Parties, and except for the provisions of § 14.9, may be modified or waived without the approval or consent of Loan Parties.

 

§ 14.16  Defaulting Lenders.

 

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

 

(i)            That 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 § 27.

 

(ii)           Any payment of principal, interest, fees or other amounts received by the Agent for the account of that Defaulting Lender (whether voluntary or mandatory, at maturity, or otherwise, and including any amounts made available to the Agent by that Defaulting Lender pursuant to § 13), shall be applied at such time or times as may be determined by the Agent as follows:  first, to

 

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the payment of any amounts owing by that Defaulting Lender to the Agent hereunder; second, as Borrower may request (so long as no Default or Event of Default exists), to the funding of any Advances in respect of which that Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Agent; third, if so determined by the Agent and Loan Parties, to be held in a non-interest bearing deposit account and released in order to satisfy obligations of that Defaulting Lender to fund Advances under this Agreement; fourth, to the payment of any amounts owing to the Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; fifth, so long as no Default or Event of Default exists or non-defaulting Lenders have been paid in full all amounts then due, to the payment of any amounts owing to Loan Parties as a result of any judgment of a court of competent jurisdiction obtained by Loan Parties against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; and sixth, to that 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 Advance in respect of which that Defaulting Lender has not fully funded its appropriate share and (y) such Advance was made at a time when the conditions set forth in § 11 were satisfied or waived, such payment shall be applied solely to pay the Advances of all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Advances of that Defaulting Lender.  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 shall be deemed paid to and redirected by that Defaulting Lender, and each Lender irrevocably consents hereto.

 

(iii)          [Intentionally Omitted].

 

(iv)          [Intentionally Omitted].

 

(b)           (v) During any period that a Lender is a Defaulting Lender, Loan Parties may, by giving written notice thereof to the Agent, such Defaulting Lender, and the other Lenders, demand that such Defaulting Lender assign its Commitment to an Eligible Assignee subject to and in accordance with the provisions of § 18.1, with Loan Parties being obligated to pay the applicable assignment fee due under § 18.2 in the event same is not paid by the Defaulting Lender, provided further that the amount of such fee shall be deducted from any payments to be made to the Defaulting Lender under this § 14.16(a)(v).  No party hereto shall have any obligation whatsoever to initiate any such replacement or to assist in finding an Eligible Assignee.  In addition, any Lender who is not a Defaulting Lender may, but shall not be obligated to, in its sole discretion, acquire the face amount of all or a portion of such Defaulting Lender’s Commitment via an assignment subject to and in accordance with the provisions of § 18.1.  No such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Agent in an aggregate amount sufficient with any applicable amounts held pursuant to the immediately preceding subsection (ii), upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of Loan Parties and the Agent, the applicable pro rata share of Advances previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Agent or any Lender hereunder (and interest accrued thereon), and (y) acquire (and fund as appropriate) such Defaulting Lender’s full pro rata share of all Advances.  Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under any Legal Requirement without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

 

(c)           If a Lender is a Defaulting Lender because it has failed to make timely payment to the Agent of any amount required to be paid to the Agent hereunder (without giving effect to any notice or cure periods), in addition to other rights and remedies which the Agent or Borrower may have under the 

 

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immediately preceding provisions or otherwise, the Agent shall be entitled (i) to collect interest from such Defaulting Lender on such delinquent payment for the period from the date on which the payment was due until the date on which the payment is made at the Federal Funds Effective Rate, (ii) to withhold or setoff and to apply in satisfaction of the defaulted payment and any related interest, any amounts otherwise payable to such Defaulting Lender under this Agreement or any other Loan Document and (iii) to bring an action or suit against such Defaulting Lender in a court of competent jurisdiction to recover the defaulted amount and any related interest.  Any amounts received by the Agent in respect of a Defaulting Lender’s Loans shall be applied as set forth in §14.16(a)(ii).

 

§ 14.17  (b) Defaulting Lender Cure.  If Loan Parties and the Agent agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the 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 that Lender will, to the extent applicable, purchase that portion of outstanding Advances of the other Lenders or take such other actions as the Agent may determine to be necessary to cause the Loan to be held on a pro rata basis by the Lenders in accordance with their Commitment Percentage (without giving effect to § 14.16(a)(iv)), whereupon that 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 Loan Parties 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.

 

§ 14.18  Certain ERISA Matters.  (a)  Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of the Agent and each Arranger and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of Borrower or any other Loan Party, that at least one of the following is and will be true:

 

(i)            such Lender is not using “plan assets” of one or more Benefit Plans in connection with the Advances or the Commitments,

 

(ii)           the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset  managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Obligations of such Lender in respect of the Advances, the Commitments and this Agreement, or

 

(iii)          (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Obligations of such Lender in respect of the Advances, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Obligations of such Lender in respect of the Advances, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Obligations of such Lender in respect of the Advances, the Commitments and this Agreement.

 

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(b)           In addition, unless sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender, such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of each Agent and each Arranger and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of Borrower or any other Loan Party, that:

 

(i)            none of the Agent, the Arrangers or their respective Affiliates is a fiduciary with respect to the assets of such Lender (including in connection with the reservation or exercise of any rights by any Agent under this Agreement, any Loan Document or any documents related to hereto or thereto),

 

(ii)           the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Obligations of such Lender in respect of the Advances, the Commitments and this Agreement is independent (within the meaning of 29 CFR § 2510.3-21) and is a bank, an insurance carrier, an investment adviser, a broker-dealer or other person that has under management or control, total assets of at least $50 million, in each case as described in 29 CFR § 2510.3-21(c)(1)(A)-(E),

 

(iii)          the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Obligations of such Lender in respect of the Advances, the Commitments and this Agreement is capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies,

 

(iv)          the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Obligations of such Lender in respect of the Advances, the Commitments and this Agreement is a fiduciary under ERISA or the Code, or both, with respect to the Advances, the Commitments and this Agreement and is responsible for exercising independent judgment in evaluating the transactions hereunder, and

 

(v)           no fee or other compensation is being paid by such Lender or any of its Affiliates or agents directly to the Agent, any Arranger or any of their respective Affiliates for investment advice (as opposed to other services) in connection with the Advances, the Commitments or this Agreement.

 

The Agent and each Arranger hereby informs the Lenders that each such Person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the transactions contemplated hereby, and that such Person has a financial interest in the transactions contemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Advances, the Commitments and this Agreement, (ii) may recognize a gain if it extended the Advances or the Commitments for an amount less than the amount being paid for an interest in the Advances or the Commitments by such Lender or (iii) may receive fees or other payments in connection with the transactions contemplated hereby, the Loan Documents or otherwise, including, without limitation, structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees, administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums, banker’s acceptance fees, breakage or other early termination fees or fees similar to the foregoing.

 

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SECTION 15

 

EXPENSES

 

Borrower agrees to pay, (a) to the extent incurred by Agent (a) the reasonable costs of producing and reproducing this Agreement, the other Loan Documents and the other agreements and instruments mentioned herein, (b) all engineer’s fees, environmental reviews and the reasonable fees, expenses and disbursements of the counsel to the Agent and any local counsel to the Agent incurred in connection with the preparation, administration, or interpretation of the Loan Documents and other instruments mentioned herein, and amendments, modifications, approvals, consents or waivers hereto or hereunder, (c) all other reasonable out of pocket fees, expenses and disbursements (other than Taxes unless such payment is otherwise required pursuant to the terms of this Agreement) of the Agent incurred by the Agent in connection with the preparation or interpretation of the Loan Documents and other instruments mentioned herein, the addition or substitution of additional Eligible Real Estate Assets, the review of leases, the making of each Advance hereunder, and the third party out-of-pocket costs and expenses incurred in connection with the syndication of the Commitments pursuant to § 18 hereof, and (d) without duplication, all out-of-pocket expenses (including reasonable attorneys’ fees and costs, and the fees and costs of appraisers, engineers, investment bankers or other experts retained by any Lender or the Agent) incurred by any Lender or the Agent in connection with (i) the enforcement of or preservation of rights under any of the Loan Documents against Loan Parties or the administration thereof after the occurrence of a Default or Event of Default and (ii) any litigation, proceeding or dispute whether arising hereunder or otherwise, in any way related to the Agent’s or any of the Lenders’ relationship with Loan Parties (provided that any attorneys’ fees and costs pursuant to this clause (d) shall be limited to those incurred by the Agent and one other counsel with respect to the Lenders as a group and an additional counsel in the event of an actual or perceived conflict of interest), (e) all reasonable out-of-pocket fees, expenses and disbursements (including reasonable attorneys’ fees and costs) which may be incurred by the Agent in connection with the execution and delivery of this Agreement and the other Loan Documents (without duplication of any of the items listed above), and (f) all expenses relating to the use of Intralinks, SyndTrak or any other similar system for the dissemination and sharing of documents and information in connection with the Loan.  The covenants of this § 15 shall survive the repayment of the Loan and the termination of the obligations of the Lenders hereunder.

 

SECTION 16

 

INDEMNIFICATION

 

Borrower agrees to indemnify and hold harmless the Agent, the Lenders and the Arrangers and each director, officer, employee, agent and Affiliate thereof and Person who controls the Agent or any Lender or the Arrangers against any and all claims, actions and suits, whether groundless or otherwise, and from and against any and all liabilities, losses, damages and expenses of every nature and character arising out of or relating to any claim, action, suit or litigation arising out of this Agreement or any of the other Loan Documents or the transactions contemplated hereby and thereby including, without limitation, (a) any and all claims for brokerage, leasing, finders or similar fees which may be made relating to the Eligible Real Estate Assets or the Loan by parties claiming by or through Loan Parties, (b) any condition of the Eligible Real Estate Assets or any other Real Estate, (c) any actual or proposed use by Loan Parties of the proceeds of any of the Advances, (d) any actual or alleged infringement of any patent, copyright, trademark, service mark or similar right of Loan Parties, (e) Loan Parties entering into or performing this Agreement or any of the other Loan Documents, (f) any actual or alleged violation of any law, ordinance, code, order, rule, regulation, approval, consent, permit or license relating to the Eligible Real Estate Assets or any other Real Estate, (g) with respect to Loan Parties and their respective properties and assets the violation of any Environmental Law, the Release or threatened Release of any Hazardous Substances or any action, suit, proceeding or investigation brought or threatened with respect to any Hazardous Substances (including, but not limited to, claims with respect to wrongful death, personal injury, nuisance or damage to property), and (h) to the extent used by Loan Parties, any use of Intralinks, SyndTrak or any other system for the dissemination and sharing of documents and information, in 

 

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each case including, without limitation, the reasonable fees and disbursements of counsel incurred in connection with any such investigation, litigation or other proceeding; provided, however, that Borrower shall not be obligated under this § 16 or otherwise to indemnify any Person for liabilities arising from such Person’s own gross negligence or willful misconduct as determined by a court of competent jurisdiction after the exhaustion of all applicable appeal periods.  In litigation, or the preparation therefor, the Lenders and the Agent shall be entitled to select a single law firm as their own counsel (and an additional counsel in the event of an actual or perceived conflict of interest) and, in addition to the foregoing indemnity, Borrower agrees to pay promptly the reasonable fees and expenses of such counsel.  No person indemnified hereunder shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.  If, and to the extent that the obligations of Borrower under this § 16 are unenforceable for any reason, Borrower hereby agrees to make the maximum contribution to the payment in satisfaction of such obligations which is permissible under applicable law.  The provisions of this § 16 shall survive the repayment of the Loan and the termination of the obligations of the Lenders hereunder.  Notwithstanding the foregoing, the provisions of this Section 16 shall not apply with respect to Taxes, other than any Taxes that represent losses, claims or damages arising from any non-Tax claim.

 

 

SECTION 17

 

SURVIVAL OF COVENANTS, ETC.

 

All covenants, agreements, representations and warranties made herein, in the Notes, in any of the other Loan Documents or in any documents or other papers delivered by or on behalf of Loan Parties or any of their respective Subsidiaries pursuant hereto or thereto shall be deemed to have been relied upon by the Lenders and the Agent, notwithstanding any investigation heretofore or hereafter made by any of them, and shall survive the making by the Lenders of any Advances, as herein contemplated, and shall continue in full force and effect so long as any amount due under this Agreement or the Notes or any of the other Loan Documents remains outstanding or any Lender has any obligation to make any Advance.  The indemnification obligations of Loan Parties provided herein and in the other Loan Documents shall survive the full repayment of amounts due and the termination of the obligations of the Lenders hereunder and thereunder to the extent provided herein and therein.  All statements contained in any certificate delivered to any Lender or the Agent at any time by or on behalf of Loan Parties or any of their respective Subsidiaries pursuant hereto or in connection with the transactions contemplated hereby shall constitute representations and warranties by such Person hereunder.

 

SECTION 18

 

ASSIGNMENT AND PARTICIPATION

 

§ 18.1     Conditions to Assignment by Lenders.  Except as provided herein, each Lender may assign to one or more Eligible Assignees all or a portion of its interests, rights and obligations under this Agreement (including all or a portion of its Commitment Percentage and Commitment and the same portion of the Loan at the time owing to it and the Notes held by it); provided that (a) the Agent and, unless an Event of Default has occurred and is continuing at the time of any such assignment, Borrower, shall have each given its respective prior written consent to such assignment, which consent in each case shall not be unreasonably withheld or delayed, and shall not be required if such assignment is to an Approved Fund, an existing Lender or a Lender Affiliate, (b) each such assignment shall be of a constant, and not a varying, percentage of all the assigning Lender’s rights and obligations under this Agreement with respect to the Commitment in the event an interest in the Loan is assigned, (c) the parties to such assignment shall execute and deliver to the Agent, for recording in the Register (as hereinafter defined) an Assignment and Acceptance Agreement in the form of Exhibit F annexed hereto, together with any Notes subject to such assignment, (d) in no event shall any assignment be to any Person controlling, controlled by or under common control with, or which is not 

 

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otherwise free from influence or control by, any Loan Party or REIT, (e) such assignee shall acquire an interest in the Loan of not less than $5,000,000 and integral multiples of $1,000,000 in excess thereof (or if less, the remaining portion of the Loan held by the assignor), unless waived by the Agent, and so long as no Default or Event of Default exists hereunder, Borrower, (f) in no event shall any assignment be to a natural person, and (g) no assignment shall be permitted without the prior written consent of the Agent until the earlier of the date (i) which is thirty (30) days after the Closing Date, or (ii) that the Agent shall have notified the Lenders that syndication of the Commitments hereunder has been completed.  Upon execution, delivery, acceptance and recording of such Assignment and Acceptance Agreement, (i) the assignee thereunder shall be a party hereto and all other Loan Documents executed by the Lenders and, to the extent provided in such Assignment and Acceptance Agreement, have the rights and obligations of a Lender hereunder, (ii) the assigning Lender shall, upon payment to the Agent of the registration fee referred to in § 18.2, be released from its obligations under this Agreement arising after the effective date of such assignment with respect to the assigned portion of its interests, rights and obligations under this Agreement, and (iii) the Agent may unilaterally amend Schedule 1.1 to reflect such assignment.  In connection with each assignment, the assignee shall represent and warrant to the Agent, the assignor and each other Lender as to whether such assignee is controlling, controlled by, under common control with or is not otherwise free from influence or control by, Loan Parties and REIT.

 

§ 18.2     Register.  The Agent shall maintain on behalf of Loan Parties a copy of each assignment delivered to it and a register or similar list (the “Register”) for the recordation of the names and addresses of the Lenders and the Commitment Percentages of and principal amount of and interest on the Loan owing to the Lenders from time to time.  The entries in the Register shall be conclusive, in the absence of manifest error, and Loan Parties, the Agent and the Lenders may treat each Person whose name is recorded in the Register as a Lender hereunder for all purposes, notwithstanding notice to the contrary.  The Register shall be available for inspection by Loan Parties and the Lenders at any reasonable time and from time to time upon reasonable prior notice.  Upon each such recordation, the assigning Lender agrees to pay to the Agent a registration fee in the sum of $3,500, which the Agent may, in its sole discretion, elect to waive in the case of any assignment.

 

§ 18.3     New Notes.  Upon its receipt of an Assignment and Acceptance Agreement executed by the parties to such assignment, together with each Note subject to such assignment, the Agent shall record the information contained therein in the Register.  Within five (5) Business Days after receipt of notice of such assignment from the Agent, Borrower, at its own expense, shall execute and deliver to the Agent, in exchange for each surrendered Note, a new Note (if requested by the subject Lender) to the order of such assignee in an amount equal to the amount assigned to such assignee pursuant to such Assignment and Acceptance Agreement and, if the assigning Lender has retained some portion of its obligations hereunder, a new Note to the order of the assigning Lender in an amount equal to the amount retained by it hereunder.  Such new Notes shall provide that they are replacements for the surrendered Notes, shall be in an aggregate principal amount equal to the aggregate principal amount of the surrendered Notes, shall be dated the effective date of such Assignment and Acceptance Agreement and shall otherwise be in substantially the form of the assigned Notes.  The surrendered Notes shall be canceled and returned to Borrower.

 

§ 18.4     Participations.  Any Lender may at any time, without the consent of, or notice to, Loan Parties or the Agent, sell participations to any Person (other than a natural person, a Defaulting Lender or Loan Parties or any Loan Party’s Affiliates or Subsidiaries) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the portion of the Loan owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) Loan Parties, the Agent and the Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any  provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification 

 

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described in § 27(a), (b), (c) or (h) that affects such Participant.  Loan Parties agree that each Participant shall be entitled to the benefits of §§ 4.4, 4.9 and 4.10 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to § 18.1; provided a Participant shall not be entitled to receive any greater payment under §§ 4.9 and 4.10 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with Borrower’s prior written consent.  To the extent permitted by law, each Participant also shall be entitled to the benefits of § 13 as though it were a Lender, provided such Participant agrees to be subject to § 13 as though it were a Lender.  Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts of (and stated interest on) each Participant’s interest in the Loan or other Obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any Commitment, the Loan or its other Obligations under any Loan Document) to any Person, except to the extent that such disclosure is necessary to establish that such Commitment, Loan or other Obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations, proposed Section 1.163-5(b) of the United States Treasury Regulations and any amended, replacement or successor authority.  The entries in the Participant Register shall be conclusive absent manifest error, and such Lender 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.  For the avoidance of doubt, the Agent (in its capacity as Agent) shall have no responsibility for maintaining a Participant Register.

 

§ 18.5     Pledge by Lender.  Notwithstanding any other provision set forth in this Agreement, any Lender may at any time create a security interest in all or any portion of its rights under this Agreement (including, without limitation, the Advances owing to it and the Note or Notes held by it, if any), including in favor of any Federal Reserve Bank in accordance with Regulation A of the Board of Governors of the Federal Reserve System or the central bank of any country in which such Lender is organized.  No such pledge or the enforcement thereof shall release the pledgor Lender from its obligations hereunder or under any of the other Loan Documents.

 

§ 18.6     No Assignment by Borrower.  Borrower shall not assign or transfer any of its rights or obligations under this Agreement without the prior written consent of each of the Lenders.

 

§ 18.7     Disclosure.  Each of the Agents, the Arrangers and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential and provided further that such Persons who are not employees of such Affiliate are advised of the provision of this §18.7 and sign a confidentiality agreement reasonably acceptable to Loan Parties), (b) to the extent requested by any regulatory authority purporting to have jurisdiction over it (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, it being understood that in the event that Agents, Arrangers and Lenders are requested or required by law or regulations to disclose any of the Information, they shall provide Loan Parties with prompt written notice, unless such notice is prohibited by law, of any such request or requirement so that Loan Parties may seek a protective order or other appropriate remedy, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to a confidentiality agreement containing provisions at least as restrictive as those of this Section, (i) to any assignee of or Participant in, or any prospective assignee of or participant in, any of its rights or obligations under this Agreement and (ii) to any actual or prospective party (or its managers, administrators, trustees, partners, directors, officers, employees, agents, advisors and other representatives, provided that such Persons who are 

 

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not employees of such prospective party are also advised of the provision of this §18.7 and sign a confidentiality agreement reasonably acceptable to Loan Parties) to any swap, derivative or other transaction under which payments are to be made by reference to Loan Parties and their obligations, this Agreement or payments hereunder, (g) to any rating agency, (h) to the CUSIP Service Bureau or any similar organization, (i) with the consent of Borrower, (j) to external auditors as may be required by a Lender’s policies or policies of any governmental or quasi governmentalquasi-governmental entity affecting a Lender, or (k) to the extent such Information (i) becomes publicly available other than as a result of a breach of this § 18.7 or (ii) becomes available to the Agent, such Arranger or such Lender or any of their respective Affiliates on a non-confidential basis from a source other than any Loan Party or any of their Subsidiaries without the Agent, such Arranger or such Lender or any of their respective Affiliates having knowledge that a duty of confidentiality to Loan Parties or any of their Subsidiaries has been breached.  In addition, the Agent, Arrangers and Lenders may disclose the existence of this Agreement and information about this Agreement to market data collectors, similar service providers to the lending industry and service providers to the Agent, Arrangers and Lenders in connection with the administration of this Agreement, the other Loan Documents, and the Commitments. For purposes of this Section, “Information” means all information that any Loan Party furnishes to the Agent, any Arranger or any Lender in writing designated as confidential, but does not include any such information that is or becomes generally available to the public other than by way of a breach of the confidentiality provisions of this § 18.7 or that is or becomes available to the Agent, such Arranger or such Lender from a source other than Loan Parties, the Agent, the Arranger or any Lender and not in violation of any confidentiality agreement with respect to such information that is actually known to the Agent, such Arranger or such Lender.  Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

 

§ 18.8     Titled Agents.  The Titled Agents shall not have any additional rights or obligations under the Loan Documents, except for those rights, if any, as a Lender.

 

§ 18.9     Mandatory Assignment.  In the event Borrower requests that any amendment, modification or waiver be made to this Agreement or any of the other Loan Documents which request is approved by the Agent but is not approved by one or more of the Lenders or such Lender fails to respond within ten (10) days after the first date on which such consent was solicited in writing from the Lenders by the Agent (any such non-consenting or non-responding Lender shall hereafter be referred to as the “Non-Consenting Lender”), then, within thirty (30) days after the expiration of such ten (10) day period (or, if earlier, Borrower’s receipt of notice of such disapproval by such Non-Consenting Lender), Borrower shall have the right as to such Non-Consenting Lender, to be exercised by delivery of written notice delivered to the Agent and the Non-Consenting Lender within thirty (30) days of the earlier of expiration of such period or receipt of such notice, to elect to cause the Non-Consenting Lender to transfer all of its interests, rights and obligations under this Agreement (including all of its Commitment Percentage and Commitment and the same portion of the Loan at the time owing to it and the Notes held by it) (collectively, the “Transferred Interest”) to a Lender or a Replacement Lender.  The Agent shall promptly (but in any event, no later than five (5) Business Days after receipt of such notice from Borrower) notify the remaining Lenders (each such notice, the “Lender Offer Notice”) that each of such Lenders shall have the right, but not the obligation, to acquire a portion of the Transferred Interest, pro rata based upon their relevant Commitment Percentages, of the Non-Consenting Lender (or if any of such Lenders does not elect to purchase its pro rata share, then to such remaining Lenders in such proportion as approved by the Agent).  In the event that the Lenders do not elect to acquire all of the Non-Consenting Lender’s Transferred Interest within ten (10) Business Days of receipt of the Lender Offer Notice, then Borrower may endeavor to find a new Lender or Lenders to acquire such remaining portion of the Transferred Interest, such Lender or Lenders to be subject to the approval of the Agent, such approval not to be unreasonably withheld (such Lender, the “Replacement Lender”).  Upon any such purchase of the Transferred Interest of the Non-Consenting Lender, the Non-Consenting Lender’s interests in the Obligations and its rights hereunder and under the Loan Documents shall terminate at the date of purchase, and the Non-Consenting Lender shall promptly execute and deliver any and all documents reasonably requested by the Agent to surrender and transfer such Transferred Interest, including, without limitation, an Assignment and Acceptance 

 

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Agreement and such Non-Consenting Lender’s original Note (if any).  Notwithstanding anything in this § 18.10 to the contrary, any Lender or other Lender assignee acquiring some or all of the Transferred Interest of the Non-Consenting Lender must consent to the proposed amendment, modification or waiver.  The purchase price to be paid by the acquiring Lenders for the Non-Consenting Lender’s Transferred Interest shall equal the principal owed to such Non-Consenting Lender, and Borrower shall pay to such Non-Consenting Lender in addition thereto and as a condition to such sale any and all other amounts outstanding and owed by Loan Parties to the Non-Consenting Lender hereunder or under any of the other Loan Documents, including all accrued and unpaid interest or fees which would be owed to such Non-Consenting Lender hereunder or under any of the other Loan Documents if the Loan were to be repaid in full on the date of such purchase of the Non-Consenting Lender’s Transferred Interest.  No registration fee under § 18.2 shall be required in connection with such assignment.  If such Non-Consenting Lender does not execute and deliver to the Agent a duly completed Assignment and Acceptance and/or any other documentation necessary to reflect such replacement within a period of time deemed reasonable by the Agent (but in any event, no later than five (5) Business Days) after the later of (i) the date on which the Replacement Lender executes and delivers such Assignment and Acceptance and/or such other documentation and (ii) the date on which the Non-Consenting Lender receives all payments required to be paid to it by this § 18.10, then such Non-Consenting Lender shall be deemed to have executed and delivered such Assignment and Acceptance and/or such other documentation as of such date and Borrower shall be entitled (but not obligated) to execute and deliver such Assignment and Acceptance and/or such other documentation on behalf of such assigning Lender.

 

SECTION 19

 

NOTICES

 

Each notice, demand, election or request (hereinafter in this § 19 referred to as “Notice”) must be in writing and shall be deemed to have been properly given or served by personal delivery or by sending same by overnight courier or by depositing same in the United States Mail, postpaid and registered or certified, return receipt requested, and addressed as follows:

 

If to the Agent or RBC:

 

Royal Bank of Canada
 20 King Street, 4th Floor
 Toronto, Ontario M5H 1C4

Attn:  Manager, Agency Services Group
 Telecopy No.:  (416) 842-4023

 

With a copy to:

 

Shearman & Sterling LLP
 599 Lexington Avenue
 New York, New York  10022

Attn:  Malcolm K. Montgomery, Esq.  
 Telecopy No.:  (646) 848-7587

 

If to Loan Parties:

 

CoreSite L.P.
 1001 17th Street, Suite 500

Denver, CO  80202

Attn:       Mr. Adam Post

Telecopy No.:  (855) 232-0594

 

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CoreSite L.P.
 1001 17th Street, Suite 500

Denver, CO  80202

Attn:       General Counsel

Telecopy No.:  (855) 232-0594

 

With a copy to:

 

Latham & Watkins LLP
 885 Third Avenue
 New York, NY 10022
 Attn:  Dara Denberg, Esquire

 

With a copy to:

 

Latham & Watkins LLP
 555 Eleventh Street, NW, Suite 1000
 Washington, DC 20004-1304
 Attn:  Jeffrey R. Chenard, Esquire

 

to any Lender which is a party hereto, at the address for such Lender set forth on its signature page hereto, and to any Lender which may hereafter become a party to this Agreement, at such address as may be designated by such Lender.  Each Notice shall be effective upon being personally delivered or upon being sent by overnight courier or upon being deposited in the United States Mail as aforesaid, or if transmitted by telegraph, telecopy, telefax or telex is permitted, upon being sent and confirmation of receipt.  The time period in which a response to such Notice must be given or any action taken with respect thereto (if any), however, shall commence to run from the date of receipt if personally delivered or sent by overnight courier, or if so deposited in the United States Mail, the earlier of three (3) Business Days following such deposit or the date of receipt as disclosed on the return receipt.  Rejection or other refusal to accept or the inability to deliver because of changed address for which no notice was given shall be deemed to be receipt of the Notice sent.  By giving at least fifteen (15) days prior Notice thereof, Loan Parties, a Lender or the Agent shall have the right from time to time and at any time during the term of this Agreement to change their respective addresses and each shall have the right to specify as its address any other address within the United States of America.  For purposes of this Agreement, delivery by Agent or any Lender of any notice to Borrower shall constitute delivery of such notice to all Loan Parties.

 

SECTION 20

 

RELATIONSHIP

 

Neither the Agent nor any Lender has any fiduciary relationship with or fiduciary duty to Loan Parties or their respective Subsidiaries arising out of or in connection with this Agreement or the other Loan Documents or the transactions contemplated hereunder and thereunder, and the relationship between each Lender and the Agent, and Loan Parties is solely that of a lender and borrower or guarantor, as applicable, and nothing contained herein or in any of the other Loan Documents shall in any manner be construed as making the parties hereto partners, joint ventures or any other relationship other than lender and borrower or guarantor.

 

SECTION 21

 

GOVERNING LAW; CONSENT TO JURISDICTION AND SERVICE

 

THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, INCLUDING, WITHOUT LIMITATION, NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1401.  BORROWER, THE AGENT AND THE LENDERS AGREE THAT ANY SUIT 

 

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FOR THE ENFORCEMENT OF THIS AGREEMENT SHALL BE BROUGHT IN ANY COURT OF COMPETENT JURISDICTION IN THE STATE AND COUNTY OF NEW YORK (INCLUDING ANY FEDERAL COURT SITTING THEREIN) SITTING IN NEW YORK COUNTY, AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF.  BORROWER, THE AGENT AND THE LENDERS FURTHER ACCEPT, GENERALLY AND UNCONDITIONALLY, THE EXCLUSIVE JURISDICTION OF SUCH COURTS AND ANY RELATED APPELLATE COURT AND IRREVOCABLY (i) AGREE TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY WITH RESPECT TO THIS AGREEMENT AND (ii) WAIVE ANY OBJECTION ANY OF THEM MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH A COURT IS AN INCONVENIENT FORUM.  BORROWER, THE AGENT AND THE LENDERS FURTHER AGREE THAT SERVICE OF PROCESS IN ANY SUCH SUIT MAY BE MADE UPON BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN § 19 HEREOF.  NOTWITHSTANDING THE FOREGOING, IN ADDITION TO THE COURTS OF THE STATE OF NEW YORK OR ANY FEDERAL COURT SITTING THEREIN, THE AGENT OR ANY LENDER MAY BRING ACTION(S) FOR ENFORCEMENT ON A NONEXCLUSIVE BASIS WHERE ANY ASSETS OF BORROWER EXIST AND BORROWER CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURTS AND THE SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON BORROWER BY MAIL AT THE ADDRESS SPECIFIED IN § 19 HEREOF.

 

SECTION 22

 

HEADINGS

 

The captions in this Agreement are for convenience of reference only and shall not define or limit the provisions hereof.

 

SECTION 23

 

COUNTERPARTS

 

This Agreement and any amendment hereof may be executed in several counterparts and by each party on a separate counterpart, each of which when so executed and delivered shall be an original, and all of which together shall constitute one instrument.  In proving this Agreement it shall not be necessary to produce or account for more than one such counterpart signed by the party against whom enforcement is sought.  Delivery of an executed counterpart of a signature page to this Agreement by telecopier or by email with a pdf or similar attachment shall be effective as delivery of an original executed counterpart of this Agreement.

 

SECTION 24

 

ENTIRE AGREEMENT, ETC.

 

This Agreement and the Loan Documents is intended by the parties as the final, complete and exclusive statement of the transactions evidenced by this Agreement and the Loan Documents.  All prior or contemporaneous promises, agreements and understandings, whether oral or written, are deemed to be superseded by this Agreement and the Loan Documents, and no party is relying on any promise, agreement or understanding not set forth in this Agreement and the Loan Documents.  Neither this Agreement nor any term hereof may be changed, waived, discharged or terminated, except as provided in § 27.

 

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SECTION 25

 

WAIVER OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS

 

EACH OF BORROWER, THE AGENT AND THE LENDERS HEREBY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS AGREEMENT, ANY NOTE OR ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.  BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY SUCH LITIGATION ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, PUNITIVE OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES.  BORROWER (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY LENDER OR THE AGENT HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH LENDER OR THE AGENT WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS AND (B) ACKNOWLEDGES THAT THE AGENT AND THE LENDERS HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH THEY ARE PARTIES BY, AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS CONTAINED IN THIS § 25.  BORROWER ACKNOWLEDGES THAT IT HAS HAD AN OPPORTUNITY TO REVIEW THIS § 25 WITH LEGAL COUNSEL AND THAT BORROWER AGREES TO THE FOREGOING AS ITS FREE, KNOWING AND VOLUNTARY ACT.

 

SECTION 26

 

DEALINGS WITH LOAN PARTIES

 

The Agent, the Lenders and their affiliates may accept deposits from, extend credit to, invest in, act as trustee under indentures of, serve as financial advisor of, and generally engage in any kind of banking, trust or other business with Loan Parties and their respective Subsidiaries or any of their Affiliates regardless of the capacity of the Agent or the Lender hereunder.  The Lenders acknowledge that, pursuant to such activities, RBC or its Affiliates may receive information regarding such Persons (including information that may be subject to confidentiality obligations in favor of such Person) and acknowledge that the Agent shall be under no obligation to provide such information to them.

 

SECTION 27

 

CONSENTS, AMENDMENTS, WAIVERS, ETC.

 

§ 27.1     Amendments Generally.  Except as otherwise expressly provided in this Agreement, any consent or approval required or permitted by this Agreement may be given, and any term of this Agreement or of any other instrument related hereto or mentioned herein may be amended, and the performance or observance by Borrower of any terms of this Agreement or such other instrument or the continuance of any Default or Event of Default may be waived (either generally or in a particular instance and either retroactively or prospectively) with, but only with, the written consent of the Required Lenders, which consent, approval or waiver (as applicable), or other action permitted to be taken by the Required Lenders hereunder, shall be binding on the Agent (subject to §14.10) and the Lenders.  Notwithstanding the foregoing, no such amendment, waiver or consent shall result in:  (a) a reduction in the rate of interest on the Notes (other than a reduction or waiver of default interest) without the written consent of each Lender entitled to receive such amount; provided, however, that for the avoidance of doubt, an amendment to any financial covenant hereunder (or any defined term used therein), even if the effect of such amendment would be to reduce the rate of interest on any Advance, shall require the consent of the Required Lenders; (b) an increase in the amount of 

 

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the Commitment of any Lender without the written consent of such Lender; (c) a forgiveness, reduction, or waiver of the principal of any unpaid Advance or any interest thereon or fee payable under the Loan Documents due to the Lenders (or any of them) (other than a reduction or waiver of default interest) without the written consent of each Lender entitled to receive such payment; provided, however, that for the avoidance of doubt, an amendment to any financial covenant hereunder (or any defined term used therein), even if the effect of such amendment would be to reduce the rate of interest on any Advance or reduce any fee payable hereunder, shall require the written consent of the Required Lenders; (d) a change in the amount of any fee payable to a Lender hereunder without the written consent of each Lender entitled to receive such payment; (e) the postponement of any date fixed for any payment of principal of or interest on the Loan or fee payable under the Loan Documents due to the Lenders (or any of them) without the written consent of each Lender entitled to receive such payment; (f) an extension of the Maturity Date with respect to the Commitment and Advances of any Lender without the written consent of such Lender; (g) a change in the manner of distribution of any payments to the Lenders or the Agent without the written consent of each Lender directly and adversely affected thereby; (h) the release of Borrower or any Subsidiary Guarantor except as otherwise provided in §5.2 or §5.4; (i) an amendment of the definition of Required Lenders or of any requirement for consent by all of the Lenders without the written consent of all Lenders; (j) any modification to require a Lender to fund a pro rata share of a request for an advance of the Loan made by Borrower other than based on its Commitment Percentage without the written consent of all Lenders; (k) an amendment to this § 27 without the written consent of all Lenders; (l) an amendment or modification to the definition of Unencumbered Asset Pool Availability (or any defined term referenced therein) which would result in an increase in availability derived from Leased Assets without the written consent of all Lenders; or (m) an amendment of any provision of this Agreement or the Loan Documents which requires the approval of all of the Lenders or the Required Lenders to require a lesser number of Lenders to approve such action without the written consent of all Lenders.  The provisions of § 14 may not be amended without the written consent of the Agent.  No waiver shall extend to or affect any obligation not expressly waived or impair any right consequent thereon.  No course of dealing or delay or omission on the part of the Agent or any Lender in exercising any right shall operate as a waiver thereof or otherwise be prejudicial thereto.  Notwithstanding anything to the contrary herein, 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 Commitment 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.

 

§ 27.2     Technical Amendments.  Notwithstanding anything to the contrary in this Agreement, including this §27, this Agreement may be amended by Borrower and the Agent to provide for any Commitment Increase in the manner contemplated by §2.11.  Notwithstanding anything to the contrary in this §27, if the Agent and Borrower have jointly identified an ambiguity, omission, mistake or defect in any provision of this Agreement or an inconsistency between provisions of this Agreement, the Agent and Borrower shall be permitted to amend such provision or provisions to cure such ambiguity, omission, mistake, defect or inconsistency so long as to do so would not materially adversely affect the interests of the Lenders.  Any such amendment shall  become effective without any further action or consent of any of other party to this Agreement.  The Agent shall provide a copy of each such amendment to the Lenders promptly after execution thereof.

 

§ 27.3     Revolver Provisions.  The provisions in §§ 5.1 through 5.4, § 6, §§ 7.2 through 7.22, § 8, § 9 and § 12.1 of this Agreement, including, in each case, any associated definitions in § 1.1, contain essentially the same provisions with respect to REIT, Loan Parties and their Subsidiaries as those contained in §§ 5.1 through 5.4, § 6,  §§ 7.2 through 7.22, § 8, § 9 and § 12.1 of the Existing Credit Agreement and in the associated definitions in the Existing Credit Agreement (the “Revolver Provisions”).  In the event that there is (x) an approval by the “Required Lenders” (as defined in the Existing Credit Agreement) of the addition of Eligible Real Estate in the calculation of Unencumbered Asset Pool Value which does not meet one or more of 

 

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the Unencumbered Property conditions set forth in § 5.1, or (y) a proposal to modify, waive or restate, or request a consent or approval with respect to, the Revolver Provisions (including any associated definitions) of the Existing Credit Agreement in writing (which may include a written waiver of an existing actual or potential default or event of default that is intended to be eliminated by such modification, restatement or waiver) (each of the foregoing in clauses (x) and (y), a “Proposed Modification”), then (A) any Lender under this Agreement shall be deemed to have automatically approved the Proposed Modification hereunder of any corresponding Revolver Provisions contained in this Agreement for purposes of determining if the requisite approvals hereunder have been obtained if such Lender or an Affiliate of such Lender approved the Proposed Modification under the Existing Credit Agreement in its capacity as a “Lender” under the Existing Credit Agreement and (B) in the case that the Lenders under this Agreement described in clause (A) above constitute the Required Lenders hereunder, then simultaneously with the agreement to or granting of such Proposed Modification under the Existing Credit Agreement, this Agreement shall be deemed modified or restated, or such waiver, consent or approval granted, in a manner consistent with the Proposed Modifications under the Existing Credit Agreement, unless such modification, restatement, waiver, consent or approval requires the consent of each Lender or each Lender directly and adversely affected thereby under the terms of this § 27.  If requested by Borrower or the Agent, Borrower, REIT, Loan Parties and each approving Lender (including any Lender deemed to have approved pursuant to this § 27) shall execute and deliver a written amendment to, restatement of, or waiver, consent or approval under, this Agreement memorializing such modification, restatement, waiver, consent or approval.

 

SECTION 28

 

SEVERABILITY

 

The provisions of this Agreement are severable, and if any one clause or provision hereof shall be held invalid or unenforceable in whole or in part in any jurisdiction, then such invalidity or unenforceability shall affect only such clause or provision, or part thereof, in such jurisdiction, and shall not in any manner affect such clause or provision in any other jurisdiction, or any other clause or provision of this Agreement in any jurisdiction.

 

SECTION 29

 

TIME OF THE ESSENCE

 

Time is of the essence with respect to each and every covenant, agreement and obligation of Loan Parties under this Agreement and the other Loan Documents.

 

SECTION 30

 

NO UNWRITTEN AGREEMENTS

 

THE LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,  CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.  ANY ADDITIONAL TERMS OF THE AGREEMENT BETWEEN THE PARTIES ARE SET FORTH BELOW.

 

SECTION 31

 

REPLACEMENT NOTES

 

Upon receipt of evidence reasonably satisfactory to Borrower of the loss, theft, destruction or mutilation of any Note, and in the case of any such loss, theft or destruction, upon delivery of an indemnity 

 

98

 

agreement reasonably satisfactory to Borrower or, in the case of any such mutilation, upon surrender and cancellation of the applicable Note, Borrower will execute and deliver, in lieu thereof, a replacement Note, identical in form and substance to the applicable Note and dated as of the date of the applicable Note and upon such execution and delivery all references in the Loan Documents to such Note shall be deemed to refer to such replacement Note.

 

SECTION 32

 

NO THIRD PARTIES BENEFITED

 

This Agreement and the other Loan Documents are made and entered into for the sole protection and legal benefit of Loan Parties, the Lenders, the Agent and their permitted successors and assigns, and no other Person shall be a direct or indirect legal beneficiary of, or have any direct or indirect cause of action or claim in connection with, this Agreement or any of the other Loan Documents.  All conditions to the performance of the obligations of the Agent and the Lenders under this Agreement, including the obligation to make Advances, are imposed solely and exclusively for the benefit of the Agent and the Lenders and no other Person shall have standing to require satisfaction of such conditions in accordance with their terms or be entitled to assume that the Agent and the Lenders will refuse to make Advances in the absence of strict compliance with any or all thereof and no other Person shall, under any circumstances, be deemed to be a beneficiary of such conditions, any and all of which may be freely waived in whole or in part by the Agent and the Lenders at any time if in their sole discretion they deem it desirable to do so.  In particular, the Agent and the Lenders make no representations and assume no obligations as to third parties concerning the quality of the construction by Loan Parties or any of their Subsidiaries of any development or the absence therefrom of defects.

 

SECTION 33

 

PATRIOT ACT

 

Each Lender and the Agent (for itself and not on behalf of any Lender) hereby notifies Loan Parties that, pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies Loan Parties, which information includes names and addresses and other information that will allow such Lender or the Agent, as applicable, to identify Loan Parties in accordance with the Patriot Act.

 

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SECTION 34

 

[INTENTIONALLY OMITTEDINTENTIONALLY OMITTED.]

 

SECTION 35

 

[INTENTIONALLY OMITTED]

 

SECTION 36

 

[INTENTIONALLY OMITTED]

 

SECTION 37

 

[INTENTIONALLY OMITTED]

 

SECTION 38

 

ACKNOWLEDGMENT 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 acknowledges that any liability of any Lender that is an EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the writedown and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

 

(i)            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 Lender that is an EEA Financial Institution; and

 

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

 

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

 

(B)          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

 

(C)          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.

 

[Balance of page intentionally left blank.]

 

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ANNEX B

 

[Attached.]

 

 

THIS SECOND AMENDED AND RESTATED GUARANTY AMENDS, RESTATES AND REPLACES IN ITS ENTIRETY THAT CERTAIN AMENDED AND RESTATED GUARANTY GIVEN BY CORESITE REALTY CORPORATION AND CERTAIN OF ITS AFFILIATES AND SUBSIDIARIES IN FAVOR OF ROYAL BANK OF CANADA AS ADMINISTRATIVE AGENT DATED JUNE 15, 2016

 

SECOND AMENDED AND RESTATED GUARANTY

 

THIS SECOND AMENDED AND RESTATED GUARANTY dated as of April 19, 2017 (this “Guaranty”), executed and delivered by each of the undersigned (together with any other Person that may join in this Guaranty from time to time as an “Additional Subsidiary Guarantor” pursuant to Section 22, each a “Guarantor”, and collectively, the “GuarantorGuarantors”), in favor of (a) ROYAL BANK OF CANADA, in its capacity as Administrative Agent (the “Agent”) for the Lenders under that certain Amended and Restated Term Loan Agreement, dated as of April 19, 2017, by and among CORESITE L.P., a Delaware limited partnership (“Borrower”), the financial institutions party thereto and their assignees in accordance therewith (the “Lenders”), and the Agent, (as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with its terms, the “Loan Agreement”) and (b) the Lenders.  Capitalized terms used herein and not otherwise defined herein shall have the meanings set forth in the Loan Agreement.

 

WHEREAS, pursuant to the Loan Agreement, the Lenders have made available to Borrower certain financial accommodations on the terms and conditions set forth in the Loan Agreement;

 

WHEREAS, Borrower and each Guarantor, through separate legal entities, are mutually dependent on each other in the conduct of their respective businesses as an integrated operation and have determined it to be in their mutual best interests to obtain financing from the Agent and the Lenders through their collective efforts;

 

WHEREAS, each Guarantor acknowledges that it will receive direct and indirect benefits from the Agent and the Lenders making such financial accommodations available to Borrower under the Loan Agreement and, accordingly, each Guarantor is willing to guarantee Borrower’s obligations to the Agent and the Lenders on the terms and conditions contained herein; and

 

WHEREAS, each Guarantor’s execution and delivery of this Guaranty is one of the conditions precedent to the Agent and the Lenders making, or continuing to make, such financial accommodations to Borrower.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each Guarantor, each Guarantor agrees as follows:

 

Section 1.  Guaranty.  Each Guarantor hereby jointly and severally and absolutely and unconditionally guaranties the due and punctual payment and performance of all of the following when due (collectively referred to as the “Obligations”):  (a) all indebtedness and obligations owing by Borrower to any of the Lenders or the Agent under or in connection with the Loan Agreement and, any other Loan Document and any Approved Derivatives Contract, including, without limitation, the repayment of all principal of the Loans made by the Lenders to Borrower under the Loan Agreement and the payment of all interest, fees, charges, reasonable attorneys’ fees and other amounts payable to any Lender or the Agent thereunder or in connection therewith; (b) any and all extensions, renewals, modifications, amendments or substitutions of the foregoing; and (c) all expenses, including, without limitation, reasonable attorneys’ fees and disbursements, that are incurred by the Lenders or the Agent in the enforcement of any of the foregoing or any obligation of each  

 

 

Guarantor hereunder;provided, however, that “Obligations” shall not include any indebtedness or obligations constituting Excluded Swap Obligations (as defined in the Loan Agreement).

 

Section 2.  Guaranty of Payment and Not of Collection.  This Guaranty is a guaranty of payment, and not of collection, and a debt of each Guarantor for its own account.  Accordingly, the Lenders and the Agent shall not be obligated or required before enforcing this Guaranty against any Guarantor:  (a) to pursue any right or remedy the Lenders or the Agent may have against Borrower, any other Guarantor or any other Person or commence any suit or other proceeding against Borrower, any other Guarantor or any other Person in any court or other tribunal; (b) to make any claim in a liquidation or bankruptcy of Borrower, any other Guarantor or any other Person; or (c) to make demand of Borrower, any other Guarantor or any other Person.  In this connection, each Guarantor hereby waives its right to require any holder of the Obligations to take action against Borrower as provided by any legal requirement of any Governmental Authority.

 

Section 3.  Guaranty Absolute.  Each Guarantor guarantees that the Obligations will be paid in accordance with the terms of the documents evidencing the same, regardless of any legal requirement now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of the Agent or the Lenders with respect thereto.  The liability of each Guarantor under this Guaranty shall be absolute and unconditional in accordance with its terms and shall remain in full force and effect without regard to, and shall not be released, suspended, discharged, terminated or otherwise affected by, any circumstance or occurrence whatsoever (other than the full and final payment and performance of the Obligations), including, without limitation, the following (whether or not each Guarantor consents thereto or has notice thereof):

 

(a)           (i) any change in the amount, interest rate or due date or other term of any of the Obligations; (ii) any change in the time, place or manner of payment of all or any portion of the Obligations; (iii) any amendment or waiver of, or consent to the departure from or other indulgence with respect to, the Loan Agreement, any other Loan Document, or any other document or instrument evidencing or relating to any Obligations; or (iv) any waiver, renewal, extension, addition, or supplement to, or deletion from, or any other action or inaction under or in respect of, the Loan Agreement, any of the other Loan Documents, or any other documents, instruments or agreements relating to the Obligations or any other instrument or agreement referred to therein or evidencing any Obligations or any assignment or transfer of any of the foregoing;

 

(b)           any lack of validity or enforceability of the Loan Agreement, any of the other Loan Documents, or any other document, instrument or agreement referred to therein or evidencing any Obligations or any assignment or transfer of any of the foregoing;

 

(c)           any settlement or compromise of any of the Obligations or any liability of any other party with respect to the Obligations, or any subordination of the payment of the Obligations to the payment of any other liability of Borrower;

 

(d)           any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution, liquidation or other like proceeding relating to any other Guarantor, Borrower or any other Person, or any action taken with respect to this Guaranty by any trustee or receiver, or by any court, in any such proceeding;

 

(e)           any failure of the Agent or any Lender to assert any claim or demand or to enforce or exercise any right or remedy against any Loan Party under the provisions of the Loan Agreement, any other Loan Document or otherwise or against any other party with respect to any of the Obligations;

 

(f)            (e) any act or failure to act by Borrower or any other Person which may adversely affect any Guarantor’s subrogation rights, if any, against Borrower to recover payments made under this Guaranty;

 

 

(g)           (f) any application of sums paid by Borrower or any other Person with respect to the liabilities of Borrower to the Agent or the Lenders, regardless of what liabilities of Borrower remain unpaid;

 

(h)           (g) any defect, limitation or insufficiency in the borrowing powers of Borrower or in the exercise thereof; or

 

(i)            any change in the corporate existence, structure or ownership of Borrower or any other Loan Party;

 

(j)            any statement, representation or warranty made or deemed made by or on behalf of Borrower, any Guarantor or any other Loan Party under any Loan Document or any amendment hereto or thereto, proves to have been incorrect or misleading in any respect; or

 

(k)           (h) any other circumstance which might otherwise constitute a defense available to, or a discharge of, any Guarantor hereunder.

 

Section 4.  Action with Respect to Obligations.  The Lenders and the Agent may in accordance with the Loan Agreement, at any time and from time to time, without the consent of, or notice to, any Guarantor, and without discharging any Guarantor from its obligations hereunder take any and all actions described in Section 3 and may otherwise:  (a) amend, modify, alter or supplement the terms of any of the Obligations, including, but not limited to, extending or shortening the time of payment of any of the Obligations or the interest rate that may accrue on any of the Obligations; (b) amend, modify, alter or supplement the Loan Agreement or any other Loan Document; (c) release any Person liable in any manner for the payment or collection of the Obligations; (d) exercise, or refrain from exercising, any rights against Borrower or any other Person (including, without limitation, any other Guarantor); and (e) apply any sum, by whomsoever paid or however realized, to the Obligations in such order as the Lenders or the Agent shall elect in accordance with the Loan Agreement.

 

Section 5.  Representations and Warranties.  Each Guarantor hereby makes to the Agent and the Lenders all of the representations and warranties made by Borrower with respect to or in any way relating to such Guarantor in the Loan Agreement and the other Loan Documents, as if the same were set forth herein in full.

 

Section 6.  Covenants.  Each Guarantor will comply with all covenants which Borrower is to cause such Guarantor to comply with under the terms of the Loan Agreement or any other Loan Documents.

 

Section 7.  Waiver.  Each Guarantor, to the fullest extent permitted by applicable law, hereby waives notice of acceptance hereof or any presentment, demand, protest or notice of any kind, and any other act or thing, or omission or delay to do any other act or thing, which in any manner or to any extent might vary the risk of such Guarantor or which otherwise might operate to discharge such Guarantor from its obligations hereunder.

 

Section 8.  Inability to Accelerate Loan.  If the Agent and/or the Lenders are prevented from demanding or accelerating payment thereof by reason of any automatic stay or otherwise, the Agent and/or the Lenders shall be entitled to receive from each Guarantor, upon demand therefor, the sums which otherwise would have been due had such demand or acceleration occurred.

 

Section 9.  Reinstatement of Obligations.  Each Guarantor agrees that this Guaranty and each Guarantor’s obligations hereunder shall continue to be effective or be reinstated, as the case may be, with respect to any Obligations if at any time payment of any such Obligations is rescinded or returned or otherwise must be restored by the Agent and/or the Lenders upon the insolvency, bankruptcy or reorganization of 

 

 

Borrower or Guarantor or otherwiseotherwise, and in such case, each Guarantor’s obligations hereunder with respect to such payment shall be reinstated as though such payment had been due but not made at such time.

 

Section 10.  Subrogation.  Until all of the Obligations shall have been indefeasibly paid in full, any right of subrogation a Guarantor may have shall be subordinate to the rights of Agent and the Lenders and each Guarantor hereby waives any right to enforce any remedy which the Agent and/or the Lenders now have or may hereafter have against Borrower.

 

Section 11.  Payments Free and Clear.  All sums payable by any Guarantor hereunder shall be made free and clear of and without deduction for any tax or other charge; provided that if any Guarantor shall be required by applicable law to deduct any taxes or other charge from such payments, then (i) the sum payable shall be increased as necessary so that after making all required deductions (including deductions applicable to additional sums payable under this Section), the Agent or any Lender (as the case may be) receives an amount equal to the sum it would have received had no such deductions been made; (ii) such Guarantor shall make such deductions and (iii) such Guarantor shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.

 

Section 12.  Set-off.  Each Guarantor hereby grants to Agent, on behalf of the Lenders, a security interest in and lien on all deposits (general or special, time or demand, provisional or final) at any time held and other obligations at any time owing by Agent to or for the credit or the account of such Guarantor.  In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, the Agent and each Lender is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final but excluding any funds held by Borrower on behalf of tenants or other third parties) at any time held and other obligations at any time owing by such LenderPerson to or for the credit or the account of any Guarantor against any of and all the obligations of such Guarantor now or hereafter existing under this Guaranty held by the Agent or such Lender then due and payable.

 

Section 13.  Subordination.  Each Guarantor hereby expressly covenants and agrees for the benefit of the Agent and the Lenders that all obligations and liabilities of Borrower or any other Guarantor to such Guarantor of whatever description, including without limitation, all intercompany receivables of such Guarantor from Borrower or any other Guarantor (collectively, the “Junior Claims”) shall be subordinate and junior in right of payment to all Obligations; provided, however, that payment thereof may be made so long as no Event of Default shall have occurred and be continuing.  If an Event of Default shall have occurred and be continuing, then no Guarantor shall accept any direct or indirect payment (in cash, property, securities by setoff or otherwise) from Borrower or any other Guarantor on account of or in any manner in respect of any Junior Claim until all of the Obligations have been indefeasibly paid in full.

 

Section 14.  Acknowledgement of Benefits; Contribution; Avoidance Provisions.

 

(a)           Acknowledgement of Benefits.  Each Guarantor acknowledges that it has received, or will receive, significant financial and other benefits, either directly or indirectly, from the proceeds of the Loan made by the Lenders to Borrower pursuant to the Loan Agreement; that the benefits received by each Guarantor are reasonably equivalent consideration for such Guarantor’s execution of this Guaranty; and that such benefits include, without limitation, the access to capital afforded to Borrower pursuant to the Loan Agreement from which the activities of such Guarantor will be supported, as applicable. Each Guarantor is executing this Guaranty and the other Loan Documents in consideration of those benefits received by it. This Guaranty is independent of (and shall not be limited by) any other guaranty now existing or hereafter given.  Further, each Guarantor’s liability under this Guaranty is in addition to any and all other liability such Guarantor may have in any other capacity, including without limitation, any other credit facilities or guaranties between and among the Agent, the Lenders and such Guarantor in connection with Borrower.

 

 

(b)           Contribution.  Each Guarantor hereby agrees that, in connection with payments made hereunder, such Guarantor shall have a right of contribution from each other Guarantor of the Loan in accordance with applicable law.  Such contribution rights shall be subordinate and subject in right of payment to the Obligations until such time as the Obligations have been indefeasibly and irrevocably paid in full, and none of  the Guarantors shall exercise any such contribution rights until the Obligations have been indefeasibly and irrevocably paid in full.

 

(c)           Section 14.   Avoidance Provisions.  It is the intent of each Guarantor, the Agent and the Lenders that in any Proceeding, eachsuch Guarantor’s maximum obligation hereunder shall equal, but not exceed, the maximum amount which would not otherwise cause the obligations of such Guarantor hereunder (or any other obligations of such Guarantor to the Agent and the Lenders) to be avoidable or unenforceable against such Guarantor in such Proceeding as a result of applicable law, including without limitation, (a) Section 548 of the Bankruptcy Code of 1978, as amended (the “Bankruptcy Code”) and (b) any state fraudulent transfer or fraudulent conveyance act or statute applied in such Proceeding, whether by virtue of Section 544 of the Bankruptcy Code or otherwise.  The applicable laws under which the possible avoidance or unenforceability of the obligations of such Guarantor hereunder (or any other obligations of such Guarantor to the Agent and the Lenders) shall be determined in any such Proceeding are referred to as the “Avoidance Provisions.”  Accordingly, to the extent that the obligations of any Guarantor hereunder would otherwise be subject to avoidance under the Avoidance Provisions, the maximum Obligations for which such Guarantor shall be liable hereunder shall be reduced to that amount which, as of the time any of the Obligations are deemed to have been incurred under the Avoidance Provisions, would not cause the obligations of any Guarantor hereunder (or any other obligations of any Guarantor to the Agent and the Lenders), to be subject to avoidance under the Avoidance Provisions.  This Section is intended solely to preserve the rights of the Agent and the Lenders hereunder to the maximum extent that would not cause the obligations of any Guarantor hereunder to be subject to avoidance under the Avoidance Provisions, and no Guarantor nor any other Person shall have any right or claim under this Section as against the Agent and the Lenders that would not otherwise be available to such Person under the Avoidance Provisions.

 

Section 15.  Information.  Each Guarantor assumes all responsibility for being and keeping itself informed of the financial condition of Borrower, of the other Guarantors and of all other circumstances bearing upon the risk of nonpayment of any of the Obligations and the nature, scope and extent of the risks that Guarantor assumes and incurs hereunder, and agrees that none of the Agent or any Lender shall have any duty whatsoever to advise such Guarantor of information regarding such circumstances or risks.

 

Section 16.  Governing Law.  THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, INCLUDING, WITHOUT LIMITATION, NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1401.

 

Section 17.  Jurisdiction; VenueJURISDICTION; VENUE; JURY WAIVER.

 

(a)           EACH OF THE GUARANTORS AND THE AGENT AGREE THAT ANY SUIT FOR THE ENFORCEMENT OF THIS GUARANTY SHALL BE BROUGHT IN ANY COURT OF COMPETENT JURISDICTION IN THE STATE OF NEW YORK (INCLUDING ANY FEDERAL COURT SITTING THEREIN).  EACH OF THE GUARANTORS AND THE AGENT FURTHER ACCEPT, GENERALLY AND UNCONDITIONALLY, THE EXCLUSIVE JURISDICTION OF SUCH COURTS AND ANY RELATED APPELLATE COURT AND IRREVOCABLY (i) AGREE TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY WITH RESPECT TO THIS GUARANTY AND (ii) WAIVE ANY OBJECTION ANY OF THEM MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH A COURT IS AN INCONVENIENT FORUM.  EACH OF THE GUARANTORS AND THE AGENT FURTHER AGREE THAT SERVICE OF PROCESS IN ANY SUCH SUIT MAY BE MADE UPON ANY GUARANTOR BY MAIL AT THE ADDRESS SPECIFIED IN SECTION 25 OF THIS GUARANTY.  IN ADDITION TO THE COURTS OF THE STATE OF 

 

 

NEW YORK OR ANY FEDERAL COURT SITTING THEREIN, THE AGENT MAY BRING ACTION(S) FOR ENFORCEMENT ON A NONEXCLUSIVE BASIS WHERE ANY ASSETS OF ANY GUARANTOR EXIST AND EACH OF THE GUARANTORS CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURTS AND THE SERVICE OF PROCESS IN ANY SUCH SUIT  BEING MADE UPON IT BY MAIL AT THE ADDRESS SPECIFIED IN SECTION 25 OF THIS GUARANTY.

 

(a) Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the state and federal courts in New York, New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Guaranty or any other Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such State or, to the extent permitted by law, in such Federal court.  Each of the parties hereto 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 law.  Nothing in this Guaranty shall affect any right that the Agent or any Lender may otherwise have to bring any action or proceeding relating to this Guaranty or any other Loan Document against the Guarantor or its properties in the courts of any jurisdiction.

 

(b) Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, 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 Guaranty or any other Loan Document in any court referred to in paragraph (a) of this Section.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

(b)           (c) WAIVER OF JURY TRIAL.  EACH PARTY HERETOOF THE GUARANTORS AND THE AGENT HEREBY WAIVES, ITS RIGHT TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW,A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN CONNECTION WITH THIS GUARANTY, THE LOAN AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.  EACH GUARANTOR HEREBY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTY, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORTCLAIM OR RECOVER IN ANY SUCH LITIGATION ANY SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, PUNITIVE OR ANY DAMAGES OTHER THEORY)THAN, OR IN ADDITION TO, ACTUAL DAMAGES.  EACH PARTY HERETOGUARANTOR (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTYTHE AGENT HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTYTHE AGENT WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERWAIVERS AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVEAGENT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENTGUARANTY AND THE OTHER LOAN DOCUMENTS TO WHICH IT IS A PARTY BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS CONTAINED IN THIS SECTION. 17.  EACH GUARANTOR ACKNOWLEDGES THAT IT HAS HAD AN OPPORTUNITY TO REVIEW THIS SECTION 17 WITH LEGAL COUNSEL AND THAT EACH GUARANTOR AGREES TO THE FOREGOING AS ITS FREE, KNOWING AND VOLUNTARY ACT.

 

 

Section 18.  Loan Accounts.  The Agent may maintain books and accounts setting forth the amounts of principal, interest and other sums paid and payable with respect to the Obligations, and in the case of any dispute relating to any of the outstanding amount, payment or receipt of the Obligations or otherwise, the entries in such account shall be binding upon each Guarantor as to the outstanding amount of such Obligations and the amounts paid and payable with respect thereto absent manifest error.  The failure of the Agent to maintain such books and accounts shall not in any way relieve or discharge any Guarantor of any of its obligations hereunder.

 

Section 19.  Waiver of Remedies.  No delay or failure on the part of the Agent or the Lenders in the exercise of any right or remedy it may have against any Guarantor hereunder or otherwise shall operate as a waiver thereof, and no single or partial exercise by the Agent or the Lenders of any such right or remedy shall preclude other or further exercise thereof or the exercise of any other such right or remedy.

 

Section 20.  Successors and Assigns.  Each reference herein to the Agent or the Lenders shall be deemed to include such Person’s respective successors and assigns (including, but not limited to, any holder of the Obligations) in whose favor the provisions of this Guaranty also shall inure, and each reference herein to a Guarantor shall be deemed to include thesuch Guarantor’s successors and assigns, upon whom this Guaranty also shall be binding.  The Lenders and the Agent may, in accordance with the applicable provisions of the Loan Agreement, assign, transfer or sell any Obligation, or grant or sell participation in any Obligations, to any Person or entity without the consent of, or notice to, any Guarantor and without releasing, discharging or modifying any Guarantor’s obligations hereunder.  Each Guarantor hereby consents to the delivery by the Agent or any Lender to any assignee, transferee or participant of any financial or other information regarding Borrower or any Guarantor.  No Guarantor may not assign or transfer its obligations hereunder to any Person.

 

Section 21.   Amendments.  This Guaranty may not be amended except as provided in the Loan Agreement.

 

Section 21.  Amendments.  No amendment, modification, termination, or waiver of any provision of this Guaranty, and no consent to any departure by any Guarantor from the terms and conditions hereof, shall in any event be effective unless the same shall be in writing and signed by the Agent and each Guarantor or Guarantors with respect to whom such waiver, amendment or modification is to apply in accordance with the Loan Agreement.  Any such waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given.  This Guaranty shall be construed as a separate agreement with respect to each Guarantor and may be amended, modified, supplemented, waived or released with respect to any Guarantor without the approval of any other Guarantor and without affecting the obligations of any other Guarantor hereunder.

 

Section 22.  Additional Subsidiary Guarantors.  The initial Guarantors hereunder shall be each of the Subsidiaries of Borrower that are signatories hereto, which are listed on Schedule I attached hereto. From time to time after the date hereof, additional Subsidiaries of the Borrower may become parties hereto as additional Guarantors (each an “Additional Subsidiary Guarantor”) by executing a Guaranty Joinder Agreement in the form of Exhibit A attached hereto. Upon delivery of any such Guaranty Joinder Agreement to the Agent, notice of which is hereby waived by the other Guarantors, each such Additional Subsidiary Guarantor shall be a Guarantor hereunder and shall be a party hereto as if such Additional Subsidiary Guarantor were an original signatory hereof. Each Guarantor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the addition or release of any other Guarantor hereunder, or by any election by the Agent not to cause any Subsidiary of Borrower to become an Additional Subsidiary Guarantor hereunder.

 

Section 23.  Release of Guarantors.  Each applicable Guarantor shall be released from its obligations under this Guaranty as and when provided in Section 5.4 of the Loan Agreement.  Upon Borrower’s request, Agent shall confirm the release of any applicable Guarantor by the execution of a Release of Guarantor in the form of Exhibit B attached hereto.  Each Guarantor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the release of any other Guarantor hereunder.

 

 

Section 24.  Section 22.   Payments.  All payments made by Guarantor pursuant to this Guaranty shall be made in Dollars, in immediately available funds to the Agent at the place and time provided for in the Loan Agreement on the date three (3) Business Days after written demand therefor to Guarantor by the Agent.

 

Section 25.  Section 23.   Notices.  All notices, requests and other communications hereunder shall be in writing and shall be given as provided in the Loan Agreement.  Each Guarantor’s address for notice is set forth below its signature hereto.

 

Section 26.  Section 24.   Severability.  In case any provision of this Guaranty shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

Section 27.  Section 25.   Headings.  Section headings used in this Guaranty are for convenience only and shall not affect the construction of this Guaranty.

 

Section 28.  Section 26.   Delivery. Delivery of an executed signature page to this Agreement by telecopier or by email with a pdf or similar attachment shall be effective as delivery of an original executed Agreement.

 

Section 29.  Section 27.   Definitions.

 

a)            For the purposes of this Guaranty, “Proceeding” means any of the following:  (i) a voluntary or involuntary case concerning any Guarantor shall be commenced under the Bankruptcy Code or any other applicable bankruptcy laws; (ii) a custodian (as defined in the Bankruptcy Code or any other applicable bankruptcy laws) is appointed for, or takes charge of, all or any substantial part of the property of any Guarantor; (iii) any other proceeding under any applicable law, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding-up or composition for adjustment of debts, whether now or hereafter in effect, is commenced relating to any Guarantor; (iv) any Guarantor is adjudicated insolvent or bankrupt; (v) any order of relief or other order approving any such case or proceeding is entered by a court of competent jurisdiction; (vi) any Guarantor makes a general assignment for the benefit of creditors; (vii) any Guarantor shall fail to pay, or shall state that it is unable to pay, or shall be unable to pay, its debts generally as they become due; (viii) any Guarantor shall call a meeting of its creditors with a view to arranging a composition or adjustment of its debts; (ix) any Guarantor shall by any act or failure to act indicate its consent to, approval of or acquiescence in any of the foregoing; or (x) any corporate action shall be taken by any Guarantor for the purpose of effecting any of the foregoing.

 

(a)           (b) Terms not otherwise defined herein are used herein with the respective meanings given them in the Loan Agreement.

 

Section 30.  JOINT AND SEVERAL OBLIGATIONS.  THE OBLIGATIONS OF THE GUARANTORS HEREUNDER SHALL BE JOINT AND SEVERAL, AND ACCORDINGLY, EACH GUARANTOR CONFIRMS THAT IT IS LIABLE FOR THE FULL AMOUNT OF THE “OBLIGATIONS” AND ALL OF THE OTHER OBLIGATIONS AND LIABILITIES OF EACH OF THE OTHER GUARANTORS HEREUNDER.

 

[Remainder of Page Intentionally Left Blank]

 

 

IN WITNESS WHEREOF, each Guarantor has duly executed and delivered this Guaranty as of the date and year first written above.

 

	
 
    	
CORESITE REALTY CORPORATION,   a
    
	
 
    	
Maryland corporation
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name: Derek S.   McCandless
    
	
 
    	
Title:
    	
Senior Vice   President, Legal, Secretary and General Counsel
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 70   INNERBELT, L.L.C., a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 900 N.   ALAMEDA, L.P., a Delaware limited partnership
    
	
 
    	
By: 
    	
CORESITE REAL ESTATE 900 N.   Alameda 
    
	
 
    	
GP, L.L.C., a   Delaware limited liability company, its general partner
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 2901   CORONADO, L.P., a Delaware limited partnership
    
	
 
    	
By:
    	
CORESITE REAL ESTATE 2901   CORONADO 
    
	
 
    	
GP, L.L.C., a   Delaware limited liability company, its general partner
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 1656   MCCARTHY, L.P., a Delaware limited partnership
    
	
 
    	
By:
    	
CORESITE REAL ESTATE 1656 MCCARTHY   
    
	
 
    	
GP, L.L.C., a   Delaware limited liability company, its general partner
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 427 S.   LASALLE, L.L.C., a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 2972   STENDER, L.P., a Delaware limited partnership,
    
	
 
    	
By
    	
CORESITE REAL ESTATE 2972   STENDER 
    
	
 
    	
GP, L.L.C., a   Delaware limited liability company, its general partner
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 12100   SUNRISE VALLEY DRIVE L.L.C., a Delaware limited liability   company
    
	
 
    	
CORESITE REAL ESTATE 2115 NW   22ND STREET, L.L.C., a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
CORESITE ONE WILSHIRE, L.L.C.,   a Delaware limited liability company
    
	
 
    	
 
    
	
 
    	
CORESITE REAL ESTATE 55 S.   MARKET STREET, L.L.C., a Delaware limited liability company
    
					

 

[Signature Page to Term Loan Guaranty]

 

 

	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
Derek S. McCandless
    
	
 
    	
Title:
    	
Senior Vice President,   Legal and Secretary](2)
    

 

(2)  Borrower to update.

 

[Signature Page to Term Loan Guaranty]

 

 

	
 
    	
Address for Notices:
    
	
 
    	
 
    
	
 
    	
CoreSite, L.P.
    
	
 
    	
1001 17th Street, Suite 500
    
	
 
    	
Denver, CO 80202
    
	
 
    	
Attn: Mr. Adam Post
    
	
 
    	
Telecopy No.: (877) 549-5851
    
	
 
    	
 
    
	
 
    	
CoreSite, L.P.
    
	
 
    	
1001 17th Street, Suite 500
    
	
 
    	
Denver, CO 80202
    
	
 
    	
Attn: General Counsel
    
	
 
    	
Telecopy No.: (855)   232-0594
    
	
 
    	
 
    
	
With a copy to:
    
	
 
    	
 
    
	
 
    	
Latham & Watkins   LLP
    
	
 
    	
885 Third Avenue
    
	
 
    	
New York, NY 10022
    
	
 
    	
Attn: Dara DenbergJames   I. Hisiger, Esquire
    
	
 
    	
Telecopy No.:   (212) 751-4864
    
	
 
    	
 
    
	
 
    	
With a copy to:
    
	
 
    	
Latham &   Watkins LLP
    
	
 
    	
555 Eleventh   Street, NW, Suite 1000
    
	
 
    	
Washington, DC   20004-1304
    
	
 
    	
Attn: Jeffrey R.   Chenard, Esquire
    
	
 
    	
Telecopy No.:   (202) 637-2201
    

 

[Signature Page to Term Loan Guaranty]

 

 

SCHEDULE I

 

INITIAL GUARANTORS

 

1.     CoreSite Realty Corporation, a Maryland corporation

 

2.     CoreSite Real Estate 70 Innerbelt, L.L.C., a Delaware limited liability company

 

3.     CoreSite Real Estate 900 N. Alameda, L.P., a Delaware limited partnership

 

4.     CoreSite Real Estate 2901 Coronado, L.P., a Delaware limited partnership

 

5.     CoreSite Real Estate 1656 McCarthy, L.P., a Delaware limited partnership

 

6.     CoreSite Real Estate 427 S. LaSalle, L.L.C., a Delaware limited liability company

 

7.     CoreSite Real Estate 2972 Stender, L.P., a Delaware limited partnership

 

8.     CoreSite Real Estate 12100 Sunrise Valley Drive L.L.C., a Delaware limited liability company

 

9.     CoreSite Real Estate 2115 NW 22nd Street, L.L.C., a Delaware limited liability company

 

10.  CoreSite One Wilshire, L.L.C., a Delaware limited liability company

 

11.  CoreSite Real Estate 55 S. Market Street, L.L.C. , a Delaware limited liability company

 

 

EXHIBIT A

 

FORM OF GUARANTY JOINDER AGREEMENT

 

Date:             ,    

 

To:          Royal Bank of Canada, as Agent

 

Ladies and Gentlemen:

 

This Guaranty Joinder Agreement is made and delivered pursuant to Section 22 of that certain Second Amended and Restated Guaranty, dated as of June 15, 2016 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Guaranty”), by CoreSite Realty Corporation, a Maryland corporation, and certain of its subsidiaries party thereto, in favor of Royal Bank of Canada, as Agent.  All capitalized terms used in this Guaranty Joinder Agreement and not otherwise defined herein shall have the meanings assigned to them in the Guaranty.

 

Each of                        ([the][each, an] “Additional Subsidiary Guarantor”) hereby confirms, represents and warrants to the Agent and the Lenders that the Additional Subsidiary Guarantor is a Subsidiary of Borrower.

 

By executing and delivering this Guaranty Joinder Agreement, [the][each] Additional Subsidiary Guarantor, as provided in Section 22 of the Guaranty, hereby becomes a party to the Guaranty as a Guarantor thereunder with the same force and effect as if originally named therein as a Guarantor and, without limiting the generality of the foregoing, hereby expressly assumes all obligations and liabilities of a Guarantor thereunder.

 

Effective as of the date of this Guaranty Joinder Agreement, [the][each] Additional Subsidiary Guarantor confirms its acceptance of, and consents to, all representations and warranties, covenants, and other terms and provisions of the Guaranty.  [The][Each] Additional Subsidiary Guarantor hereby represents and warrants that each of the representations and warranties contained in Section 5 of the Guaranty is true and correct on and as the date hereof as if made on and as of such date, except to the extent any such representation or warranty (including any such representation or warranty contained in the Loan Agreement) was expressly made as of an earlier date, in which case such representation or warranty was true and correct as of such earlier date.

 

This Guaranty Joinder Agreement shall constitute a Loan Document under the Loan Agreement.

 

THIS GUARANTY JOINDER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Guaranty Joinder Agreement to be duly executed and delivered by their proper and duly authorized officers as of the day and year first above written.

 

	
 
    	
[ADDITIONAL SUBSIDIARY GUARANTOR]
    
	
 
    	
 
    
	
 
    	
By: 
    	
 
    
	
 
    	
Title:
    	
 
    

 

 

EXHIBIT B

 

FORM OF RELEASE OF GUARANTOR

 

In witness whereof, the undersigned Agent, for itself and on behalf of each of the Lenders (as defined in the Guaranty (as defined below)), hereby releases and discharges                     from any and all obligations and liabilities of                    to the Agent and the Lenders under that certain Second Amended and Restated Guaranty dated as of June 15, 2016, executed by CoreSite Realty Corporation, a Maryland corporation, and certain of its subsidiaries party thereto, described therein in favor of the Agent and the Lenders defined therein (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Guaranty”)

 

	
 
    	
ROYAL BANK   OF CANADA, as Agent
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:Exhibit 4.1

 

[FORM OF SERIES I WARRANT]

 

NEITHER THE ISSUANCE AND SALE OF THE
SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE,
SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL SELECTED BY THE HOLDER, IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION
IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING,
THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE
SECURITIES.

 

DropCar,
Inc.

 

Warrant
To Purchase Common Stock

 

Warrant No.: 2018I-           

Number of Shares of Common Stock:_____________

Date of Issuance: [], 2018 (“Issuance Date”)

 

DropCar, Inc., a Delaware
corporation (the “Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, [ ], the registered holder hereof or its permitted
assigns (the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, at
the Exercise Price (as defined below) then in effect, at any time or times on or after the Issuance Date, but not after 11:59 p.m.,
New York time, on the Expiration Date, (as defined below), ______________ (_____________)1
fully paid nonassessable shares of Common Stock, subject to adjustment as provided herein (the “Warrant Shares”).
Except as otherwise defined herein, capitalized terms in this Warrant to Purchase Common Stock (including any Warrants to Purchase
Common Stock issued in exchange, transfer or replacement hereof, this “Warrant”) shall have the meanings set
forth in Section 18 or as defined in the Exchange Agreement (as defined below). This Warrant is one of the Warrants to purchase
Common Stock (the “Exchange Warrants”) issued pursuant to Section 1 of that certain Warrant Exchange Agreement,
dated as of [], 2018 (the “Subscription Date”), by and among the Company and the Holder (the “Exchange
Agreement”).

 

1.             EXERCISE
OF WARRANT.

 

(a)  
Mechanics of Exercise. Subject to the terms and conditions hereof (including, without
limitation, the limitations set forth in Section 1(f)), this Warrant may be exercised by the Holder at any time or times on or
after the Issuance Date, in whole or in part, by (i) delivery of a written notice, in the form attached hereto as Exhibit
A (the “Exercise Notice”), of the Holder’s election to exercise this Warrant and (ii) (A) payment
to the Company of an amount equal to the applicable Exercise Price multiplied by the number of Warrant Shares as to which this
Warrant is being exercised (the “Aggregate Exercise Price”) in cash by wire transfer of immediately available
funds or (B) if the provisions of Section 1(d) are applicable, by notifying the Company that this Warrant is being exercised pursuant
to a Cashless Exercise (as defined in Section 1(d)). The Holder shall not be required to deliver the original Warrant in order
to effect an exercise hereunder. Execution and delivery of the Exercise Notice with respect to less than all of the Warrant Shares
shall have the same effect as cancellation of the original Warrant and issuance

 

 

1
Insert 50% of the number of shares of Common Stock subject to Holder’s existing Merger Warrant.

 

     

     

    

 

of a new Warrant evidencing the right to purchase
the remaining number of Warrant Shares. On or before the first (1st) Trading Day following the date on which the Company
has received the Exercise Notice, the Company shall transmit by electronic mail, facsimile an acknowledgment of confirmation of
receipt of the Exercise Notice to the Holder. On or before the third (3rd) Trading Day following the date on which the Company
has received the Exercise Notice, so long as the Holder delivers the Aggregate Exercise Price (or notice of a Cashless Exercise)
on or prior to the second (2nd) Trading Day following the date on which the Company has received the Exercise Notice (the “Share
Delivery Date”) (provided that if the Aggregate Exercise Price (or notice of a Cashless Exercise) has not been delivered
by such date, the Share Delivery Date shall be extended one (1) Trading Day after the Aggregate Exercise Price (or notice of a
Cashless Exercise) is delivered), the Company shall (X) provided that the Company’s transfer agent (“Transfer Agent”)
is participating in The Depository Trust Company (“DTC”) Fast Automated Securities Transfer Program and the
Warrant Shares are eligible to be issued without a restrictive legend, credit such aggregate number of Warrant Shares to which
the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account with DTC through
its Deposit/Withdrawal At Custodian system, or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities
Transfer Program or the Warrant Shares are not eligible to be issued without a restrictive legend, issue and dispatch by overnight
courier to the address as specified in the Exercise Notice, a certificate, registered in the Company’s share register in
the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise.
The Company shall be responsible for all fees and expenses of the Transfer Agent and all fees and expenses with respect to the
issuance of Warrant Shares via DTC, if any. Upon delivery of the Exercise Notice and the Aggregate Exercise Price (or notice of
a Cashless Exercise) (such date of delivery being the “Exercise Date”), the Holder shall be deemed for all corporate
purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective
of the date such Warrant Shares are credited to the Holder’s DTC account or the date of delivery of the certificates evidencing
such Warrant Shares, as the case may be. If this Warrant is submitted in connection with any exercise pursuant to this Section
1(a) and the number of Warrant Shares represented by this Warrant submitted for exercise is greater than the number of Warrant
Shares being acquired upon an exercise, then the Company shall as soon as practicable and in no event later than three (3) Trading
Days after any exercise and at its own expense, issue a new Warrant (in accordance with Section 8(d)) representing the right to
purchase the number of Warrant Shares issuable immediately prior to such exercise under this Warrant, less the number of Warrant
Shares with respect to which this Warrant is exercised. No fractional Warrant Shares are to be issued upon the exercise of this
Warrant, but rather the number of Warrant Shares to be issued shall be rounded up to the nearest whole number. The Company shall
pay any and all taxes which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant;
provided, that the Company shall not be required to
pay any tax or governmental charge that may be imposed with respect to any applicable withholding or the issuance or delivery of
the Warrant Shares to any Person other than the Holder, and no such issuance or delivery shall be made unless and until such Person
other than the Holder requesting such issuance has paid to the Company the amount of any such tax, or has established to the satisfaction
of the Company that such tax has been paid. The Company’s obligations to issue and deliver Warrant Shares in accordance with
the terms and subject to the conditions hereof are absolute and unconditional, irrespective of any action or inaction by the Holder
to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person
or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination. The Holder and any assignee,
by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase
of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may
be less than the amount stated on the face hereof.

 

    	 	2	 

     

    

 

(b)  
Exercise Price. For purposes of this Warrant, “Exercise Price”
means $2.30, subject to adjustment as provided herein.

 

(c)  
Company’s Failure to Timely Deliver Securities. If the Company shall fail for
any reason or for no reason on or prior to the Share Delivery Date either (a) if the Transfer Agent is not participating in the
DTC Fast Automated Securities Transfer Program and the Warrant Shares are eligible to be issued without a restrictive legend, to
issue to the Holder a certificate without any restrictive legend for the number of shares of Common Stock to which the Holder is
entitled and register such shares of Common Stock on the Company’s share register or (b) if the Transfer Agent is participating
in the DTC Fast Automated Securities Transfer Program and the Warrant Shares are eligible to be issued without a restrictive legend,
to credit the Holder’s balance account with DTC, for such number of shares of Common Stock to which the Holder is entitled
upon the Holder’s exercise of this Warrant, or if the Warrant Shares are not eligible to be issued without a restrictive
legend, to issue and dispatch by overnight courier to the address as specified in the Exercise Notice for delivery on or before
the Share Delivery Date a certificate, registered in the Company’s share register in the name of the Holder or its designee,
for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise (an “Exercise Failure”),
then, in addition to all other remedies available to the Holder, (X) the Company shall pay in cash to the Holder on each day after
the Share Delivery Date and during such Exercise Failure an amount equal to 1.0% of the product of (A) the number of shares of
Common Stock not issued to the Holder on or prior to the Share Delivery Date and to which the Holder is entitled, and (B) the closing
price of the Common Stock on the date of the applicable Exercise Notice, and (Y) the Holder, upon written notice to the Company,
may void its Exercise Notice with respect to, and retain or have returned, as the case may be, any portion of this Warrant that
has not been exercised pursuant to such Exercise Notice; provided that the voiding of an Exercise Notice shall not affect the Company’s
obligations to make any payments which have accrued prior to the date of such notice pursuant to this Section 1(c) or otherwise.
In addition to the foregoing, if an Exercise Failure occurs, and if on or after the Share Delivery Date the Holder purchases (in
an open market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale through a broker by the Holder
of shares of Common Stock issuable upon such exercise that the Holder anticipated receiving from the Company (a “Buy-In”),
then the Company shall, within three (3) Trading Days after the Holder’s request and in the Holder’s discretion, either
(i) pay cash to the Holder in an amount equal to the Holder’s total purchase price (including brokerage commissions and other
reasonable out of pocket expenses related to the Buy-In, if any) for the shares of Common Stock so purchased (such number of shares
not to exceed the number of Warrant Shares failed to be delivered) (the “Buy-In Price”), at which point the
Company’s obligation to deliver such certificate (and to issue such shares of Common Stock) or credit such Holder’s
balance account with DTC for such shares of Common Stock shall terminate, or (ii) promptly honor its obligation to deliver to the
Holder a certificate or certificates representing such shares of Common Stock or credit such Holder’s balance account with
DTC, as applicable, and pay cash to the Holder in an amount equal to the excess (if any) of the Buy-In Price over the product of
(A) such number of shares of Common Stock, times (B) the sale price of the Common Stock at which the sell order giving rise to
such purchase obligation was executed. Nothing shall limit the Holder’s right to pursue any other remedies available to it
hereunder, at law or in equity, including, without limitation, a decree of specific performance and/or injunctive relief with respect
to the Company’s failure to timely deliver certificates representing shares of Common Stock (or to electronically deliver
such shares of Common Stock) upon the exercise of this Warrant as required pursuant to the terms hereof.

 

(d)  
Cashless Exercise. If at any time after six-month anniversary of the date of the Exchange
Agreement, there is no effective registration statement registering, or no current prospectus available for, the resale of the
Warrant Shares by the Holder, then the Holder may, in its sole discretion (and without limiting the Holder’s rights and
remedies contained herein), exercise this Warrant in whole or in part and, subject to the provisions of Section 1(a), in
lieu of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate
Exercise Price, elect instead to receive the number of Warrant Shares as is computed using the following formula:

 

 

    	 	3	 

     

    

 

X =Y(A - B) ÷ A

 

Where:

 

X = the number of Warrant Shares
to be issued to the Holder.

 

Y = the total number of Warrant
Shares for which the Holder has elected to exercise this Warrant pursuant to Section 1(a).

 

A = the Closing Bid Price of the
Company’s Common Stock as of the applicable Exercise Date.

 

B = the Exercise Price in effect
under this Warrant as of the applicable Exercise Date.

 

For purposes of Rule 144(d) promulgated
under the 1933 Act, as in effect on the date hereof, it is intended that the Warrant Shares issued in a Cashless Exercise shall
be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares shall be deemed to have commenced,
on the date this Warrant was originally issued pursuant to the Exchange Agreement.

 

(e)  
Disputes. In the case of a dispute as to the determination of the Exercise Price or
the arithmetic calculation of the Warrant Shares, the Company shall promptly issue to the Holder the number of Warrant Shares that
are not disputed and resolve such dispute in accordance with Section 13.

 

(f)   
Limitations on Exercises. Notwithstanding anything to the contrary contained herein,
the Company shall not effect the exercise of any portion of this Warrant, and the Holder shall not have the right to exercise any
portion of this Warrant, pursuant to the terms and conditions of this Warrant and any such exercise shall be null and void and
treated as if never made, to the extent that after giving effect to such exercise, the Holder together with the other Attribution
Parties collectively would beneficially own in excess of 9.99% (the “Maximum Percentage”) of the number of shares
of Common Stock outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate
number of shares of Common Stock beneficially owned by the Holder and the other Attribution Parties shall include the number of
shares of Common Stock held by the Holder and all other Attribution Parties plus the number of shares of Common Stock issuable
upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall exclude the number
of shares of Common Stock which would be issuable upon (A) exercise of the remaining, unexercised portion of this Warrant beneficially
owned by the Holder or any of the other Attribution Parties and (B) exercise or conversion of the unexercised or unconverted portion
of any other securities of the Company (including, without limitation, any convertible notes or convertible preferred stock or
warrants, including the other Exchange Warrants) beneficially owned by the Holder or any other Attribution Party subject to a limitation
on conversion or exercise analogous to the limitation contained in this Section 1(f). For purposes of this Section 1(f), beneficial
ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “1934
Act”). For purposes of this Warrant, in determining the number of outstanding shares of Common Stock the Holder may acquire
upon the exercise of this Warrant without exceeding the Maximum Percentage, the Holder may rely on the number of outstanding shares
of Common Stock as reflected in (x) the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q,
Current Report on Form 8-K or other public filing with the Securities and Exchange Commission (the “SEC”), as
the case may be, (y) a more recent public announcement by the Company or

 

    	 	4	 

     

    

 

(3) any other written notice by the Company or the Transfer
Agent setting forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”).
If the Company receives an Exercise Notice from the Holder at a time when the actual number of outstanding shares of Common Stock
is less than the Reported Outstanding Share Number, the Company shall (i) notify the Holder in writing of the number of shares
of Common Stock then outstanding and, to the extent that such Exercise Notice would otherwise cause the Holder’s beneficial
ownership, as determined pursuant to this Section 1(f), to exceed the Maximum Percentage, the Holder must notify the Company of
a reduced number of Warrant Shares to be purchased pursuant to such Exercise Notice (the number of shares by which such purchase
is reduced, the “Reduction Shares”) and (ii) as soon as reasonably practicable, the Company shall return to
the Holder any exercise price paid by the Holder for the Reduction Shares. For any reason at any time, upon the written or oral
request of the Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail to the
Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall
be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder
and any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported. In the event that
the issuance of shares of Common Stock to the Holder upon exercise of this Warrant results in the Holder and the other Attribution
Parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares
of Common Stock (as determined under Section 13(d) of the 1934 Act), the number of shares so issued by which the Holder’s
and the other Attribution Parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”)
shall be deemed null and void and shall be cancelled ab initio, and the Holder shall not have the power to vote or to transfer
the Excess Shares. As soon as reasonably practicable after the issuance of the Excess Shares has been deemed null and void, the
Company shall return to the Holder the exercise price paid by the Holder for the Excess Shares. Upon delivery of a written notice
to the Company, the Holder may from time to time increase (with such increase not effective until the sixty-first (61st)
day after delivery of such notice) or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified
in such notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st)
day after such notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the
other Attribution Parties and not to any other holder of Exchange Warrants that is not an Attribution Party of the Holder. For
purposes of clarity, the shares of Common Stock issuable pursuant to the terms of this Warrant in excess of the Maximum Percentage
shall not be deemed to be beneficially owned by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1)
of the 1934 Act. No prior inability to exercise this Warrant pursuant to this paragraph shall have any effect on the applicability
of the provisions of this paragraph with respect to any subsequent determination of exercisability. The provisions of this paragraph
shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 1(f) to the extent
necessary to correct this paragraph or any portion of this paragraph which may be defective or inconsistent with the intended beneficial
ownership limitation contained in this Section 1(f) or to make changes or supplements necessary or desirable to properly give effect
to such limitation. The limitation contained in this paragraph may not be waived and shall apply to a successor holder of this
Warrant.

 

(g)  
Insufficient Authorized Shares. If at any time while this Warrant remains outstanding
the Company does not have a sufficient number of authorized and unreserved shares of Common Stock to satisfy its obligation to
reserve for issuance upon exercise of this Warrant at least a number of shares of Common Stock equal to the number of shares of
Common Stock as shall from time to time be necessary to effect the exercise of all of this Warrant then outstanding (the “Required
Reserve Amount” and the failure to have such sufficient number of authorized and unreserved shares of Common Stock, an
“Authorized Share Failure”), then the Company shall promptly take all action necessary to increase the Company’s
authorized shares of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount for this
Warrant then outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date of the
occurrence of an Authorized Share Failure, but in no event later than sixty (60) days after the occurrence of such Authorized Share
Failure, the

 

    	 	5	 

     

    

 

Company shall hold a meeting of its stockholders for the approval of an increase in the number of authorized shares
of Common Stock. In connection with such meeting, the Company shall provide each stockholder with a proxy statement and shall use
its commercially reasonable efforts to solicit its stockholders’ approval of such increase in authorized shares of Common
Stock and to cause its board of directors to recommend to the stockholders that they approve such proposal. Notwithstanding the
foregoing, if any such time of an Authorized Share Failure, the Company is able to obtain the written consent of a majority of
the shares of its issued and outstanding Common Stock to approve the increase in the number of authorized shares of Common Stock
without soliciting its stockholders, the Company may satisfy this obligation by obtaining such consent and submitting for filing
with the SEC an Information Statement on Schedule 14C. 

 

2.             ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and
the number of Warrant Shares shall be adjusted from time to time as follows:

 

(a)  
Adjustment Upon Subdivision or Combination of Shares of Common Stock. If the Company
at any time on or after the Subscription Date subdivides (by any stock split, stock dividend, recapitalization or otherwise) one
or more classes of its outstanding shares of Common Stock into a greater number of shares, the Exercise Price in effect immediately
prior to such subdivision will be proportionately reduced and the number of Warrant Shares will be proportionately increased. If
the Company at any time on or after the Subscription Date combines (by combination, reverse stock split or otherwise) one or more
classes of its outstanding shares of Common Stock into a smaller number of shares, the Exercise Price in effect immediately prior
to such combination will be proportionately increased and the number of Warrant Shares will be proportionately decreased. Any adjustment
under this Section 2(a) shall become effective at the close of business on the date the subdivision or combination becomes
effective.

 

3.             RIGHTS UPON DISTRIBUTION OF ASSETS. If the Company shall declare or make any dividend
or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock, by way of return of
capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property, options, evidence
of indebtedness or any other assets by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement
or other similar transaction) (a “Distribution”), at any time after the issuance of this Warrant, then, in each
such case, the Holder shall be entitled, and the Company shall reserve the Holder’s pro rata share of the Distribution pending
complete exercise of this Warrant, to participate in such Distribution to the same extent that the Holder would have participated
therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without
regard to any limitations or restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage) immediately
before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record
holders of shares of Common Stock are to be determined for the participation in such Distribution (provided, however,
that to the extent that the Holder’s right to participate in any such Distribution would result in the Holder and the other
Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Distribution
to such extent (and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Distribution
(and beneficial ownership) to such extent).

 

4.             PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS.

 

(a)  
Purchase Rights. In addition to any adjustments pursuant to Section 2 above, if at
any time the Company grants, issues or sells any Options, Convertible Securities or rights to purchase stock, warrants, securities
or other property pro rata to all of the record holders of any class of Common Stock (the “Purchase Rights”),
then the Holder will be entitled, and the Company shall reserve the Holder’s pro rata share of the Purchase Rights pending
complete exercise of this Warrant, to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights
which the Holder could

 

    	 	6	 

     

    

 

have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise
of this Warrant (without regard to any limitations or restrictions on exercise of this Warrant, including without limitation, the
Maximum Percentage) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights,
or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the
grant, issue or sale of such Purchase Rights (provided, however, that to the extent that the Holder’s right
to participate in any such Purchase Right would result in the Holder and the other Attribution Parties exceeding the Maximum Percentage,
then the Holder shall not be entitled to participate in such Purchase Right to such extent (and shall not be entitled to beneficial
ownership of such shares of Common Stock as a result of such Purchase Right (and beneficial ownership) to such extent).

 

(b)  
Fundamental Transactions. In the event of any Fundamental Transaction, this Warrant
shall, immediately after such Fundamental Transaction, remain outstanding and shall thereafter, be exercisable for the number of
Warrant Shares then exercisable under this Warrant, subject to appropriate adjustment (in form and substance satisfactory to the
Holder) in the Exercise Price to the value per share for the Common Stock reflected by the terms of such Fundamental Transaction,
and a corresponding immediate adjustment to the number of Warrant Shares acquirable upon exercise of this Warrant without regard
to any limitations or restrictions on exercise, if the value so reflected is less than the Exercise Price in effect immediately
prior to such consolidation, merger, sale or similar transaction). The provisions of this Section 4(b) shall similarly apply to
successive reorganizations, reclassifications, consolidations, mergers, sales or similar transactions. The Company shall not effect
any such Fundamental Transaction unless, prior to the consummation thereof, the successor Person (if other than the Company) resulting
from such Fundamental Transaction, shall assume, by written instrument substantially similar in form and substance to this Warrant
and satisfactory to the Holder, the obligation to deliver to the Holder the number of Warrant Shares then exercisable under this
Warrant, subject to adjustment, in accordance with the foregoing provisions. Notwithstanding anything to the contrary contained
herein, with respect to any Fundamental Transaction, the Holder shall have the right to elect prior to the consummation of such
Fundamental Transaction, to give effect to the exercise rights contained in Section 1 instead of giving effect to the provisions
contained in this Section 4(b) with respect to this Warrant.

 

5.             Mandatory Exercise.

 

(a)  
If at any time from and after the Issuance Date (i) the VWAP of the Common Stock listed on
the Principal Market equals or exceeds $4.60 (subject to appropriate adjustments for stock splits, stock dividends, recapitalizations,
reorganizations, reclassifications, combinations, reverse stock splits or other similar transactions after the Issuance Date)
for not less than ten (10) consecutive Trading Days (the “Mandatory Exercise Measuring Period”); (ii) the daily
average number of shares of Common Stock listed on the Principal Market traded during the Mandatory Exercise Measuring Period
equals or exceeds 150,000 (subject to appropriate adjustments for stock splits, stock dividends, recapitalizations, reorganizations,
reclassifications, combinations, reverse stock splits or other similar transactions after the Issuance Date); and (iii) no Equity
Conditions Failure (as defined below) has occurred (unless the Holder has waived such Equity Conditions Failure) as of such date
(clauses (i), (ii) and (iii), the “Mandatory Exercise Conditions”), then the Company shall have the right to
require the Holder to exercise all or any portion of this Warrant still unexercised for a cash exercise, as designated in the
Mandatory Exercise Notice on the Mandatory Exercise Date (each as defined below) into fully paid, validly issued and nonassessable
shares of Common Stock in accordance with Section 1 hereof at the Exercise Price as of the Mandatory Exercise Date (as defined
below) (a “Mandatory Exercise”). The Company may exercise its right to require exercise under this Section
5 by delivering within not more than two (2) Trading Days following the end of such Mandatory Exercise Measuring Period a written
notice thereof by facsimile

 

    	 	7	 

     

    

 

or electronic mail to the Holder (the
“Mandatory Exercise Notice” and the date that the Holder received such notice is referred to as the “Mandatory
Exercise Notice Date”). The Mandatory Exercise Notice shall be irrevocable. The Mandatory Exercise Notice shall (x) state
(I) the Trading Day on which the Mandatory Exercise shall occur, which shall be the third (3rd) Trading Day following
the Mandatory Exercise Notice Date (the “Mandatory Exercise Date”) and (II) the aggregate number of Warrants
which the Company has elected to be subject to such Mandatory Exercise from the Holder (the “Mandatory Exercise Amount”)
pursuant to this Section 5 and (y) certify that the Mandatory Exercise Conditions have been satisfied. The Mandatory Exercise thereunder
may only occur on the Mandatory Exercise Date if there is no Equity Conditions Failure (unless the Holder has waived such Equity
Conditions Failure) during the ten (10) consecutive Trading Day period that occurs immediately prior to the Mandatory Exercise
Date (the “Mandatory Exercise Bring-Down Conditions”).

 

(b)  
The
Company shall deliver to the Holder a notice no later than 10:00 a.m., New York Time, on the Mandatory Exercise Date (the “Bring-Down
Notice”), which notice shall certify whether or not the Mandatory Exercise Bring-Down Conditions have been satisfied.
If the Mandatory Exercise Bring-Down Conditions have not been satisfied at such time (and are not waived by the Holder), the Mandatory
Exercise Notice will be null and void, ab initio. Notwithstanding anything to the contrary in this Section 5, until the
Mandatory Exercise has occurred, the Mandatory Exercise Amount may be exercised, in whole or in part, by the Holder into shares
of Common Stock pursuant to Section 1. The Company covenants and agrees that it will honor all Exercise Notices tendered from the
time of delivery of the Mandatory Exercise Notice until the Mandatory Exercise has occurred. Unless otherwise indicated by the
Holder, all Warrants exercised by the Holder after the Mandatory Exercise Notice Date shall reduce the Mandatory Exercise Amount
of this Warrant required to be exercised on the Mandatory Exercise Date. Upon an Equity Conditions Failure, the Holder may revoke
any Exercise Notice delivered after the Mandatory Exercise Notice is received by the Holder, and the Company, within one (1) Business
Day of such revocation, shall return the Aggregate Exercise Price applicable to any such Exercise Notice(s) to the Holder by wire
transfer of immediately available funds and any Warrants so exercised shall be deemed reinstated and returned to the Holders, if
applicable. Delivery of any shares of Common Stock issuable pursuant to a Mandatory Exercise shall be made electronically to the
Holder’s or its designee’s balance account with DTC through its Deposit / Withdrawal at Custodian system in accordance
with the provisions of Section 1 above.

 

Notwithstanding anything
to the contrary contained herein, if the Holder’s obligation to exercise this Warrant upon a Mandatory Exercise would result
in the Holder exceeding the Maximum Percentage, the Holder shall still be required to exercise the Warrants and pay the Exercise
Price for all Warrant Shares (without regard to the Maximum Percentage), but the Holder shall not be entitled to receive any such
Excess Shares (or the beneficial ownership of, including voting rights with respect to, any such Excess Shares) and any Excess
Shares shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result
in the Holder exceeding the Maximum Percentage.

 

6.             NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not,
by amendment of its Certificate of Incorporation or Bylaws, or through any reorganization, transfer of assets, consolidation, merger,
scheme of arrangement, dissolution, issue or sale of securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, and will at all times in good faith carry out all of the provisions of this
Warrant and take all action as may be required to protect the rights of the Holder. Without limiting the generality of the foregoing,
the Company (i) shall not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant
above the Exercise Price then in effect, (ii) shall take all such actions as may be necessary or appropriate in order that
the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the proper exercise of this
Warrant by the Holder, and (iii) shall, so long as any of the Exchange Warrants are outstanding, take all action necessary to reserve
and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of

 

    	 	8	 

     

    

 

effecting the exercise
of the Exchange Warrants, the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of
the Exchange Warrants then outstanding (without regard to any limitations on exercise).

 

7.             WARRANT HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided
herein, the Holder, solely in such Person’s capacity as a holder of this Warrant, shall not be entitled to vote or receive
dividends or be deemed the holder of share capital of the Company for any purpose, nor shall anything contained in this Warrant
be construed to confer upon the Holder, solely in such Person’s capacity as the Holder of this Warrant, any of the rights
of a stockholder of the Company or any right to vote, give or withhold consent to any corporate action (whether any reorganization,
issue of stock, reclassification of stock, consolidation, merger, conveyance or otherwise), receive notice of meetings, receive
dividends or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant Shares which such Person is
then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained in this Warrant shall be construed
as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a stockholder
of the Company, whether such liabilities are asserted by the Company or by creditors of the Company. Notwithstanding this Section
7, the Company shall provide the Holder with copies of the same notices and other information given to the stockholders of the
Company generally, contemporaneously with the giving thereof to the stockholders.

 

8.             REISSUANCE OF WARRANTS.

 

(a)              
Transfer of Warrant. If this Warrant is to be transferred, the Holder shall surrender
this Warrant to the Company, whereupon the Company will forthwith issue and deliver upon the order of the Holder a new Warrant
(in accordance with Section 8(d)), registered as the Holder may request, representing the right to purchase the number of Warrant
Shares being transferred by the Holder and, if less than the total number of Warrant Shares then underlying this Warrant is being
transferred, a new Warrant (in accordance with Section 8(d)) to the Holder representing the right to purchase the number of Warrant
Shares not being transferred.

 

(b)              
Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant, and, in the case of loss, theft or destruction,
of any indemnification undertaking by the Holder to the Company in customary form and, in the case of mutilation, upon surrender
and cancellation of this Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section
8(d)) representing the right to purchase the Warrant Shares then underlying this Warrant.

 

(c)              
Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the surrender
hereof by the Holder at the principal office of the Company, for a new Warrant or Warrants (in accordance with Section 8(d)) representing
in the aggregate the right to purchase the number of Warrant Shares then underlying this Warrant, and each such new Warrant will
represent the right to purchase such portion of such Warrant Shares as is designated by the Holder at the time of such surrender;
provided, however, that no Exchange Warrants for fractional Warrant Shares shall be given.

 

(d)              
Issuance of New Warrants. Whenever the Company is required to issue a new Warrant pursuant
to the terms of this Warrant, such new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated
on the face of such new Warrant, the right to purchase the Warrant Shares then underlying this Warrant (or in the case of a new
Warrant being issued pursuant to Section 8(a) or Section 8(c), the Warrant Shares designated by the Holder which, when added to
the number of shares of Common Stock underlying the other new Warrants issued in connection with such issuance, does not exceed
the number of Warrant Shares then underlying this Warrant), (iii) shall have an issuance date, as indicated on the face of such
new Warrant which is the same as the Issuance Date, and (iv) shall have the same rights and conditions as this Warrant.

 

    	 	9	 

     

    

 

9.             NOTICES. Whenever notice is required to be given under this Warrant, unless otherwise
provided herein, such notice shall be given in accordance with Section 7(d) of the Exchange Agreement. The Company shall provide
the Holder with prompt written notice of all actions taken pursuant to this Warrant, including in reasonable detail a description
of such action and the reason therefor. Without limiting the generality of the foregoing, the Company will give written notice
to the Holder (i) immediately upon any adjustment of the Exercise Price, setting forth in reasonable detail, and certifying, the
calculation of such adjustment and (ii) at least five (5) days prior to the date on which the Company closes its books or takes
a record (A) with respect to any dividend or distribution upon the shares of Common Stock, (B) with respect to any grants, issuances
or sales of any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property to holders
of shares of Common Stock or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation;
provided in each case that such information shall be made known to the public prior to or in conjunction with such notice
being provided to the Holder. 

 

10             AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this
Warrant may be amended or waived and the Company may take any action herein prohibited, or omit to perform any act herein required
to be performed by it, only if the Company has obtained the written consent of the Required Holders, and with respect to any amendment,
the amendment is in writing and signed by the Company, except that any Holder may waive the Company’s performance hereunder
or provide consent as the only such Holder. 

 

11             GOVERNING LAW; JURISDICTION; JURY TRIAL. This Warrant shall be governed by and construed
and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this
Warrant shall be governed by, the internal laws of the State of New York, without giving effect to any choice of law or conflict
of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the exclusive jurisdiction
of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder
or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees
not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court,
that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is
improper. The Company hereby irrevocably waives personal service of process and consents to process being served in any such suit,
action or proceeding by mailing a copy thereof to the Company at the address set forth in Section 7(d) of the Exchange Agreement
and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall be
deemed or operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction
to collect on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations,
or to enforce a judgment or other court ruling in favor of the Holder. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY
HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT
OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

12.             CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted by the
Company and all the Buyers and shall not be construed against any Person as the drafter hereof. The headings of this Warrant are
for convenience of reference and shall not form part of, or affect the interpretation of, this Warrant.

 

    	 	10	 

     

    

 

13.             DISPUTE RESOLUTION. In the case of a dispute as to the determination of the Exercise
Price or the arithmetic calculation of the Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations
via electronic mail or facsimile within two (2) Business Days of receipt of the Exercise Notice giving rise to such dispute, as
the case may be, to the Holder. If the Holder and the Company are unable to agree upon such determination or calculation of the
Exercise Price or the Warrant Shares within three (3) Business Days of such disputed determination or arithmetic calculation being
submitted to the Holder, then the Company shall, within two (2) Business Days submit via electronic mail or facsimile (a) the disputed
determination of the Exercise Price to an independent, reputable investment bank selected by the Company and approved by the Holder
or (b) the disputed arithmetic calculation of the Warrant Shares to the Company’s independent, outside accountant. The Company
shall cause at its expense the investment bank or the accountant, as the case may be, to perform the determinations or calculations
and notify the Company and the Holder of the results no later than ten (10) Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s determination or calculation, as the case may
be, shall be binding upon all parties absent demonstrable error.

 

14.             REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided
in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and the other Transaction
Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing herein
shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant.
The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the
remedy at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened
breach, the holder of this Warrant shall be entitled, in addition to all other available remedies, to an injunction restraining
any breach, without the necessity of showing economic loss and without any bond or other security being required.

 

15.             TRANSFER.This Warrant and the Warrant Shares may be offered for sale, sold,
transferred, pledged or assigned without the consent of the Company.

 

16.             SEVERABILITY.If any provision of this Warrant is prohibited by law or otherwise
determined to be invalid or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited,
invalid or unenforceable shall be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the
invalidity or unenforceability of such provision shall not affect the validity of the remaining provisions of this Warrant so long
as this Warrant as so modified continues to express, without material change, the original intentions of the parties as to the
subject matter hereof and the prohibited nature, invalidity or unenforceability of the provision(s) in question does not substantially
impair the respective expectations or reciprocal obligations of the parties or the practical realization of the benefits that would
otherwise be conferred upon the parties. The parties will endeavor in good faith negotiations to replace the prohibited, invalid
or unenforceable provision(s) with a valid provision(s), the effect of which comes as close as possible to that of the prohibited,
invalid or unenforceable provision(s).

 

17.             DISCLOSURE. Upon receipt or delivery by the Company of any notice in accordance with
the terms of this Warrant, unless the Company has in good faith determined that the matters relating to such notice do not constitute
material, nonpublic information relating to the Company or its subsidiaries, the Company shall within four (4) Business Days after
any such receipt or delivery publicly disclose such material, nonpublic information on a Current Report on Form 8-K or otherwise.
In the event that the Company believes that a notice contains material, nonpublic information relating to the Company or its subsidiaries,
the Company so shall indicate to such Holder contemporaneously with delivery of such notice, and in the absence of any such indication,
the Holder shall be allowed to presume that all matters relating to such notice do not constitute material, nonpublic information
relating to the Company or its subsidiaries.

 

    	 	11	 

     

    

 

18.             CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have
the following meanings:

 

(a)  
“1933 Act” means the Securities Act of 1933, as amended.

 

(b)  
“Affiliate” means any Person that, directly or indirectly through one or
more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed
under Rule 405 under the Securities Act.

 

(a)  
“Attribution Parties” means, collectively, the following Persons and entities:
(i) any investment vehicle, including, any funds, feeder funds or managed accounts, currently, or from time to time after the Issuance
Date, directly or indirectly managed or advised by the Holder’s investment manager or any of its Affiliates or principals,
(ii) any Affiliates of the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group
together with the Holder or any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Common
Stock would or could be aggregated with the Holder’s and the other Attribution Parties for purposes of Section 13(d) of the
1934 Act. For clarity, the purpose of the foregoing is to subject collectively the Holder and all other Attribution Parties to
the Maximum Percentage. 

 

(b)  
“Bloomberg” means Bloomberg Financial Markets.

 

(c)  
“Business Day” means any day except any Saturday, any Sunday, any day which
is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized
or required by law or other governmental action to close.

 

(d)  
“Closing Bid Price” and “Closing Sale Price” means,
for any security as of any date, the last closing bid price and last closing trade price, respectively, for such security on the
Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an extended hours basis and does not
designate the closing bid price or the closing trade price, as the case may be, then the last bid price or the last trade price,
respectively, of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or, if the Principal Market is not
the principal securities exchange or trading market for such security, the last closing bid price or last trade price, respectively,
of such security on the principal securities exchange or trading market where such security is listed or traded as reported by
Bloomberg, or if the foregoing do not apply, the last closing bid price or last trade price, respectively, of such security in
the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, or, if no closing bid
price or last trade price, respectively, is reported for such security by Bloomberg, the average of the bid prices, or the ask
prices, respectively, of any market makers for such security as reported in the OTC Link or “pink sheets” by OTC Markets
Group Inc. (formerly Pink OTC Markets Inc.). If the Closing Bid Price or the Closing Sale Price cannot be calculated for a security
on a particular date on any of the foregoing bases, the Closing Bid Price or the Closing Sale Price, as the case may be, of such
security on such date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the
Holder are unable to agree upon the fair market value of such security, then such dispute shall be resolved pursuant to Section
13. All such determinations to be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification
or other similar transaction during the applicable calculation period.

 

(e)  
“Common Stock” means (i) the Company’s shares of Common Stock,
par value $0.0001 per share, and (ii) any share capital into which such Common Stock shall have been changed or any share
capital resulting from a reclassification of such Common Stock.

 

(f)   
“Common Stock Equivalents” means any securities of the Company or its subsidiaries
which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred
stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise
entitles the holder thereof to receive, Common Stock.

 

    	 	12	 

     

    

 

(g)  
“Convertible Securities” means any stock or securities (other than Options)
directly or indirectly convertible into or exercisable or exchangeable for shares of Common Stock.

 

(h)  
“Eligible Market” means the Principal Market, the NYSE American, The NASDAQ
Capital Market, The NASDAQ Global Market, The NASDAQ Global Select Market, or The New York Stock Exchange, Inc.

 

(i)  
 “Equity Conditions” means each of the following conditions: (i) a registration
statement shall be effective and available for the issuance or resale of all remaining Warrant Shares issuable upon exercise of
this Warrant; (ii) the Company shall have delivered all shares of Common Stock upon exercise of all warrants previously exercised
by the Holder, including under this Warrant, in each case in accordance with the terms of the applicable warrants; (iii) any applicable
shares of Common Stock to be issued in connection with the event requiring determination may be issued in full without violating
the rules or regulations of the Principal Market or any other applicable Eligible Market; (iv) the Holder shall not be in possession
of any material, nonpublic information received from the Company, any subsidiary or any of their respective agents or affiliates;
and (v) the shares of Common Stock issuable pursuant the event requiring the satisfaction of the Equity Conditions are duly authorized
and listed and eligible for trading without restriction on an Eligible Market. For point of clarification, the non-delivery of
shares of Common Stock as a result of their designation as “Excess Shares” shall not constitute an Equity Conditions
Failure.

 

(j)    
“Equity Conditions Failure” means that on any day during the period commencing
ten (10) Trading Days prior to the applicable date of determination through the applicable date of determination, the Equity Conditions
have not been satisfied (or waived in writing by the Holder).

 

(k)  
“Expiration Date” means the date thirty six (36) months after the Issuance
Date or, if such date falls on a day other than a Business Day or on which trading does not take place on the Principal Market
(a “Holiday”), the next day that is not a Holiday. 

 

(l)    
“Fundamental Transaction” means (A) that the Company shall, directly or
indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge
with or into (whether or not the Company is the surviving corporation) another Subject Entity, or (ii) sell, assign, transfer,
convey or otherwise dispose of all or substantially all of the properties or assets of the Company or any of its “significant
subsidiaries” (as defined in Rule 1-02 of Regulation S-X) to one or more Subject Entities, or (iii) make, or allow one or
more Subject Entities to make, or allow the Company to be subject to or have its Common Stock be subject to or party to one or
more Subject Entities making, a purchase, tender or exchange offer that is accepted by the holders of at least either (x) 50% of
the outstanding shares of Common Stock, (y) 50% of the outstanding shares of Common Stock calculated as if any shares of Common
Stock held by all Subject Entities making or party to, or Affiliated with any Subject Entities making or party to, such purchase,
tender or exchange offer were not outstanding; or (z) such number of shares of Common Stock such that all Subject Entities making
or party to, or Affiliated with any Subject Entity making or party to, such purchase, tender or exchange offer, become collectively
the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding shares of Common Stock,
or (iv) consummate a stock purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization,
spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities, individually or in the
aggregate, acquire, either (x) at least 50% of the outstanding shares of Common Stock, (y) at least 50% of the outstanding shares
of Common Stock calculated as if any shares of Common Stock held by all the Subject Entities making or party to, or Affiliated
with any Subject Entity making or party to, such stock

 

    	 	13	 

     

    

 

purchase agreement or other business combination were not outstanding; or
(z) such number of shares of Common Stock such that the Subject Entities become collectively the beneficial owners (as defined
in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding shares of Common Stock, or (v) reorganize, recapitalize or
reclassify its Common Stock, (B) that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or
otherwise, in one or more related transactions, allow any Subject Entity individually or the Subject Entities in the aggregate
to be or become the “beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, whether
through acquisition, purchase, assignment, conveyance, tender, tender offer, exchange, reduction in outstanding shares of Common
Stock, merger, consolidation, business combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization,
recapitalization or reclassification or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary
voting power represented by issued and outstanding Common Stock, (y) at least 50% of the aggregate ordinary voting power represented
by issued and outstanding Common Stock not held by all such Subject Entities as of the date of this Warrant calculated as if any
shares of Common Stock held by all such Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting
power represented by issued and outstanding shares of Common Stock or other equity securities of the Company sufficient to allow
such Subject Entities to effect a statutory short form merger or other transaction requiring other stockholders of the Company
to surrender their shares of Common Stock without approval of the stockholders of the Company or (C) directly or indirectly, including
through subsidiaries, Affiliates or otherwise, in one or more related transactions, the issuance of or the entering into any other
instrument or transaction structured in a manner to circumvent, or that circumvents, the intent of this definition in which case
this definition shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this definition
to the extent necessary to correct this definition or any portion of this definition which may be defective or inconsistent with
the intended treatment of such instrument or transaction; provided, however, that notwithstanding the foregoing, one or more bona
fide transactions the primary purpose of which is to raise capital shall not constitute a Fundamental Transaction, provided, further,
that no single Subject Entity party to such bona fide transaction acquires beneficial ownership of 25% or more of the outstanding
shares of Common Stock.

 

(m)  
“Group”
means a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5 thereunder.

 

(n)  
“Options” means any rights, warrants or options to subscribe for or purchase
shares of Common Stock or Convertible Securities.

 

(o)  
“Parent Entity” of a Person means an entity that, directly or indirectly,
controls the applicable Person, including such entity whose common shares or common stock or equivalent equity security is quoted
or listed on an Eligible Market (or, if so elected by the Required Holders, any other market, exchange or quotation system), or,
if there is more than one such Person or such entity, the Person or such entity designated by the Required Holders or in the absence
of such designation, such Person or entity with the largest public market capitalization as of the date of consummation of the
Fundamental Transaction.

 

(p)  
“Person” means an individual or corporation, partnership, trust, incorporated
or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision
thereof) or other entity of any kind.

 

(q)  
“Principal Market” means the Nasdaq Capital Market.

 

(r)   
“Required Holders” means the holders of the Exchange Warrants representing
at least a majority of the shares of Common Stock underlying the Exchange Warrants then outstanding.

 

    	 	14	 

     

    

 

(s)   
“Subject Entity” means any Person, Persons or Group or any Affiliate or
associate of any such Person, Persons or Group.

 

(t)    
“Successor Entity” means one or more Person or Persons (or, if so elected
by the Holder, the Company or Parent Entity) formed by, resulting from or surviving any Fundamental Transaction or one or more
Person or Persons (or, if so elected by the Holder, the Company or the Parent Entity) with which such Fundamental Transaction shall
have been entered into.

 

(u)  
“Trading Day” means any day on which the Common Stock is traded on the
Principal Market, or, if the Principal Market is not the principal trading market for the Common Stock, then on the principal securities
exchange or securities market on which the Common Stock is then traded; provided that “Trading Day” shall not
include any day on which the Common Stock is scheduled to trade on such exchange or market for less than 4.5 hours or any day that
the Common Stock is suspended from trading during the final hour of trading on such exchange or market (or if such exchange or
market does not designate in advance the closing time of trading on such exchange or market, then during the hour ending at 4:00:00
p.m., New York time).

 

[Signature Page Follows]

 

    	 	15	 

     

    

 

IN WITNESS WHEREOF,
the Company has caused this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out above.

 

 

	 	DROPCAR, INC.
	 	 	 
	 	By:	 	 
	 	Name:	Spencer Richardson
	 	Title:	Chief
Executive Officer

       

 

[Signature
Page to Warrant]

 

     

     

    

 

EXHIBIT A

 

EXERCISE NOTICE

TO BE EXECUTED BY THE REGISTERED HOLDER
TO EXERCISE THIS

WARRANT TO PURCHASE COMMON STOCK

 

DROPCAR,
INC. 

 

The undersigned holder
hereby exercises the right to purchase _________________ of the shares of Common Stock (“Warrant Shares”) of
DropCar, Inc., a Delaware corporation (the “Company”), evidenced by the attached Warrant to Purchase Common
Stock No. ____ (the “Warrant”). Capitalized terms used herein and not otherwise defined shall have the respective
meanings set forth in the Warrant.

 

1. Form of Exercise
Price. The Holder intends that payment of the Exercise Price shall be made as:

 

____________a
“Cash Exercise” with respect to _________________ Warrant Shares; and/or

 

____________a
“Cashless Exercise” with respect to _______________ Warrant Shares.

 

2. Payment of Exercise
Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued
pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in accordance
with the terms of the Warrant.

 

3. Delivery of Warrant
Shares. The Company shall deliver to the holder __________ Warrant Shares in accordance with the terms of the Warrant.

 

	_______ Electronic Delivery	 	DTC Participant:	 	 
	 	 	DTC Number:	 	 
	 	 	Account
Name:	 	 
	 	 	Account Number:	 	 
	 	 	 	 	 
	_______ Physical Delivery	 	Address:	 	 
	 	 	 	 	 
	 	 	 	 	 

  

Date: _______________ __, ______

 

 

 

Name of Registered Holder

 

	By:	 	 
	 	Name:	 
	 	Title:	 

 

     

     

    

 

ACKNOWLEDGMENT

 

The Company hereby
acknowledges this Exercise Notice and hereby directs Interwest Transfer Company, Inc. to issue the above indicated number of shares
of Common Stock in accordance with the Exercise Notice.

 

	 	DROPCAR, INC.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:

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