Exhibit 99.1
FIRST MASTER MODIFICATION OF CREDIT AGREEMENT AND
OTHER LOAN DOCUMENTS
This FIRST MASTER MODIFICATION OF CREDIT AGREEMENT AND OTHER LOAN
DOCUMENTS (this "FIRST AMENDMENT") dated effective as of September 13, 2005, is
executed and delivered by BEHRINGER HARVARD REIT I, INC., a Maryland corporation
("BORROWER"), BANK OF AMERICA, N.A., as Administrative Agent (together with its
successors and assigns, if any, "ADMINISTRATIVE AGENT") for itself and on behalf
of each Lender (herein so called) now or hereafter made a party to the Credit
Agreement described below, BEHRINGER HARVARD CYPRUS, LLC, a Colorado limited
liability company ("SPE"), and BEHRINGER HARVARD OPERATING PARTNERSHIP I LP, a
Texas limited partnership ("OPERATING PARTNERSHIP") (Operating Partnership and
SPE are sometimes also referred to herein, individually, as a "SUBSIDIARY
GUARANTOR" and, together, as "SUBSIDIARY GUARANTORS").
RECITALS
A. On or about December 30, 2004, Borrower, Administrative Agent
and Subsidiary Guarantors entered into a certain Credit Agreement (the "CREDIT
AGREEMENT") pursuant to the terms of which, among other things, Administrative
Agent and certain other Lenders now or hereafter made a party thereto (whether
one or more, the "LENDERS") agreed to make a revolving loan facility (the
"LOAN") available to Borrower in an amount up to $12,000,000.00. The Loan is
evidenced by a Promissory Note dated of even date with the Credit Agreement from
Borrower to Administrative Agent in the stated principal amount of up to
$12,000,000.00 (the "NOTE").
B. The obligations of Borrower under the Loan Documents (as such
term is defined in the Credit Agreement) are guaranteed by SPE pursuant to a
Guaranty Agreement dated as of December 30, 2004 (the "SPE GUARANTY") and by
Operating Partnership pursuant to a Guaranty Agreement dated as of December 30,
2004 (the "OP GUARANTY") (the SPE Guaranty and the OP Guaranty are hereinafter
singly and collectively referred to as the "GUARANTY").
C. The SPE Guaranty is secured by, among other things, (i) a Deed
of Trust, Assignment of Rents and Leases, Security Agreement, Fixture Filing and
Financing Statement dated December 30, 2004, executed by SPE in favor of the
Public Trustee of Arapahoe County, Colorado, as Trustee, recorded in the
Official Records of the Arapahoe County Clerk at Reception No. B4224410 (the
"DEED OF TRUST"), covering certain real property situated in Arapahoe County,
Colorado, as more particularly described therein (the "COLLATERAL"), and (ii) an
Assignment of Leases and Rents and Other Income dated December 30, 2004,
executed by SPE in favor of Administrative Agent, recorded in the Official
Records of the Arapahoe County Clerk at Reception No. B4224411 (the "ASSIGNMENT
OF RENTS AND LEASES").
D. As of the date of this First Amendment, Administrative Agent is
the sole Lender under the Credit Agreement and Borrower has requested that
Administrative Agent agree to issue one or more standby letters of credit for
the account of Borrower. Administrative Agent
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has agreed to modify the Credit Agreement to allow for the issuance of LCs (as
hereinafter defined) on the terms and conditions as more particularly set forth
in this First Amendment.
NOW, THEREFORE, for and in consideration of the premises, the sum of Ten
and No/100 Dollars ($10.00) and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged and confessed, Borrower,
Subsidiary Guarantors and Administrative Agent, for itself and on behalf of the
Lenders, hereby agree as follows:
1. AMENDMENTS TO CREDIT AGREEMENT.
1.1 Section 1.3 of the Credit Agreement is hereby amended
and restated in its entirety as follows:
1.3 COMMITMENT TO LEND AND ISSUE LCS. Borrower may
borrow from each Lender, and each Lender severally agrees to make
Advances of its Pro Rata Share of the Loan proceeds to Borrower in
amounts at any one time outstanding not to exceed such Lender's Pro Rata
Share of the Loan and (except for Administrative Agent with respect to
Administrative Agent Advances), on the terms and subject to the
conditions set forth in this Agreement and EXHIBIT C and EXHIBIT F
attached to this Agreement. In addition, Bank of America, N.A., in its
capacity as the issuer of LCs hereunder (herein, "ISSUING BANK") agrees
to issue one or more LCs for the account of Borrower not to exceed, in
the aggregate, the LC Sublimit on the terms and conditions set forth in
this Agreement. The Loan is a revolving loan. Subject to the other terms
and conditions hereof, Borrower may borrow, repay, and reborrow
hereunder. Anything contained in this Agreement to the contrary
notwithstanding, (i) the aggregate principal amount of all Advances
(plus the LC Exposure) outstanding at any one time shall not exceed the
lower of (A) $12,000,000.00, or (B) the Borrowing Base (the "MAXIMUM
COMMITMENT AMOUNT"); and (ii) the aggregate LC Exposure shall not exceed
the LC Sublimit. From time to time during the term of this Loan,
Administrative Agent may obtain a new or updated Appraisal of the
Property to determine the current, As Is Value of the Property, the cost
of which appraisal shall be payable in accordance with the provisions of
SECTION 2.13 hereof.
1.2 Section 1.10 of the Credit Agreement is hereby amended
and restated in its entirety as follows:
1.10 LETTERS OF CREDIT.
(a) CONDITIONS. Subject to the terms and
conditions of this Agreement, Issuing Bank agrees, if requested by
Borrower, to issue LCs upon Borrower's delivering an LC Agreement, which
must be received by Administrative Agent and Issuing Bank no later than
the third (3rd) Business Day before the Business Day on which the
requested LC is to be issued; provided that (A) no LC may expire later
than six months after the Maturity Date, and (B) each LC must expire no
later than one (1) year following its issuance (provided that upon the
request of Borrower, the applicable LC may automatically renew on its
anniversary date for additional one (1) year periods unless Issuing Bank
notifies the beneficiary thereof in writing to the contrary and
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provided that such automatic extensions may not automatically extend the
expiration date of any LC beyond a date that is later than six months
after the Maturity Date).
(b) PARTICIPATION. Immediately upon Issuing
Bank's issuance of any LC, Issuing Bank shall be deemed to have sold and
transferred to each other Lender, and each other Lender shall be deemed
irrevocably and unconditionally to have purchased and received from
Issuing Bank, without recourse or warranty, an undivided interest and
participation to the extent of such Lender's Pro Rata Share in the LC
and all applicable rights of Issuing Bank in the LC.
(c) REIMBURSEMENT OBLIGATION. To induce
Issuing Bank to issue and maintain LCs, and to induce Lenders to
participate in issued LCs, Borrower agrees to pay or reimburse Issuing
Bank (A) on the first (1st) Business Day after Issuing Bank notifies
Administrative Agent and Borrower that it has made payment under a LC,
the amount paid by Issuing Bank, and (B) within five (5) Business Days
after demand, the amount of any additional fees Issuing Bank customarily
charges for amending LC Agreements, for honoring drafts under LCs, and
for taking similar action in connection with letters of credit. If
Borrower has not reimbursed Issuing Bank for any drafts paid by the date
on which reimbursement is required under this Section, then
Administrative Agent is irrevocably authorized to, and shall
immediately, fund Borrower's reimbursement obligations as Base Rate
Principal if and so long as no Default exists. The proceeds of the Loan
shall be advanced directly to Issuing Bank to pay Borrower's unpaid
reimbursement obligations. If a Default exists, then Borrower's
reimbursement obligation shall constitute a demand obligation.
Borrower's obligations under this Section are absolute and unconditional
under any and all circumstances and irrespective of any setoff,
counterclaim, or defense to payment that Borrower may have at any time
against any Loan Party or any other Person. From the date that Issuing
Bank pays a draft under a LC until Borrower either reimburses or is
obligated to reimburse Issuing Bank for that draft under this Section,
the amount of such draft bears interest payable to Issuing Bank at the
rate then applicable to Base Rate Principal. From the due date of the
respective amounts due under this Section, to the date paid, unpaid
reimbursement amounts accrue interest that is payable on demand at the
Base Rate plus two percent (2%). Such interest shall accrue for the
actual days elapsed, including the first day but excluding the last day.
(d) GENERAL. Issuing Bank shall promptly
notify Administrative Agent and Borrower of the date and amount of any
draft presented for honor under any LC (but failure to give notice will
not affect Borrower's obligations under the Loan Documents). Issuing
Bank shall pay the requested amount upon presentment of a draft unless
presentment on its face does not comply with the terms of the applicable
LC. When making payment, Issuing Bank may disregard (A) any default or
potential default that exists under any other agreement, and (B)
obligations under any other agreement that have or have not been
performed by the beneficiary or any other Person (and Issuing Bank is
not liable for any of those obligations). Borrower's reimbursement
obligations to Issuing Bank and Lenders, and each Lender's obligations
to Issuing Bank, under this Section are absolute and unconditional
irrespective of, and Issuing Bank is not responsible for, (1) the
validity, enforceability, sufficiency, accuracy,
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or genuineness of documents or endorsements (even if they are in any
respect invalid, unenforceable, insufficient, inaccurate, fraudulent, or
forged), (2) any dispute by any Loan Party with, or any Loan Party's
claims, setoffs, defenses, counterclaims, or other rights against,
Administrative Agent, Issuing Bank, any Lender or any other Person, or
(3) the occurrence of any Potential Default or Default.
(e) OBLIGATION OF LENDERS. If Borrower fails
to reimburse Issuing Bank as provided in this SECTION 1.10 by the date
on which reimbursement is due under such Section, and an Advance cannot
be made to satisfy the reimbursement obligations, then Administrative
Agent shall promptly notify each Lender of Borrower's failure, of the
date and amount paid, and of each Lender's Pro Rata Share of the
unreimbursed amount. Each Lender shall promptly and unconditionally make
available to Administrative Agent in immediately available funds its Pro
Rata Share of the unpaid reimbursement obligation. Funds are due and
payable to Administrative Agent before the close of business on the
Business Day when Administrative Agent gives notice to each Lender of
Borrower's reimbursement failure (if notice is given before 12:00 noon)
or on the next succeeding Business Day (if notice is given after 12:00
noon). All amounts payable by any Lender accrue interest after the due
date from the day the applicable draft or draw is paid by Issuing Bank
to (but not including) the date the amount is paid by such Lender to
Administrative Agent at the Federal Funds Effective Rate for three (3)
Business Days and thereafter at the Base Rate. Upon receipt of such
funds, Administrative Agent shall make them available to Issuing Bank.
(f) DUTIES OF ISSUING BANK. Issuing Bank
agrees with each Lender and Borrower that it will exercise and give the
same care and attention to each LC as it gives to its other letters of
credit. Each Lender and Borrower agree that, in paying any draft under
any LC, Issuing Bank has no responsibility to obtain any document (other
than any documents expressly required by the respective LC) or to
ascertain or inquire as to any document's validity, enforceability,
sufficiency, accuracy, or genuineness or the authority of any Person
delivering it. Neither Issuing Bank nor its representatives will be
liable to any Lender or Borrower for any LC's use or for any
beneficiary's acts or omissions (including, without limitation, any acts
or omissions constituting ordinary negligence). Any action, inaction,
error, delay, or omission taken or suffered by Issuing Bank or any of
its representatives in connection with any LC, applicable drafts or
documents, or the transmission, dispatch, or delivery of any related
message or advice, if in good faith and in conformity with applicable
Legal Requirements and in accordance with (A) the rules of the
"International Standby Practices 1998" published by the Institute of
International Banking Law & Practice (or such later version thereof as
may be in effect at the time of issuance), which shall apply to each
standby LC, and (B) the rules of the Uniform Customs and Practice for
Documentary Credits, as most recently published by the International
Chamber of Commerce (the "ICC") at the time of issuance --- (including
the ICC decision published by the Commission on Banking Technique and
Practice on April 6, 1998 regarding the European single currency
(euro)), which shall apply to each LC, is binding upon Borrower and
Lenders and does not place Issuing Bank or any of its Representatives
under any resulting liability to Borrower or any Lender. Issuing Bank is
not liable to Borrower or any Lender for any action taken or
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omitted, in the absence of gross negligence or willful misconduct, by
Issuing Bank or its Representatives in connection with any LC.
(g) CASH COLLATERAL. Within five (5) days
after the Maturity Date and if requested by Required Lenders while a
Default exists, Borrower shall provide Administrative Agent, for the
benefit of the Loan Parties, cash collateral in an amount to equal the
then-existing LC Exposure. If at any time during the term of the Loan or
while any LC is outstanding, the then-existing LC Exposure exceeds the
Borrowing Base then Borrower also shall deliver to Administrative Agent,
for the benefit of the Loan Parties, within five (5) days after demand
therefor by Administrative Agent, cash collateral equal to the amount by
which the LC Exposure exceeds the Borrowing Base, which cash collateral
shall be held by Administrative Agent in an interest-bearing account
until such time as the LC Exposure no longer exceeds the Borrowing Base.
So long as no Default then exists, all interest earned on funds on
deposit in such account will be released to Borrower, at Borrower's
request, no more frequently than once a month. If any LC Exposure is
cash collateralized during a Default and Borrower cures such Default as
required by the Loan Documents, then Administrative Agent shall release
such cash collateral; PROVIDED, HOWEVER, the release of such cash
collateral shall not limit or waive the right of Administrative Agent to
require that the LC Exposure be cash collateralized again upon the
occurrence of a subsequent Default.
(h) INDEMNIFICATION. Borrower shall protect,
indemnify, pay, and save each of the Lenders and the Issuing Bank and
their respective Representatives harmless from and against any and all
claims, demands, liabilities, damages, costs, charges, and expenses
(including reasonable attorneys' fees) which any of them may incur or be
subject to as a consequence of the issuance of any LC, any dispute about
any LC, or the failure of Issuing Bank to honor a draw request under any
LC. Although each the Lenders and the Issuing Bank and their respective
Representatives have the right to be indemnified for its or their own
ordinary negligence, no Person is entitled to indemnity under the
foregoing for its own gross negligence or willful misconduct (including
a knowing and willful breach of its material obligations under this
Agreement or an LC Agreement) and no other Person shall have the right
to be indemnified hereunder by Borrower as a result of the gross
negligence or willful misconduct of Issuing Bank.
(i) LC AGREEMENTS. Although referenced in
any LC, terms of any particular agreement or other obligation to the
beneficiary are not incorporated into this Agreement in any manner. The
fees and other amounts payable with respect to each LC are as provided
in this Agreement, the reimbursement obligations for drafts under each
LC are part of the Obligations, only the events specified in this
Agreement as a Default shall constitute a default under any LC
Agreement, and the terms of this Agreement control any conflict between
the terms of this Agreement and any LC Agreement. In furtherance of the
foregoing, but not in limitation thereof, this Agreement shall control
and supercede the following paragraphs of Bank of America's current form
of LC Agreement: Paragraphs 1(a), (b), (f), and (g), 2, 3, 4 and 8(d).
(j) LC FEE. Borrower shall pay to the
Administrative Agent
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for the account of each Lender in accordance with its Pro Rata Share a
LC fee for such LC equal to the greater of (i) 1.25% per annum times the
daily maximum amount available to be drawn under the LC, or (ii) $500.
Such fee shall be due and payable, quarterly, in advance, commencing on
the date the LC is issued by Issuing Bank and on the same day of each
third calendar month thereafter until the LC expiration date.
(k) LC DOCUMENTATION. If requested by
Borrower or the beneficiary of any LC, Issuing Bank will provide
Borrower with copies of applicable authorizing resolutions and evidence
of incumbency of the officer executing a LC, which resolutions and
evidence of incumbency shall be in form customarily provided by Issuing
Bank in connection with the issuance of letters of credit.
1.3 Section 2.16(c) of the Credit Agreement is hereby
amended and restated in its entirety as follows:
(c) LIABILITIES/ASSETS. As of each Test Date during
the term of the Loan, the ratio (expressed as a percentage) of (i) the
sum of (A) all liabilities of Borrower, determined in accordance with
GAAP, and (B) all Off-Balance Sheet Liabilities of Borrower, in each
case as of any Test Date, to (ii) all assets of Borrower, determined in
accordance with GAAP as of the same Test Date, shall not be greater than
seventy-five percent (75%).
1.4 Section 4.1(a) of the Credit Agreement is hereby amended
and restated in its entirety as follows:
(a) FAILURE TO PAY INDEBTEDNESS. Any (i) principal
or interest of the Loan is not paid when due on the Maturity Date, or in
the case of any of the principal or interest on the Loan due on a date
other than the Maturity Date, any of such principal or interest is not
paid within five (5) days after the same became due, (ii) any draw under
an LC is not reimbursed to Issuing Bank when required in accordance with
this Agreement (and Administrative Agent is not authorized to make an
Advance hereunder for the amount of Borrower's reimbursement obligation
as provided in SECTION 1.10 hereof), or (iii) other Indebtedness (other
than principal or interest on the Loan or a reimbursement obligation in
respect of a LC) is not paid within thirty (30) days after the same
became due.
1.5 Section 5.1 of the Credit Agreement is hereby amended to
add the following paragraph at the end of the Section:
Issuing Bank shall act on behalf of Lenders with respect
to any LC issued by it and the documents associated therewith, and
Issuing Bank shall have all of the benefits and immunities (i) provided
to Administrative Agent in this ARTICLE 5 with respect to any acts taken
or omissions suffered by Issuing Bank in connection with any LC issued
by it or proposed to be issued by it and the applications and agreements
for letters of credit pertaining to such LC as fully as if the term
"Administrative Agent" as used in this ARTICLE 5 and in the definition
of "Agent-Related Person" included Issuing
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Bank with respect to such acts or omissions, and (ii) as additionally
provided herein with respect to Issuing Bank.
1.6 Section 5.9 of the Credit Agreement is hereby amended
and restated in its entirety as follows:
5.9 SUCCESSOR ADMINISTRATIVE AGENT. Administrative
Agent may, and at the request of the Required Lenders as a result of the
Administrative Agent's gross negligence or willful misconduct in
performing its duties under this Agreement shall, resign as
Administrative Agent upon thirty (30) days' notice to Lenders; provided
that any such resignation by Bank of America, N.A. shall also constitute
its resignation as Issuing Bank. If Administrative Agent resigns under
this Agreement, then Required Lenders shall appoint from among the other
Lenders a successor administrative agent for Lenders, provided that
Borrower shall have the right to approve such successor administrative
agent at all times other than during the existence of a Default (which
consent of Borrower shall not be unreasonably withheld or delayed). If
no successor administrative agent is appointed prior to the effective
date of the resignation of Administrative Agent, then Administrative
Agent may appoint, after consulting with Lenders and Borrower, a
successor administrative agent from among the other Lenders. Upon the
acceptance of its appointment as successor administrative agent
hereunder, the Person acting as such successor administrative agent
shall succeed to all the rights, powers and duties of the retiring
Administrative Agent and Issuing Bank and the respective terms
"Administrative Agent" and "Issuing Bank" shall mean such successor
administrative agent and issuing bank and the retiring Administrative
Agent's appointment, powers, and duties as Administrative Agent shall be
terminated and the retiring Issuing Bank's rights, powers and duties as
such shall be terminated, without any other or further act or deed on
the part of such retiring Issuing Bank or any other Lender, other than
the obligation of the successor Issuing Bank to issue letters of credit
in substitution for the LCs, if any, outstanding at the time of such
succession or to make other arrangements satisfactory to the retiring
Issuing Bank to effectively assume the obligations of the retiring
Issuing Bank with respect to such LCs. After any retiring Administrative
Agent's resignation hereunder as Administrative Agent, the provisions of
this Agreement, including SECTION 6.10 of this Agreement, shall inure to
its benefit as to any actions taken or omitted to be taken by it while
it was Administrative Agent under this Agreement. If no successor
administrative agent has accepted appointment as Administrative Agent by
the date which is thirty (30) days following a retiring Administrative
Agent's notice of resignation, the retiring Administrative Agent's
resignation shall nevertheless thereupon become effective and Lenders
shall perform all of the duties of Administrative Agent hereunder until
such time, if any, as Required Lenders appoint a successor agent as
provided for above.
1.7 DEFINITIONS. Commencing on the date hereof, the
following capitalized terms shall have the meaning set forth below when used
herein or in the Credit Agreement, and to the extent such capitalized terms are
also defined in the Credit Agreement, such definitions shall be deemed amended
by this First Amendment:
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"ANNUALIZED ADJUSTED EXPENSES" means the GREATER of (i) the
aggregate, actual cash operating expenses of the Property (excluding
non-cash expenses such as depreciation and expenses paid from reserves)
calculated for each calendar month during the trailing twelve (12) month
period, but: (a) not including payments of principal or interest on the
Loan or reimbursement obligations in respect of any LC during such
period; and (b) adjusted to include (but without duplication of the
above) appropriate monthly accruals for the Property for: (1) a
management fee of at least four percent (4%) per annum, (2) periodic
expenses such as property taxes and insurance, and (3) a reserve (not
less than $0.15 per square foot of leaseable space in the Improvements
per annum) for capital repairs and replacements, or (ii) the projected
operating expenses per square foot of leaseable space in the
Improvements, annualized, as determined by Administrative Agent pursuant
to a current Appraisal of the Property, prepared by an appraiser
acceptable to Administrative Agent and satisfactory to Administrative
Agent in all respects, as reviewed, adjusted and approved by
Administrative Agent in accordance with its customary internal appraisal
requirements.
"COMMITMENT" means, as to each Lender, its obligation to advance
its Pro Rata Share of the Loan (including the LC Exposure) in an
aggregate principal amount not exceeding the amount set forth opposite
such Lender's name on the Schedule of Lenders at any one time
outstanding, as such amount may be reduced or adjusted from time to time
in accordance with this Agreement.
"DEEMED PRINCIPAL BALANCE" means, as of any date, the maximum
principal amount of the Loan, plus all LC Exposure, less any permanent
limitation on the Commitments of Lenders hereunder.
"LC" means a standby letter of credit issued for the account of
Borrower by Issuing Bank under this Agreement and under an LC Agreement.
"LC AGREEMENT" means a letter of credit application and
agreement (in form and substance satisfactory to Issuing Bank) submitted
and executed by Borrower to Issuing Bank for an LC for the account of
Borrower. Bank of America's current form of LC Agreement is attached as
Exhibit A to this First Amendment.
"LC EXPOSURE" means, without duplication, the sum of (a) the
maximum undrawn amount of all existing and uncancelled LCs plus (b) the
total unpaid reimbursement obligations of Borrower under drawings under
all LCs.
"LC SUBLIMIT" means an amount equal to $8,500.000.00. The LC
Sublimit is part of, and not in addition to, the Aggregate Commitments.
"OBLIGATIONS" means all liabilities, obligations, covenants and
duties of, Borrower, each Subsidiary Guarantor and each other Loan Party
from time to time owed to Administrative Agent or Lenders or any of them
under or otherwise with respect to any Loan Document or otherwise with
respect to the Loan and the LCs, whether direct or indirect (including
those acquired by assumption), absolute or contingent, due or to
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become due, now existing or hereafter arising and including interest and
fees that accrues after the commencement by or against Borrower and/or
any Subsidiary Guarantor or any Affiliate thereof of any proceeding
under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed
claims in such proceedings.
"OFF-BALANCE SHEET LIABILITIES" means, with respect to the
Borrower, as of each Test Date during the term of the Loan, without
duplication and to the extent not included as a liability on the
consolidated balance sheet of Borrower in accordance with GAAP: (a) with
respect to any asset securitization transaction (including any accounts
receivable purchase facility) (i) the unrecovered investment of
purchasers or transferees of assets so transferred; and (ii) any other
payment, recourse, repurchase, hold harmless, indemnity or similar
obligation of Borrower in respect of assets transferred or payments made
in respect thereof, other than limited recourse provisions that are
customary for transactions of such type and that neither (x) have the
effect of limiting the loss or credit risk of such purchasers or
transferees with respect to payment or performance by the obligors of
the assets so transferred nor (y) impair the characterization of the
transaction as a true sale under applicable Laws (including Debtor
Relief Laws); (b) the monetary obligations of Borrower in its capacity
as lessee or a similar capacity, under any financing lease or so-called
"synthetic," tax retention or off-balance sheet lease transaction which,
upon the application of any Debtor Relief Law to Borrower, would be
characterized as indebtedness; or (c) the monetary obligations of
Borrower under any sale and leaseback transaction which does not create
a liability on the consolidated balance sheet of Borrower; or (d) any
other monetary obligation arising with respect to any other transaction
which (i) is characterized as indebtedness for tax purposes but not for
accounting purposes in accordance with GAAP or (ii) is the functional
equivalent of or takes the place of borrowing but which does not
constitute a liability on the consolidated balance sheet of Borrower
(for purposes of this clause (d), any transaction structured to provide
tax deductibility as interest expense of any dividend, coupon or other
periodic payment will be deemed to be the functional equivalent of a
borrowing).
"PAYMENT AMOUNT" means an Advance of the Loan, an unpaid
reimbursement obligation under an LC, an unreimbursed Administrative
Agent Advance, an unreimbursed Indemnified Liability, or any other
amount that a Lender is required to fund under this Agreement.
"PRINCIPAL DEBT" means the aggregate unpaid principal balance of
the Loan at the time in question on any date of determination and
without duplication, the aggregate unpaid principal balance of the Loan,
together with all aggregate unpaid reimbursement obligations of Borrower
in respect of drawings under all LCs.
"RELEASE DATE" means, as to each Project, the earlier of the
following two dates: (i) the date on which the Indebtedness and
Obligations secured by the Mortgage encumbering such Project (other than
those indemnifications or obligations which, by the terms of the
Mortgage, expressly survive repayment of the Indebtedness or release of
the Mortgage) have been paid and performed in full, any remaining LC
Exposure is
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collateralized as provided in SECTION 1.10, and such Mortgage has been
released; or (ii) the later date on which the lien of such Mortgage is
fully and finally foreclosed (and all applicable redemption periods have
expired) or a conveyance by deed in lieu of such foreclosure is fully
and finally effective and possession of the Property subject to such
Mortgage has been given to and accepted by the purchaser or grantee free
of occupancy and claims to occupancy by any Loan Party and its heirs,
devisees, representatives, successors and assigns; provided that, if
such payment, performance, release, foreclosure or conveyance is
challenged, in bankruptcy proceedings or otherwise, the Release Date
shall be deemed not to have occurred until such challenge is validly
released, dismissed with prejudice or otherwise barred by law from
further assertion.
2. AMENDMENT TO SPE GUARANTY AND OP GUARANTY. Subsidiary Guarantors
each acknowledge and agree that, as used in the Guaranty, (i) the term
"Indebtedness" shall hereafter include all indebtedness and obligations of
Borrower arising under any LC Agreement, (ii) the term "Guaranteed Obligations"
shall hereafter include all obligations of Borrower arising under any LC
Agreement; and (iii) the term "Credit Agreement" shall hereafter mean the Credit
Agreement, as amended by this First Amendment.
3. AMENDMENT TO DEED OF TRUST AND ASSIGNMENT OF RENTS AND LEASES.
3.1 SPE acknowledges and agrees, that as used in the Deed of
Trust and/or the Assignment of Rents and Leases, (i) the term "Guaranty" shall
hereafter mean and refer to the SPE Guaranty, as amended by this First
Amendment, (ii) the term "Secured Indebtedness" shall hereafter include all
indebtedness obligations owing by Borrower or arising under any LC Agreement;
(iii) the term "Guaranteed Obligations" shall hereafter include all obligations
of Borrower arising under any LC Agreement; and (iv) the term "Credit Agreement"
shall hereafter mean the Credit Agreement, as amended by this First Amendment.
3.2 The Deed of Trust is hereby amended as follows:
(a) by inserting the phrase "or collateralized as
provided in the Credit Agreement" after the phrase "have been paid and
performed" in clause (i) of the penultimate sentence of Section
2.1(f)(ii) thereof;
(b) by inserting the phrase ", cash collateral for
any letter of credit outstanding under the Credit Agreement" after the
phrase "on the Secured Indebtedness" in Section 5.2 thereof; and
(c) by inserting the phrase ", or collateralized as
provided in the Credit Agreement" after the phrase "as the same becomes
due and payable" in Section 6.12 thereof.
4. REPRESENTATIONS. Borrower and Subsidiary Guarantors each hereby
severally represents and warrants to Administrative Agent and the other Lenders
that (a) to the best of such party's knowledge, the execution and delivery of
this First Amendment does not contravene, result in a breach of or constitute a
default under any deed of trust, loan agreement, indenture or other contract or
agreement to which it is a party or by which it or any of the properties of it
may
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be bound; (b) this First Amendment constitutes the legal, valid and binding
obligation of such party enforceable in accordance with its terms, subject to
the limitations of equitable principles and bankruptcy, insolvency, debtor
relief or other similar laws affecting generally the enforcement of creditors'
rights; (c) the execution and delivery of, and performance under this First
Amendment are within such party's power and authority without the joinder or
consent of any other party and have been duly authorized by all requisite action
and are not in contravention of law or the provisions of any organizational
documents governing such party or of any indenture, agreement or undertaking to
which Borrower, SPE or Subsidiary Guarantor, as applicable, is a party or by
which it is bound; and (d) to the knowledge of such party, there exists no
uncured default under the Note, the Deed of Trust or any other Loan Document.
5. RATIFICATION. The parties to this First Amendment agree that the
terms and provisions of this First Amendment shall modify and supersede all
inconsistent terms and provisions of the Loan Documents and, except as expressly
modified and superseded by this First Amendment, the terms and provisions of
each of the Loan Documents are ratified and confirmed and shall continue in full
force and effect. The liens, security interests, collateral assignments and
financing statements in respect of the Loan are hereby ratified and confirmed as
valid, subsisting and continuing to secure the Loan Documents. Nothing herein
shall in any manner diminish, impair or extinguish the Note or any of the
Obligations. Borrower, SPE and Subsidiary Guarantor hereby ratify and
acknowledge that the Loan Documents are valid, subsisting and enforceable and
agree and warrant that there are no offsets, claims or defenses with respect to
any of the Obligations.
6. CONSENT AND RATIFICATION. Subsidiary Guarantors each hereby
severally, unconditionally and irrevocably acknowledge and agree that the
Guaranty executed by such Subsidiary Guarantor and such Subsidiary Guarantor's
obligations, covenants, agreements and duties thereunder remain in full force
and effect, notwithstanding the modification of the Loan Documents effected
hereby. Each Subsidiary Guarantor hereby unconditionally and irrevocably
ratifies, reaffirms and confirms the Guaranty executed by such Subsidiary
Guarantor and its obligations thereunder.
7. RELEASE OF USURY CLAIMS. Borrower and Subsidiary Guarantors each
hereby releases Administrative Agent and the other Lenders and their successors
and assigns, from all claims, demands, liabilities, rights of offsets, defenses
and causes of action which Borrower and/or Subsidiary Guarantors may be entitled
to assert (although no such claims are known to exist) against Administrative
Agent and the other Lenders in respect of the Note, the Credit Agreement and the
other Loan Documents for any reason whatsoever, including without limitation, by
reason of Lenders' contracting, charging or receiving for the use, forbearance
or detention of money, interest on the loan evidenced by the Note prior to the
execution of this First Amendment in excess of that permitted to be charged to
Borrower or Subsidiary Guarantors under applicable law.
8. COUNTERPARTS. This First Amendment may be executed in any number
of counterparts with the same effect as if all parties hereto had signed the
same document. All such counterparts shall be construed together and shall
constitute one instrument, but in making proof hereof it shall only be necessary
to produce one such counterpart.
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9. BINDING EFFECT. The terms and provisions hereof shall be binding
upon and inure to the benefit of the parties hereto, their representatives,
successors and assigns.
10. APPLICABLE LAW. The Credit Agreement, as modified hereby, shall
be construed in accordance with the laws of the State of Texas and the laws of
the United States applicable to transactions in the State of Texas.
THE WRITTEN 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.
REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK
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IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment as of the date and year first above written.
BORROWER:
BEHRINGER HARVARD REIT I, INC.,
a Maryland corporation
By:________________________________
Name:______________________________
Title:_____________________________
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ADMINISTRATIVE AGENT, ISSUING BANK AND
LENDER:
BANK OF AMERICA, N.A., a national
banking association, in its capacity as
Administrative Agent, Issuing Bank and
Lender
By: ____________________________________
Name: Xxxxx Xxxx
Title: Vice President
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SUBSIDIARY GUARANTOR:
BEHRINGER HARVARD CYPRUS, LLC,
a Colorado limited liability company
By: Behringer Harvard Operating
Partnership I LP, a Texas limited
partnership, its sole member
By: Behringer Harvard REIT Inc.,
a Maryland corporation, its
sole general partner
By:___________________________
Name: Xxxxxx X. Xxxxxxx, III
Title: Executive Vice
President
SUBSIDIARY GUARANTOR:
BEHRINGER HARVARD OPERATING PARTNERSHIP
I LP, a Texas limited partnership, its
sole member
By: Behringer Harvard REIT Inc., a
Maryland corporation, its sole
general partner
By:___________________________
Name: Xxxxxx X. Xxxxxxx, III
Title: Executive Vice
President
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EXHIBIT A
BANK OF AMERICA LC APPLICATION
